Shield Therapeutics (STX ) confirmed to investors that it will commence trading on the OTCQX Best Market ("OTCQX") in the United States today, under the ticker symbol "SHIEF".
The commercial stage pharmaceutical firm focused on addressing iron deficiency with its product Feraccru®/Accrufer® explained that the listing, which will see its shares become available to US investors during US working hours and priced in US dollars (nominal value of its shares at £0.015 each), has the potential to increase liquidity in Shield's shares on AIM.
Shield highlighted that it will not face any extra reporting obligations and incur minimal ongoing costs as a result of the Company's Ordinary Shares being traded on the OTCQX.
As part of its listing on the OTCQX market, Shield has retained MCAP LLC to act as its OTCQX advisor. MCAP is a US broker-dealer that provides institutional securities services and electronic market making which has also acted as the Company's OTCQX sponsor.
"With the upcoming launch of Accrufer® in the US I believe that Shield will be of increasing relevance to US based investors,” commented Tim Watts, CEO of Shield Therapeutics.
Shield said its ‘most significant effort’ in 2020 was finding a route to the US market for Accrufer®. After several discussions with potential partners, Shield decided to self-launch, a move which it believes can generate greater value for shareholders than a licence deal.
As at 31 December 2020, Shield held cash of £2.9m (2019: £4.1m). In addition, last month, shareholders approved an equity fundraise which raised £27.8 m net of expenses and as a result, the Group's unaudited cash balance as at 31 March 2021 stood at £28.2m which the Group plans to utilise to launch Accrufer® in the US during the second quarter of 2021.
The Board anticipates that rising sales of Accrufer® in the US should result in the Company’s monthly cash flow turning positive between 15-18 months after the initial launch as well as hold the potential for net sales to reach $100 million in the third year after launch.
‘Instead of receiving a royalty stream, perhaps averaging 15%-20%, on a US partner's sales, we will now benefit from a high margin product whose sales could grow to $300 million to $400m over the next five to six years and which is patent protected until 2035,’ it noted.
Shield said it will also incur the costs of the main stage of the paediatric study which is expected to start in mid-2021 and last for 2-2½ years and cost c.£4.5m over that time.
He added that, “By making our shares available on the OTCQX Best Market many US investors should find it easier to buy and sell Shield shares than they would through AIM. Shield's existing shareholders should benefit from this as liquidity increases."
Jason Paltrowitz, who is the Executive Vice President of Corporate Services at OTC Markets Group commented: "We are delighted to welcome Shield Therapeutics to the OTCQX Market. Cross-trading on OTCQX will enable Shield Therapeutics, listed on the LSE AIM Market, to expand its U.S. investor base and enhance the Company's global reach.”
He added, “We look forward to providing the company and its investors with a transparent and efficient trading experience and all the benefits of our premium public market."
View from Vox
Shield Therapeutics has said it believes the first US launch of an oral HIF inhibitor for chronic kidney disease (CKD) patients, which is anticipated for launch in the second quarter of 2021, ‘is likely to increase the need for effective and well tolerated oral iron replacement therapy.’
Shield previously stated that the US market opportunity for Accrufer® is ‘substantial and growing’ and in Shield's head-to-head study, Accrufer® was identified to be a credible alternative to IV therapy particularly for maintaining haemoglobin levels over the long term.
Potential sales estimates for Accrufer® in the US are forecasted to exceed $100 million from the third year following launch and to reach $300 million-$400 million by years five to six.
Despite shares having more than halved in recent months following the news that STX would not be signing a US marketing deal before the end of 2020, STX’s Directors believe its recent fundraising fulfils the necessary requirements for a Shield-led US launch of Accrufer®, a pathway they view as having the potential to generate significant returns for shareholders.
In addition, today’s news that the company has acquired an additional listing on this US market is expected to increase STX’s visibility to US investors ahead of Accrufer®’s launch.
Shares in Shield Therapeutics were trading 3.92% higher today at 53p following the news.
Reasons to STX
Shield is a de-risked, specialty pharmaceutical company focused on commercialising its lead product, Feraccru®/Accrufer®, a novel, non-salt based oral therapy for adults with iron deficiency with or without anaemia.
Proven and Approved
The Group’s Feraccru®/Accrufer® product has been approved for use in the United States, European Union, UK and Switzerland and has exclusive IP rights until the mid-2030s.
Feraccru® is commercialised across the UK and European Union by Norgine B.V. and the Company is currently in the process of evaluating commercialisation options for the US market, including the potential launch of Accrufer® in the US by Shield.
Shield also has an exclusive licence agreement with Beijing Aosaikang Pharmaceutical to develop and commercialise Feraccru®/Accrufer® in China, Hong Kong, Macau and Taiwan.
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