In its half-year report for the six months to 30 June 2021, Shield Therapeutics (STX ) hailed “a truly pivotal” period despite swinging to a pre-tax loss, following the US launch of Accrufer®. 

The London-listed pharmaceutical firm reported its 1H21 pre-tax loss at £7.6m compared to a previous profit of £2.7m for 1H20 after the firm reported higher costs and lower revenue.  

Over the period, revenue fell to £0.4m from £8.9m ‘entirely as a result of ‘royalties from Norgine BV in respect of sales of its iron-deficiency product Feraccru in Europe,’ it said. 

Following the equity fundraise completed in March 2021, which raised £27.7 million net of expenses, cash at 30 June 2021 was £22.6 million (31 December 2020: £2.9 million). 

Despite the booked pre-tax loss for 1H21, Greg Madison, Chief Executive of Shield, commented: "The first six months of 2021 have been a truly pivotal and exciting period for Shield which opens up the prospect of substantially greater shareholder value for investors.  

Commenting on the 1H21 results, he said: “During the first quarter the Group's US strategy transitioned from an out-licence approach to one of launching Accrufer® ourselves in the US, and the successful fundraise in March 2021 provided the financial resources for the launch. 

In the second quarter a huge amount of planning and implementation was completed which allowed us to launch Accrufer® on 1 July 2021 and I am pleased with progress to date.” 

At the end of June 2021, Shield confirmed that it would launch Accrufer®, its iron-containing medication for the treatment of adults with low iron stores, in the US from 1 July 2021.  

In 2020, the Group’s ‘most significant effort’ has been finding a route to the US market for Accrufer®. After discussions with potential partners, Shield decided to go with a self-launch, a move which it believes can generate greater value for shareholders than with a licence deal.     

The iron deficiency-focused firm said a sales force of 30 sales representatives that had been recruited and trained had started to contact key prescribers during the first week of July 2021. 

Shield’s Board anticipates that rising sales of Accrufer® in the US should result in the Group’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.   

In Europe, Shield’s licensing partner for Feraccru®, Norgine BV, started selling in the Nordic markets in 2H20, also launching the product in Belgium and Luxembourg in early 2021. 

The number of Feraccru® packs sold by Norgine BV across Europe increased by 51% in 1H21 compared with 2H20 and by 57% compared with 1H20, the Company told investors. 

Shield said Norgine continues to focus on driving commercial adoption in countries where Feraccru® has already gained reimbursement while looking to obtain reimbursement in further countries, with a focus on the major European markets of France, Italy and Spain.  

Meanwhile, in China, where Feraccru® is not yet approved, the Chinese regulatory authority (CDE) has approved an Investigational New Drug (IND) application for Feraccru® which was submitted by the Company’s existing Chinese licence partner, ASK Pharm, to conduct two studies which CDE has confirmed are sufficient to support a New Drug Application.  

The two studies include a 12-week Phase III study in 120 Inflammatory Bowel Disease (IBD) patients as well as a pharmacokinetic/pharmacodynamic study to be conducted in parallel. 

To date, clinical supplies have been manufactured and released for the study and ASK Pharm has started screening patients. It is expected that the study could be completed by the end of 2022 and that marketing approval and a product launch could follow by late 2023. 

On approval, Shield is due to receive an $11.4 million milestone payment from ASK Pharm and tiered royalties of 10% or 15% depending on the level of net sales, and up to US$40 million in milestone payments upon the achievement of specified cumulative sales targets.  

In addition, last week, Shield said it had entered into an exclusive licence agreement with the pharmaceutical company Korea Pharma which will enable it to market Accrufer® in Korea.  

Under the agreement, Korea Pharma will be responsible for all clinical and regulatory costs and activities as well as all manufacturing and distribution costs of goods sold in Korea.  

Shield has also agreed a Feraccru®/Accrufer® Paediatric Investigational Plan (PIP)/Pediatric Development Plan (PDP) with the EMA/FDA, both culminating in the conduct of a study to evaluate the safety, tolerability and efficacy of the product in infants, children and adolescents. 

Shield said both initial stages of this plan have now been completed satisfactorily in the first half of 2021 and the main study is expected to start recruiting subjects in September 2021. 

Outlook 

Looking ahead, Shield said its 2H21 outlook will be dominated by the launch of Accrufer® in the US with its focus being on building awareness among healthcare providers, initiating prescriptions for appropriate patients, and extending patient access through payer groups. 

In Europe, Feraccru® sales are expected to continue to ‘grow steadily’ in Germany, the UK, Scandinavia and Belgium whilst progress is made on pricing and reimbursement in other countries.  

Meanwhile, in the Chinese market, the Group said ASK Pharm will start the Phase III study required for approval while Shield will start recruiting patients into the paediatric study. 

View from Vox 

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, the recent news that the company had acquired an additional listing on OTCQX market is expected to increase STX’s visibility to US investors ahead of Accrufer®’s launch.    

Reasons to  STX

Shield Therapeutics is 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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