LONDON, Dec. 21, 2018 (GLOBE NEWSWIRE) -- ReNeuron’s (RENE) H119 results highlighted cash of £30.7m, allowing it to execute on its ongoing clinical trials, although execution will bring a funding requirement in 2020. Operating expenses – expected to accelerate in H219 – resulted in total operating costs of £10.1m (vs £10.8m in H118) reflecting clinical study investment. Other operating income was a welcome buffer. Our revision of the clinical timelines has deferred revenues and moved our valuation to £192m or 608p per share from £280m or 885p per share.
We made two sets of changes to our model ahead of ReNeuron’s interim results. Updating FX rates and carrying forward the recent R&D tax credit rate had minor effects (c £6m), reducing our estimated post-tax loss by c £7.0m in FY19 and FY20. More materially, the delayed start dates of ReNeuron’s clinical studies and the requirement for two pivotal studies defers our estimated launches and positive cash flows until 2023 or 2024, depending on the product. The delay to the sales/royalty cash flows has a greater effect on our valuation than the R&D tax rebates, reducing our rNPV valuation to £192m or 608p per share from £280m or 885p per share, highlighting a c £10m funding requirement in 2020.
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