Ipsen: Standalone strategy for Somatuline US + companion product for Dysport in LatAm

NEUTRAL, Fair Value EUR33 (-3%)

News published on January Tuesday 14, 2014
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Ipsen announced this morning two important pieces of news on two key products. On Somatuline, following the positive results of the CLARINET study in non-functioning neuroendocrine tumours (NETs), Ipsen has decided to set up its own oncology platform. We believe this makes sense for the company given the differentiated product profile of Somatuline and as well as Ipsen’s ambitions in the US to reach critical mass. Nevertheless, this will be done with significant investments of
EUR30-40m per year and therefore delaying breakeven from 2014 to 2017 in the US. Regarding Dysport, Ipsen has signed a licensing agreement to distribute Sativex in Latin America which will be an attractive companion drug for the botulinium toxin. We expect shares to be under pressure this morning given the dilution and execution risk while the standalone decision could provide long term value.

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