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Clinigen still clinical

Clinigen continues to revive acquired drugs and expand internationally
September 24, 2014

When drugs fail to obtain licenses or are pulled off the market, clinicians can miss out on vital elements of medical treatment. Clinigen (CLIN) fills this gap, acquiring, revitalising and then distributing the drugs. This focus helped it record a 20 per cent rise in underlying cash profits for the year to June.

IC TIP: Buy at 462p

Sales at Clinigen’s key clinical trials supply division fell 5 per cent to £84m, reflecting a one-off bump in anti-viral sales in 2013. But it did record a 45 per cent increase in supply requests, as it widened its market share, so sales should rebound. It also signed an exclusive supply agreement for an oncology drug with an international pharmaceutical company.

Clinigen’s specialty pharmaceuticals division grew its product range by acquiring Savene and Ethyol, two oncology support products. That should help to compensate for slowing sales of Foscavir now that the revitalisation of that drug is largely complete. Clinigen also convinced European regulators to lift the suspension order on its injectable antibiotic Vibativ, which combats hospital-acquired pneumonia.

Meanwhile, sales surged by more than half at its global access programs segment, as it shipped 58,000 drug units – up 87 per cent – to over 75 countries. The division also added AstraZeneca (AZN) and Eisai to its client list.

Broker Numis expects pre-tax profits of £29m, giving EPS of 26.1p, rising to £35m and 31.6p in 2015-16.

CLINIGEN (CLIN)
ORD PRICE:462pMARKET VALUE:£ 382m
TOUCH:460-463p12-MONTH HIGH:690pLOW: 359p
DIVIDEND YIELD:0.7%PE RATIO:24
NET ASSET VALUE:80p*NET CASH:£5.3m

Year to 30 JunTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
2010211.2nanil
2011356.8nanil
20128210.313.2nil
201312314.515.12.6
201412721.319.63.1
% change+3+47+30+19

Ex-div: 16 Oct

Payment: 07 Nov

*Includes intangible assets of £50.5m, or 61p a share