Clinigen Share Discussion Threads

[3rd eye] 19/3/2015 08:30

Clinigen Group PLC (CLIN) – Investment Analysts’ Weekly Ratings Updates

Posted on March 13, 2015, updated 18 March 2015, by Stefani Robinson in Analyst Articles - Company Sum, Investing


Clinigen Group PLC logoSeveral analysts have recently updated their ratings and price targets for Clinigen Group PLC (LON: CLIN):

3/11/2015 – Clinigen Group PLC had its “buy” ratingreaffirmed by analysts at N+1 Singer. They now have a GBX 590 ($8.89) price target on the stock.
3/3/2015 – Clinigen Group PLC had its price target raised by analysts at Numis Securities Ltd from GBX 650 ($9.79) to GBX 770 ($11.60). They now have a “buy” rating on the stock.
3/3/2015 – Clinigen Group PLC had its “hold” rating reaffirmed by analysts at Investec.
2/27/2015 – Clinigen Group PLC had its “buy” rating reaffirmed by analysts at N+1 Singer. They now have a GBX 549 ($8.27) price target on the stock.
2/11/2015 – Clinigen Group PLC had its “buy” rating reaffirmed by analysts at N+1 Singer. They now have a GBX 549 ($8.27) price target on the stock.
2/11/2015 – Clinigen Group PLC had its “buy” rating reaffirmed by analysts at Oriel Securities Ltd. They now have a GBX 650 ($9.79) price target on the stock.
2/3/2015 – Clinigen Group PLC had its price target raised by analysts at Investec from GBX 530 ($7.98) to GBX 546 ($8.22). They now have a “hold” rating on the stock.
1/15/2015 – Clinigen Group PLC had its “buy” rating reaffirmed by analysts at N+1 Singer. They now have a GBX 500 ($7.53) price target on the stock.
1/15/2015 – Clinigen Group PLC had its “buy” rating reaffirmed by analysts at Numis Securities Ltd. They now have a GBX 650 ($9.79) price target on the stock.
Clinigen Group PLC (LON:CLIN) traded up 0.70% on Friday, hitting GBX 532.71. The stock had a trading volume of 29,042 shares. Clinigen Group PLC has a 52-week low of GBX 354.92 and a 52-week high of GBX 574.38. The stock has a 50-day moving average of GBX 524. and a 200-day moving average of GBX 500.. The company’s market cap is £439.76 million.

Clinigen Group plc (LON:CLIN) is a specialty pharmaceuticals and services business company. The Company operates in three segments: Clinical Trial Supply, Specialty Pharmaceuticals and Global Access Programs. Clinical Trial Supply division is involved in the sourcing and supply of comparator products for Clinical Trials.

[cfro] 17/3/2015 10:23

A couple of sellers obviously hit the share price a little. However, there is plenty of demand for the shares and in my experience the share price does tend to sometimes trade all over the place...

What we need is a drug acquisition RNS, of which, should move the share price back up sharpish imo.

[aim_trader] 17/3/2015 10:05

CEO Peter George will present at the Chesterfield on 26th March. To register:

[mike740] 16/3/2015 13:49

hmmm might have a few more then, cheers.

[nhb001] 16/3/2015 12:31

The interim dividend is 1.1p so that certainly doesn't account for the drop! I agree with the last comment - there is probably a large sell going through. Probably the founder or one of his ilk. Probably a buying opportunity if you are so inclined and have some spare funds.

[pyemckay] 16/3/2015 12:22

might be a large sell going through but its noise unless you ar trading this.

[blueliner] 16/3/2015 12:11

XD strange date ? you needed to be on the register on Fri 13th.

Doesn't account for the 4% fall though.

[woolybanana] 16/3/2015 11:55

ex dividend

[mike740] 16/3/2015 09:36

Why the fall this morning?.

[cfro] 13/3/2015 13:57

That is an exceptional write-up from shares mag. Thanks for the article.


'Aiming to be a ten product company in four years..'


It better get a shift on then.....;-)

edit - by the looks of things the shares mag article is having an effect on the share price :-)

[hutch_pod] 13/3/2015 09:05

Wow. CLIN's business in plain English - quality description.

Think the £8.8m H1 2015 underlying profit referred to is post tax, with underlying pre-tax at £11.1m?

Even still, Numis are pretty confident to forecast £28.8m for the year.

[gargleblaster] 12/3/2015 21:32

Here is the Sh mag article:

Clinigen is a healthy trade

Three divisions drive profit growth at niche drug supplier
It doesn’t develop medicines, but Clinigen Group (CLIN:AIM) is making huge profits from the growing demand for pharmaceuticals.
The group supplies drugs for clinical trials as well as unlicensed medicines and niche treatments. It operates through three divisions:
• Clinical Trials Supply
• Global Access Programmes
• Speciality Pharmaceuticals
The Burton-on-Trent-based group was established in 2010 by chief executive officer (CEO) Peter George and today has offices in London, the US and Japan. It floated on AIM in 2012 (25 Sept) and investors buying on admission and holding will have seen their shares grow 227.7% in value to 537.5p.
Clinical Trials Supply
The first of Clinigen’s three revenue streams is supplying drugs for use in clinical trials. Before a company can sell a drug it needs to prove that it is safe and that it works. This involves a three-phase clinical trial process.
During the trials a new drug will be given to half of the participants, while the other half receives the market-leading product. A placebo is used if no approved drug exists. Clinigen provides the comparative drug along with any other treatments the participants need for their wellbeing during the trials.
This is not a case of walking into a chemists and picking the desired treatment off a shelf. Clinical trials are heavily controlled environments to help produce accurate results. This not only applies to the participants, who are typically aged between 18 and 60 and have not received any other treatment for the condition, but also the drugs used.
Those conducting the tests do not want a statistical variant in the results, so every drug used in a study will have been manufactured as one batch. If you source the comparator drug from the market instead of the manufacturer you could end up with a 100 different batches and potentially introduce a statistical variant.
Then there is the global nature of clinical trials. If a participant lives in Lithuania giving them French language pack could mean they take the wrong dosage, potentially ruining the test results.
So Clingen’s expertise is sourcing and supplying drugs in a controlled environment. Clinical trial drug supply is a $2 billion market, according to Peter George. Clinigen has $160 million, or 8%, of that market. Some pharmaceuticals source the drugs needed for the trials themselves, but there are many who do not have the expertise.
Global Access Programmes
A doctor has the right to treat a patient with what they believe is the most appropriate drug. If a patient suffering from a rare cancer, for example, fails to respond to all of the approved treatments in that country then a doctor has the right to prescribe a drug that is not licensed in the market. This is where Clinigen’s Global Access programmes business plays an important role. It specialises in supplying drugs that are not available in certain markets.
Clinigen’s Global Access programme has exclusive supply agreements with manufacturers. Counting the five drugs it owns, the group holds 41 different drugs in its warehouse ready to meet demand. It then manages the steps a doctor must take to get a drug, such as the paperwork to prove an un-met need, as well as the logistics of getting a product from its warehouse to the patient. In the six months to the end of December 2014, the division supplied 36,000 drugs.
Clingen’s skill is understanding different regulations and customs forms allowing it to successfully ship drugs to more than 80 countries. It’s no good a patient being prescribed a potently life-saving drug if it gets stuck in Singaporean customs, for example.
There are various reasons why a drug is available through this programme. One is that a treatment has been withdrawn from the market. Clinigen supplies such a drug in Germany that has been withdrawn over a pricing dispute. The manufacturer continues to produce the drug because it benefits patients and there is a demand.
The catch is that in this market Clinigen cannot promote the unlicensed drugs in its warehouse. The company does not have a sales team approaching doctors offering their treatments, the request has to come from a medical professional. Word of mouth creates demand. Key opinion leaders meet other professionals at conferences and discuss how to get hold of certain treatments. It can also publish press releases with a company that has given it the rights to run an access program for one of its drugs.
Speciality Pharmaceuticals
Clinigen not only supplies other company’s treatments, it sells five of its own. The group does not develop drugs, its buys the rights to existing treatments that George describes as ‘unloved’;.
Clingen buys drugs it believes it can revitalise. It targets at least doubling turnover within three years from acquisition. It bought anti-viral Foscavir from AstraZeneca (AZN) where it was making £4.5 million in sales. Two years later Clinigen is selling £23 million worth of the drug.
Clinigen looks for drugs that are being used off-label, which is treating a condition that it’s not licenced to do. The group then brings that usage on-label, meaning it is used more extensively. This is what happened with Foscavir. The drug is an HIV treatment, but it was also being used to treat infections in bone marrow transplant patients. It was only licenced for HIV, but Clinigen has bought the bone marrow transplant on-licence and so more and more people are using it. The drug also suffered from a shortage of supply under its previous owner which George and his team have sought to rectify to ensure it is included in treatment protocols.
Another drug that George has bought for its potential is oncology treatment Cardioxane. It has a safety warning which limits its use. George claims to have ‘lots and lots’ of evidence that suggests the safety warning is inappropriate. The safety warning is the result of a study involving eight patients, but Clinigen claims to have evidence from 13,000 people that refutes the assumptions drawn from the smaller study. It is hoped that getting the warning lifted will extend the drug’s use and thus its revenues.
(Click on chart to enlarge)

The figures
In the six months to 31 December 2014 Clinigen’s growth was impressive, despite a decline in Global Access revenues. Clinigen made an £8.8 million underlying pre-tax profit, a 10% rise on the same period a year earlier. This was the result of a 17% rise in sales to £72.6 million. The group has £12.9 million of net cash.
Revenues in its clinical trials business grew 28% in the first half, while specialty pharma sales were 21% higher year-on-year. Global access turnover dived 29% following the end of a large French programme, but gross profit still improved 3.5% on winning new business.
Clinigen is set for a stronger second half, according to Numis’ analysts. The group is expected to report a £28.8 million pre-tax profit for the year to June 2015, according to Numis’ forecasts, and is expected to return 3.4p a share to investors in dividends.
What’s the strategy?
Organic growth is the focus for Clinigen’s clinical trials supply business. Its bid to remain a market leader could see the addition of added-value services. To become the leader in the Global Access market, the group will have to grow revenues at least three-fold, which could involve M&A.
Acquisitions will play a huge part in expanding its speciality pharma division. Clinigen’s aim is to be a 10-product company in the next four years.

On a June 2015 price-to-earnings ratio of 20.7 Clinigen might be considered a high rating but the stock provides a lower risk and profitable play on rising pharmaceutical demand.
BROKER CONSENSUS

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[cestnous] 12/3/2015 14:24

This drop could be partially due to I.C. saying 'recovery' was complete, take profits, last week. Since when was this a recovery stock? Growth, surely. Been in a long time and staying.

[cfro] 12/3/2015 13:53

Not yet caught up with the shares mag article so looking forward to that.

On a different note i actually thought the recent Interims were very positive and to me the future is looking very bright here.

I have been buying back in lately on the back on the good news that continues to flow.

I can't see there being too long before they announce another drug acquisition which, imo, will most likely give the share price a proper kick.

[cestnous] 12/3/2015 12:42

Excellent 2 page writeup and buy rec. in "Shares" Under the bonnet feature today.
Probably the most succinct synopsis of the business I have read.

[apad] 11/3/2015 08:54

News on Foscavir licence this morning.
apad

[mike740] 06/3/2015 09:06

CLIN present Broker Views........

Date Broker Rec. Price Old target price New target price Notes
06 Mar 15 N+1 Singer Buy 544.00 - - Retains
03 Mar 15 Investec Hold 544.00 546.00 - Under Review
03 Mar 15 Numis Buy 544.00 650.00 770.00 Reiterates
27 Feb 15 N+1 Singer Buy 544.00 549.00 549.00 Retains
18 Feb 15 Oriel Securities Buy 544.00 650.00 650.00 Reiterates

[apad] 05/3/2015 18:55

I'm puzzled. I would have thought there would have been a better response to the results and the AZN contract. I'm missing something.
apad

[mike740] 05/3/2015 08:13

Download full Edison Note from link.......

[mike740] 05/3/2015 08:07

Clinigen Group - Continuing progress across all three divisions Click for report
Clinigen has reported solid H115 results that confirm progress is being maintained as expected. All three divisions are now well placed to maintain attractive organic growth rates over the medium term, while acquisitions to bolster the geographic footprint and add new products should provide periodic boosts. Our valuation uses a combination of earnings metrics and a DCF model, resulting in a range of £479-550m (580-666p a share).
Clinigen is a specialty pharmaceuticals and services business with three operating divisions: CTS provides a clinical trial supply service globally; GAP provides patients with difficult to access medicines; and Specialty Pharmaceuticals sells niche drugs.
Year end Revenue PBT EPS DPS P/E Yield
(£m) (£m) (p) (p) (x) (%)
06/13 122.6 20.4 20.4 2.6 27.0 0.5
06/14 126.6 23.1 21.4 3.1 25.7 0.6
06/15e 150.3 23.8 22.5 3.3 24.4 0.6
06/16e 170.7 31.0 29.0 4.0 19.0 0.7
Clinigen Group is a research client of Edison Investment Research.

[hutch_pod] 04/3/2015 12:27

True, though last year had the CTS revenue decline which spooked the market.

[firtashia] 04/3/2015 11:20

Well, what a difference a year makes. Last year an "in line" statement triggered a collapse in the share price, this year a similar statement is greeted with cautious optimism by the market. Anyone wanting an example of market irrationality should look here. The business still keeps doing what it says its going to do and until that changes I'll keep holding. Still think the current price is expensive though so wont be adding to my holdings.

[aishah] 03/3/2015 16:01

Clinigen has reported solid H115 results that confirm progress is being maintained as expected. All three divisions are now well placed to maintain attractive organic growth rates over the medium term, while acquisitions to bolster the geographic footprint and add new products should provide periodic boosts. Our valuation uses a combination of earnings metrics and a DCF model, resulting in a range of £479-550m (580-666p a share).

[gucci] 03/3/2015 15:29

one of Jim Slaters fav too

[gswredland] 03/3/2015 10:39

Thank Mike