ReNeuron Group PLC (AIM:RENE, OTC:RNUGF)’s house broker Liberum has restated a buy rating with a cash runway stretched out to 2024 following the AIM-listed biotechnology company’s recent restructuring.
In Liberum’s view: “The core investment hypothesis remains intact, and we believe that the selective delivery of complex drug modalities could be highly attractive to partners.”
Plotting a path beyond ReNeuron’s 2024 cash runway hinges on the successful monetisation of its exosome drug delivery system CustomEx, which uses proprietary stem cells to create highly customisable exosomes that be used to deliver next-generation target therapies for patients.
In a boost to ReNeuron’s prospects in securing licensing deals, Liberum noted signs of improvement in biotech deal making, with the S&P500 and Nasdaq Biotech indices having recovered 2022 losses.
ReNeuron is expected to hold around £6mln in cash at the end of the 2023 financial year, supported by tighter working capital management and 40% headcount reduction in January’s restructuring.
Underlying losses are expected to fall from -£8.1mln at the end of 2022 to -£6.5mln by the end of 2023.
Liberum reinstated its buy rating with a target price of 70p, revised down from 85p.