More deals will come for Futura Medical PLC (AIM:FUM), which earlier on Tuesday said it had inked an agreement to commercialise its fast-acting erectile dysfunction (ED) gel in Brazil and Mexico.
That at least is the opinion of City broker Liberum, which reiterated its ‘buy’ recommendation and 102p a share price target following the tie-up with m8 Pharmaceuticals.
“Futura is talking to many more potential partners as it works to build the global commercialisation landscape, and we expect more licensing agreements to be signed in the coming months,” said Liberum in a note to clients.
Earlier investors were told Futura would receive milestone payments of US$8.5mln as part of the transaction, including a small sum paid upfront.
m8, meanwhile, will be responsible for all local development and regulatory costs related to Futura’s ED treatment MED3000.
Liberum said of the LatAM tie-up: “m8, although based in the US, is a specialist in LatAm pharmaceuticals.
“Futura is keen to sign partners for MED3000 that will have a long-term commitment to the product and will be willing to invest to maximise the value of the product.
“m8 fits that bill, and the deal is structured appropriately to allow m8 to fully invest in the MED3000 launch.”
Late morning, Futura shares were changing hands for 40p, up 4%. The Liberum price target suggests there is 150% upside from current levels. Its current sum-of-the-parts valuation does not factor in the LatAm deal announced earlier.