RedHill Biopharma targets UK approval for H. pylori therapy

RALEIGH, N.C. - RedHill Biopharma Ltd. (NASDAQ: RDHL), a specialty biopharmaceutical company currently trading at $3.01, today announced plans to submit a Marketing Authorisation Application (MAA) in the UK for its Helicobacter pylori (H. pylori) infection treatment, Talicia. According to InvestingPro analysis, the stock appears undervalued despite experiencing significant volatility, with a notable 7.89% gain over the past week. The submission will utilize the Medicines and Healthcare products Regulatory Agency’s (MHRA) International Recognition Procedure (IRP), a fast-track approval process that references the U.S. Food and Drug Administration’s (FDA) prior approval of the drug. If successful, the company expects to receive UK approval for Talicia by the fourth quarter of 2025.

Talicia is a low-dose, rifabutin-based therapy that addresses H. pylori resistance to other antibiotics. It is the only FDA-approved treatment of its kind and is listed by the American College of Gastroenterology (ACG) as a first-line treatment option. Talicia has already been launched in the United Arab Emirates (UAE) and could pave the way for approvals in additional countries that recognize UK MHRA approvals.

H. pylori infection is a significant health concern, affecting about 40% of the UK adult population, a third of the U.S. adult population, and over 50% of the global adult population. The World Health Organization (WHO) classifies H. pylori as a Group 1 carcinogen and the strongest known risk factor for gastric cancer. InvestingPro data shows RedHill maintaining a gross profit margin of 34.04%, with analysts forecasting significant sales growth for the current year. Subscribers can access 16 additional ProTips and detailed financial metrics to better understand the company’s growth trajectory.

Dror Ben-Asher, RedHill’s CEO, highlighted the resistance to clarithromycin and levofloxacin, common antibiotics used in H. pylori treatment, which has led to high treatment failure rates. Talicia offers a treatment option with superior efficacy, minimal resistance, and a convenient dosing schedule that promotes adherence. Ben-Asher expressed the company’s commitment to expanding global access to Talicia, emphasizing the potential of the UK market and ongoing discussions with potential commercialization partners.

Talicia, approved by the FDA in November 2019, combines two antibiotics, amoxicillin and rifabutin, with a proton pump inhibitor, omeprazole. The drug is protected by U.S. patents until 2034, with additional patents pending and granted in various territories worldwide. While the company faces near-term cash flow challenges, InvestingPro analysis suggests potential profitability improvements, with analysts projecting positive earnings for the current fiscal year. Discover comprehensive financial health metrics and expert insights with an InvestingPro subscription.

The information in this article is based on a press release statement from RedHill Biopharma.

In other recent news, RedHill Biopharma Ltd. reported a decline in net revenues for Q1 2022, with figures dropping to $18.2 million from $22.1 million in the previous quarter. Despite the revenue dip, the company maintained a gross profit of $10.2 million, reflecting a solid gross margin of 56%. RedHill has implemented significant cost-cutting measures, reducing R&D expenses from $5.9 million to $3.1 million and cutting operating cash use by over 70% to approximately $4 million. The company is targeting positive cash flow from operations in the second half of 2022, supported by a comprehensive cost reduction plan aiming for $50 million in savings over 18 months.

Additionally, RedHill Biopharma has entered into a licensing agreement with Hyloris Pharmaceuticals SA for the global development and commercialization of RHB-102, excluding North America. This deal could be worth up to $60 million in milestone payments, plus royalties on sales. RedHill retains the rights to develop the drug for FDA approval in the United States. The collaboration with Hyloris follows positive feedback from the UK’s Medicines and Healthcare products Regulatory Agency, indicating a clear path for a Marketing Authorization Application in the UK.

In other developments, RedHill is exploring potential acquisitions of revenue-generating products and seeking external funding for its R&D programs. The company remains focused on achieving earlier profitability and is implementing strategic cost-cutting measures to navigate the challenges in the biotech sector.

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