Sosei Group Corporation Announces Operational Activities and Consolidated Results for 2023
Sosei Group Corporation recently announced its operational activities and consolidated results for the year ended December 31, 2023. The biopharmaceutical company, known for its GPCR-targeted StaR® technology and structure-based drug design, received a significant boost with an investment of approximately JPY 8 billion (~USD 54 million) from the new OPF1 fund operated by JIC Venture Growth Investments Co., Ltd. This injection of funds, combined with a share offering and convertible bond restructuring, will fuel the company’s strategic growth, extend its debt maturity profile, and strengthen its financial foundation.
In terms of recent achievements, Sosei Heptares secured marketing approval for PIVLAZ® in South Korea. This milestone approval paves the way for preventing cerebral vasospasm after subarachnoid hemorrhage. Moreover, the company submitted a New Drug Application in Japan for daridorexant, an innovative treatment for insomnia. This development contributed JPY 1.5 billion to the company’s revenue in the fourth quarter of 2023.
Collaborative efforts with industry giants such as Pfizer, Neurocrine, Genentech, Kallyope, Verily, and PharmEnable Therapeutics have also played a pivotal role in Sosei Heptares’ success. These partnerships have resulted in new clinical trials and milestone payments, enhancing the company’s research and development activities.
Notably, the strategic acquisition of Idorsia Pharmaceuticals Japan Ltd and Idorsia Pharmaceuticals Korea Co., Ltd has significantly strengthened Sosei Heptares’ commercial operations in Japan and the Asia-Pacific region. This acquisition not only brings experienced teams on board but also grants the company rights to two medicines with promising growth potential.
Financially, Sosei Heptares faced a decrease in revenue, reporting JPY 12,766 million (US$90.8 million) for the year. This decline is primarily attributed to fewer partnership agreements and milestone events compared to the previous year. Meanwhile, research and development expenses amounted to JPY 10,075 million (US$71.7 million), with general and administrative expenses reaching JPY 9,965 million (US$70.9 million), reflecting the costs associated with discovery activities and M&A-related expenses. Consequently, the company reported an operating loss of JPY 9,526 million (US$67.8 million), transitioning from a profit the previous year. The net loss for the year stood at JPY 7,193 million (US$51.2 million). However, it is worth noting that despite these setbacks, Sosei Heptares maintained robust cash and cash equivalents, amounting to JPY 49,065 million (US$347.9 million).
Looking ahead, 2024 promises to be a year of development acceleration for Sosei Heptares. The company’s strategic expansion efforts and investments in technology and its product pipeline indicate its readiness to tackle upcoming challenges and seize new opportunities.
Analyst comment
Positive news: Sosei Group Corporation receives a significant boost in investment, secures marketing approval for PIVLAZ® in South Korea, and submits a New Drug Application for daridorexant. The company’s partnerships with industry giants have also enhanced its research and development activities. The strategic acquisition of Idorsia Pharmaceuticals strengthens its commercial operations. Despite a decline in revenue, the company maintains robust cash and cash equivalents. The market is expected to respond positively as Sosei Heptares focuses on development acceleration and seizing new opportunities in 2024.
