Why are you carrying out this distribution of shares to the owners?
- Initiator Pharma has acquired some substances from Saniona that we do not consider to be our core business. We have received 60 percent of the shares in Initiator Pharma which we are now distributing to the shareholders of Saniona. We believe this is the right way to create shareholder value for substances that we would otherwise have just been sitting idle.
How will the dividend be distributed technically?
- We are now holding an extraordinary general meeting on October 13. There we hope that we can decide to distribute the shares. For every share you own in Saniona, you will receive one share in Initiator Pharma. In this way, Initiator Pharma will be given approximately 4000 shareholders at once, which will give the company something of a jump start. The idea is then to list Initiator on AktieTorget during the autumn.
Will there be a new share issue in connection with the listing, and what will be the value of the company?
- The company will need capital, but how much is still uncertain. It is now up to Initiator's management team and board to decide this. I also expect them, together with their advisors, to set a value for the company. This will be clarified in the memorandum that will of course be issued before the listing on AktieTorget.
Can't you say anything about the value of the company?
- No, we don't want to guess. But it's free for anyone who wants to do so. There are many examples of similar companies that have been listed on AktieTorget, so it's probably possible to arrive at a reasonably probable amount. But at Saniona, we're not in the business of guessing.
When can we expect to see this memorandum?
- It will be in the fall. My impression is that they are working at full speed to make it happen as quickly as possible. But it will of course take some time before it is finished.
The notice states that Swedish shareholders will not receive any tax benefit from the dividend. Can you explain more?
- We have received a preliminary ruling from the Swedish Tax Agency, which assesses that this can be handled in accordance with Lex Asea. This means that Swedish shareholders will first pay tax in connection with a sale of the shares. For example, for Danish shareholders, of whom we have a large number, there will be a minor tax effect, according to a preliminary ruling from the Danish tax authorities. However, it is minimal – approximately DKK 0,015 (1,5 öre) per share.
What is Initiator Pharma actually supposed to do?
- They have purchased three substances from us that they intend to research and develop in the indication of erectile dysfunction. Most people probably immediately think of Viagra and that is partly right. But there is a very large group with erection problems that have never been helped by Viagra. It is up to 30 percent, so it is a very large group. Maybe 50-100 million on a global scale. These sufferers simply have a different type of problem and it is this group that Initiator Pharma is targeting.
In other words, the market for such a preparation is quite large?
- Yes, that's probably a bit diplomatic. The Viagra market is probably around 30-40 billion. There are currently no really good drugs to fix these problems. So it's a bit difficult to describe exactly how big the market is.
What do you think about the team at Initiator Pharma?
- This is a research and development team with a lot of experience. One of the founders has dedicated a large part of his career to focusing on the treatment of erectile dysfunction and is a leader in this field of research.
In conclusion, a lot has been happening in Saniona lately. What are you working on right now?
- Yes, that's right. The agreement with Boehringer in particular was an important milestone for us. Right now, we are working primarily on our study on Tesomet, which we hope to be able to show the first results in early 2017. Then we are working on listing Saniona on Nasdaq Small Cap Stockholm during the year. It is a very extensive process that we are in the middle of. And then there are a lot of other things going on. What we don't get much time for is leisure and rest, concludes Thomas Feldthus, laughing.
About erectile dysfunction
Erectile dysfunction affects more than 150 million men globally and the number is expected to rise to more than 300 million by 2025. Approximately 30-40 percent of men affected do not respond to existing treatments, such as Viagra and similar drugs, which means that the market Initiator Pharma is targeting represents a very large medical need.
Read a previous interview with Saniona's CEO, Jørgen Drejer, about the upcoming IPO of Initiator Pharma
The content of Biostock's news and analysis is independent, but Biostock's operations are to some extent financed by companies in the industry. This post refers to a company from which BioStock has received funding.
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