Maintaining Our SEK 203 FVE for Sobi Following In-Line Q3

We’re maintaining our SEK 203 fair value estimate for Sobi following third-quarter results that put it on track to meet our estimates for the year, although we continue to see significant competition on the horizon that could prevent the firm from establishing a moat. Sobi’s overall third-quarter revenue of around SEK 4 billion represented 6% growth as reported, and a 6% decline excluding currency tailwinds, as coronavirus-related sales and trends from the prior year have declined. Sobi’s biggest division, hematology, saw 14% revenue growth in the quarter (3% at constant currencies), with growth for Doptelet and Aspaveli countering pricing weakness for hemophilia drug Elocta. Immunology revenue fell 7% (22% at constant exchange rates) due to the absence of Covid-related sales for Kineret as well as a later start to the RSV season (reducing year-over-year comparisons for prophylactic antibody Synagis). In addition, Gamifant’s growth appears stagnant, with revenue flat for the first nine months of the year on a constant currency basis, and we think future growth will be reliant on new indications. That said, we still think the firm is on track to meet management’s confirmed guidance for EBITA margin in the low thirties (we model 31%) and constant currency growth in the mid-to-high single digits (we model 16% growth as reported, with currency tailwinds).