Flow of regulatory approvals

Diurnal is a commercial-stage specialty pharmaceutical company focused on diseases of the endocrine system. Its products are targeting rare conditions where medical need is currently unmet, with the long-term aim of building an “Adrenal Franchise”. Alkindi® is currently being rolled out throughout Europe, and recent approvals in Israel and Australia will open up more markets. Approaching next month, all attention will turn towards the US, where the PDUFA date has been set for 29 September. Upfront cash from the US commercial deal with Eton Pharmaceuticals (Eton), together with the recent Placing, has strengthened the balance sheet.

• Strategy:  Diurnal’s goal is to create a valuable “Adrenal Franchise” that can treat patients with chronic cortisol deficiency diseases from birth and for the rest of their lives. The long-term vision, once Alkindi and Chronocort are established in Europe and the US, is to expand the product offering to other endocrine conditions.
•  Trading update:  Diurnal has announced that Alkindi sales increased 130% to £2.39m (£1.04m) in fiscal 2020. The $3.5m cash upfront payment from Eton, together with the recent £11.2m (gross) Placing, has left the company with £15.4m cash at 30 June, about £0.8m higher than our forecast (adjusted).
• Regulatory update:  Diurnal has received regulatory approval of Alkindi in both Israel and Australia; it will be launched in 2021 by partners Medison and Emerge, respectively. Attention over the next month will be focused on the PDUFA date, where Alkindi will be considered by the FDA advisory committee.
• Risks:  Ideally, Diurnal would have liked to sign a deal that also included rights to Chronocort. Given the deal with Eton, this is now going to be a two-stage process, and Diurnal will continue to seek a partner for the US development and commercialisation of Chronocort. This could be with Eton or another party.
• Investment summary:  Diurnal has not participated in the recent COVID-19- related biotech bounce, despite all the recent good news. A positive recommendation for approval from the FDA advisory committee in September would be a significant step forward and signal likely approval form the FDA, which would represent a significant value inflection point.