Ulisse BioMed (UBM) has developed three technology platforms that offer great potential, having wide applications in molecular diagnostics and immunoassay. Its most developed product – a polymerase chain reaction (PCR) test for coronavirus – is already being manufactured, with other diagnostic tests following shortly on the same platform. Two other technologies involve nanoswitches and aptamers; these have great potential, but they will be developed further in the future. We forecast UBM to be continuously EBITDA-positive from 2021 onwards. Following the successful IPO, it has a strong balance sheet.
- Revenues: UBM’s molecular diagnostic coronavirus test, CoronaMelt, has several advantages over other tests, being more sensitive and more accurate, and it can work without the purification step, making it faster and cheaper too. UBM has signed an agreement with a large Italian firm, Menarini, to commercialise this and future viral respiratory disease tests.
- Future: Ulisse BioMed has also developed tests for HPV and some STDs. These are currently for research use only (“RUO”). It has further created a diagnostic platform, using nanoswitches, which outperforms the current gold standard test for monitoring biological drugs, helping to reduce both side effects and drug costs.
- Valuation: Valuing such early-stage businesses is extremely difficult. We have used both a DCF model and comparable company EV/revenue analysis. The DCF derives an equity market value of €42m to €53m, or €5.17 to €6.56 per share, and the peer comparable value is €56m, or €6.87 per share.
- Risks: While diagnostic tools do not have to follow the same stringent trials as new drugs, they still require approval, and only a few of UBM’s products are approved for commercial usage in the EU. Other products require both further successful development and commercial partners; neither is guaranteed.
- Investment summary: Ulisse BioMed has developed three separate technology platforms, addressing three large and fast-growing markets. It has also developed some products on these platforms, mostly in the field of diagnostics, which have superior characteristics – speed, accuracy, simplicity – to the current solutions. Having raised €5m in a successful IPO on AIM Italia, UBM is well-placed to commercialise them and fund the ongoing development of new solutions.