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Genmab A/S

GMAB: XCSE (DNK)
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DKK 7,684.00RzbvzkhJfkvklwzn

Genmab: $1.8 Billion Acquisition of ProfoundBio Strengthens Oncology Portfolio; Shares Undervalued

Genmab announced it will acquire ProfoundBio, a privately owned clinical-stage biotechnology company developing antibody-drug conjugates, or ADCs, to treat certain cancers, for $1.8 billion in cash or approximately DKK 12.39 billion. The acquisition will give Genmab worldwide rights to three ADC candidates in clinical development, led by Rina-S, which is being evaluated in a phase 2 clinical trial targeting folate receptor alpha for treating solid tumors, including ovarian and endometrial cancer. Management anticipates Rina-S could be approved in 2027, generating additional upside potential toward the end of our 10-year forecast period. We anticipate Genmab’s operating expenses will be moderately elevated, which reflects the incremental research and development investment to support the advancement of ProfoundBio's clinical programs. Due to the relatively early stage of Rina-S and risks associated with the clinical development process, we maintain our fair value estimate of DKK 2,650 per share and view the stock as undervalued, currently trading in 4-star territory. Our narrow moat rating is based on Genmab’s intangible assets from the development of its cancer antibody therapeutics and strong patents covering Darzalex that do not begin to expire until 2031.

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