Redeye raises its Base Case slightly following the positive conclusion of the phase I trial with laquinimod.

Redeye raises its Base Case to SEK3.0 (2.8) as the phase I trial of the new eye drop formulation of laquinimod was successful. Laquinimod is being developed as a treatment for inflammatory eye diseases, in particular uveitis. The full results will be published during H1 2023. Laquinimod's safe profile as an oral treatment has already been established in earlier trials, so we expected the new eye drop formulation to be safe (by assuming a probability of success of phase I of 90%). The next step will be a phase II trial in which laquinimod is tested on patients. We await information about the design and funding of this trial.

Active Biotech

* Active Biotech is a pre-revenue company that generates negative cash-flow.

* The company is dependent on capital markets and key individuals. 

* The programmes are high-risk due to binary outcomes of clinical trials.

* Having a patented product on a regulated market usually means stable incomes once approved and running.

* Possibility of receiving upfront, milestone payments and royalties without further investments on the part of the company.

* Patents provide a clear moat.

* The cash position lasts less than a year.

* The company scores no points on financials.

* Limited execution track record: The management team has a tenure of less than five years, and previous programs have failed, though they've been repurposed.
* Financial constraints: The company lacks income, cannot afford dividends, and relies on frequent rights issues for funding, potentially diluting shareholder value.
* Weak sustainability focus: There's no apparent commitment to sustainability reporting or ESG-related incentives in executive compensation plans.
* Low insider ownership: Management and board members collectively own less than 10% of shares, potentially misaligning their interests with those of shareholders.
* Lack of gender diversity: The board of directors has no female representation, potentially limiting diverse perspectives in decision-making processes.

* Strong industry expertise: The CEO has decades of experience in drug development and partnering, demonstrating deep knowledge of the sector.
* Lean and innovative organization: The company operates with a virtual business model, focusing on innovative drug development and repurposing existing molecules.
* Transparent communication: Management is open and honest about challenges, consistently communicates long-term value creation, and provides timely business updates.
* Balanced executive compensation: The CEO's pay is less than 200% of the next highest-paid executive, indicating a more equitable distribution of compensation.
* Board independence and expertise: Directors are independent of management, can challenge decisions, and possess relevant scientific and pharmaceutical experience aligned with the company's strategy.