Equity research Pila Pharma H1 2026: From rat detour to clinical heat

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The EMA approval for an obesity trial with XEN-D0501 tablets represents a positive clinical reset following low drug exposure and inconclusive rat data with a previously untested liquid formulation presented earlier this year.  As the start of clinical development in obesity at higher, potentially more clinically relevant doses approaches, we expect to review our forecast and valuation assumptions in the coming months.

Targeting higher and longer dosing of XEN-D0501 in obesity

Needless to say, the most important recent highlight is the EMA approval to start the PP-CT04 clinical trial communicated last week. The regulatory go-ahead enables a 12-week, randomised, double-blind, placebo-controlled trial in people with obesity in up to 46 participants. As previously discussed, it is designed as a two-part Phase 1b/2a study. We are encouraged that the clinical trial application was approved fairly quickly, likely aided by the existing clinical and safety data for the clinical candidate XEN-D0501. Pila has not yet communicated timelines for the start and completion of PP-CT04, but we do not expect any major delays, as, e.g., Pila already has a sufficient inventory of XEN-D0501 tablets. We regard PP-CT04 as primarily a safety/tolerability and PK bridge to higher exposure. Some relevant patient groups in the obese indication, such as diabetic individuals and women of childbearing potential, are notably excluded from the trial but will probably be investigated in future clinical development. The most immediate question is whether the clinical tablet can generate substantially higher drug exposure over a longer period in obese participants without unacceptable tolerability issues. The trial’s efficacy endpoints are important, including effect on body weight, but the small part 1 “pilot” cohort (n=8) is not a robust test of efficacy on its own.

More clarity on clinical timelines and spend expected soon

Including a SEK 13m cash transfer to the Danish subsidiary, we approximate that the group’s cash consumption from operations in H1 2026 was largely in line with our expectations. Pila states that cash holdings on 30 June were SEK 3.3m for the parent company and SEK 10.1 m for the subsidiary. The combined disclosed cash balance was thus approximately SEK 13.4m on 30 June, versus SEK 19.3m on 31 December 2025.  The company reiterates that the current capital fund part 1 of the PP-CT04 trial. To complete the trial, including part 2, additional capital is required. However, as Pila already has an ample supply of clinical material and expects the dose expansion in Part 2 to be largely conducted at home, we believe clinical costs could be reasonably contained. This should, in turn, somewhat mitigate the capital required to complete the Phase 1b/2a trial in obesity.

Increased rate of development news flow will likely drive the share price

To conclude, as previously noted, Pila Pharma has stopped investigating a preclinical proof-of-concept study for obesity and is moving quickly to a higher-dose human exposure and tolerability test. The regulatory progress is thus clear, while the efficacy question on, e.g., body weight, remains open.

Awaiting further clarity on the start and expected timelines for the PP-CT04 clinical trial, as well as funding, we calculate a basically unchanged SEK 2.6 (2.5) per-share base-case valuation for now. However, we see potential for a positive review of our valuation in the coming months, for example, when the PP-CT04 clinical trial starts as planned.

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