Translation: Original published in Finnish on 10/9/2025 at 7:15 am EEST.

Herantis' Phase 1b clinical trial achieved all its objectives. The most significant outcomes were good tolerability and safety of HER-096, as well as the drug candidate's anticipated pharmacokinetics. These results support advancing the drug to Phase II clinical trials, which will investigate safety and initial efficacy, and which Herantis plans to initiate in 2026. Due to the reduced drug development risk, we raise our target price to EUR 2.5 (previously EUR 2.1) based on the cash flow model. Our recommendation decreases to Reduce (previously Accumulate) as the sharp rise in the share price has weakened the expected return.

Endpoints related to safety and drug candidate behavior were achieved

Herantis is developing its HER-096 candidate as a disease-modifying drug for Parkinson's disease. In the longer term, the company also sees opportunities for the candidate to treat other neurodegenerative diseases, such as Alzheimer's disease.

HER-096 drug development is still in its early stages, and the objective of the now-reported Phase Ib was to gather information on the drug candidate’s tolerability, safety, and pharmacokinetics, i.e., how the drug behaves in the body. According to the topline data, the drug is well tolerated and safe in a limited group of healthy volunteers and patients with Parkinson's disease. The drug crossed the blood-brain barrier, meaning it reached its target in the central nervous system. HER-096 also remained in the central nervous system for a sufficiently long time, which is a prerequisite for the drug to have the desired effect. Regarding dosage, the company believes that a 300 mg subcutaneous dose administered twice weekly is the best option for the next research phase. The trial was not designed to assess efficacy, so no conclusions can be drawn in this regard.

The new results further support our previous assessment of the drug’s promising properties. In our opinion, these new results clearly support advancing to the next phase of development. This is included in Herantis' plans for 2026. The current study phase will be followed by a biomarker analysis by the end of the year. This analysis could help streamline drug development in future phases.

Funding is the key theme for the near future

The next significant step for the company is securing funding for the Phase II trial. Current funding will suffice until Q2'26. While the company has previously stated that it aims to enter into a partnership agreement with a larger pharmaceutical company, other financing options are also under consideration, according to the company. The strong results obtained now increase the likelihood of a successful partnership agreement.

Results increased the probability of success

We have already stated in our previous reports that the results support the continuation of the study. Reflecting this, in our H1’25 report, we had already raised the probability of Phase 1 success in our model to a rather high 75%. The results now obtained are thus in line with previously obtained results and our expectations. Given these positive results, we estimate that the risk profile of drug development has dropped another notch. Reflecting the reduced risk level, we are raising the probability of advancing to Phase II to 85%. The probability of commercialization is now 14% in our model. In our view, the main uncertainty in the near future relates to financing the forthcoming Phase II study.

Sharp price rise has weakened the risk/reward ratio

The increased probability of success is reflected positively in our DCF cash flow model, which values the share at EUR 2.5. However, the sharp rise in the share price in recent weeks exceeds our estimated increase in fair value, so we see the risk/reward ratio as having weakened since our last update (H1’25).