IXICO expands contract with top 10 pharmaceutical company

(Sharecast News) - AIM-listed data science company IXICO has signed an expanded scope to a current contract with a top 10 pharmaceutical company three months into the contract.Additional services will be provided, bumping up the contract's value by £600,000 to £1.6m over the three-year term. The original contract was announced on 14 May 2018.As the lead image analysis partner in the study, IXICO will apply its proprietary approaches to data science, together with in-licenced algorithms from leading academic centres, to measure neurological outcomes in study participants. The expanded scope will see the group provide additional analysis based on advanced imaging modalities in a natural history study of people with early manifestation of Huntington's disease.Chief executive Giulio Cerroni said: "I am delighted that our client has decided to expand our involvement at such an early stage of this important study. We value the strength of our relationships with pharmaceutical companies and our ability to provide them with important insights to support their efforts to bring new medicines to market."Shore Capital said: "We continue to see IXICO as a compelling opportunity to gain exposure to a high-growth business with accelerating momentum and a management team that is focused on commercial delivery."We acknowledge the challenges in fairly valuing a loss-making business, and hence with profitability on the horizon (2021F based on our forecasts) we use a blended approach, with a fundamental discounted cashflow (DCF) indicative of the longer-term opportunity (assuming management continues to deliver on its operational targets) and a sales-multiple to capture the existing business. Our unchanged 49p/share fair value suggests circa 50% upside from current levels."At 0950 BST, the shares were down 7.7% to 30.01p.