Arctic Bioscience (ABS.OL)

A High-Risk, High-Reward Bet on Psoriasis Treatment

Market Cap: ~USD 15 million (NOK 156 million)
Exchange: Oslo Stock Exchange (ABS.OL)

Arctic Bioscience is on the verge of a potentially transformative moment. The company is expecting results from its Phase IIb trial of HRO350, an oral treatment targeting mild to moderate psoriasis, within the next few weeks.

Why is this important? The global psoriasis market is projected to hit USD 45 billion by 2030. Around 125 million people globally are affected, with about 80% suffering from mild-to-moderate psoriasis. Yet this segment is severely under-served, as most available treatments – creams and salves – are inconvenient and often ineffective over time, leading many patients to abandon them.

An emerging trend in the dermatology space is the rising demand for effective and easy-to-use oral treatments. Severe cases are treated with expensive biologics, but the mild-to-moderate segment lacks convenient options.

This is where Arctic Bioscience steps in. Their product, HRO350, is an omega-3-based capsule derived from herring roe oil, containing specialized fatty acids with anti-inflammatory properties. If successful, it could offer a safe, accessible, and effective oral alternative for millions.

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Market Opportunity: A Conservative Breakdown

Assuming an addressable market of just 3 million patients (out of 125 million globally), and an annual treatment cost of USD 3,000, we can outline three scenarios:

Scenario 1 — Conservative Case

• Market Share: 3–5% (90,000–150,000 patients)

• Annual Revenue: ~USD 250 million

• Valuation (4–5x Price/Sales): USD 1–1.25 billion

• Upside from current market cap: ~8,000–10,000%

Scenario 2 — Base Case

• Market Share: 10%

• Annual Revenue: USD 600–900 million

• Valuation: USD 2.5–4.5 billion

• Upside: ~20,000–37,000%

Scenario 3 — Optimistic Case

• Market Share: 15–20%

• Annual Revenue: >USD 1 billion

• Valuation: USD 5+ billion

• Upside: 40,000%+

📌 Current share price: NOK 5.75
Potential price range: NOK 400–2,000+

Even achieving just 11% of a 3-million-patient addressable market – out of the total 125 million people globally with psoriasis – would generate USD 1 billion in revenue, illustrating just how powerful moderate adoption could be.

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But What About Risk?

The path to regulatory approval is long and uncertain. In dermatology, the average Phase IIb success rate is around 30–40%. If successful, the Phase III trial carries a 50–60% chance of approval. This means a combined probability of success of 15–25%.

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Final Thoughts

If HRO350 succeeds through the current Phase IIb and a later Phase III study, Arctic Bioscience could fill a massive gap in the global psoriasis market.

Biotech companies with successful dermatology treatments often command high valuations due to recurring revenues and loyal patient bases.

Is this a long shot? Yes. But with asymmetric potential returns, it could be a calculated bet worth considering – a biotech lottery ticket with the potential to deliver outsized rewards.

Results are expected by the end of April.

Stay tuned.

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Disclaimer: This article is for informational and educational purposes only and does not constitute investment advice. Always conduct your own research or consult a financial advisor before making investment decisions. The author may hold positions in the mentioned securities.