Resilience in Uncertainty: Pharma Mar and Intellego Lead European Tech Growth Through Strategic Investment

The European tech sector is navigating a challenging landscape of rising interest rates, geopolitical tensions, and uneven economic recovery. Amid this volatility, investors are seeking companies with resilient earnings growth and strategic R&D investments to sustain long-term value. Two standout candidates are PharmaMar (BME:PHM), a biotech leader leveraging marine-derived oncology therapies, and Intellego Technologies (OM:INT), a disruptor in UV disinfection systems. Both have delivered strong financial results while positioning themselves for future growth through targeted innovation and partnerships.

PharmaMar (BME:PHM): R&D-Driven Oncology Pioneer

PharmaMar's 2024 financials highlight its R&D intensity and operational resilience. The company reported a 11% revenue rise to €174.9M, driven by surging royalties (+18%) and licensing deals (+38%). However, its true strength lies in R&D, where it spent €103.5M—a 4% increase over 2023—to advance therapies like lurbinectedin (Zepzelca) and ecubectedin (PM14). This R&D spend represents 59% of total revenue, underscoring its commitment to cutting-edge oncology pipelines.

Key milestones include:
- Positive Phase III results for lurbinectedin in small-cell lung cancer, enabling a 2025 EU marketing authorization submission.
- Completion of a RNA interference (RNAi) production plant, expanding its toolkit for precision oncology.
- Strong cash reserves (€109M) to fund ongoing trials and regulatory pushes.

Despite a 6% dip in oncology sales due to European market adjustments, PharmaMar's net profit surged to €26.1M—a 2,273% jump from 2023—thanks to tax benefits and operational efficiency.

Investment Thesis: PharmaMar's deep R&D pipeline and upcoming regulatory approvals position it as a high-conviction play in oncology. While risks include dependency on key drugs and regulatory hurdles, its robust cash flow and strategic focus on niche therapies justify a long-term holding.

Intellego Technologies (OM:INT): Leveraging Partnerships in UV Disinfection

Intellego's 2024 results reveal a strategic pivot away from R&D spending toward partnerships and regulatory tailwinds. Despite zero reported R&D expenses for 2024, the company achieved 47% revenue growth (SEK 223M) through:
- A global collaboration with Henkel targeting the €16B UV-curing adhesives market.
- A Likang partnership in China's disinfection sector, with plans to expand into 3,000 hospitals.
- Regulatory mandates in China and beyond requiring UV dosimeters, driving demand for its YUVIO device.

Financial highlights:
- 66.2% EBIT margins in Q1 2025, reflecting strong operational leverage.
- A SEK 100M liquidity target by end-2025 to fuel production scaling and global expansion.
- A 5-year sales target of SEK 10B, achievable through recurring revenue models and partnerships.

While its lack of R&D spending may raise eyebrows, Intellego's focus on execution over experimentation aligns with its niche in UV disinfection—a market ripe for compliance-driven demand. Risks include FDA approval delays for its U.S. expansion and reliance on partner-driven revenue, but its high margins and clear growth path make it a speculative buy for investors with a 3–5 year horizon.

Why These Stocks Offer Compelling Risk-Adjusted Returns

1. PharmaMar:
2. Upside: EU approval for lurbinectedin by 2026 could unlock €100M+ in annual sales.

3. Risk Mitigation: Diversified pipeline (PM14, PM534) and cash reserves provide a safety net.

4. Intellego:

5. Upside: China's regulatory mandates and U.S. market entry could push sales to SEK 500M by 2025.
6. Risk Mitigation: High-margin, recurring revenue streams reduce dependency on R&D.

Both companies exemplify resilience in a volatile market—PharmaMar through R&D-driven innovation, Intellego through partnership-based scalability.

Final Take: Build a Balanced Portfolio

Investors should consider:
- PharmaMar (BME:PHM) for high-growth oncology exposure with a proven R&D track record.
- Intellego (OM:INT) as a regulatory-driven play in a niche tech sector.

Recommendation: Allocate 15–20% of a European tech portfolio to each, with PharmaMar as a core holding and Intellego as a speculative satellite. Both offer asymmetric upside in a market hungry for growth stories with tangible execution plans.

In a world of uncertainty, PharmaMar and Intellego exemplify how strategic focus—whether through R&D or partnerships—can turn volatility into opportunity.