ASX cracks down on coronavirus claims

The ASX is cracking down on biotech and health companies disclosures around possible coronavirus-linked products.

Yesterday TBG Diagnostics (ASX:TDL) was suspended as the ASX looks into why it waited until Wednesday to reveal that a COVID19 diagnostics test had been approved for sale in Europe.

TBG received the news on the Saturday prior and its stock shot up 170 per cent in the two days it took to go into a trading halt on Tuesday.

Skin Elements (ASX:SKN) has now been questioned about a vague statement it made in its half year report about a new product launch for an antimicrobial liquid it’s dubbed Invisi Shield.

“The company confirms its development program involving its Invisi Shield skin medical range has seen the consolidation of market testing on its product. This is being brought forward for immediate release given the global issues associated with the COVID-19 pandemic,” was all it told investors in early March.

In four days its stock more than doubled to 2.5c.

Skin Elements said this news was not material, despite the run on all stocks that mention the words ‘hand sanitiser’ that began in February, because of the highly competitive nature of the industry now, the low barriers to entry, and the fact it is yet to secure sales contracts.

The company gained control over the project in February after two months of due diligence, has two hand sanitisers in manufacturing and one that it’s formulating.

The ASX is also concerned about the auditor saying in the half-year accounts that there was material uncertainty on the company’s ability to continue as a going concern, and that it was not able to put a value on the intangible assets.

“We were unable to satisfy ourselves as to the appropriateness and reliability of the forecast of future cash flows that was included in the impairment model,” it said.

Skin Elements said it had complied with corporate reporting standards and believed it could lift sales to levels comparable with prior years now that it had sorted out stock production, Chinese distribution, and which two products it would focus on in future.

In other ASX health news:

Immutep’s (ASX:IMU) Chinese partner, EOC Pharma, has completed patient recruitment for a EOC202A1101 study being conducted in China. The study is taking place at the Fudan University Shanghai Cancer Center in China and is a single-center, open label, fixed dose-escalation phase one study in metastatic breast cancer patients. EOC Pharma is evaluating Immutep’s lead product candidate, efti, in combination with chemotherapy agent, paclitaxel.

Former bauxite explorer Cann Global (ASX:CGB) has raised money at 1c. The company massively diluted investors in 2019 with a capital raising at 3.5c for 170 million new shares as it sought to switch into cannabis and has raised money three times since it relisted.