• The ASX Health Care index saw a 4% increase in June
  • Growth was driven by CSL and Cochlear
  • Best biotechs in June were Actinogen, Optiscan and EZZ Life Science, amongst others 

 

The S&P/ASX 200 Health Care index [XHJ] saw a 4% increase in June, contributing to an overall 4% gain for the year.

This growth for the year was mainly driven by a 3% rise in vaccine provider CSL (ASX:CSL), the largest stock in the index, and a 10% increase in Cochlear (ASX:COH) an implantable hearing solutions company.

Cochlear had a big first half, reporting a robust 21% increase in interim NPAT (versus pcp) to $192 million. The growth was fuelled by a 20% rise in revenue, driven by high demand for cochlear implants and sound processor upgrades in the market.

Cochlear also reaffirmed its full year FY24 guidance for underlying NPAT in the range of $385 million to $400 million, which represents a growth of 26% to 31% compared with FY23.

Meanwhile, the main drag on the XHJ index has been the substantial decline in the second-largest stock within the index, Sonic Healthcare (ASX:SHL).

Sonic’s shares have dropped by -20% in 2024 following the the company’s decision to revise its previous earnings forecast downward.

In May, Sonic downgraded its forecast for EBITDA for FY 2024 to approximately $1.6 billion, based on revenues of about $8.9 billion. This contrasts sharply with the EBITDA guidance it gave in February of $1.7-1.8 billion.

Sonic provides medical diagnostics and laboratory services globally. The offering includes a wide range of laboratory and pathology testing services, as well as radiology and clinical services.

 

ASX Biotech winners and losers for June 2024

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Actinogen Medical (ASX:ACW) +138%

Actinogen surged in late June after announcing positive results from its Phase 2a biomarker trial for its lead drug, Xanamem, in patients with mild Alzheimer’s disease.

The trial, published in the Journal of Alzheimer’s Disease, showed that patients with elevated blood pTau181 had faster disease progression compared to those with lower levels.

Among these patients, those treated with Xanamem showed promising effects in slowing clinical decline, particularly in measures of cognitive function.

These findings suggest potential efficacy of Xanamem in Alzheimer’s treatment.

“To our knowledge Xanamem is the first drug of this class to have such compelling data,” said Dr Dana Hilt, the company’s chief medical officer.

The previously published PET (positron emission tomography) study highlighted just how effective Xanamem is at reaching its target enzyme in the brain at safe and well tolerated doses of 5 and 10 mg/day.

“No other inhibitor of 11β-HSD1 has ever demonstrated robust central nervous system (CNS) target engagement in this direct way,” he added.

 

Optiscan Imaging (ASX:OIL) +124%

Optiscan soared in early June after introducing a groundbreaking medical imaging device called InVue, aimed at revolutionising surgery by providing surgeons with immediate access to digital pathology during operations.

This technology allows surgeons to make instant decisions and adjustments, improving precision in surgeries.

Traditionally, pathology testing has been done in separate labs and involves time-consuming processes with delayed results. InVue changes this by offering real-time pathology insights directly in the operating room.

Developed in Melbourne in collaboration with Design + Industry, the device is designed for ease of use in clinical settings, particularly in cancer diagnosis and treatment.

InVue enables surgeons to view microscopic images and pathology details instantly, enhancing diagnostic accuracy and potentially reducing the need for multiple procedures and repeat surgeries.

Read more here: ‘Significant milestone’: Optiscan soars on new InVue imaging device for precision surgery

 

Cleo Diagnostics (ASX:COV) +100%

In late June, Cleo announced significant progress in advancing its regulatory strategy for its pre-surgical triage test designed to detect ovarian cancer.

Recently, Cleo conducted an initial pre-submission meeting with the US FDA.

During this meeting, Cleo presented its comprehensive submission framework and outlined its clinical plan for the ovarian cancer detection blood test.

The interaction with the FDA was highly constructive, Cleo said, with the regulator providing positive feedback on Cleo’s approach.

This feedback not only validates Cleo’s strategy but also enhances confidence in its clinical trial designs aligning with FDA expectations.

Cleo believes such early engagements are pivotal in shaping its pathway towards gaining regulatory approval in the US, particularly through the 510(k) application pathway aimed at achieving “substantial equivalence” to existing predicate devices.

Cleo has also successfully obtained Institutional Review Board (IRB) approvals in both the US and Australia, which are essential for ensuring compliance of clinical trials.

With these approvals in place, Cleo is now moving forward with formalising trial site contracts and preparing for patient recruitment.

 

EZZ Life Science (ASX:EZZ) +86%

Also in late June, EZZ announced a major milestone with an FDA approval for nine of its health supplement products in the US market.

This approval is significant as online sales of health supplements in the US totalled $23.8 billion in 2023.

The approved products, including children’s health essentials and supplements for brain focus and joint energy, will be launched initially in the US through EZZ’s new subsidiary, EZZ Life Science Holdings (USA) Inc.

Chairman Glenn Cross describes the FDA approval as a monumental achievement for EZZ, as the company plans to capitalise on this milestone to drive growth in the US market and bring high-quality products to American consumers.

EZZ’s strong growth trajectory includes recent agreements in Hong Kong and significant financial performance in Q3 FY24, with customer receipts up 111% year-on-year and a debt-free status with increased cash reserves.

Now read: EZZ US bound after FDA approval for nine products

 

At Stockhead we tell it like it is. While Optiscan Imaging and EZZ Life Science are Stockhead advertisers, they did not sponsor this article.

 

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