Biotechs outperform Small Ords in Aussie health ‘coming of age’
Biotech stocks have had a mixed start to the year — with about half of the 40 stocks tracked by Stockhead enjoying gains.
Scroll down for a table showing how 40 ASX-listed biostocks have performed this year.
But the sector has outperformed the Small Ordinaries index so far this year with a solid stream of newsflow from international mergers and landmark discoveries.
Last week ovarian cancer tester Bard1 Life Sciences (ASX:BD1) as much as trebled it share price on news of additional positive results for its non-invasive test.
Shares in the company opened at 0.1c on Monday, reached highs of 3.1c and settled to 2.6c at Friday close.
Similarly, Immuron (ASX:IMC) started the week at 27c and reached intra-day highs of 60c, to close at 39c.
The company claimed a “world first” when its oral treatment reduced inflammation for patients with fatty liver disease.
“I see all the recent activity as the real coming of age of good Australian biotechs and they are leading the way for more innovative Australian companies to follow,” biotech daily editor David Langsam told Stockhead.
“Global big pharma and med tech players know that Australia can do some of the world’s best science and our research per capita is some of the best in the world.”
Early on, Mr Langsam analysed companies such as Ademus (ASX:AHZ) with high hopes and a product for patching humans with cow hearts — now, its ADAPT technology has received regulator approval for human use in North America.
February’s $500 million Viralytics (ASX:VLA) deal has been one of the sector’s key successes this year.
“Making developments for cancer treatment is particularly difficult, which is why Viralytics is such a big shining light for the industry,” Mr Langsam said.
“Not only is it a drug, but it specifically targeting cancer — big pharma is no longer impressed by just curing cancer in mice, so convincing Merck is a bid deal.”
In a research note released earlier this year, advisory firm Wilson’s named its top contenders for the next merger or acquisition – Telix (ASX:TLX) , Opthea (ASX:OPT), Anatara Lifesciences (ASX:ANR) and Oncosil Medical (ASX:OSL).
Further pushing the trend of Australians to develop the technology behind treatment rather than drugs themselves.
“It is much easier to develop a device or a diagnostic rather than a drug for the simple fact that adding a monitor externally is far less risky that putting a drug inside of someone,” Mr Langsam said.
“Historically, the wins in Australia have been those of devices and diagnostics, our long-term failure has been drug development.”
Here’s a table showing how 40 ASX-listed biostocks have performed this year.