Check Up: Biotechs are going through a rough patch, but recent ASX IPOs haven’t flopped too badly
Health & Biotech
Health & Biotech
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We are currently in the longest and steepest bear market for biotech ever.
The NASDAQ Biotechnology Index (NBI) has lost over 21% since peak levels Feb 2021, while the S&P/ASX 200 Health Care [XHJ] index is down 17% since its peak in Feb 2020.
In the US, biotech companies that made their IPO debut in 2021 have seen their stock prices shredded. The IPO class of 2021 for Nasdaq biotechs is down on average by 60%.
But back on domestic shores, the IPO picture doesn’t look as bad.
Here’s a snapshot of ASX healthcare stocks that have listed over the last year or so.
According to analysts, the more worrying part is the fact that market appetite for biotech stocks has now diminished significantly.
That means it would be harder for early stage biotechs to go public, or even raise funds to fund operating costs.
As a result, many pre-revenue biotechs will have to rely on their limited cash, and in some cases, having to lay off employees just to survive.
In its favour is the fact that Treasurer Josh Frydenberg has just increased Budget funding for the sector.
Being Australia’s biggest employer, the healthcare sector employs 1 in 7 Aussies or roughly two million people.
The 2022-23 health budget sees the sector topping $132bn, up from $62bn a decade ago.
Medical device company OncoSil surged 40% on Wednesday following the first ever pancreas treatment conducted using its device in Europe.
The procedure was performed at The Hospital Universitario de Fuenlabrada, located in Madrid, Spain.
The OncoSil device is a single-use brachytherapy used to deliver a dose of beta radiation directly into cancerous tissue.
The beta radiation emitted by the device travels a short distance within the tumour tissue, causing direct damage to the cancer cell DNA.
The device already has a CE Mark in Europe and the UK, and received a Breakthrough Device designation in the US.
Cann has surged 20% over the past week after it was granted the necessary permit by the Office of Drug Control (ODC), to allow the manufacture of medicinal cannabis products at its Mildura facility.
Cann says it’s continuing to work with the Therapeutic Goods Administration (TGA) on the GMP licence application for the Mildura site, and expects to have that licence in place in coming months.
Cann is authorised to sell extracts produced in Mildura as an Active Pharmaceutical Ingredient (API).
Recce has been granted a patent in Hong Kong for its RECCE Anti-Infectives drug.
The patent covers the composition and method of manufacturing the RECCE anti-infectives, including the use of drugs R327 or R529 to treat viruses such as SARS-CoV-2.
Recce says the pharmaceutical market in Hong Kong is valued at US$2.3 billion, with ever rising demand for chronic disease treatment.
Smartphone-based health company ResApp Health surprised the market on Monday after revealing that global giant Pfizer wants to buy out the company.
Pfizer offered RAP’s shareholders 11.5 cents a share, valuing ResApp at around $100m.
The ResApp Board has unanimously recommended that shareholders vote in favour of the offer.
RhinoeMed surged over 20% on Tuesday after coming out of a trading halt.
On April 8, RhinoMed announced that it was tapping the market for another $5m in cap raise.
The funds will be used to expand the sale of its Rhinoswab and Rhinoswab Junior in international markets.
NSB rallied 10% on Wednesday after a successful human study of lead drug, EmtinB.
In the Preclinical Safety and Toxicology Program, EmtinB was shown to be safe with no major adverse effects or toxicology findings reported.
These results have now given NSB confidence to commence a first-in-human clinical trial, pending an ethical approval expected in May.