Check Up: These 3 biotechs join the elite ASX 300 this week – and it could be a game-changer
Health & Biotech
Health & Biotech
Earlier this week, three biotech companies were officially admitted into the ASX 300 index for the very first time.
It follows the September quarterly rebalancing of the S&P/ASX300 index, which tracks the performance of the 300 largest companies (by market cap) listed on the ASX.
The S&P/ASX 300 is a significant index as it is one that many fund managers use as a cut-off for investments.
Entering the ASX 300 can be a major milestone for companies, signifying they have entered the big league.
Like any other market, the share market is a function of supply and demand.
If demand increases for a particular stock the price will go higher, and if a stock gets listed in a particular index, this can certainly increase demand.
Simply being on an index can boost a company’s share price as fund managers often replicate their portfolio based on a particular tracked index.
Here’s how the three companies stack up.
In the burgeoning area of medicinal cannabis and psychedelic therapy, Incannex stands out as it focuses on developing patented pharmacotherapies (drugs) for FDA registration.
Incannex’s competitive advantage over other medicinal cannabis companies is that its cannabinoid (CBD) drug candidates are being combined with existing off-patent pharmaceuticals.
The company is currently undertaking clinical projects for its CBD combination drug candidates to treat indications such as obstructive sleep apnoea, lung inflammation, and traumatic brain injury.
In partnership with the Clinical Psychedelic Research Lab at Monash University, Incannex is also undertaking a Phase 2 trial investigating psilocybin assisted psychotherapy to treat generalised anxiety disorder (GAD).
Incannex’s portfolio of clinical indications expanded rapidly since its landmark acquisition of APIRx Pharmaceuticals (APIRx) in August, supercharging its technical and drug development capability.
APIRx owns multiple patents for CBD-based drug candidates designed for treatment of addiction to different drug classes including opioid, cannabis and nicotine.
Meanwhile, in a strong vote of confidence, former Pfizer executive and now Novo Nordisk A/S vice president and US regulatory affairs expert Robert B. Clark has recently joined the Incannex board of directors.
Neuren has four Phase 2 trials of lead drug NNZ-2591 to treat serious neurological disorders that emerge in early childhood.
Specifcally, the drug focuses on Angelman Syndrome, Phelan-McDermid Syndrome, Pitt-Hopkins Syndrome, and Prader-Willi Syndrome indications.
These diseases are caused by different genetic mutations, but all essentially affect the patients’ ability to walk, talk, sleep, eat and even breathe.
Even though they’re all different, they’re very similar and Neuren believes that NNZ-2591 has the capability to treat all of them.
Neuren CEO, Jon Pilcher, believes these four indications could provide a much bigger opportunity than the Rett Syndrome drug, which has just completed its Phase 3 trial.
In December last year, Neuren stunned the market after announcing that it was close to launching the first ever drug for Rett syndrome.
The company said at the time that its North American partner, Acadia Pharma (Nasdaq: ACAD) reported positive top-line results from the Phase 3 Lavender study of trofinetide, Neuren’s asset.
Last week, the Rett Syndrome new drug application (NDA) was accepted for Priority Review by the FDA.
If this NDA is approved, Neuren expects to earn revenue over 2022 and 2023 for Rett syndrome in the US alone of $118 million, plus double-digit percentage royalties on net sales.
ACL is a leading Australian private provider of pathology services, and is one of the largest private hospital pathology businesses nationally, with over 90+ hospitals serviced.
The company also services 31 specialist skin cancer clinics, diagnosing around 15% of all reported melanoma cases in Australia.
Following its acquisition of Medlab in December, a NSW and Queensland focused pathology business, ACL now has operations in all mainland Australian states.
Unlike Incannex and Neuren, ACL is profit making and in FY22, its NPAT increased by 101% to $178.2m on the back of top line revenue of $995.6m.
The company acknowledged the past 12 months have been challenging for the business, but it was also a time for capability building.
Within the past year, ACL upgraded its Queensland laboratory and undertook a complex technological upgrade to its Oracle laboratory system to enable further efficiencies and service improvements.
Through this building process, ACL grew to over 1300 collection centres, and its market share also increased from 13% to 16%.
For this financial year, ACL has released a dividend guidance of 50-70% of FY23 NPAT.
LCT and OptiCellAI have completed the first stage of advancing the use of artificial intelligence (AI) in the planned manufacturing of NTCELL in Sydney.
The two companies are working to ensure that the NTCELL being manufactured in Sydney for the company’s third clinical trial of NTCELL in Parkinson’s disease is of the highest possible quality.
AI is being used to optimise and select high quality encapsulated cells (NTCELL) for implantation into the brains of people with Parkinson’s disease, as a potential treatment for the disease that affects millions of people globally.
Under the agreement with OptiCellAI, the first stage comprises the finalisation of the necessary hardware, software and testing specifications, together with creating the final design.
Invion told the market last week that its lead drug INV043 is effective against anal cancer.
A vitro study conducted at Peter Mac showed INV043’s effectiveness against six squamous cell carcinoma (SCC) cell lines that represent the full range of anal cancers.
The results are consistent with the promising outcomes achieved by the drug at the Hudson Institute of Medical Research on other cancer types, including triple negative breast cancer.
The global anal cancer market is forecast to grow at a compound annual growth rate (CAGR) of 6.3%, and is set to hit US$1.25 billion by 2028.
The X-ray tech specialist announced a strategic collaboration with Varex Imaging, the world’s largest independent manufacturer of X-ray technology components.
The collaboration deal includes an exclusive global licence for a non-refundable fee of $7.5m paid to Micro-X, enabling Varex to use Micro-X’s NEX technology in the field of multi-beam X-ray tubes.
It also includes Varex acquiring Micro-X shares totalling $7.5m to achieve a 9.9% stake in the company.
Micro-X says this is long-term strategic relationship which will provide a commercial opportunity for Micro-X to monetise an area of its core technology without impacting its existing or future plans.