Health Check: Chinese consumer market is a thing of beauty, says EZZ Life Sciences

Chinese shoppers have not lost their appetite for EZZ’s health and beauty products
Ho-Ho-Ho (Chi Minh)! Viet deal is an early Xmas prez for Truscreen holders
Patrys says it will focus on its Plan B drug candidate

China is a tough consumer market – we all know that – but Middle Kingdom shoppers haven’t lost their appetite for EZZ Life Science (ASX:EZZ) hair and skin beauty products.

At EZZ Life Sciences’ AGM today, management reported that the 11.11 Global Shopping Festival had generated $5.91 million in sales across the Chinese online retail marketplaces Tmall, Douyin and Kuaishou.

This haul was 84% better than last year’s $3.21 million.

For the uninitiated – your columnist included – the festival was hosted by online portal Alibaba, on – duh – November 11.

It coincides with Singles Day, when unattached individuals spoil themselves with gifts.

But EZZ should not be dismissed as just as another beauty play – many of which have foundered in the Asian market.

The company bases its products on genomics science and is carrying out research programs in human papillomavirus, the tummy infection helicobacter pylori and weight management.

Bolstered by 21 new healthcare products, EZZ reported $66.4 million of revenue in the year to June 2024, up 79%. Underlying earnings (ebitda) more than doubled to $10.4 million.

The company backed up a 1.5 cents per share interim dividend with a final div of 2 cents.

As at the end of June, EZZ had cash of $19 million and no debt.

“This financial strength … places EZZ in a formidable position to pursue growth opportunities and strategic initiatives,” chairman Glenn Cross told holders.

While EZZ has been Asia-focused, the company recently won US Food and Drug Administration (FDA) for several products.

EZZ shares have gained more than 330% over the last year and in early October were close to 700% to the good. The stock this morning was 1.1% firmer at $2.64.

Truscreen signs up for Vietnamese cervical cancer screening program

Still on our northern neighbours, Truscreen Group’s (ASX:TRU) focus on using its algorithm-based cervical cancer screening tool in low- and middle-income countries is reflected in a deal with Ho Chi Minh City’s health authorities.

Unveiled today, the agreement, with Ho Chi Minh City Public Health Association and distributor Gorton Health Services, will see 260,000 women in the populous Vietnamese capital screened for cervical cancer over five years.

An alternative to Pap smears, Truscreen’s non-invasive tests are done in real time and do not need pathology labs.

The program will screen patients in existing community health clinics and may extend to mobile screening.

“The signing of this memorandum of understanding further reinforces our non-invasive and real-time screening as a technology particularly suited for use in low- and middle-income countries,” CEO Martin Dillon says.

“We are increasingly recognised by key government agencies [for] the ability for Truscreen to be rolled out quickly and economically in large population-based screening programs.”

In China – where Truscreen already is selling its single-use sensors – the company is targeting 476 million women of screening age.

Truscreen is also tackling other tricky geographies, including Indonesia, Uzbekistan, Palestine, Jordan, Palestine and Rwanda.

Truscreen is included in World Health Organisation (WHO) cervical cancer screening guidelines.

The company’s shares were up 10.5%, to 2.1 cents.

Patrys explains ‘difficult but necessary’ decision to halt lead program

While many biotechs pride themselves on being ‘laser focused’ on a singular program, Patrys (ASX:PAB) shows the virtues of having a spare one in the back pocket.

To explain, in early October Patrys said it would not continue its flagship program, PAT DX-1, because its manufacturing of the molecule was not of a high enough standard for use in its proposed human trial.

PAT-DX1 is a humanised and smaller version of deoxymab, a DNA damage repair antibody first identified in the inflammatory immune disorder lupus.

The ‘tumor agnostic’ DX-1 was thought to be useful for gliomas and melanomas and breast, prostate, pancreatic and ovarian cancers.

On Friday, shareholders were told the company’s attention would turn to the same-but-different PAT DX-3, which is easier to make.

It is hoped PAT DX-3 will work against inflammation-inducing neutrophil extracellular traps, or NETs (neutrophils are the most common white blood cells).

The company cites potential applications for multiple cancers, vasculitis and other NET-associated disease.

Given its ability to transcend the blood-brain-barrier, PAT DX-3 could also be used as an agent to administer other drugs and imaging agents.

As well as being easier to make, PAT DX-3 is higher yielding and more stable. But given Patrys shares tumbled by 50% after the company announced the manufacturing setback on October 2, investors evidently still prefer PAT DX-1.

But at least management still has something to talk about.

“The decision to re-prioritise to PAT-DX3 was not made lightly, and we understand this is a particularly difficult time for our shareholders,” chairman Charmaine Gittleson told holders.

“However, we believe these changes are necessary to ensure the long-term sustainability and success of our company.”

Patrys shares were unchanged at half a cent.

Strike and spill watch

With the AGM season winding up, biotechs are living dangerously when it comes to ‘strikes’ on their remuneration reports, with some high-protest votes against director elections as well.

At Patrys’ get together, 30% of holders voted against the ‘rem’ report, so given the 25% threshold that was duly recorded as a first strike.

Alterity Alterity Therapeutics (ASX:ATH) and Bioxyne (ASX:BXN) on Friday missed ‘strikes’ by the hair-of-their-chinny-chin-chins, with no votes of 24.4% and 22% respectively.

Last week Island Pharmaceuticals (ASX:ILA) incurred a second strike and faces a motion to spill the board. Atomo Diagnostics (ASX:AT1) also copped a second strike, but holders voted against the board spill.

Today Island shares entered trading halt at 16.5 cents, pending safety review committee recommendations regarding its planned phase 2a dengue fever trial.

Dubbed Protect, the prophylactic arm involves treating healthy candidates with Island’s drug candidate and then exposing the volunteer to the attenuated (weakened) virus.

At Stockhead, we tell it is as it is. While EZZ and Island are Stockhead advertisers, they did not sponsor this article