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Health & Biotech
As the end-of-October quarterly reporting deadline nears, the stream of updates from the life sciences sector is becoming a torrent.
This morning’s batch has the qualities of the proverbial curate’s egg – good in some spots but not so good in others.
The expression, by the way, stems from an 1895 cartoon in which a young priest is having breakfast with his bishop and the bishop says: “I’m afraid you’ve got a bad egg there”.
The nervous curate replies: “no my Lord, parts of it are excellent.”
With similar tact, we note that for the commercialised plays, sustaining sales can be just as tricky as getting to market in the first place. Profits remain largely elusive, in the main.
On the rotten side of the egg, Next Science (ASX:NXS) shares plunged 33% after the wound-healing device house reported product sales of US$4.7 million, down 7% year on year with direct channel sales falling 14% to US$3.5 million.
Management says sales were affected by the company’s move from a direct sales model to durable medical equipment (DME) supplier status in the US.
In short, DME status enables faster sales and easier reimbursement.
The company notes a 44% uptick in sales of its newer Xperience product, a surgical irrigation wash to prevent surgical site infections.
Kiwi-based peer Aroa Biosurgery (ASX:ARX) served up more palatable fare: receipts of NZ$19.9 million, 35% higher than a year previously, with net cash outflows halving to $NZ1.2 million.
Aroa’s hero product is Myriad Matrix, an extracellular matrix graft for soft tissue reconstruction and complex wounds.
Device maker ImpediMed (ASX:IPD) reported unaudited revenue of $2.7 million, down 7% with operating cash outflows of $4.8 million.
Impedimed’s Sozo devices detect lymphedema – unwanted fluid in the limbs – that results from breast cancer.
The whizz-bang devices replace the old age but grossly unscientific method of monitoring lymphedema by tape-measuring the limbs.
The company attributes the sales decline to distributors working through current inventory and not purchasing more.
Globally, Impedimed has sold just over 1000 Sozos to date, from which the company derives revenue from the hardware and the ongoing consumables.
During the quarter the company sold 28 units in the US, which accounts for about half of the Sozos out there, compared with 23 in the June quarter.
Finally, reformed cannabis play turned ‘sustainable nutrition’ provider Elixinol Wellness (ASX:EXL) posted customer receipts of $4.1 million in the strongest quarter in four years.
Revenue grew 77% to $3.9 million, with $674,000 of cash outflows.
“Building on two years of uninterrupted growth, the company is strategically positioned to achieve key ebitda and sales milestones in the final stretch of 2024,” management promises.
Next Science shares this morning were at 13 cents, Aroa shares climbed 12% to 58 cents, Impedimed shares fell 3% to 6.2 cents and Elixinol shares were unchanged at 0.4 cents.
Predictive diagnosis leader Proteomics International Laboratories (ASX:PIQ) reported $253,000 of September quarter customer receipts but in essence the company is pre-revenue pending the launch of PromarkerD, its tool for predicting type 1 and type 2 diabetes.
The algorithm-based PromarkerD uses a simple blood test to detect a unique ‘fingerprint’ of the early onset of the disease, by measuring three serum protein biomarkers.
These are combined with three “clinical variables”: age, high-density lipoprotein (HDL) cholesterol levels and the kidneys’ filtering ability.
In its quarterly, the company says it hopes to launch PromarkerD in the US in the first half of calendar 2025 and in Australia in the March quarter.
Next year the company also hopes to launch Promarker Endo (endometriosis detection) and Promarker Eso (esophageal cancer). But given the extent of the malady, diabetes is the big prize.
Earlier this month Proteomics International terminated its exclusive US Promarker D licence agreement with Sonic Healthcare, alleging Sonic did not meet milestones and key performance indicators contained in the May 2023 agreement.
Proteomics is now free to launch PromarkerD in the US via licensing to “alternative pathology laboratories and service providers and/or direct to consumer or patient.”
Proteomics shares were unchanged at 78 cents.
The biotech sector’s capital raising spree continues apace, but the more cash strapped entities are copping steep discounts in order to seal the deal.
Shares in Chimeric Therapeutics (ASX:CHM) this morning tumbled 21% after emerging from trading halt, which makes sense given the cell therapies specialist unveiled a $5 million raising at 0.8 cents, a 42.9% discount to the last closing price on September 30.
The raising consists of a two-tranche placement to sophisticated and professional investors, with founder and chairman Paul Hopper putting his hand up for $1 million of scrip.
The second tranche – issue of shares to Hopper (and other directors) – is subject to shareholder approval.
There’s also the obligatory attached option on a one-for-one basis, expiring within 12 months of issue.
The funds will be used to support Chimeric’s proposed phase I-II trial of its drug candidate CDH17, acquired from the University of Pennsylvania.
The molecule is known as such because it targets CDH17, an antigen expressed on tumours and aims to treat gastric, pancreatic and colorectal cancers.
The company has launched a phase 1/2 trial, which is enrolling patients with neuroendocrine tumours, colorectal cancer and gastric cancer.
Two US sites are open, with a target of 15 patients by June next year.
Chimeric also has a novel Car-T therapy for brain cancer in phase 1b stage, as well as a ‘natural killer’ cell program for advanced colorectal and blood cancers.
Last week Percheron Therapeutics (ASX:PER) raised $13 million, also in a two-tranche placement at 8 cents a share, a 41% discount. The funds will support Percheron’s drug program for the rare childhood disorder Duchenne muscular dystrophy, which is in phase 2b stage and close to a read-out.
Chimeric shares were at 1.1 cents
Emerging from trading halt, PYC Therapeutics (ASX:PYC) shares this morning retreated 7.5% after the company updated investors on its dosing study of its lead drug candidate for the rare childhood blinding disorder retinitis pigmentosa type 11 (RP11).
We thought it was good news, but the market moves in mysterious ways.
The gist is that with a good safety and tolerability profile established in a single-dose study, the trend continued with patients receiving three treatments at the highest dose.
What’s more, the vision improvement seen in the single-dose study has been sustained.
VP-001 is the first drug candidate to have progressed into human trials for RP11. As we reported yesterday, it has been conferred ‘orphan’ drug status by the US Food & Drug Administration.
The company intends to provide a further update on its two multiple dosing studies in the first half of 2025.
PYC shares were trading at 18.5 cents.
At Stockhead we tell it like it is. While Aroa Biosurgery is a Stockhead advertiser, it did not sponsor this article.
Health & Biotech
Health & Biotech
Health & Biotech
