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Health & Biotech
It’s not a good look when company founders cash in some of their shares, but in the case of sector superstar Pro Medicus (ASX:PME) it hasn’t rattled shareholders one iota.
The US-focused supplier of radiology kits today said founders Dr Sam Hupert and Anthony Hall had each sold 1 million shares at $256.73 apiece in a roughly $512m sell-down, in response to entreaties from “high-quality institutional investors” seeking stock in the liquidity-constrained company.
The shares represent 4% of their holdings, but together they still account for 48% of the $26 billion market cap entity.
This time last year, the duo availed of a narrow post-results trading window to do exactly the same thing.
Since June, the shares have leaped 70% on the back of three big contract announcements, the most recent being late November’s $330 million, 10-year deal with Trinity Health (one of the biggest US not-for-profit healthcare networks).
Still, the guessing game with Pro Medicus is just how further the stock can go, given the company trades on an earnings multiple of well over 200 times.
Bell Potter opines the growth has been driven by a chronic shortage of radiologists in the US, which means the extant ones need the tools to be more productive.
“While the pressure release may come one day in the form of new tech (or) competitors and/or reimbursement approval for AI tech in diagnostic imaging, neither of these factors is near imminent.”
Pro Medicus itself is an ardent developer of AI-based tools.
The broker ascribes a ‘hold’ call on the stock, albeit with a 12-month target price of $260 compared with this morning’s price of $257.90 (up 0.5%).
In terms of enabling greater institutional access to the stock, the founder’s sale arguably is a good thing. It’s certainly not a case of rats deserting a sinking ship, as is the case with some more substantive sell downs we can think of.
The company’s $26 billion elevates it to the ranks of the biotech Big Three, ahead of Cochlear.
Small caps tend to fall foul of larger clients by skiting about contracts when they are not ready to be announced.
With Micro-X (ASX:MX1), the reverse happened: the US Tracking Accountability in Government Grants System website on Tuesday cited a US$8.2 million ($12.5 million) development contract, which the company thought had not been “fully executed”.
There must have been a few flurried phone calls overnight, because today the company confirmed the US Advanced Research Projects Agency grant was to develop a lightweight, portable full-body computed tomography scanner.
The device aims to improve rural folks’ access to healthcare.
The initial funding is for two years, but the news is even better as there’s a further potential US$8.2 million on offer over three years at the funder’s discretion, to get the device to US Food & Drug Administration registration stage.
Micro-x is a leader in cold-cathode x-ray technology, which enables imaging devices to be significantly reduced in size, with lower power requirements and more mobility.
The company is pursuing healthcare, military and veterinary applications.
The company’s Argus x-ray camera for security and defence is now commercially available, while the US Department of Homeland Security has contracted Micro-x to design a next-generation airport security checkpoint.
A portable early stroke diagnosis tool for use in ambulances is being developed with funding from the Australian government’s Medical Research Future Fund.
The full body scanner program is inspired by this stroke work.
The funding is handy non-dilutive capital for the company, which had cash on hand of $3.2 million at the end of June.
In the year to June 30 the company reported revenue of $15.2 million – including product revenue of $6.4 million – and lost $9.7 million.
Micro-x shares soared 50% on Tuesday after investors cottoned on to the news-that-officially-wasn’t and this morning surged another 32% to 9.4 cents on the news-that-officially-was.
Shares in stem cell developer Cynata Therapeutics (ASX:CYP) today entered a trading halt, ahead of the announcement of results of a phase I trial tackling diabetic foot ulcers.
While more than 1,200 stem cell therapy trials have taken place over the last decade, an enduring problem is obtaining enough of the precious cells from donors to service patients cost-effectively.
The quality of cells also varies from donor to donor.
Cynata is the world’s only clinical-stage company trialling induced pluripotent stem cells (IPSCs), from which the healing agent – mesenchymal stem cells – are derived.
IPSCs could produce a limitless number of high quality and high potency doses from a single donor.
Dubbed CYP-001, the diabetic foot ulcers study enrolled 30 patients to assess the stem-cell therapy with a wound dressing. The company earlier released data from the first eight patients, showing a median reduction in ulcer size of more than 88% in the active group, compared with 51% for the placebo cohort.
Naturally, the company hopes to see the pattern replicated in this week’s full results.
In the short term, Cynata also expects to report results from trials covering graft-versus-host disease (GVHD), knee osteoarthritis and kidney transplants.
Meanwhile, stem cell big daddy Mesoblast (ASX:MSB) expects US approval of its GVHD treatment for paediatric use on or by January 7, following years of setbacks.
Cynata shares were frozen at 21.5 cents.
Health & Biotech
Health & Biotech
Health & Biotech
