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Health & Biotech
Healthcare and life sciences expert Scott Power, who has been a senior analyst with Morgans Financial for 27 years, gives his take on the ASX healthcare sector for the week, including HealthInvest 2025.
In the midst of tariff mayhem, finally some good news came out of the US to end the week with tissue regenerative medicine company Orthocell (ASX:OCC) receiving US Food and Drug Administration (FDA) approval for its flagship peripheral nerve repair product Remplir.
Orthocell went into a trading halt on Thursday before announcing on Friday morning much-anticipated 510(k) approval for Remplir.
Orthocell was one of five companies presenting at HealthInvest 2025 in Sydney on Wednesday, a collaboration between Stockhead, investor relations firm IR Department and Morgans to showcase emerging ASX healthcare companies to potential investors.
“It’s fantastic and a key milestone which has been achieved for Orthocell,” Morgans’ Scott Power said.
There were concerns that disruptions to key US healthcare agencies, including the FDA and Centers for Disease Control and Prevention (CDC), amid the Trump administration’s push for greater efficiency in government departments could impact healthcare companies. However, Power said Remplir’s approval was a positive sign.
“It also shows despite all the press around staff reductions at the FDA it is still operating and products are getting approved and through the system,” he said.
Power said Orthocell CEO and managing director Paul Anderson presented the company’s story well at HealthInvest.
“Clearly the surgeons are adopting their product ahead of some of the older legacy products,” he noted.
Remplir is one of two main products Orthocell has developed using its proprietary SMRT manufacturing process. Striate+ is a trademarked collagen membrane designed to support dental guided bone and tissue regeneration procedures.
Read more on Orthocell’s approval > Level achieved: Orthocell gains FDA approval for flagship nerve repair product
While looking resilient against President Trump’s “Liberation Day” tariffs and modestly up for the week at lunchtime on Friday, ASX healthstocks dropped in afternoon trade to finish down.
At 3.45pm (AEDT) on Friday, the S&P/ASX 200 Health Care index (ASX:XHJ) was down 2.1% for the past five days, while the benchmark S&P/ASX 200 (ASX:XJO) fell 3.8% for the same period.
Australia largely dodged the much higher “reciprocal tariffs” Trump slapped on many of the US’s trading partners. However, the local bourse still felt the fallout with widespread sell-offs in line with global markets.
“At this stage pharmaceuticals have been excluded from tariff discussions at the moment,” Power said.
“But at some point tariffs discussions may circle back to involve medicines and pharmaceuticals.”
Power said each of the five companies presenting at HealthInvest were news flow rich over the next six to 12 months with plenty to keep investors interested.
He told the crowd the broader healthcare market had struggled over the last three years, but was underpinned by positive structural tail winds of an ageing population, increasing medical innovation and consistent government funding.
“The key is to understand the catalyst that will be drive the business to the next inflection point, whether that is a clinical trial read out, regulatory approval, partnering/licensing deal, targeted level of sales or a material step closer to profitability,” he said.
Well known for its point-of-care (POC) testing products, Power said the company had turned around since CEO Dough Ward’s appointment in June 2022.
“Doug is very experienced and has a clear plan for both the products and services part of the business,” Power said.
Lumos has two sizeable deals with Hologic focused on development of a next-generation version of the Nasdaq-listed company’s on-market fetal fibronectin (fFN) diagnostic test for detecting pre-term birth.
The company recently expanded the scope of work for the fFN test, for which Hologic is the only manufacturer globally, estimated to generate additional fee revenue of between US$600k to US$800k.
“The deal with Hologic sounds very interesting and they are paying some serious money to Lumos to upgrade their fFN test,” Power noted.
Lumos is undertaking a CLIA waiver study in the US for its FebriDx test that aids in the differentiation between bacterial and non-bacterial acute respiratory infections.
CLIA waivers, granted by the FDA, allow certain diagnostic tests to be used in non-lab settings like doctor clinics and pharmacies by non-laboratory staff.
Lumos is conducting the study in partnership with the Biomedical Advanced Research and Development Authority (BARDA), part of the US Department of Health and Human Services’s Administration for Strategic Preparedness and Response.
BARDA is providing nearly US$3 million in non-dilutive funding, plus regulatory, technical and clinical support.
“They’re enrolling 800 patients for a trial to get the results they need to reclassify FebriDX from moderate complexity to a CLIA-waived device, which will make the market 15 times bigger than it already is with results due out in September this year,” Power said.
Microba Life Sciences (ASX:MAP) is at the forefront of microbiome diagnostics and therapeutics, setting a target of delivering one million of its tests.
The company has technology for measuring the gut microbiome and has inked a strategic partnership deal with pathology and radiology giant Sonic Healthcare (ASX:SHL), which acquired around ~20% in the company in 2022 for $17.8 million.
Under the deal, Sonic agreed to deliver Microba’s microbiome gastrointestinal pathogen test MetaPanel into its major markets including Australia, Germany, the UK, Switzerland, US, New Zealand and Belgium.
The company also has a gastrointestinal disorder test MetaXplore, which opened up to the full market in the UK on April 1 after referral rate growth under an early access scheme similar to Australia.
CEO Dr Luke Reid told HealthInvest that chronic diseases collectively represented more than 90% of healthcare spend in the US, with 21,000-plus research publications implicating gut microbiome in all the conditions.
Reid said the company’s immediate focus was patients with unresolved gastrointestinal disease, representing a $25bn market opportunity with its key markets Australia, the UK and US.
“They are building their testing numbers and have set themselves a target of one million tests,” Power said.
“The other side is clinical therapeutic development and they’re looking for non-dilutive funding pathways to move that forward.
“Microba is a very interesting story in this relatively new area of gut health which has got a huge amount of scientific and clinical data supporting its importance.”
Power described neuro-diagnostics medical devices company EMVision Medical Devices (ASX:EMV) as having “very innovative technology” to rapidly detect stroke.
“They’ve commenced their pivotal validation trial to support FDA de novo approval for their first commercial device – the emu bedside brain scanner to diagnose stroke,” Power said.
“They are looking to enrol over 300 patients in the next six to 12 months and assuming that completes on time you’re looking for approval in the second half of 2026.”
EMVision was founded in 2017 by CEO managing director Scott Kirkland, who presented at HealthInvest, and colleagues who acquired the technology from UniQuest, the University of Queensland’s commercialisation arm.
Speed is considered critical in stroke treatment with the first 60 minutes, referred to by medics as “the golden hour” determining outcomes.
Emu and its second smaller device First Responder scanners aim to provide high-contrast imaging in hospitals, ambulances, or emergencies, to detect new strokes and past damage rapidly.
“They’re a very interesting company with what is clearly a very large market,” Power said.
Power said Dimerix had plenty of upcoming catalysts with the company forecasting second interim analysis of its ACTION3 global phase III trial of lead drug DMX-200 to treat focal segmental glomerulosclerosis (FSGS) in mid-CY25.
The phase III study is titled Angiotensin II Type 1 Receptor (AT1R) & Chemokine Receptor 2 (CCR2) Targets for Inflammatory Nephrosis – or the far-catchier ACTION3 for short.
FSGS is a rare kidney condition that damages filtering units, leading to permanent damage and eventual organ failure, often requiring dialysis or a transplant. With no approved treatments worldwide, options are limited.
DMX-200 has been granted Orphan Drug designation in the US and Europe, as well as the equivalent Innovative Licensing and Access Pathway designation in the UK.
“CEO and managing director Dr Nina Webster explained the whole scarring of the kidneys in FSGS and how it is irreversible,” Power said.
“They’re expecting to release topline results around August, which is going to be a key catalyst.”
The company has inked three licensing deals covering Japan, several Middle Eastern countries and the European Economic Area, providing strong support for advancing and commercialising DMX-200 as a potential new treatment for FSGS.
“They estimate these deals to be worth 20% of the global market and are looking to ink further licensing deals,” Power added.
“The two big markets which they’re yet to sign are the US and China.
“So the two catalysts to look for with Dimerix are readout of trial results in August and licensing deals for the US and China.”
The views, information, or opinions expressed in the interview in this article are solely those of the interviewee and do not represent the views of Stockhead.
Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.
At Stockhead, we tell it like it is. While Orthocell, Lumos Diagnostics, EmVision and Dimerix are Stockhead advertisers, the companies did not sponsor this article.
Health & Biotech
Health & Biotech
Health & Biotech
