Twiggy's Tattarang is getting into health tech - which ASX stocks will benefit?

Twiggy’s Tattarang has seeded a new fund called Tenmile with $250m
Tenmile will focus mainly on Aussie biotechs
Here are the ASX stocks that will benefit

Andrew “Twiggy” Forrest’s business philosophy has always been: “You bite off more than you can chew, then you chew like buggery.”

And when he does take a bite, the investment community tends to sit up and take notes.

The $30bn man has been living up to his reputation lately, buying up more shares in Bega Cheese and taking a 15% stake in shipbuilder Austal.

This week, Twiggy’s Tattarang Ventures has also launched a brand new $250 million fund called Tenmile, which will solely focus on the health tech industry.

Tenmile will be an early seed venture capital (VC) fund that will support early stage biotechs through the so-called ‘valley of death’ – the period when cash is burnt on R&D and no revenue is being made.

The fund’s particular focus will be on biotechs working on solutions to address unmet medical needs that support a “sustainable and equitable healthcare”.

“Our laser-focused approach means we can help early-stage companies, researchers and entrepreneurs tap into seed funding,” Forrest said.

“This will help them when they need it most, and then provide follow-on support, which is often unavailable through government or public sector funds.”

Emyria welcomes Tattarang’s stake

One of the early companies the fund is backing is ASX-listed Emyria (ASX:EMD).

Tenmile has acquired a 7.3% stake in Emyria for $5 million.

Emyria is an early stage biotech focused on the development of medicinal cannabinoids and psychedelics.

The company has uniquely created and screened over 125 MDMA-inspired analogues, led by Professor Matt Piggott and in partnership with the University of Western Australia.

Better known as ecstasy, these MDMA analogues could potentially be used as next generation psychedelic-assisted therapies for neurological disorders like Parkinson’s disease.

Early studies showed that 16 of the novel compounds demonstrated no interactions with selected “anti-targets” or receptors known to be involved in unwanted side effects.

To further progress this result, Emyria has recenty engaged the services of The Institute of Respiratory Health (IRH) who will conduct follow up studies.

The first preclinical program conducted by IRH will explore the antifibrotic potential, evaluating the compounds’ ability to inhibit “fibroblast to myofibroblast” differentiation and collagen deposition in normal human lung fibroblast cell lines.

Emyria hopes the study may reveal potential to treat diseases involving fibrosis, the thickening or scarring of tissue. Results will be announced in around two months time.

The EMD share price has risen by 20% this week since the Tattarang stake was announced.

Emyria share price today:

Carina Biotech and AdAlta

The other early investment made by the fund is an Australian company called Carina Biotech.

Carina is developing chimeric antigen receptor T cell (CAR-T) therapies to treat solid cancers. Its lead candidate, the LGR5-targeted CAR-T cells, have demonstrated the ability to kill a wide range of cancer cells in vitro and in animal models.

Carina also has a collaboration agreement with ASX-listed AdAlta (ASX:1AD) to develop next-generation i-body enabled CAR-T cells.

Both companies have the same goal, which is to bring CAR-T cell therapy to treat a far greater range of cancers than the small number of blood cancers that has been achieved so far today.

AdAlta mainly focuses on its lead drug candidate, i-body AD-214, to treat fibrosis.

AdAlta CEO, Dr Tim Oldham, told Stockhead previously that AdAlta’s i-bodies are the “next generation antibodies” that are genetically modified, and are approximately one-tenth the size of monoclonal antibodies.

According to Oldham, there are a few obstacles that need to be overcome before CAR-T therapies could really go mainstream.

Firstly, the therapy is currently only effective on blood cancers, and not on solid tumours.

“The second problem is getting the T-cells into the solid tumour. With a blood cancer it’s easy because they’re all in the blood anyway.”

Oldham believes AdAlta’s collaboration with Carina could potentially address these problems.

Gina’s Little Green Pharma

Although Tenmile will be focused on opportunities in Australia, the fund will also invest and partner in international markets both for the returns and to support Australian investees who want to access overseas markets and capital.

Tenmile’s executive chair Dr Steve Burnell, said there are many large opportunities within the health tech sector.

“Health technology for us encompasses areas as diverse as medical devices, diagnostics, biotech, pharmaceuticals, and even healthcare services,” Burnell said.

“We are particularly excited about emerging opportunities in immunology, oncology, digital health, the microbiome and microbial resistance.”

Tattarang’s move into medicinal cannabis isn’t the first for an Australian iron ore magnate.

In June last year, Gina Rinehart’s Hancock Prospecting fund invested $15 million for a 10% stake in cannabis stock Little Green Pharma (ASX:LGP).

The injected funds have brought forward LGP’s expansion plans into Europe by two years, and will see its annual cultivation capacity go up immediately from 3 tonnes to 23 tonnes.