Morgans says economic challenges have been catalyst for innovation and resilience in ASX health sector
PharmAust submits supplementary data to US FDA from Phase 1 MEND study in support of its ODD request
Singular health gets $1 million backing from crypto high flyer Craig Sellars who will be appointed to advisory board
It’s been a strong start to 2024 for various biotechs on the ASX, which have attracted investor interest after achieving key catalysts or with more coming up in the near term.
Furthermore, Morgans health care analyst Iain Wilkie told Stockhead says recent economic challenges have been a catalyst for innovation and resilience, and the sector is starting to see the fruits of that labour.
“The tide is turning for the healthcare sector,” he says.
“Many companies are now leaner and more streamlined, with a sharper focus on most marketable/profitable assets.”
He says on the macro-side, the potential end (or at least stabilisation) of higher interest rate cycle could lead to more money flowing into healthcare.
“This will be particularly beneficial for small to mid-end companies that have been largely overlooked in the past two years.”
READ: ‘Tide is turning for the healthcare sector’ – ASX biotechs making strong gains in 2024 Part 1
‘Tide is turning for the healthcare sector’ – ASX biotechs making strong gains in 2024 Part 2
Here’s part three of our special on ASX health care stocks which have caught the eye of investors in the early months of 2024.
PharmAust (ASX:PAA)
PAA is up 227% YTD with positive announcements continuing to propel the company forward. The biotech last week announced it had submitted supplementary clinical data from its recently completed Phase 1 MEND study with the US Food and Drug Administration (FDA) Office of Orphan Products Development.
The data will support PAA in support of its recent request for Orphan Drug Designation (ODD) for monepantel (MPL) to treat motor neurone disease (MND) and amyotrophic lateral sclerosis (ALS).
The positive Phase 1 trial top-line results showed the 12 MND/ALS patients who received daily MPL doses over 7-12 months showed good tolerance without dose-limiting toxicities or severe side effects.
The average life expectancy following diagnosis is 27 months. The Phase 1 MEND study revealed a significant 58% decrease in the rate of progression of the disease.
Currently the only FDA-approved treatments are Riluzole and Relyvrio. Amylyx Pharmaceuticals announced in early March that its drug for ALS Relyvrio didn’t show significant benefit in its large Phase 3 clinical trial and may be withdrawn from market.
Findings from the pivotal trial called Phoenix trial showed Relyvrio didn’t outperform placebo in improving participants’ ALS functional scale, which is a metric assessing their capacity to breathe, swallow, and speak over 48 weeks.
Additionally, the drug failed to notably enhance patient-reported quality of life, overall survival, or respiratory function.
PAA CEO Dr Michael Thurn told Stockhead the recent confirmatory Phase 3 study failure of Relyvrio has highlighted the importance of biomarkers to support accelerated approval.
“Neurofilament light chain (NfL), a marker of neuronal degeneration, is an accepted biomarker that correlates with disease progression in MND/ALS,” he says.
“In PAA’s recently completed Phase 1 study, a large reduction in cerebrospinal fluid (CSF) NfL levels was observed for all patients where CSF samples were available. Monitoring CSF NfL levels will be a critical part of our planned pivotal registration study.”
Thurn says since joining PAA as CEO in September 2023, his mission has been to create greater awareness about the company and its program for MND/ALS with investors.
“The company is positioning itself as a global player in neurodegenerative disease,” he says.
“The recent positive Phase 1 study results has highlighted the potential for monepantel to be game changer in the way that we treat MND/ALS adding years to the lives of patients.
“The added bonus here is that we are now just one pivotal registration study away from being in a position to receive either accelerated or full approval from regulatory agencies.”
Singular Health Group (ASX:SHG)
SHG is up ~238%YTD and last week announced it had received the backing from a crypto high flyer, pocketing a $1 million investment from Craig Sellars, who will also be appointed to the medtech’s advisory board.
Sellars is co-founder of one of the world’s most commonly used cryptocurrency stable coins Tether (USD₮). He says he was introduced to SHG via his personal use since late 2022 of its 3Dicom software.
“From the moment I first used the 3Dicom software, I knew that I was looking at the leading edge of medical visualisation technology, miles beyond any other similar offering,” he says in the ASX announcement.
“The potential for doctors and patients to navigate the human body in this way using augmented reality will improve health globally.”
SHG’s 3Dicom MD Software-as-a-Medical-Device (SaMD) product received 510(k) clearance by the FDA in October 2022.
The company says its software is designed for use by medical practitioners to collaboratively visualise standard CT/MRI and PET scans in 2D & 3D in real-time with built-in voice and text chat, and remote control functionality.
SHG says Sellars brings a wealth of experience, valuable expertise and opportunities to SHG through his significant network, opportunities with blockchain technology, digital identity, consumer facing technology applications, and privacy-preserving record platforms.
Sellars investment is to be completed via a placement of 6,666,667 new fully paid ordinary shares in the company at 15 cents/share, a 36% premium to the last capital raise of 11 cents/share completed in February.
SHG is looking to accelerate its US commercialisation efforts, seeking to capitalise on recent sales traction in the world’s largest healthcare market.
Percheron Therapeutics (ASX:PER)
Formerly Antisense Therapeutics (ASX:ANP) PER is up ~62% YTD with the countdown on to the primary endpoint readout of its Phase 2b trial of lead program ATL1102, an antisense oligonucleotide treatment for Duchenne Muscular Dystrophy (DMD), due mid year.
PER is currently undertaking the international double-blind, placebo-controlled Phase 2b trial following positive clinical data from a prior single-arm Phase 2a study.
PER says there are ~300,000 DMD patients worldwide with existing therapies priced up to US$300,000 per treatment year with a total market ~US$4bn per annum and forecast to grow to ~US$10bn by 2030
The company says ATL1102 is potentially applicable to almost all DMD patients, not just those with specific genetic mutations (mutation agnostic). There is also potential applications for ATL1102 in other disease areas.
In the company’s latest quarterly report CEO Dr James Garner says alongside execution of the clinical trial, PAA has been carefully reviewing the regulatory dossier for ATL1102 to identify both opportunities and gaps that may be relevant to future regulatory discussions.
He says PER also continues to look for and have discussions with future potential partners for the ATL1102 program.
The clinical stage biotech’s pipeline comprises potential other first-in-class assets for genetic diseases with high unmet clinical needs.
PAA, SHG, PER share prices today:
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