Clarity Pharma rated Overweight by Wilsons on near term catalysts
Pointsbet has exited US and will now focus on the Aussie market
Jarden says Pointsbet should capture market share in Australia on tech advantage
Clarity Pharma’s clinical trial results loom as next catalysts
Wilsons Advisory has slapped an Overweight rating on Clarity Pharma (ASX:CU6), with a 12-month price target of $3.12 (versus current price of $2.70).
Clarity is a $800m+ market capped radiopharmaceutical biotech which has developed a unique proprietary program involving the use of copper isotopes in prostate cancer diagnosis and therapy.
The company has stamped itself as a global leader in Targeted Copper Theranostics (TCTs), a disruptive platform in radiopharmaceutical that employs the “perfect pairing” of Copper-64 and Copper-67 for diagnosis and therapy (or theranostics), respectively.
To read more about the company, read: Radiopharmaceutical emerges as the hottest space in biotech; here’s what it means for Clarity Pharma
Clarity recently completed a $110m institutional equity placement and an $11m entitlement offer that should see it funded through to CY26.
The company has plenty of data yet to share this year with its SABRE trial under way.
SABRE is a Phase II Positron Emission Tomography (PET) imaging trial of 50 participants with PSMA-negative biochemical recurrence (BCR) of prostate cancer following definitive therapy. It is a multi-centre, single arm, non-randomised, open-label trial of 64Cu-labelled SAR- Bombesin.
Other catalysts for Clarity include the theranostic SECuRE trial – which is investigating SAR-bisPSMA in metastatic castrate-resistant prostate cancer (mCRPC) patients.
The SECuRE trial has so far shown remarkable results. Among the participants from cohorts 2 and 3, almost 80% showed reductions in PSA (prostate-specific antigen) levels of greater than 35% from a single dose of 67Cu-SAR-bisPSMA, and 44% showed reductions in PSA levels of greater than 80%.
Meanwhile, interest from big pharma in the radiopharma space continues. Over the last six months, three global blockbuster deals have taken place in this space – AstraZeneca acquiring Fusion for US$2.4b, Eli Lilly buying out Point Biopharma for US$1.4b, and Bristol Myers Squibb’s purchase of Rayze Bio for US$4.1b.
“We clearly note the consistent inclusion of manufacturing capabilities as part of these acquisitions.
“Clarity have that part of the equation now further solidified with their extended agreement with NorthStar for end product cGMP manufacture of their 67Cu- SAR-bisPSMA therapeutic agent – continuing to make Clarity Pharma a standout target,” said the note from Wilsons.
Pointsbet exits US, targets market share in Australia
Meanwhile, Jarden Research has also slapped an Overweight rating on Pointsbet (ASX:PBH), with a target price of $1.05 (versus the current price of $0.81).
Pointsbet is a $260m+ market capped wagering company that offers betting in the four major US sports (NFL, NBA, MLB, NHL), as well as horse racing, greyhounds, and AFL matches in Australia.
PBH recently announced it has reached the final sale completion of its US operations to Fanatics, with all US regulatory approvals received. As a result, PBH has received the final US$50m instalment (total US$225m) proceeds, which will be paid to shareholders in the form of special dividends.
“Financially, eliminating a loss-making US operation materially reduces financial risk and should move the business to a net cash (c.$30m) position,” said Jarden.
The sale of the US business leaves the company with its Australian and Canadian businesses, which will be rolled into PointsBet’s RemainCo.
The company has said that it will be targeting more market share in Australia, and Jarden says its sees a real opportunity for PBH and other domestic players (e.g. Tabcorp, BlueBet) to do just that.
“This is despite a domestic wagering turnover market that remains soft, evidenced by Sportsbet’s Australian guidance of a 30% FY24 EBITDA decline.
“Lower competitor returns should reduce their ability to reinvest and shift the competitive landscape more towards technology and wagering innovation. This should suit PointsBet.”
“We see PBH as strategically very well positioned given its proven technology, established brand, overweight sports betting, and younger customer age demographic,” said Jarden.
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