A Closer Look at the ASX Supervision Report

Good morning, Armchair Army,

Welcome to today's edition of The Armchair Analyst, a 5-minute daily update on the ASX life-sciences sector.

We’re into the final day of “tax loss selling”, and the market is already starting to rebound.

The healthcare the best-performing sector over the last week.

Neuren Pharmaceuticals up 36% yesterday on news that its CHMP is recommending their Daybue product for approval in Europe.

Pro Medicus is making more big swings in the Medtech space, including an investment in EchoIQ.

Clarity Pharmaceuticals is on the way up after trading under $2.00.

It looks like tax-loss selling is drying up.

I even got a call yesterday from an investor asking me about unloved medtech stocks.

Because, “with the heat coming out of the mining and metals trade (precious and critical), they are looking for the next sector to pop…

(their words, not mine)

Earlier this month, I wrote about healthcare stocks primed for the tax-loss trade.

An investment strategy I learned from an old retiree up in Queensland that has been running this playbook for years.

Buying stocks in June and selling them in October.

Quick reminder: here were the 5 stocks I used for this experiament

(Price at the time | Current Price)

I’ll have an update on my little experiment later this year in October:

One thing that caught my eye this week was a new publication from the ASX.

The first of its kind, “Supervision Report”, a high-level overview of what the ASX does and doesn’t care about when it comes to communication to the market.

I am a self-proclaimed student of stock promotion.

… and the best promotion of all comes from the announcements themselves.

So today, I’ll put the ASX Supervision Report under the microscope.

A little bit of a different article today, but it’s a topic that I’m passionate about.

But first…

Orthocell (ASX: OCC) expands its humanitarian program by shipping additional Remplir™ devices to Ukraine ahead of a planned EU/UK commercial launch in 2H 2026. (OCC)

🪑 There was a really nice piece in The Australian about how this relationship between Orthocell and Ukraine came about. (The Australian) 

Slauda Medical (ASX: SLD) secures FDA approval for its CAP24 Paddle Lead. (SLD)

🪑 Milestone ticked.

Talius Group (ASX: TAL) signed a 3-year master services agreement with Seventh-day Adventist Aged Care. Total contract value $1.15M. (TAL)

🪑 Nice contract.

What I liked about it was that this facility was only engaged 10-weeks ago. A good turnaround time between first engagement and sales.

Nexsen Limited (ASX: NXN) appoints the CEO of IHH Healthcare North Asia to its Advisory Board. (NXN)

Aroa Biosurgery (ASX: ARX) announces an on-market director's sale of 200,000 shares at $125,789.04. (ARX)

🪑 There was no accompanying announcement to dress this one up as “selling to pay a tax bill” or “selling to finance an options purchase”. 

Just a straight director sale on market. Savage.

Bioxyne (ASX: BXN) changes its name and ticker to BLS Pharmaceuticals (ASX: BLS) effective July 7th. (BLS)

🪑 Something to pay attention to if you’ve got the stock on your watchlist.

French biotech giant Ipsen agreed to acquire Kartos Therapeutics for up to US$1.75 billion for its promising mylofibrosis treatment. (Fierce Biotech)

🪑 Exit valuation comps just got an uplift for ASX-listed Syntara (SNT), which is gearing up for its own Phase 2b clinical trial for mylofibrosis in the back half of this year.

The FDA has published the names of eight panellists who will decide whether 12 key peptides are eligible for sale in the US under the compounding pharmacy rules. (STAT)

🪑 A big regulatory catalyst ahead for ASX-listed Tetratherix (ASX: TTX). 

TTX has developed a nasal spray technology for GLP-1s, hormones and peptides. Its US partner, Superpower Health, sells peptides through the Compounding Pharmacy route.

If the decision is made to unban these peptides next month, I imagine user demand will shift from black market vendors to more legitimate compounding pharmacies like Superpower.

I watched a great interview with 4D Medical (ASX: 4DX) on the ABC yesterday.

My favourite part was when the ABC host, Alan Kohler, couldn’t believe the 4D Medical reimbursed price point of US$650 per scan… (mentioned it a couple of times).

But the 4D Medical CEO is right… that price point is there to help build the company for the long term:

Adherium (ASX: ADR) secures a USD $1.65M unsecured loan from Trudell Medical Limited to meet immediate working capital needs. (ADR)

🪑 Looks like the company wasn’t able to get to cash flow breakeven off the back of its last capital raise (no surprises, it was an extremely tight needle to thread at $1M burn per month).

Does this $1.65M loan get them there? We’ll find out how they are tracking at the end of the quarter.

Co Secs, CEOs, brokers and directors pay attention to this next bit…

Last week the ASX published its inaugural Listed Entity Supervision Report:

This led me down a bit of a rabbit hole yesterday, during which I read all 101 pages of Guidance Note 8… 

The ASX rulebook for how companies make announcements.

(I do love a good rule book. When I was a soccer referee 15 years ago, I read the entire “rules of the game” cover to cover… I studied law too. Never wanted to be a lawyer, but loved the concept of the law.)

The basic principle is simple.

Once a company becomes aware of any information that a reasonable person would expect to have a material effect on its share price, it must immediately notify the ASX.

This is the continuous disclosure rule that underpins all ASX announcements.

Now, I’m also a student of stock promotion.

How does an ASX-listed company…

… Best communicate its story?

… Leverage the tools at its disposal to keep shareholders informed?

… Manage market expectations so that there is true price discovery when the company achieves something material?

The number one tool at any company’s disposal is the ASX announcement.

But as companies seek an edge in the market to attract investor attention, these rules are tested, and the ASX is always watching.

The ASX is essentially the market’s referee.

So, here are my quick-fire thoughts on the inaugural Listed Entity Supervision Report.

I like this initiative from the ASX.

Many companies I’ve spoken to along the way have been frustrated by the ASX’s lack of nuance in how it allows them to disclose material information.

But understanding where the regulator's focus is can help companies craft messages that are compliant AND maximise their ability to communicate their story to shareholders.

Ramping is the practice of making announcements designed specifically to manage the company’s share price.

(Generally in anticipation of a capital raise).

… and they are not allowed.

I’ve always found the concept of ramping announcements a challenge.

There is a conflict between continuous disclosure (announcing news as it happens) and ramping (not announcing news because there is a perception that you’re managing the share price).

Unsurprisingly, this has led to many a conflict between companies and the ASX, in which the merits of specific wording or the materiality of news are vehemently debated.

 Unproductive productive engagement, the ASX calls it in the report.

The ASX now will adopt a ‘whole of behaviour’ approach rather than looking at individual announcements to evaluate ramping.

I like this.

My advice for companies would be to make it a practice to frequently release announcements and news (not just around capital-raising time, where the ASX is paying attention). 

More is better, and it won’t be ‘out of the ordinary’ if you’re releasing frequent updates to the market.

The ASX specifically highlighted Biotech companies as an area of interest, particularly the handling of clinical trial data held by third parties (principal investigators) or by those involved in the peer-review process.

The ASX doesn’t want confidential market-moving information in the public domain, so it's paying close attention to how this is kept under lock and key.

Other areas of interest in biotech include presenting results at scientific conferences.

(I’ve seen a few “poster presentations” have moved the market).

This is a biotech-specific issue, and I’m glad the ASX has recognised the industry's nuances.

The ASX specifically highlighted Stock Promotion Services as one of the areas of interest for 2027.

Specifically, around disclosures and handling of market-sensitive information.

It is likely that I fit into this category as someone who helps a select group of high-potential companies gain market attention.

(I’m very selective about my clients. I only write about stocks that I personally invest in and am willing to endorse - TTX, EMD and CBL.)

I welcome frameworks and clarity that help me to write about the stocks in a way that is compliant and transparent.

Over the next week or so, I’ll be looking to bolster my policies in relation to the stocks that I write about.

This is important to me, as I believe it builds trust.

Stay tuned.

If you’ve made it this far, well done! 

A bit of a different article today, but a topic I’m passionate about nonetheless.

See you all tomorrow,

The Armchair Analyst