Good morning, Armchair Army,
Welcome to today's edition of The Armchair Analyst, a 5-minute daily update on the ASX life-sciences sector.
There’s green on the screen.
(Well, at least there was yesterday!)
Over the last week, Healthcare has outperformed every other sector on the ASX (and it’s not even close).
Seedlings of investor interest are emerging.
The sector will have its moment, but as I’ve mentioned a couple of times, it will take a few major deals at the top to bring mainstream investor interest…
Yesterday, one of those major deals landed.
Novartis announced it would acquire a preclinical cancer biotech company, Myricx Bio.
US$1.1 billion upfront in cash and US$1.5 billion in milestones.
The seed investor in the company?
Australia’s largest biotech VC firm, Brandon Capital.
A healthy $300 million return.
(Source: Biopharma Dive)
Big wins like this provide attention for the sector.
Here is the front page of the Financial Review highlighting that Brandon Capital will return more than A$300 million in cash to its Australian superannuation fund investors…
Hostplus, HESTA and Aware Super.
While Myricx is a private, London-based company, this is still a huge windfall for Australia’s biotech investing industry.
It shows Australian investors (particularly Australian institutional investors) that moonshot biotech bets can generate significant returns.
I like to describe investor interest in a sector like a waterfall.
Investors need multiple “wins” before attention and capital flow further down to earlier, riskier investments.
In biotech, a win generally = M&A deals.
For the past several years, the top of that waterfall in the Australian biotech sector has been barren.
But more deals like this one and the top of the waterfall will continue to flow…
Until eventually it spills over into early and riskier bets.
That’s when you know we’re in a bull market.
Yes, this is just one deal, from a private company.
But things are heading in the right direction.
More deals at the top of the waterfall and the capital will start to flow.
And when it overflows… it will flow quickly.
Let’s dive in…
The Pulse Check
Island Pharmaceuticals (ASX: ILA) secures approvals to use Galidesivir in Africa during the Ebola epidemic, enabling compassionate treatment and the collection of human efficacy data, with support from WHO and the Ugandan Ministry of Health. (ILA, not held)
🪑 Genuinely big news. Nice work
Optiscan Imaging Ltd (ASX: OIL) launches its InSpecta™ veterinary imaging device in the U.S., following FDA clearance. (OIL, not held)
🪑 While I didn’t discuss the veterinary imaging device much in my article on Optiscan last week, this is a big milestone.
Nice work by the team; they can now start generating early commercial revenue in anticipation of the 510(k) for human use of the product.
Entropy Neurodynamics (ASX: ENP) reports Phase 2 trial success for Cohort 1 in its IV-infused Psylocin trial on Binge Eating Disorder (n=6). 50% had remission and 100% clinical improvement. (ENP, not held)
🪑 To me, more important than the results was how well ENP was able to ‘turn on and off’ the psychedelic trip. Which it did.
According to the trial registration, this was done in a small dose (5mg) over a 120-minute period, along with assisted therapy.
The next trial will test cohorts at a higher dose but over a shorter timeframe.
Nine of the 12 sessions reached peak intensity (in a two-hour session)
This is meaningful, as one of the challenges with psychedelic therapies is the long duration (8 hours generally).
If ENP is able to shorten the timeframe it can effectively, even to two hours, it can effectively 4x the throughput of patients on any given day.
Alterity Therapeutics (ASX: ATH) receives FDA approval for a Phase 3 trial pathway for ATH434 in Multiple System Atrophy. A single pivotal trial plus confirmatory evidence can support an NDA filing. (ATH, not held)
🪑 Good to get clarity on this. Stocks been running in anticipation of the trial starting.
Noxopharm Limited (ASX: NOX) requests a pre-IND meeting with the US FDA to advance its SOF-SKN™ autoimmune disease drug. (NOX, not held)
🪑 Milestone ticked.
Imagion Biosystems (ASX: IBX) extends collaboration with Siemens Healthineers for the Phase 1b/2 clinical trial. (IBX, not held)
🪑 Nice to have a big name Siemens in the announcement title, but this really just gives IBX access to Siemens' technical support to help manage the MRIs for the clinical trial.
Detailed presentation from Little Green Pharma (ASX: LGP) following the merger with Cannatrek. (LGP, not held)
🪑 Least creative merger name goes to… “LGP Cannatrek Group”
I’ve been in touch with the CEO of LGP in recent weeks, and the merger is going well. On track, and synergies building.
Nexalis Therapeutics (ASX: NX1) cancels anticipated debt funding from Point8 Capital, affecting the progression of its clinical program. (NX1, not held)
🪑 This is getting to shell territory for NX1, without the debt financing, and at a market cap of $3 million, it doesn’t have the financing to run the next clinical program.
Will need to get creative from here. Good luck.
Argent BioPharma (ASX: RGT) executes a global licensing deal for CannEpil® with Splash Beverage, including US$5.5M in upfront debt forgiveness and a 15% royalty. (RGT, not held)
🪑 Had to really squint to get the exact terms on this deal, but it looks like it is NOT US$5.5 million in cash upfront to RGT, but JUST a US$5.5M in debt forgiveness.
Also, there is a condition precedent to this deal whereby RGT and Mercer Street must still agree to the exchange of US$5.5 million of RGT debt for Splash Beverage shares, so the deal is not finalised.
ReNerve (ASX: RNV) secures marketing approval for its nerve repair products in Indonesia. (RNV, not held)
Botanix Pharmaceuticals (ASX: BOT) announces the European Patent Office's intention to grant a patent for its applicator technology used with Sofdra gel for excessive sweating. (BOT, not held)
🪑 Milestone ticked.
Cash Injection
Imugene (ASX: IMU) completes a $11.1 million placement to advance azer-cel following positive clinical data in Cohort 3 patients. (IMU, not held)
Report Card
Yesterday, Compumedics (ASX: CMP) reported record FY26 revenue of $60.3M, up 18% YOY, driven by a 70% increase in SaaS revenues, and anticipates continued EBITDA growth. (CMP, not held)
🪑 The market liked this one.
AFT Pharmaceuticals (ASX: AFP) maintains first-quarter sales growth, projects $300M FY27 revenue. (AFP, not held)
See you all tomorrow,
The Armchair Analyst
