Health Check: And the EOFY biotech winner is … gasp … a pot stock
Paradigm shares soar 34% after $41 million convertible note deal
Biotechs turn to debt funding
The ASX biotech sector's best EOFY performer has come from left field: the local and European focused medicinal cannabis supplier Bioxyne (ASX:BXN).
According to the Health Check Biotech Pulse – trademark pending – Bioxyne shares soared 720% in 2024-25, leaving its largely poorly performing pot peers in the dust.
Bioxyne's fortunes have been driven by its Breathe Life Sciences arm, which purveys cannabis products including not just flowers and oils but pastilles, vapes, pessaries and suppositories (we kid you not).
The company recently upgraded full-year revenue guidance from $25 to $28 million and promised positive cash flow and – gasp! – profitability.
Amplia (ASX:ATX) took second place, with a 233% gain (300% over the last month).
The stock soared after Amplia unveiled clinical trial results showing two 'complete responses' among a cohort of advanced pancreatic cancer patients.
Orthocell (ASX:OCC) shares vaulted 220% on the back of US Food & Drug (FDA) approval of its novel nerve repair tool Remplir.
Imricor Medical Systems (ASX:IMR) shares ended the year 189% to the good, as the company eyes FDA approval of its world's first MRI-guided ablation catheter.
Other triple digit dazzlers were myelofibrosis drug developer Syntara (ASX:SNT) (up 130%), autism testing device play Blinklab (ASX:BB1) (up 116%) and the beloved radiology imaging tearaway ProMedicus (ASX:PME) (up 110%).
Sorry – there's no prize for trying
Sadly, there's still too much red ink in the rankings.
In your columnist's opinion, investors have marked down many worthy stocks unfairly.
But we're not in primary school and everyone doesn't get a ribbon for trying, so the record books will show that medication compliance group MedAdvisor (ASX:MDR) led the falls with an 82% decline.
Other laggards are the multi-pronged Universal Biosensors (ASX:UBI) (down 76%), Proteomics International Laboratories (ASX:PIQ) (down 62%, see below), lung imager 4D Medical (ASX:4DX) (down 56%) and Clarity Pharmaceuticals (ASX:CU6) (down 51%).
Shares in the busy Clarity shares peaked at $8.74 last October – a 70% gain for the year – but even after the subsequent sell off the company still bears an $800 million market cap.
Strictly speaking, Opthea shares fared the worst after the company's infamous eye disease trail failure in March.
Opthea shares never resumed trading, so the official records show a 73% gain when in fact the stock is worth next to nothing.
Genetic Technologies and Nuheara are also missing from the laggards list, only because they went into administration and subsequently de-listed.
Paradigm shifts to convertible notes
With the equity capital raising outlook still looking shaky, Paradigm Biopharmaceuticals (ASX:PAR) has become the latest in a string of biotechs to tap alternative funding sources.
The developer of a knee osteoarthritis (OA) drug candidate has tapped US$27 million ($41.2 million), by way of convertible notes.
These have been issued to New York based alternative funder Obsidian Global Partners.
Under the terms, Paradigm will draw an initial US$7 million to fund patient recruitment, trial operations and regulatory milestones.
The balance of the facility is available at Paradigm's discretion, 'offering operational flexibility and strategic control over future funding needs'.
Barring default, the notes are interest free.
The cash will help to fund Paradigm's pivotal phase III trial of its repurposed drug candidate pentosan polysulphate sodium (PPS, or Zilosul).
Investors have keenly awaited this trial initiation – and confirmation of how it will be funded. Reflecting this, Paradigm shares this morning surged 34%.
The 466-patient study in underway across up to 15 Australian and 50 US sites.
The company says it is now fully funded up to the interim analysis of the first 50% of patients, due in mid 2026.
Last week Paradigm hedged its bets by paying as much as $16.5 million for Proteobioactives Pty Ltd ($500,000 upfront)
This company owns an early-stage oral candidate for minor to mild OA, which combines PPS with a COX-2 inhibitor (Coxib).
When debt is not a dirty word
The term 'debt' can have unfortunate connotations – especially in the context of your columnist's household budget.
But it can be cheaper than equity and has the benefit of being non-dilutive and more flexible with the timing of drawdowns.
Often, it's simply more accessible than equity.
The developer of better working anti-infectives, Recce Pharmaceuticals (ASX:RCE) last month availed of a US$20 million ($30 million) draw-down facility from the New York based Avenue Capital Group.
Recce pockets an initial US$7.5 million and a further US$5 million between April and September this year.
The remainder is available in calendar 2027, with all the amounts subject to 12.75% interest.
The funds will support Recce's two phase III registrational studies on diabetic foot infections and acute bacterial skin and skin structure infections.
Recce also recently raised $15.8 million of equity.
Last month, dermatology group Botanix Pharmaceuticals (ASX:BOT) unveiled a circa US$30 million ($48 million) debt facility with Kreos Capital.
Kreos is an arm of the world's biggest investment manager Blackrock.
The facility provides for circa $US20 million to be drawn now, with the remainder to be tapped by October 2026 at the company's option.
Under certain conditions, Kreos Capital can convert 20 percent of the loan into Botanix shares, at 33 cents apiece.
Botanix developed Sofdra, a treatment for excessive underarm sweating and has started selling the product in the US.
In mid-April Botanix also raised $40 million of equity, via an institutional placement.
Proteomics secures non-dilutive $6 million
Then there's non-dilutive grant funding.
The Perth-based Proteomics today said it had secured a $6 million investment from the federally funded Bioplatforms Australia and the WA government.
The funding will support developing an accredited protein biomarker analysis platform, in partnership with the University of Western Australia.
Proteomics chips in $1 million over the three-year funding period.
Proteomics has commercialised a predictive test for diabetic kidney disease and is developing assays for endometriosis, esophageal cancer and oxidative stress.
Meso-blast off for FDA application?
Stem-cell drug developer Mesoblast (ASX:MSB) says the company and the FDA are 'aligned' on what the company needs to do before it lodges a US marketing application for its heart disease candidate, Revascor.
In late December Mesoblast won FDA approval for its childhood graft-versus-host disease (GvHD) candidate.
This followed years of the company and the agency being decidedly 'unaligned'.
Given the heart disease heart indication is much bigger than GvHD, today's news is more significant than it may appear at first blush.
Mesoblast intends to file for accelerated approval by the end of the year. This is to treat ischemic heart failure patients with reduced ejection fraction and inflammation.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
News.com.au
an hour ago
- News.com.au
Productivity Commission calls for changes to road user charges to fund road upgrades
The federal body tasked with boosting Australian living standards has reissued calls for a national road user charge to help fund major infrastructure projects, which would also force drivers of electric vehicles to contribute to road maintenance. As it stands, EV drivers are not subject to the 51.6 cents per litre fuel excise drivers ultimately pay when refuelling at the bowser. The call to arms was detailed in the Productivity Commission's (PC) analysis of the National Competition Policy – the fourth of five reports handed to Jim Chalmers ahead of the Economic Reform Roundtable later this month. This follows long-term calls by the PC to enact a road user charges on all vehicle types, with a current charge only applied to heavy vehicles through a diesel excise. 'Road infrastructure should be funded through user charges (prices) that reflect the efficient cost of providing and maintaining that infrastructure,' the report said. 'By giving drivers a clear signal about the cost of infrastructure, they would have an incentive to use it more efficiently. 'Moreover, there will be a signal to infrastructure providers where changes in road capacity are warranted.' It said national reform should be prioritised following the High Court challenge which overruled the Victorian government's attempt to put in place a 2 cents a kilometre on EV drivers in 2023. The PC also noted that the 'growth in use of electric vehicles' should be 'added impetus' for priority reform, with the commission set to give its final report to the Treasurer in late October. 'The decision of the High Court rules out state-based distance road user charges and means governments need to consider a national approach to road funding,' it said. 'This opens the opportunity to design a system that is less fragmented and better reflects the costs of providing and using road infrastructure.' In an earlier report released this week, the PC urged Labor to scrap subsidies on EVs, like the fringe benefits tax exemption on electric cars and plug-in hybrids. Instead, it said the New Vehicle Efficiency Standard should be the 'main tool for promoting clean vehicles'. Previously Mr Chalmers has said the government has no immediate plans to tax EV users, however he said discussions with the sector and states had been ongoing. 'Over time, the use of fossil fuels in our car fleets will come down, and EV use will go up,' he told reporters in July. 'We've seen that, and we're making a contribution to that with our policies and that will have implications for the tax base.' However, despite lags at a federal level, the NSW state government has flagged a distance-based charge for eligible EVs set to come into place from July 1, 2027, or when EVs make up 30 per cent of all new vehicle sales. The PC's analysis of competition policy also found regulating Australian standards with overseas standards could boost GDP by up to 0.2 per cent a year – a nominal increase between $1.9bn to $3.8bn. Occupational licensing reform, which would make it easier for workers to move interstate, was noted as a competition-boosting change which would result in the biggest affect on the economy, which could deliver between a $5bn to $10bn boost to GDP. This comes after the government flagged changes to design a national scheme for people in electrical trades in the March federal budget.
ABC News
2 hours ago
- ABC News
Money Matters: How much super do you really need to retire comfortably?
Your panel of experts, Nick Bruining, Phil George, and Gavin Hegney share their two cents. 01:23 How much money do you really need to retire on? Nick thinks it's less than what the super funds say. 05:05 The highs and lows of the 2025 Diggers and Dealers mining conference. 10:52 An ABC listener asks when to change money to get the best exchange rate when heading overseas. The panel debates credit card exchange rates as well as advice for exchanging cash. Money Matters is your weekly guide to the world of finance, money and wealth. Every Thursday, an expert joins Nadia Mitsopoulos on ABC Radio Perth for a insights about personal finance issues and how they might affect you.
News.com.au
3 hours ago
- News.com.au
Perth businessman Ted Powell has made an unprecedented donation of $100m to Murdoch University's veterinary school
Perth businessman Ted Powell has made an unprecedented donation of $100m to Murdoch University's veterinary school. The gift is the largest donation ever received by a West Australian university and one of the largest received by any Australian uni. 'You can't spend $100m when you're 74 years old. It's just not possible,' Mr Powell, who made his fortune founding Offshore Incorporations Limited, said on Thursday. 'I've given almost as much as I can, but you know, I'm not going to go hungry. 'I know my late wife, Dee, an animal lover and a most generous person, would also be immensely proud of this project.' Mr and Mrs Powell, who did not have children, established The Ragdoll Foundation, which has provided financial support to more than 140 Murdoch students who completed their degrees through a scholarship program. The $100m donation will be used to redevelop Murdoch's veterinary school with a 9600 sqm facility that will be large enough to increase the number of vet students who can be trained in WA by 50 per cent. Mr Powell said there were many good causes in the medical and educational fields and encouraged anyone who was financially well-off to consider giving to worthy causes. 'I am absolutely delighted that this gift will support the redevelopment of the Veterinary School,' he said. Vice Chancellor Andrew Deeks said Mr Powell's extraordinary act of generosity would help ensure WA continued its role as a leading hub for animal research, teaching and training. 'Veterinary Medicine was one of 10 foundation courses offered by Murdoch when we opened 50 years ago and a commitment to the environment and conservation are part of the University's DNA,' the vice chancellor said. 'The discipline has advanced significantly over that time, as have the safety requirements for biological laboratories and animal facilities.' The new facility will allow the university to build on its conservation, animal care and welfare programs, as well as provide more cutting edge research. It will also provide better service for the agricultural and scientific community and broader WA community. Professor Deeks said the development would strengthen research in animal health and the University's One Health agenda which recognised the links between human, animal and environmental health. 'On behalf of Murdoch University, I cannot thank Ted Powell enough for his generosity, support and foresight,' he said. 'He will leave a legacy for the Western Australian veterinary profession, animal research – and for animals great and small – which will resonate for generations to come.'
