Bionomics Ltd

BNO Details
New pre-clinical data from ongoing studies supports further clinical evaluation of BNC101: Bionomics Ltd has recently released new pre-clinical data from ongoing studies of BNC101, its anti-LGR5 cancer stem cell drug candidate being developed to treat solid cancer. The data presented at the annual American Association for Cancer Research conference in Washington, DC demonstrates complementary anti-tumor activity between BNC101 and checkpoint inhibitors. The data provides preclinical evidence in a mouse model of colon cancer that treatment with BNC101 and a checkpoint inhibitor is associated with a greater reduction in T regulatory cells, an immune suppressive cell, and a modest increase in tumor attacking cytotoxic T cells compared to treatment with a checkpoint inhibitor alone. The data strongly supports further clinical evaluation of BNC101 in combination with checkpoint inhibitors. In H1 FY17, Bionomics revenue from ordinary activities witnessed a decrease by 30% to A$2.4m while net loss remained almost flat at A$9.7mn as expected. Although a concrete outlook/ guidance on financials has not been provided for full year, BNO expects to continue with its investments in pipeline programs.We recommend ‘Speculative Buy’ on the stock at the current market price of $ 0.35
 

BNO Daily Chart (Source: Thomson Reuters) 

Mesoblast Ltd

MSB Details
MPC-150IM,FDA clearance for heart disease trial seems to be a big booster: The United States Food and Drug Administration (FDA) has given a green signal to Mesoblast Ltd for conducting a 24-patient trial combining group’s proprietary allogeneic Mesenchymal precursor cells (MPCs) with corrective heart surgery in children under the age of five with hypoplastic left heart syndrome (HLHS). Boston Children’s Hospital has extended sponsorship and funding for trial with support from Bulens and Capozzi Foundation and the Ethan Lindberg Foundation. Particularly, Mesoblast’s product MPC150IM is evaluated in a Phase-3 trial with 600 patients for Class II/III chronic heart failure (CHF) and in a United States National Institutes of Health (NIH) funded Phase 2b trial of 159 patients with NYHA Class IV CHF. These advanced programs and the new study in children are built on a foundation of scientific data and prior clinical trial results that support the potential for Mesoblast’s immunoselected and culture expanded MPCs to release an array of biomolecules following intramyocardial administration that act to both dampen damaging inflammatory processes and initiate reparative processes in the failing heart through new blood vessel formation, cardiac muscle cell growth, and reduction in fibrosis.
 
 
Product Portfolio (Source: Company Reports)
 
CHF prevalence in the United States is expected to grow 46% by 2030, affecting more than 8mn Americans. The estimated annualized cost for CHF care in the United States is US$30.7bn and is projected to grow to approximately $69.7 billion by 2030. During Q2 FY17, Mesoblast reported revenues of $0.6mn as compared with $4.0mn during Q2 FY16 on account of decline in a non-cash item (related to MPC-150-IM product) as it was recognized in Q2 FY16. Net loss attributable to shareholders stood at 5.27c/share in Q2 FY17. However, the company is in a strong position to fund its R&D programs. The group has also received A$3.7mn from Australian Government for research and development activities that were conducted in FY16. MSB stock has risen 102% in last six months (as at April 06, 2017) and is now trading close to its 52-week high price. We give a ‘Hold’ recommendation on the stock at the current market price of $ 2.43
 

MSB Daily Chart (Source: Thomson Reuters) 

Opthea Ltd

OPT Details
Positive results from Phase 1/2A clinical trial of OPT-302: Opthea Ltd is a developer of novel biologic therapies for the treatment of eye diseases, and has announced positive results from its Phase 1/2A clinical trial of OPT-302, a novel VEGF-C/D ‘Trap’ therapy for wet age-related macular degeneration (wet AMD). OPT-302 demonstrated clinical activity in all patient groups investigated, including naïve and prior-treated patients in both the monotherapy and combination OPT-302 + Lucentis® groups. Improvements in visual acuity (VA) and retinal swelling (central subfield thickness (CST) and subretinal fluid (SRF) were observed suggesting additional clinical benefits with more complete suppression of VEGF-A and VEGF-C/D. The company had recently announced for raising an equity capital of A$45mn to fund the expanded clinical development of OPT-302 and has already completed the institutional component. The offer consisted of a placement to certain institutional and sophisticated investors to raise ~A$35mn and A$10mn through non-renounceable entitlement offer. The offer price per new share was set at A$0.93, representing a 14.8% premium to March 29, 2017 closing price. The stock has risen about 18.5% in last one month (as at April 06, 2017) and rose 3% on April 07, 2017. The stock is already trading at high levels and we give an ‘Expensive’ recommendation on the stock at the current market price of $ 1.17
 

OPT Daily Chart (Source: Thomson Reuters) 

Zelda Therapeutics Ltd

ZLD Details
Zelda Therapeutics Enters Strategic Partnership with Animal Health Company, CannPal: Zelda Therapeutics Ltd executed a strategic partnership with CannPal Pty Ltd (CannPal), an Australian company focused on developing cannabis based prescription and non-prescription medicines, and animal feed nutrition for the emerging global pet pharmaceutical market. The agreement is to promote and encourage collaborative activity to improve the offerings of both CannPal and Zelda, and exploit opportunities of mutual interest in both the human and animal pharmaceutical markets as the deal provides Zelda with meaningful exposure to the large and growing animal health market. This agreement opens new opportunities for Zelda through exposure to a potentially very large market for alternative animal therapies, and access to a pipeline of new medicines being developed for the animal market, which Zelda will have the first rights to pursue commercialization within the human market, and expansion of Zelda’s current research focus areas. The company had raised equity capital of AUD6mn to accelerate and expand its research programs for cancer in Australia and Chile, and it is expected to start two new clinical trial programs in H2FY17. ZLD stock has risen 334.7% in last six months (as at April 06, 2017) and is trading at higher levels. We recommend a ‘Hold’ on the stock at the current market price of 0.105
 

ZLD Daily Chart (Source: Thomson Reuters) 

Cynata Therapeutics Ltd

CYP Details
Completion of Cymerus Evaluation: Cynata Therapeutics Ltd is the only company in the world that can mass-produce therapeutic stem cells at a consistent quality and affordable cost. Cynata’s Cymerus technology overcomes the challenges inherent in first generation production methods and the regulatory hurdles by industrialising the production of mesenchymal stem cells (MSCs).Further, R&D has demonstrated strong data in pre-clinical studies for the treatment of asthma, heart attack, GvHD (Graft-versus-Host disease) and critical limb ischemia.
 

Product Pipeline (Source: Company Reports)
 
Recently, apceth GmbH & Co has completed its evaluation of Cynata’s proprietary Cymerus MSC technology in its in-house cell culture and genetic modification systems. This indicated successful outcome as Cynata’s Cymerus cells demonstrated characteristics appropriate for apceth’s technology. The licensing rights in oncology have therefore returned to Cynata and the Company is undertaking its own research program in genetically modified MSCs in cancer through a collaboration with Massachusetts General Hospital/Harvard Medical School.  Market for regenerative medicine is expected to grow to US$170bn by 2020 and this lays a path for growth momentum for the company. CYP stock has fallen 39.5% in last three months (as at April 06, 2017) and we recommend a ‘Speculative Buy’ on the stock at the current market price of $ 0.47
 

CYP Daily Chart (Source: Thomson Reuters) 

SomnoMed Ltd

SOM Details
Sales volume growth: SomnoMed Ltd is engaged in the business of producing and selling devices for the oral treatment of sleep related disorders primarily in the Asia Pacific region, North America and Europe. During H1 FY17, SomnoMed’s overall sales volume grew by 14.9% to 33,309 devices and group revenues grew by 11.5% year on year (yoy) to $23.8mn. However, operating profit declined by 2.8% on account of start-up and other operating expenses. In the last five days, the stock price moved up 3.6% (as at April 06, 2017). We recommend a ‘Hold’ on the stock at the current market price of $ 3.41
 

SOM Daily Chart (Source: Thomson Reuters)

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