Botanix Pharmaceuticals Limited

BOT Details

Stock Zoomed ~148% in Last 1-Month:  Botanix Pharmaceuticals Limited (ASX: BOT) is a clinical stage medical dermatology company. The company recently updated that it has issued 900,000 ordinary shares for a consideration of $0.03 per share for the purpose of exercising unlisted options.

The company presented the antimicrobial data from studies conducted with its antimicrobial product BTX 1801. Results from the study position Botanix as a leading developer of treatments of skin diseases.

In the March quarter cash flow report, the company reported substantial clinical progress with the completion of psoriasis (BTX 1308) study. In addition, the company is nearing the completion of recruitment for the acne (BTX 1503) study and reported progress in atopic dermatitis (BTX 1204) study.

Updates on Clinical Development:Results of the BTX 1308 Phase 1b psoriasis study are being processed and analysed by researchers and the top line data from the study was scheduled to be available on the second quarter of the calendar year 2019.

The company reported strong patient recruitment for Phase 2 clinical study of its lead product, BTX 1503 for the treatment of moderate to severe acne. The recruitment was expected to complete in 2Q CY19 and data is expected to be available in the third quarter.

The company has also continued to attract growing interest in the BTX 1204 Phase 2 atopic dermatitis study with a number of new sites joining the study resulting in acceleration of patient recruitment. Data for the study is expected to be read out in Q4 CY2019.

During the quarter, the company reported net cash outflows of A$4.3 million with A$4.2 million invested in R&D activities associated with clinical programs.

Financial Highlights: During the half year ended 31 December 2018, the company generated revenue amounting to $4.74 million, up 163% on prior corresponding revenue of $1.80 million. Loss for the year amounted to $4.18 million as compared to the loss of $2.39 million in the prior corresponding period.


H1FY19 Income Statement (Source: Company Reports)

Outlook: The company seems to have a transformative year ahead with the planned completion of two Phase 2 studies, a Phase 1b patient study, along with milestones for the broader pipeline and the Permetrex^TM technology platform. Data read-outs from three fully funded studies are due in 2019, that will drive significant value increase. In addition, the recent approval of first cannabidiol product, Epidolex® for epilepsy, validates the safety profile and potential of synthetic cannabidiol for skin treatment. Permetrex^TM, a novel skin delivery technology enhanced the delivery of cannabidiol as compared to traditional approaches.

Stock Recommendation: On the stock performance front, the company’s share has reported high YTD returns of 256.16% and gained ~148% in the last 1-month. The stock is operating close to its 52 weeks high level of $0.290. As discussed in the outlook, the data for clinical studies, being conducted by the company for various products, is still awaited. Results from the same are anticipated to be out from Q1 through Q4 CY2019, which is expected to add value to the business. However, the stock has seen substantial gain in the last one month, corresponding to the news flows. Although BOT has been a consistent value generator for the investors, and we presume that the current price might have discounted all the recent positive developments. Hence, we suggest investors to book profit at the current level and recommend a “Sell” rating on the stock at the current market price of $0.245, down 5.769% on 11 July 2019.


BOT Daily Chart (Source: Thomson Reuters)

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