Cancer remains one of the most pressing public health challenges worldwide, affecting millions of lives and compounding economic burdens along the way.
The companies dedicated to pioneering breakthrough therapies, and transforming patient outcomes, offer that key ingredient – hope – for patients and investors alike.
For this reason, investing in cancer therapies, despite the short-term vicissitudes of the market, will always yield dividends in the long run.
Beyond financial returns, investing in cancer biotech allows investors to contribute to the global fight against cancer, making a positive and enduring impact on public health.
Market outlook
The global oncology market continues to expand, driven by an ageing population and increased cancer incidence.
This growth trend translates into a robust market for cancer biotech products and services.
Regulatory advancements from key agencies like the US Food and Drug Administration (FDA) are streamlining approval processes for promising cancer treatments. Investors closely watch for FDA and other regulatory approvals, as they can significantly impact stock performance.
The cancer biotech sector fosters a dynamic innovation ecosystem, attracting top talent and research funding. This environment fuels ongoing advancements in cancer diagnostics and therapies.
This year was anticipated to mark the resurgence of the biotech sector, with the promise of medical innovations and lucrative acquisitions poised to reverse a slump that extends back to the tail end of the pandemic in 2021.
But broader biotech stocks have underperformed in the broader market this year, and faint signs of improvement seen earlier in the year have yet to translate into a strong turnaround.
The widely monitored XBI biotech index declined by more than 10% in 2023, in stark contrast to the S&P 500, which recorded a 13% rise during the same period.
Privately held biotech firms have encountered challenges in securing fresh capital infusion without enduring a depreciation in their valuations. Additionally, the biotech IPO market has remained sluggish, with limited offerings and inconsistent returns.
All that means that there is growth potential and opportunities to be found.
The battle against cancer is perennial. Its central role in the public imagination, not to mention its significance to the global healthcare landscape, is such that while the sector is not immune to market trials and tribulations, it seems well-equipped to endure through any economic climate.
Cancer-focused biotechs make strides in Q3
Australian cancer-focused biotechs made some big strides in the September quarter of 2023. Here’s what they got up to:
Race Oncology
Race Oncology Ltd (ASX:RAC) was busy on the clinical front during the quarter, with preclinical results showing lead asset bisantrene's efficacy against a diverse range of human tumour cell lines, bolstering confidence in the potential of RC220.
The company actively progressed in GLP toxicology and safety pharmacology studies, with final reporting anticipated in the second calendar quarter of 2024.
An exclusive licence agreement was also inked with City of Hope, granting access to intellectual property related to bisantrene's potential as an inhibitor of the human fat mass and obesity-associated protein (FTO). There are big plans for the partnership to collaborate on research and commercialisation opportunities.
Race received R&D tax incentive refunds totalling $1.66 million and $1.48 million for qualifying R&D activities, and its cash and cash equivalents stood at $17.83 million as of September 30. It made key management changes, with Dr Pete Smith appointed as executive director and Dr Daniel Tillett engaged as a consultant.
An internal review process commenced to optimise Race's clinical and preclinical programs with current financial resources, and Race expects results soon.
Radiopharm Theranostics
Radiopharm Theranostics Ltd (ASX:RAD) achieved an FDA milestone in the third quarter of 2023. The administration accepted an amended IND for 68Ga-Trivehexin (RAD 301), allowing the company to move forward with a Phase 1 study for detecting lesions in pancreatic ductal adenocarcinoma (PDAC) patients.
Also on the clinical side, data for RAD 301 presented at the 2023 European Association of Nuclear Medicine Annual Meeting showcased its potential as a superior imaging agent for PDAC and head and neck squamous cell carcinomas.
The company also obtained approval for a Phase 1 therapeutic study of PDL1-nanobody in non-small cell lung cancer (NSCLC), addressing unmet medical needs.
The supply agreement with TerThera expanded, focusing on the isotope Terbium-161 (Tb-161) for targeted cancer treatment. Tb-161's unique radiation characteristics make it a promising option, with a Phase 1 dose-escalating trial planned for the second half of 2024.
The F18-Pivalate brain glioma imaging study's publication in a prestigious peer-reviewed journal highlighted its potential for additional indications in Glioblastoma.
Pharmaxis
Pharmaxis Ltd (ASX:PXS, OTC:PMXSF), under the pending name Syntara, is undergoing significant operational changes. The sale of the mannitol business unit (MBU) was successfully completed on October 19, marking the establishment of Syntara. This strategic move allows the company to focus sharply on the development of its pipeline, with a primary focus on PXS‐5505 in haematological malignancies.
The sale of MBU has already reduced more than 60% of core costs, and further cost reductions are planned as part of the new business plan.
The separation of Pharmaxis into distinct entities, one concentrating on drug development and the other on manufacturing, is expected to increase the overall value and success of both segments. The sale of Bronchitol in the US, not meeting expectations, led to the decision to place the manufacturing business with Arna Pharma, which can optimise costs.
On the clinical side, the company’s science platform has gained international recognition with recent publications in Nature. It boasts a robust pipeline of clinical-stage assets, including a lead program in haematological malignancies.
Up to five Phase 1c/2 studies are in the pipeline, with data expected between the last quarter of 2024 and the second quarter of 2025.
The Phase 2 trial of PXS‐5505 with ruxolitinib in myelofibrosis is set to begin recruitment soon after FDA approval in Q3 2023.
The drug development business also transitioned to a smaller and focused board under new leadership.
Arovella Therapeutics
In its quarterly reporting, Arovella Therapeutics Ltd (ASX:ALA) highlighted significant progress in its invariant Natural Killer T (iNKT) cell therapy platform for cancer treatment.
Expanding into solid tumours, Arovella secured an exclusive licence with Sparx Group to develop a world-first CAR-iNKT cell therapy targeting Claudin 18.2 (CLDN18.2), a validated target expressed in gastric cancers and more.
Arovella has advanced its manufacturing capabilities through a partnership with Cell Therapies Pty Ltd, preparing for the production of ALA-101 for clinical trials in the first half of 2024. The company successfully completed an oversubscribed share purchase plan (SPP), which raised $6.3 million.
These funds will bolster the advancement of ALA-101 and Arovella's iNKT cell therapy pipeline, underscoring its commitment to pioneering innovative cancer therapies in blood cancers and solid tumours.
Arovella reported pro-forma cash and cash equivalents of $5.32 million as of September 30, 2023, with expectations of an additional R&D rebate of around $2 million in the next quarter of the year, bolstering its funding capabilities.
The company reported a net cash usage of $1.99 million during the quarter, with research and development and staff costs accounting for about 89% of cash expenditures.
During the quarter Arovella was actively engaged with investors through Bioshares Biotech Summit and a non-deal investor roadshow.
Patrys
Patrys Ltd (ASX:PAB) reported significant advancements in its operational and clinical efforts during the quarter. The company is on the verge of completing a thorough audit of the manufacturing process for PAT-DX1, with validation from a Contract Development and Manufacturing Organisation (CDMO) and an independent evaluator.
This audit, expected to conclude by the end of the year, will enhance risk mitigation measures during manufacturing. Furthermore, Patrys is actively working to secure a production slot with its CDMO, aiming for initiation in the first half of next year.
In parallel, Patrys anticipates receiving final reports for Good Laboratory Practice (GLP) toxicology studies for PAT-DX1 during the current quarter. These reports will be instrumental in supporting the initiation of the first-in-human clinical trial for PAT-DX1.
Patrys is making progress in the development of PAT-DX3, a full-sized IgG deoxymab. The Master Cell Bank (MCB) for PAT-DX3 has undergone thorough characterisation and validation, marked by a successful integration run. This advancement positions Patrys to proceed with GLP manufacturing for PAT-DX3, enabling preclinical toxicology studies and potential clinical trials, subject to securing additional capital.
Alongside the scientific achievements, Patrys is actively engaged in business development activities. The company's CEO recently participated in the BIO International Convention in Boston, fostering discussions with prominent global pharmaceutical and biotechnology firms.
Read more: Patrys bolsters finances through $2.7 million R&D Tax Incentive rebate
Imugene
Imugene Ltd (ASX:IMU, OTC:IUGNF) achieved several significant milestones during the September quarter, including securing a global exclusive licence for Precision Biosciences' azer-cel allogeneic CD19 CAR T cell therapy program.
Azer-cel has demonstrated promising results in patients with non-Hodgkin’s lymphoma and acute lymphocytic leukemia, with an 83% overall response rate (ORR) and 61% complete response (CR) rate. The FDA has given positive feedback on the manufacturing process, with the IND successfully transferred to Imugene.
Also making news for Imugene is its Phase 1 MAST trial for VAXINIA, a cancer-fighting virus, which is progressing through dose escalation cohorts, targeting patients with metastatic or advanced solid tumours.
Imugene has initiated a collaboration with RenovoRx to enhance the delivery of its oncolytic virus therapy for challenging cancers, such as pancreatic tumours, using RenovoRx's TAMP (Trans-Arterial Micro-Perfusion) therapy platform.
In addition, Imugene secured a Japanese patent for its PD1-Vaxx drug candidate, providing protection until 2038 and covering the composition and treatment method for generating a therapeutic antibody response against the PD1 checkpoint target.
Financially, Imugene reported a robust cash position of $163.3 million at the end of the quarter. The biotech Top of Formalso strengthened its management team with key appointments, including a new chief operating officer (COO), chief medical officer (CMO), and senior vice president of Clinical Development.
Prescient Therapeutics
Prescient Therapeutics Ltd (ASX:PTX, OTC:PSTTF) ended the quarter with $18.7 million in cash reserves, including $16 million in term deposits. The company maintained an operating expenditure of $3.2 million, aligning with its budget, with $2.4 million directed towards research and development (R&D) and clinical activities.
In the clinical arena, the Phase 1b trial of PTX-100 for relapsed and refractory T cell lymphomas is progressing well, with encouraging results and plans to report data in December 2023. Prescient is preparing to engage the FDA in early 2024 to discuss the Phase 2 trial's design and potential registrational study.
Prescient is actively ramping up manufacturing of PTX-100 drug product to support the Phase 2 study. Meanwhile, the PTX-200 trial in acute myeloid leukemia (AML) is nearing completion, with further development avenues under consideration.
In terms of innovation, CellPryme-M has demonstrated superiority over existing cytokines in CAR-T cell therapy, showing potential to enhance CAR-T cell function in vivo. Collaborating with Thermo Fisher Scientific (NYSE:TMO), Prescient achieved promising results in non-viral engineering of CAR-T cells.
Prescient remains actively engaged with the biotech sector, participating in conferences and meetings to build relationships and showcase progress.
Noxopharm
Noxopharm Ltd (ASX:NOX, OTC:NOXOF) detailed a range of achievements during the quarter. Post-quarter end, the company was granted orphan drug designation (ODD) by the FDA for CRO-67, a pancreatic cancer treatment candidate.
ODD status brings tax credits, fee exemptions, and potential market exclusivity for seven years post-approval, a remarkable achievement for an Australian company.
Read more: Noxopharm granted US orphan drug status for CRO-67 pancreatic cancer therapy
Throughout the quarter, Noxopharm maintained its focus on advancing Chroma™ and Sofra™ preclinical platforms, actively presenting these assets at international events like the RNA Leaders USA Congress and the American Association of Cancer Research (AACR) Special Conference on Pancreatic Cancer.
Sofra's mRNA vaccine enhancer, SOF-VAC™, garnered attention at the RNA Leaders USA Congress, offering growth potential for Noxopharm in enhancing mRNA vaccines and RNA drugs.
In the realm of research, Noxopharm showcased the efficacy of SOF-XX in reducing skin inflammation at the 15th International Congress on Systemic Lupus Erythematosus (LUPUS 2023), presenting a unique solution for immunology-related diseases.
The company also engaged with industry, academia, and government stakeholders, including Australia's Chief Scientist, Dr. Cathy Foley, to discuss research activities and corporate priorities.
Financially, Noxopharm reported a cash balance of A$1.14 million as of September 30, 2023. Operating cash outflows during the quarter reduced to A$1.83 million, positioning the company well to meet its funding needs in the foreseeable future. The company continues to participate in the investigator-initiated IONIC Phase 1 proof-of-concept trial, combining Veyonda with Bristol Myers Squibb's checkpoint inhibitor Opdivo®.