Currency in -
Last close As at 09/06/2023
-6.60
— 0.00 (0.00%)
Market capitalisation
AUD15m
Research: Healthcare
Medlab Clinical moves a step closer to realising its plans for a secondary listing on the Nasdaq following filing of the IPO registration statement with the US Securities and Exchange Commission. As part of the offering, the company plans to issue c 1.8m share units (ordinary shares plus an equivalent number of warrants) at US$4.45/share and c 1.8m pre-funded warrants at US$4.4999/unit (nominal exercise price of US$0.0001/unit) to raise c US$8m in gross IPO proceeds (c US$7m net). Following this announcement, we believe that Medlab remains on track to meet its Q1 CY23 target for the listing. We expect the funds raised to be used in supporting the upcoming investigational new drug (IND) submission for NanaBis in the United States (to commence Phase III trials) and progressing Medlab’s development pipeline. We will update our valuation (currently A$236.1m or A$103.5/share) following the US listing.
Medlab Clinical |
Moving closer to the Nasdaq IPO |
Nasdaq listing update |
Pharma and biotech |
4 January 2023 |
Share price performance Business description
Analysts
Medlab Clinical is a research client of Edison Investment Research Limited |
Medlab Clinical moves a step closer to realising its plans for a secondary listing on the Nasdaq following filing of the IPO registration statement with the US Securities and Exchange Commission. As part of the offering, the company plans to issue c 1.8m share units (ordinary shares plus an equivalent number of warrants) at US$4.45/share and c 1.8m pre-funded warrants at US$4.4999/unit (nominal exercise price of US$0.0001/unit) to raise c US$8m in gross IPO proceeds (c US$7m net). Following this announcement, we believe that Medlab remains on track to meet its Q1 CY23 target for the listing. We expect the funds raised to be used in supporting the upcoming investigational new drug (IND) submission for NanaBis in the United States (to commence Phase III trials) and progressing Medlab’s development pipeline. We will update our valuation (currently A$236.1m or A$103.5/share) following the US listing.
Year |
Revenue (A$m) |
PBT* |
EPS* |
DPS |
P/E |
Yield |
06/21 |
8.1 |
(12.4) |
(6.3) |
0.0 |
N/A |
N/A |
06/22 |
6.0 |
(8.4) |
(3.1) |
0.0 |
N/A |
N/A |
06/23e |
7.7 |
(8.8) |
(3.8) |
0.0 |
N/A |
N/A |
06/24e |
7.7 |
(9.6) |
(4.2) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
Medlab is focused on developing its lead asset, NanaBis, which is a 50:50 formulation of synthetic CBD and dronabinol (synthetic THC) for treating cancer-induced bone pain. NanaBis is awaiting approval to initiate Phase III studies, with plans to commence patient enrolment in Q4 CY23. The Phase III study will be a multi-centre (Australia, United States and United Kingdom), double-blinded, placebo-controlled study and is expected to enroll 360 patients. Medlab has prepared a drug master file and we expect it to approach the FDA with an IND application in Q1 CY23. The company is also developing NanoCBD, a 100% CBD formulation treating occupational stress and mental health issues.
Plans for a secondary listing in the United States were announced in June 2022, and we see the recent announcement as a key step in realising Medlab’s target of the Nasdaq IPO in Q1 CY23. We note that the offering size (1,797,752 share units) is around 79% of the currently issued capital on the ASX although the offer price of US$4.45/share (which translates to A$6.5/share) is at a discount to the average ASX trading price of A$7.1/share in December 2022. In addition to the above, the underwriters (EF Hutton) also have a 45-day option to purchase up to 269,662 additional units to cover over-allotments.
We expect the proceeds to be used to develop NanaBis for cancer-related bone pain, NanoCBD for stress and MDC2000 for depression. Due to the high activity and liquidity associated with the US biotech market, the potential Nasdaq listing could support the company in progressing its development pipeline, in our view.
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Research: Healthcare
Newron Pharmaceuticals’ share price has responded well to its announcement of encouraging interim efficacy data for the use of evenamide as an add-on therapy to antipsychotics in moderate to severe treatment-resistant schizophrenia (TRS). Patients who completed (85 out of 100) the six-month (30-week) treatment period (study 015) were found to show statistically significant and clinically meaningful improvements in the symptoms of psychosis. Importantly, the six-month data showed a sustained and continued improvement in key efficacy measures compared to results after six weeks (study 014) of treatment, with the proportion of patients achieving clinically meaningful improvements increasing over time. We view these latest results as highly supportive of evenamide’s clinical utility in TRS, further justifying management’s strategy of expanding into this schizophrenia patient population.
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