Currency in USD
Last close As at 17/03/2023
USD2.18
▲ −0.21 (−8.63%)
Market capitalisation
USD151m
Research: Healthcare
Incannex Healthcare’s Q223 cash flow report provided the period’s key operational highlights. Notable activities include the start of a bioavailability and bioequivalence (BA/BE) study for its lead clinical asset, IHL-42X, ahead of the anticipated investigational new drug (IND) submission in Q1 CY23, a positive pre-IND meeting with the FDA on IHL-216A (for concussion and traumatic brain injury, TBI) and the completion of patient dosing in the Phase I trial of IHL-675A (for rheumatoid arthritis, inflammatory bowel disease and lung inflammation). In addition to progressing its internal pipeline, Incannex has focused on expanding IHL-42X’s patent portfolio, a critical part of its developmental strategy, in our view. With a cash balance of A$41.4m (US$29.4m) at end-Q223, supported by a A$13m private placement, management has guided that at the current quarterly burn rate (A$4.3m), the company is funded into Q1 CY25.
Incannex Healthcare |
Pipeline advancement to support growth plan |
Quarterly update |
Pharma and biotech |
1 February 2023 |
Share price performance Business description
Analysts
Incannex Healthcare is a research client of Edison Investment Research Limited |
Incannex Healthcare’s Q223 cash flow report provided the period’s key operational highlights. Notable activities include the start of a bioavailability and bioequivalence (BA/BE) study for its lead clinical asset, IHL-42X, ahead of the anticipated investigational new drug (IND) submission in Q1 CY23, a positive pre-IND meeting with the FDA on IHL-216A (for concussion and traumatic brain injury, TBI) and the completion of patient dosing in the Phase I trial of IHL-675A (for rheumatoid arthritis, inflammatory bowel disease and lung inflammation). In addition to progressing its internal pipeline, Incannex has focused on expanding IHL-42X’s patent portfolio, a critical part of its developmental strategy, in our view. With a cash balance of A$41.4m (US$29.4m) at end-Q223, supported by a A$13m private placement, management has guided that at the current quarterly burn rate (A$4.3m), the company is funded into Q1 CY25.
Year end |
Revenue (A$m) |
PBT* (A$m) |
EPS* |
DPS |
P/E |
Yield |
06/21 |
2.0 |
(8.2) |
(0.83) |
0.0 |
N/A |
N/A |
06/22 |
0.8 |
(14.9) |
(1.25) |
0.0 |
N/A |
N/A |
06/23e |
0.0 |
(20.6) |
(1.35) |
0.0 |
N/A |
N/A |
06/24e |
0.0 |
(33.4) |
(2.12) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are normalized, excluding amortization of acquired intangibles, exceptional items and share-based payments.
Incannex made several advancements in its clinical pipeline during the quarter. Following submission of a pre-IND package to the FDA in August 2022, the company reported a positive pre-IND meeting for its proprietary inhaled drug product, IHL-216A, for treating concussion and TBI. In response, the FDA provided detailed feedback and guidance on IHL-216A’s future clinical trial development plan. For IHL-42X in obstructive sleep apnea, Incannex has initiated a BA/BE study, which is a prerequisite to pursue the FDA’s 505(b)(2) new drug application regulatory pathway. With a planned IND application in CY Q123, Incannex intends to initiate an international, multi-site Phase II/III study in CY H123, which would include trial sites in the United States. Approval of the IND would, in our view, represent a catalyst for the company’s share price.
Incannex also announced completing patient dosing in the Phase I study of its anti-inflammatory drug, IHL-675A. Final data from the study will be released in Q1 CY23. Based on encouraging preliminary safety data (healthy volunteers, n=36) from the trial and absence of adverse events, the company has begun preparing for Phase II clinical trials (n>100), which will initially target patients with rheumatoid arthritis, followed by inflammatory bowel disease and lung inflammation. Alongside this, Incannex is preparing for a pre-IND meeting for IHL-675A in the treatment of arthritis, with a likely IND submission in parallel with the initiation of an Australian Phase II study. More recently, the company announced the start of an independent analysis of the interim data of its ongoing Australian Phase II Psi-GAD1 study, with recommendations expected in March 2023.
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Research: Healthcare
On 27 January, the US FDA approved Stemline Therapeutics’ (wholly owned US subsidiary of the Menarini group) elacestrant (Orserdu) as second-line treatment for ER+/HER2-, ESR1-mutated advanced or metastatic breast cancer (mBC), making it the first oral selective estrogen receptor degrader (SERD) to be approved for the indication and the first-ever approved drug for cases with the ESR1 mutation (~40%of all cases in this category). We see this as a material development for Context Therapeutics, which is currently undertaking Phase Ib trials (ELONA trial in collaboration with Menarini) for its drug ONA-XR in combination with elacestrant for the treatment of second/third-line HR+/HER2- mBC. ONA-XR has previously shown promising preclinical data in combination with anti-estrogen therapy, and improved efficacy, if demonstrated in the ELONA trial, should open the door for partnering prospects and create significant market opportunity for Context, in our opinion.
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