share cafe logo  

Prescient Seeing Into The Future

Get More Commentary, Discussion & Market Information On -


Prescient could end 2015 with five active clinical trials investigating drugs with the potential to bring better outcomes for cancer patients around the world.

In its former incarnation as Virax Holdings, Prescient Therapeutics (PTX) gave its shareholders the full gamut of experiences on the roller-coaster ride of biotech investment, ranging from a 60% fall in share price February 2003, on the announcement that a proposed HIV vaccine did not elicit an immune response, to a 90% increase in 2009 following a licensing deal.

The company eventually went into voluntary administration, but was reconstructed and recapitalised in May 2014, through a $3 million private placement. Since then Virax has changed its name to Prescient Therapeutics, tidied up its shares on issue through a one-for-20 share consolidation, and acquired two promising cancer compounds, both of which target the processes that allow tumours to survive and grow. Prescient could end 2015 with five active clinical trials investigating drugs with the potential to bring better outcomes for cancer patients around the world.

The $3 million raised in May allowed Prescient to buy Pathway Oncology, and its first-in-class anti-cancer drug GGTI 2418, in June 2014, for $500,000 (in shares). GGTI-2418 – now known as PTX-100 – came out of research at Yale University, which is now a large shareholder in Prescient. PTX holds an exclusive worldwide licence from Yale University for PTX-100 for the treatment of multiple myeloma, breast and pancreatic cancer.

Pre-clinical data has shown that PTX-100 can work in situations where tumours have become resistant to front-line chemotherapy drugs: breaking through that cellular resistance can allow the frontline drug to reinstate its ability to destroy tumour cells. Prescient expects to begin Phase 1b trials of PTX-100 in the first half of this year: a trial on multiple myeloma will be conducted at the Lee Moffitt Cancer Centre in Tampa, Florida, while a trial on breast cancer Phase 1b trial is being run at the Montefiore Centre in New York.

In December, Prescient bought US oncology company AKTivate Therapeutics and its novel cancer drug, TCN-P, for $1 million (in shares and cash). TCN-P – which has been re-named PTX-200 – is a small-molecule inhibitor of AKT (also known as protein kinase B), which is another key tumour growth pathway – it is the most frequently mutated pathway in cancer, and thus plays an important role in many cancers. AKT activation occurs very early in the development of cancers: it inhibits the process that normally instructs mutant cells to undergo apoptosis, or programmed cell death. PTX-200 prevents AKT sending the signal that inhibits the programmed cell death of the tumour.

The beauty of this pick-up is that PTX-200 is currently in two US government-funded Phase Ib/II trials, in breast and ovarian cancers: interim data from the breast cancer study is expected to be reported in the first half of this year, while a Phase Ib/II study of the compound in acute myeloid leukaemia – whose cancers have become resistant to the frontline drug Cytarabine – is also planned for the first half.

All up, this year PTX will have two novel and highly promising drugs, under two separate investigational new drug (IND) applications with the US Food & Drug Administration (FDA), in five clinical trials in patients with multiple forms of drug-resistant cancers.

The Pathway and AKTivate acquisitions have given Prescient good diversification, on top of its flagship platform technology asset, its Co-X-Gene anti-cancer technology, which has been licensed since 2007 to French biotechnology company Transgene, for use in its immuno-therapeutic products.

The strength of the technology was confirmed last year when Transgene delivered highly impressive results from a Phase 2B clinical trial of its TG4010 immuno-therapeutic product, using Co-X-Gene (with global drug giant Novartis participating through an option), in the treatment of Non-Small Cell Lung Cell Cancer.

Following this trial, global drug heavyweight Sanofi has begun working with Transgene on a manufacturing platform for the production of viral vectors, as utilised in TG4010.

Under the Transgene licence, Prescient is entitled to receive milestone payments and royalties from Transgene from programs and products that use the Co-X-Gene technology. Prescient is entitled to receive up to a further US$9 million in milestone payments.

Prescient’s planned clinical trial program gives the stock a lot of potential upside on the news flow, however, Prescient will need additional capital to fully fund its clinical trial program. Research firm Edison Investment Research estimates that it will require about $5 million to conduct the planned Phase Ib/IIa trials of PTX-100 in breast cancer and multiple myeloma and PTX-200 in acute myeloid leukaemia.

Edison also points out the potential dilution from 14 million shares to be paid on clinical milestones for PTX-100 and PTX-200. But the tiny market capitalisation of Prescient Therapeutics – at 11.5 cents, the market values the company at just $6 million – means that the potential leverage to good trial results is substantial. It seems clear that the stock market under-estimates the potential of both PTX-100 and PTX-200 – which may make the risk-reward profile of Prescient look worthwhile to investors who understand the high-stakes nature of biotech.

View More Articles By James Dunn

James was founding editor of Shares magazine, and oversaw one of the most successful magazine launches in Australia. He has also written for BRW, Personal Investor, The Age and Management Today, and was subsequently personal investment editor at The Australian and editor of financial website, investorweb.com.au



What are the current opportunities and key risks?

More video   


 › Australian Listed Real Estate Tables
 › Market At Midday On Monday
 › Self Diagnosing Using Google Might Not Just Be For Hypochondriacs
 › Listen To This!
 › Has Medicine Only Just Begun?
 › What's Your Coffee Telling You?
 › CCP - Morgans rates the stock as Upgrade to Add from Hold
 › TAH - Credit Suisse rates the stock as Outperform
 › MHJ - Macquarie rates the stock as Outperform
 › Stronger USD Keeps Heat On Gold, Metals
 › Oil Rallies As OPEC Confirms Modest Output Hikes
 › Shares In Countdown To June 30
 › Diary: Local Jobs, EU Summit, US Housing
 › ASX Outshines Wall St Over The Week
More ShareCafe   


Delivered free to your inbox before the market opens each trading day. Sign up below +