Stock Price of Opthea Limited Surges over 20% in January 2020. What do Investors Need to Know?

  • Jan 29, 2020 AEDT
  • Team Kalkine
Stock Price of Opthea Limited Surges over 20% in January 2020. What do Investors Need to Know?

The stock of Opthea Limited (ASX:OPT), a clinical-stage biopharmaceutical company, closed at a price of $3.600 on Tuesday, 28 January 2020 and has been gaining investors’ attention with its performance since the beginning of 2020.

The same stock had closed at a price of $2.980 on 31 December 2019 and has increased by around 20% till its last close on 28 January 2020.

The stock has a market capitalisation of $968.97 million, little shy from the 1 billion market cap mark.

During the period of last one month, the stock has increased by 15.76% and had inched closer to its 52-weeks high price of $4.150.

Since the beginning of the past year (2 January 2019) till 2 August 2019, the OPT stock had delivered 51.75%; however, during the latter part of the year, from 2 August 2019 till 31 December 2019, the stock had increased by 244.5%.

Source: ASX

During the month of August 2019 alone, the OPT stock witnessed a surge of 308.5% rising from $0.820 on 1 August 2019 to $3.350 on 30 August 2019.

The stock has been making news among the investors due to recent upsurge in its value within the time period of less than a month, filling investors’ pockets with fair amount of capital gains.

Being a biologics drug developer, Opthea Limited engages in developing innovative biologic therapies to treat eye diseases with its commitment to enhancing vision in patients who are suffering from retinal eye diseases.

For evaluating the safety and efficacy of OPT-302, the company had recently concluded the recruitment of patient into its Phase 2a trial which shall be administered along with aflibercept (Eylea®) for treatment of diabetic macular edema (DME).

Post recruitment for the Phase 2a DME study, the company management is now focused on:

  • Corporate activities to progress OPT-302 into Phase 3 studies for wet AMD;
  • Preparing to report top-line data from the Phase 2a DME trial in the second quarter of the calendar year 2020 (following the completion of patient dosing, study visits, data collection and statistical analyses);

The company is optimistic about the potential for OPT-302 in DME, given the

  • Positive outcomes of our Phase 2b wet AMD study; and
  • Previous positive Phase 1b clinical results which showed dose escalation of OPT-302 combination therapy was well tolerated with improved visual and anatomic outcomes in patients with treatment-resistant and persistent DMEs;

Further evaluation of the OPT-302 combination therapy in a larger patient population is being conducted currently under the ongoing Phase 2a DME study to confirm the above-mentioned observations.

Intellectual Property

Based on an extensive intellectual property portfolio, Opthea’s development activities encompass key targets (Vascular Endothelial Growth Factors VEGF-C, VEGF-D and VEGF Receptor-3) for the treatment of diseases associated with blood (angiogenesis a) as well as lymphatic vessel growth (lymphangiogenesis), and vascular leakage.

Opthea’s product development programs are focused on developing OPT-302 for retinal diseases and its wholly owned subsidiary Vegenics Pty Ltd. Holds its intellectual property. Being a biologics drug developing company converging on ophthalmic disease therapies, OPT commands complete worldwide rights to a major intellectual property portfolio around VEGF-C, VEGF-D and VEGFR-3.

  • Opthea owns a patent family covering the OPT -302 molecule, and usages thereof, extending out to February 2034.;
  • This patent has been filed in 19 countries and is already granted in the United States, Australia, South Africa, Singapore, Colombia and Japan;
  • The US patent, which was granted in August 2017, includes broad claims to the OPT-302 molecule, and analogues thereof, and their use to treat disorders involving neovascularisation, including eye diseases such as wet AMD and DME;
  • Opthea has two further granted patents relating to soluble VEGFR-3 molecules in the US;
  • The first includes the composition of matter claims to soluble VEGFR-3 molecules (such as OPT-302) and extends out to November 2026;
  • The second covers the generic use of soluble VEGFR-3 molecules (such as OPT-302) to inhibit the growth of VEGFR-3 expressing blood vessels in mammalian diseases and extends out to September 2023;

Over the years, Opthea has continued to raise the profile of the company’s technology to global as well as local investment community by regularly presenting and meeting with global institutional and retail investors through investor forums and meetings.

Let us take a look at company’s financial performance during the past year,

Financial Performance

  • Consolidated cash balances as at 30 June 2019 amounted to $21,534,919 (2018: $32,510,230);
  • Receivables of $14,932,759 (2018: $12,410,980) include the Opthea Group’s expected refund of R&D tax incentives for the year to June 2019 of $14,636,973 (2018: $12,017,248);
  • The Group has a net current asset surplus of $30,376,200 (2018: $37,349,456);
  • The net tangible asset backing per share as at 30 June 2019 was $0.12 (2018: $0.19); Opthea’s share price was $0.67 (2018: $0.53);
  • The consolidated net loss of the Group for the year was $20,910,061 after an income tax benefit of $14,636,973 (2018: loss of $16,902,240 after an income tax benefit of $12,017,248);
  • Direct R&D expenditure amounted to $31,347,891 (2018: $24,891,534); including personnel costs and other R&D support costs which are included in administrative costs,
  • Total expenditure in R&D amounted to $33,679,391 (2018: $27,111,137);
  • The major expenditure of the Group has been in relation to R&D, in particular costs associated with the Phase 2b and Phase1b/2a clinical trials of OPT -302 for wet AMD and DME and sourcing of standard of care anti-VEGF-A agents (eg. Ranibizumab) used in the clinical studies;

Opthea continues to advance the clinical development of OPT-302 to achieve key commercial milestones and has either completed or is in the process of completion of the following key objectives of the company during the year FY20:

  • Prepare and complete the Phase 2b wet AMD clinical study report;
  • Publish outcomes of the Phase 2b wet AMD trial in a peer-reviewed journal; and
  • Develop plans to take OPT-302 for the treatment of wet AMD to the next stage of its clinical development;
  • Complete patient enrolment in the US, Australia, Israel and Latvia for the Phase 2a clinical trial in DME patients;
  • Complete the 3-month dosing regimen in patients enrolled in the Phase 2a DME clinical trial and complete close-out activities for the trial to facilitate primary data analysis and reporting of outcomes;
  • Ensure the global investment and pharmaceutical/ biotechnology community is aware of the commercial potential inherent in OPT-302;

Moreover, the company looks forward to preparing and strategically placing Opthea for various and all opportunities to advance further development of OPT-302 through investment out-reach and engagement with pharmaceutical/biotechnology companies in the sectors, with a view to optimising shareholder value.

At the market close on 29 January 2020, the OPT stock was quoted at a price of $ 3.500, down by 2.778%, with a daily volume of 218,583.

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