Antimicrobial product manufacturers favourably impacted by COVID-19 - ZNO, HCT

Novel Coronavirus (SARS- CoV-2) has reportedly infected a total of 75,465 individuals with the death toll soaring to 2,236 as per the National Health Commission. Main routes for virus transmission include spread via respiratory droplets and contact with infected patients. However, considering its strong and fast transmission speed, there could be other ways of spreading virus infection, as per the Chinese Center for Disease Control and Prevention (China CDC).

A new research has suggested fecal transmission of this deadly virus which might explain its rapid spread. Previous tests revealed that the coronavirus could be present in feces. However, it was unclear if the virus would be viable enough to circulate to another person. Recently, live virus particles have been found by researchers in stool specimens, indicating a fecal-oral path for coronavirus.

This might be the cause of COVID-19 on the Japanese cruise ship, with over 600 COVID-19 confirmed infections amongst travellers & the cruise staff on board the Diamond Princess, the ship quarantined in Yokohama, Japan along with two recently confirmed death officially reported.

In view of this, bolstering sanitation and hygiene methods to prevent fecal-oral spread in the areas affected by the epidemic is recommended, including frequent handwashing, and using disinfectants.

The given pandemic has encouraged the development of novel coronavirus vaccines throughout the biotech industry, both by pharmaceutical companies as well as research organisations including the National Institutes of Health (NIH). US-based companies including Inovio Pharmaceuticals, Novavax, and Moderna have reportedly been involved in developing coronavirus vaccines. Moreover, a few Australian companies have also joined the bandwagon including CSL, Biotron Healthcare, Zoono Group, Holista Colltech Limited that have ramped up their respective efforts to contribute to the cause.

It is worth noting that recently, in an essential step towards developing vaccines and antiviral drugs against the virus, the coronavirus SARS-CoV-2 spike protein has been mapped in 3D at an atomic scale using cryo-electron microscopy.

In this article, we will be discussing two ASX-Listed antimicrobials manufacturers that might benefit from COVID-19. Let’s zoom into the details.

Zoono Group (ASX:ZNO)

Zoono Group is engaged in the development, manufacturing and distribution of long-lasting & environmentally friendly and scientifically proven antimicrobial solutions, including hand and surface sanitisers that have been proven effective against the coronavirus family. Zoono is one of the few biotech stocks seemingly benefitting from COVID-19, with its shares surging dramatically and deals cracking up quickly.

The company believes that it is well placed to present solutions to both coronavirus and other new-found virus threats with its surface and hand sanitiser products. Zoono believes that both the products could be useful in tackling coronavirus transmission.

Zoono Executes Distribution Agreement with Eagle for China Territory

In an announcement dated 20 February 2020, Zoono highlighted that it had entered into a Distribution Agreement with Eagle Health Holdings Limited (ASX:EHH) to distribute Zoono’s products in China.

It is a “co-branding” arrangement between the two companies wherein the bulk import of Zoono’s formulations to its wholly-owned GMP certified pharmaceutical facility in Xiamen China would be arranged by Eagle. It was further revealed that Eagle would carry out the labelling, packaging and distribution into its extensive existing channels. Across China, there are more than three hundred Zhang Lao San exclusive product stores & franchised stores, and an additional 271 distribution partners. Eagle’s branded products are placed into circa 30,000 stores throughout the country.

Amid COVID-19 outbreak, there appears to be an extraordinary interest in Zoono Technology driven by its demonstrated activity in combating ‘corona type’ viruses & bacteria, plus its ability to counteract cross-contamination with its 24 hours to 30-day extended efficacy (by application).

In order to facilitate the packaging and distribution of Zoono products, Eagle is getting faster co-operation from Xiamen’s local government agencies for expanding GMP pharmaceutical facilities and registrations.

Various departments of the Chinese government are putting a high priority on helping companies with products and services coupled with preventing and regulating the spread of the Coronavirus.

Given this, along with the latest discussion with the local authorities, Eagle anticipates the appropriate licenses would be conferred to the Xiamen facility upon accomplishment of inspection in the future. The first consignment of nearly four tonnes of Zoono’s product is being prepared for urgent air freight and transport to Eagle’s Xiamen facility.

Zoono Reported NZ$3.5 million in Sales Revenues in the Present Quarter

As a response to the unprecedented level of interest in Zoono and its products, the company advised that the unaudited revenues for the current quarter (seven weeks only) amount to NZ$3.5 million. This equates positively to NZ$1.715 million revenues for the entire first half of FY2020. The Company also reported-

• NZ$4.0 million cash reserves
• Online sales of NZ$30,000 to NZ$50,000 per day on an average.
• Increased percentage of gross margins

Stock Information

Zoono’s shares have generated a return of more than 766% in the last three months and around 291% in the past one month. Zoono’s stock has been steadily rising since December 2019 and surging since last one week reaching 25% higher on 17 February 2020. On 21 February 2020, Zoono settled the day’s trade at $1.675, down 7.96%.

Holista Colltech Limited (ASX:HCT)

Holista Colltech Limited is a Perth-headquartered, research-driven biotech company with extensive operations in Malaysia, that seems to have gained in the wake of the virus outbreak. Holista is engaged in delivering high class organic ingredients as well as wellness products worldwide.

Holista Collaborates with Global Infection Control Consultants LLC to co-develop nasal sanitizing balm for global markets

On 20 February 2020, Holista announced that in partnership with Control Consultants LLC, it would co-develop and produce the world’s first nasal sanitising balm using Path-Away® in Malaysia.

Source: Company Presentation

Path-Away®, which was developed by GICC LLC, has been tested and proven to destroy more than one hundred and seventy pathogens (including viruses, bacteria, and fungi), and kills AIDS virus as well as the resilient Mycobacterium tuberculosis. Path-Away® attaches to the surface of the virus and weakens the cell walls by impeding its ability to take up amino acids, forcing the virus cells to cluster together, in the course of killing themselves, almost immediately.

Ministry of Health, Malaysia has approved Path-Away® as being effective against the H1N1 virus.

A global patent on the nasal sanitising balm is anticipated to be jointly filled in Q1 FY2020 by the two companies. The production is expected to begin by the Q3 FY2020, in advance of distribution to global markets.

Update on Hand-Held Sanitizer; Holista’s Partnership with Bottlers in the Philippines

Path-Away® containing hand-held NatShield™ Sanitiser, developed by Holista, is presently being bottled in Malaysia and distributed within the ten-country ASEAN region. The company informed that in local pharmacies the stocks have run out and Holista is working with three bottlers in the Philippines to address the demand.

Moreover, GICC LLC has granted Holista the distribution and marketing rights for Path-Away®, focusing on the nasal sanitising balm and hand-held NatShield™ Sanitiser beyond the ASEAN regions to include the UK and Europe. GICC LLC will work in collaboration with Holista in the North American market for promoting the NatShield™ Sanitiser and Nasal Sanitising Balm.

Update on Funding

Holista has successfully secured over $2.6 million since the start of 2020 to develop the nasal sanitising balm and expanding distribution to new international markets by growing its existing regional markets as well as new European markets without disrupting business operations.

Stock Information

Holista’s shares have generated a return of more than 187% in the last three months and around 150% in the past one month. Holista’s stock has been steadily rising since January 2020 and surging since last one week reaching 51% higher on 18 February 2020. On 21 February 2020, Holista settled the day’s trade at $0.195, up 2.63%.

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