The coronavirus outbreak has hit global equities hard. Currently, it is difficult to identify a sectors which has not been impacted by this deadly disease. The spike in the numbers of coronavirus cases in US, South Korea, Iran and Italy have further increased the tensions all over the world. In the past few days, S&P/ASX 200 index went down by several points, majorly due to the coronavirus fears. Today, the index is down by around 60 point as at AEDT 3:30 PM.
Several health care stocks have reacted differently to coronavirus fears. Some have reduced their guidance while some has assured the market that their operations are not impacted by it. Lets take a look at few healthcare stocks and see how they reacted to coronavirus outbreak.
CLINUVEL Pharmaceuticals Limited (ASX: CUV)
In a response to several public queries, CLINUVEL Pharmaceuticals, a global biopharmaceutical company, has assured that neither the drug substance nor the excipients of SCENESSE® are affected by the coronavirus.
The company has confirmed that the supply chain and the manufacturing SCENESSE® has not been impacted by the outbreak of coronavirus. Despite of this assurance, CUV witnessed a downfall of 4.33% in its share price during today’s trading (as at AEDT 2:23 PM).
Based on the sourcing, manufacturing and controlled distribution in place for SCENESSE®, there are currently no consequences to CLINUVEL’s business operations within the European Economic Area or the United States which could be impacted by the COVID-19 outbreaks. The situation continues to be closely monitored.
The last half year results were driven by the growth from distributing SCENESSE® in European areas. More patients are receiving treatment for the first time and product supply has been expanded in those countries receiving SCENESSE® for up to the past four years where high patient retention operates approximate 95%. The company has implemented a uniform pricing policy in the European Economic Area whereby the price of SCENESSE® remained consistent between the two reporting periods.
Half year results highlights
- Net Profit result of $1.059 million, the eighth consecutive half year net profit result;
- Total Revenues of $9.971 million, up 11% compared to the same period 2018;
- Expenses up 54%, compared to the same period 2018, with investment in key areas of the business to allow the Company’s growing activities;
- As a result, net profit was 74% lower than in the half year ended December 2018;
- Balance Sheet remains strong, featuring nil Debt, Cash of $57.432m and Net Equity of $58 million; and
- Positive Earnings Per Share of $0.022.
As at 3:40 PM, CUV stock was trading $17.210 with a market cap of around $878.02 million.
Compumedics Limited (ASX: CMP)
Due to the impact of coronavirus on China’s sales, medical device company Compumedics Limited (ASX: CMP) has reduced its sales and EBITDA guidance to $40-42 million and $5.5-6.5 million, respectively.
In the last few weeks, the company has been in discussion with its key distributors in China regarding the impact of the Coronavirus and has understood that there has been a diversion of resources in the health/hospital sector to combat the spread of Coronavirus, and as a result, purchasing and funding has been reallocated temporarily. The Company expects the sales to China will slow in the second half of FY20 and as a result has adjusted its full year guidance.
The company has recently announced its financial results for the half-year ended 31 December 2019. For the period, the company reported revenues of $18.3 million, representing a 2% decrease over the previous corresponding period (pcp) of $18.7 million, impacted by some key US sales not being booked by 31 December 2019. Several of these sales have since been booked subsequent to 31 December 2019. Compumedics experienced growth during H1 FY20 in the Company’s key Asian markets and in Europe via the Company’s Germany-based business, DWL.
As at AEDT 3:39 PM, CMP stock was trading at a market price of $0.620, down by 8.824% intraday, with a market cap of around $120.47 million.
Biotron Limited (ASX: BIT)
Anti?viral drugs developer, Biotron has had a long interest in coronaviruses as Biotron scientists were the first to identify and characterise a protein found in all coronaviruses and have shown that, by targeting this protein, the virus could be inactivated.
Biotron has compounds that have shown very good activity against several different coronaviruses. These include common human coronaviruses that are one of the major causes of what people classify as ‘colds.’ Mild respiratory infections can cause serious problems in people with underlying health conditions. Biotron owns a family of compounds that certainly have future potential to be a ‘pan?respiratory’ treatment for that kind of infection.
In response to the recent coronavirus outbreak in China Biotron is now focused on testing a select set of these compounds against the new 2019-nCoV, and current is in the process of evaluating several promising compounds for activity against coronavirus.
The current interest in the new Covid?19 coronavirus does highlight that Biotron’s biotechnology platform represents a way to target a broad range of viruses – including the coronaviruses – and makes the company’s technology and its library of compounds more valuable than is generally understood.
Notably, in the last three months BIT stock has witnessed a upward jump of 106.9% on ASX. As at 3:40 PM, BIT stock was trading at a price of $0.140, up by 16.667% intraday, with a market cap of around $84.23 million.