Health Care Stocks In Red Zone Today: Mayne, PolyNovo, Nanosonics

  • Nov 25, 2019 AEDT
  • Team Kalkine
Health Care Stocks In Red Zone Today: Mayne, PolyNovo, Nanosonics

Health care sector is one of the most significant contributors to the Australian economy, known for delivering best services by advancing technology.

Health care sector comprises of providers of medical services, medical insurance, and medical equipment, as well as companies dealing in drug development and research and development activities. In this article, we are discussing three health care stocks listed on ASX- Mayne Pharma Group Limited (ASX: MYX), PolyNovo Limited (ASX: PNV) and Nanosonics Limited (ASX: NAN). Let us have a look at their recent clinical and other operational developments.

Mayne Pharma Group Limited (ASX: MYX)
Stock Performance on 25 November

The MYX stock was trading at $0.465, down by 4.124%, on 25 November 2019 (AEST 02:49 PM). The market cap of the company stood at $813.09 million with a 52 weeks high price of $1.105 and a low price of $0.430. The stock has delivered a negative return of 17.09% in the last six month and 15.65% in the past one month.

About the Company

South Australia headquartered health care company, Mayne Pharma Group Limited (ASX: MYX) is focused on applying its drug delivery specialisation to commercialise branded as well as generic pharmaceuticals. Additionally, the company offers manufacturing services to over hundred clients across the globe.

Mayne Pharma has its distribution partners across the world majorly in Australia, Europe, Asia and North America. The company has expertise in formulating complex oral dose forms which include controlled substances, modified release products and potent pharmaceutical compounds, with two product development units based in Australia (Salisbury) and North Carolina (Greenville).

The company offers analytical testing services for method development & validation, raw materials testing, trace metals testing, and microbiology and stability studies & storage.

AGM Presentation Update

Recently, the company updated the market with its Annual General Meeting presentation, discussing the overview of MYX and financial performance during the year ended 30 June 2019.

  • Reported sales stood at $525.2 million for FY2019, down 1% year on year.
  • Mayne’s reported EBITDA for FY2019 was $111.6 million and underlying EBITDA stood at $130.9 million.
  • The company reported a net loss after tax of $(280.8) million, driven by asset impairments.
  • Reported positive operating cash flow of Mayne Pharma Group stood at $106.6 million.

AGM Presentation Update

TOLSURA® - New Infectious Disease Platform

TOLSURA® is an oral formulation of itraconazole. The formulation, targeted towards the treatment of patients with systemic fungal infections, was approved by the FDA in December 2018 and launched in the US market in January 2019.

  • The company is targeting 25% itraconazole US prescription market share by the end of the fiscal year 2022.
  • TOLSURA® is listed on 6 IDN / hospital networks and represents 11% of institutional itraconazole market volume.
  • Mayne is planning to broaden the therapeutic use of TOLSURA® through further clinical programs.

New Infectious Disease Platform

Oral Contraceptive (E4/DRSP) Overview
  • The company has 20 years of license (exclusive) and supply agreement for E4/DRSP in the United States.
  • Mayne conducted two phase 3 clinical trial studies, held in more than 3,700 patients and unveiling positive outcomes.
  • The company is expecting the launch in 1HCY21, depending on the FDA approval.
Outlook
  • The performance of generic products would depend on various factors, which include FDA approval timings, competitor launches and key product withdrawals.
  • After the launch of TOLSURA® and LEXETTE®, and E4/DRSP, in the fiscal year 2022, the company is expecting specialty brands to benefit.
  • The company is expecting group operating expenses to be lower in the fiscal year 2020 as compared to FY2019 (on a constant currency basis).
PolyNovo Limited (ASX: PNV)
Stock Performance on 25 November

The PNV stock was trading at $1.785 on 25 November 2019 (AEST 02:58 PM), down by 6.789%. The market capitalisation of the company was $1.27 billion, with approx. 661.09 million outstanding shares. The company has delivered a negative return of 22.78% in the last one month.

About the Company

Australia-based medical devices provider, PolyNovo Limited (ASX: PNV) offers dermal regeneration solutions by using NovoSorb- a patented bio-resorbable polymer technology. The company is into manufacturing and developing medical devices and implants. PNV’s first product NovoSorb BTM is a dermal matrix facilitating repair in dermal skin and is available in the United States, South Africa, New Zealand and Israel. PolyNovo has a total of 47 patents granted (in the family), and all the patents are owned 100% by the company.

Investor Presentation Highlights

PolyNovo presented to its investors in New York and discussed an overview of its business expansion activities and near-term investments. The highlights of FY2019 (ended 30 June 2019) according to investors presentation were

  • The company generated revenue of $9.3 million from the sales of NovoSorb BTM.
  • Cash on hand of the company for FY2019 was $13.9 million.
  • PolyNovo reported a decrease of 51% in net cash outflow from operating activities.
  • The company purchased a new property due to high production demand as a result of the increased sale.
  • PolyNovo received new regulatory approvals in Malaysia, India and Singapore.
  • PNV has completed its CE Burn trial and would publish results by the end of Feb/March 2020.
Strategy for Fiscal Year 2020
  • The company is planning to expand the sales of BTM in Australia, United States and New Zealand.
  • PolyNovo has a well-planned product pipeline in breast and hernia.
  • The company is continuously increasing its manufacturing capacity for hernia production.
  • PolyNovo would file for Hernia US FDA 510(K) at the end of 2020.
Nanosonics Limited (ASX: NAN)
Stock Performance on 25 November

The NAN stock was trading at 6.745% on 25 November 2019 (AEST 03:02 PM), down 2.529%, with a market capitalisation of $2.08 billion. The stock has delivered a positive return of 38.21% in the last three months and 0.87% in the last one month. The NAN stock has a P/E ratio of 152.420x.

About the Company

ASX listed health care payer, Nanosonics Limited (ASX: NAN) provides solutions for the safety of patients, clinics and the environment by preventing infection with its innovative technologies. The company, which is engaged in the R&D and commercialisation of infection control, offers Trophon products, which deliver the world’s leading automated HLD solution ultrasound probes.

2019 AGM Highlights
  • Nanosonics Japan K.K., the Japanese entity of NAN, was established in FY2019.
  • Nanosonics completed its clinical study, more than 90% of probes were contaminated. Of the contaminated probes, >50% had potentially pathogenic bacteria including methicillin-resistant Staphylococcus aureus (MRSA).
  • Nanosonics received regulatory approval for its product trophon2.
  • The company signed deals with many distribution partners, including GE Healthcare Japan.
  • Its investments are expected to increase by 32% to $15 million in research & development in the fiscal year 2020.
  • The company continues to target the first significant new product for an international launch in the financial year 2021.
Outlook for FY2020 and Beyond
  • Nanosonics would focus on boosting the installed base in North America during the fiscal year 2020.
  • The company is expecting increased investment in growth with operating expenses expected to reach nearly $67 million including ~$15 million in R&D.
  • The company is planning increase in the upgrades of trophon EPR to trophon 2.
  • For Trophon, Japan could become an important growth market.
  • The company is planning to expand the product portfolio internationally and continue investing in research & development to build new potential product pipeline.

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