COVID-19 vaccines have reached Australia but ASX stocks that were making anti-COVID 19 drugs or tests are pushing on.
The outbreak of the pandemic caused a number of ASX companies (big and small) to pivot to fighting COVID-19.
In the last few months the discovery and rollout of vaccines have given hope we are at the beginning of the end of the pandemic.
You might think this would be bad news for stocks working on drugs if the world put all its eggs in the one vaccine basket – but they’re all still pushing on.
But some have said that even if COVID-19 magically disappears, their work will not have been in vain.
Treatments will ‘coexist’ with vaccines
One of these stocks is PharmAust (ASX:PAA). It has traditionally focused on cancers but has put its monepantel drug to the test against COVID-19.
After positive pre-clinical results in Australia, it has partnered with Leiden University in the Netherlands for suitability for human testing.
The company last updated shareholders a fortnight ago noting testing was continuing despite COVID-19 restrictions and shareholders would be updated once results came to hand.
Its boss Roger Aston thinks vaccines won’t mean its efforts will have been for nothing.
“We think products such as MPL will happily co-exist with vaccines,” Dr Aston told Stockhead yesterday.
“It is hard to tell where COVID-19 is going, particularly with new variants appearing in different parts of the world. Also, as an anti-viral MPL might potentially find a home in other viral diseases such as HIV/AIDS.”
Another stock is Dimerix (ASX:DXB), which has traditionally targeted kidney disease. Its shares took off in June after its DXB-200 drug was chosen for a global program against ARDS and it launched a Phase III trial.
Dimerix told shareholders in a recent company presentation it could receive Emergency Use approval from the FDA in the middle of this year.
It also said the opportunity extended beyond COVID-19 in that it could assist with respiratory complications associated with other infections such as pneumonia and influenza.
COVID-19 tests will still be needed
Stocks that you might expect to suffer if COVID-19 becomes less of a problem are test kit makers such as Genetic Signatures (ASX:GSS) and Atomo Diagnostics (ASX:AT1).
The latter of these companies was one of only a handful of IPOs at the peak of COVID-19 restrictions and also pivoted into the space – having begun its life specialising in HIV/AIDs kits.
Atomo’s CEO John Kelly told Stockhead last year, that while his company had other businesses, a vaccine wouldn’t mean the automatic end of the need for COVID-19 testing.
Furthermore, even if COVID vaccines were the magic bullet to end the pandemic, it would take some time to roll them all out.
“The roll out itself across 7 billion people is going to take a couple of years and I think people will need to be tested not just prior to that but through that process,” he said.
Genetic Signatures also makes test kits for other diseases, but COVID-19 has undoubtedly been a windfall.
Other stocks fighting COVID-19
Easily the largest and most prominent stock working on a COVID-19 treatment was stem cell company Mesoblast (ASX:MSB).
It is almost at parity with its share price 12 months ago but has been on a rollercoaster ride thanks to varying advances and setbacks in its endeavours against various diseases.
The company put its remestemcel-L infusion to the test against severe acute respiratory distress syndrome (ARDS) – at one point in the pandemic the most common cause of COVID-19 deaths.
Shares first rose in April after a small trial on a dozen COVID-19 patients performed well and ever since it has been performing a larger trial.
The last update on its ARDS trial came from its January quarterly. Mesoblast is anticipating 60-day results to become available this quarter.
One further COVID-19 related trial Mesoblast is undertaking, albeit less prominent, has been against multi-system inflammatory syndrome (MIS-C), a disease associated with prior COVID-19 infections that occurs in children.
The company saw positive results in the first two children it treated and last week a paper was published on these results.
Mesoblast’s fellow stem cell play Cynata Therapeutics (ASX:CYP) is another ASX candidate fighting ARDS.
It is recruiting for a clinical trial in Australia to investigate early efficacy of Cynata’s Cymerus stem cell platform against ARDs.
Incannex Healthcare (ASX:IHL) is another ARDS fighter, although its therapy is different – combining cannabidiol and hydroxychloroquine (IHL-675A).
The company has notched up solid pre-clinical results on rats and in-vitro (in tube) studies. It is currently seeking Investigational New Drug approval to conduct a Phase II clinical trial, after which it would seek emergency use authorisation from the FDA.
At Stockhead, we tell it like it is. While Dimerix and Incannex are Stockhead advertisers, they did not sponsor this article.
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