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Four biotech stocks to consider

By James Dunn
Wed 25 September 2019 04:57 PM Stocks to watch

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Biotech is a hugely interesting and potentially lucrative hunting ground for investors on the ASX but it comes with big caveats – the news flow in biotech stocks can giveth and taketh away, in nerve-racking falls and heart-pumping rises. The sector can potentially turn world-class research and biochemical discoveries into big dollars, and should be on the radar of any investor, in the speculative, high-risk area of the portfolio, where a small proportion of funds are put aside for an informed (hopefully!) punt that could pay off big-time. Here are 4 candidates – that all come with the standard warnings.

1. Biotron (BIT:ASX)

Market capitalisation: $42 million
One-year total return: 288.9%
In September-October last year, Sydney-based infectious diseases specialist Biotron showed just how speculative the biotech industry can be, when its shares rocketed from 2 cents to as high as 45 cents – a 2,150% surge – in just three weeks. The trigger was Biotron announcing that its flagship drug candidate, BIT225, was “having a unique effect in patients, over and above viral suppression seen with current anti-retroviral drugs” in patients suffering from HIV, in phase 2 trials.

With BIT225 showing potentially beneficial immunological changes not achieved in the current anti-retroviral treatment – which do not kill or cure HIV, but are used to prevent growth of the virus – the trial results grabbed world attention, not least because Biotron said at the time that the test results were “a major step to the ultimate goal of curing HIV-1 infection.”

The share price has eased from those heady days, but nothing much has changed: BIT225 is still in clinical development, the company sees a potential role for the drug in improving patient health outcomes “as well as in future HIV-1 eradication strategies,” and Biotron is talking all the time to potential development and commercialisation partners. In July, Biotron wrote to shareholders to remind them that the global drug development process takes its time.

Biotron also has a promising pre-clinical program for hepatitis B virus (HBV), as well as several earlier-stage programs designing drugs that target a class of virus protein known as viroporins, which play a major role in the virus life cycle of a very broad range of viruses, many of which have caused worldwide health issues such as Dengue, Ebola, Middle East Respiratory virus, Influenza and Zika viruses.

The return-to-earth of the Biotron share price could offer a welcome opportunity for investors to enter this highly promising story.

https://www.nabtrade.com.au/investor/insights/latest-news/news/2019/09/four_biotech_stocks

Could be the reason for sudden up tick.....