Stabilised and primed to go higher, page-48

Bell Potter Research note

HEALTHCARE

Oncosil Medical (OSL)

CE Mark Likely 1QCY2020

·Years of work are now coming to a head for Oncosil with the likely imminent granting of the CE Mark for Oncosil therapy. During the course of the December quarter the British Standards Institute closed out all remaining clinical concerns. The company has since presented its Post Market Surveillance plan and Post Market Clinical Follow up both of which we understand were acceptable to the regulator. The essential component of these plans includes (but is not limited to) a register to monitor the long term progress of all patients receiving Oncosil therapy. The data emerging from the register will be owned by the company and may be used to support future marketing activities across all jurisdictions. The submission of the post market surveillance plan is normally a reliable indicator of a forthcoming approval.

·We have previously estimated up to 85,000 new cases of pancreatic cancer annually in Europe with approximately 85% of these advanced and therefore inoperable at the time of diagnosis. The standard of care is a chemotherapy regime which delivers on average overall survival (OS) of 8.5 months with only 7-11% of cases down staged such that surgical cure becomes an option. In comparison OS in the per protocol group in the Panco study was at least 16 months with many of these patients undergoing curative surgery and still alive. The resection rate in the Panco trial was approximately 24%.

·If the CE Mark is awarded, we believe it will represent the most significant event in the treatment of pancreatic cancer since the approval of the combination of Gemzar + Abraxane in 2013. Based on these survival benefits we believe the treatment regime for Oncosil will be well supported by physicians in the UK and major markets in Europe, Australia and throughout Asia (pending subsequent approvals in each country). Cash reserves at 31 December were $6.8m. Our forecast and valuation includes the dilutionary effect of a likely capital raise following the CE Mark.

Buy Maintained, Valuation $0.30

·No changes to earnings forecasts and we maintain our Buy (Speculative) rating.

.19

.30

1		Recommendation:	Buy (Spec)	Previous Close:
2	Recommendation:	Buy (Spec)	Previous Close:	$0.19	Valuation:	$0.30
Valuation:
3	Recommendation:	Buy (Spec)	Previous Close:	$0.19	Valuation:	$0.30