t's been a while since I've done a comparison with another stock, tonight, lets take a look at another Aussie great and do a little side by side comparison with our PAR and the possible potential.
INTRODUCING PROMEDICUSKnown as an 'informatics' company
1, Promedicus (PME) is an Aussie company, their niche is imaging. But what they are really good at is loading images onto a device in slices as required. These days, images particularly MRI's and images captures from Tomosynthesis scans and others like CT scans take up a lot of room....a real lot of room.....I'm talking upwards of 3 Tb...yeah that's a lot...but that's not even representative of the latest MRI's that are capable of super detail, eg 7 Terabytes per image! it's a lot of space that's required, its a lot of bandwidth that you need to upload and download....who has the time to call these images up and wait around till they eventually load?
Enter Visage, well that's the name for their software capability to host these images in the cloud. For all you non IT savvyies...it just means to hold these images on external servers (repositories) and down load them super fast like, in segments and slices as required. The software is fancy...the revenue is too....yeah they charge a fair bit for the capability, per seat.
They achieve the speed and scalability by employing two servers that the images are uploaded to, a back end server and a rendering server. This then allows them to quickly be able to download the requested images straight to the radiographer's device with great speed.
The Promedicus architecture at high level...How does it benefit the end user? Well it frees up a stack of time. Paying these Radiologists and Docs to sit around waiting for their patient's images to load up isn't fun, and is time consuming - ie. not practical.
This Aussie company is churning out and expanding the software and the hospitals and labs are reaping the benefits and are paying good cash for the privilege. They are now present in 9 out of the top 20 hospitals in America. Just in the last 12 weeks alone they have signed two 7 year contracts with two separate hospitals, both contracts $20 M plus.
COMPARISONSo why am I telling you this? Because we can draw at least *some* parallels between what they experienced and what we may too....
M1, a mate of mine, bought a HC post to my attention...the post simply claims how this particular investor bought a few shares back when they were 78 cents.....today, they hit $70.
M1 to Mozzarc...take a read of this...But even that's not the full point I want to make...it's the following...
Guys, that move from around 78c to $70, was over just
9 years.
My point here is that this company has expanded this much and still has a long way to go...they have a good presence now in USA but a few months ago they only had one hospital in the whole of Germany...this thing is most likely poised to keep going (my thoughts)....the Mozz take away here is that PME has done spectacularly well....but the real point is, is that they are doing well in an industry where the barriers to entry certainly aren't too high. Another IT type cloud company could easily come and build up over time to compete with them though it may take considerable time and investment and PME already has an established presence out there in the industry.
The other point is this; what do they do? They take images and effectively break them down into piece meal bite sized images that can easily be viewed. Its a nice to have. But it's certainly not curing anything directly, it's not reliving any pain, well not directly. Its merely assisting in the
diagnosis.... As a comparator, what do we have?
What we have is
addressing a disease...it's not a nice to have...it is a
MUST have.
When a patient is in pain...they WILL do something about it.....and if they have a choice between:
Something that's safe, very safe
Something that gives potentially MULTIPLE benefits at the same time
Something that if it doesn't work and has NO benefit, its not going to have side effects or have any down side.
Something that lasts, that's durable
Versus
Not having the above...
The current std of care is so poor...you may get some pain relief but it's coming at a real cost...the cost of your health...specially longer term.
What I'm saying is that we haven't got any competition, there is no real alternative. Now add in not only the ability to arrest symptomatic observations like pain and poor function but, at least in a number of cases, it's going to halt and even reverse the course of the disease itself.
THE CHARTOk let's just take a look at their price action, we will do this in two parts...the first few years till 2014....and in the second chart we will look at pre and post 2014...:
PART 1 (2001 to 2014)
Single left click to enlarge if figs are on the small side...
Yes that's a flat line, and yes, it never got past $1.80, in all that time!
PART 2...the reveal, 2001 till today...
Doesn't this apply to us? Haven't we been flat lining or channelling or even been going down for literally years? Yes we get frustrated when we get pushed out again by a few months...but I for one understand how we aren't just delaying for the fun of it...or because the FDA are dragging their feet...or even because PAR are partly asleep on the job...
Asleep? Not PAR! As opposed to others, we are listening, oh we are so listening. We aren't arguing for the sake of it...we are complying and we are doing our very best to listen to the
teacherarbitrator authority! We are taking the next steps to not only present good data...but we are presenting undeniable, irrefutable data...data beyond belief (my opinions)...data that will be astounding and will shake the Pharma world. Yes the Big Pharmas are slow, they take time to do their own DD...they will take their own time to start really dig into us and while they are waiting for us to progress, there will definitely be a time when one of them will blink...when that happens, in my view, it will be the biggest frenetic auction behind the scenes that we simply do not hear about..it will just explode one day and we will get an announcement.
Who will blink first?TO BE FAIRI can't just say, hey, we are circa 70 cents and so if we follow PME's growth trajectory, we should be in the order of $70 in 9 years.
What makes more sense is to capture the Market Cap growth and compare...let's now do that,
Back 9 years ago, PME was all of $83 Million market cap...100 million odd shares circa $0.83 each....9 years later?
Still around the 100 million mark share count (104 to be precise) but the shares now trade at $70. There weren't any splits. There was a small buy back about a year ago but wasn't too significant
PME's market cap today stands at an impressive 7.3 Billion AUD.
9 years ago Market cap of 83 million...now 7.3 Billion, this represents a growth of 87.9 times!
Yummy.
Are you new to us? Just starting out? Maybe you don't have a lot of spare cash lying around? If this is you, be sure to have a read of Appendix A at the end of this post, it's written for someone just like YOU!
What I now say to you is that with a product that is a MUST have...a product that has a massive market, potentially...the same sort of growth is certainly NOT impossible. I could argue that we have a much higher probability, we have already de-risked so much. There is inherent de risking by the fact that our P2 is very similar to our P3 protocols. There is inherent de-risking by already having such parallel programs as SAS and EAP, clearly not only showing efficacy of our drug but an actual IMPROVEMENT over time. Compare the initial batches of SAS to the later ones for instance.
We are even further de risked by other indications with overlapping observations. Example?
Ok for this example we firstly need some background...let me put this in a separate section:
THE EXAMPLEIn March earlier this year, I had had the distinct pleasure to not only meet one of the world's leaders in OA research but I got a a couple of one on one sessions with her. Yes it was a pivotal moment for me where I could actually get to ask her some questions on OA. It was my Sir Isaac Newton moment...My Galileo...what are you talking about Mozz? My dad asked me a number of months ago, who is this Virginia Kruas....My dad is a retired Chem teacher, I said it is like you meeting Archimedes...she is the world leader on OA...with more than 650 papers published, I have a distinct feeling that it wont be the only opportunity I get, my fingers are crossed... More on that in a few months time.
Dr Virginia B Kraus is not only a world leader in this space but she's
ours....well I mean she is a consultant to PAR. If I want to try and win the world cup, I want some good players on my team...if I have to pay them for that privilege, then so be it, It will be worth it....oh will it be worth it (spec statement, not advice). (Well done to the Matilda's by the way...first time we have ever had such a high representation ie into the finals!).
Ok some background before we get to the background of the example!
OR's means Odds Ratio....this is a mathematical factor to determine whether a particular exposure is a risk factor for a particular outcome, If you have an OR of just 1, then the exposure does not at all affect the odds of outcome....have an OR of greater than 1 means you have a higher odds of outcome. If I say to you that a something has an OR of 1.1 ...you don't really have a good chance of it working out...bump this up to an OR of lets say 1.6....you have something like a 60% chance of it occurring
3.
So Dr V Kraus is charged with the responsibility of leading the Biomarker Consortium for OA by the FDA. In one of her many papers she stated that there were some "eight biomarkers that significantly predicted case status
4.
Specifically which biomarker do you think showed the single most prognostic inference?
"...the highest OR for any single biomarker predictor of case status was provided by 24 M TIC of uCTXII (OR 1.37, 95% CIs 1.15 to 1.65, p=0.0006)".Would you look at that above p value?
Here is another quote from the same paper:
"CTXII has been the only OA-related biomarker to achieve a ‘characterisation’ level of surrogacy"....and one more...
"These ORs indicate that for every 1 SD increase in uCTXII, the odds of progression increased 37% and 72%, respectively. These results suggest that differences on the order of 1 SD appear clinically meaningful for this biomarker. Studies to date suggest that uCTXII likely reflects both articular cartilage and calcified cartilage turnover".Paradigmers, what I'm trying to impress upon you is that you have a worsening CTX II levels in your urine compared to baseline, there is a great chance you have OA. Conversely, you start to reverse these levels and you are somehow halting, arresting or slowing down the course of the disease (Subject to clinical trial observations).
Wouldn't it be so nice if we got an indication of what our wonder drug iPPS does for CTX II levels ...
Guess we will have to wait for some future study yeah?
Ok ok I'm toying with you....Most have us have seen this one before:
I can't stop looking at this chart...it was derived from our 005 study way back in 2019....
The above chart excites me (yeah I gotta get out more ok) for several reasons:
1) P values great on
n of only 112, that was double blinded, well controlled study
2) The protocols for 005 are very similar to our 002
3) COMP and CTX II are very prognostic biomarkers, a lot has been said about COMP as well.
4) There is full diversion in the Active -v- Placebo, placebo continues to move in the opposite way and is indicating further destruction with the passage of time.
5) These results were sampled at Day 53, peak observation is back at, circa, day 39.
6) The change between CTXII in Active -v- Placebo cohorts are so stark...-25% against positive 17% odd....incredible.
But guys...what about some evidence that I suspect a number of you
haven't seen...or may have seen it in the past but haven't picked up on this most prognostic of OA biomarkers...what about the Chik_V study?
Here is a quote:
"The serum biomarkers COMP and CTX-II were reduced with PPS compared to placebo, indicating that PPS may inhibit the degenerative process in the joints"...and another...
"...urine C-terminal crosslinked telopeptide of type II collagen (CTX-II; p = 0.017) showed statistical significance in reduced levels with PPS compared to placebo"....but read this one....
"Urinary CTX-II levels were normalized to total urine creatinine concentrations".Guys, in our ChiK V study, CTX II levels not only merely reduced...they were NORMALSIED in terms of levels observed in the urine. Let me just state here for the record...there is no drug on earth that normalises CTX II. If you can find one that can do it SAFELY...you must write a reply to this post to that effect.
Dr Virginia B Kraus has a direct line into the FDA, so much so that the FDA have charged her and Dr Hunter with the task of leading the OA biomarker consortium...one day the FDA will know what we have (if they don't already)...yes they may be conservative, we have to factor that in....this isn't a drug that's just gonna be rolled out to a few hundred...a few thousand...I hope they understand and support us....if they do..it's not going to be terribly long before we get out of those flat lines on the SP. (My thoughts only)...yes it might still be months....but I don't see that it is years.
Yes we still need to have the all important FDA and EMA discussions, but the body of proof that PAR will submit here is quite extraordinary. The part I love is that it isn't just a concentric focus on only the wet biomarkers...I have a few engineers I'm talking to frequently, they are very impressed with the structural ramifications that have been demonstrated to date.
This bio structural manifestation, an altering in the course of the disease is not happening over
years of use of iPPS....it's occurring within just 6 months!! 26 weeks later after initialisation of a course of iPPS and the mean BML's in the lateral tibiofemoral compartment improved by a full 14%. that occurred in just a 6 week regime of iPPS, no more ongoing administration of the drug ...amazing when you consider it was an observation of the mean over just 6 months.
So what did placebo do? How much did placebo improve by? Was it something close? 10%? 5% perhaps?
They didn't improve.
Quite the contrary.
The went backwards...Did they go backwards by a slight amount?
Maybe 2% 5% ?? Was it just a few percentage points?
"Bone marrow lesions in the entire lateral tibiofemoral compartment decreased by an average 17% in the once-weekly iPPS arm, whereas increased by 56% in the placebo arm (p=0.028)" .Paradigmers, HC readers, friends...the placebo cohort as a mean deteriorated further by a whopping 56%...p value? It was significant, how many patients in the study arm? Hundreds?
It was 19.
We achieved a statistical significance in just 19 people.
This shows us the magnitude of the drug effect size.
This observation will, in my view, be supremely proven without doubt in a larger cohort. Watch this space.
Maybe you can factor your own dilution here, maybe you can factor a more conservative growth model. Maybe you can say that meaningful revenue wont start for us until at least 2026.
To counter some of the dilution, some of the conservatism, you cant forget that OA is growing at circa 8%. But you also need to factor, albeit in the later years eg maybe from years 5+, other indications...yeah I'm talking Pain in general...I'm talking Blood Pressure...Hay Fever even...these indications will add layers of revenue for us. If you want another step up, what about step up in royalty as a further accelerant.
I wish I was ten years younger but I still think and hope I will catch a very good bulk of the extreme aggressive growth...from year to year...my little brain cant even phantom what years 5 to 10 would be like...We are going to see green days that totally encompass our entire share price today...ie $1 movement up in a single session...my speculative thoughts.
If I start the clock at 2026 and say it takes just as long to grow as PME. That's 2035 that we might just find ourselves at circa $70 or better. I have this feeling that once our drug is licensed and we really start selling...that word of mouth is going to push us a real long way and in a much quicker fashion....it's not going to take us the same full 9 years to achieve this level of growth when we are addressing something as important as pain....function...and the vast realm of inflammation.
DYOR important
APPENDIX AI sometimes read in a an investment book the What IF's - What if you had invested $1000 back in 1960 in Berkshire Hathway...it would be worth well over $100,000,000 now. Yes there are some strong buts and ifs...you'd have to hold it for that long, you'd have to ride out the dips and the highs...but what I wanted to show you tonight is one example, a practical example...something you could deploy today...well Monday when the market opens (not advice).
Dreaming of those what if's ??So remember, I'm not a qualified investment adviser....none of this is advice, its just an example. There can be many things that can go wrong, you need to be wary of these before you invest in anything!
I personally believe we are very de-risked...we have a great product, it works! It really works....there is no competition, we will, if we pass these trials and studies, be first in class...we will be a DMOAD drug for many! Yes it could be a long journey still, yes we are supremely reliant on Management and we do and will have capital needs, I'm not saying that there are NO risks...there are risks, they are real, we need to keep a dedicated watch on these.... and yet despite being at P3 stage...we are under $1.00 AUD !
So the way this table below works is that you start off with a somewhat modest investment, in this case $9000 (90 cents x 10,000 shares as an example)...if we find ourselves in the fortunate situation of a trajectory not unlike Promedicus (Remember, just because they went up doesn't mean we WILL!)...in the below example I have exit triggers at every round $10....I sell exactly 1000 shares each time...just look at how it adds up and the best thing is that at some point we should also reap in dividends...I've gone fairly conservative at 1% to start with but I step it up to 2% at $40 and finally 3% at $70..
Don't forget, there are two examples I can point to where this sort of crazy acceleration actually happened, obviously PME, but it also happened to Sirtex ($7 to $41 in 18 months!) and I'm sure a lot of you could facilitate other examples too....
The other good thing about the below even though it is just a hypothetical example I made up, after $70, you still have 3000 shares left...doesn't sound like a lot but at $70..they are worth a further $210,000 plus they should attract a 3% dividend (around $6000 a year!) Not too shabby from a $9000 investment.
Of course DYOR and realise this is just an example, a number of things have to go right for this to play out like this.
REFERENCES1] https://www.promed.com.au/investors/#:~:text=Pro%20Medicus%20is%20a%20leading%20healthcare%20informatics%20company.&text=The%20company%20offers%20a%20leading,Melbourne%2C%20Berlin%20and%20San%20Diego.
2] https://www.marketscreener.com/quote/stock/PRO-MEDICUS-LIMITED-6492507/news/Pro-Medicus-Starts-Share-Buyback-Program-43410551/
3] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2938757/#:~:text=The%20odds%20ratio%20can%20also,with%20higher%20odds%20of%20outcome
4]
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5851287/5]
https://app.sharelinktechnologies.com/announcement/asx/63a249bdb0b4e5e1dc93c8ee2644f3a26]
https://www.promed.com.au//wp-content/uploads/2013/10/Annual-Report-20143.pdf
(20min delay)