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Recce share price on watch following COVID-19 antiviral selection

Daryl Mather | July 9, 2020 9:52am

Image source: Getty Images

The Recce Pharmaceuticals Ltd (ASX: RCE) share price is on watch today after the company announced it has entered into an antiviral Sars-CoV-2 screening program. Recce (pronounced ‘recky’) is pioneering a new class of synthetic antibiotics to overcome the urgent global health threat posed by drug-resistant superbugs and secondary bacterial infections associated with viruses such as COVID-19.

These antibiotics are called bactericidal. Therefore, they kill bacteria instead of inhibiting their growth. Consequently, they can still be effective even with repeated use.

Recce’s intellectual property portfolio consists of 30 issued patents and patent applications. These span the world’s major markets including the United States, Europe, Japan, China and Australia.

Why is the Recce share price on watch?

Following a trading halt that began on Monday afternoon, yesterday Recce announced it has entered into an antiviral SARS-CoV-2 screening program agreement. The agreement is with The Commonwealth Scientific and Industrial Research Organisation (CSIRO) and the University of Melbourne at The Peter Doherty Institute for Infection and Immunology (Doherty Institute).

Two of Recce’s compounds were selected in the Priority 1 candidate group for the SARS-CoV-2 antiviral screening program. To clarify, for those of us without medical doctorates, SARS-CoV-2 is the virus that leads to the COVID-19 disease.

A panel of scientific experts in virology, antivirals, and medicinal chemistry assessed submissions, in addition to clinical trials. Moreover, only compounds with the highest likelihood of antiviral or antiseptic impact received Priority 1 status. This means they are eligible for stage 1 laboratory screening trials.

The two compounds selected are RECCE® 327 and RECCE® 529. The Program is part of the Australian Government’s efforts to identify promising anti-viral candidates and fast-track research into potential treatments for COVID-19. The antiviral focus of the compounds may also see potential benefit against secondary bacterial infections.

Management comments

Dr. John Prendergast, Recce Pharmaceuticals Non-Executive Chairman said, “We are very pleased to have been selected by the CSIRO, one of the largest and most diverse scientific research organisations in the world, to investigate the efficacy of two of our promising compounds against SARS-CoV-2. The compounds’ unique, universal mechanisms of action indicate potential to attack a broad range of viruses and as well, overcome the threat of viruses’ typical hyper-mutation into new and deadly pathogens.”

Recce share price

The company’s primary focus for its RECCE® 327 compound has been to address the unmet need for an effective treatment for sepsis. Sepsis is a life-threatening, inflammatory response to infection that has spread in the body.

To illustrate the size of Recce’s potential addressable market, sepsis kills more people in the US than prostate cancer, breast cancer and HIV/AIDS combined. According to the company, there have been 48.9 million reported cases of sepsis and 11 million associated deaths worldwide.

The Recce share price has increased 100% year to date and closed at 68 cents on Monday before the pause in trading. This values the company at $92.53 million. The company’s shares, which currently do not pay dividends, resume trading this morning.