There is no doubt that the market is wary of Oncosil Medical Ltd.
And as a stockholder of this company, I share the markets sentiment.
But does this mean that investment in Oncosil Ltd in the near future is without fruitful reward?
THE SCIENCE STACKS UP
The delivery of local brachytherapy for malignant disease is not a de novo concept.
The technique of ultrasound guided (+/- endoscopic delivery) insertion of a small brachytherapy device similar to the Oncosil product is an established treatment option in other malignancy processes such as prostate cancer.
Although Adenocarcinoma of the Pancreas is an entirely different disease process when compared to prostate cancer, the method of inserting a small radioactive device to deliver local radiotherapy is an established and proven medical therapy for rapidly dividing malignant cells.
The aim is that the radioactive particles disrupt the DNA within the malignant cells and subsequently prevent replication, or cause cell death. Some tumours are indeed more radiosensitive than others, and this depends upon the classification of the neoplasm.
In addition to this, local delivery of radiation with small circumferential boundaries of effect cause less local side effects that targeted external beam radiotherapy alone. The technology for external beam radiation has improved significantly over the past few decades, but ultimately to get to malignant pancreatic cells, some normal cells will be affected by the radiation.
So based on this, as an investor I was very much interested in Oncosil Medical. In essence the theory makes sense, but in Medicine we require a burden of scientific proof before subjecting our patients to new therapies.
POOR COMMUNICATION AND REGULATORY FAILURES
The failure of Oncosil Medical to achieve a successful regulatory review by the BSI for CE mark certification was made significantly worse and more painful for investors by the fact that the company overplayed their hand in communicating the likelihood of success.
This point cannot be understated.
Although successful in their revision application and review, their questionable communication strategy was subsequently confounded by their language and terminology surrounding the “complexity” of their product, and the BSI’s “lack of understanding” in their initial assessment of the products viability for the commercial oncology market in Europe.
Very briefly, in my opinion, some of the factors that lead to the initial rejection by BSI include:
·A small cohort study of patients (even if it was double what was originally recommended)
·Safety and tolerability defined as primary endpoints
·Discrepancy in comparative chemotherapy treatments
·A limited surveillance period (presented thus far)
·(+/- Geopolitical uncertainty in the EU / British Market – I am uncertain whether this is quantifiable, but may have played a role in the delay)
I accept that some of these factors are due to inherent nature of invasive adenocarcinoma of the pancreas, and subsequently cannot be controlled or adjusted for.
However, it’s no secret that in Life Sciences and Biotechnology sector that the cost of the scientific process in drug / medical device / medical technology development can be a protracted and expensive endeavour – often with variable levels of success.
Because of this, I think that Oncosil Medical employed a management strategy with more “marketing enthusiasm” than proper and established scientific rigor – in what was already a clinically challenging research area. That is not to say the research was done poorly, rather the company’s interpretation and communication of limited and premature analysis and trends was viewed with a significant ulterior commercial motive.
This ultimately led them to hasten their proposed regulatory timeline to gain approval for a commercially viable product and gain access to the market.
(As a side note - perhaps the sale of Sirtex within the preceding few years contributed to this, as the company tried to market themselves as the next Sirtex for potential investment opportunities and early commercial take-over / buyout. I admit this is largely speculative, but not unreasonable considering the significance within the Australian Biotech Industry and the management personnel of Oncosil Medical)
SUCCESSFUL OUTCOME AND PENDING CE CERTIFICATION
Despite all of the above, it would appear that Oncosil Medical has managed to pull through and address the major concerns expressed by the BSI.
In my opinion the majority of that success can be put down to recommendations from international experts in Pancreatic Ca, as there is little Oncosil could have done within the space a of a few months to ‘improve’ on the collection of data they have available.
BSI is a regulatory agency, but like all regulatory agencies, it is still guided and influenced by significant clinical and academic leads throughout Europe and globally. I expect that the potential this product inspires (even from very limited data) was enough to allay concerns for CE mark certification.
The final stage of the BSI review (PMS and PMCF) requires a significantly less burden of proof, and it is my opinion, along with many others, that Oncosil Medical will now receive CE mark certification within the coming weeks.
FINAL THOUGHTS
Ultimately it is my opinion that Oncosil Medical is a good Australian Biotechnology investment, and something that will be fruitful for investors within the short to medium term.
The Oncosil Medical management team has displayed a level of immaturity in their communication style and execution of the CE mark certification process, which I’m sure has left some with a soured relationship with this company.
This will need to improve significantly if the company is to achieve additional commercial success beyond achieving the CE mark.
I am hopeful that this will encourage the company to be more considered in their communication and management of significant milestones.
I am more hopeful that the trends and preliminary analysis and results reported in the PANCO and OncoPAC study continue to yield positive clinical outcomes for sufferers of Pancreatic Cancer.
AIMHO DYOR
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