Clarity Pharmaceuticals Ltd

ASX:CU6

Clarity Pharmaceuticals Ltd

ASX:CU6
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$3.04 (0%)
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#103
Rank
8
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32
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Reports (1) My Report Forum Investors
Forum Topics CU6 CU6 Interview, CEO Alan Taylor

Pinned straw:
Scoonie
Added 8 months ago

Interesting interview with CU6 CEO, Alan Taylor by Michael Frazis. The interview undertaken towards the end of March.   As everyone knowns in the last few months it has suddenly got very hard for biotechs, particularly for non-revenue companies like CU6.  Stock price wise, TLX and NEU have fared better, having products in the market and both being cash flow positive.     

Clarity Pharmaceuticals, with chairman Dr Alan Taylor

Some points from the interview:

  • AT outlines the science case for CU6 including:

i)                        Currently they have 3 FDA fast track approvals.

ii)                      comment on sensitivity of 2 competitors with products in the market (Telix and Lantheus), stating their prostrate diagnostic sensitivity is a poor 30 – 40%.   CU6 claims their Cu64 product gets contrast (sensitivity) up to 15 times better than the competition with equal specificity.

  • FDA employs 18,000 people it turns out that only 1,000 have been terminated and according to Alan many of them being asked to return. (The recent NEU Phase 3 FDA meeting was not postponed and presumably speaks to a functioning FDA).
  • Its obvious CU6 is financially in a bind, needing soon to raise capital. Whilst they have $100m as at the end of March, this will only get them to around halfway into next year. They are, assuming continued scientific success, 2 – 3 years away from commercialisation and revenue.
  • AT made the point that CU6 is around 60% is owned by the top 20 shareholders with mainly institutions represented.  The inference by AT, is they are likely to be a more amendable to a capital raise than a predominantly retail shareholder base.  (State Street became substantial yesterday).
  • AT said of CEO of Telix Chris Berenbrauch Telix:  “He reached out to me to partner with him”. (Cannot imagine AT and CB ever happily power sharing)
  • Clarity is currently 6% shorted. AT says Phil King (Regal) of Opthea-step-in-dog-shit fame, is one of the CU6 shorters. (The games people play)


Of course the success of CU6 all hinges on their continuing to deliver on their clinical trials. And the market’s continued confidence in them. Who really knows.

mikebrisy
Added 8 months ago

@Scoonie I've finally caught up with the Michael Frazis interview with Alan Taylor.

To be honest, I got a bit swtiched off at start of the interview with all the time and energy being spent on how the external environment and negative results at other companies are major SP drivers at the moment. In fact, I almost thought WTF, isn't this guy going to talk about the things he controls, i.e., HIS busines! But I do understand he has probably been getting it in the ear from holders who got on near $9.

However, I persisted and I am glad I did. Overall it sounds like things are going well in 76Cu-SAR-bis-PSMA SECURE trial Phase I/II and that they are being both quite ambitious and careful in scoping out the best endpoints for the Phase 3 trial. As you say, there is still about 2.5 to 3 years until revenue in the success case.

So a future raising is inevitable.

The thing that Alan needs to achieve (apart from contining to deliver the clinical program) is timing his next capital raise off the back of good news. I think the $100m on hand should SAFELY get them to the full readout on SECURE 1/2, if they don't take too many detours along the way. Fast-track designation will help with the trial design, and it sounds like he is hopeful of a Breakthrough designation. We should get sight of that given his commitment to continue to drip-feed results, which to date look pretty good. As a former investment banker he knows how to get the timing on raising right. So, I have no concerns about that.

I'm happy with my RL 0.6% (which of course was 1.0% earlier in the year!) I am taking a 5 year view on this one, and if they can create a "Pluvicto buster" then at the earliest sign that I assess the chances of success of that outcome as improving, I'll go bigger. But not before then, irrespective of the SP, as this is still way more speculative than I normally contemplate. That said, looking across all the data so far, I sense there is something very valuable here - the preliminary results from the 13 patients in the Dose Escalation Phase indicates they have something to work with here.

I find this part of capital allocation in the speculative end of the portfolio tough, as there is a demon on my shoulder whispering "you will look back on this one and regret that you didn't take a bigger position at today's SP." But when that happens I douse myself with a figurative bucket of ice water and ask, how well do I REALLY understand what is going on here. I just have to accept that, in the success case, I'll be adding to this at 3x the current SP and that's the price for having a risk exposure today that I am prepared to accept.

The potential reward makes the chances of it going to zero worth it, for a small position. Gotta have a little spice in the portfolio, after all!

Disc: Held in RL and SM

21
mikebrisy
Added 8 months ago

I'm adding this post to Forum on the recent interview of Alan Taylor, even though it relates to the separate announcement made last week;

ASX Announcement Summary

Clarity received an $11,146,204 Research and Development (R&D) Tax Incentive refund, inclusive of interest, as part of the Australian Federal Government’s R&D Tax Incentive program.

• The receipt of the $11.1 million will provide additional funding to further the development of Clarity’s Targeted Copper Theranostic (TCT) platform of products for various cancer indications.

• Clarity is well funded with approximately $106 million in cash, the majority of which will be spent directly on research, development and commercialis ation endeavours in the Company’s key programs.

• Following a thorough review of Clarity’s portfolio of clinical-stage assets as well as an in-depth analysis of the markets and their potential risks, the Company will prioritise the development of 64/67Cu-SAR-bis PSMA for both diagnostic and therapeutic applications in prostate cancer as well as the development of 64Cu-SARTATE in neuroendocrine tumours (NETs) and 64Cu-SAR-Bombesin in breast and prostate cancers.

• Clarity will also continue to progress its Discovery Program, aiming to bring key assets such as 64Cu-SAR -bis FAP and 64/67Cu-SAR -trastuzumab to the clinic.

• As part of this priortitisation process, the CL04 trial with 64/67Cu-SARTATE in paediatric high-risk neuroblastoma and the COMBAT trial with 64/67Cu-SAR-Bombes in in low prostate-specific membrane antigen (PSMA) metastatic castration-resistant prostate cancer (mCRPC) will be closed.

My Assessment

While this was in part about the $11.1m R&D Rebate, as important - if not more important - is the news in the final bullet point that some of the current clinical programs are being closed.

In allocating capital, $CU6 has to picks its winners. It's pre-existing program, while an exciting exploration of the platform, risked proceeding on too many fronts, which basically meant too much dilution before getting to revenue. If $CU6 is successful, then 5+ year down the track if can perhaps have a program that looks more like $TLX's But with no current revenue, a pared down program focused on those with the highest risked value makes perfect sense.

I consider this a welcome move, directly addressing the concerns we've expressed here recently about the amount of dilution ahead.That said, it is still a significant program for such a small company.

Capital allocation for survival involves tough choices. I'm glad Alan is able to make them.

(I can't help myself wondering whether Alan would have done this without the current savage macro-environment in biotech. Perhaps facing the prospect of the SP at almost 80% off its frothy peak has focused his attention. Or perhaps not. But I can't help but wonder.)

Disc: Held in RL and SM

14
topowl
Added 7 months ago

Appreciate the update—and agree this move is probably the right one on paper. But honestly, it just reminds me how wild the ride is in these early-stage biotechs.

One minute you’ve got a “platform,” the next you’re quietly winding down trials and hoping a tighter focus will get you across the line before the next raise. It’s always capital allocation by necessity, not strategy—until you squint hard enough to call it strategy.

The R&D rebate is nice, but we all know it’s a one-off sugar hit. The real question is whether they can get a clean readout on one of these programs before needing to raise again—without torching more shareholder value.

It’s tough. You back the science, you buy the story, and then reality rolls in: timelines slip, trials close, dilution bites. Maybe SAR-bis PSMA really is the winner, and maybe Clarity becomes the next TLX. Or maybe it’s just more of the same—hope, hype, and dilution....who knows with any reasonable level of probability....imo no one, that's who.

“The first rule is not to lose. The second rule is not to forget the first rule.” – Warren Buffett


10
topowl
Added 8 months ago

Who really knows is spot one.

No one, that's who.

I love this quote from Morgan Housel that sums up biotech speccy's for me:-

“Simplicity is the hallmark of truth—we should know better, but complexity continues to have a morbid attraction. When you give an academic audience a lecture that is crystal clear from alpha to omega, your audience feels cheated. . . . The sore truth is that complexity sells better.” 

Funny, I remember when COVID hit and every hopeful speccy biotech holder kept using it as a reason why their stock price was plummeting and their money was done.

How will Clarity go, who knows ?

One thing's for sure, it's a fair bet that any outcome will take a long long time, and cap raise after cap raise.

Or maybe not....

Most people I know who hold in this space usually start by citing the science and stating this will "absolutely succeed".

Then when you ask them to consider "what if" it doesn't, then they usually throw in the word "punt" and "play money" and state it doesn't matter if they lose it all anyway....

Although I do know someone who had a margin call on Clarity....ouch...

Whatever floats their boats I guess.

I really don't see the difference between putting a "bet" on clarity and going to the casino.

A bit ranty I know, but I find the culture of the biotech speccy space a massive turn off.

Good luck to all holders.

Hope they succeed. The tag line on the science sounds like it could make the world a better place....if they can get there before something else does.



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