It was a rollercoaster year on the ASX for the biotechnology sector. We take a look at the top performers
The post Here are the 5 best performing ASX biotech shares of 2021 appeared first on The Motley Fool Australia. –
The price action of ASX biotech shares was nothing short of a mixed bag in 2021.
Several of the majors underperformed the benchmark S&P/ASX 200 Pharmaceuticals & Biotechnology index (AXPBJD), whereas many small-cap names came through the ranks to shine brightly ahead of peers.
The broad index itself was choppy throughout 2021, taking a deep plunge throughout December to finish just 2.1% higher for the year.
Investors watching the ASX biotech space will be keen to see how the sector rolls out of the blocks this year.
Commentary on the broader healthcare sector points to a decade of accelerated growth and heavy capital investment, thrust forward by policies bought on by COVID-19.
With these points in mind, we take a look back and see the year that was for the best performing ASX biotech shares.
Imugene Limited (ASX: IMU)
The Imugene share price was a star performer in 2021 and rallied 300% across that time. The biotech finished the year strongly with a set of positive announcements regarding its clinical trial pipeline.
Imugene first advised it had received US Food and Drug Administration (FDA) Investigational New Drug (IND) approval to initiate a phase I clinical trial of its oncolytic virotherapy candidate called VAXINIA.
It then advised the FDA had awarded IND approval for Imugene to initiate a new phase 2 clinical trial of its immunotherapy drug candidate, HER-Vaxx.
Announcements and updates concerning the HER-Vaxx segment were the major driving force for Imugene’s share price in 2021.
For instance, the company announced it formed a strategic partnership with clinical-stage biotechnology company Eureka Therapeutics in November.
The pair will investigate the therapeutic potential of combining their technologies for the treatment of solid tumours.
Together the group will investigate Imugene’s HER-Vaxx therapy in combination with Avelumab – a label developed by Pfizer and Merck – as a combination therapy in a certain type of gastric/gastroesophageal cancer.
Avelumab works by blocking a certain molecule that suppresses the immune system, whereas HER-Vaxx is specifically designed to treat tumours.
Following these announcements, the Imugene share price spiked towards new 52-week highs.
In early trading on Tuesday, the Imugene share price is up 6.75% to 42.7 cents.
CSL Limited (ASX: CSL)
Shares in global biotech juggernaut CSL finished in the green in 2021 – but not before undergoing some downside volatility in December.
Just prior to this, CSL had fallen sharply off its 52-week high of $318 in November, as concerns around blood plasma collections in the US surmounted and the new Omicron COVID-19 variant began its impulse throughout financial markets.
After thrusting past this 1-year high, this ASX biotech share reversed course and bottomed at $272 by the middle of December, a substantial drop of $46 per share in less than a month.
However, news of the company’s acquisition of Swiss-based biotech company Vifor Pharma for $17.2 billion in cash sent CSL’s share price bouncing off this low.
By the time the company completed its capital raising round for the purchase, investors had already driven CSL shares back to $290 and change to finish the year.
Aside from this momentum to close out 2021, CSL share price action was quite volatile across the year, with a spread of 29% between minimum and maximum closing prices in that time.
Nevertheless, analysts at several investment banks are bullish on the company following its recent acquisition. Citi upgraded its recommendation on CSL shares to a buy and values the company at $340 per share. Morgans is equally as bullish and assigned a price target of $334 per share.
Telix Pharmaceuticals Ltd (ASX: TLX)
Shares in oncology company Telix Pharmaceuticals traded in a relatively narrow ascending channel during most of 2021 after popping in May last year.
The company finished the year up 96% and closed the final session at $7.75 apiece.
News around Telix’s novel imaging platform for prostate cancer, Illuccix, was the major catalyst that saw investors screaming to secure a spot in the company’s growth engine last year.
Adding to the company’s flywheel in 2021 was the FDA approving its Illuccix technology for use as a diagnostic imaging platform for prostate cancer.
The company also now expects European approval for registration status no later than 23 March 2022 for the Illucix platform. This comes after it was awarded marketing authorisation application (MAA) in the bloc.
The team at Bell Potter has Telix as a buy and values the company at $9.65. Meanwhile, Wilsons’ recently upgraded its price target on the company to $10.35.
Both Jarden and Jefferies also reckon Telix is a buy, valuing the company at $8.50 and $7 respectively.
Neuroscientific Biopharmaceuticals Ltd (ASX: NSB)
Neuroscientific Biopharmaceuticals was a decent performer among ASX biotech shares in 2021, gaining 36%.
Flying largely under the radar, the company traded as high as 51.5 cents in September last year, before levelling off and fetching 33.5 cents apiece to close out the final session of 2021.
This price action came after investors bid up NSB’s share price from a low of 21 cents back in February, and then got ahold of it once more in September.
During that time NSB advised that AusIndustry approved an Advance and Overseas Finding under the R&D tax incentive program (TIP) for the development of the company’s lead drug candidate, EmtinB.
The studies will investigate EmtinB as a novel therapeutic treatment for ocular conditions that damage the optic nerve.
Meanwhile, the tax program enables the company to receive R&D tax incentive rebates on up to $25 million of R&D expenditure incurred during 2021, 2022, and 2023. Investors drove up NSB shares in a linear fashion following the release.
Then, in December, the ASX biotech share released positive study readouts from a safety assessment of EmtinB following an in vitro screening program.
Specifically, the researchers were examining ways to predict “drug-induced toxicities in humans prior to first-in-human Phase I clinical studies”.
Why is this relevant? It boils down to the fact some drug interactions produce unintended adverse side effects in humans.
This interplay has regulators advocating drug makers such as NSB to produce known “anti-targets” – like the screening program in this latest update – as part of risk mitigation in drug development.
Doing so improves the known safety and risk profiles of various drugs to improve patient outcomes.
The market sent the Neuroscientific Biopharmaceuticals share price 11% higher on the day of the announcement.
Memphasys Ltd (ASX: MEM)
Shares in ASX biotech Memphasys finished 2021 marginally in the red. However, considering its performance in the final quarter of 2021, it is a worthy mention.
Memphasys started 2021 trading up around 11.5 cents apiece before taking a massive plunge to land just below 6 cents in March.
It stayed around those levels for the bolus of the year, trading sideways in a narrow channel with a spread of just 1.3 cents.
Shares in the medical device and biotechnology company subsequently closed out the month 58% in the green after peaking at 11 cents apiece.
Its share price has since reverted back to its current levels at 9.3 cents. However, it has found support around this level and is trading sideways once more.
Furthermore, the company announced it made its first commercial sale of the Felix System for clinical IVF use in December. The order was made from a women’s centre in Coimbatore, India, marking the first steps in cash flow receipts for this segment.
The post Here are the 5 best performing ASX biotech shares of 2021 appeared first on The Motley Fool Australia.
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The author has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.