Mesoblast accelerates Singapore manufacture plans

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THE ROADHOUSE PHARMACY: Mesoblast Limited (ASX: MSB) is bringing forward plans for its commercial manufacturing operations in line with anticipated product launches in the United States and other major markets.

Mesoblast also announced that it will receive incentives from the Singapore Economic Development Board (EDB) for activities in Singapore related tomanufacturing operations, as well as product development and commercialisation.

“Bringing forward commercial manufacturing operations in Singapore is an important part of our overall global strategy as we prepare for product launches,” Mesoblast chief executive Silviu Itescu said in the company’s announcement to the Australian Securities Exchange.

“Singapore offers Mesoblast important benefits for our commercial, manufacturing and research operations. In particular, Singapore’s business friendly environment, focus on cellular therapies and strong scientific base, supported by the EDB and the Agency for Science, Technology and Research (A*STAR), are all assets to Mesoblast.”

Mesoblast’s existing operations in Singapore include clinical manufacturing supply of its proprietary mesenchymal lineage products under contract manufacturing agreements with Lonza, a leader in the pharmaceutical and biotechnology industries.

These agreements include exclusive access by Mesoblast to Lonza’s existing state of the art facilities in Singapore for allogeneic stem cell therapy, subject to certain exceptions.

In addition, under these agreements, Mesoblast can trigger a process requiring Lonza to construct a purpose-built manufacturing facility exclusively for Mesoblast’s use.

Mesoblast said access to state of the art manufacturing facilities enables it to benefit from advanced bioprocessing technologies to ensure that it meets global market opportunities and capacity requirements for its proprietary mesenchymal lineage products.
 
Prochymal®, the world’s first approved allogeneic stem cell therapeutic and the only allogeneic stem cell therapeutic designated by the United States Food and Drug Administration as both an Orphan Drug and Fast Track product, is Mesoblast’s most advanced product and is being first developed for the treatment of steroid-refractory Graft Versus Host Disease.

Other major late-stage indications for Mesoblast’s mesenchymal lineage products include congestive heart failure, degenerative disc disease, and Crohn’s disease.

Website: www.mesoblast.com

Imugene appoints Bachem to manufacture cancer vaccine peptide

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THE ROADHOUSE PHARMACY: Imugene Limited (ASX: IMU) has appointed Bachem AG to undertake clinical-grade manufacture of the peptide component of its proprietary therapeutic HER-2+ cancer vaccine HER-Vaxx.

Imugene said Bachem has experience in synthesising clinical grade peptides suitable for incorporation and assembly into the vaccine delivery platform to be used in HER-Vaxx, and has previously manufactured the peptides (three individual peptide B-cell epitope antigens) used in the completed Phase 1 breast cancer trial.

All three peptides are being combined into a single (longer) version of peptide, which Imugene said could potentially result in manufacturing challenges.
 
Bachem has now completed a successful feasibility for this longer peptide, and hence manufacture of the vaccine has now commenced.

HER-Vaxx is a proprietary therapeutic cancer vaccine that stimulates a polyclonal antibody response to HER-2/neu.
 
HER-Vaxx has successfully completed a Phase 1 study in breast cancer and the next stage of development will be a Phase 2 study in gastric cancer.

“Over my 25 years in the global peptide community from both the scientific and business perspective, Bachem has been a constant in quality and experience,” Imugene Limited executive director Dr Nick Ede said in the company’s announcement to the Australian Securities Exchange.

“Given Bachem’s experience in supplying peptides in the form suitable for our vaccine delivery platform, this is a logical choice for the manufacture of our clinical grade peptide.”

Website: www.imugene.com

Prima BioMed achievs US patent for CVac technology

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THE ROADHOUSE PHARMACY: Prima BioMed (ASX: PRR) has received a Notice of Allowance from the United States Patent and Trademark Office, protecting the company’s CVac™ technology.

The company said CVac™ technology is currently in development for ovarian and pancreatic cancer.

“The allowance of this key USA patent is a significant milestone,” Prima BioMed chief executive officer Matthew Lehman said in the company’s announcement to the Australian Securities Exchange.

“The grant of the USA patent would complete the granting of all pending applications relating to the company’s intellectual property portfolio.”

The application protects the method of composition and method of use of Prima’s CVac for the generation of a cytotoxic T cell response against the mucin 1 antigen.

Prima BioMed explained CVac is a personalised immunotherapy composed of a patients’ own dendritic cells pulsed with the cancer antigen mucin 1, conjugated to oxidised mannan fusion protein.

The pulsed dendritic cells are then reinjected into the patient to stimulate an immune response to the mucin 1 cancer antigen.

Website: www.primabiomed.com.au

SomnoMed starts business in Spain and Portugal

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THE ROADHOUSE PHARMACY: SomnoMed Limited (ASX: SOM) announced it will commence marketing the company’s SomnoDent® products from July in Spain and Portugal.

The company is now looking to appoint a national sales & marketing manager to be based in Barcelona or Madrid.

To facilitate its operation in Spain, SomnoMed has entered into an agreement with Mondental, one of the leading orthodontic laboratories in Spain to provide handling and after sales service.

Mondental, based outside Barcelona has also been granted agency status to sell the SomnoDent® product line to its client base of more than 1,000 dentists in Spain and Portugal.

“After concluding agreements and starting operations in Finland and UK/Ireland very recently, Spain and Portugal was the third area we were planning to start marketing our SomnoDent® products in the financial year 2014/15,” SomnoMed executive chairman Dr Peter Neustadt said in the company’s announcement to the Australian Securities Exchange.

“Spain and Portugal, together with the other newly opened markets in Europe, should allow SomnoMed to cement its leadership position in Europe and secure growth for years to come.

“I am very pleased that we were able to identify a high quality fulfillment partner, and enter into agreements in time to commence operation at the beginning of the new financial year.

“Our preparation for the education of dentists and physicians has started and we hope to see first sales during the Northern summer.”

With the inclusion of Spain and Portugal, SomnoMed is operating in 16 countries in Central, Northern and Southern Europe.

All of these European operations are managed directly by SomnoMed and its own sales operation, with the exception of Italy, which is currently represented by a third party distribution partner.

Europe represents 40 per cent of SomnoMed’s global sales and is experiencing fast growth, which the company identified is due to insurers increasingly adopting oral appliance therapy as a more patient friendly and compliant therapy for obstructive sleep apnoea than CPAP.

Website: www.somnomed.com.au

Tugboat turmoil

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IN THE LOBBY: The Chamber of Minerals and Energy of Western Australia (CME) has predicted doom and gloom for the resources sector, in particular for northwest iron ore producers, if the Maritime Union of Australia (MUA) takes industrial action in Port Hedland.

“Any disruption to the port’s export operations will have an immediate and negative impact to iron ore producers and both the state and national economies,” CME chief executive Reg Howard-Smith said.

“Port Hedland is the largest bulk export port in the world.  Its contribution to our economy is far too valuable to risk in any industrial negotiations.”

The CME said the industry is concerned the strike could result in costly and negative flow-on impacts for other ports associated with the MUA’s claim.

“Another significant consequence would be the damage to Western Australia’s international reputation as a safe investment destination and a reliable supplier of vital commodities such as iron ore,” Howard-Smith said.

“Any retreat to the bad old days of industrial chaos in the Pilbara will mean resources projects get developed elsewhere, costing jobs locally.”

The CME said the Western Australian resources sector is focused on capital and labour productivity, particularly given volatile market dynamics.

To that end CME have been urging Federal and State Governments to focus on policy initiatives which address the rising cost of doing business here in Western Australia.

“Exorbitant pay claims, which deliver no increase in productivity have no place in the modern and world-class Western Australian resources sector,” Mr Howard-Smith said.

The CME pointed to the WA State Budget released earlier this month, which it said had highlighted the economic importance of the resources sector, with more than 22 per cent of the State Government’s revenue coming from mining royalties alone.

“The benefits of the resources sector to the WA community are pretty clear,” Howard-Smith said.

“However we need to recognise and address the cost challenges faced by industry, if we are to continue to deliver ongoing prosperity to the community.”

Clinuvel Pharmaceuticals scores US orphan-drug designation

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THE ROADHOUSE PHARMACY: Clinuvel Pharmaceuticals (ASX: CUV) has announced that afamelanotide, the active ingredient in the company’s proprietary drug SCENESSE®, has received orphan-drug designation from the US Food and Drug Administration (FDA) for the rare Hailey-Hailey Disease (HHD, also known as familial benign chronic pemphigus).

Clinuvel exlpained that orphan-drug designation is granted by the FDA’s Office of Orphan Products Development to drugs which have the potential to diagnose or treat rare conditions, which are defined as those affecting less than 200,000 individuals in the United
States.

The company said the orphan designation entitles Clinuvel to technical assistance throughout the development process for HHD, potential fee reductions and tax credits, and seven years’ market exclusivity if approved for marketing by the FDA.

The announcement followed another by Clinuvel that SCENESSE® had received an orphan designation from the European Medicines Agency.

“This designation is the second from a major regulatory agency to recognise the potential of afamelanotide to treat HHD patients, who currently lack an effective therapy,” Clinuvel Pharmaceuticals acting chief scientific officer Dr Dennis Wright said in the company’s announcement to the Australian Securities Exchange.

“We are encouraged by the regulatory support to date and now await the outcomes of the Phase II study.”

SCENESSE® is currently being evaluated as a therapy for HHD in a Phase II study in Italy, following on from earlier findings that the drug has protective and anti-oxidative effects on cutaneous cells.

An earlier two patient observational study in HHD in 2012 gave first evidence that the drug was well tolerated and of clinical benefit.

Email: investorrelations@clinuvel.com

Website: www.clinuvel.com

Funds across the Boards

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THE FUND RAISER: Some bigger numbers this week as the juniors boosted their bank balances.

Capital Raising

Sovereign Metals (ASX: SVM) will place up to 15.25 million ordinary shares at 22 cents each to sophisticated investors, to raise $3.35 million before costs.

Aterra Capital, a key investor and substantial holder in the company with 10.5 per cent of the existing shares, will subscribe for 1.35 million new shares.

The funds raised from this placement will be used to expedite the exploration and development of Sovereign’s Central Malawi graphite project, and for general working capital and business development purposes.

Debt reduced by $59 million

Discovery Metals (ASX: DML) and its lenders have agreed to reduce the company’s existing interest bearing debt by US$59 million (10.5 cents per share) and re-profile repayments of outstanding debt.
 
In summary the debt re-profile involves:

A reduction in gross interest bearing debt (including capitalised interest) from US$159 million (outstanding balance) to US$100 million (new balance);

A waiver of all continuing defaults under the Project Finance Facility and the Revolving Credit Facility;

A 12 month standstill on principal and interest payments and together with all covenant testing other than a minimum cash balance;

Interest rate to be LIBOR plus 5 per cent with interest capitalised until September 2018;

An extension to the term of the loan, with scheduled repayments commencing in September 2018 and ending in June 2023; and

An incentive payment to the lenders of no more than US$20 million from 30 per cent of net cash flows after the new balance is fully repaid.

“The Debt Re-Profile with the company’s lenders brings certainty to Discovery Metals,” Discovery Metals chairman Jeremy Read said.

“With the significant reduction in overall debt and an effective 12 month standstill in place, Discovery Metals can now focus exclusively on its operating strategy to transition the Boseto project to underground mining and in doing so supply the processing plant with consistent higher grade, higher recovery sulphide copper ore and commence the Zeta Underground Mine.

$3.1m share placement

Elemental Minerals (ASX: ELM) has received placement commitments to raise $3.1 million at 25 cents per share from sophisticated and institutional investors.

“The successful raise, at a premium to the market price, is particularly pleasing given the tough market conditions experienced by junior miners. Elemental Minerals CEO Iain Macpherson said.

“The quality and strategic nature of the Sintoukola project, has ensured that we were able to secure this funding, which coupled with the recent transaction through which Harlequin, one of the company’s founding shareholders, acquired Pala’s stake in full at a very significant premium of 34.07 cents per share, puts the company firmly on course to execute on its recently announced new development strategy and conclude negotiations with a strategic partner that will enable future development of the project.”

Working Capital Funding completed

Hazelwood Resources (ASX: HAZ) has executed all formal documentation required in respect of a US$4 million working capital loan facility provided by specialist resource investment fund, Siderian Resource Capital Limited.

The drawdown of this Working Capital Facility remains subject only to the company completing a placement to raise no less than $1.5 million, for which the company has received firm commitments for $1.5 million.

“We are delighted to have further strengthened our business relationship with our global sales agent, Wogen through the completion of this Working Capital Facility with Siderian, a vehicle in which Wogen has an investment,” Hazelwood Resources managing director Terry Butler-Blaxell said.

“We see this funding as representing a significant step forward in the progress of the company, greatly improving the financial flexibility of the business as it continues to grow its share of the global ferrotungsten market, as well as providing a number of other benefits whilst minimising dilution for our shareholders.”

Initial DFS funding secured

Excelsior Gold (ASX: EXG) has accepted a credit approved offer of up to $4 million via a convertible loan facility from Macquarie Bank.

The facility will provide working capital to complete a Definitive Feasibility Study over the Kalgoorlie North gold project.

The DFS will evaluate construction of a new standalone one million tonnes per annum treatment plant and other possible toll milling and joint venture scenarios.

“Excelsior Gold views this facility as recognition of the technical and financial merits of the project,” Excelsior Gold managing director David Hamlyn said.

“The facility is well timed for the commencement of a Definitive Feasibility Study for the project and prudent in the current market conditions.”

What the Brokers Say

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WHAT THE BROKERS SAY: Interesting news and views from across the Resource Analyst universe.


Website: www.hartleys.com.au

Buxton Resources Limited (ASX: BUX)

Magmatic nickel-copper sulphide intersected at Zanthus

Buxton Resources recently completed RC drilling at the Zanthus project in the Fraser Range, confirming the presence of highly prospective mafic/ultramafic rocks and more importantly identified magmatic nickel-copper sulphide mineralisation through petrology and assay results.

No ore-grade intervals were reported but two holes returned nickel values around 0.12 per cent nickel within ultramafic rocks while testing conductive targets located within three kilometres of one another.

Prior to further exploration BUX plans to undertake a full technical review of the data collected over the project area.

Results to date clearly warrant further work in and around targets ZV10 and ZV07, which could involve more detailed geophysical surveys (magnetics and/or electromagnetics (EM)) and more drilling.

Western margin of intrusive structure upgraded by drilling

The aim of the first pass drilling program was to test 20 bedrock conductors originally identified through airborne EM surveys but followed up with ground EM prior to drilling.

A vast majority of the conductors tested were explained by graphitic rocks or iron sulphide accumulations, considered to be of low interest for magmatic nickel-copper mineralisation; however, the drilling of six targets intersected gabbro (mafic) and ultramafic rocks considered to be priority hosts.

Five of the six holes which intersected gabbro and/or ultramafic rocks are located along the western margin, a large interpreted intrusive structure which spans over 10kms of strike.

This zone or corridor may provide a focus for future exploration.

Target ZV10 – large conductor with confirmed nickel mineralisation

Out of all the drill results reported the standout hole is ZRC086, which returned 4m at 1,219ppm (0.12 per cent) nickel, 114ppm copper from 96m, contained within a 12m zone of ultramafic host rock.

The hole was drilled to test conductive target ZV10, defined by as strong conductor, coincident to some low tenor nickel geochemical anomalism.

The target has a north-south orientation and an approx. 1km strike extent, and was previously considered to be a moderate priority anomaly.

Petrographic analysis of the mineralised zones (from 96-100m) identified “definitively magmatic sulphide blebs of inter-grown iron sulphide (pyrrhotite), nickel sulphide (pentlandite) and minor copper sulphide (chalcopyrite) from within ultramafic”.

Fraser Range still the hottest address for nickel

The Zanthus project has been upgraded by the confirmation of magmatic nickel-copper sulphide mineralisation, but further work will be required to locate potential higher grade zones of mineralisation.

That Buxton has highly prospective ground within the Fraser Range has been validated by the drilling.

A full technical review will determine the level of next exploration within the project area.

Greenfield nickel exploration remains high risk but can be highly rewarding, especially within the Fraser Range.

Buxton has a tight capital structure, low market cap of around $12 million (EV of approx. $10 million), and has now confirmed magmatic nickel sulphides, which could translate to discovery success.

Website: www.breakawayresearch.com

Adelaide Resources (ASX: ADN)

All the hallmarks of a major copper discovery

Shallow aircore drilling at the Alford West prospect in South Australia has continued to return some of the most impressive drill intersections seen from any exploration company in recent times.

Four defined ‘zones’ of higher grade copper mineralisation have been modelled with each zone still open at depth.

A deeper drill program is planned for the second half of 2014 which will better quantify the known mineralisation and test likely depth extensions, whilst also providing a strong opportunity for a market re-valuation of the company.

Adelaide Resources continues to steadily advance its flagship Moonta project, located at the southern end of the ‘Olympic Copper Gold Province’ in the Moonta-Wallaroo district of South Australia’s Yorke Peninsula.

An extensive shallow aircore drill program targeting the previously defined 3.5 kilometre Alford West geochemical anomaly has now been largely completed.

Multiple impressive intersections have continued to flow following early standout hits of 20m at 4.2 per cent copper and 0.27g/t gold from 32m, and 45m at 1.56 per cent copper and 1.83g/t gold from 13m.

While these highlights often attract short lived market attention, it is the ‘big picture’ which appears to have been overlooked: Alford West is demonstrating all the hallmarks of a major discovery.

Adelaide has now defined four target zones which appear likely to contribute towards an eventual mineral resource.

While shallow aircore drill holes have been completed over these zones (with economic grades and widths reported), they are yet to be adequately tested below approx. 100 metres.

Evidence from nearby historical drill holes (and other deposits within the region) indicates that mineralisation commonly continues to significant depths.

The potential size of the Alford West prospect should not be underestimated.

The combined strike length now exceeds 3km with deeper RC and diamond drill programs set to begin testing the depth extent in the second half of 2014.

Positive news flow will likely soon follow providing significant opportunity for a company re-rating as the potential scale of the system is realised.


Disclaimer: The above is intended as a guide only. The Roadhouse accepts no responsibility for investments made from this advice, successful or otherwise.

The views, opinions or recommendations of this article do not in any way reflect the views, opinions, recommendations, of The Resources Roadhouse.

The Roadhouse makes no representation or warranty with respect to the accuracy, completeness or currency of the content. The content is for educational purposes only and does not constitute financial advice. Independent advice should be obtained from an Australian financial services licensee before making investment decisions.

This Week in The Roadhouse Pharmacy

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THE ROADHOUSE PHARMACY: There’s a great deal of interest in the Bio-tech sector at the moment, so we have opened our own Pharmacy to keep our readers up to speed.

Clinuvel Pharmaceuticals scores US orphan-drug designation

Clinuvel Pharmaceuticals (ASX: CUV) has announced that afamelanotide, the active ingredient in the company’s proprietary drug SCENESSE®, has received orphan-drug designation from the US Food and Drug Administration (FDA) for the rare Hailey-Hailey Disease (HHD, also known as familial benign chronic pemphigus). READ MORE…

Phosphagenics patch eases pain in racehorses

Clinuvel Pharmaceuticals (ASX: CUV) has completed a study using its TPM®/Oxycodone topical patch to manage shin soreness pain for thoroughbred racehorses. READ MORE…


Immuron to sell Travelan® in South Korea

Immuron Limited (ASX: IMC), manufacturer of Travelan®, has entered into an agreement with DB Pharm Korea for the sale of Travelan® in South Korea. READ MORE…

PharmAust gets approval for clinical study

PharmAust Limited (ASX: PAA) has received approval from the Royal Adelaide Hospital Governance Committee to begin evaluation of proprietary drug PPL-1 in a Phase I/II clinical trial in man. READ MORE…

Uscom appoints three new UK distributors

Uscom Limited (ASX: UCM) has appointed three new specialist distributors of the company’s Uscom BP+ suprasystolic oscillometric blood pressure monitor in the United Kingdom. READ MORE…

Talga cashed up for Nunasvaara trials

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THE BOURSE WHISPERER: Talga Resources (ASX: TLG) is undertaking a combined capital raising totalling $3.1 million, the proceeds from which will be used to accelerate development of the company’s wholly-owned high-grade Nunasvaara graphite-graphene project in Sweden.

 

Talga Resources project locations in north Sweden. Source: Company announcement

 

The funds are to be raised via a combination of a fully underwritten non-renounceable rights issue and single tranche placement on the same terms.

The company said the proceeds will enable it to begin a maiden test mining program and construct/commission a pilot plant to process the first bulk samples from Nunasvaara.

This work is anticipated to take place concurrently with the scoping study the company already has underway.

“Given rapidly accelerating developments in global commercial markets for graphene, Talga has seized the opportunity to secure further funds and fast-track its work program by strongly capitalising the next stages of project development,” Talga Resources managing director Mark Thompson said in the company’s announcement to the Australian Securities Exchange.

“The company is delighted by the reaction of investors to our recent developments and pleased to offer this opportunity to shareholders at an exciting early stage.

“These funds will be used to move more rapidly into trial mining and pilot plant stages, while completing previously announced preliminary economic studies.

“Talga sees the underwritten support to accelerate our graphite-graphene development program as a strong endorsement and market vote of confidence.

“Additionally the placement introduces some new and strategic shareholders who share Talga’s vision of successful transition from explorer to near term graphite-graphene miner and processor.”

Talga indicated the funds raised via the entitlement offer and placement will be used to:

Accelerate development work on the Nunasvaara graphite-graphene project;

Fund a trial mining program and pilot plant to process a bulk sample and confirm new graphitegraphene production process operational on larger scale;

Provide commercially significant size samples of graphite and graphene for more advanced economic evaluations; and

For general working capital.

Email: admin@talgaresources.com

Website: www.talgaresources.com