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- Biotech researcher Biotron (BIT) has been in the spotlight this week for a potential coronavirus cure
- Eagle-eyed investors noticed a late-December U.S. patent application mentioned specific treatments for the virus
- The company’s shares jumped almost 40 per cent on Wednesday based on market speculation
- In response to an ASX “explain yourself” query, however, Biotron made no mention of the virus
- As such, shares have settled once more as the hype dies down
- Still, investors are watching Biotron closely for any more news on a coronavirus treatment
- After the company’s quarterly report today, shares are up 5.8 per cent and worth just over seven cents each
Biotech researcher Biotron (BIT) has had a rollercoaster week as punters turn to the healthcare sector while the coronavirus rages on.
The company, which is currently focussed on developing a treatment for HIV and Hepatitis C, saw little fluctuation in its share price over 2020 until a 36.67 per cent spike on Wednesday. Biotron had released no news to the market that day.
Rather, it seems astute investors had come across a U.S. patent for which Biotron applied in late December 2019. The patent related to the company’s flagship BIT225 treatment and other antiviral compounds and methods.
Importantly, however, the patent application had several prominent sections devoted to the treatment of the coronavirus. Along with applications for treating lentivirus, HIV, hepatitis C and equine arteritis virus, the compound has specific applications in affecting proteins found in the coronavirus.
Of course, this patent was filed before the coronavirus started breaking global headlines. The most recent outbreak was first reported to the World Health Organisation on December 31, 2019.
As such, while the new virus had already been spreading in Wuhan up to this point, it’s likely the inclusion of the coronavirus in the patent application was simply due to its similarity in proteins to other viral infections like HIV.
Backing this suggestion up is the ASX’s query into the unusual share price jump, launched in a letter to company management the same day shares saw their sudden spike.
In Biotron’s response to the letter, the company referred to the recent patent applications and upcoming clinical trial data for BIT225 but ommitted any mention of the coronavirus.
The company’s response subdued the market hype as quickly as it grew, and by Thursday afternoon’s close, shares were back down almost 16 per cent.
Today, the company released its quarterly report for the December quarter of 2019. While nothing to call home about, the report fell within market expectations.
The company is yet to start earning money but seems adequately funded to move forward with $8.6 million cash on hand at the end of the quarter. Biotron forecast roughly $1.5 million in cash outflows for the current quarter.
Biotron’s shares have had a rocky day so far. While eager buyers have put a hold on their orders, Wednesday’s sudden surge shows just how closely health care — and particularly biotech — stocks are being watched as investors want first dibs on any companies who might cash in off the coronavirus scare.
With the unprompted mention of a potential treatment for the virus before it was being compared to SARS, Biotron has thrust itself in the spotlight. The company is yet to make any formal mention of the virus to investors, but a shift in focus from HIV and Hepatitis C to the coronavirus could be a breakthrough moment for Biotron.
Nevertheless, at midday AEDT shares in Biotron are currently a slight 5.8 per cent up and trading for 7.3 cents each. Biotron has a $49.14 million market cap.
