The Paradigm Biopharmaceuticals Ltd (ASX: PAR) share price could hit a record high this morning after the medical researcher boasted of a “ground breaking” discovery for its drug designed to treat osteoarthritis in the knees.
According to the company its patented drug Zilosul has been shown to inhibit ‘nerve growth factor’ (NGF) in bone cells in knee osteoarthritis patients and thus reduce pain. It reports that its research has been peer reviewed and published in the international scientific journal PLoS One.
The research also supports Paradigm’s conclusions from its recent Phase II clinical trial into the treatment of pain and cartilage degeneration in knees and supports its regulatory submissions to the U.S. healthcare regulator the FDA.
Paradigm will need to run a far larger, more expensive, and clinically comprehensive clinical trial into the drug in order to persuade the FDA of its clinical efficacy.
The biotech also claimed the drug offered a “very attractive commercial opportunity” for ‘big pharma’ to partner with it in funding research and commercialisation. In part it claimed this is because the drug could help meet the need to treat the “opiate addiction” crisis in the US.
If it can strike a partnership deal with “big pharma” this is likely to be a major positive for the business and stock.
All this sounds exciting and Paradigm already has a market value around $488 million despite having no material revenues and expensive drug trials ahead of it. Thankfully it did have around $72 million cash on hand as at June 30, 2019.
As we’re not far from Melbourne Cup Day, Paradigm could be considered one of the ‘favourites’ amongst a field of speccy ASX biotechs looking for eternal glory.
Others include Mesoblast limited (ASX: MSB), Opthea Limited (ASX: OPH), Next Science Ltd (ASX: NXS) and Bionomics Ltd (ASX: BNO). The first three already posting sales and looking worthy of more research for anyone seeking the next biotech blockbuster.
However, as a word of warning biotech businesses’ share prices can rise for a long time on the rumour or speculation before tumbling spectacularly on the fact.
Along the way different forces are jockeying for position often in possession of different information to turn profits, with any insider selling or unusual volume something to keenly watch for.
If you’ve done your research on Paradigm then it might be worth a small punt, although I am not a buyer of shares myself.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of February 15th 2021
You can find Tom on Twitter @tommyr345
The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
- On a serendipitous day, Tom Richardson is leaving the building – December 17, 2019 11:55am
- Why Aerometrex shares have doubled their IPO price – December 16, 2019 4:32pm
- Why the National Veterinary Care share price is going nuts today – December 16, 2019 3:39pm