2 ASX healthcare shares rocking higher on big news

This 'spray-on skin' company and cancer-fighting biotech have exciting news for shareholders today.

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ASX healthcare shares are one of only two market sectors trading in the green at the time of writing.

The S&P/ASX 200 Health Care Index (ASX: XHJ) is up 0.55% and is the best sector of the day so far.

These two ASX healthcare shares are having a particularly good day following company updates.

2 ASX healthcare shares soaring on exciting news

Two ASX healthcare shares are flying higher today after the companies announced significant news.

Let's check them out.

Avita Medical Inc (ASX: AVH)

The Avita Medical share price is currently 10.2% higher at $2.81 per share after the 'spray-on skin' burns treatment company announced its first quarter results for 2024.

For the three months ending 31 March, Avita reported a 5.8% lift in commercial revenue, compared to the first quarter of 2023, to $11.1 million. The gross profit margin came in at 86.4%.

Cash and cash equivalents fell 23% to $16,951,000, with Avita's CFO David O'Toole explaining that the big spend mostly related to several non-recurring expenses.

O'Toole commented:

We acknowledge the significant cash utilization this quarter, however we remain confident in our financial stability and our ability to reach cashflow break even as guided.

The company expects to reach cashflow break even no later than the third quarter of 2025.

As for forward guidance for 2024, Avita said commercial revenue for the second quarter was expected to be in the range of $14.3 million to $15.3 million.

Avita expects full-year commercial revenue at the low end of its previously provided guidance range of $78.5 million to $84.5 million.

During the quarter, Avita launched PermeaDerm, a co-branded biosynthetic wound matrix, in the United States.

Avita CEO Jim Corbett said:

We believe we have taken the necessary measures to invigorate our burns business and improve our commercial sales process to return to sustained growth.

We remain dedicated to establishing RECELL as the standard of care for burn and full-thickness skin defects.

Simultaneously, we are actively transforming AVITA Medical into a broad wound care business by expanding our portfolio to address the full spectrum of clinical needs.

The ASX healthcare share is down 32.7% in the year to date and down 23% over the past 12 months.

Race Oncology Ltd (ASX: RAC)

The Race Oncology share price is currently 7.1% higher at $1.66 per share after the clinical-stage cancer drug biotech announced positive preclinical study results.

Race said bisantrene and decitabine used together had "significantly improved cancer cell killing across a broad panel of 143 tumour cell lines than either drug used alone".

The company said the results support the use of the combined drugs as a potential treatment for many cancers. These include solid tumours such as lung, prostate, pancreas, breast, and head and neck cancers.

The two drugs will be explored further in a proposed Phase 1/2 investigator-initiated AML clinical trial.

Race CEO Dr Daniel Tillett commented:

These results open exciting new treatment opportunities for both bisantrene and decitabine. While decitabine has proven its effectiveness in haematological cancers, it has not demonstrated clinical utility in solid tumours, like lung or breast cancer.

This new body of work is highly supportive of the results from the University of Newcastle in preclinical AML models using a combination of bisantrene and decitabine.

Race Oncology also released a new investor presentation yesterday.

The ASX healthcare share has streaked 95.3% higher in 2024 so far and is down 0.90% over the past year.

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Avita Medical. The Motley Fool Australia has recommended Avita Medical. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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