Generally speaking, companies move through phases from drug discovery to phase I, II, and III clinical trials, and then on to commercialisation.  

Investors who get on board early can make gains of 10 and even 20-fold, although there's always the risk that trials will fail, and send a company's shares south in a rapid fashion.

On the other hand, if companies continue to perform and successfully commercialise their products, the upside can be huge.

This one's a market darling

One of the best performers among Australian biotech shares over the past year has been 4DMedical Ltd (ASX: 4DX), whose share price has increased from lows of 22.5 cents to $4.58 currently.

4DMedical is currently right in that sweet spot of moving from cash burn to revenue generation, with several key contract wins in recent months after it secured a key US Food and Drug Administration approval in August.

Since that time, the company has secured contracts with four of the most respected academic medical centres in the US to use its CT:VQ technology for lung scans.

It will be interesting to see how quickly these contract wins translate into material revenue for the company, which reported a net loss of $30 million in its last financial year.

4DMedical founder and Managing Director Andreas Fouras said just this week that the company had "unstoppable momentum", which appears to flag further good news in the near term.

Despite its major gains over the past year, I think this is a company to watch closely.

Up and coming

A company at an earlier stage of development is heart drug company Nyrada Inc (ASX: NYR), which has also had huge share price gains over the past year.

The company just today announced it had been granted ethics approval to start a Phase II clinical trial of its heart attack drug Xolatryp.

Nyrada shares are up almost 20-fold over the past year, but the company is still valued at a modest $336.2 million.

Ethics approval for the trial is a positive for the company and pushed the shares briefly to a new 12-month high of $1.43.

It will take another nine to 18 months for this particular trial to be concluded. For investors with the right risk appetite, getting in at this stage before positive results potentially emerge could be a winning move.

And finally, there's PYC Therapeutics Ltd (ASX: PYC), which has more than doubled in value over the past year to $982.8 million.

PYC is progressing a drug candidate called PYC-003, which seeks to address the underlying cause of polycystic kidney disease, with that program currently at the Phase I stage.

The company said it expects to update shareholders on the Phase I trial this year.

PYC is also aiming to develop drug candidates for use in treating retinitis pigmentosa, other forms of vision loss, and the neurodevelopmental disease PMS.

Once again, for investors with the right risk profile, this might be one to keep an eye on.

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The biotechnology company's shares have been trending sharply higher, particularly since mid-October, and are now up almost 20-fold from levels as low as 7.4 cents about this time a year ago.

The shares hit a new 12-month high of $1.43 on the clinical trial news on Thursday, meaning shareholders are sitting on an almost 20-fold return over a year.

Trial set to start soon

The company said on Thursday it had received ethics approval to go ahead with its Phase II trial of the compound Xolatryp, which will be tested for its use in treating "myocardial ischemia reperfusion injury in patients suffering a heart attack''.

The company went on to say:

The trial is a randomised, double-blind, placebo-controlled, multicentre study to assess the safety, tolerability, pharmacokinetics, pharmacodynamics, and preliminary efficacy of Xolatryp in male and female patients of non-childbearing potential presenting with a heart attack undergoing primary percutaneous coronary intervention or angioplasty with stenting. Approximately 200 patients will be dosed for this 1:1 drug to placebo trial.

The company said while safety was the primary endpoint for the trial, multiple efficacy signals were also being evaluated, including cardiac function, extent of cardiac injury, and the incidence of arrhythmias of interest.

The ethics approval allows the company to start establishing trial sites across Australia, with patient approval expected to start in March and up to 10 hospitals excepted to be involved.

The company said that "subject to recruitment rates, the trial is expected to conclude within nine to 18 months of first patient dosing''.

The company added:

Recruitment timelines will be closely monitored, and Nyrada's study plan allows for flexible expansion to additional hospitals in Australia or internationally to further strengthen participation. Countries with well-aligned regulatory frameworks, such as New Zealand, Singapore, and Canada, offer potential avenues for broadening the trial's reach.

According to the company's website, "Xolatryp, is designed to offer cardioprotection by preventing calcium ion overload in heart cells, thereby enhancing patient outcomes. Because heart cells cannot regenerate after death, this approach is critical for recovery".

The company said that in preclinical studies, "Xolatryp provided 86% cardioprotection when administered intravenously over 24 hours, starting 30 minutes post-MI event. Additionally, Xolatryp improved cardiac function and significantly reduced injury-related biomarkers''.

Nyrada was valued at $336.1 million at the close of trade on Wednesday.

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The ASX pharmaceuticals stock is up more than 400% over the last couple of days.

This means that a $10,000 investment would have turned into over $50,000.

Why is this ASX pharmaceuticals stock rocketing?

Firstly, it is important to note that Nyrada is a micro-cap with a market capitalisation of approximately $15 million. It also has a share price of just 9.9 cents.

This means that it doesn't take much to move the needle in percentage terms.

Nevertheless, some positive news has got investors excited this week.

The ASX pharmaceuticals stock announced positive results from its preclinical study evaluating the efficacy of its Brain Injury Program drug candidate NYR-BI03 in preventing secondary brain injury.

According to the release, the study showed a significant neuroprotective signal providing strong evidence of efficacy.

'Significant milestone'

Nyrada's CEO, James Bonnar, believes the results are significant milestone. He commented:

These study results mark a significant milestone in our Brain Injury program, providing strong evidence that our drug candidate NYR-BI03 has the potential to protect the brain from secondary injury. The magnitude of rescue achieved in this study is a compelling outcome and signals a significant therapeutic and market opportunity.

This work is critical for our development pathway for NYR-BI03, giving us confidence as we advance it through to GLP safety and toxicology studies ahead of a first-in-human clinical trial currently planned to commence in the second half of this calendar year.

Subject to the successful completion of GLP studies, the company plans to commence a Phase I human clinical trial for NYR-BI03. The target commencement is the second half of the 2024 calendar year.

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