Dr Boreham’s Crucible: Race Oncology

Small Caps | Apr 09 2024

By Tim Boreham

ASX code: Race Oncology ((RAC))

Shares on issue: 164,778,179

Market cap: $237.3m

Financials (December half 2023): revenue nil, loss of -$5.66m (-$4.41m deficit previously), cash of $13.7m (down -48%). During the period the company received a $4m research and development tax incentives and $461,428 in interest

CEO: Dr Daniel Tillett

Board: Mary Harney (chairman), Dr Pete Smith, Phillip Lynch (Dr John Cullity resigned in August 2023)

Major identifiable shareholders: Dr Daniel Tillett 9.9%, Dr John Cullity 4.1%, Phillip Richard Perry 3.7%, Mark Juan 3.5%, Merchant Opportunities Fund 2.7%

The home of the repurposed cancer drug bisantrene, Race Oncology has been settling down after doing some ‘repurposing’ of its own - management-wise.

In August last year new CEO Damian Clarke-Bruce described the company’s quest for a new “North Star”: pursuing an oncology program based on its lead indication metastasized breast cancer (MBC).

For the navigationally challenged, a North Star symbolizes direction, guidance, stability and purpose - due to its fixed position relative to other stars.

Two weeks later Mr Clarke-Bruce – appointed only in February of that year - was gone and the company was consulting its compass again.

The befuddling strategy revamp saw the return of Dr Daniel Tillett, the company’s biggest shareholder and former chief scientific officer, as CEO. Dr Tillet in effect runs the company with Dr Peter Smith, who has changed from non-executive to executive director.

Amid the upheaval, the new – or perhaps that old – guard maintains that the Race story essentially remains the same: developing bisantrene as a cardio-protective tool to enhance the efficacy of existing cancer drugs.

A key change is that the intended metastasized breast cancer trial has changed from an envisaged US program to a local study of broader solid cancers.

Race is also pursuing a treatment for acute myeloid leukaemia (AML).

“[The strategy] is evolution, not revolution,” Dr Tillett says.

Pimping up an old drug

Race was founded in 2013 when US physician and entrepreneur Dr William Garner reviewed medical literature about bisantrene, which was approved by French authorities for acute myeloid leukaemia (AML) in 1988.

AML is an aggressive cancer, with only one-third of patients surviving beyond a year.

The drug was developed in the 1980s by French group Lederle Laboratories as an anthracycline - a chemo-therapeutic – but without the common cardio-toxicity that results in many cancer patients dying of heart failure.

Extensive clinical trials covering 1,800 patients in 46 trials confirmed both the drug’s cardio-protective and anti-tumor activities.

Lederle was taken over by American Cyanamid, which had no interest in the drug.

Bisantrene ended up in the hands of the Nevada-incorporated Update Pharma, owned by Dr Garner, pharmaceutical scientist Dr John Rothman and Dr Peter Molloy (see below).

Race listed in July 2016 via a resources company shell, raising $4.3m at 20c apiece.

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