SMALL CAPS: Shield Therapeutics revitalizes with new iron deficiency drug

Is the tide turning? Shield Therapeutics?

Judging by this week’s news, the answer is a cautious “yes.”

Shield is a rarity for AIM: a drug development company that has had a breakthrough, that is, successfully developed a commercial drug.

Its innovative treatment for iron deficiency appears to be gaining very healthy market traction in the U.S., where sales rose 69 percent quarter-over-quarter to $6.9 million and increased 259 percent year-over-year.

Total prescriptions rose 26 percent, while the average price was $171, up from $118 a year ago.

Financially, the group also appears to be in good shape, with $8.1 million on its balance sheet and another $5.7 million to be raised from a major monetisation deal. All told, that amounts to around two-thirds of Shield’s current market cap.

Good news, yes. But there was also the small matter of CEO Greg Madison immediately resigning from his position to be replaced by one of the group’s non-executive directors on an interim basis.

With shares up more than 30 percent during the trading week, it appears investors were willing to overlook Madison’s hasty exit.

As for the broader market, the AIM All Share had one of its least impressive weeks, albeit with low volumes. The index lost 1.2 percent to trade at 775.05.

Atom (up 41 percent) was boosted by a framework agreement to sell all the fertilizer it will produce at a project in Paraguay to a Norwegian crop nutrition group called Yara International. The deal provides commercial comfort to potential financiers of ATOME’s project.

The biggest increase, more than 80 percent, was UK oil and gaswhich, according to documents filed with the stock exchange, has a new investor who has built a 12.81 percent stake through Shore Capital Stockbrokers.

A brief announcement had a big impact on shares of Skinbiotherapeutics (up 36 percent), the life sciences group that, believe it or not, focuses on skin. It also had a ripple effect for Optibiotix (up 27 percent), the gut health group that owns a 25 percent stake in SBTX.

The exchange letter in question revealed that SBTX had closed a £5 million convertible bond facility after having drawn down around £1.6 million.

The past year has been good for investors in Scan cellthe immuno-oncology group whose shares have risen 46 percent in that period.

This week, it revealed that it had hired a group of melanoma experts to help plan and design its clinical trial. What really excited the market was the level of interest generated by its technology at ASCO, a conference that attracts the world’s cancer experts. The stock ended the week up 8%.

Continuing in the drug development sector, but moving down to Aquis, the growth stock incubator, Ananda Developments is a standout. Its share price has almost doubled in just over six weeks.

Ananda is developing a CBD-derived treatment for chronic pain that is undergoing a rigorous clinical trial process.

CEO Melissa Sturgess told Proactive she had noticed a better and growing understanding of Ananda’s story, and particularly its lead asset, MRX1.

He also noted that Ananda has managed to attract some heavyweight talent, including non-executive Clive Page, a driving force behind British success story Verona Pharma, and pharmaceutical sector veteran Trevor Jones, who joins the newly established scientific advisory board.

Of course, the peak came when preclinical data revealed its potential efficacy in cardiac fibrosis and heart failure.

On those who fall. Aptamer groupThe research and diagnostics specialist ended the hype around the stock by launching a £2.8m fundraising campaign by selling shares at a deep discount, wiping out two-thirds of the valuation.

VersaryThe non-materials group fell by 43 per cent after reaching a value of £500,000.

They were among five smaller companies that rushed to raise funds before the annual summer lull.

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