Anatara Lifesciences (ASX:ANR) Chairman, Dr Mel Bridges discusses Detach, a new natural treatment for scour and gastrointestinal disease
Anatara Lifesciences (ASX:ANR) has developed a natural alternative to antibiotics. So this is a compound or a series of compounds that are extracted out of the pineapple stem, so the root system of the pineapple, which is a waste product. What we’ve found and we’ve developed a patented position around is a series of compounds, which what I would call, is a Teflon coating for the gut.
So what it does, so the way bacteria viruses and parasites work, is they attach to the gut and therefore, cause diarrhoea, gastro, all sorts of different diseases - coughs, colds, viral infections. So if you can block that attachment site, which is what our compound does, then those bugs pass straight through the system unaffected. And you don’t build antibiotic resistance, which is a huge – the rise of the superbugs and the fact that humans are developing antibiotic resistance now, is a huge issue. And what Anatara has, is a natural answer to that problem.
Viruses, bacteria and parasites by nature, they’ve been around since the dawn of time. They have genetically mutated and continue to genetically mutate, against antibiotics. So anything that they’re attacked by, they react to, they mutate and so antibiotics are becoming irrelevant. This is in the news, if not daily, certainly weekly worldwide about the incidence. We’ve literally got hundreds of millions of people around the world now die from antibiotic-resistant superbugs.
In fact, what a lot of people don’t realise is that one in five children around the world, under the age of five, die from bacterial related diseases, because of this antibiotic resistance. So what we have is a natural alternative to that. So as I said, it’s a Teflon coating for the gut, these things just pass straight through unaffected and they don’t mutate.
This year in August/September, we will be submitting a dossier to the Therapeutic Goods Administration and the APVMA, which is the animal health variant of the TGA, for approval for the core compound. This is initially for livestock, because what a lot of people don’t appreciate what I spoke about earlier, about the rise of superbugs. Every time you eat chicken, every time you eat pork and in some cases, every time you eat beef, if you’re a meat eater, you are unbeknownst to you ingesting antibiotics, because animal health companies have been feeding livestock antibiotics. Not to treat disease, but as a growth promotant.
This has now been outlawed in a lot of European countries. It’s now as we speak, being outlawed in the United States, starting with California just passed legislation to ban the use of antibiotics in livestock, and so there’s a groundswell. And you’ve got companies like McDonalds, Subway, Kentucky Fried Chicken, Tyson Foods and the list goes on that have now come out in the media and said: we will not purchase meat if that livestock has been fed antibiotics.
We have the one single natural answer to the use of antibiotics in livestock, therefore, stopping this chain of livestock moving through. So we’ll submit our dossier in August/September this year for approval. We will launch our first product into livestock in Australia, in 2017. And we have signed an option agreement with the world’s number one animal health company, for licence rights to take Detach worldwide for us.
Whilst we’re not able to disclose the upfront payment, the initial upfront payment, not the last one, the upfront payment from Zoetis Inc. (NYSE:ZTS), to hold exclusive rights on Detach for livestock, not for humans. I mean we also have plans to move obviously into the human area, particularly over the counter. So what analysts noticed in our last Quarterly 4C that we posted, our cash jumped by $2.25 million and people joined the dots. So why did the cash go from $12 million to $14.25 in the space of a matter of weeks? So people have joined the dots, and thought oh well that must be the first upfront payment, for just holding the rights. So we haven’t done a full licence agreement, that’ll be a hell of a lot more money.
So in fact this year, we’re not a high cash burn company, so in fact we’re cash flow neutral to almost cash flow positive now, because of that payment. And certainly with the launch of Detach next year, so we would expect to be cash flow positive through 2017. So the fact that we’ve only listed less than two years ago as a lifesciences company, you’d appreciate normally that shareholders don’t see any cash for quite a while. During the IPO, I made the statement to the market I expect to be returning money to shareholders. Whether that’s through special dividends or dividend partly franked, fully franked dividend yields, certainly within five years or maybe earlier than that.
I would like to see the company cash flow positive. I would like to see the company having launched its animal health alternative, natural alternative to antibiotics for livestock production, at least in Australia and certainly through Asia. And I’d like to see the company launching a product into the human area, over the counter, for the treatment of a whole host of gastrointestinal diseases, and also as a traveller’s preventative. So it not only prevents diseases or complaints such as diarrhoea, it not only prevents it, but if you do have it, it also treats it. So it’s a very interesting double whammy. That’s where I’d like to see the company.