Ocean Biomedical, Inc. (NASDAQ: OCEA) is a biopharmaceutical company focused on clinical programs in oncology, fibrosis, infectious disease, and inflammation. Its business model involves partnerships with scientists, research universities, and medical centers for developing and commercializing their discoveries.
Ocean Biomedical works to solve unmet medical needs by accelerating the translation of new discoveries into breakthrough medicines. The company, which has a broad pipeline with multiple formulations at various stages of development, became a public entity in February 2023. It has an impressive track record of successfully taking drug candidates from the trial stage to approval.
In recent years, the pharmaceutical market grew at an accelerated pace and the trend is expected to continue in the near future. It is estimated that the oncology market would grow at a compound annual rate of 8% by 2030, while the fibrosis and antimalarial drug markets are expected to expand by 7% and 4% respectively by 2027.
The Company
Ocean Biomedical was founded by Chirinjeev Kathuria, Jack Elias, and Jonathan Kurtis in 2019. Headquartered in Providence, Rhode Island, the company is led by chief executive officer Elizabeth Ng. Gurinder Karla is the chief financial officer. Its core portfolio is focused on the critical areas of oncology, pulmonary fibrosis, and infectious disease. The company is on track to move certain preclinical product candidates in its programs into the clinic in the coming months.
It has three wholly owned subsidiaries – Oncology Company, Fibrosis Company, and Infectious Disease Company. The oncology and fibrosis franchises are licensed from Brown University, while the infectious diseases franchise is licensed from Rhode Island Hospital. Diversification of the portfolio helps the business optimize value creation and mitigate risks. Inventors and research organizations retain 20% interest in their discoveries, and the company would acquire the remaining 80% by meeting future research & development and general & administrative expenses. Ocean Biomedical outsources and uses third-party facilities for research and clinical trials since it does not own research facilities.
IPO
Ocean Biomedical made its stock market debut on February 15, 2023, when its shares started trading on the Nasdaq stock exchange under the symbol OCEA. It was done through a reverse merger of special purpose acquisition company Aesther Healthcare Acquisition Corp. The company has a market cap of about $178 million.
Financials
For the quarter that ended in September 2022, the company reported a net loss of $1.02 million or $0.10 per share, compared to a loss of $ 42,545 in the comparable period of 2021. Operating costs totaled $1.37 million during the three-month period. It had total cash of $472,105 at the end of the quarter, and assets worth $109 million.
Pipeline
Ocean Biomedical is developing three programs based on discoveries of novel, first-in-class biological targets. Each program has the potential for multiple indications. The programs are — cancer immunotherapy program with the potential for use in a broad array of visceral cancers, from prostate cancer to lung cancer to glioblastoma; fibrosis therapeutic program with the potential to address multiple fibrotic diseases from idiopathic pulmonary fibrosis to alcoholic liver disease to scleroderma; and malaria/infectious disease program, which has led to breakthrough vaccine and therapeutic candidates for the prevention and treatment of malaria.
The company has three drug candidates for cancer prevention, one for fibrosis and three for malaria, which are at advanced stages of IND-enabling studies. In oncology, Ocean Biomedical is targeting non-small cell lung cancer and glioblastoma multiforme. Studies have revealed that the antibodies developed by the company against cancer-causing CHI3L1 significantly reduce tumors. It has also been found that the company’s OCF-203 reduces fibrosis by preventing Chit1. For Malaria treatment, studies showed that Ocean Biomedical’s ODA-570 mRNA vaccine has the potential to kill 90% of malaria parasites.
Updates
In the past few months, especially after the stock market debut in mid-February, Ocean Biomedical achieved several milestones in its drug-development programs, including the receipt of patents for its novel malaria vaccine target and cancer immunotherapy treatment. In April, the company’s scientific co-founder Dr. Jonathan Kurtis received a Notice of Allowance from the United States Patent and Trademark Office for his patent application covering a therapeutic and prophylactic monoclonal antibody that kills falciparum malaria parasites.
Also, Ocean Biomedical secured $134 million in financial backing from investment institutions for its research and Investigational New Drug Application filing. More recently, the company found a place in the preliminary list of index additions posted by FTSE Russell. It will be added to the Russell 2000 Index effective June 26, 2023, after the US market opens.
Conclusion
The primary challenge facing companies engaged in the development and commercializing of drug candidates is the ongoing uncertainties in the pharmaceutical industry. Ocean Biomedical is not immune to the growing competition the healthcare market is witnessing, despite its innovative business model. The main hassle for the company to expand the business is its limited operating experience — it is yet to generate revenue due to the absence of marketable products.