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Gather ’round the crystal ball: A multi-commodity outlook from PDAC 2024

Gather intel from executives behind six prospective mining stocks across six strategic commodities featured at PDAC 2024 in Toronto.
The post Gather ’round…



TORONTO – Mining stocks, especially those in the exploration and development stage, are in the midst of a prolonged dip in sentiment, with many high-quality names down by more than 75 per cent from all-time-highs, despite global inflation having pushed commodities up over the past five years.

It is these same inflationary forces, borne out of the world’s re-emergence after COVID-19, that have pushed investors away from small-cap and micro-cap mining stocks, regardless of asset or operational quality, in exchange for the peace of mind of 3-4 per cent bond or savings yields, the highest since the 1990s, or owning physical commodities for their value preservation properties.

Core from Canada Nickel Company’s booth at PDAC 2024.

The current environment is the most propitious to invest in junior miners since the mid-2000s, leading into the Great Financial Crisis, when the S&P 500 and TSX Index were almost cut in half, unleashing a flight to safety in gold and silver that propelled the metals to all-time-highs.

Hundreds of companies that fit this thesis were in attendance this week at PDAC 2024, the Prospectors and Developers Association of Canada’s yearly convention to celebrate and expand Canada’s mineral resource industry. The convention – which ran from Sunday to Wednesday at the Metro Toronto Convention Centre – showcased enticing assets and experienced management teams from around the world, the majority of which have posted unjustifiably poor stock performances that should be ringing bells and whistles in value investors’ heads.

Stockhouse compiled commodity outlooks from six such companies in attendance, whose bright futures across gold, silver, lithium, nickel, copper and uranium represent a robust, untapped opportunity for investors keen to diversify into the junior mining space.

Founders Metals

Founders Metals (TSXV:FDR) is developing its flagship 20,000-ha Antino gold project in Suriname. The company has posted high-grade results from Antino since optioning the project in 2021 – most recently highlighted by 19 m of 14.23 g/t gold, 15 m of 8.18 g/t gold and 26 m of 5.52 g/t gold, and the discovery of a new gold zone in February – dazzling shareholders with a more than 397.22 per cent return year-over-year as of Thursday.

Founders is keen on continuing its track record of shareholder value, an outlier among the companies profiled in this article, with a fully financed 2024 drill program for up to 30,000 m, and an initial resource estimate with multi-million-ounce potential tentatively slated for Q2 2025.

Commodity outlook: Gold

Pascal Voegeli, Founders’ vice president of exploration, joined Stockhouse from the floor at PDAC 2024, commenting that “many of the macro fundamentals for gold are finally coming together. We’re probably going to see a weakening in interest rates soon, which should be a major catalyst for price action, especially after we just surpassed the US$2,100 per ounce threshold and retail is starting to re-enter the market. Possible recessionary influences and 2023 being the largest in terms of central bank purchases also play in gold’s favour.”

“Another supporting aspect is that a lot of the world’s major gold mines are nearing depletion,” he added, “and there’s been a massive deficit in exploration spending over the past 10 years, pointing to how this finally might be a time when gold prices translate into the junior stock market.”

Dolly Varden Silver

Dolly Varden Silver (TSXV:DV) is developing its Kitsault Valley project in British Columbia’s Golden Triangle, which houses the high-grade silver and gold resources of Dolly Varden and Homestake Ridge, and is considered prospective for more precious metal deposits.

The project resides in the same geology as numerous other on-trend, high-grade deposits, including Eskay Creek and Brucejack, in an area that has seen more than $5 billion in M&A since 2018. The project is also home to the Big Bulk property, which indicates the presence of porphyry and skarn-style copper and gold mineralization.

Kitsault‘s latest mineral resource estimate stands at 34,731,000 indicated silver ounces, 165,993 indicated gold ounces, 29,277,000 inferred silver ounces, and 816,719 inferred gold ounces, with recent high-grade drilling likely to increase mineral inventories for the next estimate.

The company is also 84 per cent owned by institutions and other companies, with a further 9 per cent with Eric Sprott, who is an institution all on his own, significantly de-risking the asset and management team for potential investors.

Dolly Varden’s stock, down by more than 40 per cent since 2014, has wallowed in obscurity, following silver’s relatively flat return over the period. But with silver entering its fourth-consecutive year in a deficit, and a new C$15 million financing backed by Sprott to propel further exploration, shares are nearing a critical mass in terms of untapped upside.

Commodity outlook: Silver

Diana Zoppa, head of corporate communications for Dolly Varden, told Stockhouse that “my outlook for silver has been the same since my dad told me they went off the gold standard in the 1970s and everything was going to hell in a hand basket. It’s real money, a store of wealth, and I think it’s prudent for investors to accumulate bullion contingent on their financial goals and risk tolerance. I think we’re at the beginning of a stellar bull market astronomically greater than any we’ve ever seen because global debt and currency devaluation are astronomically greater than we’ve ever seen. Central banks created hyper-inflation by overprinting fiat currency, we’ve seen banks failing and problems in the derivatives markets, and silver, for me, is insurance against that.”

Critical Elements Lithium

Critical Elements Lithium (TSXV:CRE) is developing its flagship Rose lithium-tantalum project in Quebec, which features probable reserves of 26.8 million tonnes at 0.96 per cent Li2O equivalent, or 0.85 per cent Li2O and 133 ppm tantalum pentoxide (Ta2O5).

A 2023 feasibility study supports Rose’s 17-year mine life, an after-tax NPV8% of US$2.195 billion, and an after-tax internal rate of return of 65.7 per cent, with average assumptions of US$4,699 per tonne of technical-grade lithium concentrate, US$2,162 per tonne of chemical-grade lithium concentrate, and US$150 per kg of Ta2O5. The price for a tonne of lithium averaged about US$3,800 in 2023, and is expected to continue falling until 2025, when demand should catch up with an expected surplus in supply and resume course to doubling by 2030.

Rose will average more than 200,000 tonnes of spodumene production per year, with ongoing exploration set to grow that number with more high-grade discoveries, guided by a chief executive officer who has been with the company since 2009.

Shares of Critical Elements Lithium have given back more than 75 per cent from their all-time-high in early 2023, serving up a potentially lucrative entry point as initial production at Rose ramps up in 2026.

Commodity outlook: Lithium

Eric Zaunscherb, chairman of Critical Elements Lithium, joined Stockhouse from the company’s booth at PDAC 2024 to weigh in on the state of the global lithium market.

“Obviously, we’ve seen a big contraction in lithium prices. A big reason behind this is how the industry in indexed. Because there’s a lack of transparency in the industry, with most lithium being transacted on a contract basis, the spot prices that people see aren’t representative. We’re also seeing a lot of de-stocking in the industry, particularly of lower-quality product in China, with the intention of driving the price of lithium down and minimizing competition. All of this leads to a very opaque market on the supply side.

“On the demand side, the media focuses on the pullbacks we’re seeing, particularly in North American OEMs. But the reality is that we’re seeing other OEMs, especially in China, grabbing market share. I would suggest to you that growth is still extremely strong for EV demand, with massive downstream investments and off-take agreements to lock in lithium feed moving forward.”

Canada Nickel Company

Canada Nickel Company (TSXV:CNC) offers exposure to nickel-sulphide projects aiming to supply the growing stainless steel and electric vehicle markets. The company’s flagship Crawford nickel-cobalt sulphide project in the Timmins nickel district boasts a bankable feasibility study supporting a US$2.6 billion NPV8%, free cash flow of US$546 million during its 27-year peak period, and total production of 1.6 million tonnes (Mt) of nickel, 58 Mt of iron, and 2.8 Mt of chrome over a 41-year project life. This makes Crawford the second-largest nickel reserve and second-largest nickel resource in the world.

The company anticipates to receive final permits for Crawford in 2025, followed by construction in 2026, and first production in 2027.

Canada Nickel owns multiple properties in the district, 11 of which have a larger footprint than Crawford with the same host mineralization. Recent highlights from these secondary opportunities include discoveries at its Mann Central and Mann Northwest.

Backed by C$35 million in flow-through capital, management with deep mining financing and nickel exploration experience, and major investors, including Agnico Eagle (11 per cent), Samsung SDI (8.7 per cent) and Anglo American (7.6 per cent), the small-cap miner is on track to capitalize on its expectation that nickel demand will double by 2030 to more than 5 Mt per year, according to its corporate deck.

Shares of Canada Nickel are up by only 64.44 per cent since inception in 2020, just ahead of nickel‘s approximately 42 per cent gain over the period.

Commodity outlook: Nickel

Steve Balch, Canada Nickel’s vice president of exploration, commented that his company is “very bullish on the price of nickel, despite its recent pullback, because there is huge demand and an overestimation of supply in both China and Indonesia. The nickel market is growing at roughly 9 per cent per year, and we expect that to continue as many existing projects are starting to shut down.”

“Canada Nickel has budgeted for between 90,000-100,000 m of drilling in 2024,” he said, “with the goals of delineating seven new resources known to contain nickel, making seven new discoveries, and better positioning the company to meet EV and stainless steel demand.”

Western Copper and Gold

Western Copper and Gold (TSX:WRN) has been focused on bringing its Casino Project in the Yukon into production since 2008, a timeframe that speaks to the thoroughness of Canadian mining laws, as well as the vastness of the undertaking. Casino will be Canada’s largest critical minerals mine once extraction gets underway, including 7.6 billion pounds of copper measured and indicated and more than 3.1 billion pounds of copper inferred, and 14.8 million ounces of gold measured and indicated and more than 6.3 million ounces inferred, representing more than 80 years of combined supply.

Casino is estimated to yield C$10 billion in after-tax cash flow over its 27-year life, according to a 2022 feasibility study, at conservative base-cases prices of US$3.60 per pound of copper and US$1,700 per ounce of gold, which represent 7.7 per cent and 21.15 per cent discounts, respectively, from Thursday prices on Trading Economics.

Western Copper and Gold has established a responsible development track record at Casino (slide 40) since the initial acquisition, and the company is equipped to continue it with ongoing permitting efforts, supported by investments and expertise from mining heavyweights Rio Tinto and Mitsubishi, steadily growing copper demand through 2035, a long-tenured management team, and a new chief executive officer, Sandeep Singh, who oversaw 19 producing assets as president and chief executive officer of Osisko Gold Royalties.

The Casino project’s demonstrated value has yet to be reflected in WRN shares, which have risen by only 120 per cent since the company acquired the project in 2006.

Commodity outlook: Copper

Singh spoke with Stockhouse from Western Copper and Gold’s booth at PDAC 2024, noting that his company sees huge upside in copper and gold prices. “I think that, over the next five to 10 years, there’s going to be a good runway for both commodities. In terms of copper as a critical metal, there aren’t enough projects moving forward around the world to meet demand from decarbonization and electrification, and we’ve seen disturbances in major copper-producing countries such as Chile, Peru and Panama, which have put the supply chain at risk.”

“In terms of gold, when you look at it as a counter to the U.S. dollar, and as a hedge against inflation, I think it’s a safe place to be,” he added. “With gold near all-time-highs, I don’t think the disconnect between stocks and the gold price is sustainable, and that will rectify itself when retail investors decide they want more levered gold exposure in world-class jurisdictions like the Yukon.”

CanAlaska Uranium

CanAlaska Uranium (TSXV:CVV) is active across a 500,000-hectare exploration portfolio in Canada’s Athabasca Basin, the world’s leading source of high-grade uranium, which produced more than 900 million pounds of high-grade triuranium octoxide since 1975, houses known resources of 606,600 tonnes, and offers ample room for further exploration. CanAlaska’s properties including the high-grade West McArthur joint venture with Cameco and Moon Lake South joint venture with Denison Mines, as well as high-potential prospects for nickel, copper, gold and diamonds.

The company has an aggressive drilling program planned for 2024 across five properties, with a highlight intersection of 16.8 m of 13.75 per cent uranium at West McArthur released on Feb. 28. It has paired ongoing exploration with an equally aggressive asset expansion plan, with three letters of intent and a property swap announced over the past two months.

With the spot price of uranium up by 86.27 per cent year-over-year and by almost 400 per cent since 2019, and demand for the alternative fuel source expected to double by 2040 amid an ongoing deficit, CVV shares’ 144 per cent return since 2019 has a lot of room to run as the company develops one of the largest portfolios in the basin.

Commodity outlook: Uranium

Cory Belyk, CanAlaska’s president and chief executive officer, joined Stockhouse to close out our commodity outlook roundup by shedding light on the future of uranium.

“My expectation is pretty simple,” he said, “it’s that we’re entering a whole new phase of nuclear build-out on a global scale across multiple decades because of smart modular reactor technology, including Microsoft’s new nuclear division, and I expect the price of uranium to stay high and move higher as new projects come online.”

“Concurrently,” he added, “CanAlaska shareholders can look forward to more assays and drill holes from our confirmed discovery at West McArthur over the next one to two months as we prepare to uncover new discoveries during the summer drilling season.”

Join the discussion: Find out what everybody’s saying about mining stocks and commodity outlooks on the Founders Metals, Dolly Varden Silver, Critical Elements Lithium, Canada Nickel Company, Western Copper and Gold and CanAlaska Uranium Bullboards, and Stockhouse’s stock forums and message boards.

The material provided in this article is for information only and should not be treated as investment advice. For full disclaimer information, please click here. 

The post Gather ’round the crystal ball: A multi-commodity outlook from PDAC 2024 appeared first on The Market Online Canada.

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EyePoint poaches medical chief from Apellis; Sandoz CFO, longtime BioNTech exec to retire

Ramiro Ribeiro
After six years as head of clinical development at Apellis Pharmaceuticals, Ramiro Ribeiro is joining EyePoint Pharmaceuticals as CMO.



Ramiro Ribeiro

After six years as head of clinical development at Apellis Pharmaceuticals, Ramiro Ribeiro is joining EyePoint Pharmaceuticals as CMO.

“The retinal community is relatively small, so everybody knows each other,” Ribeiro told Endpoints News in an interview. “As soon as I started to talk about EyePoint, I got really good feedback from KOLs and physicians on its scientific standards and quality of work.”

Ribeiro kicked off his career as a clinician in Brazil, earning a doctorate in stem cell therapy for retinal diseases. He previously held roles at Alcon and Ophthotech Corporation, now known as Astellas’ M&A prize Iveric Bio.

At Apellis, Ribeiro oversaw the Phase III development, filing and approval of Syfovre, the first drug for geographic atrophy secondary to age-related macular degeneration (AMD). The complement C3 inhibitor went on to make $275 million in 2023 despite reports of a rare side effect that only emerged after commercialization.

Now, Ribeiro is hoping to replicate that success with EyePoint’s lead candidate, EYP-1901 for wet AMD, which is set to enter the Phase III LUGANO trial in the second half of the year after passing a Phase II test in December.

Ribeiro told Endpoints he was optimistic about the company’s intraocular sustained-delivery tech, which he said could help address treatment burden and compliance issues seen with injectables. He also has plans to expand the EyePoint team.

“My goal is not just execution of the Phase III study — of course that’s a priority — but also looking at the pipeline and which different assets we can bring in to leverage the strength of the team that we have,” Ribeiro said.

Ayisha Sharma

Remco Steenbergen

Sandoz CFO Colin Bond will retire on June 30 and board member Remco Steenbergen will replace him. Steenbergen, who will step down from the board when he takes over on July 1, had a 20-year career with Philips and has held the group CFO post at Deutsche Lufthansa since January 2021. Bond joined Sandoz nearly two years ago and is the former finance chief at Evotec and Vifor Pharma. Investors didn’t react warmly to Wednesday’s news as shares fell by almost 4%.

The Swiss generics and biosimilars company, which finally split from Novartis in October 2023, has also nominated FogPharma CEO Mathai Mammen to the board of directors. The ex-R&D chief at J&J will be joined by two other new faces, Swisscom chairman Michael Rechsteiner and former Unilever CFO Graeme Pitkethly.

On Monday, Sandoz said it completed its $70 million purchase of Coherus BioSciencesLucentis biosimilar Cimerli sooner than expected. The FDA then approved its first two biosimilars of Amgen’s denosumab the next day, in a move that could whittle away at the pharma giant’s market share for Prolia and Xgeva.

Sean Marett

BioNTech’s chief business and commercial officer Sean Marett will retire on July 1 and will have an advisory role “until the end of the year,” the German drugmaker said in a release. Legal chief James Ryan will assume CBO responsibilities and BioNTech plans to name a new chief commercial officer by the end of the month. Marett was hired as BioNTech’s COO in 2012 after gigs at GSK, Evotec and Next Pharma, and led its commercial efforts as the Pfizer-partnered Comirnaty received the first FDA approval for a Covid-19 vaccine. BioNTech has also built a cancer portfolio that TD Cowen’s Yaron Werber described as “one of the most extensive” in biotech, from antibody-drug conjugates to CAR-T therapies.

Chris Austin

→ GSK has plucked Chris Austin from Flagship and he’ll start his new gig as the pharma giant’s SVP, research technologies on April 1. After a long career at NIH in which he was director of the National Center for Advancing Translational Sciences (NCATS), Austin became CEO of Flagship’s Vesalius Therapeutics, which debuted with a $75 million Series A two years ago this week but made job cuts that affected 43% of its employees six months into the life of the company. In response to Austin’s departure, John Mendlein — who chairs the board at Sail Biomedicines and has board seats at a few other Flagship biotechs — will become chairman and interim CEO at Vesalius “later this month.”

BioMarin has lined up Cristin Hubbard to replace Jeff Ajer as chief commercial officer on May 20. Hubbard worked for new BioMarin chief Alexander Hardy as Genentech’s SVP, global product strategy, immunology, infectious diseases and ophthalmology, and they had been colleagues for years before Hardy was named Genentech CEO in 2019. She shifted to Roche Diagnostics as global head of partnering in 2021 and had been head of global product strategy for Roche’s pharmaceutical division since last May. Sales of the hemophilia A gene therapy Roctavian have fallen well short of expectations, but Hardy insisted in a recent investor call that BioMarin is “still very much at the early stage” in the launch.

Pilar de la Rocha

BeiGene has promoted Pilar de la Rocha to head of Europe, global clinical operations. After 13 years in a variety of roles at Novartis, de la Rocha was named global head of global clinical operations excellence at the Brukinsa maker in the summer of 2022. A short time ago, BeiGene ended its natural killer cell therapy alliance with Shoreline Biosciences, saying that it was “a result of BeiGene’s internal prioritization decisions and does not reflect any deficit in Shoreline’s platform technology.”

Andy Crockett

Andy Crockett has resigned as CEO of KalVista Pharmaceuticals. Crockett had been running the company since its launch in 2011 and will hand the keys to president Ben Palleiko, who joined KalVista in 2016 as CFO. Serious safety issues ended a Phase II study of its hereditary angioedema drug KVD824, but KalVista is mounting a comeback with positive Phase III results for sebetralstat in the same indication and could compete with Takeda’s injectable Firazyr. “If approved, sebetralstat may offer a compelling treatment option for patients and their caregivers given the long-standing preference for an effective and safe oral therapy that provides rapid symptom relief for HAE attacks,” Crockett said last month.

Steven Lo

Vaxart has tapped Steven Lo as its permanent president and CEO, while interim chief Michael Finney will stay on as chairman. Endpoints News last caught up with Lo when he became CEO at Valitor, the UC Berkeley spinout that raised a $28 million Series B round in October 2022. The ex-Zosano Pharma CEO had a handful of roles in his 13 years at Genentech before his appointments as chief commercial officer of Corcept Therapeutics and Puma Biotechnology. Andrei Floroiu resigned as Vaxart’s CEO in mid-January.

Kartik Krishnan

Kartik Krishnan has taken over for Martin Driscoll as CEO of OncoNano Medicine, and Melissa Paoloni has moved up to COO at the cancer biotech located in the Dallas-Fort Worth suburb of Southlake. The execs were colleagues at Arcus Biosciences, Gilead’s TIGIT partner: Krishnan spent two and a half years in the CMO post, while Paoloni was VP of corporate development and external alliances. In 2022, Krishnan took the CMO job at OncoNano and was just promoted to president and head of R&D last November. Paoloni came on board as OncoNano’s SVP, corporate development and strategy not long after Krishnan’s first promotion.

Genesis Research Group, a consultancy specializing in market access, has brought in David Miller as chairman and CEO, replacing co-founder Frank Corvino — who is transitioning to the role of vice chairman and senior advisor. Miller joins the New Jersey-based team with a number of roles under his belt from Biogen (SVP of global market access), Elan (VP of pharmacoeconomics) and GSK (VP of global health outcomes).

Adrian Schreyer

Adrian Schreyer helped build Exscientia’s AI drug discovery platform from the ground up, but he has packed his bags for Nimbus Therapeutics’ AI partner Anagenex. The new chief technology officer joined Exscientia in 2013 as head of molecular informatics and was elevated to technology chief five years later. He then held the role of VP, AI technology until January, a month before Exscientia fired CEO Andrew Hopkins.

Paul O’Neill has been promoted from SVP to EVP, quality & operations, specialty brands at Mallinckrodt. Before his arrival at the Irish pharma in March 2023, O’Neill was executive director of biologics operations in the second half of his 12-year career with Merck driving supply strategy for Keytruda. Mallinckrodt’s specialty brands portfolio includes its controversial Acthar Gel (a treatment for flares in a number of chronic and autoimmune indications) and the hepatorenal syndrome med Terlivaz.

David Ford

→ Staying in Ireland, Prothena has enlisted David Ford as its first chief people officer. Ford worked in human resources at Sanofi from 2002-17 and then led the HR team at Intercept, which was sold to Italian pharma Alfasigma in late September. We recently told you that Daniel Welch, the former InterMune CEO who was a board member at Intercept for six years, will succeed Lars Ekman as Prothena’s chairman.

Ben Stephens

→ Co-founded by Sanofi R&D chief Houman Ashrafian and backed by GSK, Eli Lilly partner Sitryx stapled an additional $39 million to its Series A last fall. It has now welcomed a pair of execs: Ben Stephens (COO) had been finance director for ViaNautis Bio and Rinri Therapeutics, and Gordon Dingwall (head of clinical operations) is a Roche and AstraZeneca vet who led development operations at Mission Therapeutics. Dingwall has also served as a clinical operations leader for Shionogi and Freeline Therapeutics.

Steve Alley

MBrace Therapeutics, an antibody-drug conjugate specialist that nabbed $85 million in Series B financing last November, has named Steve Alley as CSO. Alley spent two decades at Seagen before the $43 billion buyout by Pfizer and was the ADC maker’s executive director, translational sciences.

→ California cancer drug developer Apollomics, which has been mired in Nasdaq compliance problems nearly a year after it joined the public markets through a SPAC merger, has recruited Matthew Plunkett as CFO. Plunkett has held the same title at Nkarta as well as Imago BioSciences — leading the companies to $290 million and $155 million IPOs, respectively — and at Aeovian Pharmaceuticals since March 2022.

Heinrich Haas

→ Co-founded by Oxford professor Adrian Hill — the co-inventor of AstraZeneca’s Covid-19 vaccine — lipid nanoparticle biotech NeoVac has brought in Heinrich Haas as chief technology officer. During his nine years at BioNTech, Haas was VP of RNA formulation and drug delivery.

Kimberly Lee

→ New Jersey-based neuro biotech 4M Therapeutics is making its Peer Review debut by introducing Kimberly Lee as CBO. Lee was hired at Taysha Gene Therapies during its meteoric rise in 2020 and got promoted to chief corporate affairs officer in 2022. Earlier, she led corporate strategy and investor relations efforts for Lexicon Pharmaceuticals.

→ Another Peer Review newcomer, Osmol Therapeutics, has tapped former Exelixis clinical development chief Ron Weitzman as interim CMO. Weitzman only lasted seven months as medical chief of Tango Therapeutics after Marc Rudoltz had a similarly short stay in that position. Osmol is going after chemotherapy-induced peripheral neuropathy and chemotherapy-induced cognitive impairment with its lead asset OSM-0205.

→ Last August, cardiometabolic disease player NeuroBo Pharmaceuticals locked in Hyung Heon Kim as president and CEO. Now, the company is giving Marshall Woodworth the title of CFO and principal financial and accounting officer, after he served in the interim since last October. Before NeuroBo, Woodworth had a string of CFO roles at Nevakar, Braeburn Pharmaceuticals, Aerocrine and Fureix Pharmaceuticals.

Claire Poll

Claire Poll has retired after more than 17 years as Verona Pharma’s general counsel, and the company has appointed Andrew Fisher as her successor. In his own 17-year tenure at United Therapeutics that ended in 2018, Fisher was chief strategy officer and deputy general counsel. The FDA will decide on Verona’s non-cystic fibrosis bronchiectasis candidate ensifentrine by June 26.

Nancy Lurker

Alkermes won its proxy battle with Sarissa Capital Management and is tinkering with its board nearly nine months later. The newest director, Bristol Myers Squibb alum Nancy Lurker, ran EyePoint Pharmaceuticals from 2016-23 and still has a board seat there. For a brief period, Lurker was chief marketing officer for Novartis’ US subsidiary.

→ Chaired by former Celgene business development chief George Golumbeski, Shattuck Labs has expanded its board to nine members by bringing in ex-Seagen CEO Clay Siegall and Tempus CSO Kate Sasser. Siegall holds the top spots at Immunome and chairs the board at Tourmaline Bio, while Sasser came to Tempus from Genmab in 2022.

Scott Myers

→ Ex-AMAG Pharmaceuticals and Rainier Therapeutics chief Scott Myers has been named chairman of the board at Convergent Therapeutics, a radiopharma player that secured a $90 million Series A last May. Former Magenta exec Steve Mahoney replaced Myers as CEO of Viridian Therapeutics a few months ago.

→ Montreal-based Find Therapeutics has elected Tony Johnson to the board of directors. Johnson is in his first year as CEO of Domain Therapeutics. He is also the former chief executive at Goldfinch Bio, the kidney disease biotech that closed its doors last year.

Habib Dable

→ Former Acceleron chief Habib Dable has replaced Kala Bio CEO Mark Iwicki as chairman of the board at Aerovate Therapeutics, which is signing up patients for Phase IIb and Phase III studies of its lead drug AV-101 for pulmonary arterial hypertension. Dable joined Aerovate’s board in July and works part-time as a venture partner for RA Capital Management.

Julie Cherrington

→ In the burgeoning world of ADCs, Elevation Oncology is developing one of its own that targets Claudin 18.2. Its board is now up to eight members with the additions of Julie Cherrington and Mirati CMO Alan Sandler. Cherrington, a venture partner at Brandon Capital Partners, also chairs the boards at Actym Therapeutics and Tolremo Therapeutics. Sandler took the CMO job at Mirati in November 2022 and will stay in that position after Bristol Myers acquired the Krazati maker.

Patty Allen

Lonnie Moulder’s Zenas BioPharma has welcomed Patty Allen to the board of directors. Allen was a key figure in Vividion’s $2 billion sale to Bayer as the San Diego biotech’s CFO, and she’s a board member at Deciphera Pharmaceuticals, SwanBio Therapeutics and Anokion.

→ In January 2023, Y-mAbs Therapeutics cut 35% of its staff to focus on commercialization of Danyelza. This week, the company has reserved a seat on its board of directors for Nektar Therapeutics CMO Mary Tagliaferri. Tagliaferri also sits on the boards of Enzo Biochem and is a former board member of RayzeBio.

→ The ex-Biogen neurodegeneration leader at the center of Aduhelm’s controversial approval is now on the scientific advisory board at Asceneuron, a Swiss-based company focused on Alzheimer’s and Parkinson’s. Samantha Budd-Haeberlein tops the list of new SAB members, which also includes Henrik Zetterberg, Rik Ossenkoppele and Christopher van Dyck.

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Deflationary pressures in China – be careful what you wish for

Until recently, China’s decelerating inflation was welcomed by the West, as it led to lower imported prices and helped reduce inflationary pressures….



Until recently, China’s decelerating inflation was welcomed by the West, as it led to lower imported prices and helped reduce inflationary pressures. However, China’s consumer prices fell for the third consecutive month in December 2023, delaying the expected rebound in economic activity following the lifting of COVID-19 controls. For calendar year 2023, CPI growth was negligible, whilst the producer price index declined by 3.0 per cent.

China’s inflation dynamics

China’s inflation dynamics

Chinese consumers are hindered by the weaker residential property market and high youth unemployment. Several property developers have defaulted, collectively wiping out nearly all the U.S.$155 billion worth of U.S. dollar denominated-bonds. 

Meanwhile, the Shanghai Composite Index is at half of its record high, recorded in late 2007. The share prices of major developers, including Evergrande Group, Country Garden Holdings, Sunac China and Shimao Group, have declined by an average of 98 per cent over recent years. Some economists are pointing to the Japanese experience of a debt-deflation cycle in the 1990s, with economic stagnation and elevated debt levels.

Australia has certainly enjoyed the “pull-up effect” from China, particularly with the iron-ore price jumping from around U.S.$20/tonne in 2000 to an average closer to U.S.$120/tonne over the 17 years from 2007. With strong volume increases, the value of Australia’s iron ore exports has jumped 20-fold to around A$12 billion per month, accounting for approximately 35 per cent of Australia’s exports. 

For context, China takes 85 per cent of Australia’s iron ore exports, whilst Australia accounts for 65 per cent of China’s iron ore imports. China’s steel industry depends on its own domestic iron ore mines for 20 per cent of its requirement, however, these are high-cost operations and need high iron ore prices to keep them in business. To reduce its dependence on Australia’s iron ore, China has increased its use of scrap metal and invested large sums of money in Africa, including the Simandou mine in Guinea, which is forecast to export 60 million tonnes of iron ore from 2028.

The Chinese housing market has historically been the source of 40 per cent of China’s steel usage. However, the recent high iron ore prices are attributable to the growth in China’s industrial and infrastructure activity, which has offset the weakness in residential construction.

Whilst this has continued to deliver supernormal profits for Australia’s major iron ore producers (and has greatly assisted the federal budget), watch out for any sustainable downturn in the iron ore price, particularly if the deflationary pressures in China continue into the medium term.

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Deterra Royalties half-yearly result: stable performance and growth Initiatives

Deterra Royalties (ASX:DRR) was established through a strategic demerger from Iluka Resources Ltd (ASX:ILU) in 2020. At the core of Deterra Royalties portfolio…



Deterra Royalties (ASX:DRR) was established through a strategic demerger from Iluka Resources Ltd (ASX:ILU) in 2020. At the core of Deterra Royalties portfolio lies long-life, Mining Area C (MAC), a premier iron ore mining operation in the Pilbara region of Western Australia, operationally managed by BHP. This key asset is underpinned by a royalty agreement that ensures Deterra Royalties receives quarterly payments equivalent to 1.232 per cent of the revenue generated, alongside substantial one-off payments of A$1 million for each dry metric tonne increase in annual production capacity. 

South flank, a critical component of the MAC, exemplifies BHP’s latest advancement in iron ore mining, marking its inaugural production in May 2021. In financial year 2023, MAC annual iron ore production amounted to 126 million wet metric tonnes, up 14 per cent on the prior year. The company has reiterated that capacity payments have been set at 118 million tonnes last year and are expected to be updated to current production of 126 million tonnes in June 2024, with potential upside to 145 million tonnes shortly after that. Thus, there is potential upside to dividends of $8 million in capacity payments by June 2024. Meanwhile, revenue amounted to $215.2 million plus a $13 million capacity payment from south flank expansion. Net profit after tax came in at $152.5 million. 

The company distributes 100 per cent of its profits as dividends. 

In a global landscape marked by burgeoning uncertainty and China’s post-COVID-19 economic malaise, Deterra Royalties emerges as providing iron exposure with greater stability. Deterra Royalties offers investors exposure to the iron ore market with distinctly reduced volatility compared to traditional mining entities. 

With that background established, the company released its half-yearly results for FY24, reporting figures that were largely in line with both internal expectations and market consensus. The company continues to explore avenues for portfolio expansion, particularly in bulk, base, and battery commodity royalties, although no deals have been finalised. With substantial undrawn debt facilities of $500 million and recent declines in junior mining company stocks, Deterra Royalties may be moving closer to securing new deals to create new royalties or purchase existing royalties. 

Deterra Royalties reported a net profit after tax (NPAT) of $78.7 million for the first half of FY24, matching internal projections and closely aligning with market estimates, albeit slightly below consensus by three per cent. The declared dividend of $14.89 conditions precedent, representing 100 per cent of NPAT in accordance with Deterra Royalties dividend policy, also fell within anticipated ranges but slightly missed consensus. Revenue for the period stood at A$119 million, consistent with the pre-reported royalty revenue update. 

Operating costs dipped by two per cent from the previous half-year to A$4.3 million but were up by four per cent year-on-year. Notably, business development costs surged to A$1.3 million, marking a 50 per cent increase from the previous period and a 140 per cent rise from the same period last year. This uptick reflects Deterra Royalties intensified efforts to evaluate growth opportunities, as managing director Julian Andrews highlighted. 

Deterra Royalties remains steadfast in its pursuit of growth opportunities, maintaining a flexible approach in both the size and type of investments/royalties sought. The company’s focus spans non-precious metals, including bulk, base, and battery metals, primarily targeting developed mining jurisdictions across Australia, North America, South America, and Europe. Deterra Royalties continues to prioritise royalties for production or near-production companies. 

A company that pays 100 per cent of its earnings as a dividend is relatively easy to value with a discounted cash flow (DCF). Adopting a required return of 6-7 per cent of the weighted average cost of capital (WACC), Deterra Royalties valuation falls in a range between A$4.70 and $5.10 per share. 

In summary, Deterra Royalties’ half-yearly results provided the stable and somewhat predictable operational performance our portfolio managers value, whilst also providing iron ore exposure. 

The Montgomery Fund and the Montgomery [Private] Fund owns shares in Dettera Royalties. This blog was prepared 19 February 2024 with the information we have today, and our view may change. It does not constitute formal advice or professional investment advice. If you wish to trade Deterra Royalties, you should seek financial advice. 

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