English
English
Stock of the day: Clarity Pharmaceuticals
Clarity Pharmaceuticals' shares jumped 10% after confirming first patient enrolment in its phase three trial for prostate cancer detection, but analysts warn of the long road ahead for biotech commercialisation.
(AI video summary)
This video was created on 29 May 2025 for IG audiences by ausbiz.
ASX code: CU6
Phase three trial milestone drives gains
Clarity Pharmaceuticals confirmed it dosed the first patient in its phase three amplified trial, sending shares up 10% in morning trading. The diagnostic trial focuses on patients with biochemical recurrence of prostate cancer, aiming to detect recurrence earlier and more accurately than current methods.
The company is gathering data to support a new drug application with the United States (US) Food and Drug Administration (FDA), marking a significant step towards commercialisation. Clarity's copper-based technology binds to cancerous cells in the prostate, providing more efficient and accurate detection.
Clinical trial results show promising outcomes, with some patients reportedly cleared of prostate cancer. The company received fast-track approval from the FDA, enabling constant communication with regulators.
Investment risks remain high
Despite the positive news, analysts emphasise the inherent risks in biotech investing. Phase three trials carry a 40% failure rate and typically take three to four years to complete.
Unlike earlier safety-focused phases, phase three trials examine both efficacy and longer-term side effects. The Australian market saw these risks with CSL Limited, which failed its phase three trial for CSL112 after investing approximately $1 billion.
Investment outlook
Analysts maintain a speculative 'buy' rating on Clarity Pharmaceuticals, acknowledging both the technology's transformational potential and pre-revenue business status. The share price previously reached $8 before settling as investors reassessed valuations.
For biotech exposure, analysts suggest treating such investments as high-risk speculative plays. Alternative approaches include waiting for capital raisings or considering charitable donations to cancer research organisations for tax benefits while supporting scientific advancement.
Important to know
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Ready to open an IG account?
Start your trading journey now
Connect with us
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
Professional clients trading spread bets and CFDs can lose more than they deposit.
Options and futures are complex instruments which come with a high risk of losing money rapidly due to leverage. They’re not suitable for most investors. Before you invest, you should consider whether you understand how options and futures work, the risks of trading these instruments and whether you can afford to lose more than your original investment.
Trading stocks and shares ‘on margin’ within a US options and futures account – meaning that you only finance part of the cost of acquiring a position in a security – carries additional risks over buying securities on a fully funded basis and may result in losses exceeding your original investment. Trading on margin will also result in additional costs to you as the investor and any securities purchased using margin may be held as collateral by the lender, restricting both your rights as shareholder, and your ability to use the securities until the margin trade is closed. You should familiarise yourself with these risks before trading on margin.
The value of shares, ETFs and other ETPs bought through a share dealing account, a US options and futures account, a stocks and shares ISA or a SIPP can fall as well as rise, which could mean getting back less than you originally put in. Past performance is no guarantee of future results. Some ETPs carry additional risks depending on how they’re structured, investors should ensure they familiarise themselves with the differences before investing.
Share dealing and IG Smart Portfolio accounts provided by IG Trading and Investments Ltd, CFD accounts and US options and futures accounts are provided by IG Markets Ltd, spread betting provided by IG Index Ltd.
IG is a trading name of IG Trading and Investments Ltd (a company registered in England and Wales under number 11628764), IG Markets Ltd (a company registered in England and Wales under number 04008957) and IG Index Ltd (a company registered in England and Wales under number 01190902). Registered address at Cannon Bridge House, 25 Dowgate Hill, London EC4R 2YA. IG Markets Ltd (Register number 195355), IG Trading and Investments Ltd (Register Number 944492) and IG Index Ltd (Register number 114059) are authorised and regulated by the Financial Conduct Authority.
The information on this site isn’t directed at residents of the United States, Belgium or any particular country outside the UK and isn’t intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.