Here are 3 ASX stocks fighting diabetes and the opportunity ahead of them

There aren’t many ASX stocks fighting diabetes, but the few that are have a big market opportunity ahead of them. And they are not just about fighting the condition directly but other ailments that can result from having diabetes.

It is estimated that 537m people have diabetes globally and 3 out of 4 of them live in low- and middle-income countries. Diabetes is responsible for 6.7m deaths annually and US$966bn in health expenditure – figures expected to rise in the future. But if these companies have their way, diabetes (or at least consequences of diabetes) may be less of a problem.

3 ASX stocks fighting diabetes!

Recce Pharmaceuticals (ASX:RCE)

Recce is developing its flagship asset RECCE^® 327 (R327) for multiple indications, of most relevance is Diabetic Foot Infections (DFI). The company capped off 2024 with the news it obtained approval from Indonesia’s Drug and Food Authority (Badan POM) to initiate a Phase 3 trial assessing R327 (in a gel formation (R327G) for the treatment of DFIs.

Indonesia may appear an obscure location for an ASX healthcare company to conduct a clinical trial, but there are a number of favourable factors, particularly the fact that there are 19.5m Indonesian adults living with diabetes, making it one of the biggest diabetes markets in the world. Significant support from the Indonesian and Australian governments will help too – with the Australian government’s 43.5% R&D rebate scheme applying to Recce’s overseas activities. It is estimated that this study will be the first of its kind across Indonesia and one of the largest DFI clinical trials in the world.

The trial was approved at the end of 2024 and is expected to read-out in late 2025. It will enrol a total of 300 patients with 200 of them receiving R327G and 100 receiving a placebo. If the trial is successful, regulatory and a commercial launch should occur in the first half of 2026.

Proteomics (ASX:PIQ)

Proteomics is developing and about to commercialise 3 diagnostic tests, all of which based on identifying particular ‘biomarkers’ in a patients blood. One is PromarkerD for DKD (Diabetic Kidney Disease). The company intends to bring PromarkerD to market in Australia in Q1 2024, followed by the EU and USA later in CY25.

DKD is a broad term applied to any kidney damage caused by diabetes and it is estimated that 1 in 3 diabetics have DKD. Kidney function can fall as low as 15% even without symptoms. By the point where DKD is detected by symptoms, it is at a more advanced stage where the condition is chronic and more difficult to treat. But if DKD is detected earlier, doctors may be able to prescribe an early therapeutic treatment to slow or stop the disease that they wouldn’t be able to at a later stage.

PromarkerD has a market opportunity of 21.1m in the USA, 40.9m in the EU and 1m in Australia. These are the two-thirds of diabetics who do not have DKD, as PIQ believes it can serve them by predicting whether or not they will develop DKD.

PIQ will commercialise in the US using the Lab Developed Test (LDT) pathway as an alternative to FDA 510(k) registration. PromarkerD will receive a US$390.75 reimbursement rate from Medicare. In Australia, it will be launched via the equivalent pathway – the ISO 15189 – while PromarkerD has CE Mark approval for Europe. If you can detect and subsequently the diseases earlier, you may have a better chance of defeating them.

Opthea (ASX:OPT)

Opthea is an optometry-focused biotech developing a drug called Sozinibercept (formerly known as OPT-302). Sozinibercept is administered via injection and it is a ‘VEGF-inhibitor’ (Vascular endothelial growth factor). It prevents the abnormal growth of blood vessels and leakage of fluid and protein from the vessels, which can cause wet AMD. It is the work against wet AMD where this company is most famous for and is most advanced – expecting data from multiple Phase 3 trials in the first half of 2025.

But Opthea has undertaken work in the past in relation to Diabetic Macular Edema (DME). Diabetes-related macular edema, or DME, happens when fluid builds up under the macula, the center of the retina. Diabetics can develop retinopathy which can evolve into DME.

Diabetes affects blood vessels in the eyes, making them weaker and more likely to leak blood. DME may also cause new and more fragile blood vessels to grow where they shouldn’t. Diabetic macular edema is the leading cause of central vision loss in people living with diabetes. It is estimated to affect around 19 million people worldwide, and with the rise of diabetes, the prevalence is expected to increase to 29 million by 2045

A Phase 2a trial back in 2020 showed positive results – in a nutshell, patients’ eyesights improved enough to see more than 5 letters on a stereotypical ‘letter chart’ an optometrist would use to do a vision test with a patient. For now, Opthea’s focus remains on Wet-AMD. But if it can get Sozinibercept to market, it may be a quicker process to commercialise this drug against DME given it works in the exact same way and has existing clinical data.

Proteomics is a research client of Pitt Street Research and Recce is a client of Stocks Down Under. 

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