Pancreatic cancer medtech OncoSil raising $8.7m as it edges closer to cashflow breakeven

Pancreatic cancer treatment device company OncoSil Medical (ASX: OSL) is raising $8.7 million to fund the commercialisation of its key product which is expected to take the company to a cashflow breakeven point by the December half of 2026.

The capital raise, which comprises a $6.7 million placement and a $2 million share purchase plan (SPP), has already secured the support of Sydney-based funds manager Pengana Capital Group (ASX: PCG), an existing investor in the med-tech company.

OncoSil says the funds will be used for advancing clinical trials and boost its pro-forma cash balance to $14.1m.

This will provide enough working capital to see the company through to the second half of next calendar year when OncoSil Medical expects to be generating positive operating cash flow.

Earlier this month, OncoSil reported record quarterly dose sales for the March quarter, on the back of continued growth in clinical adoption of the OncoSil device.

The company reported sales of $220,000 for the quarter, taking sales for the nine months to the end of March to $622,000. However, OncoSil reported a cash burn of $2.98 million for the quarter, and $9.15 million for the first nine months of FY25.

OncoSil Medical CEO Nigel Lange says the company is pleased to have received “strong investor support” from new and existing shareholders for the latest capital raise.

“I want to personally welcome the new investors joining our share register by virtue of the placement,” he says.

“I also want to thank Pengana Capital Group for both being a cornerstone investor in the placement and their ongoing support.

“The accompanying SPP gives our existing shareholders an opportunity to add to their holding in the company as its commercialisation strategy continues to be delivered.”

Lange notes that a significant portion of the new capital raised will fund ongoing commercialisation of its product which treats pancreatic cancer by imparting a pre-determined dose of beta radiation directly into cancerous pancreatic tissue.

OncoSil has received firm commitments from sophisticated and professional investors for $3.25 million in the first tranche of its share placement and about $3.45 million for the second tranche.

The placement, which is subject to shareholder approval, comprises the issue of 2.3 billion OncoSil shares at an issue price of 0.3c per share.

The placement also includes one free option for every new share issued at an exercise price of 0.3c each, expiring on 31 July 2027.

The share purchase plan to raise $2 million from existing investors is priced at the same level. Neither the placement nor the SPP offer are underwritten.

Over the past 18 months, OncoSil has expanded its reach into multiple global markets, including Europe and the Middle East, while its PANCOSIL trial is under way to explore the safety and feasibility of using the OncoSil device in tandem with conventional treatments for patients with non-progressive locally advanced pancreatic cancer.

OncoSil says the landmark study is now 95 per cent recruited and, if successful, the company intends to seek label expansion for the OncoSil Device for use by interventional radiology in existing jurisdictions.

A second trial, the TRIPP-FFX study, is now 99 per cent recruited through which OncoSil plans to seek label expansion for its device for use with the FOLFIRINOX chemotherapy combination in existing jurisdictions.

“The completion of these two trials, expected shortly, serves as a significant catalyst for the company and greatly expands market access for the OncoSil Device, making it available to interventional radiologists and across the most widely used chemotherapy regimens,” says the company.

OncoSil says 120 Hospitals across Germany are now eligible to seek reimbursement for the commercial sale of the OncoSil device.

This is up from the 84 at the end of FY24 that were authorised by the German Institute for the Hospital Remuneration System to negotiate funding for the device classification under the innovation funding program with health insurance companies.