The Incannex Healthcare Ltd (ASX: IHL) share price is having a year to remember.
At the time of writing, shares in the company are up 170% in 2021 and 3.7% today to 42 cents each. It's an impressive feat with many factors behind it.
Let's take a closer look and see why the company's shares are so high.
Company profile
Incannex is a pharmaceutical company that specialises in medicinal cannabinoid and psychedelic products. It sells worldwide, with a particular focus on the United States. The company, however, does not have regulatory approval to sell its products in the US.
The company claims its medicines can be used to treat a range of ailments, including anxiety, sleep apnoea, traumatic brain injury, respiratory illnesses such as asthma, arthritis, and inflammatory bowel disease.
Why the Incannex share price is blazing in 2021
The Incannex share price has been absolutely rocketing in 2021 — for a variety of reasons.
For example, in March, shares in the company leapt 10% on the news a clinical trial by the company proved its treatment to be more effective in treating rheumatoid arthritis than currently available medications.
The company's announcement at the time said the drug was up to 3.5 times more effective at reducing arthritis than common treatments currently on the market.
At present, the main treatment for rheumatoid arthritis is hydroxychloroquine (HCQ), marketed as Plaquenil. The company noted long term use of HCQ has been linked to increased cardiovascular mortality. HCQ has been in the news recently over debunked claims the drug could treat COVID-19.
Another reason for the rising Incannex share price is the company's ongoing process to navigate the regulatory framework of the world. In July, for example, Incannex filed a patent application for use in Europe, Japan, and Australia for its IHL-42X development program. Its share price increased on the news.
As well, in August, the Incannex share price rose 9% when the company announced it was taking the first steps to list American depository shares (ADS) on NASDAQ. 1 share of the ADS would be equivalent to 50 shares of Incannex on the ASX. Shareholders still need to approve of this decision.
Incannex FY21 results
For financial year 21, Incannex reported the following:
- Revenue from ordinary activities up 214% to $1.9 million.
- Losses for the year jumped 73.8% to $8.2 million.
- Basic loss per share of 83 cents – up from a 69 cent per share loss in the prior corresponding period (pcp).
- Net cash from operating activities outflow of $6.9 million which is higher than the $3.9 million outflow in the pcp.
The Incannex share price rose 7.79% on the day of the results announcement.
Incannex share price snapshot
Since listing on the ASX, the Incannex share price has fallen 91.3%. However, over 5 years, it is up 406% and over 12 months, it is 710% higher.
The company has a market capitalisation of around $453 million.
