Telix is developing theranostics using either small molecules or antibodies across its programs in four major disease areas. These are urologic malignancy, which includes prostate, renal, and bladder cancers; musculoskeletal cancer, which is muscle and bone cancer; brain cancer, and hematologic cancers, which are cancers of the blood.

“These are all areas where we think there are clear signatures and good targets to go after. These are cancers that, in the boxing match of cancer versus radioactivity, typically the radioactivity wins the bout,” says Behrenbruch.

The evolution of radiopharma in Australia and attainable capital

Listing on ASX has been an important source of support for Telix at a time when the market has been on an education process around life sciences.

After initially bootstrapping the company, in 2017, Behrenbruch and co-founder Andreas Kluge raised about $10 million in seed capital to develop data and exercise licence agreements for key technologies. Later that year, they raised $60 million through an ASX listing to fund larger clinical trials. 

“ASX is really special for us. The field of radiopharma was not sexy in 2017. It was viewed as a stagnant area of medicine because there hadn't been a lot of innovation in nuclear medicine for some time and investors were just not that interested in it. Fast forward almost a decade, and there's huge amounts of venture capital flowing into this space. But when we listed, ASX was a source of risk capital that was unique in the world. I would not have been able to attain the quality and cost of capital any other way,” says Behrenbruch.

“There’s a very strong nuclear medicine community in Australia, so institutional and small cap investors were able to do quite a bit of diligence on us. The ASX pathway is really effective for us. The cost of being a public company is manageable and compliance is manageable. I couldn't be more positive about the alignment between the risk profile of the business and ASX,” he adds. 

Telix recently closed a four-times-over-subscribed $650 million convertible bond issue, with good institutional support. This reflects investor confidence in the management team and its ability to execute strategy. 

“When you're a profitable, commercial company, you have access to different forms of financing compared to when you’re a start-up. We decided to diversify our financing strategy with a debt instrument. It's a very strong statement to the market we are a prime company because we can afford to service debt,” says Behrenbruch.

Telix is a different beast compared to when it first listed. “We have a new investor base now we're an ASX 100 company and a more mature business. When I did an investor roadshow recently, I walked around with our ESG director, reflecting our focus on that area. The world has changed for us now we're a $6 billion company. Whether you invest in us as an equity or as a bond, there's a huge amount of upside for shareholders,” he says.

Staying local and loyal to ASX investors

Telix considered a US listing earlier this year, but the release of positive clinical data and good commercial results saw the stock price double during the process. “That made price discovery very challenging. We don’t want to turn our back on our loyal ASX shareholders just to have a dual listing and there was a premium to list in a major market we were not prepared to pay,” says Behrenbruch.

“The loyalty and recognition of our shareholder base in our home market is critically important to the company's success. US investors didn’t want to buy at the top, they wanted to buy 20 per cent to 30 per cent below the top, but for us, a dual listing has to be on reasonable terms,” he says. At the time of writing, Telix applied to list “American Depository Receipts” on Nasdaq. This would allow US investors to access existing Telix stock through a depository receipt which trades and settles in the US.

Building out the product pipeline is where much of the company’s attentions lie presently. “We plan to  have five commercial products with regulatory approval by this time next year; two in prostate cancer, one in renal cancer, one in brain cancer and one in bone infection. It's amazing to have endogenously developed and acquired a portfolio of great assets. Normally, a biotech company’s goal is to build intellectual property and clinical data to the point where you become a takeout target. That is not our goal - although we have had overtures over the years to become part of somebody else's organisation,” Behrenbruch says. 

Telix is itself highly acquisitive and has averaged three or four transactions a year. “The reason why we upsized our convertible note was to pursue some pretty interesting deals,” says Behrenbruch. “When Andreas and I started the company, the goal was to build a business model where the precision medicine could go to market quickly, have a fairly streamlined pathway and a relatively understandable reimbursement landscape. Then, we can reinvest those earnings into the high-value, high-risk, high-return component, which is the therapeutic pipeline,” he adds.  

What’s in the pipeline for Telix? 

This year, Telix plans to invest about $200 million from earnings into R&D. There are no plans to pay a dividend. “The day we pay a dividend will be a signal to the market we have run out of ideas,” Behrenbruch says.

Internationalising the business is part of Behrenbruch’s current focus. Telix’s prostate cancer imaging agent is already sold in Australia, New Zealand and US and Canada. There are 19 European Union countries where the product is awaiting approval, as well as the UK and Brazil. Plus, clinical trials are being run in Japan and China. “By this time next year we expect to be a multi-product revenue stream business that’s commercially active in more than 25 countries,” he says.

The aim, says Behrenbruch is to be an offensive not a defensive player in the market.