Recce Pharmaceuticals Ltd (ASX:RCE, OTC:RECEF) has reported a quarter marked by clinical and strategic progress across multiple fronts. Highlights included regulatory engagement in Indonesia for its registrational Phase 3 clinical trial, extended access for diabetic foot ulcer patients in its Phase 2 trial, and a second research agreement with the United States Army Medical Research Institute of Infectious Diseases (USAMRIID).
The company also raised A$15.8 million from existing shareholders and secured a non-dilutive debt facility of up to ~A$30 million. A patent was accepted in China, and Recce received a scientific rebate from Canada, supporting a robust cash runway into FY26.
Clinical development: Expanded trials in Indonesia and Australia
Recce progressed its registrational Phase 3 clinical trial in Indonesia through successful meetings with the Food and Drug Authority (Badan POM) and onboarding of additional hospitals to support patient recruitment. This builds on earlier groundwork in diabetic foot infections.
Meanwhile, the company received Human Research Ethics Committee (HREC) approval to extend access to its RECCE® 327 Topical Gel (R327G) under the ongoing Phase 2 trial.
The expanded protocol addresses recurrent diabetic foot ulcers and follows positive results in a separate trial for acute bacterial skin infections. These showed 86% of patients had a clinical response after seven days, rising to 90% by day 14, using FDA-accepted assessment tools.
Defence research: USAMRIID agreement bolsters biodefence focus
A second Cooperative Research and Development Agreement (CRADA) was signed with USAMRIID, supported by the US Defense Threat Reduction Agency.
Recce’s synthetic anti-infective R327 is undergoing testing against high-threat pathogens within USAMRIID’s Biosafety Level 4 facility. Pending successful in vitro results, the work may progress to small animal models.
The agreement reflects growing defence interest in Recce’s compounds, with company executives conducting follow-up meetings with senior US Department of Defense officials in Washington DC.
Intellectual property and R&D rebates strengthen international positioning
Recce secured a Notice of Acceptance from the China National Intellectual Property Administration for Patent Family 4, extending protection for its anti-infectives until 2041. This complements existing patents in Australia, Canada, Japan and Israel, with other jurisdictions under review.
Additionally, the company received a US$175,122 (A$271,987) rebate under Canada’s Scientific Research & Experimental Development program, supplementing its expected A$8.5 million refund from Australia’s R&D Tax Incentive scheme due later in 2025.
Capital management: Strong funding runway into FY26
The company raised A$15.8 million (before costs) exclusively from existing shareholders. Funds will support the Phase 3 trial in Indonesia for diabetic foot infections, a second registrational trial for skin infections in Australia, regulatory filings and general working capital.
Recce also accessed a non-dilutive debt facility from Avenue Capital Group for up to A$30.55 million, with A$11.49 million drawn during the quarter and the balance available subject to conditions. The facility underpins ongoing trial activities and commercial expansion in the ASEAN region.
Financial position: Solid liquidity through strategic capital mix
As at June 30, 2025, Recce held A$10.53 million in cash. Net operating outflows totalled A$10.81 million, driven mainly by A$8.8 million in research and development spend. Financing activities contributed A$21.34 million in net inflows, bolstered by equity raising and borrowings.
With total available funding of A$31.2 million, including unused facilities, Recce estimates 2.88 quarters of cash runway, excluding the expected Australian R&D rebate.