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GUELPH, ON - Zentek Ltd. (NASDAQ:ZTEK)(TSXV:ZEN), an intellectual property technology company with a market capitalization of $120.55 million, has announced the commencement of the testing phase for its avian influenza countermeasure after successfully completing the first phase of a contract with the Government of Canada. According to InvestingPro data, while the company’s stock has shown strong momentum with a 43.4% gain over the past six months, it currently trades near its Fair Value. This development is part of a CAD 1.1 million project funded by Canada’s Innovative Solutions Canada (ISC) Testing Stream to create a prophylactic and therapeutic solution for the highly pathogenic avian influenza (HPAI) A(H5N1).
The contract, which began in November 2024, utilizes a multivalent aptamer strategy similar to the one Zentek employed in developing a SARS-CoV-2 countermeasure. This approach has shown efficacy against all tested variants of the virus. The project aims to enhance Canada’s response capabilities to the global avian influenza outbreak, which has led to the culling of millions of birds and crossed species barriers since 2020.
Through collaboration with the Li Lab at McMaster University, Zentek has focused on selecting lead monomers for their binding affinity and specificity to the hemagglutinin (HA) protein, constructing multivalent forms to increase avidity, and conducting in vitro testing for effective neutralization of H5N1 and other influenza strains. While the company advances its research initiatives, InvestingPro analysis reveals the company is currently operating with negative earnings, reflecting its development-stage status. InvestingPro subscribers have access to 8 additional key insights about Zentek’s financial health and market position.
The lead candidate has met the performance metrics of the government contract, matching the neutralization performance of a monoclonal antibody control in recent experiments. Prof. Yingfu Li from McMaster University praised the collaboration’s productivity, highlighting the potential of multivalent aptamers as countermeasures for various pathogens.
Zentek’s next phase involves providing sufficient materials for in vivo testing by Dr. Matthew Miller’s team at McMaster University against H1N1 and the current H5N1 clade in circulation.
Greg Fenton, CEO of Zentek, expressed gratitude to the Li Lab and the support from the Department of National Defence’s Defence Research and Development Canada (DRDC) and Health and Emergency Preparedness Canada (HERC).
Zentek is known for its patented ZenGUARD™ technology, aimed at enhancing the filtration efficiency of surgical masks and HVAC system filters, and holds an exclusive license to the aptamer-based technology from McMaster University for the next 20 years through its subsidiary Triera Biosciences Ltd. The company maintains a moderate debt level with a debt-to-equity ratio of 0.05, according to recent InvestingPro financial metrics, positioning it for potential growth in its specialized market segment.
While Zentek has made progress in its aptamer technology, it has not claimed the ability to eliminate or contain COVID-19 or SARS-CoV-2 at this time. This advancement in avian influenza countermeasure development is based on a press release statement from the company.
In other recent news, Zentek Ltd. announced significant findings regarding its ZenGUARD™ Enhanced Air Filters. The company revealed that these filters have maintained their viral filtration efficiency (VFE) after 20 months of aging, with a VFE of 38.1%, closely mirroring the original performance of 37.7%. This development is crucial as the filters are set to be marketed as a Class I medical device. Testing by LMS Technologies, Inc. confirmed that the ZenGUARD™ coating remains well-adhered to the filter substrate over time. Zentek is in the process of finalizing documentation to support the manufacturing and sale of these filters under its medical device establishment license, ensuring compliance with Canadian Medical Device Regulations and the ISO 13485:2016 Quality Management System. CEO Greg Fenton highlighted the importance of these results, which confirm the filters’ effectiveness and safety in reducing infectious bioaerosols until their expiry date. The company is progressing towards commercialization, with its production facility based in Guelph, Ontario. Additionally, Zentek holds a global exclusive license for an aptamer-based platform technology from McMaster University.
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