Firm’s £48m for Covid-19 testing
Placing will also help cancer therapy
SHARES: Drug developer Avacta is to raise £48m through a share placing to fund its Covid-19 rapid-testing programme and its cancer therapy pipeline.
The Wetherby-based firm recently signed a distribution agreement with Boohoo billionaire Mahmud Kamani to supply a test for coronavirus.
DRUG DEVELOPER Avacta is to raise £48m through a share placing to fund its Covid-19 rapid testing programme and its cancer therapy pipeline.
The Wetherby-based firm recently signed an exclusive distribution agreement with Boohoo billionaire Mahmud Kamani to supply a saliva-based, rapid test for Covid-19.
Avacta said the test should give a result within minutes and is designed for use by both healthcare professionals and consumers around the world.
The group said the consensus view is that hundreds of millions of antigen tests will be required every month to support the fight against the pandemic amid the initial easing of the lockdown during 2020, and to deal with the long term challenge of endemic Covid-19.
It said a rapid point-of-care antigen test using saliva is ideal for mass screening of populations for coronavirus.
It noted that there are only a few rapid antigen tests in development and none have CE/FDA approval yet.
FinnCap, Zeus Capital and Beech Hill Securities are acting as joint brokers for the placing. Retail investors will also be able to take part in the placing via the PrimaryBid platform.
The issue price of 120p per share is at a discount of 4.4 per cent to the 30-day volume weighted average price of the ordinary shares on June 3, which was 125.3p per ordinary share.
In a trading update, Avacta said
revenues for the 17-month period to December 31 have grown 100 per cent to £5.5m from £2.76m for the 12 months to July 2018.
The firm said revenues from its Affimer diagnostics business have grown, over the same period, by 135 per cent as more customer evaluations of the Affimer platform are underway. Affimers are Avacta’s high-tech alternative to antibodies.
The group said its order intake and sales pipeline into 2020 are the strongest to date.
In May, Avacta signed an agreement with Medusa19 (Mr Kamani’s global consumer self-testing business) for direct-to-consumer sales of its newly developed rapid test for the Covid-19 antigen, subject to regulatory approvals.
Just before this, Avacta announced a partnership with life sciences giant Cytiva to develop a saliva-based rapid antigen test to indicate whether a person has the Covid-19 infection.
The test is intended to give a result within minutes and is for use by both healthcare professionals and consumers.
In addition, Avacta has announced a collaboration with Adeptrix to develop and manufacture a coronavirus antigen test that will provide clinicians with a significant expansion of the available testing capacity for Covid-19 infection in hospitals.
Given the expected volume of sales for Covid-19 antigen testing products, Avacta said the potential revenue stream could be transformational for the group.
Avacta intends to commercialise further the Covid-19 Affimer reagents it has generated through additional diagnostic development partnerships.
Additionally, the group said it is making very good progress with its own pipeline of diagnostic tests which will also deliver licensing opportunities in the medium term.
Avacta will soon file an IND/ CTA application for a phase I dose escalation study for its lead chemotherapy AVA6000 product.