Biota aims to reclaim position after flat half-year
Biota Holdings' much-hyped influenza drug, Relenza, failed to contribute revenue in an interim result that saw the company record a loss of $3.2 million.
The one-time darling of the local biopharmaceutical scene said it was currently negotiating collaborations with international research groups and seeking US capital funding to accelerate existing projects and to broaden its development pipeline.
Analysts said that while Relenza's lack of sales was largely expected, they were keen to know how the company planned to reclaim its market position.
At the time of writing, Biota's shares were 3.6 per cent down at 53c after starting the day at 55c.
In a statement released to the Australian Stock Exchange, the company said $1.8 million of its consolidated losses were the result of establishing its US arm, Biota Inc.
The remaining $1.6 million in losses were incurred in Australia on revenues of $6.1 million.
The result compares with a profit of $1.4 million for the corresponding period last year. Retiring chief executive officer Dr Hugh Niall was on a road show in Sydney today and unavailable for comment.
But a statement quoting chairman John Grant said the company was forecasting further losses.
Grant said Biota now had a clear view of its situation and was committed to rebuilding its position as a leading drug discovery and development company in collaboration with other groups.
"In the absence of significant levels of royalty income Biota as a drug discovery group will continue to record losses, however we will seek to reduce the extent of losses through innovative, collaborative financings and maintain a tight control over cash outlays." Grant said.
An internal review of the company's portfolio had led to reprioritisation and shifting of resources into new areas, the statement said.
- A second-generation drug for the prevention and treatment of flu, with animal tests suggesting it could prevent the disease with weekly dosing.
- The identification of key targets in treating Respiratory Syncytial Virus (RSV).
- Applying its patented Flunet technology, which provides prolonged action against the disease, to existing drugs.
- Broadening its research to a range of chronic infectious diseases and inflammatory conditions through collaborations in Australia.
- The company said it also had interest from 10 companies in the US, Europe and Japan for the development of its Flunet and RSV projects.
Biota's interim report revealed revenues down $2.7 million from $8.8 million in the corresponding period.
It showed sales were derived from the company's diagnostic products, with no revenue on sales of anti-viral drug Relenza (Zanamivir) compared with $2.4 million over the same time last year.
Pharmaceutical giant GlaxoSmithKline has the global sales and marketing rights to Relenza, with Biota receiving a percentage of sales and agreed 'milestone' payments.
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