IDT surprised by Virax claim

A claim from Virax Holdings that it had been approached by Melbourne company Institute of Drug Technology with a view to a full takeover, has taken IDT managing director Graeme Blackman by surprise.

"Virax released a rights issue prospectus last week, and in it they said they had been approached by IDT and had preliminary discussions," Blackman said. "Virax obviously felt it necessary to put out the release.

"I have to admit I was surprised to see it at this time," he added.

Blackman, who recently resigned from the Virax board, is not the only one. A well-placed industry commentator said the announcement was highly intriguing, and described it as "puzzling and bemusing."

"IDT has to be very clear and concise about its intentions -- the market can get savage if companies don't [make their intentions clear]," he added.

In response to the Virax note, IDT told the market that it "did not believe the discussion with Virax, nor consideration of other transactions, had progressed to the point where notification to the market is required."

However, Virax CEO David Beames claimed the release was part of its prospectus information aimed at raising capital, and said he could not expand on the information in the release because of ASX requirements.

"IDT didn't deny the takeover discussion, but they say they are also looking at other options and choosing which door to walk through," he said.

Virax is due to finalise its financing options by late June, said Beames, and had so far had what he described as "lots of interest".

"It is early days yet, and speculation doesn't help. These are tough times in biotech, but I think we have seen a turn-around in US stocks which are more volatile than ours here," he said.

Final results from the initial stage of Virax's Phase I/II study of its lead HIV immune-based therapy, VIR201, have shown the drug to be safe but not whether it will elicit an immune response as yet.