Losses down, revenues up in Amrad half-years

Amrad (ASX:AML) released its half-year results today, revealing a 10 per cent increase in revenues to AUD$8.14 million and a decrease in operating loss to $2.2 million -- down 48 per cent.

The results were helped along by receipt of the first milestone payment from Merck Sharp and Dohme in December, which boosted revenues by $4.2 million. The company has so far received $11.7 million out of a potential US$112 million plus royalties if asthma drugs based on the IL-13 receptor project are successfully commercialised.

CEO Peter Smith said additional milestone payments from the partnership would be received over the next few years.

At the end of December, Amrad had $60.6 million in the bank, slightly more than the $60 million it had at the end of the 2002-2003 financial year. The company is expecting to have a modest drawdown in capital over the remainder of the financial year.

"We are focusing on costs throughout the company and a key element of this is a streamlining of the R&D portfolio," Smith said. "Amrad now has a clear R&D strategy that plays to its strengths."

Shortly after Smith was named the company's new CEO last year, Amrad has outlined plans to spin out its virology projects into a separate entity. Smith said the name Avexa had been reserved for the new company, and a number of spin-out strategies were currently under evaluation.

Phase II clinical trials on Amrad's most advanced product, emfilermin, which is being tested as a treatment for infertility by partner Serono, are expected to be completed in the second half of calendar year 2004.