Medical Therapies narrows focus, issues new prospectus

Unable to secure sufficient funds with its first attempt at an IPO, Sydney-based Medical Therapies has issued a replacement prospectus which CEO Llewellyn Casbolt believes has "uncluttered and demystified the company and its technologies".

Medical Therapies has narrowed its focus to a single technology used for developing novel therapeutics for the treatment of cancer and inflammatory diseases and reduced the subscription to AUD$3 million. The company had planned to raise $5 million and list on the ASX on August 12, and has now set a new target date of November 16.

"The reason we are refocusing is because we didn't make the $5 million. The company needed to refocus to make sure we get through the listing process and therefore are focusing on technology one -- technology two and three were difficult to understand and several years out from commercialisation," Casbolt said. "This means we only have to raise $3 million, because technology one has a shorter path to commercialisation."

Medical Therapies has also reported new discoveries by the University of Sydney which demonstrate that the anti-inflammatory compounds referred to in the original prospectus can treat several types of cancer as well as inflammatory disease.

"It's a seriously positive thing -- people were split between anti-cancer and anti-inflammatory," Casbolt said.

Medical Therapies has also had positive feedback from its discussions with US-based FDA consultants.

"We have discovered that the likely path to FDA approval for copper-indomethacin is much shorter than anticipated because we may qualify for fast-tracking within the FDA standard guidelines," Casbolt said.

Medical Therapies is planning to complete its phase I clinical trials for formulations of copper-indomethacin by the end of 2006 and, depending on the results of the trials, will complete phase IIa trials by the end of 2007.

"Excellent results have also been achieved in animal testing of squamous cell carcinoma, where 100 per cent remission was obtained in mouse models of the human disease -- it is potentially a cure for skin cancer in humans," Casbolt said.

The new offer of 15 million shares will be priced at $0.20. The company has received applications for over 7 million shares and monies totalling $1.4 million following the lodgement of the original prospectus on June 3.

"We are halfway there to $3 million," Casbolt said. "The market was against us in a biotech sense but this time round we have approached it in a different way and it has been a lot more positive. We are just beginning to see an upward trend for biotechs."