Viralytics R&D Tax rebate higher than expected

Viralytics (ASX:VLA) got an early Christmas present this week, revealing it received nearly 70% more than originally estimated for its FY12 R&D Tax Incentive rebate.

The company, which is developing prospective cancer treatments from oncolytic viruses, announced it has received nearly $1.5 million from the ATO as an R&D tax rebate for the financial year.

This compares to $871,000 originally estimated in the company's FY12 report.

Viralytics said it will inject the funds back into its oncolytic virus programs, including the in-progress US phase II trial of Cavatak in melanoma.

Cavatak is a proprietary formulation of coxsackievirus A21, a common cold virus which binds to and has a cytotoxic effect on a variety of cancer cells.

Viralytics recently published the results of a phase I dose escalation study of the treatment in stage IV patients with solid tumours.

The company also holds the patents to a formulation of Echovirus Type 1, which uses a different cell surface receptor to bind and infect cancer cells.

Viralytics (ASX:VLA) shares were trading 4.17% lower at $0.345 as of 2:30pm on Tuesday.