Virax sanguine on shortfall in $3.1m raising

Melbourne immunotherapy developer Virax Holdings (ASX:VHL) has raised $3.1 million through a rights issue for the further development of its HIV therapeutic vaccine, falling $700,000 short of the $3.8 million the company planned to raise.

"The directors have the capability of taking the shortfall and I think it should play out in the next few days," said Virax CEO Dr David Beames. "We are very pleased with the result at this time of year and due to the state of the biotech sector at the moment."

The funds will be used to complete the preparations for the phase II trial of VIR201, including the investigational new drug application to the FDA in the US, a clinical trial notification to the TGA in Australia, and ethics committee approvals at the institutions where the trials are to be conducted.

Virax plans to fund the phase II trial from a major capital raising in the order of US$6-8 million (AUD$8-11 million) which it says in its prospectus is most likely to be from major new investors who are likely to be found overseas.

"In parallel to the preparations for the phase II trial we are continuing our activities in Europe and the UK and will be undertaking follow-up exploration with investment bankers and brokers next week," said Beames.

In October Virax received notification from the US National Institutes of Health that its application, in collaboration with the National Centre in HIV Epidemiology and Clinical Research at the UNSW, for a contract award to fund a phase II trial for VIR201 was unsuccessful.

Virax plans to have the preparation work completed during Q4 2006 with patient enrolment to commence by the end of 2006. The interim trial results are expected to be available late 2007 and the final results by mid-2008.