Alizyme narrows ’08 loss as R&D spend slows
Alizyme plc reported a narrowing loss after tax of £10.1m for the year ended 31 December 2008, compared with £31.2m in 2007.
The loss is the result of the level of R&D activity. Alizyme said its outsourcing business model combines low fixed overheads with a variable and controllable level of investment appropriate to the activities, particularly clinical trials, involved in progressing our products through their late stage development.
The reduction in the loss for 2008 compared to that for 2007 and the reduction in the loss for the second half of 2008 when compared to the loss for the first half of 2008, demonstrates the effect of the reduction in clinical trial activity during the year, the company said. There are no ongoing clinical trials sponsored by Alizyme and current R&D expenditure is much lower.
Cash receipts during the year which related to upfront and milestone payments arising from partnerships totalled £3.3m (2007: £1.3m).
Chairman Brian Richards said: "The past 12 months have seen almost unprecedented turmoil in the global financial markets which have presented some unique challenges and opportunities to all companies in the biotechnology industry.
"Against this background, Alizyme has continued to execute its strategy of building a portfolio of revenue streams combined with a flexible, low overhead business model in order to achieve its objective of becoming a profitable, self-sustaining biopharmaceutical product development company.
"In this regard, in 2008 we secured a new commercial partnership for COLAL-PRED and saw cetilistat move into Phase III clinical development in Japan. Both these events led to the receipt of licensing income for Alizyme. There was also continued progression in the clinical development of COLAL-PRED in both the US and Japan by our partners Prometheus and TSD.
"In the first half of 2008 we completed two Phase III studies. In line with our established outsourcing business model, following completion of these studies, ongoing research and development activity and expenditure have been significantly reduced. As a consequence of this lower level of activity, staff numbers have also been reduced, thereby lowering Alizyme's ongoing base level cash requirements. Alizyme's ongoing research and development expertise is now focused on supporting our partners in achieving our future licensing income streams through the commercialisation of our products.
Sir Brian said the world's pharmaceutical industry is facing a challenging future as it deals with patent expiries on blockbuster products, the ongoing need to renew product pipelines, increasing regulatory costs and an uncertain economic environment. All companies have to be flexible in how they construct licensing deals in these capital constrained markets and it is likely that the deals of the future may be very different from those of the past.
Alizyme said it recognises these challenges and is being innovative in its current discussions with potential partners as we look to sign new deals and commercialise our assets further.
Alizyme's shares shed 26% on the news. The company is now worth around £10m.
