Avacta Group sees strong revenues coming into 2020
In a trading statement, Avacta, the developer of Affimer® biotherapeutics and reagents, said that revenues and cash had been ahead of market expectations.
The group attributed its growth to collaborations with companies including LG Chem, ADC Therapeutics, and Daewoong Pharmaceuticals, each of which fund Avacta’s R&D activities.
Revenues had grown 100% for the 17 month period ended 31 December 2019 to £5.5m from £2.76m from the 12 months ended 31 July 2018.
The cash position at 31 December 2019 saw a £3.5m increase from 31 July 2018 to £8.7m after the successful completion of a share placing last November.
Dr Alastair Smith, Chief Executive of Avacta Group, expressed his delight at the company’s growth and cash position noting that “significant commercial and operational progress” had been made during the period.
House broker finnCap reiterated that the progression of proprietary therapeutics assets and partnered programmes ‘continues to build value’ for Avacta.
Shares in Avacta Group were trading 7.88% higher at 19.5p on Thursday morning.
The Affimer® diagnostics business also grew revenues by 130% which were driven by customer Affimer evaluations, the statement added.
“Our diagnostics business has continued to gain traction and is poised for continued growth in 2020 which should ultimately lead to license revenues,” said Smith.
Meanwhile, Avacta also reconfirmed plans to take its first drug, AVA6000, into the clinic in the second half of 2020, with an initial readout expected before the year-end.
Having been modified with Avacta’s proprietary pre|CISIONTM technology, AVA6000 aims to reduce the side effects of chemotherapy without affecting the efficacy of the treatment -- this is possible because the pre|CISIONTM substrate generates chemotherapy pro-drugs that are only activated in the tumour.
The company believes the results from the study will provide “a major inflection point” and “significant commercial opportunity."
In a research note immediately following the release of the deal, finnCap reiterated a value of 76p a share on Avacta.
finnCap also forecasted increased FY 2019 revenues by £0.4m to reflect this morning’s trading update -- the group noted this morning that it intends to release results for the 17 months ended 31 December 2019 in late March 2020.
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