FT on OGS
OGS to raise £150m for R&D
By David Firn in London - Nov 13 2000 10:25:03
Oxford Glycosciences, the UK biotechnology company, is to raise about £150m ($213.8m) to fund expansion of its drug discovery and development operations. A portion of the shares will be offered as US ADRs. The group also plans to follow other UK companies that have sought a Nasdaq listing for their shares.
The funds will be used to fund the launch of the company's first drug, Vervesca, which is in clinical trials, and to expand its drug discovery capabilities.
Vervesca is a treatment of Gaucher's disease, a rare genetic disorder that causes fat to build up in white blood cells, leading to serious complications such as anaemia, liver enlargement and abnormal bone development. About 3,000 people worldwide are seriously affected and a further 10,000 are thought to have moderate forms of the disease. However, the curent treatment costs between $175,000 and $300,000 a year making Gaucher's disease a lucrative market.
Just a handful of doctors specialise in Gaucher's disease, which means the market is small enough for a biotech company the size of OGS to tackle marketing by itself.
OGS specialises in proteomics, the science linking genes to the proteins - enzymes and hormones - that are involved in disease and which can be targeted by new drugs.
Until now the mainstay of OGS strategy has been to generate intellectual property and sell it to pharmaceutical companies which would use it to develop their own drugs. But with the development of Vervesca, analysts say the major part of OGS's value now lies in the potentially much more profitable ability to develop its own medicines.
Michael Kranda, chief executive, said OGS was well positioned to build its own pipeline of drugs following the publication of the first draft of the Human Genome Project earlier this year. "The window of oportunity is open now," he said. "Genes aren't drugs. Moving from a gene to a pharmaceutical product is very difficult but OGS is well positioned to mine that data," he said.
About one third of OGS's shares are held by US institutions, but Mr Kranda said a Nasdaq listing would increase the group's visibility alongside industry leaders in the field of genomics such as Millennium and Human Genome Sciences. "We aspire to be a global player [but] we are not operating over there," he said.
OGS, which spun out of the University of Oxford in the 1990s, is a pioneer in the field of proteomics. However, analysts said it needed to expand its expertise to stay ahead in the increasingly competitive field of proteomics.
© Copyright The Financial Times Limited 2000. |
