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The European Biotech Report
OGS alliances to pay off in 2002
KS Biomedix reports jump in year turnover, flat losses
By Saskia Wirth, FTMarketWatch.com 12:21:00 PM BST Sep 24, 2001
LONDON (FTMW) - UK biotech company Oxford GlycoSciences [UK:OGS] [US:OGSI] on Monday reported a jump in first-half turnover, beating analysts' expectations, but failing to update investors on current ventures.
First-half losses widened to £8.65 million from £7.28 million the previous year. Turnover climbed to £8.71 million from £4.47 million, while loss per share narrowed to 13.25 pence from 17.89 pence in 2000. Broker SG Cowen had forecast total revenues of £5.7 million and a loss per share of 11 pence.
Shares have more than halved in value since Oxford GlycoSciences last reported in March from just under £12. They traded 2.2 percent lower at 452.5 pence by mid-day.
Investors were disappointed not to here news of the company's 50:50 joint data-hosting venture Confirmant, with struggling telecom equipment maker Marconi [UK:MONI] [US:MONI]. See OGS teams up with Marconi
However, OGS said its collaborations with Medarex [US:MEDX] of the U.S., Sweden's BioInvent International [SE:000078971] and Hybrigenics are expected to boost its pipeline from next year onwards.
"We expect continued progress during the second half in both our clinical development and drug discovery activities," OGS said. "We now have key alliances in place and anticipate significant expansion of our clinical pipeline in 2002 and beyond."
Securing the future
Oxford GlycoSciences focuses its research on identifying disease-related proteins, observing their behaviour in disorders such as cancer or Alzheimer's and how they respond to medication.
Market observers are eagerly awaiting marketing approval for Vevesca, the company's lead product for Gaucher disease, a genetic enzyme defect. The only treatment currently available, Genzyme's [US:GZBX] Cerezyme, is one of the most expensive medical treatments in the world with an annual cost of £123,500 ($180,000).
Vevesca has won Orphan Drug status, which will grant the product seven years of market exclusivity in the U.S. and ten years in Europe once it's approved. It is generally believed that approval will secure OGS's financial future.
However, broker Merrill Lynch recently expressed concern about the possibility of disappointing news from the U.S. Food and Drug Administration regarding Vevesca. Merrill forecasts peak sales of $90 million for the drug, considerably less than the market consensus of $300 million.
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