This news is unbelievable....and WHY IJX isn't STEPPING IN NOW!?!?!?!?
Reuters Company News
Weston Medical dives 90 pct on product blow
Tuesday September 3, 6:41 am ET
By Ben Hirschler, European Pharmaceuticals Correspondent
(Wraps CEO interview, analyst comment, latest shares)
LONDON, Sept 3 (Reuters) - Weston Medical Group Plc shares lost 90 percent of their
value on Tuesday as the British needle-free injection specialist delayed the launch of a
key product and said it would need additional funding.
The flagship Intraject device will not
now be launched until at least
mid-2005 while the firm makes
design modifications, after tests
showed some products were not
working properly.
"It's a bombshell. There was no
warning of this and it's very late in
the day to start saying there are
problems," said Robin Campbell,
industry analyst at WestLB Panmure.
Shares in the group, which floated in
May 2000 and peaked at 275 pence
in January 2001, traded down to as
little as four pence after closing on
Monday at 50. They were quoted off
87 percent at 6-1/2 by 1040 GMT.
Weston Medical has trumpeted its Intraject device as a less painful and more effective
way of delivering drugs into the body, winning backing from major drug firms including
Roche Holding AG (ROCZg.VX), GlaxoSmithKline Plc (London:GSK.L - News) and
Abbott Laboratories Inc (NYSE:ABT - News).
Investors had expected some of these licensee partners to start filling the device with
their medicines in 2003. That will not now happen, leaving the firm with a yawning
funding gap.
Chief Executive Christopher Samler said it was not possible yet to say how much new
cash was needed.
"It all depends on the extent of the delay and we haven't fully bottomed that out," he
told Reuters.
All options for fund-raising were being considered, he added. "There are all sorts of
ways of cutting this, from a rights issue, to a restructuring of our agreements (with
pharmaceutical companies), through to potential M&A considerations."
Weston Medical had cash reserves of 21 million pounds ($32.60 million) at the end of
March and has been burning its way through just under one million pounds a month,
excluding capital expenditure.
The group discovered that some of its devices were not working properly after
conducting new in-house tests about a month ago.
"The results surprised us hugely. Some of the devices weren't performing as expected,
they weren't as consistent as expected," Samler said.
The company is now examining three components for possible modification -- the
capsule and size of opening, the shock absorber and the gas pressures used.
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