Angel Biotechnology Holdings Plc Trading Update (0347P)
October 19 2012 - 1:00AM
UK Regulatory
TIDMABH
RNS Number : 0347P
Angel Biotechnology Holdings Plc
19 October 2012
19 October 2012
Angel Biotechnology Holdings plc
("Angel" or "the Group")
Trading Update
On 14 September 2012 the Group announced in a market update the
status of operations and developments covering the whole of the
Group's activities. The Group intends that it shall provide regular
announcements of the progress of such activities.
In the 14 September 2012 announcement the Group described the
market conditions as very difficult and there has been little
change since then with funding constraints of clients forcing
delays and changed priorities with a number of potential customers.
However, the Group is currently seeing an upturn in the volume of
enquiries and bids, especially in areas opened up by the Group's
wider commercial offering in biomedical collagen. The Group is
focusing its efforts on the conversion of those opportunities which
are adjudged to be the least dependent on external factors such as
funding and offer the most immediate prospect of contracts to fill
its facility at Cramlington and to utilise capacity at Angel
Biomedical Limited. The Group anticipated that one of the first
projects to be undertaken at Cramlington following receipt of its
license was the contract with TransGenRx Inc. (Baton Rouge, USA),
announced on 17 April 2012, for the development and scale up of a
recombinant interferon product. The Group has reason to believe
that TransGenRx Inc. is not currently in a position to proceed with
the contract and, although the contract is still in place, the
resulting delay to the start of commercial operations at
Cramlington will have an adverse impact on earnings in the current
financial year. The Group shall continue to press TransGenRx Inc.
for a resolution of the current inactivity and will report as soon
as TransGenRx Inc. has clarified its situation.
The Group continues to make good progress towards finalising the
joint venture that will encompass the product development contracts
for OOO "NPF Materia Medica Holding" ("MMH"). This joint venture
was first announced in October 2011 and the Group is aware that the
elapse of time has created some uncertainty in the marketplace. The
proposed joint venture covers contracts and resources that
currently form a substantial part of the Group's business and every
care is being taken to ensure that the joint venture agreements
will present an optimal result not only in the balance of
commercial terms between the parties but also in providing a
practicable and sustainable working relationship going forward and
all this has taken time. At present the final versions of the legal
agreements covering the joint venture and the services to be
provided by Angel to the joint venture are being worked through and
MMH has placed a project manager with Angel to oversee the smooth
transfer of work from Angel to the joint venture. The Group's
priority is that the joint venture is completed before the end of
the calendar year and it is assured that this matches the
intentions of MMH. In the meantime the Group is continuing to work
on the contracts with MMH under the agreement announced on 14
September 2012 as a prelude to transferring the contracts and their
work in progress into the joint venture. The agreement provides for
a monthly fee structure which has been designed to be broadly cash
neutral in line with the transfer of commercial risks to the joint
venture.
The operational resource review, including staff
rationalisation, announced on 14 September 2012 continues and, as
the Group announced on 12 October 2012, has reached board level.
The new Chairman will be actively working with the Executive team
over the current and next quarter to conclude the review and
execute a strategy to deliver the shortest and most sustainable
route to positive earnings. A particular challenge is balancing the
need to maintain levels of capability in the core contract
manufacturing business, which costs money, against the current
capriciousness of the core business market. Staffing levels will
have fallen to 24 by the end of November 2012 from an average of 37
as reported in our Annual Report and Accounts for the period ended
31 March 2012 and, whilst the staff reduction also reduces the
Group's cash consumption, the Group does not desire or expect to
see it fall much further. Therefore, the next phase of the review
is cautiously to build up and reinforce capability in the locations
of the Group's future growth.
Mr Nicholas Smith said: "In the next few months the Group has to
deliver the joint venture involving the MMH product development
work and execute a strategy that broadens our commercial offering
and reduces our exposure to uncontrollable third party risks.
Success in the completion of the tasks and delivery of earnings is
fundamental and the board and the Group's management are clear on
what is expected of them."
For further information:
Angel Biotechnology Holdings plc
Nicholas Smith, Chairman +44 (0) 131 445 6077
enquiries@angelbio.com
Grant Thornton, Corporate Finance
Colin Aaronson / Melanie Frean +44 (0) 20 7383 5100
Hybridan LLP (Broker)
Claire Noyce, Deepak Reddy +44 (0) 20 7947 4350
Media enquiries:
The Communications Portfolio Ltd
Philip Ranger / Caolan Mahon +44 (0) 20 7536 2028 / 2029
Philip.ranger@communications-portfolio.co.uk
Notes to Editors:
Angel Biotechnology Holdings plc is a full service contract
bio-manufacturing partner to biotechnology and pharmaceutical
companies worldwide. Angel specialises in advanced biologics
including biopharmaceutical proteins and cell therapies, such as
cellular vaccines and stem cells. At present, Angel's products are
principally used in pre-clinical studies and clinical trials with a
view to becoming the contract manufacturer of choice on a
continuing basis.
Drug development companies outsource their biopharmaceutical
manufacturing requirements to Angel to reduce their own capital
requirements and enable them to develop products more rapidly. In
addition, Angel provides complete regulatory services and
documentation to its customers while its manufacturing processes
adhere to the most stringent regulatory requirements. Products are
produced to current Good Manufacturing Practice (cGMP) standards as
required by the US Food and Drug Administration (FDA), and in
facilities that are certified to European standards by the
Medicines and Healthcare products Regulatory Agency (MHRA).
Its customers range from early-stage biotechnology companies
including ReNeuron plc and US-based Pathfinder Cell Therapy, to
established pharmaceutical companies such as Russian-based Materia
Medica Holdings.
Angel has three facilities: Pentlands Science Park near
Edinburgh, a site in Cramlington, near Newcastle-upon-Tyne and
Angel Biomedical Ltd facility in Glasgow.
More information is available at www.angelbio.com .
- Ends -
This information is provided by RNS
The company news service from the London Stock Exchange
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