UK biotech Alizyme plc bucked the market in London to raise £10 million in a placing. The company issued 20 million new shares at 50 pence each, a slight premium on the quoted price.
The company is close to agreeing a licensing deal for its lead product, Cetilistat, an anti-obesity treatment that has the same mode of action as Roche’s Xenical. It has just received approval from the FDA for the Phase III development programme. More importantly, the FDA reversed an earlier ruling that the product could not be developed for the treatment of Type II diabetes.
The decision vastly increases the commercial potential of the drug, since it is much easier to get reimbursed for diabetes drugs than for weight loss treatments. Tim McCarthy CEO said the top ten pharmaceutical companies are all interested in Cetilistat, and he expects to complete a deal soon.
Alizyme will not go ahead with the Phase III programme until it has a partner. McCarthy, CEO said the new money will reinforce the company’s finances while the deal completes. “We are delighted with the strong support shown in this placing by our leading UK institutional shareholders."
He added that the cash provides the company with financial stability, supporting the negotiation of optimal deal terms on the out-licensing of its products.
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