Oz vaccines company to raise money on AIM

Australian vaccines company Virax Holdings Ltd is to list on the Alternative Investment Market (AIM), raising £5 million to fund a Phase II trial of its lead product, a therapeutic HIV vaccine.

Melbourne-based Virax has been listed on the Australian Stock Exchange for the past ten years, but has had far from consistent support from investors over the ups and downs of the drug development cycle. Its business model is to fund early stage clinical development of Australian medical research then partner with larger biotechnology or pharmaceutical companies for later stage development, regulatory, and marketing activities.

David Beames, CEO, said that AIM investors are more experienced in biotech. “We are looking to find people who can understand our story a little better.” In particular, Beames believes AIM is a route to attracting institutional investors.

Another problem for Virax is the shortage of biotech analysts in Australia who are able to explain the company’s story to investors.

Clinical trials supplies of Virax’s lead product, VIR201, for treating HIV, have been manufactured to GMP standards in Germany, and are currently undergoing toxicology testing in Scotland. The company intends to apply for permission to carry out a US trial involving 180 patients before the end of 2006.

Virax is planning a further US$6 million trial in South Africa, paid for by donations from a consortium of international companies led by the mining group BHP Billiton.

A second product, VIR501, for treating late-stage hormone refractory prostate cancer, is currently in GMP manufacturing development, with plans for a Phase I/IIa trial next year. A third product, VIR401, for treating Hepatitis B infection, is in preclinical development.

Virax hopes to raise £1 million by the end of September, followed by a further £4 million by the end of 2006. This will fund the company until mid 2009, giving it time to complete the Phase II trial of VIR201 and find a licensing partner.