The group is raising pounds 3.82m to further research on three of its most interesting drugs and help shore up a balance sheet which in May was hit by a pounds 1.04m deficit on the profit and loss account. The placing and open offer through mini-merchant bank English Trust is being offered to existing shareholders on a one-for-15 basis at 90p a share.
The company's best near-term prospect is a treatment for rheumatoid arthritis, which has shown promising results in human trials. Of 33 patients who used the drug, 76 per cent showed an improvement that lasted from one to nearly three years in individual cases. The second-phase trials begin next year and if KSB can do a licensing deal with a big pharmaceuticals group in 1997, the drug could be on the market by the following year.
With an osteoarthritis drug also under development, KSB would be attacking a combined market currently worth around $6bn world-wide if it is successful. In its favour, both the "new" compounds are actually one or more old drugs already approved for use against different ailments, thus allowing what is usually a long-winded approval process to be circumvented to some extent.
KSB is also developing what could be an interesting line in monoclonal antibodies developed in sheep, claimed to be a more effective way of delivering anti-cancer drugs than existing methods. But it is up against formidable opposition from others attacking the same markets with novel compounds. The market is thin, with founder Dr Kim Tan sitting on 70 per cent of the equity after the placing, and the shares, up 7p at 108p, remain speculative.Reuse content