James Noble, finance director, said the development was a sign of the progress made in British Bio-tech's testing programme. 'There's no possibility of a drug getting recognised in the States without doing US clinical trials,' he said.
The new US company will operate from Annapolis in Maryland, a short drive from the FDA's Washington offices. It will also be close to other important medical centres, including the National Institute of Health and the National Cancer Institute.
The US operation will be headed by Peter McCann, who joins British Bio-tech after 20 years in the pharmaceutical industry with Marion Merrell Dow in the US and Europe.
Recent animal tests on virus- like particles have encouraged British Bio-tech to believe its Aids treatment, p24-VLP, can induce the response needed to combat viral infections.
Testing of the company's ovarian cancer product, Batimastat, has shown it to be well tolerated. Tests also suggest it could be used against a much wider range of cancers.
British Bio-tech's latest results show a second-quarter loss increased from pounds 1.8m to pounds 4.6m, which the company said was in line with its expectations. This means the loss in the six months to 31 October is up from pounds 4.7m to pounds 8.8m.
Analysts expect the company to lose about pounds 20m this year, as its drugs enter more costly testing in the later stages. British Bio-tech still had cash of pounds 39.3m at the end of the half.
The group incurred a pounds 142,000 loss on the July sale of its manufacturing business to Techne Corporation. This has left it with negligible turnover.