Investment: Tab may be worth a bite

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The Independent Online
HISTORY SUGGESTS that anyone thinking of investing in Therapeutic Antibodies should take a couple of aspirin and lie down.

Better known as Tab, so far the company has specialised in anti-venom antidotes, but it has yet to find an antidote for a falling share price. Floated at 500p in 1996, the shares crashed 30p to 55p on yesterday's news of a rescue cash injection of pounds 11.5m. That included an issue of 21.3 million shares at 40p, while debt and preference shareholders are being asked to convert pounds 4m into ordinary shares.

Swallow hard, however, and Tab may be worth a look. For a start, it has heavyweights on the board in the form of the new chairman, Stuart Wallis, and new-ish chief executive Andrew Heath. Mr Wallis most famously sold Fisons to Rhone-Poulenc in 1995. Dr Heath's background is with Glaxo and Astra.

Two meaty industry names have also signed development agreements. US group Altana will pay $23m (pounds 13.6m) if Crotab, a treatment for the 40,000 rattlesnake bites that occur in the US each year, takes off.

GD Searle will cough up $8m if Tab can deliver on an antidote to a new, but unnamed "potential blockbuster" it launches next year. Searle wants the antidote in case patients need to come off the treatment quickly, to have surgery, for instance.

Stockbroker Panmure Gordon - which admittedly is underwriting the share issue - has come up with some punchy numbers. It predicts sales of pounds 15m and a small profit in 2000, growing to profits of pounds 28m in 2003.

Tab's management team is doing sensible things, such as seeking a partner for its expensive septic shock treatment. This means that Tab's net cash, which will be pounds 7m after the fundraising, will be enough to last it for the next 18 months. If you like high risk and potential high returns, the shares are worth a bite.

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