BTG shares slump 26% over new product delays

BTG, the technology group privatised in 1992, has signalled a further delay to the development of its revolutionary varicose veins treatment, after it botched a trial designed to prove the product is safe.

As a result, the company is having to lay off more than half of the 30-plus staff working on Varisolve, an injectable foam designed to dissolve varicose veins.

BTG, which has a portfolio of investments in technological and medical innovations, raised £27m in a rights issue in February to fund safety trials of Varisolve, a product which it has once expected would be on the market next year. It promised that this would be the last money it would spend, and it would licence Varisolve to a development partner before March.

BTG's shares dived 26 per cent to 98p on fears that the latest setback might jeopardise talks with potential partners.

Ian Harvey, chief executive, said he was disappointed that the trials had not proved Varisolve was safe. However, the company believes the trial design was flawed.

The additional six-month delay pushes the likely launch of Varisolve out to 2010. US regulators halted human trials last year amid fears that gas from the foam was escaping into the bloodstream.