Skyepharma's asthma delivery system could be a $500m blockbuster
Monday 12 January 2009
There are countless companies that are no doubt glad to see the back of 2008, even if they are a little uncertain about what 2009 might bring. One of them is certainly the biotech group Skyepharma, whose annus horribilis last year saw its share price collapse under the weight of two convertible bonds worth £89m, on which investors had put options, exercisable this year and next.
The shares dropped from a year high of 744p to 116p, with some analysts predicting last year that had the bond investors so desired they could have forced the company out of business.
Indeed, last July, when the group's share price fell 32 per cent in one day – in pre-Lehman-collapse times, such falls were still considered astronomical – as talks between the company and its bondholders collapsed, the writing appeared to be on the wall.
So what a difference a few months makes. The group has always relied on its potential blockbuster asthma delivery system Flutiform, which was perhaps what saved the group from collapse, as investors recognised that Skyepharma was worth saving, and eventually renegotiated the terms of the deal by putting back the put dates on the bonds by several years.
Since the deal was struck, the news has got even better. Last week, a treatment called Lodotra, which treats arthritis and joint stiffness, was given approval to be used in Europe. The medicine uses Skyepharma's "Geoclock" technology, which ensures that the treatment takes effect at the necessary times.
While the group will not be able to suddenly pay back those troublesome bonds on the back of Lodotra's success – the company will receive a single-digit percentage royalty on net sales – it is at least a further step back from the precipice.
The group is desperately hoping that its filing for Food and Drug Administration approval for Flutiform, which is expected in before the end of March, is successful.
While the earnings from Geoclock will be welcomed, it is still Flutiform that excites analysts, with those at Piper Jaffray saying that the treatment could be worth as much as $500m (£328m).
- 1 Half of young women unable to ‘locate vagina’ and 65% find it difficult to say the word
- 2 Perez Hilton apologises for Jennifer Lawrence naked photo leak
- 3 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
- 4 Mexican woman becomes world’s 'oldest person' at 127
- 5 Jennifer Lawrence 'naked sex video' will be leaked threatens 4Chan celebrity photo hacker
Rotherham child sex abuse scandal: Labour Home Office to be probed over what Tony Blair's government knew - and when
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Ashya King: Parents of five-year-old boy refused permission to visit him in hospital and denied bail at Spanish court
With Douglas Carswell joining Ukip, my party has taken another giant step forward
When elitism grips the top of British society to this extent, there is only one answer: abolish private schools
Ukip Douglas Carswell defection: Tory MP jumps ship to join Nigel Farage
iJobs Money & Business
£40000 - £50000 per annum + benefits+bonus+package: Harrington Starr: SQL Impl...
£85000 per annum: Harrington Starr: Head of IT (Windows, Server, VMware, SAN, ...
£40000 - £50000 per annum: Harrington Starr: You will not be expected to hav...
£500 per day: Harrington Starr: SQL DBA/Developer SQL, C#, VBA, Data Warehousi...