Weston Medical shares fall 87% on syringe delays

Shares in the needle-less injections firm Weston Medical collapsed 87 per cent yesterday after it admitted it was facing a cash crisis following a delay in getting its flagship product to market.

Shares in the Cambridge-based firm, which warned the delay had forced it to consider "alternative sources" of funding, plunged 43.5p to close at 6.5p. The bombshell came as Weston Medical admitted its needle-free Intraject device would be two years late in coming to market thanks to a variety of "design modifications".

The necessary changes, which came to light after internal clinical trials, are expected to delay the launch of the product to "at least" mid-2005 from next year, it said.

"Recent internal clinical trial results have demonstrated the need to change certain design aspects of Intraject ... to ensure optimum clinical performance," the company said.

The move left the investment community shell-shocked with analysts questioning the credibility of the current management team, which is led by chief executive Chris Samler, and whether the firm would stick by its new launch timetable.

Dr Robin Campbell, an analyst at WestLB Panmure, said: "Although management have identified some variables that they think are responsible and have a plan to make design changes, we are concerned that there are unquantifiable risks attached to achieving this in a straightforward manner.

"Therefore, the rescheduled initial product launching timing for mid-2005 should only be considered a best guess," Dr Campbell said, estimating Weston Medical could be facing a funding gap in the region of £20m to £30m.

The investment bank Goldman Sachs, one of the company's two house brokers, suspended its rating on the firm, warning investors Weston Medical now faced "financial uncertainty".

A spokesperson said Weston's licensees, including Roche and GlaxoSmithKline, remained "supportive".

Tracey West, an analyst at Evolution Beeson Gregory, said: "Intraject is a good device and still has huge potential, especially in the area of monoclonal antibody delivery."

Shares in Weston Medical, which floated two years ago at 170p, had traded as high as 272.5p at the start of 2001.