Vectura registers interest in SkyePharma

Vectura, the biotech company best known for its "inhaled Viagra" products, has asked for merger talks with SkyePharma, the bigger drug development company which has put itself up for sale.

The emergence of a new, small suitor comes amid investor demands for SkyePharma to speed up the auction process and accelerate the departure of Ian Gowrie-Smith, the long-standing chairman whose relations with the City have become increasingly strained.

Vectura has asked Lehman Brothers to give it access to financial data on SkyePharma with a view to a combination with some or all of its businesses. It is thought to be positioning itself to acquire certain assets in the event that Lehman Brothers proposes a break-up rather than a sale of the company.

SkyePharma specialises in finding new ways of delivering existing drugs, and owns a portfolio of controlled-release tablet and inhaler technologies. Vectura's novel inhaler has been licensed to Novartis and it has a business relationship with GlaxoSmithKline. Its market value is £91m, compared to more than £360m for SkyePharma.

Innovata, whose merger approach prompted SkyePharma to put itself up for sale, has so far been frozen out by Lehman Brothers.

David Lis, the fund manager at SkyePharma's 5.2 per cent shareholder Morley, said the company needed to signal "in the next few days" that it will progress talks to merge with or acquire Innovata and install its management in top positions. "I don't see why SkyePharma is not gently pursuing talks with Innovata. They have nothing to lose and Innovata's management would offer a credible alternative."

Although sources close to SkyePharma say Mr Gowrie-Smith's future is not on the agenda at a board meeting tomorrow, they say he has accepted his time at the helm is drawing to a close.