INTERVIEW-UPDATE 1-OctoPlus sees 2010 or 2011 profit
Friday June 26, 2009 04:20:16 PM GMT
* One-off costs at Biotech group will prevent profit in 2009
* Looking to agree new licensing deal by end of year
* Sees a lot of headroom in sales and share price
(Adds CEO comment, shares, details)
By Aaron Gray-Block
AMSTERDAM, June 25 (Reuters) - Dutch biotech company OctoPlus said on Thursday it would be profitable in 2010 or 2011 and it was aiming to agree a licensing deal on its treatment for middle ear infection by the end of the year.
"We're cash positive on an operating level," Chief Executive Simon Sturge told Reuters, but added OctoPlus will not make a profit this year due to one-off costs from the opening of its new and bigger manufacturing facility.
Asked when OctoPlus would make a net profit Sturge said: "It will be in 2010 or 2011." OctoPlus will provide specific guidance early next year.
The company, which provides technology for the controlled release of other companies' injectable drugs or vaccines, raised 6 million euros in a share issue in February after a turbulent 2008 in which it needed bridge financing to avert cash problems.
Shares in OctoPlus, which is targeting 19 million euros ($26.5 million) in sales this year up from 16.9 million last year, are up 70 percent since the start of the year.
Sturge said the company is now in active talks with several parties over its treatment for chronic middle ear infection and the company aims to secure a deal before the end of the year.
In October, OctoPlus agreed to license its share of the commercial rights for its lead product Locteron, which treats patients with chronic hepatitis C, to development partner Biolex Therapeutics in a deal worth up to 108 million euros in sales and fees, making the company cash positive.
Locteron targets a market of $5 billion, while the middle-ear infection treatment targets a market of about $500 million and Sturge said the proceeds of a deal on the ear infection treatment would be lower than the Locteron deal.
Sturge said he expects phase IIb studies into Locteron will end in 2010, allowing phase III studies to begin in early 2011 at the latest. The drug could enter the market in 2013.
While Locteron will be the initial earnings driver, Sturge wants to have in three to five years a portfolio of products developed by customers using its technology.
Sturge did not speculate on whether OctoPlus could be a takeover target, but said there are several reasons why acquisitions take place, including the technology.
"If the platform technology is strong enough there are enough companies investing in a portfolio of products where our technology may have a good application for them," he said.
"We view there is quite some substantial headroom to go," in both the company's share price and its earnings, Sturge said. (Editing by Jon Loades-Carter)
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