With fledgling healthcare companies, the adage 'cash is king' is particularly apposite. In the case of allergy specialist Circassia (CIR), a £275m fundraising in May 2015 means the scramble to fund its ongoing clinical development programme should be less of a pressing concern. Analysts at Peel Hunt reckon the group has £239m at its disposal to fund clinical trials and the commercial launches of several products in its pipeline. The amount spent on research and development in the first half rose to £18.4m (from £16.4m in 2014).
Results from the pivotal phase III cat allergy trial aren't due until the first half of 2016, and in the mean time Circassia wants to launch its own products commercially - a rarity in the biotech world. The group recently bought Swedish medical diagnostics group Aerocrine for £139m and asthma specialist Prosonix for £100m. The former has established salesforces in both the US and Germany, while the latter is developing several respiratory and chronic obstructive pulmonary disease (COPD) products that are expected to complement products in Circassia's future product pipeline.
In the second half, Circassia wants to grow the US salesforce to 50 people, increasing to 100 by the start of 2017, ready for the launch of the cat allergy treatment later that year.
| CIRCASSIA (CIR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 298p | MARKET VALUE: | £849m | |
| TOUCH: | 298-299p | 12-MONTH HIGH: | 323p | LOW: 246p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 152p* | NET CASH: | £136m | |
| Half-year to 30 June | Turnover (£k) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 0.0 | -19.6 | -11.0 | nil |
| 2015 | 574 | -26.0 | -11.0 | nil |
| % change | - | - | - | - |
Ex-div: na Payment: na *Includes intangible assets of £267m, or 94p a share | ||||
