Frontier IP (FIPP:58p), a company that provides a range of commercialisation services to university spin-outs in return for ‘free equity’ stakes, has produced eye-catching first half results. The fair value of its investment portfolio increased by 25 per cent to £17.1m, buoyed by £3m of unrealised investment gains, to deliver a two-thirds rise in pre-tax profits to £2.1m, lift EPS by almost half to 4.66p. Net asset value of £23.6m (46.6p per share) was up 20 per cent on the same six-month period of 2018.
The Vaccine Group (TVG), a spin-out from University of Plymouth, is a good example of how Frontier IP focuses on validating technology and, through early industry engagement, understanding how it can be scaled up. Backed by £9m of grant funding from the Chinese, UK and US governments, TVG is developing novel vaccines based on benign forms of herpesviruses that are found in all animals, including humans. They are created by inserting a non-infectious region of DNA from the pathogen being targeted into the herpesvirus. The vaccine then stimulates an immune response against the disease when delivered into the animal. Targeted diseases fall into two broad areas: zoonotic diseases, such as Ebola, bird flus and SARs, that jump from animals to animals, including humans; and diseases, such as African swine fever and bovine tuberculosis, which impact economically important livestock.
TVG is working in partnership with Shanghai Veterinary Research Institute and Kansas State University on coronavirus vaccines for use in animals to prevent COVID-19 re-emerging from animals to infect humans again. It could be a game changer. TVG raised £680,000 post period end to value Frontier IP’s 17 per cent stake at £1.6m.