Shares in Allergy Therapeutics (AGY) tumbled earlier this year after the unexpected failure of its birch allergy treatment at the third phase of trials. Remaining “in dialogue” with German regulators, the group has shifted its attention instead to its grass allergy vaccine, due to start its Phase III trial in autumn next year. Success here would be one of the last hurdles before being able to tap into a US market estimated to be worth $2bn (£1.6bn).
It was this product that was the subject of a legal case concerning Inflamax’s handling of an earlier trial. Benefiting from a £6m settlement, operating profit – excluding research and development (R&D) costs) – increased by more than a fifth in 2019 to £11.3m. While R&D expenditure was £3m lower, this is projected to rise in FY2020 as clinical trial activity ramps up – this includes the next trial phase for its oral treatment for dust mite allergy.
The commercial division is somewhat less significant to future growth than progress in the clinical pipeline. Nevertheless, the European business increased its market share by half a percentage point, with higher sales for its Pollinex franchise despite lower incidence of grass pollen last summer.
Broker FinnCap forecasts an adjusted pre-tax loss of £4.1m in 2020, widening to £13.2m in 2021.
| ALLERGY THERAPEUTICS (AGY) | ||||
| ORD PRICE: | 13p | MARKET VALUE: | £ 84.3m | |
| TOUCH: | 13-13.5p | 12-MONTH HIGH: | 25p | LOW: 7p |
| DIVIDEND YIELD: | nil | PE RATIO: | 24 | |
| NET ASSET VALUE: | 5.9p* | NET CASH: | £25.0m | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2015 | 43.2 | 0.7 | 0.02 | nil |
| 2016 | 48.5 | -12.1 | -2.3 | nil |
| 2017 | 64.1 | -2.0 | -0.4 | nil |
| 2018 | 68.3 | -6.9 | -1.3 | nil |
| 2019 | 73.7 | 4.3 | 0.6 | nil |
| % change | +8 | - | - | - |
| Ex-div: | na | |||
| Payment: | na | |||
