24th Apr 2018 09:59
LONDON (Alliance News) - Respiratory disease-focused Circassia Pharmaceuticals PLC reported Tuesday a narrowing of its loss for 2017 on a doubled revenue with sales progress in the US and China.
In addition, the group said that FTSE 100-listed pharmaceutical giant AstraZeneca PLC has agreed to amend the development and commercial agreement first signed in March 2017 for Circassia to secure US rights to two of AstraZeneca's chronic obstructive pulmonary disease products, Tudorza and Duaklir.
Subject to shareholder approval, AstraZeneca will subscribe for new Circassia shares, bringing its holding to 19.9% from 14.2%. The subscription amount will go towards the outstanding deferred research and development costs payable to AstraZeneca by Circassia under the agreement, which totals USD45.0 million.
The loan amount will be amended as well as the repayment period being extended to five years from three, as well as Circassia's option to secure exclusive commercial rights to Tudorza in the US, to allow the company added flexibility.
For 2017, Circassia's pretax loss narrowed to GBP120.1 million from GBP144.9 million in 2016 as the company reduced its sales and marketing costs to GBP50.1 million from GBP104.7 million, but increased its research and development expenses to GBP103.0 million from GBP46.2 million.
Revenue however doubled to GBP46.3 million from GBP23.1 million the year before, due to double-digit growth in sales, particularly with an 18% increase in NIOX, and contributions from the sale of Tudorza, through Circassia's collaboration with AstraZeneca.
"With our revenues doubling in 2017 and our cost containment measures delivering tangible savings, we are driving our business towards self-sustainability. We intend to maintain this progress during 2018. We have refocused our investment strategy to support the ongoing expansion of our commercial platform, particularly in China, whilst reducing our R&D and corporate costs," said Circassia Chief Executive Steve Harris.
"During 2018, we will benefit from a full year's contribution from our enlarged US sales team and our collaboration with AstraZeneca, 'locking in' significant growth potential. With a strong commercial infrastructure, compelling portfolio and increasingly attractive platform for third-party products we look forward to the coming year with great optimism," Harris added.
Shares in Circassia Pharmaceuticals were up 3.6% at 91.36 pence. AstraZeneca, which unrelatedly reported mixed drug test results Tuesday, was down 1.0% at 4,962.00 pence on Tuesday.
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