Avexa to buy 24 percent of Allied Medical

Troubled HIV treatment developer Avexa will pay around $1.5 million to acquire up to 24 percent of Western Australia medical devices company Allied Medical under the terms of a deal revealed this week.

Allied Medical is majority owned by Western Australian iron or magnate Andrew ‘Twiggy' Forest. In July the company announced that it would take a 38.6 percent stake in Queensland-based infectious diseases specialists Coridon, with the option to increase this to 55.7 percent.

Co-founded by and chaired by cervical cancer vaccine co-inventor Professor Ian Frazer, Coridon is backed by the University of Queensland’s commercialisation arm UniQuest as well as the high profile Lieberman family.

Its proprietary DNA technology underpinned development of the revolutionary cervical cancer vaccine Gardasil with treatments for several other diseases currently in the offing. Early this year Coridon applied its DNA technology platform as part of a proof of concept animal study targeting the Herpes Simplex Virus 2 for which it now hopes to develop both a preventative and a therapeutic vaccine.

DNA vaccines have been shown to generate more powerful and broad immune responses than conventional vaccines, while being effective both as a traditional ‘preventative’ or ‘therapeutic’ vaccines to treat people that currently have a disease.

“Our focus on developing new vaccine technologies comes from a belief that there is a growing global market demand for effective vaccines, highlighted by such occurrences as the recent swine flu pandemic,” said Allied Medical CEO, Lee Rodne.

“We believe Avexa’s long-standing focus on drugs for infectious diseases will further strengthen our expansion into this drug development program.”

It hasn’t been the best of years for Avexa however.

In June a group of renegade shareholders moved to topple the then board following its decision to discontinue the company’s program to develop apricitabine (ATC) for the treatment of drug-resistant HIV. It has also faced opposition from key shareholder Calzada, which has accused the current board of incompetence while trying, in vain, to gain a seat on the board.

And while this week’s announcement was well received by investors, Avexa's share price remains something of a disappointment, closing today at at just $0.055.