Cash-poor Prima plans for agreements

Despite capital raisings and exercise of options totalling $7.3 million during the year, Prima Biomed (ASX: PRR) is down to a cash balance of $2.8 million after posting a net loss of $4.9 million for the 2003-2004 financial year.

But CEO Marcus Clark said the cash should last for at least six months, and the company is deep in negotiations with major pharmaceutical companies to make a deal around the technology under development by Prima subsidiary Arthron.

"We were hopeful that something would happen last quarter, but it didn't ... we are targeting this quarter," Clark said. "Large pharmas are in a world of their own -- it can be a drawn out process to get through the [bureaucratic] layers."

Prima's bottom line was also affected by the timing of some of its payments, he said, which included prepayments for development work.

But the company's revenues were up by more than 200 per cent to $458,000, reflecting the BIF grant awarded to Prima and fellow biotech company Prana Biotechnology for the development of an Alzheimer's vaccine utilising Prima subsidiary Panvax's adjuvant technology.

Clark said Prima was also awaiting the outcome of two applications for BIF grants in the current round.

The company and its subsidiaries have been making steady progress. CancerVac has recently commenced recruitment for a Phase II clinical trial of its therapeutic vaccine in ovarian cancer, after netting a commercialisation agreement with Canadian company Biomira worth up to $20 million.

And Clark said that he anticipated that results from Oncomab's program with US-antibody company Medarex to develop a humanised antibody for the treatment of colon cancer would be announced later this year. Earlier this year the company published the results of animal studies showing that its antibody against the Cripto protein, a member of the EGF family, was able to prevent new tumours from forming and slowed the growth of existing tumours in a mouse model of colon cancer.

Panvax is also expected to enter preclinical development in the coming year, Clark said, and the company is targeting clinical trials in the third quarter of 2005.

"By the middle of next year we'll have two products in clinical trials," he said.

Clark also noted the company has strengthened its patent portfolio this year, with 10 patents granted in various jurisdictions bringing the total to 37 granted patents and 59 patent applications pending.