Chemeq, Metabolic boosted by timely good news
Wednesday, 20 April, 2005
Shares in two of the biotech sector's most troubled companies Chemeq (ASX:CMQ) and Metabolic Pharmaceuticals (ASX:MBP) rose today by 20 per cent and 15 per cent respectively, as the companies announced positive news.
The much-anticipated Australian Pesticides and Veterinary Medicines Authority license for Chemeq's Rockingham manufacturing facility finally came through, allowing the company to fulfil the first part of its AUD$60 million rescue by Japanese investment group Mizuho International and to supply a $1.5 million contract for its polymeric antimicrobial to a South African company.
Chemeq will now be racing to make further sales under distribution agreements in South Africa, New Zealand and Malaysia in order to meet a further condition of the Mizuho deal, to obtain confirmed sales orders for a minimum of 40,000 litres of the antimicrobial in the 2005-2006 financial year by the end of September.
Earlier this month, Chemeq banked AUD$40 million from an issue of 40,000 convertible bonds to Mizuho and related entities of investment management group Stark Investments.
No rebound weight gain in Phase II obesity trial
Meanwhile, a follow-up study of the the Phase IIb trial of Metabolic's obesity drug AOD9604 has shown that patients maintained their weight loss for 12 weeks after they finished treatment.
The company also confirmed that results from follow-up laboratory experiments have been consistent with the puzzling bimodal dose-response data observed in the Phase IIb trial.
The human Phase IIb trial data showed that although the 1mg dose delivered the greatest mean weight change of 2.8kg, the second best mean weight change was produced by the highest 30mg dose, an outcome that has perplexed both independent analysts and the company itself. Analysts also criticised the statistical significance of the Phase IIb results, and strong selling has pushed the share price down from a high of $2.50 down to its current $0.65 levels.
The company said its AOD9604 data is to be presented in June at the American Diabetes Association meeting in San Diego. Metabolic has confirmed that it will perform a further dosing study of its anti-obesity drug AOD9604, but a final decision on the protocol must await the outcome of partnering discussions.
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