Placed at 33p each, the shares are now changing hands for 44p, having briefly gone above 50p earlier this summer.
According to the broker Numis, the current market worth of Abzena is scant reflection of its true potential. It has a price target of 93p a share, which would value the business at £198mln.
It made the call last month, shortly after Abzena inked a tie-up with OBI Pharma potentially worth £540mln (US$700mln) – its fourth deal involving its ThioBridge technology.
ThioBridge is an antibody drug conjugate linker, which, in layman’s terms, means it attaches antibodies and other proteins to drugs.
The company operates a hybrid model, which means its revenues come from providing antibody research and engineering services and creating drug conjugates (targeted treatments for diseases such as cancer). It also manufactures antibodies and proteins for clinical studies.
Where Abzena applies its technology to re-engineer a partner’s product it might earn licence fees, milestone payments and even royalties if a drug makes it to the market. Where its technology is embedded, the firm calls these ‘Abzena inside’ products.
In fact a new ‘Abzena inside’ product entered Phase I clinical development recently, which means it now has 12 clinical-stage products. Two of these are in Phase II.
Use of proceeds
The £25mln placing of new shares will help accelerate the business towards “sustainable profitability”.
Specifically, it will be used to upgrade and expand Abzena’s US based bio-manufacturing facilities and capabilities.
Funds will also be ploughed into existing services in America and the UK as well being used for business development.
"Our existing and prospective customers are developing novel but complex biological therapies for a wide range of diseases, from rare genetic childhood disorders to cancer,” said CEO Burt.
“Our experience and reputation as a biopharma service and technology provider continues to grow and as a result our customers' demand is currently outstripping our capacity."