Drug development services provider hVIVO PLC (LON:HVO) has its strongest sales pipeline for several years, according to chief executive Trevor Phillips.
At the start of October, the human disease model specialist won new contracts worth £9mln for two respiratory syncytial virus (RSV) human challenge studies.
That followed an £11.9mln RSV study agreement signed in September, again with an unnamed group.
Contagious, respiratory syncytial virus causes the common cold, for which there is no effective cure.
The £11.9mln contract will start to contribute from October and throughout 2019.
“We are experiencing a lot of interest from leading pharmaceutical companies for the development of new challenge models in RSV, asthma and COPD and we expect to be able to convert a number of these into contracts,” said Phillips.
Revenues in the half year June rose to 26% to £4.9mln, while losses dropped to £5.3mln from £9.1mln as R&D spending was reined back, something that will continue in 2019, Phillips said.
Cash holdings at the half year were £10.7mln.
FLU-v nails phase II trial
hVIVO got a major boost in June when flu vaccine FLU-v performed strongly in a Phase II trial.
Talks are now underway to find a partner or even sell Imutex, the joint venture with SEEK that is developing FLU-v.
Other options include a licensing agreement or a non-dilutive funding arrangement with a collaborator to run the Phase III development and study for FLU-v.
Imutex is also developing a vaccine (AGS-v) for mosquito-borne diseases and first data from a Phase 1 safety study is due by the end of the year.
Phillips said it has been a good start to 2018 with the group building on its lead position in viral challenge-based human disease models.
“We aim to create a stronger range of services that, alongside our operational efficiencies, will enable hVIVO to be profitable and generate cash from its operations in 2019.”
Challenge trials save time
During a challenge trial, a person’s symptoms, bloodstream, genes are all measured to understand what happens over a course of time when you have an infection such as flu.
People are monitored from healthy to the moment they are infected and subsequently recover, with many samples taken at multiple data points.
The idea is to test if therapies work or give an early indication if a drug will be efficacious.
Phillips says ethics and safety are the prime considerations, which limits the areas they can be used but where appropriate challenge trials are very effective.
COPD or asthma studies can cost £25mln and take two years, whereas hVIVO can carry it out in 5-8 months for £8mln.
Phillips believes hVIVO is one of only a few companies with the model for this type of human challenge study.
Expanding the range of product to boost the revenue stream is the next objective but Phillips is confident enough to predict the company will be in profit by the end of 2019.
“It’s a very specialised offering that we are very good at.
“Profitability next year is the target. A service business like hVIVO that has been around for some time has to start generating cash."