Loans and grants from Spanish authorities could help finance most of the commercial scale-up costs for Midatech PLC’s (LON:MTPH) Q-Sphera technology platform,
Midatech, which is using the platform in its MTD201 drug programme, has a manufacturing facility in Bilbao, which makes it eligible for financial backing from local and national governments.
Midatech has confirmed Thursday that the Basque regional government has approved further funding of €1.5mln in the form of a soft loan – a type of loan that is generally made on terms favourable to the borrower.
The funding follows on from a grant of €450,000 awarded by the local government last year.
The small-cap company told investors that it has also applied for further funding from the Spanish government which, along with the loan, could fund the majority of MTD201’s and Q-Sphera’s development costs if successful.
“This ongoing regional government support enables us to continue and potentially accelerate the progress of MTD201 development towards submission for approval, as well as further develop our Q-Sphera platform,” said chief executive Craig Cook.
“We look forward to continuing the scale-up programme in Bilbao, as we work on driving MTD201 towards the market and establishing Q-Sphera as a leading platform in the multibillion-dollar market for sustained release treatments.”
Still seeking more funding
This latest funding injection helps to shore up Midatech’s cash position. Back in December, bosses said they had enough money in the bank to last through until the end of March.
They did add, though, that they had had “very advanced discussions” with a potential investor in Asia over a possible £8mln investment, while a number of other indications of equity support had also been received.
Midatech repeated today that it is still exploring further funding to support the continued development of MTD201 and provide some extra working capital.
Midatech shares surged 22% to 7.15p on the back of today’s news.