Angel Biotechnology ‘needs partners by March’

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LIFE sciences firm Angel Biotechnology warned that it will run out of cash and be forced to cease trading if it doesn’t clinch two strategic deals by the end of March.

The Edinburgh group, which reported widening losses in its last half-year update, has already progressed plans for a joint venture with Russian firm MMH but the contract is yet to be signed.

At a general meeting yesterday chairman Nick Smith revealed that Angel also needs another “strategic relationship” to develop its contract manufacturing (CMO) business.

He said the company has “for some time been” in discussions with an unnamed consortium of overseas organisations who could invest up to £1 million.

Smith said: “The pre-funding arrangements need to be concluded rapidly and the agreements for both the MMH joint venture and the CMO business strategic partnership need to be concluded before the end of March 2013 given the cash currently available to the company.

“In the absence of other developments, failure to conclude either agreement or their respective pre-funding arrangements will make it impossible for the company to continue trading.”

He said that while no assurances could be made, the board was confident that both deals would be struck.

Last month Angel unveiled pre-tax losses of £2.9m for the six months to 30 September following a £2m “write-back” on the value of contracts that will be transferred to its joint venture with Russian drugs firm MMH. The deficit during the first half of the previous financial year had been just £241,000.

The losses came despite staff taking pay cuts in the first six months of the year while the firm restructured, during which some workers were made redundant.

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