Biotech moves towards first product launch

British Biotech, the UK's leading biotechnology company, yesterday took a step closer to launching its first product by submitting an acute pancreatitis drug for European approval.

If the application for Zacutex to the European Medicines Evaluation Agency (Emea) is successful, the company could see its first sales in some of the 15 countries of the European Union as early as next spring.

Keith McCullagh, chief executive, described the move as an important achievement for the company, which has yet to make a profit and yesterday unveiled a further pounds 17.6m deficit for the nine months to January.

"It marks a landmark in the history of the company ... While we wait to hear from the Emea, manufacturing and pre-marketing activities are under way in Europe and progress continues with the further clinical development of both Zacutex and Marimastat."

Hopes for Marimastat, an anti-cancer drug in late-stage medical trials, have fuelled a huge surge in British Biotech's shares since November 1995. Zacutex may not be on the same scale as Marimastat but it could still be a big earner if the drug is approved. Some 250,000 people get pancreatitis every year in the US and the levels in Europe may not be far behind, with some 8 per cent of sufferers dying of pancreatitis. Analysts reckon Zacutex could achieve peak sales of between pounds 200m and pounds 300m by early next century.

Further details of the latest UK trial which is being used as the basis for the application will be released on 12 May. A US registration for the drug based on a second trial now under way would follow in due course, the company said.

Analysts were less enthusiastic than Mr McCullagh about yesterday's news and the shares rose just 0.5p to 251.5p. One follower said there had been little new in the announcement and expressed some concerns over the data used to support the Zacutex application. Until further information became available in May it would not be possible to test how rigorously the company had been in differentiating the effects of the disease on the body's organs after the new treatment, he suggested.

Elsewhere, Marimastat is "continuing exactly on track", according to the company.

The nine months' losses, which were said to be "well within budget", compare with pounds 15m for the comparable period of 1995-96 and include a third- quarter deficit of pounds 1.55m, down from pounds 4.05m before. The latest three months saw "turnover" soar from pounds 4.5m to pounds 8.53m after milestone payments totalling pounds 4m from Glaxo Wellcome for a potential arthritis and inflammatory bowel treatment and pounds 4.4m from Tanabe Seiyaku, the company's partner for Marimastat in Japan.

Cash of pounds 193m includes the pounds 143m raised from last year's rights issue.