Open Orphan spin-out Poolbeg Pharma to list on London market

Company will use money from listing to meet costs for flu drug trials, develop assets

Dublin-listed pharmaceutical services company Open Orphan will seek admission of its spin-out company Poolbeg Pharma to trade on the London Stock Exchange's AIM, using the funds raised to meet the costs of the clinical trials for its flu treatment.

Poolbeg Pharma, which will focus on infectious diseases, will have POLB 001 as its lead asset, a small molecule immunomodulator for severe influenza that is phase-II ready, according to the company.

This will be the third life science company founded by and coming out of the Cathal Friel and Raglan Capital stable, following Amryt and Open Orphan.

Open Orphan said on Monday it intended to make a distribution in specie of the share capital of its Orph Pharma IP Company Limited subsidiary to Poolbeg Pharma. That followed the court approval in May for a reduction in capital as part of the process to spin out the assets. The company previously said it believed the assets in question were best developed separately from the core services businesses to maximise shareholder value. The infectious disease market, which Poolbeg will target, is expected to be worth more than $250 billion by 2025.

The funds raised from the listing will also allow the company to acquire or license additional assets and technologies as appropriate.

Cathal Friel, who is non-executive chairman of Poolbeg, will participate in the initial public offering (IPO) alongside incoming investors.

“Poolbeg’s approach to asset development should result in good licensing opportunities and excellent returns in a relatively short period of time with substantially less risk than the traditional biotech model, and allow for regular investor newsflow,” he said. “ In addition, in Poolbeg we have assembled a leading management team, generated an exciting pipeline of potential acquisitions and entered advanced discussions with leading AI data analysis platforms to increase the attractiveness of the company and its offering. Thus, I am confident and excited in the company’s prospects going forward and will be personally investing alongside incoming investors as part of the potential IPO.”

Jeremy Skillington will head up the new entity as chief executive. Mr Skillington was previously vice-president of business development at Inflazome, which was acquired by Swiss multinational healthcare company Roche for €380 million in 2020.

“The Covid-19 pandemic has placed the issue of infectious diseases firmly in the public eye. Governments and international organisations are now investing heavily to ensure they are better prepared,” said Mr Skillington. “Poolbeg Pharma is aiming to carve out a leading position in this rapidly evolving and expanding sector. We have an excellent heritage in infectious diseases and a management team with a track record of delivering value creation.”

2020 results

Separately, Open Orphan published its results for the year ended December 31st, 2020, which saw the group narrow its losses at its Open Orphan and subsidiary hVivo. Its main Open Orphan unit saw revenue fall from £8.6 million (€10 million) in 2019 to £7.8 million (€9.1 million) in 2020, but losses narrowed to £5.8 million (€6.8 million) from £6.6 million (€7.7 million) a year earlier. Revenue at its hVivo unit was down from £15.1 million (€17.6 million) in 2019 to £14.5 million (€16.9 million) last year. Losses fell to £4.9 million (€5.7 million) in 2020, down from almost £7 million (€8.2 million) a year earlier.

The group said it had strengthened business development, restructured underperforming businesses and integrated support functions across the group.

It also had a number of major contract wins in 2020, putting it on track for strong revenue growth in 2021.

The fourth quarter also saw an operating profit, with the group targeting full-year profitability in 2021.

Ciara O'Brien

Ciara O'Brien

Ciara O'Brien is an Irish Times business and technology journalist