Venn Life Sciences Holdings plc (LON:VENN) has unveiled plans to raise £4.5mln via a share placing. The cash will be used to bankroll and grow the enlarged group following the takeover of corporate financier Cathal Friel’s latest venture, a firm called Open Orphan.
Friel is reversing the company into Venn in a £5.7mln all-paper deal to bring to the market his platform that helps pharma companies commercialise their products in Europe.
"The placing will allow the new management team, who have a strong track record, to realise the full potential of the enlarged group,” the Irish entrepreneur told investors.
“We are excited by the growth potential as we seek to build a leading full-service, Europe wide, high margin consultancy offering services to the fast-growing orphan drug market."
More than 80mln shares will be sold at 5.6p each in the City fundraiser arranged by Arden Partners. Venn Life shares, which had been suspended on AIM, saw trading restored this morning and celebrated with a 107% leap to 5.50p in early deals.
Since then more than £2.7mln has been invested into the business, most of which has gone on building a database of all the firms with so-called orphan drugs that treat rare diseases that have either been approved or are currently going through the clinic.
The entrepreneur and his team have also put together a 4,000-strong directory of physicians and key opinion leaders with expertise in marketing and selling orphan drugs.
Normally the drug developers would have to pay a handsome fee to a third-party which would help find those experts, but the company intends to undercut the market with a cheaper annual subscription which gives the companies access to the platform.
At the moment, it is more of a ‘virtual rep’ service, which can be used to support the launch of new products or to promote mature brands.
But Friel and his team want to grow the company into a full-service consultancy for orphan and rare disease drugs.
In a separate announcement, Venn published its results for the year ended December 31. These showed revenues fell sharply to £12.8mln from £15.89mln, resulting in an after-tax loss of £4.3mln.
-- Adds resoration of trading, share price --