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Birmingham Post
Birmingham Post
Business
Tom Keighley

Shield Therapeutics secures £15.1m in raise and seals deal with healthcare company

Gateshead drug manufacturer Shield Therapeutics has raised £15.1m (18.5m) via an oversubscribed share placing and subscription, just hours after announcing the move.

Having revealed its intention to raise £14. 7m from the London Stock Exchange on Tuesday morning, by late afternoon the firm confirmed it had surpassed the target. A total of 182,939,917 new ordinary shares of were placed and major shareholder AOP Health International Management AG along with a handful of Shield directors and some employees subscribed for a total of 68,555,461 shares at the issue price of 6p - a discount of 11.1% on the price at the close of the market on Monday.

In tandem, an open offer to existing shareholders aims to raise £3.9m and may also see a further 64,346,927 new ordinary shares issued. And Shield said it had extended its convertible debt facility with AOP Health International Management AG by $10m.

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The moves came as Shield also detailed a major partnership agreement intended to build its US market share. It has joined forces with US pharmaceuticals firm Viatris to tackle the American market with its iron deficiency products. The North East firm estimates it can sell $150m of its Accrufer capsules to the US by the end of 2025.

The two firms will put forward a combined team of 100 sales people to promote the drug, which treats iron deficiency anaemia. They will target around 12,000 health care professionals who write the majority of oral iron prescriptions in the US.

Before the equity fundraise had taken place, Shield said the value of the share subscription and placing, the extended shareholder loan facility and the Viatris partnership amounts to about $37.7m. Around $13m of that will be used to fund 50 of the field salespeople needed for the Viatris partnership, while $8m is earmarked for marketing; $3m for what it called "expansion of market access and distribution channels", and $8m will be put towards working capital needs.

In a connected update on the performance of Accrufer, Shield stated: "In the nine months to September 30 2022, Accrufer has generated unaudited net revenues in the US of $2.4m. Other unaudited revenues generated in the nine-month period amount to circa £0.8m generated from royalties from sales of Feraccru in Europe and a £0.2m license upfront payment from its commercial partner in Canada.

"Shield expects to recognise as revenue the $5m upfront payment from Viatris in the current financial year. Shield's unaudited cash balances as at November 30, 2022 was approximately £0.7m."

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