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LONDON (Alliance News) - Life sciences company hVIVO PLC on Monday said it has made an investment in PrEP Biopharm Ltd in order to continue the development of its PrEP-001 prophylactic compound but said any revenue from from the project will not be booked until 2016.
hVIVO is a life sciences company focused on human challenge models for pharmaceutical and biotechnology companies, which involves inducing infections in healthy volunteers to test the efficacy of vaccines or study the progression of the disease.
hVIVO said it will acquire a "significant" stake in PrEP Biopharm for GBP14.0 million, and PrEP will contract hVIVO Services Ltd to handle a GBP10.0 million phase IIa clinical programme of work on its compound in 2015 and 2016.
PrEP-001 is a nasally-administered treatment designed to prevent upper respiratory tract infections and viruses.
"We are delighted to be continuing the development of this important product, now as a key stakeholder and significant shareholder. Working closely with PrEP, we look forward to leveraging the hVIVO platform to its full potential, accelerating PrEP-001 through its clinical development in order to reach patients soonest," said hVIVO Chief Executive Kym Denny.
The company said, however, that the GBP10.0 million revenue from the programme will not be fully-recognised until the end of its financial year to December 2016.
"In making the transition from service provider to vested owner, it is unfortunate that the accounting technicalities are such that we may not be able to recognise revenue in 2015 for the great work being conducted on this product in 2015. Ultimately this has no net effect, including to cash flow, other than the timing difference of revenue moving out of 2015 and into 2016," Denny added.
Shares in hVIVO were down 2.1% to 260.00 pence on Monday.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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