LONDON (Alliance News) - Midatech Pharma PLC reported a narrowed interim loss as it planned to divest its US unit to become a "pure play biotech company".
Total revenue for the six months to June 30 rose to GBP549,000 from GBP473,000 as the company's pretax loss narrowed slightly to GBP6.5 million from GBP6.7 million a year earlier.
Research & development costs rose to GBP4.6 million from GBP4.2 million, as administrative costs fell to GBP2.1 million from GBP2.7 million.
Looking ahead, the company said the year promises to be an "important foundation for unlocking and delivering" the full potential of its technology platforms and programmes. Clinical data is expected on three programmes, for carcinoid cancer, brain cancer, and its autoimmune diabetes vaccine.
Separately, the company said it has agreed to sell Midatech Pharma US Inc to Kanwa Holdings LP, an affiliate of Barings LLC, for up to USD19 million.
Of this sale price, USD13 million will be paid as initial consideration and up to USD6 million based on the unit's net sales performance in 2018 and 2019.
Net proceeds from the sale will be used to fund key research & development priorities, said Midatech Pharma, such as the MTD201 Q-Octreotide and MTX110 programmes toward their next development milestones, as well as repay an outstanding loan to MidCap Financial.
Midatech Pharma Chief Executive Craig Cook said: "The divestment of Midatech's US commercial arm will allow us to streamline and reshape the business from a specialty pharma to a pure play biotech company, and focus all our energy, attention and resources on advancing our innovative, higher value R&D oncology pipeline."
For 2017, Midatech Pharma US contributed GBP6.7 million in net statutory revenue and GBP3.9 million towards the group's pretax loss.
The sale is subject to shareholder approval at a general meeting.
Shares in Midatech Pharma were down 9.1% at 25.00 pence on Thursday.