BioWorld International Correspondent

LONDON - Microscience Ltd. is looking to raise £40 million (US$71.6 million) in an initial public offering on London's Alternative Investment Market to finance development of five vaccines in clinical trials. The company is expected to have market capitalization of £120 million to £140 million.

"We feel that the offering we have got is very strong," Rod Richards, CEO, told BioWorld International. "Microscience has always been one of the companies with a good broad pipeline, and we have had significant clinical results in recent months."

Of the £40 million, £10 million would come from Microscience backers Apax Partners, Merlin Biosciences, Advent Venture Partners and JP Morgan Partners, all of which intend to make a further investment.

"The fact the venture capital backers are investing demonstrates there is significant value going forward, so they are keen to increase their stake," Richards said.

The money will enable Microscience to take its two lead oral vaccines, for typhoid and travelers' diarrhea, through to Phase III; an oral hepatitis B therapeutic vaccine to proof of efficacy; and injectable vaccines for meningitis B and neonatal Group B streptococcus to proof of concept. It then would look for partners.

"We have not given away any of the upside yet, and this funding will take us to significant goals in terms of clinical development," Richards said. Microscience could move into profitability with the funding, and depending on how well it does in partnering its five clinical stage vaccines, will invest, more or less, on bringing other products into the pipeline.

The company is working on plans for the Phase III trial of its typhoid vaccine, which is based on its spi-VEC oral delivery platform. To date, the freeze-dried vaccine has completed three studies in 100 healthy volunteers. In the latest, it was shown to be highly immunogenic at a single dose, with a good safety profile. Spi-VEC uses an attenuated Salmonella bacteria that is engineered to express a vaccine antigen. The gene encoding the antigen is inserted where one of the bacteria's virulence genes has been removed, ensuring stable incorporation.

Spi-VEC builds on another technology platform, Signature Tagged Mutagenesis, which enables the detection of virulence genes in microbes.

Richards said that armed with clinical evidence of the efficacy of the spi-VEC delivery system, Microscience now will be looking for licensing partners to develop vaccines in areas outside its focus on infectious diseases.

"Spi-VEC is a broad immune delivery system that could be used to deliver cancer antigens, and possibly also to prevent allergies," Richards said. "We would also look for collaborations in infectious diseases."

Microscience's preclinical programs include an oral vaccine against anthrax, which is being developed in collaboration with the U.S. Navy.

Microscience was spun out of Imperial College London in 1997 and has raised £40 million to date.