Drug developer Pharmaxis turns loss into $6m profit
Health & Biotech
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Aussie pharma Pharmaxis has turned an $18 million loss into a $6 million profit.
Pharmaxis is a drug developer focused on diseases such a kidney and liver fibrosis and cancer.
Pharmaxis (ASX:PXS) — which has two approved products sold in Australia, Asia, Europe and Russia — put the turnaround down to milestone payments from German pharma giant Boehringer Ingelheim and increased sales of its approved drugs.
“The new drug development and the traditional approved products are the main driver of profitability,” CFO David McGarvey told Stockhead. “It’s good the numbers reflecting what’s happening in the business.”
Pharmaxis shares were up 2 per cent to 32.5c in early Friday trade.
In 2015, Boehringer Ingelheim bought Pharmaxis’ investigational anti-inflammatory drug PXS-4728A to develop it in clinical trials for the treatment of fatty liver disease and other inflammatory disease.
And during the past financial year, two separate Phase 2 trials run by Boehringer Ingelheim administered their first dose, triggering milestone payments to Pharmaxis totalling $42 million.
(Clinical trials are generally divided into three phases. Phase 1 focuses on safety, Phase 2 tests for effectiveness and Phase 3 examines whether the new drug is an improvement on existing treatment.)
Pharmaxis’s two approved drugs are Bronchitol, an inhaled dry powder to treat cystic fibrosis, and Aridol, a lung function test for asthma.
Bronchitol is sold in Australia, Europe and Russia and Aridol is sold in Australia, Europe and Asia. The company announced earlier this week that Aridol will be sold in the United States by the end of the year.
In the 2018 financial year sales of the two products grew 27 per cent to $6.1 million.
Pharmaxis also reported clinical trial cost reimbursement of $1.2 million, $600,000 in interest, $471,000 from sub-leasing their office and warehouse space and an R&D tax incentive of $161,000.
The company has been approached for comment.