Intl. Biotechnology Trust PLC
02 October 2006
For release 2 October 2006
INTERNATIONAL BIOTECHNOLOGY TRUST PLC
The Board of International Biotechnology Trust Plc ('IBT') today announces its
unaudited Annual Results for the twelve months ended 31 August 2006.
Summary
• Net asset value per share rose by 17.3% to 142.25p
• Both the NASDAQ Biotech Index and the Merrill Lynch Small Cap Biotech
Index fell by 7.6% and 23.0% respectively (both sterling adjusted)
• Share price up 24.7% from 104.3p to 130.0p
• Both the quoted and unquoted portfolios outperformed the NASDAQ Biotech
and Merrill Lynch Small Cap Biotech Indices (sterling adjusted)
• NAV increased for the fourth consecutive year
• Performance driven by M&A activity: the acquisition of KuDOS by
AstraZeneca at the end of December 2005, the acquisition of GlycoFi by Merck
in early May 2006, the acquisition of Cambridge Antibody Tecnology by
AstraZeneca announced mid-May and the merger of Micromet from the unquoted
portfolio with CancerVax from the quoted portfolio in January 2006.
• At 31 August 2006, 9.5% of net assets were invested in unquoted
companies
• Unquoted investment in GlycoFi realised at a profit nine times the
initial investment in the same year as the investment
• Cenkos Securities appointed as the Company's stockbroker
• Two IPOs in the unquoted portfolio: Genosis and Sunesis
• At year end investments held in 49 companies; 36 quoted and 13 unquoted
with 60.1% of NAV invested in North America, 23.7% in Europe (including the
UK) and 2.8% in Australia
• Total net assets at 31 August 2006: £66.95m (31 August 2005: £58.0m
(restated))
For further information, please contact:
International Biotechnology Trust plc
Andrew Barker, Chairman 020 7658 3206
SV Life Sciences Managers LLP
Kate Bingham / Andy Smith 020 7421 7070
Lansons Communications
Amy Fisher / Charlotte Edgar 020 7490 8828
Cenkos Securities
Will Rogers 020 7397 8900
Website: www.internationalbiotrust.com
CHAIRMAN'S STATEMENT
Performance and review
I am pleased to report some good results and an increase in the net asset value
(NAV) of International Biotechnology Trust (IBT) for the fourth consecutive
year. Over the year to 31 August 2006, NAV increased by 17.3% to 142.25p per
share. Over the same period the NASDAQ Biotech Index (NBI) and the Merrill Lynch
Small-Cap Biotech Index (MLSCBI) fell by 7.6% and 23.0%, respectively, both in
sterling terms.
Even more pleasing to shareholders will be the increase in the share price,
which not only benefited from the improvement in the NAV but also from the
decline in the discount at which the shares sell in relation to the underlying
net asset value. The share price rose by 24.7% from 104.3p to 130.0p. The Board
believes that the improvement in the rating of the Company's shares - the
discount was 8.6% at the year end - is in part a recognition of the excellent
job that SV Life Sciences has done in turning around and managing the portfolio
in the last five years. It is also in part a recognition in the market place
that, because of the riskiness of owning the shares of any individual biotech
company, a portfolio approach to investing in the sector is a prudent and
sensible way to gain exposure to a sector with very exciting long-term
prospects.
As we have a material percentage of our assets invested in unquoted companies,
our results may not closely correlate with the fluctuations in stock markets
which we consider an advantage, but our results will be influenced by them. Most
of the increase in the NAV occurred in the first half of our year and in the
second half there was a sell-off in stock markets. While there have been two
initial public offerings (IPOs) from the unquoted portfolio, these have not been
the key drivers of performance, rather it has been the merger and acquisition (M
&A) activity in private and public biotechnology.
The most significant drivers for NAV performance in the year under review have
been the acquisitions of KuDOS by AstraZeneca announced at the end of December
2005 (which contributed 3.7p per share to the improvement in the NAV), the
acquisition of GlycoFi by Merck announced in early May 2006 (15.0p per share),
the acquisition of Cambridge Antibody Technology (CAT) by AstraZeneca announced
mid-May 2006 (5.0p per share) and the merger of Micromet from the unquoted
portfolio with CancerVax from the quoted portfolio which was announced in
January 2005 (-9.5p per share). All these transactions have since been
completed, although an escrow remains in the portfolio with respect to KuDOS.
While the Micromet initially provided a significant uplift to NAV on the
completion of the merger, the smallest capitalisation U.S. biotechnology
companies had sold off to such an extent by our year end that Micromet ended the
year below historical cost and the start of year carrying value. Further
information about investment performance appears in the Managers' Review and in
the Business Review in the Annual Report.
The performance of IBT's quoted portfolio, calculated on a time-weighted return
basis, (assuming mid-month cash flows) showed an increase of 3.7%. On an
unweighted basis, (ignoring the timing of transactions) the return was 0.77%.
At 31 August 2006, the level of cash, money market instruments and other net
assets was 13.3% of net assets and unquoted and quoted were 9.5% and 77.2%
respectively. At the year end, the discount of the share price to NAV per share
was 8.6%.
Exchange rates are difficult to forecast with any degree of accuracy. Whilst the
Board keeps the situation under review, its current policy remains not to hedge
the currency exposure of the portfolio.
Longer-Term Results (2003/06): NAV +26.3%;
NASDAQ Biotech Index (£) -15.0%
It is now five years since SV Life Sciences took on the investment management of
your Company. It was a difficult start for our Manager because it coincided with
a collapse in the biotechnology sector - the NASDAQ Biotech Index fell 44.3% in
the 12 months to 31 August 2001 and because there were many problem investments
which required significant restructuring. Much of the first two years involved
dealing with those investments and it is only in the last two years or so that
SV Life Sciences has been able to stamp its own authority on the portfolio. Your
Board of Directors is much encouraged by the progress of the Company during the
past three years. As I continually emphasised, investing in biotechnology shares
as well as those of your Company can prove quite volatile but we would hope the
return from our shares will prove very worthwhile over the longer-term. During
the last three years the NAV has risen 26.3% compared with a fall of 15.0% in
the Sterling adjusted value of the NASDAQ Biotech Index. It gives us confidence
that good stock picking can pay and that SV Life Sciences has some skill in this
respect.
Accounting Standards
This year's report and accounts have been prepared having adopted IFRS as was
required of the Company from this financial year onwards. Details on the impact
of the move to IFRS are set out in the notes to these accounts. This Annual
Report also contains a Business Review, which became mandatory under the
European Union's Accounts Modernisation Directive for all UK listed companies
for financial years beginning on or after 1 April 2005.
Valuation Policy
In the year to 31 August 2006, the Directors' valuations of unquoted companies
in the portfolio amounted to £6.4m which is 9.5% of net assets. The Board has
reviewed the guideline that up to 40% of net assets may be invested in unquoted
companies and continues to believe that this is appropriate. Significant changes
to the unquoted portfolio have occurred in the year under review, including one
investment, GlycoFi, which was made in September 2005 and realised in July 2006
at a profit of nine times the initial investment. While Board believes that the
guideline on unquoted exposure is appropriate, the level of unquoted exposure of
IBT will vary depending on the point in the market cycle, deal-flow, valuations
relative to the quoted market and realisations.
Share Buy-Backs and Treasury shares
During the year ended 31 August 2006, the Company purchased 750,000 of its own
shares for cancellation under the authority granted to it at the Annual General
Meeting held on 11 November 2005. At the Extraordinary General Meeting held in
June 2006, in addition authority was obtained for the Company to purchase its
own shares to be held in Treasury for potential subsequent re-issue. The Board
continues to monitor the discount to net asset value at which the Company's
shares trade and purchases will be made when shares are available in reasonable
volumes and at a discount to net assets. Directors are seeking renewal of these
authorities at the forthcoming Annual General Meeting.
Changes to the Investment Management Agreement
During the year, some changes were made to the Investment Management Agreement
with SV Life Sciences, taking effect from 1 September 2006, which include
changes to the incentive fee arrangements for our Manager in the future. The new
incentive fee arrangements are detailed in the Directors' Report in the Annual
Report.
Annual General Meeting
The Annual General Meeting will be held at 12:00 noon on Friday, 10 November
2006 at 31 Gresham Street, London EC2V 7QA. As in previous years, the meeting
will include a presentation by SV Life Sciences.
Prospects
Stock market sentiment towards the biotechnology sector appears to be improving
in part, because during the past year there has been a considerable increase in
M&A activity. We believe that these trends will continue. Investing in the
biotechnology sector may provide high returns but it also carries high risk. We
consider that the safest returns for investors will be achieved through a
diversified active portfolio of public and private investments which IBT
uniquely provides and we have every confidence that our Manager will take
advantage of the investment opportunities.
Andrew Barker
Chairman
2 October 2006
Investment Managers Review
Market Review
Stock markets have experienced another volatile year from August 31 2005 where,
after an initial period of weakness lasting until early November 2005, they rose
steadily until late February 2006. At the end of February, U.S. biotechnology
(using the NASDAQ and Amex biotech indices as proxies) was the first to fall
relative to their larger capitalisation and technology counterparts. This
retreat subsequently affected most equity classes and lasted until our year end.
While the S&P500 fared better than U.S. technology and biotechnology indices
(finishing broadly flat over the period), U.K. technology and biotechnology
indices finished ahead of than their U.S., counterparts although behind the
FT100 index.
Against this backdrop of a weak biotechnology sector, the IBT portfolio has
produced positive results for the year that have been uncorrelated with, for
example, the negative performance of the NASDAQ biotech index. The exposure to
selected European, Australian, European and Canadian biotechnology investments
have provided some buffer to the weak U.S. biotechnology sector, but the key
driver for portfolio performance over the year, and of increasing relevance for
the sector in general, has been M&A activity.
The acquisition of small and mid-capitalisation biotechnology companies by
pharmaceutical companies has often been an underlying theme for the sector, and,
as sales growth at the largest biotechnology companies starts to slow, there may
be more competition for this finite number of assets. The impetus for this trend
is referred to the innovation gap in a recent Ernst & Young report where, over
the period 1998 to 2005, pharmaceutical companies spent about four times as much
as biotechnology companies on R&D. In 2005, however, pharmaceutical companies
only received about two thirds of the new chemical entity approvals of
biotechnology companies. This is an important validation for the investment
trust-type vehicle which includes unquoted exposure and in addition to the
acquisition of portfolio companies detailed in Portfolio Highlights below, the
U.S. Industry source VentureOne has tracked the private healthcare acquisitions
from 1996 when the number of deals was 50 to 2005 when the number was 73.
Many market participants have speculated as to why the U.S. biotechnology sector
fell out of favour with investors first and so quickly. The macroeconomic
conditions resulting in higher interest rates and commodity prices cannot have
helped biotechnology companies and these factors affected most equities, but
there were also sector-specific issues at work.
Drug safety issues have been an important dynamic at the U.S. Food & Drug
Administration (FDA) with most concerns being with drugs that are under
investigation in general practice, for chronic, non-life threatening
indications. In mid-May 2006, Neurocrine Biosciences and partner Pfizer did not,
as was widely expected, receive an approval letter for either form of their drug
to aid sleep, Indiplon. When it became apparent that further clinical trials
would be required, Pfizer returned the rights to Neurocrine. Encysive
Pharmaceuticals was denied approval in March 2006 and again at the end of July
for its endothelin receptor antagonist, Thelin, to treat pulmonary hypertension.
At the start of our year, Encysive Pharmaceuticals was our fifth largest holding
but was completely divested prior to these negative events.
The regulatory agencies were not the only ones to reveal bad news on drug safety
during the year, since a number of companies either stopped development, or had
to reduce the dose in the middle of clinical trials of their compounds. In March
2006, Idenix Pharmaceuticals reported serious gastroenterological reactions to
its drug valopicitabine to treat hepatitis C infection. 2006 continued to be a
bad year for anti-viral development when in early April, former genomics
company, Incyte, discontinued the development of its HIV anti-viral due to liver
toxicity and recent Initial Public Offering (IPO) Anadys suspended its phase Ib
clinical study of ANA975 for the treatment of hepatitis C infection due to
pre-clinical toxicology issues. Another recent IPO, Threshold Pharmaceuticals,
announced in May 2006 that its lead drug for benign prostate hyperplasia had
liver toxicity and was initially placed on clinical hold before being
terminated. Fortunately, none of these two companies have ever been IBT
portfolio investments. However the portfolio did experience a regulatory
disappointment in the year when Pozen and partner GSK were issued an approvable
letter for their migraine treatment, Trexima. The Pozen share price recovered
after the two companies outlined their plan to address the FDAs safety concerns,
and then Pozen announced a separate collaboration with AstraZeneca. In
consequence, the IBT holding in Pozen finished the year at a higher valuation
than where it started and comfortably above cost.
While the clinical and regulatory failures in the sector have drastically
affected the individual share prices of the companies involved, their large
number and high profile in the year under review resulted in investors
withdrawing from the sector and resulted in a broad negative effect on the
sector indices. Other companies where significant negative clinical or
regulatory events occurred during the year to 31 August 2006 include Inhibitex,
NPS Pharmaceuticals, Discovery Laboratories, Nastech Pharmaceuticals, Vasogen,
and Valentis. None of these companies has been IBT portfolio investments.
A further significant theme that has appeared in biotechnology over the year has
been the increase in competition at biotechnology companies, or fast followers
that include (in Europe, at least) biosimilars or generic biologics. Since the
late 1970s the first biotechnology companies have defined the highly profitable
biotechnology sector by the development and commercialisation of complex
molecules. In the last year we have seen the first generic version of
recombinant human growth hormone approved in Europe and the appearance of
competitors to molecules either approved, or approaching approval. Examples of
these molecules under threat include OSI's Macugen, Genentech's Herceptin and
Amgen's Epogen. For an investment portfolio such as IBT, this growing trend
tilts our investment universe away from the largest capitalisation profitable
companies to the small and mid-capitalisation space where it has historically
been directed.
Portfolio Summary
At the year end, IBT held investments in 49 companies; 36 quoted companies
(representing 77.1% of NAV), and 13 unquoted companies (representing 9.5% of NAV
). The remaining 13.4% was made up of cash and money market instruments (£6.0
million), with 7.3% of the NAV being committed to further unquoted investments.
Prior to the year end, IBT's cash position was enhanced by the significant
realisations of CAT, GlycoFi and AnorMED, which are in the process of being
reinvested.
Members of SV Life Sciences sat on the Boards of twelve portfolio companies at
the end of the year under review; Achillion, Affibody, Archemix, Dynogen,
ESBATech GTx, Intranasal Therapeutics, Lux, Micromet, Oxagen, PowderMed and
Trine. The geographical split of the portfolio at 31 August 2006 was 60.2% in
North America, 11.3% in the U.K., 12.4% in Continental Europe and 2.8% in
Australia. By sub-sector, 78.6% of NAV was invested in biopharmaceuticals, 5.2%
in drug delivery, 1.3% in medical devices and 1.6% in other areas. The remaining
13.3% of NAV comprised of cash, money market instruments and other net assets.
The companies which SV Life Sciences estimate as having close to one year of
cash at 31 August 2006 were Affibody, Acambis, AnorMED and GTx. Within this
group, Affibody is an unquoted company which is expected to receive a funding
tranche within the next year. Since the year end, AnorMED has been the subject
of competing tender offers by Genzyme and Millennium, and GTx has licensed
European rights to its lead drug Acapodene for an up-front payment of $30
million plus royalties and milestones. Acambis has received $19m from Novartis
and $30m from the U.S. government.
IBT continues to offer investors a broad exposure to biotechnology at different
stages of clinical development and allocated across a range of therapeutic
areas. We believe that as a publicly quoted Investment vehicle comprising
actively managed globally diversified public and private biotechnology, IBT
continues to offer investors a unique investment proposition.
Unquoted Investment Activity
At 31 August 2006, IBT's unquoted portfolio (value £6.4 million) represented
9.5% of net assets down from 28.6% the previous year. This significant change
only hints at the developments that have occurred in the unquoted portfolio over
the last year. The divestments of Aderis, KuDOS and GlycoFi occurred during the
year, the former two remaining in the portfolio as smaller escrow holdings. The
investment in GlycoFi was a notable one for IBT being made in September 2005 and
being realised at a nine times multiple in June 2006. There have been two exits
from the portfolio during the year by IPO; Genosis and Sunesis, both of which
finished the year significantly below their IPO price as the share prices of the
smallest companies suffered most in the weak stock market since the end of
February 2006.
In early January 2006, Micromet and CancerVax announced their proposed merger
which allowed the German unquoted Micromet to merge into the NASDAQ-quoted cash
shell, CancerVax. The combined company has been re-named Micromet and at the end
of the year in review, remained IBT's third largest holding. This high level of
exits from the unquoted portfolio, including two trade sales, has left the
unquoted exposure lower at the end of the year than at the start. As new
investments drawdown their committed capital and new investments are made, this
level of unquoted exposure is expected to increase.
Follow-on investments in unquoted companies PowderMed, Affibody, Trine and
Oxagen were made in the year to 31 August 2006 totalling £0.69 million. The
earlier investments in two of these companies (Affibody and Trine), were written
down within the year to reflect the uncertain funding environment. New unquoted
investments were made in Intranasal Therapeutics, Achillion, Lux and ESBAtech
representing first tranches totalling £1.11 million. During the year under
review, the net change in the Directors' valuations of the unquoted investments
was £7.92 million, representing 13.7% of NAV at the start of the reporting year.
Quoted Investment Activity
During the general period of share price weakness prior to December 2005, we
took the opportunity to increase our holdings in two portfolio companies on
valuation grounds. At the times of our investment, CAT was trading at its
52-week lows and AnorMED was trading below the share price of a recent
fundraising in which we did not participate. Both of these holdings were the
targets in the acquisitions by AstraZeneca and Genzyme (and subsequently
Millennium), respectively, and were divested and partially divested,
respectively, at significant uplifts to the start of year valuations.
Further investments were made in existing holdings during the year including
CSL, Gilead and Shire where we expected positive regulatory events. In early
June the FDA approved the first vaccine against human papillomavirus (which
causes cervical cancer) Gardasil, which will be marketed by Merck. CSL entered
into a licensing agreement with Merck in 1995 relating to the technology used in
Gardasil and receives milestones and royalties on sales. Gardasil was
subsequently recommended for routine vaccination in girls and women 11 to 26
years of age by the U.S. Centers for Disease Control and Prevention's Advisory
Committee on Immunisation Practices. In mid-July the FDA approved Gilead
Sciences' once a day triple anti-viral therapy for HIV developed in combination
with Bristol-Myers Squibb. The combination therapy, Atripla, has rapidly gained
market share and could become the mainstay of first-line anti-HIV therapy due to
its convenient once daily dosing regime.
After completing the acquisition of Transkaryotic Therapies, Inc., Shire went on
to see the expansion of its attention deficit hyperactivity disorder (ADHD)
franchise with the approval of the Daytrana patch (developed with portfolio
company Noven), and the approval of Elaprase, an enzyme replacement therapy for
Hunter Syndrome. Just prior to our year end Shire and Barr Laboratories reached
agreement on Barr's patents covering Shire's lead product for ADHD, Adderall XR.
At the start of our year, Encysive Pharmaceuticals was IBT's fifth largest
investment having been partially divested a few months before. The holding in
Encysive was fully divested and re-invested into Encysive's competitors Myogen
and Actelion prior to the failure of Encysive to gain FDA approval for Thelin.
Subsequently during the year, the holdings in both new investments were
increased and at 31 August 2006, Actelion was IBT's sixth largest holding.
Portfolio Highlights
In late December 2005, AstraZeneca announced the acquisition of the U.K. private
portfolio company KuDOS and in early April 2006, Merck announced the acquisition
of the US private portfolio company GlycoFi. M&A activity in the sector has not
been confined to private companies as in mid-May 2006, AstraZeneca announced the
acquisition of one of our long-term portfolio company, Cambridge Antibody
Technology, while just prior to our year-end in August 2006, Genzyme announced a
proposed acquisition and tender offer for Canadian portfolio company AnorMED.
Both these holdings have resulted in significant uplifts from their 31 August
2005 valuations.
A number of portfolio companies have received FDA approvals within the year to
31 August 2006. Celgene received two approvals for its leukaemia drug Revlimid
during the year in myelodysplastic syndrome and multiple myeloma. Also in
haematological disorders, MGI Pharma received FDA approval for Dacogen in
multiple myeloma. Long-standing holding Nektar Therapeutics and partner Pfizer
received FDA approval for the first inhaled insulin formulation and the
commercial launch is already underway. Other quoted portfolio companies
receiving FDA approvals during the year were Noven, Shire, and Gilead Sciences.
FDA or European drug approvals may be the first step to commercialisation and
can currently result in share price volatility as event-driven investors
turnover in favour of those with a longer-term perspective. Typically IBT will
hold investments where the commercial potential is significant through this
period, often increasing the holding during the volatility. An example of this
during the year was the drug delivery company Noven whose Daytrana patch
formulation developed in collaboration with Shire was approved by the FDA in
early April 2006 but the Noven share price reached 52-week highs at the end of
August 2006 when it started to appear that the Daytrana launch was going well.
Outlook
Whilst the year to August 31 2006 has been very productive for IBT, the focus
now is on seeding the portfolio with new unquoted investments and managing the
public holdings up to and through the binary events like clinical trial results
and regulatory approvals in the years ahead. Certain binary events at portfolio
companies are unpredictable such as the signing of licensing deals and
acquisition activity. These events can happen at any time and are uncorrelated
with the trends in broad stock markets. IBT will continue to seek out the
investments that are likely to benefit from these binary events where they are
assessed to have a good likelihood of success. The weakness in the U.S. stock
markets during the year in review has affected NAV but uncorrelated positive
events at portfolio companies and the geographic diversity of the portfolio have
been buffers to wider negative sentiment. With an expanding universe of
potential portfolio companies there is no shortage of investment ideas moving
forward, although many of these may not come to fruition in the next 12 to 18
months so a long-term investor perspective is recommended.
SV Life Sciences
2 October 2006
Ten Largest Quoted Investments at 31 August 2006
________________________________________________________________________________
Market % of
value Net
Investment £'000 asset Country Business activity
________________________________________________________________________________
1 AnorMed 3,009 4.5 Canada AnorMED discovers and
develops small molecule
therapeutics for the
treatment of HIV infection
and cancer. The company has
one product in Phase III
and one in phase II.
________________________________________________________________________________
2 Progenics 2,665 4.0 USA Progenics is a
Pharmaceuticals biopharmaceutical company
focusing products for the
treatment and prevention of
cancer and viral diseases.
The company's lead drug,
methylnaltrexone has
successfully completed
phase III studies and is
partnered with Wyeth.
________________________________________________________________________________
3 Micromet 2,607 3.9 USA Micromet designs and
develops nobel antibody
derived therapies for the
treatment of severe human
diseases. Micromet has two
clinical candidates and
partnership with Serono,
Enzon and Medlmmune.
________________________________________________________________________________
4 Noven 2,300 3.4 USA Noven Pharmaceuticals is a
Pharmaceuticals leading developer of
advanced transdermal drug
delivery technologies and
prescription transdermal
products.
________________________________________________________________________________
5 Shire 2,043 3.1 UK Shire is a global specialty
pharmaceutical company with
a focus on four therapeutic
areas: central nervous
system disorders, oncology/
hematology, anti-virals and
biologics.
________________________________________________________________________________
6 Actelion 1,936 2.9 Switzerland Actelion is an independent
biopharmaceutical company
discovering, developing,
and marketing drugs for
high unmet cardiovascular
diseases.
________________________________________________________________________________
7 MorphoSys 1,905 2.8 Germany MorphoSys AG develops the
next generation of
therapeutic antibodies, but
also antibodies for
research and diagnostic
purposes.
________________________________________________________________________________
8 Nuvelo 1,894 2.8 USA Nuvelo Inc is focused on
the discovery, development
and commercialisation of
cardiovascular therapeutics.
________________________________________________________________________________
9 Jerini 1,871 2.8 Germany Jerini AG is a
pharmaceutical company
based in Berlin, Germany
focusing on the discovery
and development of
peptide-based drugs.
________________________________________________________________________________
10 Barr 1,864 2.8 USA Barr Pharmaceuticals is a
Pharmaceuticals speciality pharmaceutical
company that develops,
manufactures and markets
both generic and
proprietary prescription
pharmaceuticals.
________________________________________________________________________________
Total 22,094 33.0
________________________________________________________________________________
Unquoted Investments at 31 August 2006
Market % of
value Net
Investment £'000 asset Country Business activity
________________________________________________________________________________________
1 Oxagen 1,559 2.3 UK Oxagen is developing a pipeline
of novel drugs to treat
inflammatory diseases. The
company's portfolio includes a
lead programme with the
potential to treat asthma and
other respiratory and
inflammatory conditions.
________________________________________________________________________________________
2 Dynogen 1,025 1.5 USA Dynogen is a biopharmaceutical
Pharmaceuticals company developing drugs for
genitourinary and
gastrointestinal disorders
including constipation,
irritable bowel syndrome and
overactive bladder.
________________________________________________________________________________________
3 Archemix 888 1.3 USA Archimex is a leading
biopharmaceutical company in
the development of aptamers as
therapeutic agents. Aptamers
are single stranded nucleic
acids that form well defined
3-D shapes binding target
molecules in a similar manner
to antibodies.
________________________________________________________________________________________
4 Affibody 580 0.9 Sweden Affibody uses innovative
protein engineering
technologies for the
development of products for
biotherapeutics and
biotechnology applications.
Affibody molecules mimic
monoclonal antibodies and are
derived from an
antibody-binding domain of
Protein A.
________________________________________________________________________________________
5 Achillon 526 0.8 USA Achillon's discovery and
development teams have advanced
multiple product candidates
with novel mechanisms of
action. Achillion is focused on
solutions for the most
challenging problems in
infectious disease - HIV,
hepatitis and resistant
bacterial infections.
________________________________________________________________________________________
6 PowerMed 503 0.8 UK PowerMed is an
immunotherapeutic product
company with six vaccine
programmes targeting influenza,
chronic viral diseases and
cancer. PowerMed's products are
based on their proprietary DNA
particle mediated delivery
technology.
________________________________________________________________________________________
7 Intranasal 276 0.4 USA Intranasal Therapeutics Inc is
a speciality pharmaceutical
company focused on developing
innovative nasally delivered
pharmaceutical products, with a
particular focus on drugs
treating pain and disorders
related to the central nervous
system for which there is
proven, unsatisfied consumer
need.
________________________________________________________________________________________
8 Spinal Kinetics 263 0.4 USA Spinal Kinetics is pioneering a
new generation of artificial
discs for treating Degenerative
Disc Disease in the cervical
and lumbar spine. The company's
unique technology is designed
to replicate a natural
vertebral disc in its structure
and physiologic range of motion
in all planes, including axial
compression and rotation. This
'natural' artificial disc has
been designed to enable
patients to move freely while
enjoying a sustained quality of
life.
________________________________________________________________________________________
9 KuDOS 222 0.3 UK KuDOS is developing small
molecule drugs based on DNA
damage sensing, signalling and
repair, initially focused on
oncology, has three products in
clinical development and three
preclinical candidates. KuDOS
has been acquired by
AstraZeneca.
________________________________________________________________________________________
10 ESBATechnology 166 0.2 Switzerland ESBATech is a drug discovery
and development company
focusing on therapeutic
applications of its proprietary
antibody fragments derived from
fully human antibody fragment
scaffolds.
________________________________________________________________________________________
11 Trine 138 0.2 USA Trine is a drug developmental
Pharmaceuticals company with products to
address the areas of renal,
gastrointestinal and metabolic
diseases.
________________________________________________________________________________________
12 Lux Biosciences 121 0.2 USA Lux is a biotechnology company
specialised in the field of
ophthalmic diseases developing
medications to treat the
underlying clauses of these
diseases and alleviate their
symptoms ultimately striving to
improve or preserve the
eyesight of patients with these
disease.
________________________________________________________________________________________
13 Aderis 120 0.2 USA Escrow holding after the sales
Pharmaceuticals of most of the assets to
Schwarz Pharma.
________________________________________________________________________________________
Total 6,387 9.5
________________________________________________________________________________________
Note on Merrill Lynch Small Cap Biotech Index (MLSCI)
The MLSCI represents stocks with market caps under US$1 billion. The movement in
the MLSCI from 31 August 2005 to 31 August 2006 in $ terms, based on the data
received from Merrill Lynch on 1 September 2005 is 14%.The movement in £ terms
has been calculated using the prevailing exchange rates at the start and end of
the reporting period, sourced from Factset and Bloomberg.
The data underlying the MLSCI changes regularly in line with changes in the
index constituents, price adjustments and corporate actions. The historic data
is then retrospectively adjusted. As a result the performance for the reporting
period, if calculated at a future date, is likely to be different from the
previously published number.
International Biotechnology Trust plc
Consolidated Income Statement
for the year ended 31 August
Restated
2006 2006 2006 2005 2005 2005
Group Group Group Group Group Group
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Gains on investments
held at fair value - 10,638 10,638 - 586 586
Exchange
(losses)/gains on
currency balances - (66) (66) - (224) (224)
Income 701 - 701 545 - 545
Management fees (855) - (855) (781) - (781)
-------------- -------- -------- -------- -------- -------- --------
Administrative
Expenses (567) - (567) (496) - (496)
-------------- -------- -------- -------- -------- -------- --------
Net (loss)/ profit
before taxation (721) 10,572 9,851 (732) 362 (370)
-------------- -------- -------- -------- -------- -------- --------
Tax on ordinary
activities - - - - - -
-------------- -------- -------- -------- -------- -------- --------
Net (loss)/profit
after taxation (721) 10,572 9,851 (732) 362 (370)
-------------- -------- -------- -------- -------- -------- --------
(Deficit)/return per
share (1.52)p 22.32p 20.80p (1.54)p 0.76p (0.78)p
-------------- -------- -------- -------- -------- -------- --------
The total column of this statement represents the Group's Income Statement
prepared in accordance with IFRS.
The revenue and capital return columns are supplementary to this and are
prepared under guidance published by the Association of Investment Companies.
The Group has no recognised gains or losses other than those disclosed in the
Consolidated Income Statement and the Consolidated Statement of Changes in
Equity.
All items in the above statement drive from continuing operations.
International Biotechnology Trust plc
Balance Sheets at 31 August
Restated
Group Company Group Company
2006 2006 2005 2005
£'000 £'000 £'000 £'000
Fixed assets
Investments held at fair value
through profit or loss 58,022 58,022 49,227 49,227
Current assets
Debtors 2,000 2,000 61 61
Investments 6,022 6,022 7,110 7,110
Cash at bank 1,074 1,074 2,336 2,336
----------------- ----------- ---------- --------- --------
9,096 9,096 9,507 9,507
Creditors
Amount falling due within one year (167) (678) (731) (1,242)
----------------- ----------- ---------- --------- --------
Net current assets 8,929 8,418 8,776 8,265
----------------- ----------- ---------- --------- --------
Net assets 66,951 66,440 58,003 57,492
----------------- ----------- ---------- --------- --------
Capital and reserves
Called up share capital 11,766 11,766 11,954 11,954
Capital redemption reserve 11,231 11,231 11,043 11,043
Share purchase reserve 65,564 65,564 66,467 66,467
Capital reserve (9,944) (10,455) (20,516) (21,027)
Revenue reserve (11,666) (11,666) (10,945) (10,945)
----------------- ----------- ---------- --------- --------
Equity shareholders' funds 66,951 66,440 58,003 57,492
----------------- ----------- ---------- --------- --------
Net asset value per share 142.25p 141.17p 121.30p 120.24p
These financial statements were approved by the Board of Directors on 2 October
2006 and signed on their behalf by
Andrew Barker (Chairman)
Peter Collacott (Director)
International Biotechnology Trust plc
Consolidated and Company Statement of Changes in Equity
for the year ended 31 August
Group
Year ended 31 August 2006
Capital Share Capital Capital
Share redemption purchase reserve reserve Revenue
capital reserve reserve realised unrealised reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 31
August 2005 -
restated 11,954 11,043 66,467 6737 (27253) (10,945) 58,003
Buy back of
ordinary
shares (188) 188 (903) - - - (903)
Net
(loss)/profit
for the year - - - (2,584) 13,156 (721) 9,851
--------------- ------- -------- ------- ------- -------- ------- -------
Balance at 31
August 2006 11,766 11,231 65,564 4,153 (14,097) (11,666) 66,951
--------------- ------- -------- ------- ------- -------- ------- -------
Group
Year ended 31 August 2005
Capital Share Capital Capital
Share redemption purchase reserve reserve Revenue
capital reserve reserve realised unrealised reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 31
August 2004 11,954 11,043 66,467 7,899 (31,996) (10,213) 55,154
Affect of
adoption of
IFRS - - - - 3,219 - 3,219
--------------- ------- -------- ------- ------- -------- ------- -------
Balance at 31
August 2004 -
restated 11,954 11,043 66,467 7,899 (28,777) (10,213) 58,373
Net
(loss)/profit
for the year - - - (1,162) 1,524 (732) (370)
--------------- ------- -------- ------- ------- -------- ------- -------
Balance at 31
August 2005 11,954 11,043 66,467 6,737 (27,253) (10,945) 58,003
--------------- ------- -------- ------- ------- -------- ------- -------
Company
Year ended 31 August 2006
Capital Share Capital Capital
Share redemption purchase reserve reserve Revenue
capital reserve reserve realised unrealised reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 31
August 2005 -
restated 11,954 11,043 66,467 6,226 (27,253) (10,945) 57,492
Buy back of
ordinary
shares (188) 188 (903) - - - (903)
Net
(loss)/profit
for the year - - - (2,584) 13,156 (721) 9,851
--------------- ------- -------- ------- ------- -------- ------- -------
Balance at 31
August 2006 11,766 11,231 65,564 3,642 (14,097) (11,666) 66,440
--------------- ------- -------- ------- ------- -------- ------- -------
Company
Year ended 31 August 2005
Capital Share Capital Capital
Share redemption purchase reserve reserve Revenue
capital reserve reserve realised unrealised reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 31
August 2004 11,954 11,043 66,467 7,899 (31,927) (10,213) 55,223
Affect of
adoption of
IFRS - - - - 3,219 - 3,219
--------------- ------- -------- ------- ------- -------- ------- -------
Balance at 31
August 2004 -
restated 11,954 11,043 66,467 7,899 (28,708) (10,213) 58,442
Net
(loss)/profit
for the year - - - (1,673) 1,455 (732) (950)
--------------- ------- -------- ------- ------- -------- ------- -------
Balance at 31
August 2005 11,954 11,043 66,467 6,226 (27,253) (10,945) 57,492
--------------- ------- -------- ------- ------- -------- ------- -------
International Biotechnology Trust plc
Consolidated Cash Flow Statement
for the year ended 31 August
Group Company Group Company
For the year For the year For the year For the year
ended ended ended ended
31 August 2005 31 August 2005 31 August 2005 31 August 2005
£'000 £'000 £'000 £'000
Cash flows from
operating activities
Net
profit/(loss)
before tax 9,851 9,851 (370) (950)
Adjustments for:
(Increase) in
investments (7,707) (7,707) (3,858) (4,889)
(Increase)/Decrease in
receivables (1,939) (1,939) 1,874 2,974
(Decrease)/Increase in
payables (564) (564) 353 864
------------------------ -------- -------- -------- --------
Net cash
outflow from
operating (359) (359) (2,001) (2,001)
activities
Cash flows from
financing activities
Purchase of
own shares for
cancellation (903) (903) _ _
------------------------ -------- -------- -------- --------
Net (Decrease)
in Cash and
Cash
Equivalents (1,262) (1,262) (2,001) (2,001)
Cash and Cash
equivalents at
1 September 2,336 2,336 4,337 4,337
------------------------ -------- -------- -------- --------
Cash and Cash
equivalents at
31 August 1,074 1,074 2,336 2,336
------------------------ -------- -------- -------- --------
Notes:
1. Audit status
These accounts consolidate the accounts of the Company 'International
Biotechnology Trust plc and its wholly-owned subsidiary, IBT 2004 Limited.
The financial information set out in the announcement does not constitute the
Company's statutory accounts for the year ended 31 August 2006 or 31 August
2005. The financial information for the year ended 31 August 2005 is derived
from the statutory accounts for that year which have been delivered to the
Registrar of Companies. The auditors reported on those accounts; their report
was unqualified and did not contain a statement under section 237(2) or (3) of
the Companies Act 1985. The statutory accounts for the year ended 31 August 2006
will be finalised on the basis of the financial information presented by the
Directors in this preliminary announcement and will be delivered to the
Registrar of Companies following the Company's Annual General Meeting.
This announcement is prepared on the basis of the accounting policies set out in
the annual financial statements.
2. As permitted by Section 230 (4) of the Companies Act 1985, the Company has
not presented its own revenue account. The net revenue deficit after taxation
for the year of the Company, dealt within the accounts of the Group was
£721,000.
3. Transactions in foreign currency, whether of a revenue or capital nature, are
translated into sterling at the rates of exchange ruling on the dates of such
transactions. Foreign currency assets and liabilities at the balance sheet date
are translated into sterling at the rates of exchange ruling on that date.
Exchange gains or losses on fixed asset investments are included within realised
or unrealised gains or losses on investments. Other exchange movements are shown
separately in the Group Income Statement.
4. The net asset value shown as at 31 August 2006 of 142.25p relates to group
assets of £66,951,000 and on 47,065,467 shares in issue.
5. Annual General Meeting
The Annual General Meeting of International Biotechnology Trust plc will be held
at 12 noon on 10 November 2006 at 31 Gresham Street, London, EC2V 7QA.
6. Annual Report and Accounts
The Annual Report and Accounts will be mailed to registered shareholders at
their registered addresses in October 2006 and from the date of release copies
of the Annual Report will be made available to the public at the Company's
registered office, 31 Gresham Street, London EC2V 7QA.
This information is provided by RNS
The company news service from the London Stock Exchange
