Business Weekly - Cambridge, UK

Astex Therapeutics in Cambridge has been provided with £7.5 million by international finance houses, Oxford Finance Corporation and GE Healthcare Financial Services, in what was described by the trio as one of the largest venture loans provided to a biotechnology company in Europe.
Astex mooted plans for a float last year but has had to reconsider plans in light of tough market conditions for biotechs.

Astex chief financial officer, John Aston, would not reveal the strategy behind the senior secured loan though he did say it held the advantages of being a faster method of raising cash without having to give up large numbers of shares.

“The financing provided to us by Oxford and GE Healthcare Financial Services is an attractive and innovative supplement to the more traditional private equity route, which gives us additional flexibility to execute our strategy for the future,” said Aston.

Astex raised £12.5 million at the end of April this year, taking the company’s total fundraising past £63m since its incorporation in 1999.
This was £7.5m short of the minimum amount CEO, Leon Bushara, had told Business Weekly in 2006 that the company was looking to raise.
At the time Bushara aimed for £20-25m, which on top of the company’s existing cash strength, allied to some impressive revenue-earning capacity and strong investor backing, meant it had no need to dive into an IPO before proving the efficacy of its lead products in patients, the first of which are expected mid-2008.

Astex uses a patented fragment-based drug discovery platform, Pyramid, to identify and develop new medicines, primarily for the treatment of cancer. As well as an established clinical stage pipeline, it has significant partnerships with leading pharmaceuticals including a deal with Novartis worth a potential $520m and a $270m collaboration with AstraZeneca.

“Oxford is proud to work with GE to provide financial support to Astex Therapeutics’ significant drug development initiatives,” said J Alden Philbrick, president and CEO at Oxford Finance Corporation, a subsidiary of Sumitomo Corporation, which has generated over $600m in loans in almost 20 years.
“We are especially pleased to participate in a precedent-setting transaction with one of the leading companies in the UK’s growing biotech industry,” he added.

GE Healthcare Financial Services has over €12bn of capital committed to the healthcare industry worldwide. Marcus O’Neill, vice president of its life sciences division in Europe said the landmark deal played an important step in its goal to increase the firm’s commitment to European biotech companies.