OptiBiotix Health plc (LON:OPTI) has seen significant commercial traction for its innovative new products to tackle obesity, heart disease and diabetes.
The latest trading statement revealed the company signed 18 deals in the 12 months ended last November, eight more than it did the year before. And 2019 has started with a flurry of new tie-ups around the globe.
As a result, revenues have grown to £541,000 in the year just gone, up from £191,000 in the comparable period. To provide a guide as to the direction of travel, 85% of 2018’s turnover was booked in the second half.
The new deals signed and expected, added to product sales from established tie-ups will continue to grow the top-line, with an additional push coming from online demand, OptiBiotix said.
At the year-end, the company had £1.33mln in cash, or £1.67mln once R&D tax credits and outstanding VAT are clawed back. At the same time, the company’s unit, Probiotix Health, raised just over £1mln via a convertible note in preparation for a potential stock market listing.
Sufficient cash
“With this funding and growing revenues, the cash position remains strong and sufficient to cover the delivery of existing commercial plans,” investors were told.
Strategically, OptiBiotix said it will continue to operate as an “asset-light” business. In practice, this means manufacturing, regulatory approvals and sales and marketing are funded by partners. It also means license and royalty fees effectively drop to the bottom line.
The company has developed products for cholesterol, weight loss and diabetes that target the human microbiome – the complex system of bacteria that exists in the gut that is also thought to have an impact on health.
The focus for 2019 is to further extend the firm’s reach into “new application areas and new territories”, the latest update said.
Transition
“The last 12 months have seen OptiBiotix transition from a research and development company to a commercial business with significant deal flow and rapidly growing revenues,” said chief executive Stephen O’Hara.
“This is all part of a strategy designed to develop multiple opportunities accessing healthcare markets around the world, which if successful, has the potential to generate substantive revenues and profitability.
“As these revenues grow and we continue to build trading histories with an increasing number of partners, we will be in a position to provide reliable forecasts to the market."