US speciality drugs group Avion Pharmaceuticals will fund the US$25mln in costs of a reformatted phase III clinical trial next year following the agreement of a trial design with the US Food & Drug Administration.
The UK group will receive up to US$70mln of milestone payments, with US$5mln due on regulatory approval of the product and a further US$65mln dependent on sales targets.
The Avion deal has effectively vindicated management’s faith in the drug, which missed its primary endpoint in a phase III study last year.
It has also proved a profitable choice for investors who decided to stick with the group despite its ups and downs, as the stock rocketed 278% this week to 28.4p, almost trebling its market value.
The AIM All-Share was up 1.8% in the week at 923.1, while the FTSE 100 was 1.2% higher at 7,414.
There was more good news from the biotech sector this week as Faron Pharmaceuticals Oy (LON:FARN) surged 34% to 238p after regulators gave the company the green light to expand a phase I/II clinical trial of its cancer immunotherapy to the US.
American patients will now be recruited to Faron’s MATINS study, which will assess the tolerability, safety and potential efficacy of the new treatment in people with certain types of cancer tumours.
Video editing tech group Blackbird PLC (LON:BIRD) flew 20% higher to 15p as it secured a multi-year deal with Bloomberg Media that it expects will generate significant revenues, albeit after knocking out around a £5.5mln placing on Friday following the previous session's surge.
Venture capital group TMT Investments PLC (LON:TMT) rose 17% to 4.1p after it highlighted that one of its core portfolio firms, ride-hailing app Bolt, could be a big beneficiary of Uber losing its licence to operate in London.
Elsewhere, power plant developer Rurelec Plc (LON:RUR) surged 20% to 0.7p after it received $640,000 as partial repayment of a loan to Patagonia Energy, although the company cautioned that it was not certain when the rest of the loan will be repaid.
Encouraging drilling results sent shares in Thor Mining PLC (LON:THR) 11% higher to 0.25p as the group unearthed what it said was significant copper mineralisation at its Kapunda project in Australia.
Among the fallers, industrial valve maker Pressure Technologies PLC (LON:PRES) was found guilty under section 2 of the Health and Safety at Work Act 1974 following the death at work of one of its maintenance engineers. The fatal accident took place at its Chesterfield Special Cylinders unit in 2015.
The company now faces a sentencing hearing next month which will determine the level of penalty it will receive. However, investors decided to exit early as the stock sank 6% to 96p.
A profit warning sent shares in financial services group STM Group Plc (LON:STM) plunging 38% to 27p as it said problems at its recently-acquired Carey Group business will delay new business and increase one-off professional costs.
Similarly, educational course provider Malvern International PLC (LON:MLVN) plunged 48% to 0.8p in the week after growth in its second half fell short of expectations, and as a result revenues for the full-year were now only expected to be modestly ahead of the prior 12 months.
Bookmaker Webis Holdings PLC (LON:WEB) tumbled 17% to 1.2p as it swung to a full-year loss of US$930,000, versus a profit the year before of US$103,000, as the exit of a large syndicate caused amounts wagered with the company to slump to US$136,353 from US$461,154.
Finally, coal miner Edenville Energy PLC (LON:EDL) found itself underground, tumbling 20% to 0.03p after revealing that it had taken out an expensive loan to keep itself afloat after production levels from its Rukwas project in Tanzania over the last two months fell well below the plant’s capacity.