This maker of proteins, viruses and DNA for use in novel pharmaceutical treatments is firmly on the road to recovery, following a disastrous 2004. The second half of the year to last September produced a profit for the first time in 18 months and the group could break even in the current year.

Cobra’s business is now focused on supplying products to US biotechs. This is where most such drug development takes place. Until now most work has been undertaken for treatments in pre-clinical or Phase I and II clinical trials.

Now Cobra has secured a contract to supply products to Auxilium Pharmaceuticals for its Phase III trials for a drug to treat Peyronie’s disease, a condition that results in the erect penis becoming bent. This is worth at least £3m and is significant considering revenues rose 120% last year to £7.7m. That enabled last time’s £2.3m loss to be cut to just £0.4m.

Better still cash remains at a healthy £3m, down just £200,000 over the year. Chief executive David Thatcher believes that, if Auxilium’s Phase III trial is successful, Cobra’s chances of securing the contract to make the drug commercially are high.

House broker Seymour Pierce reckons the group will break even this year. With the market cap at a lowly £11m, against a forward order book of £5m, now could be a good time to buy shares.

Cobra Bio-Manufacturing	AIM	£0.89m	2.00p	0.00p
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