Cyprotex

Drug discovery services provider Cyprotex is moving into toxicology after pre-tax profits down 15% to £460,413.

The Macclesfield-based company, which has rejected an unsolicited bid approach made three weeks ago from an unnamed party, saw turnover slip by £180,000 to £5m last year, as some of the client discovery companies using Cyprotex assays cut their outsourcing budgets. Three in particular were diverted by merger activities and revenues from the company’s largest customer fell by £600,000.

But AIM-quoted Cyprotex, steered by chief executive officer Dr. Anthony Baxter, fought back, doubling to six its ‘strategic’ customers, each generating revenues of more than £250,000, forming a strategic alliance with medicinal and computational chemistry services provider Sygnature and winning a key new customer. The company’s year-end cash rose 31% to £2m, some of which will go to developing new assays, while directors are scouting for acquisitions, provided vendors moderate their price expectations.

Financier and Tory donor Michael Spencer holds 15% of Cyprotex, which specialises in absorption, distribution, metabolism and excretion (ADME) data. The company is moving into in vitro toxicology, a field which the very success of ADME work is bringing to the fore by enabling more stable molecules to remain in patients’ bodies for longer.

Cyprotex, which currently derives half of its revenue from central Europe, is also beefing up its US sales team. Floated at 29p eight years ago, the shares are now only 3.63p, where they offer speculative recovery appeal.