Shares in Avexa Limited (ASX:AVX) have risen by over a third since the beginning of July.
The drug discovery and development company recently announced that it was ceasing further development of its HIV drug, ATC citing unsuccessful partnering discussions with global pharmaceutical companies. The May 10 announcement coincided with the resignation of CEO Julian Chick and the market promptly wiped off 75% of the company’s market value, dropping from 13c to just over 3c.
The share price has recovered from a low of 0.024c to more than double that today, apparently underpinned by purchasing from Calzada Limited (ASX:CZD) which owns PolyNovo Biomaterials and Metabolic Pharmaceuticals. Calzada purchased 13M shares on market raising its voting power to 16.06%.
The board of Avexa sent a note to shareholders on June 25 advising them that there were a number of “inaccurate and misleading statements” in an anonymous letter sent to shareholders by “Shareholders that invested in Avexa for ATC”. The board stressed that positive trial results were important but they still required an HIV focused commercial partner willing to fund development and market the drug.
Avexa expects to have $23M in net cash as at June 30, 2010 and the company has recently cut head count in order to preserve this amount.
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