Fusion Antibodies announces further contract unlikely to improve cash constraints

Fusion Antibodies has won a further contract from a returning pharmaceutical client, in a modest boost for the antibody specialist.

But the contract, worth just £45,000, is unlikely to excite investors, and it raises the question of whether it’s worth the RNS distribution.

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The company said a European-listed global pharmaceutical company had awarded it a new project using its proprietary antibody-engineering technology, under an existing master services agreement.

The work, which involves fine-tuning the client’s lead antibody, is expected to be completed within the current financial year.

Adrian Kinkaid, CEO of Fusion, said: “We are delighted to have secured this new RAMP project with a returning global pharmaceutical client. It is particularly encouraging to re-engage with an established customer for whom we have previously undertaken similar work, demonstrating the continued relevance of our specialist antibody engineering capabilities.”

However, the deal will not materially affect the business, which recently announced that its first-half revenues would nearly halve. Announcing such small deals can signal desperation from the management team.

Fusion Antibodies shares

Fusion Antibodies shares are down 58% year-to-date and may well need to raise cash at some point after recently saying it was ‘actively reviewing the Company’s working capital requirements’. This could be a painful experience for existing investors.

In mid-October, the company said it would update the market on its cash management initiatives. Today’s update made no mention of any action or progress on working capital management.