Allergy Therapeutics raises £12m to develop peanut and dust mite treatments

Shares in Allergy Therapeutics fell as, despite a strong trading update, the company launched a £12m discounted fundraising to speed development of treatments for peanut allergy and house dust mites allergies.

The AIM-listed company completes the institutional placing by mid-afternoon on Tuesday, with £11.5m raised before expenses at 28p per share, shy of its 31.38p closing price on Monday, not far from their recent seven-year high.

Trading in the first four months of 2016 showed a 12% like-for-like growth at constant currency rates, or 15% if the Alerpharma acquisition of June 2015 is included.

European demand for the company's unique short-course aluminium-free allergy hayfever vaccines was a big driver, with continued strong demand since the 30 June year end, with notably strong growth in Germany, Austria, Netherlands and Spain.

Given the results are traditionally strongly weighted towards the first half, management are confident of strong results for the full year.

Allergy Therapeutics said they completed the fundraising after recently acquiring the licence for Virus Like Particles (VLP), a new technology to be used in the treatment of peanut allergy.

The company intends to use the VLP licence in the development of Polyvac Peanut, a new injectable vaccine immunotherapy treatment for allergy sufferers, through to Phase I clinical trials, which would be the company's first move into food allergies.

It also aims to take its house dust mite treatment, Acarovac Quattro, through Phase I clinical trials and to launch it in Spain on a named patient basis targeted for 2017.

House dust mite is the world's most common cause of allergy and is estimated to affect over 90m people in Europe, North America and Japan alone.

House broker Panmure Gordon, which completed the placing on behalf of the company, said the new products represent "substantial new market opportunities" and it will be updating its forecasts as a result.