C4X Discovery aims to raise £7m to invest in partnership deals

Drug developer C4X Discovery is to raise £7m in order to strengthen its balancing sheet amid discussions for partnerships and strategic collaborations.

The company aims to capture the increasing value related to pre-clinical licensing deals by focussing on disease areas with high partnering interest with the current areas of focus being inflammation, neurodegeneration, immuno-oncology and diabetes.

The number of pre-clinical deals worth greater than $10m increased from 50 in 2012 to 78 in 2015 and the value of upfront payments for these deals rose 289% to $243bn over the same period, according to analysis by the Biotechnology Innovation Organisation in May 2016.

C4X will raise about £7m before expenses through a placing of up to 8.23m shares, which represent about 22% of its share capital, through an accelerated bookbuild on Tuesday.

The new shares are expected to admitted to trade on AIM on 3 April.

Chief executive Clive Dix said: "This fundraise will enable us to accelerate towards our goal of becoming the world's most productive, self-sustaining drug discovery engine.

“We will use the funds to expand our commercial capabilities and continue building our portfolio of commercially attractive pre-clinical assets."

Shares in C4X Discovery were down 0.55% to 91p at 0956 GMT.