OptiBiotix Health reports wider first half loss

OptiBiotix Health’s shares dropped on Thursday as the medical product developer reported a wider first half loss.

In the six months to the end of May, the loss before tax widened to £713,772 from £514,424 the same period a year earlier as administrative expenses grew to £802,083 from £514,431. Revenue came to £88,252, compared to no revenue in the first half of 2015.

Cash flow was £3.55m, which the company said is sufficient to fund existing research and development programmes.

During the first half, the company increased its intellectual portfolio to 44 patents across 14 product families, eight strain registrations and seven trademarks.

The company signed two commercial agreements, the first with KSF, owners of the Slimfast brand, and the second with DSM, the world's leading supplier of nutritional ingredients. These agreements brought in short term revenue to cover development costs and has created a route to market products with established brand suppliers and generates future revenue streams.

It also bought skin microbiome intellectual property and created a majority owned joint venture, SkinBiotix, with the University of Manchester in February, which is expected to create new product opportunities in multi-billion dollar global markets including skincare, health care acquired infections, eczema, psoriasis, and wound care.

Chief executive Stephen O'Hara, said: "OptiBiotix has made significant progress in the last six months advancing our development programmes, building our IP portfolio, and signing commercial agreements with two multinationals.

“We are delighted to have GoFigure products containing SlimBiome on the shelves in a major retail chain with strong early sales and great customer feedback suggesting a high likelihood of success."

The company also said that in the last six months there had been increased interest in microbiome and a growing number of publications showing its potential to prevent, manage, and treat human disease. The US government announced a $0.5bn Microbiome initiative in the spring of 2016, which has led to growth forecasts for the human microbiome market of a compound annual growth rate (CAGR) of 22.3%.

OptiBiotix develops compounds which modify the human microbiome and commercialises them by partnering with food, health, wellbeing and pharmaceutical companies.

Shares in OptiBiotix Health were down 5.27% to 70.10p at 1203 BST.