Fledgling pharmaceutical stock set to grow

ALLTRACEL Pharmaceuticals, the Dublin-based manufacturer of anti-bleeding and wound-care products, will continue its strong share price momentum, according to research published last week by Davy stockbrokers.

The company, which listed on London’s Alternative Investment Market (AIM) in 2001, has seen its share price rise from 14p at the start of the year to its current level of 44p.

It now enjoys a market capitalisation of over £30m (€44m) but is still some way off its listing price of 89p.

Davy said there was considerable scope for the price to reach 89p in the medium term, driven by positive newsflow from the company's product launches in Europe and the US.

According to Davy, the company will need to raise up to €5m in the short to medium term to help finance expansion.

It currently employs 22 people and has already raised over €7m from its AIM listing and subsequent fundraising and private placements of shares.

Davy said Alltracel could increase its revenues from €1m in the current year to €4m next year and over €14m by 2006. Davy also said the company would need to spend heavily on marketing over the next three years to ensure that its products became widely accepted in the market but that it would reach break-even by 2006.

The company has developed a patented technology, m-doc, which is used as an anti-bleeding ingredient in plasters. M-doc is made from natural fibres and accelerates a wound’s healing process.

Davy said Alltracel’s focus for the medium term would remain on consumer first-aid applications but that it expected additional research and development work to continue. The company has also developed Seal-On, its own brand of first-aid products, which include an aerosol spray that is applied to a cut to help stop bleeding.

Alltracel has signed a number of significant agreements with distributors in Britain, Europe and the US.

Boots, the pharmacy chain, will launch two products, spray and nasal plugs, using Alltracel's technology before the end of the year and will add further products from next spring.