Success is more than skin deep for novel drug delivery technology
Acrux is a small Australian-based drug delivery business proving that size is no obstacle when it comes to turning novel medical research into medicines sold around the world.
From its premises in West Melbourne the company signed in 2010 the largest single product licensing deal for an Australian biotech. The deal, with global pharmaceutical company Eli Lilly, was for Acrux’s lead drug, Axiron, a treatment for hypogonadism or testosterone deficiency in men.
Axiron has been on sale in the United States since 2011, and has gained a 12 per cent share of a market which is worth $1.5 billion and growing by more than 20 per cent a year.
And in May 2012, Acrux was celebrating approval of Axiron for sale in Australia by the Therapeutic Goods Administration, as well as its recommendation for listing on the Pharmaceutical Benefits Scheme.
Axiron is one of three products developed and commercialised by Acrux based on innovative technology invented by scientists at Monash University in the 1990s who found a new way to administer drugs through the skin.
Acrux’s products are fast-drying, invisible sprays and liquids which are applied to the
skin, delivering medicine transdermally into the bloodstream. Acrux has used this technology to also develop Evamist, for women, to treat the symptoms of menopause; and Recuvyra, providing post-operative pain relief for dogs and solving the problem of getting them to swallow pills.
“We have two human therapies approved for sale in the US, one human and one animal therapy approved in Europe, and further approvals pending in Europe, South Africa and South Korea,” said Acrux’s Chief Financial Officer, Jon Pilcher.
Jon says Acrux is proud to be in its third year of profit, and is planning regular dividends for investors.
“We are different from other biotech companies because we have always been determined to be profitable – we have always been adamant about providing returns to our shareholders, and the Australian Government’s Pooled Development Fund (PDF) initiative has helped us achieve this,” Jon said.
In 2009–10 Acrux achieved a maiden profit of $47 million, followed in 2010– 11 by a profit of $57 million. A special dividend of 60 cents per share ($100 million in total) was paid to shareholders in April 2011, and the company says regular dividends will commence in 2012.
Jon said that after registering as a PDF in 1999, Acrux successfully applied for a dollar-for-dollar innovation grant from the Australian Government, which enabled the business to get off the ground and start the long journey turning the Monash University invention into commercial products.
“The PDF was critical because we had to raise funds from angel investors who were attracted by our PDF status,” Jon said.
“The tax-free benefits of the PDF help attract patient investors, all the way through the company’s development – at formation, during our IPO on the ASX in 2004, and into the future. And these tax-free benefits also apply to dividends, which are an important component of the return for those investors.”
Acrux earns export revenue from licensees and distributors in pharmaceutical markets around the world. The success of the company’s products will generate ongoing benefits for Australia as the company pays 3.5% of these revenues to Monash University.