ARDANA, the Edinburgh pharmaceutical firm, has given up its race to find cash and placed itself in administration.
The company, which focuses on treatments for human reproductive conditions, effectively raised the "for sale" sign in February, calling for interested parties to buy it or merge to provide the cash to develop its portfolio.
In a statement yester
day, Ardana said it had been in discussions with a number of parties about licensing tie-ups but had concluded those deals could not be completed before its cash reserves had been exhausted.
It added: "As a result, the board of Ardana has taken advice and, with great regret, no longer believes that the company is in a position to continue its operations."
Talks over any possible deals were halted on Friday, with David Duggins and Tom Burton of Ernst & Young appointed as administrators.
Ardana added: "It is expected that the appointment of administrators will formally occur later ... following which the administrators will take such measures as they believe appropriate including continuing to seek a buyer for the company and its assets."
On Friday, Ardana requested trading in its shares, listed on the main London Stock Exchange, be suspended from trading pending clarification of its financial position.
The problems which have caused Ardana's collapse have been felt across the biotechnology sector. By definition the companies are high risk, and rewards often require investors to invest high levels of cash and wait years for a return.
In February, Wilson Totten, the chief executive of Borders-based pharma company ProStrakan, and an industry veteran, said the conditions for raising cash in the equity markets were the worst in his career.
"It is as bad as I have ever seen it. It was certainly a lot easier to raise money in the 90s and even easier in the 80s," he said at the time. "The banks are wobbling, the equity markets are wobbling and people are looking for low-risk, and if necessary low-return, homes for their money. Biotech isn't that; traditionally it's a boom or bust sector."
Totten said ProStrakan, which is funded through to forecast profitability, had been approached by a number of biotech companies seeking a merger but had rejected these saying they would add nothing to the company.
The full article contains 381 words and appears in The Scotsman newspaper.
