prr signs licencing deal with zymogenetics, page-10

potentially 25million $ deal prr signs licencing d ASX enforces draft biotech code
By Rebecca Urban
December 16, 2004

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The Australian Stock Exchange appears to have toughened its stance on announcements from the biotechnology sector, with at least one company being asked to water down comments about a new licensing deal.

Prima BioMed was yesterday delayed from releasing a statement to the market because it was told by an ASX officer that information provided about the value of the deal did not comply with an industry code of conduct for reporting.

The code, developed by the exchange in conjunction with industry peak body AusBiotech, is still in draft form and companies have no legal obligation to follow it.

Prima has licensed the rights to its anti-inflammatory technology to ZymoGenetics in a deal potentially worth $25 million over several years - including milestone payments and royalties. However it was asked to remove the figure because it could not disclose the individual tranches of the overall payment.

The company initially complied to get the announcement published, but later decided that it would release the information to those who requested it.

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AdvertisementChairman Eugene Kopp said while he supported the role of ASX in regulating company announcements, advice from the company's lawyers and stockbrokers indicated that the potential value was important information that should be disclosed to investors.

"In biotech the bread and butter is potential sales," Mr Kopp said. "It's still material and in my view, we should be disclosing it."

ASX public relations manager Christine Harris said the issue was a matter between the company and the exchange.

A 15-member committee formed by AusBiotech will meet for the first time in Sydney today to discuss revising the code into a document that companies are willing to follow.