Shares in biotechnology company fell 50.5% yesterday on the Tel Aviv Stock Exchange (TASE) following news that Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) has ended a collaboration agreement with it. Procognia's shares ended at NIS 17.30 yesterday ProCognia (Israel) Ltd. (TASE:PRCG). The company said that Teva ended its collaboration with it on a feasibility study of the technology of a biopharmaceutical product. The situation of Procognia, which develops glycoanalysis and protein function arrays products and technologies, was already dire, and the ending of the agreement with Teva, its key customer, has merely added to its financial straits. The partnership with Teva generated NIS 460,000 out of the NIS 690,000 revenue Procognia posted for the third quarter.
The remaining portion of Procognia's revenue came from its exclusive marketing agreement in Israel with Dutch gene research and diagnostics company Qiagen NV (Nasdaq:QGEN; XETRA: QIA), which has also been terminated, effectively leaving the company without any sources of revenue. The company has been trying for some time to raise further funding or find a buyer, but has no success at all in this, even while the agreement in Teva was still in effect.
Procognia said in its notice to the Tel Aviv Stock Exchange (TASE) yesterday that it did not believe the termination of the agreement with Teva would affect its cashflow and workforce in 2009. The company had NIS 22.1 million in cash at the end of the second quarter, and a negative cash flow of NIS 3.9 million during the quarter.
Procognia, a subsidiary of UK biopharmaceutical company Procognia Ltd. has developed a method for real-time analysis of protein glycolsylation for use in the manufacture of pharmaceutical and diagnostic products, both independently and as a service to foreign companies.
Published by Globes [online], Israel business news - www.globes-online.com - on November 18, 2008
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