(MENAFN - ProactiveInvestors - Australia) Alchemia (ASX: ACL) expects to receive a total of A3 million under the Australian Government's R&D Tax Incentive for expenditure during the 2012 financial year.
Around 2 million of this relates to offshore R&D expenditure by Alchemia Oncology, while about 1 million is expected to be received for Australian R&D expenditure.
Alchemia is a small molecule biopharmaceutical company focused on its lead drug, fondaparinux " a generic version of GlaxoSmithKline's Arixtra, a synthetic anticoagulant mainly used for the prevention of deep vein thrombosis.
A successful finding relating to overseas expenditure not only applies to Alchemia's overseas phase three trial activities undertaken in the 2012 financial year, but also applies to these activities for the 2013 and 2014 financial years.
During these three financial years, the company expects to invest a total of over 20 million in the component of its phase three trial program covered by the overseas finding.
As a result, Alchemia stands to receive a 45% refundable tax credit of over 9 million across the three years, including the 2 million for the 2012 financial year.
The company has also made application to AusIndustry for a refund of its Australian R&D expenditure for the 2012 financial year, which is currently under review.
Approval of this application is expected within the next few weeks, and should net Alchemia over 1 million before the end of the year.
Product pipeline
Fondaparinux was approved by the U.S. Food and Drug Administration and launched in July 2011 in the U.S. by Alchemia's marketing partner, Dr Reddy's Laboratories.
The company achieved its first profit from the sales of the drug in the U.S. this year.
Alchemia also filed for approval in Europe in April this year.
Meanwhile, the company has spun out its oncology assets into a separate company, Alchemia Oncology.
The demerged entity is focused on developing Alchemia's HyACT technology which is designed to enhance existing drugs used for cancer chemotherapy to develop a new generation of anti-cancer drugs that demonstrate better efficacy than existing drugs.
The lead product from the HyACT platform is HA-Irinotecan for which a phase three clinical trial has been initiated in metastatic colorectal cancer.
