Syntopix’s key acquisition sees trials move in-house

The acquisition will mean Bradford-based Syntopix will no longer have to send potential new acne, dandruff, body odour and gingivitis cures to outside laboratories for clinical trials.

“We’ll be able to do the trials in-house,” said Syntopix’s chief executive Dr Steve Jones. “It will mean we can conduct more sophisticated studies and it minimises the risk.

“Leeds Skin will add value to our development compounds further down the line.”

Wetherby-based Leeds Skin runs an independent commercial testing facility specialising in human skin microbiology and clinical dermatology research.

Leeds Skin will carry on working for its current clients, which include household names such as Boots, L’Oreal, Stiefel, a GlaxoSmithKline company, and PZ Cussons, following the deal.

Dr Jones said Leeds Skin’s main revenue generating arm is its artificial skin technology which is called the ‘Living Skin Equivalent’. The artificial skin can test products and can give accurate indications whether products can reduce wrinkles, treat dandruff or reduce inflammation.

Dr Jones said Leeds Skin has relied on word of mouth recommendations, but with Syntopix as its parent company it will have the room to expand.

Syntopix, which was spun out of Leeds University, also announced a placing to raise £2m.

Dr Jones said the extra funds will be used for working capital. Syntopix decided to raise the extra money now as it doesn’t want to have to return to the market to raise more cash at a later date.

The group is not planning any more acquisitions, but will now focus on developing its products.

The placing to raise £2m, before costs, will be by means of the issue of 50,000,000 new ordinary shares at 4p per share.

Syntopix said the acquisition is expected to be earnings enhancing.

“The acquisition of Leeds Skin is a pivotal transaction for Syntopix,” said Dr Jones.

“The significant cell biology experience of Leeds Skin will complement our own microbiological expertise, aiding development of Syntopix products.

“Together, we will have the capacity to run both clinical and laboratory studies to make rational choices of active compounds and confirm product claims.”

He added that the deal put Syntopix in a strong position to identify and develop products in-house to treat a variety of skin problems.

Shareholders will be asked to approve the deal at a general meeting on May 23.

Emma Marsden and Rebecca McCall from Walker Morris’ corporate department advised Syntopix.