Human drug trial contracts drive 52% jump in revenue at Hvivo

Hvivo, the pharmaceutical services company formerly known as Open Orphan, has reported a jump in trading revenues in the first half of the year compared with the same period last year and a widening of its earnings margins amid “continued growth in demand” for its human challenge trials.

In a trading update on Wednesday, the group said it expects to report half-year revenues of £27.3 million (€31.8 million), a 52 per cent year-on-year increase.

The Dublin and London-listed company said growth in its contracted order book of 11 per cent — from £70 million in the first half of 2022 to £72 million — underlined the appetite for its drug trials from the global biopharma industry. Hvivo also noted that the contract value sizes had continued to grow over the period.

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The group, which announced a new £13.1 million (€15.2 million) contract with a large global pharmaceutical company to develop an influenza B virus challenge model on Tuesday, now expects its earnings before interest, taxes, deductibles and amortisation (Ebitda) margin to be 19 per cent for the period due to “operational efficiencies” and the execution of multiple concurrent larger trials this year.

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Hvivo said its cash position was £31.3 million at the end of June, up from £15.9 million after the payment of a £3 million special dividend on June 9th.

Order book

Hvivo chief executive Mo Khan said that the first six months of the year had been a period of “excellent growth” for the business, “delivering strong revenues, healthy ebitda and continued cash generation”.

He said: “Since the end of June, our weighted contracted order book has increased even further following the recent announcement of our new influenza B human challenge model. This record visibility of revenue well into the second half of 2024 provides a strong basis for future trading, as well as additional flexibility and adaptability to efficiently manage our pipeline.”

Mr Khan said the board is confident that Hvivo will achieve its full-year revenue and earnings guidance.