Moulton backs launch of biotech firm Redx Pharma

A NEW biotech company, Redx Pharma, has been launched after raising £1.9m to develop a new range of medicines by modifying and enhancing existing products.

The Liverpool-based firm has attracted investment from the public and private purse, and counts leading private equity investor Jon Moulton among its backers as well as the North West Interim Venture Capital Fund.

Redx will develop products based on existing classes of drugs, structurally modifying them to create new proprietary medicines. Benefits for patients will include fewer side effects and ease of use.

Its Redox Switch technology allows rapid assessment of potential new drugs, which can go forward to development programmes with lower risk and greater speed to clinical trials.

By entering into licensing agreements with major drugs companies Redx aims to build a multi-million pound business.

As part of the investment it has bought the assets of Bradford Pharma and will take over its operations at Merseybio, the incubator unit owned by the University of Liverpool. The funding has allowed the business to increase its team from four to 10.

Redx Pharma has a wide pipeline of new compounds in multiple therapeutic areas. It is working in four areas at the moment – cardiovascular medicine, influenza, antibiotics and neuropathic pain.

The syndicate of private investors was brought together by Acceleris, the Manchester-based corporate finance boutique, which is also a founding shareholder.
Private investors hold 75% of the business, while The North West Interim Venture Capital Fund, which is managed by Yorkshire Fund Managers, has the remainder.

Acceleris director Norman Molyneux commented:  “This is a positive development for the North West biotech sector and we are all excited about where Redx Pharma goes from here.

“Deals of this nature have been scarce over the last 18 months and it’s fair to say the Enterprise Investment Scheme – a tax incentive to encourage support for small companies – was instrumental in helping us put the package together.”

The Redx Pharma management team is led by industry veterans Dr Neil Murray as chief executive and Dr Peter Jackson, chairman.

Dr  Murray said: “Redx Pharma will be at the forefront of biotech in the North West and this investment leaves us well placed to exploit the state-of-the-art facilities we have at Merseybio, our close links with University of Liverpool and the enormous potential of the global pharmaceuticals market.

“We did look at the potential for relocating, but very quickly came to the decision that this was the best region for it to be based, in terms of there being a cluster of biotech businesses, links to universities and a strong labour market.”

Jon Moulton added: “Redx Pharma has very interesting technology and strong prospects.”

Doug Stellman, investment director at YFM Private Equity added: “There is good public awareness of the continual battle to develop new formulations of antibiotics as bacteria acquire resistance to existing drugs.

“The company has a technology platform that will allow it to develop new formulations for antibiotics and other important drug classes.

“It is hugely pleasing to see this Merseybio-based business close on a significant round of funding from investors who have recognised the potential of the technology and are prepared to invest at this stage.”        

Frank Shephard and a corporate team from DWF Manchester gave legal advice to the Redx Pharma board. A team from the Manchester office of Cobbetts comprising corporate partner Nicola Frost and director Paul Kelly, provided legal advice to YFM.