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Xenova Group PLC (XEN)

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Friday 03 September, 2004

Xenova Group PLC

Disposal

Xenova Group PLC
03 September 2004


                                Xenova Group plc

        Canadian Manufacturing Facility Sale Completes Planned Disposals

Slough, UK, 3 September 2004 - Xenova Group plc (London Stock Exchange: XEN;
NASDAQ: XNVA) announces that it has completed the disposal of its manufacturing
facility in Edmonton, Canada, to QSV Biologics Ltd (QSV) for C$7.0 million (£2.9
million).  This sale concludes the planned disposals and cost reduction
programme announced at the time of the acquisition of KS Biomedix.

The consideration comprises an initial payment of C$5.0m in cash payable upon
completion, and further deferred consideration of C$2.0m payable in two equal
secured promissory notes maturing 12 and 18 months following completion.  The
proceeds from this disposal will be used to fund expenditure relating to the
Group's prioritised programmes.  Net assets disposed as part of the transaction
amount to C$6.6 million (£2.7 million).

In addition to the sale of the facility, terms have also been agreed for a
manufacturing and supply contract with QSV for TransMID(TM) which is presently
under development in Phase III clinical trials.  The annualised reduction in net
operating expenses as a result of the disposal, ignoring the impact of the
manufacturing contract, will be approximately £1.8 million.  All of the   Xenova
employees, in total 30, transferred to QSV upon completion, including those
involved in the production of TransMID(TM).

Today's sale proceeds together with the disposal announced in January 2004 of
surplus facilities in Farnham, UK, amount to a total of approximately £3.7m. In
addition, in April 2004, a 10 year lease agreement was signed with Genzyme
Limited for vacant space in Xenova's facilities on the Cambridge Science Park,
UK.

David Oxlade, Chief Executive Officer said, 'The sale of this manufacturing
facility completes the programme of planned disposals instigated since the
acquisition of KS Biomedix last year.  The manufacturing contract provides us
with security over the production of our lead drug TransMIDTM which recently
entered Phase III clinical trials.'

Contacts:

Xenova Group plc                                             +44 (0)1753 706600

David A. Oxlade, Chief Executive Officer
Daniel Abrams, Finance Director
Veronica Cefis Sellar, Head of Corporate Communications

UK - Financial Dynamics                                     +44 (0)20 7831 3113

David Yates
Ben Atwell

US - Trout Group/BMC Communications                         +1 212 477 9007

Media:                      Brad Miles
Investors:                  Lee Stern

Xenova Group plc is a UK-based biopharmaceutical company focused on the
development of novel drugs to treat cancer and addiction with a secondary focus
in immunotherapy.  The Company has a broad pipeline of products in clinical
development, including three cancer programmes:  its lead product TransMIDTM,
for the treatment of high-grade glioma, is in Phase III trials, and its novel
DNA targeting agents and XR303 are both in Phase I for cancer indications.
Xenova is also developing two therapeutic vaccines for cocaine and nicotine
addiction, which are in Phase II and Phase I trials respectively.  Quoted on the
London Stock Exchange (XEN) and on NASDAQ (XNVA), Xenova employs approximately
75 people throughout its sites in the UK and North America. (Reuters XEN.L;
Bloomberg XEN LN)

For further information about Xenova and its products please visit the Xenova
website at www.xenova.co.uk.


QSV Biologics Ltd, based in Edmonton, Canada, provides a full range of mammalian
cell culture and microbial fermentation related biopharmaceutical contract
manufacturing services for pre-clinical research, Phase I, II and III clinical
trials materials as well as commercial materials to Canadian, US and European
biotechnology firms with protein therapeutics in development. QSV is a
dedicated contract manufacturing operation. More information can be obtained
from www.qsvbiologics.com.


Disclaimer to take advantage of the 'Safe Harbor' provisions of the US Private
Securities Litigation Reform Act of 1995. This press release contains '
forward-looking statements,' including statements about our ability to realize
cost savings. Various risks may cause Xenova's actual results to differ
materially from those expressed or implied by the forward looking statements,
including: unexpected costs and delays, adverse results in our drug discovery
and clinical development programs; our dependence upon strategic alliance
partners to develop and commercialize products and services. For a further list
and description of the risks and uncertainties we face, see the reports we have
filed with the Securities and Exchange Commission.  We disclaim any intention or
obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.



                      This information is provided by RNS
            The company news service from the London Stock Exchange