GCIhVIVO announces new facility in Canary Wharf to meet growing demand for human challenge trials
() , a contract research organisation specialising in human challenge trials, announced plans for a new consolidated facility at the life sciences hub in Canary Wharf, London.
The larger facility will house quarantine bedrooms, advanced labs, an outpatient unit, and corporate offices across 2 floors. It comes as a response to increased demand for hVIVO's human challenge trial services, and will feature higher capacity with 50 quarantine beds and potential for expansion to 70 beds in the future.
hVIVO said the outpatient unit will facilitate Phase 2 and 3 field trials, and the expanded labs will significantly increase sample throughput and diversify the company's services.
The facility's first phase is scheduled for completion in Q1 2024, with the rest to follow in Q2 2024. hVIVO said its current Whitechapel and Queen Mary Bioenterprises Centre (QMB) clinics will close in 2024, but will remain fully operational during the transition. hVIVO will keep its Plumbers Row and Manchester FluCamp volunteer screening facilities.
"This strategic relocation to a larger and more sophisticated facility underscores hVIVO's commitment to advancing research in infectious and respiratory diseases. By leveraging highly secure and specialised state-of-the-art infrastructure and expanding its capabilities, hVIVO aims to make significant strides in the field of human challenge clinical trials. Additionally, the new facility is expected to contribute positively to the Company's Environmental, Social, and Governance (ESG) goals." hVIVO said in a statment.
View from Vox
More positive news from hVIVO as it continues on its growth trajectory, fueled by rising demand for its human challenge trials. The new state-of-the-art facility is a response to the company's rapidly growing orderbook, which clocked in at £78m in H1 2023, with the most recent £13.1m contract signed in July for the development of an Influenza B virus challenge model.
The larger facility in Canary Wharf's life sciences hub is being largely funded by hVIVO clients seeking to accelerate their studies. It will enable hVIVO to conduct significantly more trials concurrently across various challenge models, which should translate to higher revenues. The site will feature increased capacity with up to 70 quarantine beds and expanded labs, enabling hVIVO to work with a broader range of pathogens. The consolidation of operations into a single building should also result in improved operational efficiency and improving margins.
In H1 2023, hVIVO saw revenues climb 52% to £27.3m, compared to £18m in the same period last year. EBITDA margins also improved significantly to 19% from 12.7% last year, implying an EBITDA increase of 126% to £5.2m, while net cash doubled to £31.3m as of 30 June 2023 compared to £15.9m a year ago. The company said it was on track to hit full-year revenue and EBITDA expectations.
hVIVO continues to be highly cash generative, even after the payment of a £3m special dividend in June 2023. Underlying free cashflow (before the payment of the special dividend) was £6m in H1, reflecting strong EBITDA growth and upfront customer payments. hVIVO is already fully contracted to achieve its full-year revenue guidance of £53m with EBITDA margins "in the mid to high teens".
hVIVO's strong numbers in recent quarters testify to the ongoing high demand for human challenge studies. Such studies provide great value for biopharma as they offer access to fast and cost-effective data that enables easy decisions ahead of larger Phase 2 trials, giving companies the best chance of quickly advancing their candidates through the development pathway.
shares rose 2.86% on today's announcement.
hVIVO CEO Yamin 'Mo' Khan discussed the new facility with Vox's Lauren Gibbons this morning. Click here for that conversation.
Follow News & Updates from hVIVO:
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.