James Packer takes a substantial stake in Australian biotech company

The Packer family’s Ellerston Capital has become a substantial shareholder in Acrux, taking a 5.4% stake in the biotechnology company.

Acrux is an Australian drug delivery company, developing and commercialising a range of patented pharmaceutical products for global markets which use technology to administer drugs through the skin.

Ellerston Capital joins AMP and Paradice Investment Management as a substantial shareholder in the biotech company. All three hold just over a 5% stake each, with the remainder of Acrux’s stock held by various institutions and individuals.

Jon Pilcher, chief financial officer of Acrux, told SmartCompany Acrux was “very happy” to have Packer’s company as a shareholder.

“It is another vote of confidence in the company to have new institutions and shareholders of that quality and reputation on the register,” says Pilcher.

Pilcher says he believes Packer was attracted by Acrux’s established business and says it is different to many biotech companies.

“We are a little bit different because we are profitable and paying dividends, we are no longer in the very risky phase,” says Pilcher.

Acrux has two products marketed by licensees in the USA, two products approved in Europe, one product in registration in the USA and further products at earlier stages of development.

The company reported half-year profits this year of $5.1 million mainly based on its key product, Axiron, which is used for testosterone therapy.

“It is marketed by Eli Lilly globally, but at the moment only on sale in the US. But the market is growing at more than 20% per annum and Eli Lilly has taken 12% market share in the first year,” says Pilcher.

“We are very excited for the prospects for Axiron in the United States.”

The investment in Acrux marks Ellerston Capital’s move into new sectors following its successful investments in online retailers Catch of the Day and Deals Direct.