Business
Winnipeg Free Press - PRINT EDITION
Cangene doubles profits, hits record sales during downturn
PHIL HOSSACK / WINNIPEG FREE PRESS ARCHIVES Enlarge Image
John Langstaff: ‘We don’t think we need to worry about life after bio-defence.’
WINNIPEG-BASED Cangene doubled its profits and generated record sales in the worst economy in memory and says it believes there is still plenty of growth left in its lucrative bio-defence work.
Much of the sales and profit growth for the year ending July 31 came from bio-defence products it sells to the U.S. government -- specifically botulism antitoxin and anthrax immune globulin.
The company's revenue increased by 44 per cent to $238.8 million and profits doubled to $60 million for the year.
Investors jumped enthusiastically on the Cangene bandwagon Thursday, sending the stock up more than 40 per cent to $6.39 in one of its heaviest trading periods in months.
So far, it has only shipped about one-third of the $500-million-plus bio-defence order it has with the U.S. strategic national stockpile, with the remainder expected to be delivered over the next couple of years.
But John Langstaff, Cangene's CEO, said that will not necessarily be the end of the revenue potential for those products.
"The message we are trying to get out there is that we don't think we need to worry about life after bio-defence," he said. "We view bio-defence as similar to Lockheed-Martin's relationship with U.S. military in aerospace -- it is a long-term business endeavour."
Douglas Loe, an analyst with Versant Partners in Toronto, has a $10 target on the stock, even though he says it is "a jump ball" as to whether or not the company will be able to extend the current U.S. bio-defence contracts past 2011, when most of the existing orders are to be delivered.
"There is lots of arm-waving and vague allusions," Loe said, referring to the company's expectations the contracts will be extended.
But Langstaff said there is plenty of reason to believe that will be the case. He said not only does Cangene have the capacity to deliver even more than the current order, it had to demonstrate it had that capacity in the first place.
In addition to the botulism and anthrax products and vaccinia immune globulin, which counteracts negative reactions to the smallpox vaccine, the company is negotiating its largest research and development contract ever for the development of a therapeutic to treat acute radiation syndrome.
When negotiations are complete, it will be a five-year project Langstaff said could also result in licensing of a compound and potential future sales.
In addition to its record-breaking top and bottom lines, the company sports a balance sheet free of debt.
It is in the process of undertaking preliminary regulatory filings that might eventually lead to a stock listing on a U.S. exchange.
"We could probably borrow funds from our banks, but if we wanted to do a significant acquisition we might want to raise money on the public market," Langstaff said.
The company bought a small Vancouver firm called Twinstrand Therapeutics in July and earlier this month paid $7 million up front for the U.S. commercial rights for HepaGam B, used in the treatment of hepatitis B.
Cangene had done most of the research and development work for that compound for Apotex Inc. Cangene will also pay royalties until 2016 to the Mississauga pharmaceutical company, which owns about 50 per cent of Cangene's shares.
Cangene develops most of its compounds using purified human plasma, sometimes extracting antibodies that can be used as therapeutic treatments.
It is doing work in that regard focused on the H1N1 virus.
Langstaff said the company is seeking funding support to continue that work, but he does not believe it will be available for the current round of immunization work.
Cangene Corp.
$238.8 million -- annual sales for year ending July 31, 44 per cent better than the previous year
$59.9 million -- profit for the year, a 102 per cent increase.
700 -- total employees, including 550 in Winnipeg
$0 -- total debt outstanding
49 per cent -- amount of Cangene's shares owned by Apotex owner Barry Sherman
Republished from the Winnipeg Free Press print edition October 23, 2009 B4
- Rate this

-
-
We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high. If you thought it was well written, do the same. If it doesn’t meet your standards, mark it accordingly.
You can also register and/or login to the site and join the conversation by leaving a comment.
Rate it yourself by rolling over the stars and clicking when you reach your desired rating. We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high.
There are no comments at the moment. Be the first to post a comment below.
Post Your Comment
The Winnipeg Free Press does not necessarily endorse any of the views posted. Comments are moderated before publication. By submitting your comment, you agree to our Terms and Conditions. New to commenting? Check out our Frequently Asked Questions.
-
Faith Enduring
A look at Manitoba’s Ukrainian community through their churches
-
The Forgotten Disease
The fight to eradicate tuberculosis is far from over.
-
Flu Fight
News about the world's battle against the H1N1 flu pandemic
-
Follow the Way!
Join United Way on its journey toward lasting change and better lives.
-
Winnipeg road closures
Check if your commute is affected
-
Editor's Bulletin
Sign up for daily bulletins
-
Blogs to Watch
We pick our favourite local blogs for you to follow
-
Breaking News Widget
Create and embed a Winnipeg Free Press breaking news widget on your site or blog
- Back to Top
- Return to Business
Advertisement
Most Popular
- Sod turned at IKEA site today
- Manitoba man killed in crash in Nebraska
- Jury finds man guilty in execution-style slaying
- Horror at the movies? That's the snack booth
- Southern chiefs blast Hydro
- Rush hour crash closes Wilkes
- Woman charged in year-old homicide case
- Will you get the H1N1 flu vaccine?
- Police looking for missing girls
- Find lukewarm lovers who fit your style
- Southern chiefs blast Hydro
- Sod turned at IKEA site today
- Find lukewarm lovers who fit your style
- Activists protest delay over Kapyong housing
- Province takes aim at stubble fires
- Ignatieff, McFadyen do the shuffle dance
- Addicts out in cold: workers
- Horror at the movies? That's the snack booth
- Rush hour crash closes Wilkes
- Jury finds man guilty in execution-style slaying
- Sod turned at IKEA site today
- Horror at the movies? That's the snack booth
- Southern chiefs blast Hydro
- Health Canada warns vets and pet owners about drug used to treat diabetes
- 300 homes evacuated, schools closed after heavy rain, high tide flood Duncan, BC
- Mortgage rates likely to rise soon
- Activists protest delay over Kapyong housing
- Children helping children is charity's goal
- Asthma appears to be significant risk factor in kids for severe H1N1: study
- Addicts out in cold: workers
Ads by Google


PREVIOUS

0 Comments