APPENDIX 1
Letter to the Clerk of
the Committee from Mr J Wilson Carswell OBE
I see from today's Financial Times that the
committee of which you are the Clerk is considering investigating
British Biotech, "as part of a drive to promote sagging public
confidence in the biotechnology industry".
I was at one time Managing Director of a start-up
company called Stanford Rook. This had one biological product,
which was thought to have a beneficial therapeutic affect on clinical
tuberculosis. A number of clinical trials on patients with tuberculosis
was carried out outside the UK.
The company wanted to float on the London 4.2
market, in early 1995, with a view to moving onto the AIM market
later that year. To this end they published some flotation documents.
I felt that these documents contained statements about the previous
trials that were unduly optimistic and could not be sustained
by the available data. Therefore, I declined to sign the prospectus
and thus resigned as a director and later as an employee.
Two years later the results of a much bigger
and better-controlled clinical trial was publicly announced. This
showed that the therapeutic agent had no beneficial effect in
the treatment of uncomplicated clinical tuberculosis. The company
discontinued its work in that area. Meanwhile the share price
of the company collapsed, wiping out about £80,000,000 from
the value of the company's shares.
In late 1997 I wrote to and later met the regulatory
officer at AIM. I suggested that the regulatory process had been
less than perfect with respect to the flotation of Stanford Rook
and could be improved.
AIM looked into the matter but has not apparently
made any changes to the regulatory process. Enclosed[1]
is a copy of a letter that I wrote to AIM last month suggesting
some of the possible changes that they might introduce for biotechnology
companies.
The key issues in Stanford Rook centre on the
quality and veracity of clinical trial data. This has obvious
parallels with British Biotech and I would therefore be grateful
if you would bring this letter to the attention of your committee.
Thank you for your assistance in this matter.
17 June 1998
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