LONDON (ShareCast) - Drug developer Vernalis has signed an exclusive collaboration, option and license agreement with GlaxoSmithKline relating to a Vernalis research programme against an undisclosed oncology target.

Under the terms of the deal, Vernalis will receive $6m upon signing (including a $3m equity subscription by GSK for 2.04m shares at 87p per share) and is eligible to earn up-front and potential milestone payments in excess of $200m and up to double digit royalties based on worldwide sales of an oncology product. Further milestones and royalties could be earned should products against the target be developed for indications outside of oncology.

Fabrics group Fiberweb slipped into losses of £13m in the half year to June as revenues dropped, though the firm says there are some signs the market is now stabilising.

Revenues fell by 6.8% to £242.5m reflecting the impact of both the pass-through effect of lower raw material prices and lower volumes. A 17% volume decline resulted from pressure on industrial and airlaid segments mitigated by defensive consumer fabrics performance; some signs of market volumes stabilising. Underlying profit was flat at £4.5m (£4.4m).

As no sustained volume recovery is yet apparent, Fiberweb intends to continue improving its competitive position, the statement added.

Contractor Carillion has been awarded a contract by the Scottish Prison Service to design and construct the new HMP Low Moss, worth in the region of £116m. The project involves the design and construction of a 700 cell prison located near Bishopbriggs in East Dunbartonshire. The prison is expected to open in 2012.

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