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Highlights

  • hVIVO reported a significant HCT contract cancellation and trial delays, attributing the changes to broader pharmaceutical industry volatility.
  • The company maintains GBP 47 million in contracted FY25 revenue but warns of potential operating losses without additional contract wins.
  • Despite setbacks, hVIVO sees growth opportunities in diversified services and integration of recent acquisitions.

hVIVO plc (LSE:HVO) is a UK-based contract research organisation specialising in human challenge clinical trials. The company also offers laboratory and early-phase clinical trial services through its subsidiaries, including CRS and Venn.

The company has reported a cancelled human challenge trial (HCT) contract, alongside a separate postponement and another smaller study cancellation, citing broader instability within the pharmaceutical sector and ongoing difficulties in biotech financing, particularly in the United States. The company indicated these disruptions are affecting the wider Contract Research Organisation (CRO) industry, resulting in higher cancellation rates and project delays.

The cancelled and delayed projects come despite a record sales pipeline, which the company says includes large opportunities currently in advanced discussions. These potential deals, if finalised, could begin later in 2025 and contribute to revenues in the 2026 financial year. However, in the near term, hVIVO faces the impact of the lost contracts on its 2025 earnings outlook.

The company now has GBP 47 million in contracted revenue for fiscal year 2025, inclusive of cancellation and postponement fees. While this figure represents a substantial base of secured income, management noted that if no further contracts are secured during the year, the company could post a mid-single-digit operating loss before exceptional items. All but one of the current FY25 contracts have already begun.

Despite near-term financial challenges, hVIVO noted ongoing progress in the integration of recently acquired businesses CRS Mannheim and Kiel, and Cryostore. Management highlighted emerging revenue synergies between these businesses and Venn Life Sciences, part of its broader strategy to diversify income streams beyond traditional human challenge trials.

The company stated it remains funded to continue its operational strategy. A trading update for the first half of the year is expected in late July, at which point further clarity on the FY25 outlook may be provided.
HVO shares were trading 50.62% lower at GBP 8.20 per share at the time of writing on 30 May 2025.