The future of Arix Bioscience (ARIX) looks in doubt after the chief executive of the life sciences investment company, once backed by former star fund manager Neil Woodford, announced his departure amid an ongoing strategic review.

Shares in the venture capital firm jumped 2% today after chief executive Robert Lyne said he was leaving ‘to pursue a new opportunity’, according to a stock exchange announcement. He will depart at the end of the year.

Interim results show the net asset value of the company’s listed and unlisted assets had risen £13m, or 6%, over the six months to the end of June, with its cash position reduced to £101m.

Prolonged uncertainty, volatile market conditions and depressed biotech valuations resulted in fewer new investments during the period with a continued focus on cash conservation, it said.

Peel Hunt analyst Miles Dixon praised Lyne’s management of the company during a challenging transition and backdrop, and noted the share’s implied discount to net asset value of 38% was too wide. He recommended ‘buy’ with a price target of 172p. 

The shares added 2.3p to 116.9p, valuing the company at £151m.

The £239m company announced a strategic review in July 2023 after the shares fell to a ‘significant’ discount to net asset value despite a healthy balance sheet, with the board noting the deficit had emerged during a sustained period of investor risk aversion. The shares currently trade at a 51% discount.

The board is considering its investment and realisation strategies, capital allocation and shareholder returns policies, as well as a tax-efficient wind-down. It will soon update shareholders, the largest of which is Acacia Research with a 25.5% position, according to Refinitiv.

The Nasdaq-listed company acquired its holding from Woodford, who was forced to sell a slew of biotech holdings from the Woodford Equity Income fund in a cut-price deal in June 2020 following the implosion of his firm in 2019. Woodford went on to advise Acacia on its portfolio.

Starboard Value, a US activist investor that owns 61% of Acacia, is understood to be seeking to maximise its returns given Arix’s yawning discount, The Times reported in July.

It added that Arix was frustrated by a lack of interest from investors and state backing in the UK, particularly at a time when the government and regulators were seeking to support listings and the life sciences sector.