The company said the rise was partly offset by cost savings following a restructuring programme in early 2009.

It announced plans to raise £25.2m gross to fund a new Phase II study of Cogane via a placing and open offer.

Phytopharm said it believes Cogane has blockbuster potential 'as recent trial results have been compelling and Cogane potentially addresses a large and as of yet unmet medical need'.

In addition, Phytopharm has preclinical programmes in development for asthma, chronic obstructive pulmonary disease and vascular dementia.

During the year, the group signed a mutual termination agreement with Unilever resulting in a reduction in revenue. The company reported revenue of £0.87m for the year, down from the previous £2.62m.

Revenue was principally generated from agreements with Unilever in respect of the development of Hoodia extract, Schering-Plough in respect of sales of the veterinary product Phytopica and from the sale of raw materials from inventory.

Development costs fell to £3.91m from £4.25m, reflecting reduced expenditure on the Hoodia extract programmes following termination arrangements with Unilever, offset by the increase in expenditure incurred on Cogane studies.

Pre-tax loss on ordinary activities increased to £4.21m from £2.48m.

Phytopharm said the interim management team appointed in late 2008 has driven forward implementation of its business review and was currently focused on securing resources to take forward the company's strategy.

'Once these resources are in place we intend to strengthen our executive team with the recruitment of a permanent CEO and a research and development director.'

Story provided by Business Financial Newswire