Updated: HIGH-tech healthcare business Avacta expects to break even this year after four years of development.

Avacta, which makes drug testing equipment for the pharmaceutical industry, was set up in 2006 as a spin out from the University of Leeds. It was one of the first businesses to move into the York Science Park Biocentre.

Over the years it has invested in, and developed its flagship product Optim, a benchtop device which uses quick, laser-based analysis to select compounds of any new drug which are more likely to succeed, saving pharmaceutical companies millions of dollars. It now has sales partners in place around the world. Avacta is now about to launch AX-1, which is an immunoassay system which provides rapid animal blood-test results for vets, at the London Vet Show in November.

Dr Alastair Smith, chief executive, said that the business had made good progress through the past year and expected to break even in the third quarter of 2011. He said: “It has taken us four years to get to this point. We have grown from nothing to a £2.5 million turnover.”

The business announced in its preliminary results for the year ended July 31, 2011, that like-for-like revenues increased by 42 per cent to £2.45 million and it reduced its pre-tax losses from £2.03 million to £1.12 million.

The company is now going to develop the Optim product to increase its margins, Dr Smith said.

He said: “Avacta Analytical has now established a global network of high-quality distributors to accelerate the penetration of Optim into its target markets. This is working well and starting to reap substantial rewards.

“There is scope to improve the margins of both the Optim units and consumables and these development programmes are under way and on schedule to deliver benefits during 2012.”

The company moved to Thorp Arch, near Wetherby, earlier this year where it employs about 60 people. Dr Smith said the company was looking at recruiting two people in manufacturing, but the workforce would remain stable for six to 12 months.