The company behind Dolly the sheep and the five cloned piglets, PPL Therapeutics, has reported annual losses of £14.4 million.

The figure was almost identical to last year's loss. The group has kept up its research and development spending aimed at creating organs for transplant operations.

PPL, which last month cloned the five piglets, Millie, Christa, Alexis, Carrel and Dotcom, is working towards producing pig-to-man transplants and solving the worldwide shortage of human organs.

It said the potential market for the product was estimated at around £3.8 billion) a year. But research and development costs of £13.5 million saw pre-tax losses stand virtually unchanged at £14.4 million for the year to December 31. Turnover was marginally up at £490,000, against £478,000 last time.

Edinburgh-based PPL said the year had been a "challenging" one in which much of the groundwork was now paying off. It had gained three sets of positive clinical trial results and had secured funding for a production plant. The group had also spent £500,000 restructuring the business in November, which involved a cut in staff to 160.

Dr Ron James, managing director said: "This has been another year of continued development for the company. There have been a number of positive trial results and with the restructuring now complete and the funding for the production plant in place, PPL is well placed to capitalise on theses successes."

Dr James said organ development research had accounted for around ten per cent of of the research and development spending during the year. "We are looking at ways of getting extra funding into the project," Dr James said.

The group is talking to venture capital companies about further financing for the pig-to-human transplant research.

Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.