(Reuters) -Spanish pharmaceutical group PharmaMar on Thursday said its nine-month net profit slipped 58% to 54.7 million euros ($63.92 million) from a year ago when it booked a hefty gain from a licence payment.

PharmaMar, which develops marine-inspired oncology drugs, said recurring revenue rose 31% to 119.4 million euros over the period, helped by the demand for its cancer treatments. It booked the 181 million euro upfront licence payment in the first half of last year.

The company’s oncology sales surged 21% from a year earlier to 88.7 million euros, boosted by steady performance of its ovarian cancer drug Yondelis, as well as a 78% increase in European sales of Zepzelca, its lung-cancer drug.

Royalty revenues reached 27.2 million euros in the January-June period, up from 7.4 million euros a year ago, mainly supported by Zepzelca sales in the U.S. by partner Jazz Pharmaceuticals.

Sales in PharmaMar’s smaller diagnostics division shrank by 67%, hit by lower demand and a drastic decline in the price of PCR, antigen and antibody COVID-19 tests, the company said.

Group R&D spending increased by 21.2% over the nine months.

PharmaMar invested a further 4.5 million euros on clinical trials to use its Aplidin drug, initially developed to treat a type of bone-marrow cancer, as a COVID-19 treatment in the third quarter.

($1 = 0.8558 euros)

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