RNS Number : 3454H

Schroder UK Public Private Tst plc

03 December 2020

Schroder UK Public Private Trust plc

Announcement of Net Asset Value as of 30 September 2020

Schroder UK Public Private Trust plc (the 'Company') today announces its net asset value ('NAV') as of 30 September 2020.


   --      NAV of 43.84p per share, a reduction of 3.5% (30 June 2020: 45.44p per share). 

-- NAV change driven by fluctuations in quoted holdings and foreign exchange rates ('FX'); valuation of unquoted holdings stable quarter on quarter.

-- Portfolio continues to be significantly weighted to healthcare companies, which have provided resilience over the first nine months of a turbulent year.

-- Schroders (the 'Portfolio Manager') continues to provide support to the businesses in the portfolio to help them navigate the current pandemic and to focus on adjusting position sizes towards a more balanced portfolio whilst reducing the debt.

   --      Net debt of GBP101.2 million, down GBP2.3 million from 30 June 2020. 


The outbreak of the COVID-19 pandemic in 2020 continues to have far-reaching implications for both public and private companies globally. The economic fallout has been felt across global markets with valuations gyrating from one quarter to the next. Q1 2020 saw a significant sell-off in equity markets as the world faced a highly uncertain outlook. Q2 2020 then saw a strong rebound due to the economic stimulus packages of central banks and confidence returned to the markets. After initially stabilising, many equity markets weakened again in Q3 2020 as economies around the world saw cases rising once again, leading to further restrictions being imposed, although less severe than had been seen previously.

Throughout this period the Portfolio Manager has continued to work closely with the portfolio companies to ensure appropriate actions have been taken by management teams, boards and investors, in a timely manner in order to reduce the impact of the pandemic as far as possible. This close interaction with the companies and their stakeholders has helped these businesses to manage their way through this unprecedented pandemic well, so far, but continued uncertainty remains.

The recent very positive news around several vaccines has created much cause for optimism. There is still likely to be a difficult period to navigate as businesses run low on reserves and continue to face trading restrictions, but the Portfolio Manager is confident that the portfolio is well positioned to withstand these pressures as the vaccines become available and some semblance of normality can return. It is important to note that very little of the portfolio is exposed to business models that depend directly on social mobility, physical retail activity, or office and high street real estate, areas which have arguably borne the brunt of the dislocation caused by national or regional lockdowns.

Whilst many companies in the portfolio have needed to adapt to mitigate the impact of COVID-19, several have benefitted, particularly in the healthcare space which remains the largest sector exposure for the portfolio accounting for 60% of total investments as of 30 September 2020. The Portfolio Managers believe that some of the changes to attitudes and behaviour seen during the pandemic are likely to prevail. As a result, they expect several of the portfolio holdings to be in a stronger position coming out of this pandemic than when they entered it.

Financial Performance

 Attribution Analysis             Quoted*   Unquoted   Net Debt   Other     NAV 
 Value at 30.06.20                  127.4      389.6    (103.5)   (0.7)   412.9 
                                 --------  ---------  ---------  ------  ------ 
 + Investments                          -        4.5      (4.5)       -       - 
                                 --------  ---------  ---------  ------  ------ 
 - Realisations at value            (6.2)      (0.2)        6.4       -       - 
                                 --------  ---------  ---------  ------  ------ 
 +/- Fair value gains/(losses)      (6.8)        0.2          -       -   (6.6) 
                                 --------  ---------  ---------  ------  ------ 
 +/- FX gains/(losses)              (1.0)      (5.6)          -       -   (6.6) 
                                 --------  ---------  ---------  ------  ------ 
 +/- Reclassified holdings            1.1      (1.1)          -       -       - 
                                 --------  ---------  ---------  ------  ------ 
 +/- Costs and other 
  movements                             -          -        0.4   (1.6)   (1.2) 
                                 --------  ---------  ---------  ------  ------ 
 Value at 30.09.20                  114.5      387.4    (101.2)   (2.3)   398.4 
                                 --------  ---------  ---------  ------  ------ 

Source: AIFM, Link Fund Solutions Limited, as of 30 September 2020. * Rutherford Health is reported as a quoted holding despite being fair value priced by Link Fund Solutions Limited, the Company's AIFM.

The NAV as of 30 September 2020 was GBP398.4 million or 43.84p per share. This reflects a decrease of 3.5% compared with the NAV as of 30 June 2020.

The contribution to the NAV total return of -3.5% can be broken down in to:

   --      Quoted holdings* -1.6% 
   --      Unquoted holdings 0.0% 
   --      FX impact -1.6% 
   --      Costs and other movements -0.3% 

During the quarter the Company's quoted holdings declined by 5.3%. The largest negative contributions to performance came from Autolus Therapeutics and Evofem Biosciences, with share price declines of 27% and 17% respectively. The likely explanation for Autolus' performance is the absence of material news flow until the December 2020 American Society of Hematology Conference, punctuated by a small uptick in reported adverse events within the company's ongoing clinical trials into a therapy for Diffuse Large B-cell Lymphoma. Evofem shares suffered from a large sale of shares by a director in early September. The largest positive contributor to performance was Idex Biometrics whose listed share price increased by 36%. This followed a series of positive announcements of commercial volume orders for its advanced fingerprint and authentication technology for use in next generation biometric payment cards. The company's technology proposition has also benefited from a global shift away from contact-based payment methods as a result of the COVID-19 pandemic.

The Company's unquoted holdings remained relatively stable, reflecting a subdued period of corporate activity with many companies pro-actively managing cash flows to see through the uncertainty.

During the period, the portfolio was also negatively impacted by appreciation in the value of sterling relative to the US dollar, Swiss Franc and Norwegian Krone which resulted in a depreciation of the value of the Company's foreign-denominated assets.

Investment Activity

The Company's investment activity during the period continued to mirror many of the themes referenced in the half year report. Within the public equity holdings, the Portfolio Manager moderately reduced various positions which were otherwise considered oversized relative to conviction levels. These realisations were used to meet more compelling opportunities to provide small amounts of funding for some of the private companies including Kymab, Cequr and Seedrs.

The Company acquired secondary shares in Kymab at a valuation which the Portfolio Manager deemed attractive and subsequently coincided with the announcement of positive Phase 2a data for the lead drug KY1005. The Company also exercised its option to invest into a convertible bridge loan in CeQur to support the portfolio company in the US commercial launch of its disruptive insulin delivery device, Simplicity. Finally, as mentioned in the half year report, the Company completed its last financial commitment^ related to follow-on funding agreed by the previous Portfolio Manager, a convertible investment in Seedrs. This was followed in October 2020 by the news that Seedrs intends to merge with Crowdcube to create the world's largest private equity marketplace. Further details regarding this transaction are included in the Company Updates section.

The Company also disposed of its shareholding in Ratesetter as part of the acquisition by Metro Bank, in return for a small upfront consideration, an in-specie distribution of RateSetter's holding in RateSetter Australia and a deferred consideration payable subject to the satisfaction of certain key performance criteria. The Company's new position in Ratesetter Australia, recently rebranded as Plenti Group, will henceforth be reported as a quoted holding as the shares are listed on the ASX market in Australia.

^ There is still one remaining tranche related to a similar commitment, the first tranche of which funded in the second quarter, which is expected to conclude over the next 6 months .

Top 10

The below table outlines the Company's top 10 holdings as of 30 September 2020 and 30 June 2020.

Portfolio Company       Value on 30 Sept      Value on 30       % of 30 Sept   % of 30 June 
                         2020 (GBP'000)    June 2020 (GBP'000)   2020 (Total    2020 (Total 
                                                                 investments)   investments) 
 Rutherford Health           80,811              80,811             16.1%          15.6% 
                        ----------------  --------------------  -------------  ------------- 
 Oxford Nanopore             68,707              68,707             13.7%          13.3% 
                        ----------------  --------------------  -------------  ------------- 
 Atom Bank                   56,772              56,772             11.3%          11.0% 
                        ----------------  --------------------  -------------  ------------- 
 Benevolent Al               33,507              33,507              6.7%           6.5% 
                        ----------------  --------------------  -------------  ------------- 
 Immunocore                  25,786              26,980              5.1%           5.2% 
                        ----------------  --------------------  -------------  ------------- 
 Inivata                     24,963              24,963              5.0%           4.8% 
                        ----------------  --------------------  -------------  ------------- 
 Carrick Therapeutics        18,171              18,533              3.6%           3.6% 
                        ----------------  --------------------  -------------  ------------- 
 Kymab                       17,961              16,971              3.6%           3.3% 
                        ----------------  --------------------  -------------  ------------- 
 Ombu                        14,024              14,024              2.8%           2.7% 
                        ----------------  --------------------  -------------  ------------- 
 Autolus Therapeutics        13,988              22,981              2.8%           4.4% 
                        ----------------  --------------------  -------------  ------------- 

Source: AIFM, Link Fund Solutions Limited, as of 30 September 2020. Value changes are reflective of a combination of valuation adjustments, FX movements, investments and realisations over the quarter.


The third quarter has been a period of stabilisation for the unquoted part of the portfolio as management teams navigate the pandemic and plan for a brighter future. The quoted holdings within the portfolio have seen further volatility as the public markets react, often sharply, to news flow and we expect these fluctuations to persist.

The Portfolio Manager will continue to focus on working with management teams to support decision-making in order to limit risks and seize opportunities that are presented during this crisis. Given current uncertainty, portfolio companies that are lacking visibility are being encouraged to concentrate on ensuring cash is preserved. At the same time, many companies in the portfolio continue to make strong operational headway. Where opportunities exist to expand and grow these are also being reviewed with a view to creating stronger businesses as the pandemic is brought under control.

Company Updates

Rutherford Health: Received conditional planning permission to construct a new diagnostics facility in Taunton

In September 2020, Rutherford Health announced that it had received conditional planning permission to construct a new diagnostics facility in Taunton, Somerset. As previously reported, Rutherford Diagnostics has entered into a partnership with Somerset NHS Foundation Trust to provide diagnostic services, which Rutherford Diagnostics will deliver from the new state-of-the-art facility in Taunton. The centre, located at the disused Zenith Fire Control Centre in Taunton, is expected to become operational in late 2021. Rutherford Health hopes to construct five diagnostics centres across the UK as part of an investment agreement with Equitix Limited, an investor, developer and long-term fund manager of core infrastructure assets in the UK and Europe.

The centre in Taunton will be the first such facility for Rutherford Diagnostics and will offer Computed Tomography, Magnetic Resonance Imaging, Ultrasound, X-Ray and other relevant diagnostic services. In addition to providing services to NHS patients via the initial five-year contract with Somerset NHS Foundation Trust, the centre will be available to private medical insurance and self-pay patients in the South West.

Oxford Nanopore: Partnered with UK Government to roll out LamPORE and raised GBP84m in new capital

In August 2020, Oxford Nanopore announced an agreement with the UK's Department of Health and Social Care, to roll out its novel LamPORE test. This will support the UK's efforts to manage the continued reduction of COVID-19 and containment of new cases, now and through the winter cold and flu season. Under the agreement, an initial 450,000 LamPORE SARS-CoV-2 tests will be made available for use by a number of NHS testing laboratories. As well as providing a large number of tests for existing labs, the programme will help the UK health service to understand the different use cases for the technology, for example the potential asymptomatic screening of frontline staff.

Because of its scalability, LamPORE has the potential to provide both large-scale screening to detect the virus in broader populations and rapid, focused, localised analysis. LamPORE is designed to be deployed on Oxford Nanopore's desktop device (GridION) or palm-sized device (MinION Mk1C), providing the capacity of processing up to 15,000 samples a day and 2,000 samples a day respectively. It is well suited to use in a central laboratory for high-throughput sample processing, or near-community 'pop-up labs'. LamPORE results can be generated in under two hours. The approach of having testing centres available in more locations combined with this speed supports rapid turnaround of results. Fast results can help precise isolation and therefore supports public health strategies to prevent onwards transmission of the virus.

In addition to a test for SARS-CoV-2, the virus that causes COVID-19, Oxford Nanopore is currently developing LamPORE to test for multiple pathogens within a single sample, including influenza A (H1N1 and H3N2), influenza B, respiratory syncytial virus ('RSV') and SARS-CoV-2. This is intended to allow healthcare professionals to distinguish between these infections, better manage expected winter pressures on the NHS and guide public health and clinical management of these diseases at a time of traditionally heightened pressure on health services. It also supports a goal of understanding dynamics between these viruses in the UK population.

Gordon Sanghera, CEO of Oxford Nanopore, said:

"We are honoured to be playing a part in fighting COVID-19 in the UK and preparing the country for the winter virus season. Ever since we founded Oxford Nanopore, our mission has been to create disruptive, high- performance technology that has a profound, positive impact on society. LamPORE has the potential to deliver a highly effective and, crucially, accessible global testing solution, not only for COVID-19 but for a range of other pathogens. We are delighted to be working with the UK government to support and empower our communities to effectively manage testing at a national and localised level."

Health Secretary Matt Hancock said:

"Oxford Nanopore's new rapid LamPORE tests will benefit thousands of people with fast and accurate test results, removing uncertainty and breaking chains of transmission quickly and safely.

I am hugely grateful for the fantastic work Oxford Nanopore have done to push forward this important innovation in coronavirus testing."

In October 2020, the company announced that it had raised GBP84m in new funding from existing and new investors, including International Holdings Company ('IHC'), RPMI Railpen and RT Puhua Genomics. The funds will support the rapid acceleration of Oxford Nanopore's commercial and manufacturing operations as well as ongoing innovation in the field of nanopore technology.

Atom Bank: Launched its new Instant Saver product

In September 2020, Atom Bank launched an Instant Saver, the first product to be launched on its state-of-the-art cloud-native banking platform. The product has none of the catches associated with most 'instant access' accounts, as customers can make deposits and withdrawals without penalty, 24 hours a day, seven days a week on savings from 1p up to as much as GBP100,000.

BenevolentAI: FDA grants Emergency Use Authorisation for baricitinib in hospitalised COVID-19 patients

In November 2020, BenevolentAI highlighted that baricitinib, a drug it first identified as a potential treatment for COVID-19, has been granted Emergency Use Authorization ('EUA') by the U.S. Food and Drug Administration ('FDA'). The rheumatoid arthritis drug, owned and marketed by Eli Lilly under the brand name Olumiant(TM), is now authorised for use in hospitalised COVID-19 patients who require supplemental oxygen or invasive mechanical ventilation.

This EUA decision was based on data from clinical updates released from the NIAID ACTT-2 trial and further validates the AI-derived hypothesis of baricitinib as a potential treatment for COVID-19, first published by BenevolentAI in The Lancet on February 4, 2020. The speed at which baricitinib entered clinical trials reflected the urgency of the pandemic and is testament to the strength of BenevolentAI's initial hypothesis. This action from the FDA for the EUA of baricitinib is an important milestone that has progressed at an unprecedented pace, moving from computer to bench to bedside in nine months.

Joanna Shields, CEO of BenevolentAI commented, "I am immensely proud that our research is playing a part in the global fight against COVID-19. The NIAID ACTT-2 trial data confirmed our initial hypothesis that baricitinib could be an effective treatment for hospitalised patients with COVID-19. With infection rates soaring, physicians will now have this valuable treatment in their armamentarium to combat the deadly virus."

The FDA grants Emergency use authorisation to provide availability of a medicine that may help diagnose, treat or prevent a life-threatening disease when no adequate and approved alternatives are available.

The ACTT-2 randomised control trial included more than 1,000 patients. It began on May 8 to assess the efficacy and safety of baricitinib plus remdesivir versus remdesivir alone in hospitalised patients with COVID-19 and was conducted in eight countries, including the UK. While it is not a material financial beneficiary, this is a great example of the embedded value of BenevolentAI's underlying technology.

Immunocore: Announced positive clinical results in a Phase 3 clinical trial of patients with previously untreated metastatic uveal melanoma

In November 2020, Immunocore announced that its Phase 3 IMCgp100-202 clinical trial of tebentafusp (IMCgp100) in metastatic uveal melanoma ('mUM') had met the primary endpoint for Overall Survival ('OS') in its first pre-planned interim analysis. The efficacy data confirmed the OS observed in the phase 2 study IMCgp100-102 in previously treated mUM which will be presented next month at the ESMO Immuno-Oncology Virtual Congress 2020.

Tebentafusp is a novel bispecific protein comprised of a soluble T cell receptor fused to an anti-CD3 immune-effector domain. It is engineered to specifically target gp100, a lineage antigen expressed in melanocytes and melanoma, and is the first molecule developed using Immunocore's ImmTAC technology platform designed to redirect and activate T cells to recognize and kill tumor cells. Tebentafusp has been granted Fast Track Designation by the FDA and has previously been granted orphan drug designation for uveal melanoma by the FDA and Promising Innovative Medicine designation under UK Early Access to Medicines Scheme.

"To our knowledge, this is the first survival benefit for any TCR therapeutic and for any bispecific in a solid tumor. The survival benefit observed in a randomized trial against checkpoint inhibitors validates our ImmTAC platform as we expand to study other cancers with high unmet need," said David Berman, Head of R&D; "Uveal melanoma has one of the lowest tumor mutational burdens (TMB) and these results suggest our ImmTAC platform should be evaluated in tumors with low or high TMB status."

The Phase 3 IMCgp100-202 clinical trial is designed to evaluate the OS of tebentafusp compared to investigator's choice (either dacarbazine, ipilimumab or pembrolizumab) in patients with previously untreated m UM. 378 patients were randomized in a 2:1 ratio to either tebentafusp or investigator's choice. Final results from IMCgp100-202 are expected to be presented at an upcoming scientific conference and to be submitted for publication in a peer-reviewed journal.

Autolus Therapeutics: Presented additional data on AUTO3 in DLBCL during the ESMO Virtual Congress 2020

In September 2020, Autolus Therapeutics announced new data highlighting progress on AUTO3, the company's CAR T cell therapy being investigated in the ALEXANDER study, a Phase 1/2 clinical trial in relapsed/refractory diffuse large B cell lymphoma ('DLBCL'), during the European Society for Medical Oncology ('ESMO') Virtual Congress 2020.

As of the data cut-off date of August 3, 2020, 35 patients in the ALEXANDER Phase 1/2 clinical trial of AUTO3 have been treated and were evaluable for safety. AUTO3 was well tolerated, with no Grade 3 or higher cytokine release syndrome ('CRS') with primary infusion and low rates of neurotoxicity ('NT'). Across all 35 patients, only three cases of NT have been reported, with two having >= Grade 3. None of the patients achieving a complete response ('CR') experienced any NT and all cases of NT reported have been atypical in nature and seen in a setting with disease progression and confounding factors. The company reported that the data supported a best-in-class profile with a high level of complete remissions and a well-tolerated safety profile.

Kymab: Included in the 2020 Sunday Times Sage Tech Track 100

In September 2020, following earlier positive Phase 2a results in its atopic dermatitis study, Kymab was included in the 2020 Sunday Times Sage Tech Track 100 which ranks Britain's 100 private tech companies with the fastest-growing sales over their latest three years.

Reaction Engines: Released details of its innovative new battery thermal management system for electric vehicles ('EVs')

In November 2020, Reaction Engines Applied Technologies released details of its innovative new battery thermal management system for EVs, the hxLIFE Foils - a brand new battery thermal management system which is targeted at revolutionising the EV market and accelerating the uptake of electric cars through a range of significant performance benefits.

The company believes its technology represents a step change in thermal management for EVs powered by Lithium-Ion batteries which are highly impacted by temperature. From charge and discharge rates, health and capacity to overall lifespan, a robust battery thermal management system is key to the overall performance of EVs. Reaction Engines has developed a battery thermal management system ('BTMS') unlike anything currently available; hxLIFE Foils are conformable guard foils which sit between battery cells and create isothermal performance across the entire battery pack. The foils are very flexible which allows them to be retrofitted into existing systems. They can be inserted into any existing EV battery pack without the need for a complex system redesign. A lightweight construction enables the increase of energy density across battery cell as opposed to more conventional, heavier systems.

This is just one example of how Reaction Engines Applied Technologies is adapting its thermal management technology developed under the SABRE programme for commercial sectors.

Seedrs: Announced plans to merge with Crowdcube

On Monday 5 (th) October 2020, Crowdcube and Seedrs announced that they had agreed terms for a merger, in a move that will accelerate their plans to create the world's largest private equity marketplace and further democratise investment. By joining forces, the ambition is that thousands of ambitious, fast-growth businesses and millions of investors will be able to benefit from the best expertise, services and returns offered by Crowdcube's and Seedrs' investment platforms.

On completion, Jeff Kelisky, Seedrs' CEO, will serve as CEO of the combined company, and Darren Westlake, Crowdcube's CEO and co-founder, will serve as Executive Chairman. The management team will include key leaders from both businesses. The combined company aims to deliver new innovations and products that will make it significantly easier, more affordable and valuable for ambitious businesses to raise growth finance, and for investors to have an even greater selection of investment opportunities with richer investment tools.

The transaction is subject to approval by, among others, the UK Competition and Markets Authority ('CMA'), the Financial Conduct Authority ('FCA') and shareholders of the two companies as well as the sanction of the Court. The transaction is expected to be completed in early 2021.

AMO Pharma: Granted Rare Pediatric Disease designation for AMO-02

In November 2020, AMO Pharma, a privately held biopharmaceutical company focusing on rare, childhood onset neurogenetic disorders with limited or no treatment options, announced that the FDA had granted a Rare Pediatric Disease ('RPD') designation for AMO-02, the company's investigational therapy in development for the treatment of congenital myotonic dystrophy.

The FDA grants RPD designation for serious and life-threatening diseases that primarily affect children aged 18 years or younger and fewer than 200,000 people in the United States. The designation qualifies AMO Pharma to receive fast track review for AMO-02 and a priority review voucher ('PRV') at time of marketing approval. PRVs are transferable and can be used by drug developers to earn an expedited six-month review of a new drug application by the FDA.

"This Rare Pediatric Disease designation highlights the significant need for a treatment for congenital myotonic dystrophy and adds additional momentum to our development program," said Ibraheem Mahmood, CEO of AMO Pharma. "The option of monetizing a PRV voucher also represents a significant opportunity to support our mission to develop novel medicines for children with developmental disorders."

The AMO-02 clinical trial is a double-blind, placebo controlled, randomized study in children and adolescents with congenital onset myotonic dystrophy intended to support a future submission for marketing authorization in congenital myotonic dystrophy. The trial is being conducted at eleven treatment centres globally and plans to enrol a total of 56 patients who will be assessed on a range of measures of central nervous system ('CNS') features and muscle function associated with congenital myotonic dystrophy.

IDEX Biosciences: Reported multiple volume production orders and filed registration statement for dual listing on Nasdaq

During the quarter, IDEX Biometrics began shipments of its TrustedBioTM family of products and solutions, for advanced fingerprint and authentication use in next generation biometric payment cards. The company announced it had received its first commercial and volume order from a Tier 1 global card manufacturer for TrustedBioTM biometric fingerprint sensors, as well as a sizeable order from European biometric fintech company, ZWIPE.

Also, during the quarter, IDEX announced volume orders from Hengbao, one of the largest smart card companies based in China, as well as a strategic partnership with South Korea-based global smart card and software manufacturer, Ubivelox, to service the Asia Pacific region beyond China, with shipping to card integrators planned in the first quarter of 2021.

Shortly after the end of the quarter, IDEX filed a registration statement with the U.S. Securities and Exchange Commission for a dual listing on Nasdaq.

Mereo Biopharma: Announced initiation of a Phase 1b/2 clinical trial with Alvelestat in COVID-19 respiratory disease, received FDA Rare Pediatric Disease Designation for Setrusumab and clearance to proceed into a Phase 1b/2 study for Etigilimab

In August 2020, Mereo BioPharma announced the initiation of a Phase 1b/2 placebo-controlled clinical trial to evaluate the safety and efficacy of alvelestat in hospitalized, adult patients with moderate to severe COVID-19 respiratory disease. Alvelestat is a novel, oral small molecule designed to inhibit neutrophil elastase ('NE'), a key enzyme involved in the destruction of lung tissue. Alvelestat is already being investigated by Mereo in a Phase 2 proof-of-concept clinical trial in patients with alpha-1 antitrypsin deficiency ('AATD').

The Phase 1b/2 trial related to COVID-19 will be conducted at the University of Alabama. Approximately 15 patients will be randomized (2:1) to receive either alvelestat plus standard of care or placebo plus standard of care for 10 days. The primary endpoint of the trial is safety and tolerability of alvelestat at day 10, with a safety follow-up to day 90. Additional endpoints include blood biomarkers (NETosis, inflammation and hypercoagulation) and oxygen deficit (as measured by the ratio of oxygen saturation to the fraction of inspired oxygen, SaO2/FiO2) at day 10. The trial will also assess clinical outcomes, including effect on disease progression measured by need for respiratory support and disease severity using the WHO 9-point ordinal scale at day 29.

In September, the FDA then granted Rare Pediatric Disease designation to setrusumab for the treatment of osteogenesis imperfecta ('OI'). Setrusumab is a fully humanized monoclonal antibody that inhibits sclerostin, a protein which inhibits the activity of bone-forming cells. OI is a genetic rare disorder with no approved treatments that is characterized by reduced bone mass and fragile bones that break easily. In Mereo's Phase 2b ASTEROID study, setrusumab demonstrated a dose-dependent bone building effect and a trend of reduction in fractures in addition to being safe and well tolerated in adults with OI.

The FDA grants Rare Pediatric Disease Designation for serious and life-threatening diseases that primarily affect children aged 18 years or younger and fewer than 200,000 people in the United States. If a Biologics License Application ('BLA') in the United States for setrusumab is approved, Mereo may be eligible to receive a priority review voucher from the FDA, which can be redeemed to obtain priority review for any subsequent marketing application and may be sold or transferred to other companies for their programs, as has been done by other voucher recipients.

Finally, in October 2020, the FDA cleared the company's investigational new drug application to proceed with a Phase 1b/2 study for the lead oncology product candidate etigilimab. Etigilimab is a novel IgG1 monoclonal antibody against TIGIT, a next generation checkpoint receptor shown to block T-cell activation and the body's natural anti-cancer immune response.

American Financial Exchange: Welcomed its 200(th) Member and highlighted the first AMERIBOR-linked debt offering

In August 2020, American Financial Exchange ('AFX'), an electronic exchange for direct lending and borrowing for American banks and financial institutions, announced that Citizens Bank, N.A. of Providence, Rhode Island, joined the AFX, marking the exchange's 200th institution to become a member since its inception in 2015. AFX membership is up 30 percent from a count of 154 from August 1, 2019.

In October 2020, AFX also highlighted news of the first AMERIBOR-linked debt offering, a deal by Signature Bank (Nasdaq: SBNY) with $375m of fixed-to-floating rate subordinated notes due in 2030. The notes will bear interest at 4% per annum, payable semi-annually. For the floating component, interest on the notes will accrue at three-month AMERIBOR plus 389 basis points

"We are pleased to be the first institution to use AMERIBOR on a debt issuance. We are founders and early supporters of AFX. AMERIBOR is transparent, self-regulated and transaction- based, and we believe that it is already a suitable alternative as banks and other financial institutions transition away from LIBOR," said Scott Shay, Chairman of the Board at Signature Bank.

"The first use of AMERIBOR in a debt offering marks a landmark moment for the Exchange and its members. This will pave the way for more debt deals and other types of financial products linked to the AMERIBOR benchmark, providing greater choice to all market participants. We applaud Signature Bank for their leadership role," said Dr. Richard L. Sandor, chairman and founder of the AFX.

AFX membership across the U.S. now includes 161 banks, 1,000 correspondent banks and 43 non-banks, which is comprised of insurance companies, broker-dealers, private equity firms, hedge funds, futures commission merchants, and asset managers. Member institutions have more than $3 trillion in assets.

Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. The securities shown above are for illustrative purposes only and are not to be considered a recommendation to buy or sell.


Schroder Investment Management Limited

 Gareth Faith (Company Secretary)    0207 658 5264 
 Estelle Bibby (Press)               0207 658 3431 

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