TIDMEVG
RNS Number : 8603B
Evgen Pharma PLC
07 June 2023
Evgen Pharma plc
(the "Company")
Full year Results
7 June 2023 - Evgen Pharma plc (AIM: EVG), the clinical stage
drug development company developing sulforaphane-based medicines
for the treatment of multiple diseases, announces its audited
results for the year ended 31 March 2023.
Operational summary
-- Substantial out-licensing deal signed with STALICLA SA for neurodevelopmental disorders and schizophrenia with total milestones of $160.5m, double digit royalties
o $0.5m milestone payment received from STALICLA
o Up to $5.5m in further milestones expected within 2024
-- Phase I/Ib healthy volunteer study of new SFX-01 formulation
completed during the financial year:
o Positive safety and pharmacokinetic read out announced on 22
March 2023
o No serious adverse events, total drug and active metabolites
detected in the range seen in lab experiments which show
significant activity in vitro
-- First phase of glioblastoma trial expected to commence in
2024 and to be conducted as an Investigator Sponsored Study at the
Erasmus University Medical Centre, Rotterdam
-- Grant applications submitted to Netherlands authorities to
fund glioblastoma pre-clinical and clinical work and positive
regulatory advice received to date regarding the trial
-- Further progress with the University of Manchester
collaboration investigating potential use of SFX-01 in breast
cancer patients with resistance to CDK4/6 inhibitors
-- Continued collaboration with University La Sapienza di Roma
on potential radio-sensitisation properties of SFX-01
-- Emerging evidence of radio-sensitisation demonstrated for
SFX-01 in vitro, as published at ESMO rare diseases conference,
March 2023
-- Continued collaboration with University of Michigan, to
investigate the potential anti-tumour effects of SFX-01 in
colorectal cancer
-- CFO, Richard Moulson, to retire at AGM in late July. Search for replacement well underway
Outlook
-- Clinical trials in Autism Spectrum Disorder and Glioblastoma
scheduled to commence by partners within the next twelve months
-- Full data set from Phase I/Ib healthy volunteer study available in Q2/Q3 2023
-- Data from breast cancer, colorectal cancer and
radio-sensitisation pre-clinical work expected by end of 2023
-- Further milestones from STALICLA collaboration expected
during the year with up to $5.5m anticipated by 31 December
2024
Financial highlights
-- Financial performance in-line with expectations:
o Post tax loss of GBP4.0m (2022: loss of GBP2.7m)
o Cash outflow from operations of GBP4.1m (2022: outflow of
GBP2.6m)
o Cash and short-term investments and cash on deposit at 31
March 2023 of GBP5.0m
(31 March 2022: GBP9.0m)
Dr Huw Jones, CEO of Evgen Pharma, said:
"The last year has seen substantial progress in both our science
and in our stated aim of out-licensing our technology in
cash-generating partnerships . Of particular note is our
partnership with STALICLA in Autism Spectrum Disorder that could
generate substantial non-dilutive income over a long period.
Our new commercial scale formulation of SFX-01 has performed
well in our Phase 1b healthy volunteer study, showing release
commensurate with the enteric coat, absence of SAEs and total
active and active metabolite levels in the range seen in vitro
where substantial biological activity was observed.
In our pre-clinical collaborations, we were pleased to see
evidence of radio-sensitisation by SFX-01 in a further tumour type
(rhabdomyosarcoma), complementing results seen previously in models
of glioblastoma. The coming year promises even more evaluation of
SFX-01 in the clinic and the receipt of substantial milestone
payments, positioning us well to continue to progress our
programmes at all levels.
On a personal note, I would like to express my sincere thanks to
our CFO Richard who is retiring at the AGM. His steadfast support
and well considered judgements have been invaluable both to the
Company and to me personally. I wish him and his family the very
best as they enjoy considerably more leisure time that will no
doubt fill up very quickly."
Enquiries:
Evgen Pharma plc Tel: +44 207 457 2020
Dr Huw Jones, CEO enquiries@evgen.com
Richard Moulson, CFO
FinnCap (Nominated Advisor and Broker) Tel: +44 20 7220 0500
Geoff Nash / Teddy Whiley (Corporate
Finance)
Alice Lane / Nigel Birks (ECM)
Instinctif Partners Tel: +44 207 457 2020
Melanie Toyne-Sewell / Rozi Morris / evgen@instinctif.com
Adam Loudon
Notes to Editors
About Evgen Pharma plc
Evgen Pharma is a clinical stage drug development company
developing sulforaphane based medicines for the treatment of
multiple diseases. The Company's core technology is Sulforadex(R),
a method for synthesising and stabilising the highly biologically
active compound sulforaphane and novel proprietary analogues based
on sulforaphane.
The Company's lead asset, SFX-01, is a patented composition of
synthetic sulforaphane and alpha-cyclodextrin and has undergone
clinical trials for oestrogen-positive (ER+) metastatic breast
cancer and recently a Phase 1b study of the Company's new enteric
coated tablet formulation. The FDA has granted Orphan Drug status
to SFX-01 in malignant glioma. SFX-01 will be investigated
initially in this indication as an investigator sponsored study in
the Netherlands.
The Company also has a wide number of collaborations with
leading academic centres in the UK, Europe and the US as part of
the continuing strategy to build the scientific data for the
compound. With respect to areas outside of oncology and
inflammation, Evgen signed an out-licensing deal with JuvLife, the
dietary products and functional foods division of Juvenescence Ltd,
for the development of a naturally-sourced sulforaphane nutritional
health supplement, stabilised using Evgen's Sulforadex(R)
technology. More recently Evgen completed an out-licensing
transaction with Stalicla SA, a Swiss specialist company in
neurodevelopmental disorders, commencing with autism spectrum
disorder. The deal, if successful, will generate milestone payments
of $160.5m and a double-digit royalty on sales.
The Company has its headquarters and registered office at
Alderley Park, Cheshire. It is listed on AIM in London and trades
under the ticker symbol EVG.
For further information, please visit: www.evgen.com
STRATEGIC REPORT
CHAIRMAN'S STATEMENT
The most significant achievements in the last year were the
substantial out-licensing deal with STALICLA, creating an
opportunity for the use of SFX-01 in autism spectrum disorder
(ASD), and clinical completion of the Phase Ib human volunteer
trial on schedule.
Strategy update
The aim for the financial year was to drive the progress of the
clinical programmes, whilst building further value through
additional partnering and scientific collaborations.
Academic collaborations have made good progress during the
period with encouraging data, particularly in breast cancer and
radio-sensitisation.
The clinical stage of the healthy volunteer
pharmacokinetic/pharmacodynamic ("PK/PD") study of the new SFX-01
formulation was completed to plan, and analysis of the data is
progressing well. To date, the analyses have shown timely
absorption of sulforaphane into the body (pharmacokinetics) as well
as further evidence of SFX-01's strong safety and tolerance
profile.
On the advice of key opinion leaders, additional pre-clinical
work and an early-stage clinical trial of SFX-01 in patients with
glioblastoma ('GBM') will be conducted to generate more data on how
SFX-01 enters the brain tumour tissue and interacts with molecular
targets. This early clinical work should further de-risk the Phase
II clinical trial, as well as extending the cash runway since the
trial will be run as an investigator sponsored study (ISS).
The ongoing scale-up and production of the new formulation of
SFX-01 to GMP standards has been a major focus of activity, and is
a key development which will be important for future clinical
studies conducted by Evgen and its partners. This project has and
continues to generate considerable know-how in the scale up of
synthetic sulforaphane.
Work in our collaboration with STALICLA has commenced; we are
supporting product supply and regulatory requirements for their
clinical programmes of SFX-01.
Conclusion
The very substantial out-licensing deal, announced in October
2022, extends the application of SFX-01 into neurodevelopmental
disorders and underpins the potential of the lead compound beyond
oncology and inflammation. This reduces the Company's risk profile,
and the non-dilutive upfront payments and initial milestones may
also significantly extend the Company's cash runway, leaving it
well positioned to execute further on its growth strategy.
The Board looks forward to continuing to progress its strategy
which remains clearly focused on commercialising the considerable
potential of SFX-01.
Barry Clare
Chairman
CHIEF EXECUTIVE'S REVIEW OF PERFORMANCE
We are pleased with the progress made operationally and
strategically in the past year, including starting and finishing a
clinical trial and signing a substantial out-licensing deal.
We have focused on pre-clinical projects, scale-up of
manufacturing, business development and conducting the PK/PD Phase
Ib human volunteer trial. In particular, two new pre-clinical
programmes were commenced, PK/PD data is currently being analysed
from the Phase Ib trial and we are actively supporting the ASD
programme for STALICLA's proposed Phase II clinical trial in ASD
patients. More details are described below.
Looking forward, the GBM clinical trial is expected to commence
in 2024, subject to grant funding. The goal is to generate
sufficiently compelling efficacy data to allow partnering of the
programme and progress into a registration study(ies). Equally, the
pre-clinical work in metastatic breast cancer ('mBC') is designed
to attract a partner to support the next clinical development in
this indication. At the same time, we will continue seeking new
partnerships and collaborations.
CLINICAL STAGE PROGRAMMES
Glioma/glioblastoma
Glioma is the most common form of brain tumour affecting around
5 per 100,000 people. The more severe, grade IV classification,
glioblastoma, is a very serious form of malignant brain tumour
representing 45% of all cases and has a poor prognosis, with median
survival of around 14 months. The five-year survival of the severe
grades is 5%. Therapeutic options for glioma are limited to
surgery, radiotherapy and the one drug widely available,
temozolomide. There is a clear unmet need for more treatments for
use in conjunction with the current standard of care.
Evgen has consulted widely with world-renowned experts in the
treatment of brain cancers with regards to the planned study. These
key opinion leaders have advised that further pre-clinical work and
an early-stage clinical trial of SFX-01 in patients with GBM should
be conducted, to acquire more clarity on sulforaphane entering the
brain tumour tissue and its interaction with molecular targets in
the tumour tissue of GBM patients. The Company expects that this
approach will further de-risk the Phase II clinical trial and
facilitate earlier partnering discussions.
This preliminary clinical work will be conducted as an
Investigator Sponsored Study ('ISS'), led by Dr Marjolein Geurts,
neuro-oncologist at the Erasmus University Medical Centre, the
Netherlands . The Erasmus group has extensive experience in
glioblastoma research, with several studies and numerous
publications in this field. Evgen has already received positive and
supportive regulatory scientific advice from the Dutch Medicines
Evaluation Board, which also stated that there are no specific
concerns related to the clinical safety profile of SFX-01 based on
available data.
Grant applications to fund the study have been made and the
result is anticipated during H2. The clinical trial would then be
expected to commence in 2024. If the pre-clinical and ISS clinical
work is successful, the trial programme is likely to be continued
as an Evgen-sponsored trial.
Metastatic breast cancer
Breast cancer remains the biggest cause of cancer deaths in
women worldwide, and ER+ve/HER2-ve breast cancer accounts for circa
two thirds of all such cancers. The drugs used increasingly in
first line treatment of ER+ve/HER2-ve mBC patients, being CDK4/6
inhibitors, which since first approved for general use in the US in
2017, now have global sales in excess of $5 billion per annum.
Since the completion of our positive phase IIa trial of SFX-01
in metastatic breast cancer conducted in 2016 to 2019, CDK4/6
inhibitors have grown in acceptance and are becoming standard of
care in first line mBC treatment. These drugs provide an extended
period of progression free survival, but invariably patients become
resistant to them. Accordingly, Evgen is conducting further
pre-clinical work with its collaborators at the University of
Manchester's Manchester Breast Centre to assess the impact of
SFX-01 in CDK4/6 resistance models. To date this work has
demonstrated encouraging in vitro data. A number of experiments are
ongoing in different CDK4/6 resistant mBC pre-clinical models,
particularly in relation to the reduction of pSTAT3, believed to
have an important role in a number of cancers. Data is expected
from these experiments in Q2 and Q3 2023.
Our objective from the extended collaboration with the
Manchester team is to generate sufficient in vitro and in vivo
models to provide the optimum support for clinical trial design
and/or licensing in patients with ER+ve/HER2-ve breast cancer,
where CDK4/6 inhibitors such as palbociclib are showing reducing
effectiveness.
Phase I/Ib Human volunteer study
An important use of proceeds from the fundraise completed in
March 2021 was to conduct a Phase I/Ib study in healthy volunteers
of our new SFX-01 formulation. The trial comprised three cohorts of
8 volunteers each, of which two in each cohort received a placebo.
The trial was randomised and double-blinded.
The first volunteers for the trial were recruited in October
2022 and all participants had received their final dose on schedule
by the end of January 2023. Analysis of the pharmacokinetic (PK)
data is complete and the analysis of the pharmacodynamic (PD) data
will be completed in Q2/Q3.
The PK data show reliable absorption of sulforaphane at a time
scale consistent with the objective for the new formulation. They
also show release in the small intestine and protection by the
enteric coat on the tablet and the reliable conversion in the body
to active metabolites. The total sulforaphane and active metabolite
levels were found at concentrations that, in the test tube, are
responsible for profound biological activity. Analysis of PD data
is ongoing and a full data set is expected to be completed in Q2/Q3
2023.
PRE-CLINICAL PROGRAMMES
We continue to support academic research to broaden the
potential range of applications for SFX-01 and increase our
mechanistic understanding in various disease areas of high unmet
medical need.
Università Sapienza di Roma
Based on previous findings from pre-clinical work in glioma, in
May 2022 Evgen commenced a collaboration with Prof. Francesco
Marampon, of Università Sapienza di Roma to investigate the
hypothesis that SFX-01 could enhance the action of radiotherapy in
cancer patients. The scientific work evaluated the anti-tumour
activity of SFX-01 in two preclinical cellular models of
rhabdomyosarcoma (RMS) tumours, the most frequent soft tissue
sarcoma in childhood. This disease is mostly diagnosed in children
under 10 years old.
The in vitro data showed that SFX-01 reduced tumour cell growth
by inducing G2 cell cycle arrest and triggering early-apoptosis
(cell death). In addition, SFX-01 was shown to be effective both as
a single agent and in combination with radiotherapy where it was
found to be synergistic; it created a more positive outcome than
would be expected by simply adding the two agents together.
The results also showed that SFX-01 was able to reduce tumour
cell growth in clinically relevant radioresistant RMS cells,
substantially inhibiting the formation of cancer stem cell-derived
tumourspheres (rabdospheres). The results were presented in a
poster at the ESMO Sarcoma and Rare Cancers Congress (March, 2023),
in Lugano Switzerland.
Prof. Marampon is now extending the work to in vivo models, the
results of which are likely to be available in the third quarter of
2023.
University of Michigan
A further collaboration commenced in June 2022 with Dr Grace
Chen of the University of Michigan to investigate the potential
anti-tumour effects of SFX-01 in colorectal cancer. Specifically,
the collaboration seeks to evaluate the in vivo effects of SFX-01
in models of colorectal cancer. The activity and mechanism of
action of SFX-01 on organoid growth, morphology, stemness and
inflammatory markers will also be investigated using normal and
malignant patient-derived organoids and tumour tissue. Initial
results are expected at the end of 2023.
Colorectal cancer is considered to be the third most common form
of cancer worldwide, with between 1.5-2 million annual diagnoses,
and the second leading cause of cancer-related deaths. There has
also been an alarming global rise in early-onset colorectal cancer
occurring in individuals under 50 years of age. Treating colorectal
cancers can be difficult and does not always lead to a cure
especially in advanced stages. Therefore, there is a strong need to
develop chemoprevention strategies as well as better treatment
options.
OUTLICENSING
STALICLA partnership
In October 2022, the Company licensed the global rights for lead
asset SFX-01 in neurodevelopmental disorders and schizophrenia to
STALICLA , a Swiss company specialising in the identification of
specific phenotypes of ASD, using its proprietary precision
medicine platform. Evgen retains the global rights for all other
indications.
The financial terms include a signing fee of $0.5m to acquire
the license and $0.5m on completion of the human volunteer Phase
1/1b study (anticipated during Q2 2023); the latter will provide
data to support STALICLA'S clinical trials and both will contribute
to the costs of supplying SFX-01 for these trials. Thereafter,
milestone payments that reflect progress by STALICLA in their
development programme up to commercial launch amount to $26.5m,
including $5m on grant of IND by the FDA (anticipated by the end of
2024. Total milestones of up to $160.5m are payable. Royalties
payable to Evgen on sales are in the low to medium double-digit
range in all scenarios, including on-licensing by STALICLA and use
of SFX-01 in further licensed indications.
Previous studies with other sources of sulforaphane have shown
evidence of clinical efficacy in improving symptoms of ASD (e.g.,
Singh et al 2014). However, patient heterogeneity provides a
challenge in identifying those individuals likely to respond to
therapy. STALICLA has a unique, proprietary technology to identify
ASD patients who are most likely to respond to SFX-01. This
screening approach has already been used successfully to identify
ideal patients for other ASD drug trials and is a key
differentiator for STALICLA in developing drugs for such a wide
spectrum disorder as ASD.
Our collaboration with STALICLA has commenced well ; we are
supporting product supply and regulatory requirements for their
clinical programmes of SFX-01 and liaising on a regular basis. The
partnership will enable the targeting of patient groups most likely
to benefit from SFX-01, not only de-risking the clinical
development but potentially bringing a therapeutic option to those
individuals who are currently underserved, in a quick and efficient
manner.
Juvenescence partnership
The partnership with Juvenescence continues to make progress and
Evgen is supporting its development with the know-how and expertise
we have in making sulforaphane-based compounds for human use. It is
envisaged that product launch will occur in around two years' time
at which point milestone payments of over GBP1m will have been
received.
MANUFACTURING PROGRAMME
Following a competitive process, a new supplier of the key
intermediate material for the synthesis of SFX-01 was contracted.
The new manufacturer has extensive facilities and capabilities.
Circa 25kg of product has been successfully manufactured in good
time and at a competitive price. A further 25kg is expected in H2.
This will be sufficient for clinical requirements in the
foreseeable future.
Contracts have been signed for the manufacture of active drug
and placebo for the forthcoming STALICLA Phase II trial and the
glioblastoma Investigator Sponsored Study. This production will
take place in Q2-Q4 of the current year.
Further work has been directed at understanding the nuances of
synthesising SFX-01. The stabilisation process is complex and not
easily understood at the molecular level. Accordingly, our
extensive amount of know-how generated by this project provides a
high barrier to competition and augments our patent estate.
PEOPLE
Richard Moulson, CFO, has decided to retire from executive roles
and accordingly has resigned from Evgen after over 6 years of
service. He will leave following the AGM on 20 July 2023. A search
for a replacement is ongoing through an executive search company
with promising candidates undergoing second interviews. Interim
arrangements are in place should an appointment not be made until
after the AGM.
OUTLOOK
Since the 2021 fundraise we have achieved a number of key
clinical, operational and commercial milestones that should lead to
the commencement of two clinical trials around the end of the
calendar year, with the generation of data from 2024. Potentially
we will also have pre-clinical data sets to support further our
breast cancer programme and which may point to trials in other
indications such as radio-sensitisation in brain cancer, and others
where radiotherapy is the mainstay of treatment.
Our partner Juvenescence is progressing well towards market
launch within the next two years and our more recent partner
STALICLA is making good progress on clinical trial design in ASD,
which will generate further milestones. Both partnerships will
provide milestones and commercial revenues to defray a material
part of our cost base. In the meantime, we will be advancing
preclinical studies and our business development strategy.
I would like to thank our shareholders for their continued
support and to the team for their efforts in driving the strategy
forward. We believe the next 12 months will be extremely busy and
that we will build further value through R&D and our
substantial commercial partnerships.
In closing I would like to thank Richard Moulson for his
personal support of the Company and myself, from my smooth
transition into the organisation and the constant and steadfast
support for the Company and myself on a daily basis.
Dr Huw Jones
Chief Executive Officer
KEY PERFORMANCE INDICATORS
Key Performance Indicators include a range of financial and
other measures (such as clinical trial progress). Details about the
progress of our development programmes (non-financial measures) are
included elsewhere in this Strategic Report, and below are the
other indicators (financial measures) considered pertinent to the
business.
2023
(GBPm)
Year-end cash, short-term investments and cash
held on deposit: (2022: GBP9.0m) 5.0
--------
The decrease in year-end cash reflects corporate costs, and in
particular the extensive manufacturing work and execution of the
Phase I/Ib clinical trial, less receipt of the R&D tax credit
(GBP0.48m). There was no fundraising activity in the year.
2023
(GBPm)
Net cash outflow from operating activities
(before monies placed on
fixed term deposits): (2022: GBP2.6m) 4.1
--------
The net cash outflow reflects corporate costs and the costs
incurred in manufacturing scale up, pre-clinical and clinical
expenditures.
2023
(GBPm)
Operating loss: (2022: GBP3.2m) 5.1
--------
The increase in operating loss compared with 2022 reflects
escalation of manufacturing activity and commencement and
completion of the clinical work in the Phase I/Ib trial, less
GBP442k in revenue from the Stalicla deal.
Financial Review
The financial performance for the year ended 31 March 2023 was
in line with expectations.
Losses
The total loss for the year was GBP4.0m (31 March 2022: GBP2.7m)
including a charge for share-based compensation of GBP0.2m (2022:
GBP0.1m). Operating expenses excluding share-based compensation
were higher than in 2022 at GBP5.4m (2022: GBP3.0m) due to clinical
trial costs not incurred in 2022, and more substantial work on
manufacturing.
Research and development (R&D) expenditure
External spend on R&D expenditure increased by GBP1.8m on
the prior year to GBP3.3m (31 March 2022: GBP1.5m). This reflects
the extensive work on product manufacture and scale up together
with the costs of the Phase Ib PK/PD trial.
Share-based compensation
Accounting standards require a charge to be made against the
grant of share options and recognised in the Consolidated Statement
of Comprehensive Income. Where such options lapse ahead of their
vesting date the relevant charges are written back. There was an
overall charge for the year in relation to share-based payments of
GBP0.2m (2022 GBP0.1m), which has no impact on cash flows.
Headcount
Average headcount of the Group for the year was 10 (2022:
9).
Taxation
The Group has elected to claim research and development tax
credits under the small or medium enterprise research and
development scheme of GBP0.93m (2022: GBP0.44m).
Share capital
No issues of shares were made during the year. At 31 March 2023
and 31 March 2022 there were 274,888,117 shares of 0.25p each in
issue.
Cash flows and financial position
The cash position (including short term deposits) at 31 March
2023 decreased to GBP5.0m (31 March 2022: GBP9.0m) reflecting
R&D and corporate costs, less GBP0.48m received from R&D
tax credits and GBP0.44m received from the STALICLA signing fee to
acquire the license rights.
GOVERNANCE
Employee engagement
As a very small company in terms of staff, Board members have
multiple points of contact with staff; through Board participation,
Board meeting feedback, and ad hoc interactions in relation to
specific matters.
These forums provide staff with an opportunity to give their
views which can then be taken into account in making decisions
likely to affect their interests.
Specific matters of concern to employees are dealt with in
management meetings and by email. Corporate developments and
Company performance are discussed weekly in management
meetings.
All staff are eligible for the Group's share option scheme and
this drives involvement in the Company's performance.
Stakeholder Engagement
The Group has a small number of major suppliers and consultants
that support its delivery of strategy and corporate goals. The
selection of, relationships with, and execution of, contracted work
by these parties is considered at least weekly by the Executive
Directors and at each Board meeting by all Directors. Where
appropriate, the Chairman and/ or non-executive directors
participate in engagement with these parties, and where
appropriate, Board members are involved in meetings with such
parties.
PRINCIPAL RISKS AND UNCERTAINTIES
Evgen is a biopharmaceutical company and, in common with other
companies operating in the sector, is subject to a number of risks.
The principal risks and uncertainties identified by the Group for
the year ending 31 March 2023 are set out below.
Development
The Group is at a relatively early stage of development and may
not be successful in its efforts to develop approved or marketable
products. Technical risk is present at each stage of the
development process which is a highly regulated environment which
presents technical and operational risk. There can be no guarantee
that the Group will be able to, or that it will be commercially
advantageous for the Group to, develop its Intellectual Property
through entering into licensing deals with pharmaceutical
companies.
Commercial and competition
The biotechnology and pharmaceutical industries are very
competitive. The Group's competitors include major multinational
pharmaceutical companies, biotech and early stage companies
developing novel approaches to treat disease in Evgen's chosen
fields of interest, and research institutions. Many of its
competitors have substantially greater financial, technical and
other resources. The Group's competitors may succeed in developing,
acquiring or licensing drug product candidates that are more
effective or less costly than those the Group is developing, or may
develop, and this may have a material adverse impact on the
Group.
Regulatory
The Group's operations are subject to laws, regulatory
approvals, and certain government directives, recommendations and
guidelines. There can be no assurance that future legislation will
not impose further government regulation which may adversely affect
the business or financial condition of the Group.
Intellectual property (IP)
The Group's success depends in part on its ability to obtain and
maintain patent protection for its technology and potential
products in the United States, Europe and other countries, and then
defend and enforce such IP. If the Group is unable to obtain and
maintain patent protection for its technology and potential
products, or if the scope of patent protection is not sufficiently
broad, competitors could develop and commercialise similar
technology and products, which could materially affect the Group's
ability to successfully commercialise its technology and potential
products. The Group is exposed to additional IP risks, including
infringement of IP rights, involvement in lawsuits and the
inability to protect the confidentiality of its trade secrets which
could have an adverse effect on the success of the Group.
Financial
The Group has a limited operating history, has incurred
significant losses since its inception and does not have any
approved or revenue generating products. The Group expects to incur
losses for the foreseeable future, and there is no certainty that
the business will generate a profit. The Group may not be able to
raise additional funds that will be required to support its product
development programs or commercialisation efforts, and any
additional funds that are raised may cause dilution to existing
shareholders.
Operational
The Group's future development and prospects depend to a
material extent on the experience, performance and continued
service of its senior management team including the Directors. The
Directors believe the senior management team is appropriately
structured for the Group's size and stage of development and is not
overly dependent on any one individual. The Group has entered into
contractual arrangements with these individuals with the aim of
securing the services of each of them. Retention of these services
or the identification of suitable replacements cannot be
guaranteed. The loss of the service of any of the Directors or
senior management and the cost of recruiting replacements may have
a material adverse effect on the Group and its commercial and
financial performance.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 March 2023
Year ended Year ended
31 March 31 March
2023 2022
Notes GBP'000 GBP'000
--------------------------------------------------- ------ ----------- -----------
Revenue 3 442 -
--------------------------------------------------- ------ ----------- -----------
Operating expenses
Operating expenses 4 (5,389) (3,047)
Share-based compensation 7 (157) (146)
--------------------------------------------------- ------ ----------- -----------
Total operating expenses 4 (5,546) (3,193)
--------------------------------------------------- ------ ----------- -----------
Operating loss 4 (5,104) (3,193)
--------------------------------------------------- ------ ----------- -----------
Finance income 5 98 24
Loss on ordinary activities before taxation (5,006) (3,169)
Taxation 8 963 439
--------------------------------------------------- ------ ----------- -----------
Loss and total comprehensive expense attributable
to equity holders of the parent for the
year (4,043) (2,730)
--------------------------------------------------- ------ ----------- -----------
Loss per share attributable to equity holders
of the parent (pence) 9
Basic loss per share (1.47) (0.99)
Diluted loss per share (1.47) (0.99)
--------------------------------------------------- ------ ----------- -----------
CONSOLIDATED AND COMPANY STATEMENTS OF FINANCIAL POSITION
as at 31 March 2023
Group Company
As at As at As at As at
31 March 31 March 31 March 31 March
2023 2022 2023 2022
Notes GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- ------ --------- --------- --------- ---------
ASSETS
Non-current assets
Property, plant and equipment 10 3 5 2 3
Intangible assets 11 43 53 - -
Investments in subsidiary undertaking 12 - - 73 73
--------------------------------------- ------ --------- --------- --------- ---------
Total non-current assets 46 58 75 76
Current assets
Trade and other receivables 13 216 125 10,466 10,487
Current tax receivable 912 425 842 361
Short-term investments and cash
on deposit - 4,520 - 4,520
Cash and cash equivalents 14 5,000 4,510 4,708 3,812
--------------------------------------- ------ --------- --------- --------- ---------
Total current assets 6,128 9,580 16,016 19,180
--------------------------------------- ------ --------- --------- --------- ---------
Total assets 6,174 9,638 16,091 19,256
--------------------------------------- ------ --------- --------- --------- ---------
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables 15 833 411 786 369
--------------------------------------- ------ --------- --------- --------- ---------
Total current liabilities 833 411 786 369
--------------------------------------- ------ --------- --------- --------- ---------
Equity
Ordinary shares 16 687 687 687 687
Share premium 16 27,870 27,870 27,870 27,870
Merger reserve 16 2,067 2,067 - -
Share-based
compensation 16 509 490 509 490
Retained deficit 16 (25,792) (21,887) (13,761) (10,160)
--------------------------------------- ------ --------- --------- --------- ---------
Total equity attributable to
equity holders of the parent 5,341 9,227 15,305 18,887
--------------------------------------- ------ --------- --------- --------- ---------
Total liabilities and equity 6,174 9,638 16,091 19,256
--------------------------------------- ------ --------- --------- --------- ---------
No Statement of Comprehensive Income is presented in these
financial statements for the parent company as provided by Section
408 of the Companies Act 2006. The loss for the financial year
dealt with in the financial statements of the parent company was
GBP3,739k (2022: GBP2,428k).
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31 March 2023
Ordinary Share Merger Share-based Retained
shares premium reserve compensation deficit Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------- --------- -------- -------- ------------- --------- --------
Balance at 31 March 2021 687 27,870 2,067 359 (19,172) 11,811
Total comprehensive expense
for the period - - - - (2,730) (2,730)
Transactions with owners
Share issue - lapsed options - - - (15) 15 -
Share-based compensation -
share options - - - 146 - 146
Total transactions with owners - - - 131 15 146
-------------------------------- --------- -------- -------- ------------- --------- --------
Balance at 31 March 2022 687 27,870 2,067 490 (21,887) 9,227
-------------------------------- --------- -------- -------- ------------- --------- --------
Total comprehensive expense
for the period - - - - (4,043) (4,043)
Transactions with owners
Share issue - lapsed options - - - (138) 138 -
Share-based compensation -
share options - - - 157 - 157
-------------------------------- --------
Total transactions with owners - - - 19 138 157
-------------------------------- --------- -------- -------- ------------- --------- --------
Balance at 31 March 2023 687 27,870 2,067 509 (25,792) 5,341
-------------------------------- --------- -------- -------- ------------- --------- --------
CONSOLIDATED AND COMPANY STATEMENTS OF CASH FLOWS
for the year ended 31 March 2023
Group Company
Year ended Year ended Year ended Year ended
31 March 31 March 31 March 31 March
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------------- ----------- ----------- ----------- -----------
Cash flows from operating activities
Loss before taxation (5,006) (3,169) (4,628) (2,803)
Interest income (98) (24) (98) (24)
Depreciation and amortisation 13 16 1 2
Share-based compensation 157 146 157 146
---------------------------------------- ----------- ----------- ----------- -----------
(4,934) (3,031) (4,568) (2,679)
Changes in working capital
(Increase)/decrease in trade
and other receivables (91) 110 21 26
Increase/(decrease) in trade
and other payables 423 (196) 417 (193)
---------------------------------------- ----------- ----------- ----------- -----------
Cash used in operations 332 (86) 438 (167)
Taxation received 475 533 408 35
---------------------------------------- ----------- ----------- ----------- -----------
Net cash used in operating activities (4,127) (2,584) (3,722) (2,811)
Cash flows generated from investing
activities
Monies (placed on) / received
from fixed-term deposit - 1,480 - 1,480
Monies received from short term
investments 4,520 - 4,520 -
Interest received 98 24 98 24
Acquisition of tangible fixed
assets (1) (3) - (3)
---------------------------------------- ----------- ----------- ----------- -----------
Net cash (used in)/generated
from investing activities 4,617 1,501 4,618 1,501
Movements in cash and cash equivalents
in the period 490 (1,083) 896 (1,310)
---------------------------------------- ----------- ----------- ----------- -----------
Cash and cash equivalents at
start of period 4,510 5,593 3,812 5,122
---------------------------------------- ----------- ----------- ----------- -----------
Cash and cash equivalents at
end of period 5,000 4,510 4,708 3,812
---------------------------------------- ----------- ----------- ----------- -----------
There were no cash flows from financing activities in the
current or prior financial years.
NOTES TO THE FINANCIAL STATEMENTS
1. General information
Evgen Pharma plc ('the Company') is a public limited company
incorporated in England & Wales and whose shares are traded on
the AIM market of the London Stock Exchange under the symbol EVG.
The address of its registered office is Alderley Park, Congleton
Road, Nether Alderley, Cheshire, United Kingdom, SK10 4TG. The
principal activity of the Company is clinical stage drug
development.
2. Significant accounting policies and basis of preparation
Basis of preparation
The financial information does not include all information
required for full annual financial statements and therefore does
not constitute statutory accounts within the meaning of section
435(1) and (2) of the Companies Act 2006 or contain sufficient
information to comply with the disclosure requirements of
UK-adopted International Accounting Standards. These should be read
in conjunction with the Financial Statements of the Group for the
year ended 31 March 2023 which were approved by the Board of
Directors on 07 June 2023.
The report of the auditor for the year ended 31 March 2023 and
31 March 2022 financial statements was unqualified, did not contain
a statement under Section 498(2) or Section 498(3) of the Companies
Act 2006 and did not include a matter to which the auditors drew
attention by way of emphasis without qualifying their report.
The consolidated financial statements have been prepared under
the historical cost convention.
The consolidated financial statements are presented in Sterling
(GBP) and rounded to the nearest GBP'000. This is the functional
currency of the Group, and is the currency of the primary economic
environment in which it operates. Foreign transactions are
accounted for in accordance with the policies set out below.
Basis of consolidation
The financial statements incorporate the financial statements of
the Company and entities controlled by the Company. Control is
achieved when the Company has the power over the investee; is
exposed, or has rights, to variable return from its involvement
with the investee; and, has the ability to use its power to affect
its returns. The Company reassesses whether it controls an investee
if facts and circumstances indicate that there are changes to one
or more of the three elements of control listed above.
Consolidation of a subsidiary begins when the Company obtains
control over the subsidiary and ceases when the Company loses
control of the subsidiary. Specifically, the results of
subsidiaries acquired or disposed of during the period are included
in the Consolidated Statement of Comprehensive Income from the date
the Company gains control until the date when the Company ceases to
control the subsidiary.
Where necessary, adjustments are made to the financial
statements of subsidiaries to bring the accounting policies used
into line with the Group's accounting policies.
All intragroup assets and liabilities, equity, income, expenses
and cash flows relating to transactions between the members of the
Group are eliminated on consolidation.
3. Going concern
At 31 March 2023, the Group had cash and cash equivalents of
GBP5.0 million.
The Directors have prepared detailed financial forecasts and
cash flows looking beyond 12 months from the date of the approval
of these financial statements. In developing these forecasts, the
Directors have made assumptions based upon their view of the
current and future economic conditions that will prevail over the
forecast period.
The Directors estimate that the cash held by the Group together
with known receivables will be sufficient to support the current
level of activities into the fourth quarter of 2024. They have
therefore prepared the financial statements on a going concern
basis.
4. Share-based payment charge
During the years ended 31 March 2023 and 31 March 2022, the
Group issued a number of share options to certain employees. A
Black-Scholes model was used to calculate the appropriate charge
for these periods. The use of this model to calculate a charge
involves using a number of estimates and judgements to establish
the appropriate inputs to be entered into the model, covering areas
such as the use of an appropriate risk-free rate and dividend rate,
exercise restrictions and behavioural considerations. A significant
element of judgement is therefore involved in the calculation of
the charge. The total charge recognised in the year to 31 March
2023 was GBP156,809 (year to 31 March 2023: GBP146,125).
5. Operating loss
An analysis of the Group's operating loss has been arrived at
after charging/(crediting)
Year ended
Year ended 31 March
31 March 2023 2022
GBP'000 GBP'000
-------------------------------------------------- --------------- -----------
Research and development expenses:
Amortisation of licenses 10 13
Other research and development 3,330 1,446
Staff costs (including share-based compensation)
- Note 7 1,390 1,153
Establishment and general:
Depreciation of property, plant and equipment 3 3
Operating lease cost - land and buildings 14 12
Foreign exchange loss/(profit) 34 2
Other administrative expenses 765 564
Total operating expenses 5,546 3,193
-------------------------------------------------- --------------- -----------
The Group has one reportable segment, namely the development of
pharmaceutical products all within the United Kingdom.
6. Loss per share
Basic loss per share is calculated by dividing the loss for the
period attributable to equity holders by the weighted average
number of ordinary shares outstanding during the year.
As at 31 March 2023 the Group had 20,730,037 (2022: 10,587,665)
share options outstanding which are potentially dilutive.
The calculation of the Group's basic and diluted loss per share
is based on the following data:
Year ended
Year ended 31 March
31 March 2023 2022
GBP'000 GBP'000
Loss for the year attributable to equity
holders for basic loss and adjusted
for the effects of dilution (4,043) (2,730)
----------------------------------------------- --------------- ------------
Year ended
Year ended 31 March
31 March 2023 2022
Number Number
Weighted average number of ordinary
shares for basic loss per share 274,888,117 274,888,117
----------------------------------------------- --------------- ------------
Effects of dilution:
Share options - -
Weighted average number of ordinary
shares adjusted for the effects of dilution 274,888,117 274,888,117
----------------------------------------------- --------------- ------------
Year ended
Year ended 31 March
31 March 2023 2022
Pence Pence
Loss per share - basic and diluted (1.47) (0.99)
----------------------------------------------- --------------- ------------
The weighted average numbers of ordinary shares for the years
ended 31 March 2022 and 2023 used for calculating the diluted loss
per share are identical to those for the basic loss per share. This
is because the outstanding share options would have the effect of
reducing the loss per ordinary share and would therefore not be
dilutive under the terms of International Accounting Standard
("IAS") No 33.
Basic loss per share is calculated by dividing the loss for the
period attributable to equity holders by the weighted average
number of ordinary shares outstanding during the year.
7. Issued capital and reserves
Group and Company
Ordinary shares of 0.25p Share Capital Share Premium Total
each
Number GBP'000 GBP'000 GBP'000
-------------------------- ------------ -------------- -------------- --------
As at 31 March 2022
& 31 March 2023 274,888,117 687 27,870 28,557
-------------------------- ------------ -------------- -------------- --------
There were no new shares issued in the year ending 31 March
2023.
The ordinary shares rank pari passu in all respects in relation
to dividends and repayment of capital and have equal voting rights
with one vote per share. There are no restrictions on the
transferability of the shares.
The Group and Company do not have an authorised share capital as
provided by the Companies Act 2006.
Other reserves
The share premium reserve represents the difference between the
net proceeds of equity issues and the nominal share capital of the
shares issued.
The merger reserves at 31 March 2023 and 2022 arose from the
acquisition of Evgen's sole subsidiary, Evgen Ltd, in 2014 which is
accounted for using the merger method of accounting.
The share-based compensation reserve reflects the aggregate fair
value of equity-settled share-based payment transactions.
Reserves classified as retained deficit represent accumulated
losses. None of the reserves are distributable.
8. Related party transactions
Group
Transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not
disclosed in this note.
During the year ended 31 March 2023, the Group purchased
consultancy services totalling GBPnil (year ended 31 March 2022:
GBP15,995) from FD Consult Ltd, a company controlled by Richard
Moulson. The amount owed to FD Consult Ltd at 31 March 2023 was
GBPnil (31 March 2022: GBPnil).
During the year the Group purchased services from OBN, a company
for which Huw Jones acts as a non-executive director, totalling
GBP1,440 (2022: GBP1,282). The amount owed to OBN at 31 March 2023
was GBPnil (31 March 2022: GBPnil).
Company
The Company is responsible for financing and setting Group
strategy. The Company's subsidiary carried out the Group's
development strategy and managed the Group's intellectual property.
The Company provides interest free and unsecured funding to its
subsidiary with no fixed date of repayment.
9. Report and accounts
A copy of the Annual Report and Accounts will shortly be sent to
all shareholders shortly with notice of the Annual General Meeting
and will also be available to download from the Group's website at
www.evgen.com .
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END
FR EAKKKEAPDEFA
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June 07, 2023 02:00 ET (06:00 GMT)
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