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ValiRx PLC
05 May 2017
 

VALIRX PLC

("ValiRx", "the Company" or "the Group")

 

FINAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2016

 

London, UK, 5 May 2017: ValiRx Plc (AIM: VAL), a life science company with a focus on cancer therapeutics and diagnostics for personalised medicine, today announces its final results for the year ended 31 December 2016.

 

Operational

·      VAL201 has the last phase of its Phase l/ll study to complete in which patients will receive the highest dose level prescribed in the trial protocol

·      Phase ll Clinical Trial of VAL401 expected to complete dosing by the end of 2017 and subsequent analysis of the data will define the clinical activity of VAL401 and its effect on patient quality of life

·      New pre-clinical indication for Endometriosis, VAL301, currently in development through the reformulation of VAL201 - necessary regulatory approvals sought to enter VAL301 into a clinical trial in 2018.

·      Expansion of VAL201 & 401 trials into multi-centre studies will accelerate the accumulation of data and potential trial endpoints

·      Positive enhancements of ValiRx IP portfolio with multiple new worldwide patents being secured during the period for both VAL201 & VAL401

·      Peer reviewed articles recognise ValiRx's contribution at forefront of scientific development

·      Sale in July 2016 of TRAC Technology Rights for EUR 0.8 million.  This sale should be seen within the context of ValiRx's original purchase of the technology for EUR75,000, only months earlier 

·      Placing in September 2016 with existing and new investors successfully raised £1.2 million - Convertible Loan Facility with Yorkville also concluded for up to US$3.75 million in potential 3 tranches

·      Board concluded in July 2016 that ValiRx would not make further use of the Bracknor facility

Post Period

·      £1.16m Placing completed on 1 March 2017 with existing and new investors

Oliver de Giorgio-Miller, Non-Exec Chairman of ValiRx, commented:

"The year 2016 has been satisfactory. Our clinical trials have performed well and in line with expectations and the Company is looking forward to the next stage of its clinical trials. We are also continuing to develop our next generation therapeutics from our pre-clinical pipeline. Based on the positive results of the VAL201 and VAL401 compounds, the ValiRx team continue their discussions concerning late stage clinical studies and regarding potential partnerships and collaborations with pharmaceutical partners".

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

For more information, please contact:

 

ValiRx plc

Tel: +44 (0) 20 3008 4416

www.valirx.com

Dr Satu Vainikka, Chief Executive

Tel: +44 (0) 20 3008 4416

Tarquin Edwards, Head of Communications.

Tel: +44 (0) 7879 458 364

tarquin.edwards@valirx.com

Cairn Financial Advisers LLP (Nominated Adviser)

Liam Murray / Jo Turner

Tel: +44 (0) 20 7213 0880

Beaufort Securities Limited (Broker)

Jon Belliss

Tel: +44 (0) 207 382 8300

 

Notes for Editors

ValiRx is a biotechnology oncology focused company specialising in developing novel treatments for cancer and associated biomarkers. It aims to make a significant contribution in "precision" medicine and science, namely to engineer a breakthrough into human health and well-being, through the early detection of cancer and its therapeutic intervention.

 

The Company's business model focuses on out-licensing therapeutic candidates early in the development process. By aiming for early-stage value creation, the company reduces risk considerably while increasing the potential for realising value. The group is already in licensing discussions with major players in the oncology field.

 

ValiRx's two classes of drugs in development, which each have the potential for meeting hitherto unmet medical needs by existing methods, have worldwide patent filings and agreed commercial rights.   They originate or derive from Word class institutions, such as Cancer Research UK and Imperial College. 

 

Until recently, cancer treatments relied on non-specific agents, such as chemotherapy.  With the development of target-based agents, primed to attack cancer cells only, less toxic and more effective treatments are now possible. New drugs in this group-such as those in ValiRx's pipeline-promise to greatly improve outcomes for cancer patients.

 

The Company listed on the AIM Market of the London Stock Exchange in October 2006 and trades under the ticker symbol: VAL.

 

CHAIRMAN'S STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2016

I am pleased to report that in the last 12 months we have made important strides in growing our research and development capabilities, such that we remain at the forefront of personalised and precision medicine and on track to deliver breakthrough drugs that radically improve cancer treatment outcomes.

 

These advancements led to the Company featuring alongside The Chancellor of the Exchequer, The Rt Hon Philip Hammond, and a small number of outstanding organisations and being invited to appear in the 2015/16 edition of The Parliamentary Review.

 

During the period under review, we have made substantial progress in further developing the Phase l/ll clinical trial of our prostate cancer lead drug VAL201; we have initiated the Phase ll study of VAL401 for the treatment of late stage non-small-cell lung cancer and we have strengthened our pipeline with the addition of a new indication, VAL301, which is a reformulation of VAL201, for the treatment of Endometriosis.

 

In the last quarter of the year to the end of December 2016, we announced the grant of patents by both the European and Japanese Patent Offices for VAL201, giving ValiRx patent protection for this asset and exclusive commercial rights in the world's largest markets, including Japan, Europe and the US, with further patents pending in other significant geographies around the world.  

 

VAL201 is poised to enter the last lap of its Phase l/ll study in which patients will receive the highest dose level prescribed in the trial protocol. Hitherto, the trial has been conducted at University College London Hospital, however additional trial sites will participate in the final dose-escalating, therapeutically relevant phase of the trial, which remains on track to complete in 2017. VAL201 has thus far consistently demonstrated excellent safety and tolerability and has also shown evidence of disease stabilisation at a lower dose than was predicted by pre-clinical evaluations.  We anticipate that by increasing the dosage, we will see a higher level of efficacy, without compromising the safety and tolerability shown to date.

 

Q4 2016 has also proved a defining period in terms of VAL401's clinical development and the expansion of our drug pipeline.  VAL401 is a re-formulation of anti-psychotic drug Risperidone into an orally administered gelatin capsule. The compound has shown pronounced anti-cancer properties in pre-clinical testing and has moved straight into a Phase ll efficacy trial involving patients with locally advanced or metastatic non-small cell lung cancer, who have typically 6 - 12 months of life expectancy.  First dosing of patients commenced in November 2016.  Since then, further patients and clinical trial sites have been recruited and opened respectively, with initial pharmacokinetic analysis showing that the presence and levels of the active drug and known metabolite in blood samples, are as expected.  We expect to complete dosing by the end of 2017 and subsequent analysis of the data will define the clinical activity of VAL401 and its effect on patient quality of life.

 

Our new indication, named VAL301 is derived from our lead compound, VAL201.  It is currently in mid-stage pre-clinical development as a non-invasive, effective treatment for the non-cancerous, but hugely debilitating gynaecological condition, Endometriosis. Earlier pre-clinical work on VAL201 has highlighted the compound's potential to protect uterine tissue from the oestrogenic effects that give rise to Endometriosis, with minimal impact on bone density or fertility, which are major drawbacks frequently encountered with the current commonly used drugs for this condition. Our focus now is to complete the pre-clinical package so that the Company obtains the necessary regulatory approvals to enter VAL301 into a clinical trial in 2018.

 

Our financial results show an increase in the net operating loss for the year of £4,169,638 (2015: £2,702,124) and a loss per share from continuing operations of 8.54p (2015: Loss 5.63p).  This rise reflects the substantial increase in clinical activity undertaken during the period and the corresponding 54% increase in Research and Development costs (£2,375,354) in comparison to the prior period (2015: £1,543,441).  The rise in R&D costs relates to an escalation in patient recruitment; the ratcheting increase in cost of dosage increments over the period for the Phase l/ll clinical trial of VAL201 and the costs incurred surrounding the launch of VAL401 into its Phase llb clinical trial in Georgia.  Administration costs were impacted to a lesser extent, rising 32% to £1,794,284 (2015: £1,382,074).

 

We announced on 7 July 2016, that ValiRx had sold its subsidiary, ValiRx (Finland) Oy ("ValiFinn"), the company holding its Finnish-based TRAC Technology, to Sovicell Science for Life GmbH, for a cash consideration of €0.8 million.  This transaction represented an opportunity to commercialise a part of the Group's portfolio, whilst freeing up resource and management time and the sale reflected a substantial rise in value for TRAC, considering the TRAC Technology had been acquired just under a year earlier for only €75,000.  Later that month the Board resolved not to issue any further Convertible Loan Notes ("CLNs") to Bracknor and discontinued the use of the facility. As at 31 December 2016, the Group had cash and cash equivalents of £560,763 (2015: £232,465).  After the year-end and at the beginning of March 2017, the Company raised £1.16 million through a placement of shares to fund the further development of its drugs towards key clinical milestones, which the Directors believe will provide significant value inflection points for ValiRx and its shareholders.

 

In conclusion, I believe the Group has seen some very encouraging developments across its portfolio during the period to December 2016. The progress of our core clinical products, VAL201 and VAL401 is continuing to gain substantive momentum and by so doing, this headway offers potential investors an investable proposition and an attractive offering to joint venture partners. I would like to take this opportunity to express my sincere gratitude to all shareholders, fellow Directors, and every member of the Group for the trust and support accorded to the Board in positioning ValiRx among the frontrunners in the fields of personalised and precision medicine.

 

Oliver de Giorgio-Miller

Chairman

5 May 2017

 

CHIEF EXECUTIVE'S REPORT FOR THE YEAR ENDED 31 DECEMBER 2016

The year under review has been another exciting and pivotal period of momentum for ValiRx. Our lead compound, VAL201, has performed exceptionally in clinical trials, demonstrating safety, tolerability and early signs of potential efficacy against prostate cancer.   Our other re-profiled and reformulated therapeutic drug, VAL401, entered into clinical trials during the year. Both clinical trials have progressed well and have produced positive and exciting results. The pre-clinical pipeline is also progressing well together with our partners.

 

VAL201

Prostate cancer

The VAL201 compound, unlike most current therapies for prostate cancer, which often include androgen deprivation and the consequent loss of fertility and sex drive, selectively prevents tumour growth by specifically inhibiting the proliferation of tumour cells.  VAL201 is intended to target a specific pathway from the androgen receptor, thereby treating the cancer, but without suppressing sexual and other functions and without other debilitating side effects. The approach is a targeted therapeutic, whose pre-clinical results indicate that the therapy is likely to be less toxic than many other therapeutic options.

 

The Phase l/ll clinical trial of VAL201 and its application in subjects with hormone resistant prostate cancer is ongoing at University College Hospital, London. The readout from the first part of the trial - from first in human dosing through to a therapeutically meaningful dose - showed strong safety and tolerability in all trial subjects.   Other measurements taken were completely consistent and comparable to the results seen in the pre-clinical studies.  Furthermore, the trial has also shown indications of efficacy and disease stabilisation on CT imaging and a reduction of PSA progression, in the majority of patients.  Pre-clinical data has shown tumour growth is suppressed and metastasis is significantly reduced.

The VAL201 target is also associated with other cancers and there is significant potential for VAL201 to be used as a treatment for other hormone-induced cancers, such as breast and ovarian and also for the non-cancerous, but very debilitating condition, Endometriosis. 

 

Additional Clinical Trial Centres 

Building on these positive results, ValiRx is adding additional clinical sites to participate in the dose-escalating, therapeutically relevant phase of the trial to arrive at the maximum tolerated dose.  This can be taken forward by the Company or a partner into subsequent, larger, outcomes-oriented clinical trials to establish its effect on overall survival and on the health-related quality of life in patients with prostate cancer.

 

Endometriosis

The VAL201 clinical trial protocol also permits investigation of other solid hormone resistant tumour types and as mentioned earlier, our pre-clinical work has shown promising evidence of the compound's efficacy with respect to the treatment of endometriosis.   On the basis of these results, we have designed and developed the protocol to test VAL201 for endometriosis and other endometrial conditions and we anticipate this new indication to be an important extension of the compound's therapeutic use.  The Company continues with the design of a trial for VAL301 and the associated partnerships - both commercial and technical - are expected to be in place before the final reporting of the current 'safety and tolerability-focused' Phase I/II clinical trial completes.

 

VAL401

The Company's clinical efficacy trials of the novel cancer treatment drug, VAL401, for the treatment of lung cancer, are ongoing and the trial has been registered with the European Union Drug Regulating Authorities Clinical Trials Database (EudraCT). 

 

Following our announcement on 11 August 2016 that all regulatory approvals had been received for the VAL401 clinical trial in Tbilisi, Georgia, the company is pleased to report that patients have proceeded sufficiently through the dosing phase of the protocol, such that further patients were recruited.

 

As part of the initial biochemical testing, pharmacokinetic samples have been collected and are being analysed to see the levels of patient exposure to Risperidone displayed by our formulation.  Full analysis of this data will be performed after we collect data from up to 20 patients who are to be enrolled into the trial over the coming months.

 

Since the December 2016 announcement of the approval of the JSC Neo Medi Clinic, in Tbilisi, Georgia, as VAL401's second trial site, a third clinical site, the Research Institute of Clinical Medicine in Tbilisi, has now been initiated.  All three sites are now actively recruiting, allowing the differing specialities of clinics and investigators to be combined to provide the optimal team for the VAL401 trial.  A preliminary datalock is scheduled when all patients have completed the Day 15 pharmacokinetic analysis and this will enable a mid-trial data release.

 

TRAC

In February 2015, ValiRx acquired for €75,000 the Finnish gene expression and biomarker technology 'Transcript Analysis with the Aid of Affinity Capture' ("TRAC") for use by its wholly owned subsidiary biomarker unit, ValiRx (Finland) Oy ("ValiFinn"), based in Oulu, Finland .  In July 2016, ValiRx then sold this subsidiary to Sovicell Science for Life GmbH for €0.8 million. Going forward, ValiRx retains royalty-free rights to the technology for its own therapeutic developments and in support of its drug pipeline.

 

GeneICE

GeneICE "rebellious gene" technology continues to show good progress in the pre-clinical phase - the programme currently benefits from a second Eurostars grant for up to €1.6 million.  Rebellious genes are genes that are overexpressed when they should not be or are erroneously expressed, e.g. in cancers, inflammatory conditions, Alzheimer's and autoimmune diseases. ValiRx's proprietary GeneICE technology enables the design of compounds for selective silencing of specific genes.

 

The GeneICE lead compound has been designed against a gene expressing Bcl-2 protein, which has been implicated and associated with various cancers.  Pre-clinical work is currently being conducted with our partners, DKFZ, Heidelberg and Pharmatest in Finland and the compound continues to be tested to decide the most promising cancer types for further development.

 

Patents and Intellectual Property

The company has received several important international patent grants for VAL201 and VAL401 in major territories. ValiRx continues to expand its Intellectual Property ("IP") as its development programmes go forward and it remains open to technology acquisition opportunities, which complement and accelerate the development of the Group's therapeutic portfolio and to grow its value.

 

Outlook

2016 has been a satisfactory year.  Our clinical trials have performed well and in line with expectations and the Company is very much looking forward to the next stage of its clinical trials. We are also continuing to develop our next generation therapeutics from our pre-clinical pipeline. Based on the positive results of the VAL201 and VAL401 compounds, the ValiRx team continue their discussions concerning late stage clinical studies and regarding potential partnerships and collaborations with pharmaceutical partners.

 

Dr Satu Vainikka

Chief Executive

5 May 2017

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2016

 


 

2016

 

2015


£

£

Continuing operations



Research and development

(2,375,354)

(1,543,441)

Administrative expenses

(1,794,284)

(1,362,074)

Other operating income                                          

-

203,391

Operating loss                                                             

(4,169,638)

(2,702,124)

Fair value (loss)/profit on derivative

financial assets                                                            

 

(1,619,187)

 

463,023

Finance income                                                          

17

1,074

Fair value profit on derivative liability

375,621

-

Finance costs                                                               

(338,188)

(1,738)

 

(5,751,375)

 

(2,239,765)

Income tax credit                                                      

620,104

391,202

 

(5,131,271)

 

(1,848,563)

Discontinued operations



Profit/(loss) for the year from

discontinued operations                                           

 

182,750

 

(327,342)


 

(4,948,521)

 

(2,175,905)

Non-controlling interest

200,518

57,570

Loss for the year and total comprehensive income

 

(4,748,003)

 

(2,118,335)

Loss per share - basic and diluted



From continuing operations

(8.54)p

(5.63)p

 

 


CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2016


Share capital

Share premium

Merger reserve

Reverse acquisition reserve

Share option reserve

Non controlling interests

Retained earnings

Total


£

£

£

£

£

£

£

£

Balance at 1 January 2015                                    

7,281,806

 

7,604,732

 

637,500

 

602,413

154,144

 

26,374

 

(13,518,940)

 

2,788,029

 

Changes in equity for 2015









Loss for the year

-

-

-

-

-

(57,570)

(2,118,335)

(2,175,905)

On acquisition of subsidiary

-

-

-

-

-

110,265

-

110,265

Issue of shares

838,930

3,291,070

-

-

-

-

-

4,130,000

Costs in respect of shares issued

-

(368,940)

-

-

-

-

-

(368,940)

Movement in the year

-

-

-

-

49,375

-

-

49,375

Balance at 31 December 2015

8,120,736

10,526,862

637,500

602,413

203,519

79,069

(15,637,275)

4,532,824

Changes in equity in 2016









Loss for the year

-

-

-

-

-

(200,518)

(4,748,003)

(4,948,521)

On acquisition of subsidiary

-

-

-

-

-

141,068

-

141,068

Issue of shares

44,914

3,060,507

-

-

-

-

-

3,105,421

Costs in respect of shares issued

-

(589,267)

-

-

-

-

-

(589,267)

Movement in the year

-

-

-

-

127,934

-

-

127,934

Balance at 31 December 2016

8,165,650

12,998,102

637,500

602,413

331,453

19,619

(20,385,278)

2,369,459

 

 

 

 

 

 

 

 

 

Merger reserve

The merger reserve of £637,500 exists as a result of the acquisition of ValiRx Bioinnovation Limited. The merger reserve represents the difference between the nominal value of the share capital issued by the Company and the fair value of ValiRx Bioinnovation Limited at 3 October 2006, the date of acquisition.

Reverse acquisition reserve

The reverse acquisition reserve exists as a result of the method of accounting for the acquisition of ValiRx Bioinnovation Limited and ValiPharma Limited.

 

 


 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2016

 

 

 

ASSETS

 

£

2016

£

 

£

2015

£

Non-current assets

Intangible assets


 

2,824,613


 

2,673,363

Property, plant and equipment


10,553


22,177



2,835,166


2,695,540

Current assets

Inventories

 

-


 

43,950


Trade and other receivables

1,425,439


686,394


Derivative financial assets

140,675


1,463,023


Cash and cash equivalents

560,763


232,465



2,126,877


2,425,832


LIABILITIES

Current liabilities

Trade and other payables

 

 

1,254,139


 

 

588,548


Borrowings

1,294,299


-


Derivative financial liability

44,146


-



2,592,584


588,548


 

Net current (liabilities)/assets


 

(465,707)


 

1,837,284

Net assets


2,369,459


4,532,824

SHAREHOLDERS' EQUITY





Called up share capital


8,165,650


8,120,736

Share premium


12,998,102


10,526,862

Merger reserve


637,500


637,500

Reverse acquisition reserve


602,413


602,413

Share option reserve


331,453


203,519

Profit and loss account


(20,385,278)


(15,637,275)

Total shareholders' equity


2,349,840


4,453,755

Non-controlling interests


19,619


79,069

Total equity


2,369,459


4,532,824

 



 

CONSOLIDATED CASH FLOW STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2016

 


 

£

2016

£

 

£

2015

£

Net cash outflow from operating activities


(4,591,994)


(2,977,116)

Returns on investments and servicing of finance





Interest received

17


1,074


Interest paid

(338,188)


(1,793)


Net cash (outflow)/inflow for returns on investments and servicing of finance


 

(338,171)


 

(719)

Taxation


375,926


387,747

Capital expenditure





Payments to acquire intangible assets

(386,625)


(389,926)


Payments to acquire tangible assets

-


(31,670)


Receipts from sales of tangible assets

3,470


-


Net cash outflow for capital expenditure


(383,155)


(421,596)

Acquisitions and disposals





Sale of subsidiary undertakings (net of cash acquired)

 

1,215,718


 

-


Non-controlling interest

141,068


110,265


Net cash inflow for acquisitions and disposals


1,356,786


110,265

 

Financing





Issue of ordinary share capital

1,695,906


3,050,000


Cost of share issue

(589,267)


(368,940)


New convertible loan notes

2,993,113


-


Costs of convertible loan notes issued

(190,846)


-


Net cash inflow from financing


3,908,906


2,681,060

Increase/(decrease) in cash in the year


328,298


(220,359)

Cash and cash equivalents at beginning of period


232,465


452,824

Cash and cash equivalents at end of period


560,763


232,465

 



 

NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2016

 


Reconciliation of operating loss to net cash outflow from operating

activities

2016

2015



£

£


Operating loss from continued and discontinued activities

(4,528,220)

(3,029,411)


Depreciation of tangible assets

10,560

10,906


Amortisation of intangible assets

92,275

91,831


Decrease/(increase) in stocks

11,733

(32,800)


(Increase)/decrease in debtors

(1,071,548)

94,663


Increase/(decrease) in creditors within one year

787,726

(166,527)


Other non-cash movements

(22,454)

4,847


Share option charge

127,934

49,375


Net cash outflow from operating activities

(4,591,994)

(2,977,116)

 

 

1.      Basis of preparation

The financial information set out above does not constitute the Company's statutory accounts for the year ended 31 December 2016, but is derived from those accounts. Statutory accounts for 2016 will be delivered to the Registrar of Companies following the Company's annual general meeting.

2.      Loss per ordinary share

The earnings and number of shares used in the calculation of loss per ordinary share are set out below:


2016

2015


£

£

Continuing operations



Loss for the financial period from continuing operations

(5,131,271)

(1,848,563)

Non controlling interest

200,518

57,570


(4,931,753)

(1,790,993)




Discontinued operations



Profit/(Loss) for the year from discontinued operations

182,750

(327,342)




Basic



Weighted average number of shares

57,743,223

31,789,529

Loss per share - continuing operations

(8.54)p

(5.63)p

Earnings/(loss) per share - discontinued operations

0.32p

(1.03)p

 

There was no dilutive effect from the share options outstanding during the year.

3.      Publication of Report & Accounts

The report and accounts for the year ended 31 December 2016 will be posted to shareholders shortly and will be available from the Company's website, www.valirx.com


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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