TIDMSYNC
RNS Number : 6840O
Syncona Limited
11 February 2021
Quarterly and Business Update
11 February 2021
Syncona Ltd, a leading healthcare company focused on founding,
building and funding a portfolio of global leaders in life science,
today issues its quarterly update covering the period from 1
October to 31 December 2020.
-- Clinical, financial and operational progress across the
portfolio in the quarter, with positive data updates, further
financing rounds and a new portfolio company founded
-- NAV return of (1.1) per cent in the period, 8.3 per cent NAV
return in the nine months from 31 March 2020
-- Continued capital deployment across the portfolio with
GBP81.0 million deployed in the quarter, GBP149.9 million in the
nine-month period; continue to expect to deploy between GBP150-250
million in this financial year
Martin Murphy, CEO, Syncona Investment Management Limited, said:
"Syncona has performed robustly throughout the COVID-19 pandemic
which has continued to present a significant challenge to
healthcare systems, economies and society. Despite this
environment, our portfolio companies have been resilient and
innovative, delivering key milestones and adapting to new ways of
working. I am proud of the Syncona team, who remain committed to
our purpose of investing to extend and enhance human life, despite
these challenging conditions.
The pandemic has also highlighted the importance of continuous
and rapid innovation in the life science sector. Our expert team,
differentiated strategy and strong capital base means we are well
positioned to build innovative companies that aim to leverage speed
and flexibility in drug development. We believe we will have an
important role in continuing to translate and commercialise
innovation into products for patients over the long-term."
Business update
The Syncona team is working productively remotely and continues
to generate promising opportunities to found new companies.
Following the outbreak of the COVID-19 pandemic in March 2020,
the Syncona team worked closely with our portfolio companies to put
in place scenario plans which accounted for our view on the
potential ongoing impact of the COVID-19 pandemic and our companies
continue to operate in line with these plans.
Since our half year update, we have continued to see a varying
impact of the COVID-19 pandemic on clinical trials across our
portfolio:
-- We have seen a relatively limited impact on trials in the
oncology setting, where the acute unmet need for patients in these
disease settings is very high. However, when there is significant
disruption to healthcare systems' abilities to manage severe
COVID-19 patient volumes, as we are seeing currently in the UK,
there are likely to be short periods of more significant
disruption.
-- In indications where there is an existing treatment or a
lower mortality risk, we have seen trials halted in light of new
national lockdowns across Europe. However, we have worked closely
with our companies to put in place innovative clinical solutions or
identify geographies where patients can be treated, to ensure that
trials are able to progress where possible.
-- We have largely been able to progress pre-clinical work and
the development of manufacturing capabilities and expect this work
to continue.
Syncona does not currently anticipate that the limited near-term
delays across our portfolio will have any impact to the reported
valuations of our privately held companies, applying our rigorous
approach to recognising changes to fair value and, in part,
reflecting the long term nature of our investments in these
companies.
Performance:
-- Net assets of GBP1,350.5 million, 201.1p [1] per share, a NAV
return of (1.1) per cent in the period, and an 8.3 per cent return
over the nine months from 31 March 2020
-- Life science portfolio valued at GBP735.9 million (GBP666.6
million Sept 2020), a total return of (1.7) per cent in the quarter
and 22.4 per cent over the nine months from 31 March 2020
Funding growth across the portfolio
-- Capital base of GBP614.6 million at 31 December 2020; with
approximately 93 per cent in cash and cash equivalents and the
remainder held in legacy funds
-- GBP81.0 million of capital deployed in the quarter, GBP149.9
million of capital deployed over the nine months from 31 March
2020
Portfolio company update
Clinical progress with further data reported:
-- Freeline reported positive data in its Phase I/II trial in
Haemophilia B demonstrating potential for a functional cure with
Factor IX expression levels in the normal range
-- Gyroscope dosed first patients in its Phase II programme for
dry age-related macular degeneration (AMD) which comprises one
trial where patients have a mutation in Complement Factor I and a
second trial focused on a broader patient population
-- Achilles continued to dose patients in its first two
programmes: non-small cell lung cancer (NSCLC) and melanoma
-- Anaveon published encouraging pre-clinical data on its
selective interleukin-2 (IL-2) agonist at the Society for
Immunotherapy of Cancer (SITC) demonstrating a high level of
activity and excellent safety profile
Autolus prioritisation of AUTO1
-- Autolus took the decision to prioritise the development of
the AUTO1 programme for Adult Acute Lymphoblastic Leukemia (ALL)
based on the positive data that the programme has generated to
date; Syncona strongly supports this decision
-- Over the next six months, Martin Murphy is working closely
alongside the senior leadership team of Autolus as they progress
the AUTO1 programme through to its pivotal trial
-- In addition, the company:
o Plans to seek partnership opportunities to fund additional
clinical development plans for AUTO3, in relapsed/refractory
diffuse large B cell lymphoma (DLBCL)
o Took decisive action in Q1 2021 to reduce its overall
headcount by approximately 20 per cent, realising cost savings, on
an annualised basis, of approximately $15 million once the
operational changes are fully implemented
o Continues to build and leverage its platform and capability to
progress its pipeline of next generation programmes
Companies accessing capital from specialist leading investors at
valuation uplifts
-- Achilles raised GBP52.7 million in a Series C financing, led
by specialist life science investors, further strengthening the
syndicate of investors and the company's capital position
o Series C priced at a premium to Syncona's holding value
o Final tranche of Series B invested of GBP11.7 million and
holding in Achilles revalued to GBP94.8 million, a GBP10.7 million
(1.6p per share) uplift to 30 September 2020 value
o Following the financing, Syncona retains a 34 per cent holding
in Achilles
Founding Purespring and attracting global leaders to the Syncona
platform
-- Foundation of Purespring, one of the first kidney focussed AAV gene therapy companies
globally, with a GBP45.0 million Series A commitment
-- Appointed of Richard Francis, former Chief Executive of
Sandoz and former member of Novartis Executive Committee, as Chief
Executive Officer
-- Richard will spend part of his time as a Partner at Syncona
Investment Management Limited, providing valuable advice and
bringing significant commercial and operational expertise across
the Syncona portfolio
New commitment to Quell in Syncona's largest ever Series A
financing
-- Further commitment of GBP25.3 million a GBP61.0 million
expanded Series A financing; taking Syncona's total commitment to
Quell to GBP59.3 million
-- Quell is the first company globally targeting liver
transplantation with engineered T regulatory cell therapy and is
set for clinical entry in the first half of CY2022
-- The company has also initiated research programmes in Type 1
Diabetes and neuroinflammatory diseases
Post period end:
Achilles announced that it expects to consider additional
capital raising options this year, which could include an initial
public offering in the United States. [2] The company also reported
that it has dosed the first six patients in its phase I/II trials
for non-small cell lung cancer and melanoma which showed no
significant safety issues with an Independent Data and Safety
Monitoring Committee recommending that both clinical trials
continued. Achilles now plans to move to higher doses and Syncona
supports this approach.
Freeline announced a modification to the clinical development
plan for its FLT180a program for Hemophilia B. Under the modified
clinical development plan, Freeline now plans to conduct dose
confirmation in a FLT180a Phase I/II trial instead of in the Phase
IIb part of the pivotal trial. Undertaking a Phase I/II in CY2021
will enable the company to address questions from the U.S. Food and
Drug Administration regarding Chemistry, Manufacturing and Controls
requirements and will enable the company to remain on track to
enter its Phase III pivotal study in the middle of CY2023 and
target a filing of the Biologic License Application with the U.S.
Food and Drug Administration by the end of 2024.
Autolus completed a public offering, raising total gross
proceeds of approximately $100.0 million, and with Syncona agreeing
to invest approximately $25.0 million (GBP18.1 [3] million).
Following the offering, Syncona retains a stake of approximately
26.2% in Autolus. The financing will enable the company to progress
its AUTO1 adult ALL programme through pivotal study.
Upcoming milestones:
-- Autolus to progress its pivotal study in AUTO1 adult ALL and
provide data update in calendar year CY2022
-- Autolus will publish clinical data from its AUTO 4 (T-cell
Lymphoma) and AUTO1/22 (paediatric ALL) in Q4 CY2021
-- Freeline to initiate phase I/II dose confirmation study for
its Haemophilia B programme in CY2021; will dose the next patient
in its Fabry trial when it is safe to do so
-- Achilles expects to begin enroling patients for its higher
dose cNet [4] therapy in its NSCLC and melanoma programmes in the
second half of CY2021
-- Gyroscop e will report interim data from its lead Phase I/II
programme targeting dry AMD on 12(th) February 2021*
-- SwanBio expects to file an Investigational New Drug application in FY2022
-- Quell expects initiation of Phase I/II clinical trial in FY2022
-- Anaveon expects initiation of Phase I/II clinical trial in FY2022
*Gyroscope's Chief Medical Officer, Dr Nadia Waheed, will
present data at the Angiogenesis conference on 12(th) February in a
presentation entitled: Results of Phase 1/2 Study on Gene Therapy
for the Treatment of Geographic Atrophy. The programme for the
conference can be found here:
https://umiamihealth.org/en/bascom-palmer-eye-institute/healthcare-professionals/continuing-medical-education/angiogenesis/program
.
Valuation movements in the quarter:
Company 30 Net Valuation FX 31 % NAV Valuation Fully Focus area
September investment change movement December [5] [6] diluted
2020 period (GBPm) (GBPm) 2020 [7] Ownership
Value (GBPm) value basis stake
(GBPm) (GBPm) %
Life science portfolio companies
Clinical
Autolus 143.7 - -34.7 -4.7 104.3 7.7 Quoted 27 Cell therapy
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Freeline 227.2 - 38.0 -13.9 251.3 18.6 Quoted 48 Gene therapy
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Gyroscope 82.0 17.3 0.1 -0.4 99.0 7.3 Cost 80 Gene therapy
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Achilles 72.4 11.7 10.7 - 94.8 7.0 PRI 34 Cell therapy
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Pre-clinical
SwanBio 33.0 23.9 - -2.8 54.1 4.0 Cost 75 Gene therapy
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Anaveon 12.4 - - -0.2 12.2 0.9 Cost 51 Immuno-oncology
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Quell 19.9 15.2 - - 35.1 2.6 Cost 74 Cell therapy
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Exit
Azeria 2.0 - - - 2.0 0.1 Proceeds 60 Small molecule
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Resolution 1.8 5.6 - - 7.4 0.5 Cost 79 Cell Therapy
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Purespring - 3.9 - - 3.9 0.3 Cost 84 Gene therapy
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Drug discovery
OMass 14.6 1.8 - - 16.4 1.2 Cost 49 Therapeutics
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Life Science Investments
CRT Pioneer Adj Third
Fund 35.8 1.2 - - 37.0 2.7 Party 64
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Adj.
CEGX 1.5 - - - 1.5 0.1 PRI 9
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Adaptimmune 8.5 - -2.9 -0.2 5.4 0.4 Quoted 0.8
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Neogene 11.8 - - -0.7 11.1 0.8 Cost 11
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Forcefield - 0.4 - - 0.4 0.0 Cost 82
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Total 666.6 81.0 11.2 -22.9 735.9 54.5
---------- ----------- ---------- --------- --------- ------ ---------- ---------- ----------------
Enquiries
Syncona Ltd
Annabel Clay
Tel: +44 (0) 20 3981 7940
FTI Consulting
Ben Atwell / Natalie Garland-Collins / Tim Stamper
Tel: +44 (0) 20 3727 1000
About Syncona:
Syncona's purpose is to invest to extend and enhance human life.
We do this by founding and building companies to deliver
transformational treatments to patients in areas of high unmet
need.
Our strategy is to create a dynamic portfolio of 15-20 globally
leading healthcare businesses for the benefit of all our
stakeholders. We focus on developing treatments for patients by
working in close partnership with world-class academic founders and
management teams. Our strategic balance sheet underpins our
strategy enabling us to take a long-term view as we look to improve
the lives of patients with no or few treatment options, build
sustainable life science companies and deliver strong risk-adjusted
returns to shareholders.
Copies of this press release, a company results presentation,
and other corporate information can be found on the company website
at: www.synconaltd.com
Forward-looking statements - this announcement contains certain
forward-looking statements with respect to the portfolio of
investments of Syncona Limited. These statements and forecasts
involve risk and uncertainty because they relate to events and
depend upon circumstances that may or may not occur in the future.
There are a number of factors that could cause actual results or
developments to differ materially from those expressed or implied
by these forward-looking statements. In particular, many companies
in the Syncona Limited portfolio are conducting scientific research
and clinical trials where the outcome is inherently uncertain and
there is significant risk of negative results or adverse events
arising. In addition, many companies in the Syncona Limited
portfolio have yet to commercialise a product and their ability to
do so may be affected by operational, commercial and other
risks.
[1] Fully diluted
[2] The timing and the terms of any such offering have not yet
been determined and are subject to market conditions and other
factors. There is no assurance that any such additional capital
raising will be completed.
[3] As at 09 February 2021
[4] Clonal neo-antigen T-cells
[5] Primary input to fair value
[6] The basis of valuation is stated to be "Cost", this means
the primary input to fair value is capital invested (cost) which is
then calibrated in accordance with our Valuation Policy
[7] The basis of valuation is stated to be "PRI", this means the
primary input to fair value is price of recent investment which is
then calibrated in accordance with our Valuation Policy
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END
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