SR PHARMA PLC
UNAUDITED INTERIM RESULTS FOR THE 6 MONTHS ENDED 30 JUNE 2003
SR Pharma plc, the London based biopharmaceutical company, today announces its
unaudited interim results for the six months ended 30 June 2003.
Highlights
* Dr David Hill appointed CEO/ Strategic review completed
* Phase II Asthma trial - enrolment completed
* Phase II Atopic Dermatitis trial - recruitment on target
* IPG programme commenced in intellectual property acquired from Rodaris
Chairman's Statement
As I reported at the Annual General Meeting, Dr David Hill joined SR Pharma as
CEO in May 2003. I am very pleased to welcome him to the Group. David brings a
wealth of experience in the international biopharmaceutical sector following
senior roles in the United Kingdom, Europe and the USA. One of David's first
tasks was to undertake a strategic review of the Group and report to the Board.
This review process is complete and the conclusions are outlined in David's
report below.
The results for the half-year are set out on the following pages. At 30 June
2003,the Group had bank balances of over �6.4 million, down from �7.2 million
at 31 December 2002. Our cash position has been helped by the receipt of $1.5
million from Sakai, our Japanese license partner, which was shown as a debtor
at the year end. The results for the period are in line with our expectations,
with expenditure increasing as enrolment in our phase II clinical trials
increases.
It is with deep sadness that I have to report to shareholders the death on 20th
July of Professor Tim Chard, who was a non-executive director. Tim will be
greatly missed by us all. I also report that Dr David Kennard resigned as Chief
Operating Officer on 17 July.
In spite of the harsh environment in which we find ourselves, the Board remains
confident that M. vaccae products have considerable potential. Our focus
continues to be the completion of a rigorous development programme for M.
vaccae products which defines both the mechanisms of action in man and the
clinical benefit. We will look closely at opportunities within our IPG
portfolio and explore the therapeutic potential of these compounds in disease
models.
Finally, we are exploring ways of creating a sustainable company and this will
form a major part of our management team's activity over the coming year.
Eric Boyle
Chairman
25 September 2003
Chief Executive's Review
Despite certain successes, it is clear that the environment for
biopharmaceutical companies in Europe remains volatile. However, my review of
the Group's position concludes that the Group has valuable assets both in M.
vaccae products and the intellectual property in inositol phosphoglycans
("IPGs") acquired from Rodaris Pharmaceuticals Ltd. It is also apparent that to
date we have not yet been able to demonstrate a clear therapeutic advantage for
M. vaccae products - despite much early promise and an intense belief inside
the Group that these products have considerable potential.
That belief remains strong and we have made tremendous advances in our
understanding of the immune system and the subsequent unfolding of M. vaccae's
mechanisms of action. I believe that it is critical to continue the development
of the product, focused on the proof of mechanisms of action in man and its
therapeutic benefit.
In order to ensure that the regulatory package is as complete as possible at
this stage of development, we have planned a phase I study in asthmatic
volunteers. This study will start in the fourth quarter of this year and report
in the second quarter of next year. Its design is to demonstrate the same
effects on man's immune system as we have clearly shown in preclinical studies
carried out in collaboration with Novartis UK.
The current phase II studies with SRP299 in asthma and atopic dermatitis will
continue until completion. They are on schedule: the asthma study has completed
recruitment and will report in the second quarter of 2004; the atopic
dermatitis study should complete recruitment in November of this year and
report in the fourth quarter of 2004.
We have initiated research on the use of non-injectable dosage forms of M.
vaccae products. Our scientists believe that mucosal delivery may prove to have
significant therapeutic advantages in key indications for the products. SR
Pharma will present critical information on mucosal administration to potential
licensing partners when data becomes available over the coming year.
We have completed our review of the IPG technology acquired from Rodaris
earlier this year. The Group will explore the opportunity for fast tracking
candidates for specific areas of unmet need in the management of diabetes. With
this in mind, we will manufacture and test a number of lead compounds during
the first half of next year.
Our strategic review has also determined that there is room for some
rationalisation of our activities and improvement of our performance level.
Steps have been taken to reduce the headcount with a concomitant fall in our
overall fixed overheads. This rationalisation process will be completed by the
end of 2003.
I believe the Group is in a strong position to seek opportunities both inside
and outside its current focus and technology. In the present environment, it is
clear that there are a number of prospects the Group can pursue. Our aim is to
sustain the development of our technology whilst diversifying risk for our
shareholders.
David Hill
Chief Executive
25 September 2003
SR Pharma plc
Unaudited Group Accounts for the 6 Months Ended 30 June 2003
6 months ended 6 months ended Year ended
30 June 2003 30 June 2002 31 December
2002
� � �
Consolidated Profit and Loss
Account
Turnover 190,875 98,047 1,151,003
Research & Development (1,336,609) (1,220,272) (2,456,070)
Administration expenses (475,873) (334,021) (699,827)
________ ________ ________
Operating Loss (1,621,607) (1,456,246) (2,004,894)
Share of Operating Loss of - - (14,730)
Joint Venture
Interest Received 118,069 169,964 317,122
________ ________ ________
Loss for the period before (1,503,538) (1,286,282) (1,702,502)
taxation
Taxation credit 149,866 162,961 219,920
________ ________ ________
Loss for the period after � (1,353,672) � (1,123,321) �
taxation (1,482,582)
======= ======= =======
Basic loss per share (5.67)p (4.71)p (6.21)p
As at As at As at
30 June 2003 30 June 2002 31 December
2002
Consolidated Balance Sheet � � �
Fixed Assets 54,032 62,769 72,462
Investments - 1 -
_____ _____ _____
54,032 62,770 72,462
_____ _____ _____
Current Assets
Debtors 774,065 388,357 1,258,480
Bank 6,427,955 8,254,659 7,159,402
_________ ________ _________
7,202,020 8,543,016 8,417,882
Current Liabilities (1,147,256) (784,056) (1,027,874)
________ ________ _________
Net Current Assets 6,054,764 7,758,960 7,390,008
________ ________ _________
Net Assets � 6,108,796 � 7,821,730 � 7,462,470
======= ======= ========
Share Capital 238,607 238,607 238,607
Share Premium Account 19,978,803 19,978,803 19,978,803
Capital Reserve 183,916 183,916 183,916
Revenue Reserves (14,292,530) (12,579,956) (12,938,856)
________ ________ _________
Shareholders Funds � 6,108,796 � 7,821,730 � 7,462,470
======= ======= ========
6 months ended 6 months ended Year ended
30 June 2003 30 June 2002 31 December
2002
� � �
Consolidated Cash Flow
Statement
Net Cash Outflow from
Operating Activities (842,679) (1,318,682) (2,422,799)
Returns on Investments and
Servicing of Finance
Interest Received 118,069 169,964 317,122
Tax (Suffered)/Recovered (134) 357,961 264,922
Investing Activities
Payment to acquire tangible (6,701) (30,716) (73,590)
fixed assets
Disposal of tangible fixed - 900
assets
Acquisition of subsidiary - - (3,284)
________ _______ ________
Net Cash Outflow before (731,445) (821,473) (1,916,729)
Financing
Management of Liquid
Resources
Cash released from liquid 3,713 786,593 8,008,583
resources
_______ _______ ________
(Decrease)/Increase in Cash � (727,732) � (34,880) � 6,091,854
Balances
====== ====== =======
Notes
1. The information relating to the six month periods ended 30 June 2003 and 30
June 2002 is unaudited. The information relating to the year ended 31 December
2002 is extracted from the audited accounts of the Group which have been filed
at Companies House and on which the auditors issued an unqualified opinion.
2. The above financial information does not constitute statutory accounts
within the meaning of Section 240 Companies Act 1985
3. Loss per share is based on the weighted average number of shares in issue
during the period ended 30 June 2003 of 23,860,714. The options outstanding at
30 June 2003, 31 December 2002 and 30 June 2002 are considered to be
non-dilutive for the purpose of this calculation since their conversion into
ordinary shares would not increase the loss per share. Consequently there is no
diluted earnings per share to report for either period.
For further information please contact:
Melvyn Davies, SR Pharma plc
Tel: +44 (0) 20 7307 1620
Email: m.davies@srpharma.com
Website: www.srpharma.com
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