TIDMEVG
RNS Number : 8678P
Evgen Pharma PLC
15 June 2020
Evgen Pharma plc
(the "Company")
Final Results
Evgen Pharma plc (AIM: EVG), the clinical stage drug development
company developing sulforaphane based medicines for the treatment
of multiple diseases, announces its final results for the year
ended 31 March 2020.
Operational highlights
-- Positive results from the STEM trial of SFX-01 in metastatic
breast cancer presented at European Society of Medical Oncology
Congress in Barcelona, demonstrating the stabilisation of
previously progressive disease and objective responses in some
patients
-- Five patients who participated in the STEM trial received
SFX-01 treatment for over one year with no tumour progression
-- Results from the SFX-01 After Subarachnoid Haemorrhage
("SAS") trial did not meet primary or secondary efficacy endpoints,
however the treatment was well tolerated with no safety concerns,
supporting evaluation in other indications
-- Significant progress made in tablet formulation of SFX-01
that will underpin easier clinical use in a range of indications
and yield economic and production benefits
-- Memorandums of Understanding reached with Guy's and St
Thomas' NHS Foundation Trust, University of Dundee and University
of Rochester (NY) to support clinical trials of SFX-01 in autism,
non-alcoholic steatohepatitis and chronic kidney disease,
respectively
-- Research collaboration with King's College London and the
British Heart Foundation to investigate how SFX-01 mediates
upregulation of Nrf2 in the blood-brain barrier endothelium
in-vivo
Post period end highlights
-- Publication in Oncogene of preclinical data for SFX-01's role
in targeting STAT3 signalling and inhibition of endocrine resistant
stem-like cells in ER-positive breast cancer
Financial highlights
-- Financial performance in-line with expectations:
o Post tax loss of GBP2.7m (2019: loss of GBP2.6m)
o Cash outflow from operations of GBP2.6m (2019: outflow of
GBP2.3m)
o Cash balance at 31 March 2020 of GBP4.1m (31 March 2019:
GBP2.0m)
-- Oversubscribed fundraising in May 2019 raised GBP5.0m before expenses
Barry Clare, Executive Chairman of Evgen Pharma, said: "We move
forward with the confidence that the value of SFX-01 as a potential
drug that is active against the two key pathways of Nrf2 and STAT3
will become increasingly clear. These pathways are of significance
in a range of diseases including cancer, autism and those where
oxidative stress is a factor. We therefore believe that the
fundamentals are in place to underpin sustainable share price
growth and deliver the undoubted potential of SFX-01. On behalf of
myself and the Board, I would like to thank our shareholders for
their continued support and we look forward to updating the market
with positive news in the coming year."
The information communicated in this announcement is inside
information for the purposes of Article 7 of EU Regulation
596/2014.
Enquiries:
Evgen Pharma plc www.evgen.com via Walbrook
Barry Clare, Chairman
Richard Moulson, CFO
finnCap www.finncap.com +44 (0)20 7220 0500
Geoff Nash / Teddy Whiley (Corporate
Finance)
Alice Lane (ECM)
Walbrook PR +44 (0)20 7933 87870 or evgen@walbrookpr.com
+44 (0)7980 541 893 / +44 (0)7876
Paul McManus / Anna Dunphy 741 001
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 naturally
occurring compound sulforaphane and novel proprietary analogues
based on sulforaphane. The lead product, SFX-01, is a patented
composition of synthetic sulforaphane and alpha-cyclodextrin.
Clinical data from the Company's open-label Phase II STEM trial
has shown that SFX-01 can halt the growth of progressing tumours in
patients with oestrogen-positive (ER+) metastatic breast cancer,
and in some cases significantly shrink the tumour, whilst causing
very few side effects.
The Company commenced operations in January 2008 and has its
headquarters at The Colony, Wilmslow, Cheshire, and its registered
office is at the Liverpool Science Park, Liverpool. It joined the
AIM market of the London Stock Exchange in October 2015 and trades
under the ticker symbol EVG.
For further information, please visit: www.evgen.com
CHAIRMAN'S STATEMENT
We have now completed two Phase II trials on SFX-01, in
different conditions and with quite separate mechanistic
hypotheses. Our selections of metastatic breast cancer ("mBC") and
Subarachnoid Haemorrhage ("SAH") were based on strong preclinical
data sets. The mBC clinical result was positive, demonstrating the
stabilisation of previously progressive disease in 24% of patients
and objective responses in some others. We were surprised and
disappointed that the SAH trial did not similarly follow the
preclinical data, albeit this is a particularly challenging
indication in which to test our drug. However, the scientific
evidence for sulforaphane and SFX-01 as a potent Nrf2 activator is
compelling, and the clinical belief in Nrf2 activation as a
therapeutic strategy is affirmed by the endorsement of our clinical
investigator partners, who wish to test SFX-01 in various diseases
where Nrf2 activation is important.
In a different mode of action in breast cancer models, SFX-01
has been shown to down regulate STAT3, a therapeutic target of
increasing interest in a number of tumour types. We therefore
remain committed to the on-going clinical development of SFX-01
both in breast cancer, and in pursuing a range of diseases where
there is evidence supporting potential clinical benefit with Nrf2
up-regulation.
To this end we are expanding our programme of UK and
international collaborations, working with highly- regarded
clinical investigators who wish to test SFX-01 clinically in
diseases they are researching. We have entered into Memorandums of
Understanding with Guy's and St Thomas' Hospitals in London
(autism), Dundee University (Non-Steroidal Acute Hepatitis) and
University of Rochester, New York State (chronic kidney disease).
We hope that at least one of these indications will progress to
clinical trial.
We were very pleased with the oversubscribed fundraising
completed in May 2019 which achieved GBP5m before expenses in
difficult market conditions. This provided us with a strengthened
balance sheet, the resources to undertake product formulation that
will facilitate the next mBC trial and other investigator-led
clinical studies, and funds to complete long term toxicology
studies that will remove current restrictions on the duration of
clinical trial treatment phases.
In relation to the COVID-19 epidemic, all personnel have been
working entirely remotely since the UK was put into lockdown.
Previously, some remote working was routine and hence this change
should not affect our operations significantly. Evgen operates a
virtual business model, outsourcing most R&D and all
manufacturing activities. To date, there have been minor delays to
our pre-clinical and manufacturing outsourcers and with no on-going
clinical trials we are not affected by the focus of trial sites on
COVID-19.
After 10 years at Evgen, Steve Franklin resigned from the
Company at the end of April this year. Steve has made a huge
contribution to the progress of Evgen to date and he leaves with
our very best wishes. A search is ongoing for a new CEO to lead the
Company and to continue to accelerate the growth of the
business.
We move forward with the confidence that the value of SFX-01 as
a potential drug that is active against the two key pathways of
Nrf2 and STAT3 will become increasingly clear.
We therefore believe that the fundamentals are in place to
underpin sustainable share price growth and deliver the undoubted
potential of SFX-01.
Barry Clare
Executive Chairman
12 June 2020
STRATEGIC REPORT
The Directors present their Strategic Report for the year ended
31 March 2020. The Operational Overview, Key Performance
Indicators, Financial Review and Principal Risks and Uncertainties
sections form part of the Strategic Report.
OPERATIONAL OVERVIEW
INTRODUCTION
Evgen is a clinical stage drug development company focussed on
the development of sulforaphane-based compounds, a new class of
pharmaceuticals which are synthesised in a proprietary,
well-tolerated, stable formulation. We have a comprehensive
intellectual property package over this technology. Our pipeline
exploits sulforaphane's activity in two separate biochemical
pathways; inhibition of pSTAT3, of importance in controlling cancer
metastases, and up-regulation of Nrf2, a therapeutic target
associated with a broad range of diseases which are characterised
by excessive oxidative stress and inflammation.
Sulforaphane has attracted huge scientific interest and has been
shown to have anti-cancer and neuroprotective qualities in a wide
range of preclinical and clinical studies, for example breast
cancer, prostate cancer, multiple sclerosis and autism.
Our lead product, SFX-01, has demonstrated efficacy in a Phase
II trial for advanced metastatic breast cancer. It has been used to
treat over 130 people in clinical trials and is well-tolerated with
predominantly mild side-effects.
Evgen has exclusive rights to the only technology
(Sulforadex(R)) proven to synthesise this very unstable molecule in
a stabilised composition that will satisfy regulatory and medicinal
needs for a pharmaceutical and that can be used as a
therapeutic.
CLINICAL TRIAL RESULTS AND STRATEGY REVIEW
Our aim on going public was to complete two Phase II trials on
SFX-01 in different conditions with quite separate mechanistic
hypotheses; the objective being to manage the risk profile
typically associated with Phase II trials and demonstrate efficacy
in at least one indication. To this end, we have had a success with
the STEM trial, with SFX-01 being tested in 46 patients that had
become resistant to all currently approved hormone therapies. In
this difficult to treat population, SFX-01 halted the progressive
disease for at least six months in 25% of patients, with at least
two patients showing demonstrable tumour shrinkage. Furthermore,
five patients went on to have their progressive disease halted for
at least a year, and one patient continued to receive SFX-01
treatment for over 18 months.
Given that the ultimate aim is to target patients earlier in the
disease pathway (i.e. prior to them being resistant to all approved
hormone therapies), we believe that the results from STEM bode well
for the probability of success of a randomised, double blind
follow-on trial. The details of that trial design and associated
costings will be finalised in 2020, and we are escalating the
activity associated with securing non-dilutive funding to pay for
all, or substantially all, of a follow-on trial.
We were surprised that the strong preclinical data for SFX-01 in
SAH was not reflected in the SAS trial. Whilst we recognised that
trials in stroke are challenging, we were nevertheless confident of
observing some favourable effects given the strength of the
preclinical data. The study met our expectations with regard to
safety and tolerability, but missed the other key primary endpoint
associated with the modulation of blood flow in the middle cerebral
artery; this blood flow being a means of measuring the onset of
vasospasm that leads to the Delayed Cerebral Ischaemia ("DCI").
Several cognitive measures constituted secondary endpoints, and,
whilst the study was not powered to demonstrate statistical
efficacy for these endpoints, we had expected to see a favourable
trend across the different questionnaire-based tests that ascertain
the extent of any cognitive deficit.
Importantly, we have concluded that the SAS results are likely
to be specific to that condition and because animal models for SAH
can translate poorly to SAH in patients. In addition, our dosing
regime, restricted to a maximum of 28 days, may have been too short
to impact cognitive measures at three and six months. There remains
a strong rationale for clinically testing SFX-01 in any condition
that is mechanistically linked to Nrf2, as evidenced by the recent
positive developments at Reata (NASDAQ: RETA). Reata is developing
Nrf2 activators based on triterpenoids and with positive top-line
results in pivotal trials in Friedriech's Ataxia and Alport
Syndrome has a current market capitalisation of circa US$5bn. This
illustrates that the fundamentals of Nrf2 activation as a
therapeutic strategy are sound and SFX-01 is a potent and well
tolerated Nrf2 activator; on this basis we advance with confidence
in SFX-01 and believe that the main driver to ultimate success is
perseverance.
Given the funding constraints suffered by small cap drug
development companies in the UK, our strategy is to move to a
business model where we facilitate multiple clinical trials on
SFX-01 in risk-sharing arrangements, with the objective of
attracting non-dilutive funding from grants and/or charities to
wholly or substantially fund future clinical activity. This
strategy has three key components:
(1) Our first priority is to ensure the continued development of
the breast cancer programme. We will complete the trial design and
cost a clinical trial protocol and then seek non-dilutive funding
for Evgen and/or an affiliated clinical institution to sponsor the
trial.
(2) In parallel we aim to leverage the extensive pre-clinical
and clinical data that shows the potential for SFX-01, as a
sulforaphane delivery platform, to be used in diseases that are
beyond our capacity to pursue.
(3) In addition, we will pursue opportunities to apply our
intellectual property on stabilised sulforaphane to
non-pharmaceutical opportunities which offer a more rapid route to
market.
We will therefore support a number of proposed
Investigator-Initiated Trials - these are trials led by a clinician
from a well-renowned institution, with that institution being the
sponsor for the trial. Evgen will provide support as required (in
the confines of an investigator sponsored study), sharing our
knowledge, experience and the methods and laboratories used for
pharmacodynamic and pharmacokinetic endpoints. All such trials are
subject to grant funding being procured and Evgen will supply
clinical centres with SFX-01 and, where appropriate, a placebo.
Evgen will have the right to access the clinical data on fair
commercial terms to advance its clinical and commercial
development. Since the principal funding for these trials will be
obtained by the investigator/ institution they have limited impact
on our cash reserves.
We have announced three Memorandums of Understanding relating to
further potential trials in non-alcoholic steatohepatitis, chronic
kidney disease and autism, and are in discussions for others. We
are hopeful that at least one of these will be awarded a grant so
as to commence in H2 this year or H1 2021.
Finally, we are now in a period where we are using funds from
the last investment round to complete the technical package
required to support this strategy. This involves investment in
Chemistry, Manufacturing and Controls ("CMC") in developing a
tablet formulation for world-wide distribution to multiple clinical
centres, and investment in the toxicology package to be able to
support trials of longer dosing duration (i.e. over 28 days). By
the time this CMC investment period is complete, we could initiate
a portfolio of clinical trials such as those described above.
We believe this strategy offers the best route to enhance
shareholder value and the opportunity for all stakeholders to
benefit from the undoubted potential of SFX-01 and our broader
technology platform.
CLINICAL PROGRAMMES
METASTATIC BREAST CANCER
Breast cancer is the biggest cause of cancer deaths in women
worldwide. In around 75% of breast cancers, the hormone oestrogen
plays a key part in tumour growth. Such tumours express the
oestrogen receptor (ER+) and, if the cancer is metastatic,
endocrine therapy has been the principal approach to treatment. It
is thought that hormone independent cancer stem cells are
implicated in the development of resistance to hormone therapy and
the spread of the disease by metastases. Since 2012, Evgen has
worked with University of Manchester scientists at the Cancer
Research UK Manchester Institute and together we have generated
promising data showing SFX-01 reduces the number of cancer stem
cells in patient-derived breast cancer tissue in xenograft models.
The xenograft studies used a combination of hormone therapy and
SFX-01, with the role of SFX-01 being to target the cancer stem
cell population. Crucially, the data also showed that SFX-01 is
unique, compared with existing marketed therapies, in deactivating
phosphorylated STAT3, a key agent in driving cancer metastases and
resistance to current standards of care. This data was recently
published in the prestigious journal, Oncogene.
In March 2019, we announced positive results from the open-label
Phase II trial of SFX-01 in 46 patients with oestrogen-positive
metastatic breast cancer. In particular we demonstrated:
-- Conclusive evidence of anti-cancer activity via objective responses (tumour shrinkage)
-- 24% of patients showed a durable clinical benefit for at
least six months, despite the late stage of disease and patients'
established resistance to hormone therapy. Of these, five patients
were still receiving SFX-01 at 12 months and one patient still
remains on treatment after 18 months
-- A mild and favourable side effect profile for an anti-cancer drug
We are embarking on a campaign to source non-dilutive funds for
a follow-on placebo-controlled randomised trial in ER+ metastatic
breast cancer, to generate the data that would maximise the
likelihood of a corporate partnership/out-licensing deal. Such
funding may be sourced from direct grants, cancer charities or
possibly via investigator-led trials.
Based upon consultation with our clinicians and KOLs, our
preferred market positioning of SFX-01 is in combination with
hormone therapy following progression on CDK4/6 inhibitors.
Resistance to CDK4/6i (which will ultimately manifest in all
patients) will become the new challenge that needs to be
addressed.
Key activities that will facilitate the next mBC clinical trial
are:
-- Ensuring our preclinical data package is sufficient and robust to support the study design
-- Finalising the Clinical Trial Protocol synopsis and establishing full costings
-- Using the funds we raised in 2019 to:
- Finalise the development of the new tablet formulation for mBC
study and also investigator-led trials in new indications
- Expand the toxicology package to enable longer-term dosing in investigator-led trials
-- Securing non-dilutive funding to fund part, or all, of the mBC study.
SUBARACHNOID HAEMORRHAGE ("SAH")
In November we announced results from our trial of SFX-01 in
SAH. Unfortunately, the primary endpoint of reducing blood flow
velocity in the middle cerebral artery was not achieved, with no
significant difference between the SFX-01 and placebo arms.
Furthermore, whilst the secondary endpoints were not statistically
powered, there were no consistent differences seen between SFX-01
and placebo in key cognition, quality of life and clinical outcomes
at three and six months. This was surprising given the strong
preclinical data for sulforaphane in animal models of SAH and other
forms of stroke. SFX-01 was however shown to be well-tolerated with
no safety concerns.
In the multi-centre, randomised, double-blind,
placebo-controlled SAS Phase II clinical trial, patients were dosed
for a maximum of 28 days following a SAH, covering the period at
which they are at risk of a Delayed Cerebral Ischaemia. Patients
were then monitored for a further five months to assess their
recovery by collecting endpoints including cognitive
measurements.
After an extensive review with our clinical advisors, we have
concluded that the results of the SAS trial cannot be used to
discount the viability of a trial in any other indication linked to
the Nrf2 pathway including those of the central nervous system. SAH
is a traumatic and serious condition and the likelihood is that the
animal models are poorly prognostic of the clinical condition in
humans.
What we do know is that Nrf2 pathway remains an attractive
target for therapeutic intervention in many diseases characterised
by oxidative stress and inflammation, and that SFX-01 is a potent
activator of the Nrf2 pathway with a relatively benign safety
profile. On this basis, there is no sound rationale for believing
the SAS trial read-out will be precedent to other indications.
NON-CLINICAL PROGRAMMES
We are making good progress with the activities set out in the
use of funds statement relating to the April 2020 fundraising.
Specifically, we have contracted with a large Clinical Research
Organisation to start the extended toxicology programme that is
needed to support a broader diversity of clinical trial designs -
including being able to dose for greater than 28 days in patients
who do not have terminal disease. The pilot work has been
completed, the full programme has started and will conclude later
in this year.
With regard to the formulation work to develop a new tablet -
required to scale manufacturing and support multiple trials - we
have also contracted with a large and well-established Contract,
Development and Manufacturing Organisation to initiate that work.
Work is well underway and expected to be completed by the end of
the year.
Additional work to add value to the supply chain proposition is
also underway.
PRE-CLINICAL COLLABORATIONS
In addition to our core in-house programmes, we continue to
support academic research to broaden the range of applications for
SFX-01 and increase our mechanistic understanding in these
different disease areas.
Currently, we are working with research groups conducting
pre-clinical work to investigate the potential of SFX-01, inter
alia, in: triple negative breast cancer (University of Manchester,
UK), glioblastoma (University of L'Aquila, Italy), osteoarthritis
(RVC, University of London, UK) and ischaemic stroke and autism
(both at King's College London, UK).
We are hopeful that some of these projects will progress into
clinical evaluation over the next few years.
Finally, we have a mechanistic collaboration with Imperial
College, London to use advanced chemical proteomics technology to
detect targets for SFX-01 and other sulforaphane analogues in live
cells or tissues in specific disease model systems. This should
provide greater understanding of mechanism(s) of action and
contribute data important for current and future clinical
development. The first data from this collaboration was presented
at the end of March providing further elucidation of the potential
mechanism of action of SFX-01 in metastatic breast cancer, and
suggesting potential biomarkers for determining the efficacy of
SFX-01 in this indication. In particular, that SFX-01 influences
growth hormone signalling and that phosphorylated STAT3 and,
interestingly, MIF (macrophage migration inhibitory factor), may be
a useful biomarker for response to SFX-01.
INTELLECTUAL PROPERTY UPDATE
Our IP portfolio continues to be strengthened with a number of
key patents being granted. The current status of the intellectual
property portfolio is as follows:
-- From the "parent" patent family entitled "Stabilised
Sulforaphane" patents are granted in Australia, Canada, EU, US,
Japan and Hong Kong.
-- The principal manufacturing patent application, entitled
"Methods of Synthesising Sulforaphane" is granted in Australia,
China, Europe, Japan and further applications are pending in
Brazil, Canada, US and India.
-- A second manufacturing patent which is directed to methods of
isolating and purifying sulforaphane or analogues from natural
sources has been granted in Europe, US, Japan and China.
-- The patent application providing protection around novel
analogues based on sulforaphane, and entitled "Sulforaphane-Derived
Compounds" is granted in Australia, China, Europe, Japan and the US
and pending in Canada.
During the year composition of matter SFX-01 patents were
granted both in Japan and Europe with a product claim for a complex
of sulforaphane and alpha-cyclodextrin. The Group has long held
broad compositional patent protection in the United States since
patent grant in 2011 and in Canada since grant in 2014.
Furthermore, new composition of matter filings have been made
which, if successful, would add a further 20 years of patent life
to the key patent family.
PEOPLE
After 10 years at Evgen, Steve Franklin resigned from the
Company at the end of April this year. Steve has been pivotal in
developing the Group from start up to the point where two phase II
trials have been completed and substantial opportunities created.
We have appointed a high quality search and selection firm to
support the replacement process, and look forward to announcing a
new CEO who can drive the future of Evgen in due course.
KEY PERFORMANCE INDICATORS
Key Performance Indicators include a range of financial and non-
financial 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.
2020 (GBPm)
--------------------------------------------------- ------------
Year-end cash and short-term investments and cash
on deposit held: (2019: GBP2.0m) 4.1
The increase in year-end cash reflects the fundraising in May
2019 which raised GBP5m before expenses, offset in part by working
capital, pre-clinical and clinical expenditures.
2020 (GBPm)
---------------------------------------------------- ------------
Net cash inflow (including short-term investments)
(2019: outflow: GBP1.6m) 2.1
The net cash inflow reflects the fundraising completed during
the year less working capital, pre-clinical and clinical
expenditures.
2020 (GBPm)
--------------------------------- ------------
Operating loss: (2019: GBP3.1m) 3.2
The operating loss reflects pre-clinical and clinical activity
in the year and related product manufacture.
FINANCIAL REVIEW
The financial performance for the year ended 31 March 2020 was
in line with expectations.
Losses
The total loss for the year was GBP2.7m (31 March 2019: GBP2.6m)
including a charge for share-based compensation of GBP0.2m (2019:
GBP0.1m). Operating expenses excluding share based compensation
were constant at GBP3.0m (2019: GBP3.0m) reflecting some reduction
in payroll costs offset by increased professional fees and business
development costs.
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. This amounted to GBP0.2m (2019: GBP0.1m)
and has no impact on cash flows.
Headcount
Average headcount of the Group for the year was 8 (2019: 8).
Taxation
The Group has elected to claim research and development tax
credits under the small or medium enterprise research and
development scheme of GBP0.45m (2019: GBP0.49m).
Share capital
A total of 321,600 ordinary shares of 0.25p each were issued
pursuant to exercises of share options granted under individual
share option grants. These options had exercise prices 0.875p per
share.
A share placing was completed in May 2019 which raised GBP5m
before expenses in difficult market conditions. This provides us
with a strengthened balance sheet, the resources to undertake
product formulation that will facilitate the next mBC trial and
other investigator-led clinical studies, and funds to complete
further toxicology studies that will remove current restrictions on
the duration of clinical trial treatment phases. The placing
comprised the issue of 33,333,329 ordinary shares of 0.25p each to
existing and new shareholders at 15.0p per share.
Cash flows and financial position
The cash position at 31 March 2020 increased to GBP4.1m (31
March 2019: GBP2.0m). The remaining clinical expenditure on the two
phase II trials of SFX-01, the costs of the tox and product
formulation projects, and recurring general and administrative
costs were offset by the share placing proceeds (GBP5.0m before
expenses) and receipt of the 2019 tax credit (GBP0.49m).
COVID-19 pandemic
The Board is monitoring the impact of COVID-19 on the Group and
its staff closely. To date, the impact on our staff and programmes
has been limited, however continuation of the pandemic for a
sustained period of months may affect:
-- Our ability to raise further finance as a consequence of a depressed funding environment
-- Our ability to conduct and conclude partnering discussions
-- Our ability to initiate and execute new clinical trials,
whether sponsored by Evgen or Clinical Investigators
-- Completion of the current toxicology and product formulation programmes to agreed timelines
OUTLOOK
We look forward to completing our key toxicology and formulation
work and the initiation of new clinical trials on SFX-01 in new
indications. We believe that the value of SFX-01 as a potential
drug active in each of the Nrf2 and STAT3 pathways will become
increasingly clear and the considerable commercial opportunity this
represents recognised. We will also continue to explore the
opportunities for monetising our assets in non- pharmaceutical
markets.
Barry Clare
Executive Chairman
12 June 2020
Consolidated Statement of Comprehensive Income
for the year ended 31 March 2020
Year ended Year ended
31 March 31 March
2020 2019
Notes GBP'000 GBP'000
--------------------------------------------- ------ ----------- -----------
Operating expenses
Operating expenses (2,998) (2,985)
Share based compensation 4 (168) (135)
--------------------------------------------- ------ ----------- -----------
Total operating expenses (3,166) (3,120)
--------------------------------------------- ------ ----------- -----------
Operating loss (3,166) (3,120)
--------------------------------------------- ------ ----------- -----------
Loss on ordinary activities before
taxation (3,166) (3,120)
Taxation 451 496
--------------------------------------------- ------ ----------- -----------
Loss and total comprehensive expense attributable
to equity holders
of the parent for the year (2,715) (2,624)
----------------------------------------------------- ----------- -----------
Loss per share attributable to equity
holders of the parent (pence) 5
Basic loss per share (2.10) (2.74)
Diluted loss per share (2.10) (2.74)
--------------------------------------------- ------ ----------- -----------
Consolidated Statement of Financial Position
as at 31 March 2020
Group
As at As at
31 March 31 March
2020 2019
Notes GBP'000 GBP'000
---------------------------------- ------ --------- ---------
ASSETS
Non-current assets
Property, plant and equipment 2 6
Intangible assets 82 98
Investments in subsidiary
undertaking - -
---------------------------------- ------ --------- ---------
Total non-current assets 84 104
Current assets
Trade and other receivables 196 135
Current tax receivable 446 492
Cash and cash equivalents 4,131 2,033
---------------------------------- ------ --------- ---------
Total current assets 4,773 2,660
---------------------------------- ------ --------- ---------
Total assets 4,857 2,764
---------------------------------- ------ --------- ---------
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables 653 688
---------------------------------- ------ --------- ---------
Total current liabilities 653 688
---------------------------------- ------ --------- ---------
Equity
Ordinary shares 6 331 247
Share premium 17,831 13,240
Merger reserve 2,067 2,067
Share based compensation 1,890 1,722
Retained deficit (17,915) (15,200)
---------------------------------- ------ --------- ---------
Total equity attributable
to equity holders of the parent 4,204 2,076
---------------------------------- ------ --------- ---------
Total liabilities and equity 4,857 2,764
---------------------------------- ------ --------- ---------
Consolidated Statement of Changes in Equity
for the year ended 31 March 2020
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
2018 233 12,560 2,067 1,587 (12,576) 3,871
Total comprehensive
expense for the period - - - - (2,624) (2,624)
Transactions with owners
Share issue - cash 14 668 - - - 682
Share issue - options
exercised - 12 - - - 12
Share based compensation
- share options - - - 135 - 135
--------------------------
Total transactions
with owners 14 680 - 135 - 829
-------------------------- --------- -------- -------- ------------- --------- --------
Balance at 31 March
2019 247 13,240 2,067 1,722 (15,200) 2,076
-------------------------- --------- -------- -------- ------------- --------- --------
Total comprehensive
expense for the period - - - - (2,715) (2,715)
Transactions with owners
Share issue - cash 83 4,589 - - - 4,672
Share issue - options
exercised 1 2 - - - 3
Share based compensation
- share options - - - 168 - 168
-------------------------- --------
Total transactions
with owners 84 4,591 - 168 - 4,843
-------------------------- --------- -------- -------- ------------- --------- --------
Balance at 31 March
2020 331 17,831 2,067 1,890 (17,915) 4,204
-------------------------- --------- -------- -------- ------------- --------- --------
Consolidated Statements of Cash Flows
for the year ended 31 March 2020
Group
Year ended Year ended
31 March 31 March
2020 2019
GBP'000 GBP'000
----------------------------------- ----------- -----------
Cash flows from operating
activities
Loss before taxation (3,166) (3,120)
Depreciation and amortisation 21 21
Share based compensation 168 135
----------------------------------- ----------- -----------
(2,977) (2,964)
Changes in working capital
(Increase)/decrease in trade
and other receivables (61) (58)
(Decrease)/increase in trade
and other payables (35) 299
----------------------------------- ----------- -----------
Cash used in operations (96) 241
Taxation received 497 436
----------------------------------- ----------- -----------
Net cash used in operating
activities (2,576) (2,287)
Cash flows (used in)/generated
from investing activities
Acquisition of tangible fixed
assets (1) -
----------------------------------- ----------- -----------
Net cash (used in)/generated
from investing activities (1) -
Cash flows from financing
activities
Proceeds from issue of shares 5,003 761
Issue costs (328) (67)
----------------------------------- -----------
Net cash generated from financing
activities 4,675 694
----------------------------------- ----------- -----------
Movements in cash and cash
equivalents in the period 2,098 (1,593)
----------------------------------- ----------- -----------
Cash and cash equivalents
at start of period 2,033 3,626
----------------------------------- ----------- -----------
Cash and cash equivalents
at end of period 4,131 2,033
----------------------------------- ----------- -----------
1. General information
Evgen Pharma plc ('the Company') is a public limited company
incorporated in England & Wales and was admitted to trading on
the AIM market of the London Stock Exchange under the symbol EVG on
21 October 2015. The address of its registered office is Liverpool
Science Park Innovation Centre 2, 146 Brownlow Hill, Liverpool,
Merseyside L3 5RF. The principal activity of the Company is
clinical stage drug development.
2. Basis of preparation
The financial information for the year ended 31 March 2019 has
been extracted from the Group's audited financial statements which
were approved by the Board of Directors on 12 June 2019 and which
have been delivered to the Registrar of Companies for England and
Wales. The report of the auditor on these 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 report of the auditor on the 31 March 2020 financial
statements was unqualified, did not contain a statement under
Section 498(2) or Section 498(3) of the Companies Act 2006 but did
include a matter to which the auditors drew attention by way of
emphasis without qualifying their report relating to the basis of
preparation which is reproduced below:
'Material uncertainty relating to going concern
We draw attention to note 2 in the financial statements
concerning the group's ability to continue as a going concern. The
going concern status of the group is dependent upon the management
of the timing of settlement of its liabilities and the raising of
further funds in the short to medium term. Forecasts prepared by
management indicate that if they are unable to manage the group's
liabilities or the external fund raising does not occur in the
short to medium term they would have a requirement to seek
alternative sources of funding, As stated in note 2, these events
or conditions, along with other matters set forth in note 2,
indicate that a material uncertainty exists which may cast doubt on
the group's ability to continue as a going concern. Our opinion is
not modified in respect of this matter.'
The information included in this preliminary announcement has
been prepared on a going concern basis under the historical cost
convention, and in accordance with International Financial
Reporting Standards (IFRSs) as adopted by the EU and the
International Financial Reporting Interpretations Committee (IFRIC)
interpretations issued by the International Accounting Standards
Board ("IASB") that are effective or issued and early adopted as at
the date of these financial statements and in accordance with the
provisions of the Companies Act 2006.
The information in this preliminary statement has been extracted
from the audited financial statements for the year ended 31 March
2020 and as such, does not contain all the information required to
be disclosed in the financial statements prepared in accordance
with the International Financial Reporting Standards ('IFRS').
This announcement was approved by the board of directors and
authorised for issue on 12 June 2020.
3. Going concern
At 31 March 2020, the Group had cash and cash equivalents,
including short-term investments and cash on deposit, of GBP4.13
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 to around the end of June 2021. The Directors
are continuing to explore sources of finance available to the Group
and have confidence that they will be able to secure sufficient
cash inflows for the Group to continue its activities to the end of
calendar 2021 and therefore for not less than 12 months from the
date of approval of these financial statements; they have therefore
prepared the financial statements on a going concern basis. Because
the additional finance is not committed at the date of approval of
these financial statements, these circumstances represent a
material uncertainty as to the Group's ability to continue as a
going concern. Should the Group be unable to obtain further finance
such that the going concern basis of preparation were no longer
appropriate, adjustments would be required including to reduce
balance sheet values of assets to their recoverable amounts, to
provide for further liabilities that might arise and to reclassify
fixed assets as current assets.
4. Share based payment charge
During the years ended 31 March 2020 and 31 March 2019, 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 interest 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
2020 was GBP168,000 (year to 31 March 2019 GBP135,000).
5. 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.
For diluted loss per share, the loss for the year attributable
to equity holders and the weighted average number of ordinary
shares outstanding during the year is adjusted to assume conversion
of all dilutive potential ordinary shares.
As at 31 March 2020 the Group had 9,531,367 (2019: 9,075,599)
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
2020 2019
GBP'000 GBP'000
Loss for the year attributable to equity holders
for basic loss and adjusted for the effects
of dilution (2,715) (2,624)
-------------------------------------------------- ----------- -----------
Year ended Year ended
31 March 31 March
2020 2019
Number Number
Weighted average number of ordinary shares
for basic loss per share 129,315,418 95,857,230
-------------------------------------------- ------------ -----------
Effects of dilution:
Share options - -
Weighted average number of ordinary shares
adjusted for the effects of dilution 129,315,418 95,857,230
-------------------------------------------- ------------ -----------
Year ended Year ended
31 March 31 March
2020 2019
Pence Pence
Loss per share - basic and diluted (2.10) (2.74)
------------------------------------ ----------- -----------
The loss and the weighted average number of ordinary shares for
the years ended 31 March 2019 and 2020 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.
6. Issued capital and reserves
Ordinary shares
Company
Ordinary shares of 0.25p each Share Capital
Number GBP'000
At 31 March 2019 98,991,334 247
-------------------------------- ------------ --------
Issued on exercise of options 321,600 1
Issued under placing agreement 33,333,329 83
At 31 March 2020 132,646,263 331
-------------------------------- ------------ --------
On 8 May 2019 33,333,329 ordinary shares were issued at a price
of GBP0.15 raising GBP5.0 million which after share issue expenses
of GBP0.3 million gave net consideration of GBP4.7 million.
On 20 May 2019 321,600 ordinary shares were issued in connection
with the exercise of share options at an exercise price of 0.875
pence per share payable in cash.
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 2020 and 2019 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.
7. Related party transactions
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 2020, the Group purchased
services totalling GBP155,514 (year ended 31 March 2019:
GBP131,661) from The Clinical Trial Company Limited, a company of
which Richard Moulson, a Director, was a director until 31(st)
December 2019. The amount owed to The Clinical Trial Company
Limited at 31 March 2020 was GBPnil (31 March 2019: GBP13,922).
During the year ended 31 March 2019, the Group purchased
consultancy services totalling GBP1,800 from Dr Alan Barge, a
Director, there were no services purchased from Dr Alan Barge
during the year ended 31 March 2020. The amount owed to Dr Alan
Barge at 31 March 2020 was GBPnil (31 March 2019: GBPnil).
During the year ended 31 March 2020, the Group purchased
consultancy services totalling GBP15,069 (year ended 31 March 2019:
GBP14,950) from FD Consult Ltd, a company controlled by Richard
Moulson. The amount owed to FD Consult Ltd at 31 March 2020 was
GBPnil (31 March 2019: GBPnil).
During the year ended 31 March 2020, the Group was not charged
any monitoring and Director fees totalling relating to Marc
d'Abbadie's services (year ended 31 March 2019: GBP15,986) by SPARK
Impact Limited, manager of North West Fund for Biomedical, a
shareholder. The amount owed to SPARK Impact, manager of North West
Fund for Biomedical at 31 March 2020 was GBPnil (31 March 2019:
GBPnil).
8. Report and accounts
A copy of the Annual Report and Accounts will shortly be sent to
all shareholders with notice of the Annual General Meeting and will
also be available to download from the Group's website at
www.evgen.com .
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR EASKAFFEEEFA
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