TIDMTRX
RNS Number : 5263V
Tissue Regenix Group PLC
29 October 2014
Tissue Regenix Group plc
("Tissue Regenix" or "the Group")
Unaudited Interim Results for the six months ended 31 July
2014
YORK, 29(th) October 2014 - Tissue Regenix, the regenerative
medical devices company which uses animal or human tissue to
replace damaged or worn out parts of the human body, today
announces its unaudited interim results for the six months ended 31
July 2014.
Operational Highlights
During the period, the Group has achieved the following
milestones:
-- Wound Care
o Continued to make good progress in the execution of its
strategy to commercialise its range of regenerative medicine
products based on the dCELL(R) process, including the successful
launch of its decellularised dermal allograft product
("DermaPure(R)") in the USA. The launch of DermaPure(R) in the USA
allows Tissue Regenix to target the $1.4 billion a year market for
skin substitutes
o As a core part of the Group's marketing efforts, Tissue
Regenix USA has also developed an initial distribution network
covering in excess of 80% of the USA, currently focused on
promoting DermaPure(R)
o Received a preliminary positive decision from the Centers for
Medicare & Medicaid Services (CMS) for the assignment of a
permanent Healthcare Common Procedure Coding System (HCPCS) Q-code
for DermaPure(R), allowing for wound care centre reimbursement for
the product, expected from January 2015 onwards
o Progressed its US diabetic foot ulcer human clinical trial to
support commercial activity
-- Orthopaedics
o Gained approval from the Medicines and Healthcare Products
Regulatory Agency (MHRA) to start the first UK clinical trial of
its dCELL(R) meniscal device to aid knee repairs, a critical step
towards gaining EU clearance (and a CE Mark) to enable full
commercialisation of the dCELL(R) meniscus product
-- IP
o Received a number of patents for its global exclusive licence
portfolio covering the use of its dCELL(R) technology, including a
patent to aid meniscal repair in China, and patents for use in
bladder repair in both Europe and the USA
Financial Highlights
-- Expected loss after tax of GBP3.4m for the first half of 2014
(H1 2013: GBP2.1m) resulting from additional development
expenditure and establishing the commercial operations in the
USA
-- Cash and cash equivalents of GBP14.6m as of 31 July 2014 (H1 2013: GBP21.7m)
Antony Odell, CEO of Tissue Regenix Group plc commented: "Tissue
Regenix has achieved much in the past six months including starting
the commercial roll-out of our dCELL(R) DermaPure(R)product in the
USA; gaining approval from the MHRA for a UK clinical trial on
dCELL(R) meniscus products; progressing our diabetic foot ulcer
trial in the US and increasing our global patent portfolio.
"These milestones maintain our planned progress and build
successfully on our strategic focus on the wound care and
orthopaedic markets, following the positive data from the UK
clinical trial into dCELL(R) dermis patches, and our decision to
commercialise this product in the USA in 2013. The launch of
DermaPure(R) as our first product in the USA represents a
significant step for the Group.
"For the orthopaedic business, gaining approval to start our
human clinical trial on porcine dCELL(R) meniscus provides a
foundation for securing a CE mark in the UK. This represents a
critical step in the process to enable full commercialisation of
the dCELL(R) meniscus product and allow it to be used by clinics
and doctors to help UK and European patients."
A capital markets update presentation for analysts and investors
will be held today, Wednesday 29(th) October, between 9.30am and
11am at Jefferies International, 68 Upper Thames Street, London,
EC4V 3BJ. The presentation will contain no new material
information. If you would like to attend, please contact Deborah
Saw or Andrew Adie on +44 (0) 207 680 6550 or
TR@newgatecomms.com
For further information, please contact:
Tissue Regenix Group plc: +44 (0) 19 0443 5176
Antony Odell
Ian Jefferson
Jefferies International Ltd. +44 (0) 20 7029 8000
Simon Hardy
Harry Nicholas
Newgate Communications +44 (0) 207 680 6550
Deborah Saw
Andrew Adie
About Tissue Regenix
Tissue Regenix is a leading medical devices company in the field
of regenerative medicine. The company's patented decellularisation
('dCELL(R)') technology removes DNA and other cellular material
from animal and human tissue leaving an acellular tissue scaffold
which is not rejected by the patient's body which can then be used
to repair diseased or worn out body parts. The potential
applications of this process are diverse and address many critical
clinical needs such as vascular disease, heart valve replacement
and knee repair.
Tissue Regenix was formed in 2006 when it was spun-out from the
University of Leeds. The company commercialises academic research
conducted by our partners around the World.
In November 2012 Tissue Regenix Group plc set up a subsidiary
company in the United States - 'Tissue Regenix Wound Care Inc.', as
part of its commercialisation strategy for its dCELL(R) technology
platform.
Chairman's Statement
Overview
The first half of 2014 has arguably been the most exciting
period in the Group's short history, with the successful commercial
launch of DermaPure(R) in the USA, which allows us to target a
market worth $1.4 billion a year.
During the period we have focused heavily on developing our
marketing and sales strategy and successfully implementing these
plans in the USA. Tissue Regenix has formed an initial number of
commercial partnerships to enable distribution of the product in
the USA.
Alongside the developments in wound care, the Group has also
made steady progress in other areas of the business, including
preparations for the European trial of the dCELL(R) meniscus in
orthopaedics, and the attainment of a number of patents to protect
our unique dCELL(R) technology.
Wound care
The launch of DermaPure(R) in the USA represents a key
opportunity for the Group. Tissue Regenix's DermaPure(R) was shown
in the UK human clinical trial to be easily administered, and can
be stored at room temperature, removing the need for expensive
freezing or cryopreservation. DermaPure(R), which is processed by
our tissue bank partners Community Tissue Services ("CTS"), is
initially being aimed at helping patients with diabetic foot
ulcers, a condition which affects around 600,000 people in the USA
each year, and patients with venous leg ulcers, which currently
affect around 2.5 million people in the USA.
Tissue Regenix also received a preliminary positive decision for
an assignment of a permanent Healthcare Common Procedure Coding
System (HCPCS) "Q-code" for DermaPure(R), which from January 2015
will allow Tissue Regenix to apply for wound care centre
reimbursement of the product from local payer organisations. Payer
organisations worldwide are focused on managing the gap between
funding and medical costs, often in the context of a changing
regulatory environment. Whilst these applications will take time to
be processed the decision will allow greater access to DermaPure(R)
for clinicians and provide an advanced treatment for patients with
chronic (and potentially acute) wounds. To support this marketing
activity, the Group also progressed the human clinical trial for
diabetic foot ulcers.
In the United Kingdom, NHSBT has continued to roll out
DermaPure(R) (known as dCELL(R) Human Dermis) in the period
following its launch in January 2014.
Orthopaedics
In July 2014 the Group received approval from the Medicines and
Healthcare Products Regulatory Agency (MHRA) to start the first UK
human clinical trial of its dCELL(R) meniscal device to aid knee
repairs, expected to commence before the end of the calendar year.
The trial approval marks a key milestone towards gaining EU
clearance (and a CE Mark) which will enable full commercialisation
of the dCELL(R) meniscus product, allowing it to be used by clinics
and doctors to help UK and European patients. Meniscal injuries
affect around 1.5 million people per year in the USA and Europe,
with 61 people sustaining a meniscal tear per 100,000 population
per year in the UK alone, and the dCELL(R) meniscus potentially
addresses this substantial unmet clinical need.
IP protection
The Group's IP estate continued to develop with a number of
patents granted in the period covering the use of Tissue Regenix
technology in a range of applications. These include patents to aid
meniscal repair in China and for use in bladder repair in the USA
and Europe. Tissue Regenix will continue to apply for similar
patents worldwide to protect the Group's dCELL(R) technology.
Financial Review
As previously stated, Tissue Regenix has continued to make
investments in product development to drive growth during the
period and has maintained a robust cash position of GBP14.6m at the
end of the first half (H1 2013: GBP21.7m). As planned, we expect to
continue to use our cash resources to fund our development
programmes, and expect cash utilisation to increase over the coming
years as the programmes progress through pre-clinical and clinical
trials.
Outlook
The launch of DermaPure(R) in the USA during the first six
months of 2014 was an important milestone in Tissue Regenix's
progress from its roots as a purely development-focused company to
becoming a business with commercially available products. We are
committed to bringing our pipeline of human and animal tissue
products to market, to meet a range of clinical needs. Our focus on
accelerating the delivery of our product pipeline and the upcoming
clinical trial for the first of our orthopaedic products shows that
we have the expertise and confidence to enter competitive but
attractive global markets. The diversity and strength of the
dCELL(R) platform coupled with our strong commercial focus provides
a solid base to grow the business and the Group will continue to
aim towards the full commercial rollout of our dCELL(R) technology
across a range of target markets, including multiple applications
where we see opportunity for DermaPure(R), working towards our
ambition to become a global leader in regenerative medicine.
John Samuel
Chairman
29 October 2014
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(UNAUDITED)
FOR THE SIX MONTHS TO 31 JULY 2014
6 months 6 months 12 months
to to to
Notes 31 July 31 July 31 Jan
2014 2013 2014
GBP'000 GBP'000 GBP'000
----------------------------------- -------- ---------- ---------- ----------
Revenue 8 3 6
Administrative expenses (3,835) (2,503) (6,583)
Operating loss (3,827) (2,500) (6,577)
Finance income 97 152 274
----------------------------------- -------- ---------- ---------- ----------
Loss before tax (3,730) (2,348) (6,303)
Taxation 3 300 200 710
----------------------------------- -------- ---------- ---------- ----------
Loss after tax attributable
to equity holders of the parent (3,430) (2,148) (5,593)
----------------------------------- -------- ---------- ---------- ----------
Other Comprehensive Income:
Foreign currency translation
differences - foreign operations - - 3
----------------------------------- -------- ---------- ---------- ----------
TOTAL COMPREHENSIVE EXPENSE
FOR THE YEAR (3,430) (2,148) (5,590)
----------------------------------- -------- ---------- ---------- ----------
Loss per share
Basic and diluted on loss from
continuing operations 4 (0.54)p (0.34)p (0.88)p
----------------------------------- -------- ---------- ---------- ----------
The loss for the period arises from the Group's continuing
operations.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(UNAUDITED)
FOR THE SIX MONTHS TO 31 JULY 2014
Share
Reverse Reserve Based Retained
Share Share Merger Acquisition for own Payment earnings Total
Capital Premium Reserve Reserve shares Reserve deficit Equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------ ---------- ---------- ---------- -------------- ---------- --------- ----------- ----------
At 31 Jan
2013 3,264 31,966 10,884 (7,148) (831) 536 (14,205) 24,466
Loss and
total
comprehensive
expense
for the
period - - - - - - (2,148) (2,148)
Share based
payment - - - - - 54 - 54
At 31 July
2013 3,264 31,966 10,884 (7,148) (831) 590 (16,353) 22,372
Loss for
the period - - - - - - (3,445) (3,445)
Other
comprehensive
income - - - - - - 3 3
------------------ ---------- ---------- ---------- -------------- ---------- --------- ----------- ----------
Loss and
total
comprehensive
expense
for the
period - - - - - - (3,442) (3,442)
Exercise
of share
options 3 5 - - - - - 8
Share based
payment - - - - - 40 - 40
------------------ ---------- ---------- ---------- -------------- ---------- --------- ----------- ----------
At 31 Jan
2014 3,267 31,971 10,884 (7,148) (831) 630 (19,795) 18,978
Loss and
total
comprehensive
expense
for the
period - - - - - - (3,430) (3,430)
Exercise
of share
options 4 1 - - - - - 5
Share based
payment - - - - - 90 - 90
------------------ ---------- ---------- ---------- -------------- ---------- --------- ----------- ----------
At 31 July
2014 3,271 31,972 10,884 (7,148) (831) 720 (23,225) 15,643
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(UNAUDITED)
AS AT 31 JULY 2014
31 July 31 July 31 Jan
Notes 2014 2013 2014
GBP'000 GBP'000 GBP'000
------------------------------- -------- --------- --------- ---------
Non-current assets
Property, plant and equipment 440 317 472
------------------------------- -------- --------- --------- ---------
Total non-current assets 440 317 472
------------------------------- -------- --------- --------- ---------
Current assets
Inventory 9 - -
Trade and other receivables 1,318 868 1,127
Cash and cash equivalent 14,578 21,671 18,483
------------------------------- -------- --------- --------- ---------
Total current assets 15,905 22,539 19,610
------------------------------- -------- --------- --------- ---------
Total assets 16,345 22,856 20,082
------------------------------- -------- --------- --------- ---------
Current liabilities
Trade and other payables (702) (484) (1,104)
------------------------------- -------- --------- --------- ---------
Total liabilities (702) (484) (1,104)
------------------------------- -------- --------- --------- ---------
Net assets 15,643 22,372 18,978
------------------------------- -------- --------- --------- ---------
Equity
Share capital 5 3,271 3,264 3,267
Share premium 5 31,972 31,966 31,971
Merger Reserve 5 10,884 10,884 10,884
Reverse acquisition reserve 5 (7,148) (7,148) (7,148)
Reserve for own shares (831) (831) (831)
Share based payment reserve 720 590 630
Retained earnings deficit 6 (23,225) (16,353) (19,795)
------------------------------- -------- --------- --------- ---------
Total equity 15,643 22,372 18,978
------------------------------- -------- --------- --------- ---------
Approved by the Board and authorised for issue on 29 October
2014
John Samuel (Executive Chairman) Ian Jefferson (Chief Financial Officer)
CONDENSED CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)
FOR THE SIX MONTHS ENDED 31 JULY 2014
6 months 6 months 12 months
to to to
Notes 31 July 31 July 31 Jan
2014 2013 2014
GBP'000 GBP'000 GBP'000
---------------------------------- --------- ---------- ---------- ----------
Operating Activities
Operating loss (3,827) (2,500) (6,577)
Adjustment for non-cash items:
Depreciation of property,
plant & equipment 76 54 124
Share based payment 90 54 94
Tax refunded - - 474
--------------------------------------------- ---------- ---------- ----------
Operating cash outflow (3,661) (2,392) (5,885)
--------------------------------------------- ---------- ---------- ----------
Increase in inventory (9) - -
Decrease/(increase) in trade
& other receivables 109 39 (184)
(Decrease)/increase in trade
& other payables (402) (201) 422
--------------------------------------------- ---------- ---------- ----------
Net cash outflow from operations (3,963) (2,554) (5,647)
--------------------------------------------- ---------- ---------- ----------
Investing activities
Interest received 97 152 274
Purchase of property, plant
& equipment (44) (133) (358)
--------------------------------------------- ---------- ---------- ----------
Net cash outflow from investing
activities 53 19 (84)
--------------------------------------------- ---------- ---------- ----------
Financing activities
Proceeds from issue of share
capital 5 - 8
Net cash inflow from financing
activities 5 - 8
--------------------------------------------- ---------- ---------- ----------
Decrease in cash and cash
equivalents (3,905) (2,535) (5,723)
Cash and cash equivalents
at start of period 18,483 24,206 24,206
--------------------------------------------- ---------- ---------- ----------
Cash and cash equivalents
at end of period 14,578 21,671 18,483
--------------------------------------------- ---------- ---------- ----------
NOTES TO THE CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE SIX MONTHS ENDED 31 JULY 2014
1. Basis of preparation
The interim financial information set out in this statement for
the six months ended 31 July 2014 and the comparative figures for
the six months ended 31 July 2013 are unaudited. This information
does not constitute statutory accounts as defined in Section 435 of
the Companies Act 2006.
The comparative figures for the financial year ended 31 January
2014 are not the Company's statutory accounts for that financial
year. Those accounts have been reported on by the Company's
auditors and delivered to the Registrar of Companies. The report of
the auditor was (i) unqualified, (ii) did not include a reference
to any matters to which the auditor drew attention by way of
emphasis without qualifying their report, and (iii) did not contain
a statement under section 498 (2) or (3) of the Companies Act
2006.
This interim statement, which is neither audited nor reviewed,
has been prepared in accordance with the measurement and
recognition criteria of Adopted IFRSs. It does not include all the
information required for the full annual financial statements, and
should be read in conjunction with the financial statements of the
Group as at and for the year ended 31 January 2014. It does not
comply with IAS 34 "Interim Financial Reporting" as is permissible
under the rules of the AIM Market ("AIM").
The accounting policies applied in preparing these interim
financial statements are the same as those applied in the
preparation of the annual financial statements for the year ended
31 January 2014, as described in those financial statements other
than standards, amendments and interpretations which became
effective after 1 February 2014 and were adopted by the Group.
These have had no significant impact on the Group's profit for the
period or equity. The Board approved these interim financial
statements on 26 September 2014.
2. Significant accounting policies
The condensed consolidated financial statements have been
prepared under the historical cost convention in accordance with
International Financial Reporting Standards as adopted by the
European Union.
The accounting policies adopted are consistent with those
followed in the preparation of the audited financial statements of
Tissue Regenix Group Plc for the year ended 31 January 2014 and are
disclosed in those statements.
NOTES TO THE CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
continued
FOR THE SIX MONTHS ENDED 31 JULY 2014
3. Taxation
6 months 6 months 12 months
to to to
31 July 31 July 31 Jan
2014 2013 2014
GBP'000 GBP'000 GBP'000
---------------------------------- --------- --------- ----------
Current Tax:
Tax credit on research and
development costs in the period 300 200 710
300 200 710
Deferred tax:
Origination and reversal of
temporary timing differences - - -
---------------------------------- --------- --------- ----------
Tax credit on loss on ordinary
activities 300 200 710
---------------------------------- --------- --------- ----------
The Group has accumulated losses available to carry forward
against future trading profits. No deferred tax asset has been
recognised in respect of tax losses.
4. Loss per share (basic and diluted)
Basic loss per share is calculated by dividing the loss
attributable to equity holders of the parent by the weighted
average number of ordinary shares in issue during the period
excluding own shares held jointly by the Tissue Regenix Employee
Share Trust and certain employees. Diluted loss per share is
calculated by adjusting the weighted average number of ordinary
shares in issue during the period to assume conversion of all
dilutive potential ordinary shares.
6 months 6 months 12 months
to to to
31 July 31 July 31 Jan
2014 2013 2014
GBP'000 GBP'000 GBP'000
---------------------------------- -------------- -------------- --------------
Total loss attributable to
the equity holders of the
parent (3,430) (2,148) (5,593)
---------------------------------- -------------- -------------- --------------
No. No. No.
---------------------------------- -------------- -------------- --------------
Weighted average number of
ordinary shares in issue during
the period 636,592,627 635,515,678 635,574,603
---------------------------------- -------------- -------------- --------------
Loss per share
Basic and diluted on loss
for the period (0.54)p (0.34)p (0.88)p
---------------------------------- -------------- -------------- --------------
The Company has issued employees options over 22,756,940
ordinary shares and there are 16,940,386 jointly owned shares which
are potentially dilutive. There is, however, no dilutive effect of
these issued options as there is a loss for each of the periods
concerned.
NOTES TO THE CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
continued
FOR THE SIX MONTHS ENDED 31 JULY 2014
5. Share capital
Reverse
Share Share Merger acquisition
Capital Premium Reserve reserve Total
Number GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- -------------- ---------- ---------- ---------- ------------- ----------
Total Ordinary shares
of 0.5p each as at
31 January 2013 652,825,019 3,264 31,966 10,884 (7,148) 38,966
Issued on exercise
of share options - - - - - -
Total Ordinary shares
of 0.5p each as at
31 July 2013 652,825,019 3,264 31,966 10,884 (7,148) 38,966
Issued on exercise
of share options 662,338 3 5 - - 8
Total Ordinary shares
of 0.5p each as at
31 January 2014 653,487,357 3,267 31,971 10,884 (7,148) 38,974
Issued on exercise
of share options 635,674 4 1 - - 5
Total Ordinary shares
of 0.5p each as at
31 July 2014 654,123,031 3,271 31,972 10,884 (7,148) 38,979
6. Movement in retained earnings and reserve for own shares
Retained Reserve
Earnings For Own
Deficit Shares
GBP'000 GBP'000
--------------------- ---------- ---------
At 31 January 2013 (14,205) (831)
Loss for the period (2,148) -
--------------------- ---------- ---------
At 31 July 2013 (16,353) (831)
Loss for the period (3,445) -
Exchange movement 3 -
--------------------- ---------- ---------
At 31 January 2014 (19,795) (831)
Loss for the period (3,430) -
--------------------- ---------- ---------
At 31 July 2014 (23,225) (831)
--------------------- ---------- ---------
7. Interim financial report
A copy of this interim report will be distributed to
shareholders and is also available on the Company's website at
www.tissueregenix.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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