Verona Pharma
plc
("Verona Pharma" or the
"Company")
Financial results
for the year ended 31 December
2015
A year
of significant clinical progress
03 June 2016, Cardiff – Verona Pharma plc (AIM: VRP.L),
the drug development company focused on first-in-class medicines to
treat respiratory diseases, today announces its audited results for
the twelve months ended 31 December
2015.
2015 OPERATIONAL HIGHLIGHTS
· Completed a series of successful
clinical trials with a novel proprietary suspension formulation for
nebulisation of RPL554
o a Phase I/IIa Single Ascending Dose/Multiple Ascending
Dose (SAD/MAD) study in 80 healthy subjects and in 32 COPD patients
(study 007)
o a Phase IIa dose-finding study in 29 asthma patients
(study 008)
o a Phase IIa study examining the effect of adding RPL554
to standard doses of common bronchodilator drugs in 30 COPD
patients (study 009)
· New clinical data obtained in
>170 subjects with the new suspension formulation of RPL554
strongly supports its continued development
o Studies continue to demonstrate the excellent
bronchodilator properties of RPL554
o Formulation is much better tolerated than the earlier
solution formulation prototype, with no maximum tolerated dose
observed even at 16 times the active bronchodilator dose
o New formulation is suitable for twice daily dosing
o Formulation provides for a longer pulmonary residence
time, lower peak plasma exposure and longer half-life in blood than
the earlier formulation suggesting a more pronounced effect locally
in the lung and comparatively less effects in other organs in the
body
· Data published at the North
America Cystic Fibrosis Conference and in a peer-reviewed
scientific journal demonstrates that RPL554 enhances
CFTR1 activation, suggesting its potential use in cystic
fibrosis patients
· Filed multiple patents on RPL554
to extend IP coverage beyond 2030
· Appointed Dr Ken Newman as Chief Medical Officer, and Dr
Ken Cunningham and Dr Anders Ullman as Non-Executive Directors of the
Board
2015 FINANCIAL HIGHLIGHTS
· Loss after tax of £7.42m (2014:
£2.76m) broadly in line with market expectations, reflecting tight
cost control despite the planned increase in R&D spend
especially on clinical studies
· Loss per share of 0.73 pence (2014: 0.32
pence)
· Net cash outflows from operating
activities during the year of £6.35m (2014: £3.54m) reflecting
clinical progress, with cash and cash equivalents as at
31 December 2015 of £3.52m (2014:
£9.97m)
POST PERIOD
· Positive headline data from
RPL554 Phase IIa dose-finding study in asthma patients demonstrates
substantial bronchodilator effect and excellent tolerability at
broad range of doses
o Data suggests drug could be meaningful new addition,
alone or in combination, for the treatment of COPD
· Positive headline data from
RPL554 Phase IIa add-on study demonstrates a highly significant and
clinically meaningful additional bronchodilator effect when RPL554
is administered on top of standard doses of the commonly used
bronchodilators salbutamol and ipratropium bromide
o The combination of RPL554 with salbutamol or ipratropium
bromide caused a significant reduction in trapped air in the lung
(residual volume) as compared to salbutamol or ipratropium bromide
alone
§ Suggesting that RPL554 treatment may
reduce dyspnea, a major debilitating symptom of COPD
o Consistent with previous studies, RPL554 was well
tolerated both alone and in combination
§ No effect on vital signs or ECG
parameters
§ No gastro-intestinal adverse events
recorded
Dr. Jan-Anders Karlsson, CEO of
Verona Pharma, commented:
“During the year Verona Pharma made substantial clinical
progress with its lead compound, RPL554, further highlighting its
potential to be an important novel and complementary treatment
option for patients with COPD and other respiratory diseases. To
date, over 275 subjects have been included in clinical trials with
RPL554, which have consistently shown that the drug is well
tolerated, generating highly significant and clinically meaningful
data.
COPD affects over 300 million people worldwide and to date there
has been limited true innovation in developing better medicines for
this debilitating and progressive disease. The Board continues to
believe that RPL554, with its novel mode of action, represents a
very attractive commercial opportunity for generating significant
value for shareholders.”
1 Cystic fibrosis transmembrane conductance regulator
(CFTR) is the membrane protein and chloride ion channel which is
dysfunctional in cystic fibrosis patients and responsible for their
respiratory symptoms
-ENDS-
About Verona Pharma
Verona Pharma's lead drug, RPL554, is a first-in-class drug
currently in Phase II trials as a nebulised treatment for acute
exacerbations of COPD in the hospital setting. The drug is a
dual phosphodiesterase (PDE) 3/4 inhibitor and therefore has both
bronchodilator and anti-inflammatory effects, which are essential
to the improvement of patients with COPD and asthma.
Verona Pharma is also building a broader portfolio of
RPL554-containing products to maximise its benefit to patients and
its value. This includes the very significant markets for COPD
and asthma maintenance therapy. In addition, the Company is
exploring the potential of the drug in different diseases, such as
cystic fibrosis, where it is in pre-clinical testing and has
received a Venture and Innovation Award from the UK Cystic Fibrosis
Trust.
For further information, please
contact:
Verona Pharma plc |
Tel: +44 (0)20 3283 4200 |
Jan-Anders Karlsson, CEO |
|
N+1 Singer |
Tel: +44 (0)20 7496 3000 |
Aubrey Powell / Jen
Boorer |
|
FTI Consulting |
Tel: +44 (0)20 3727 1000 |
Simon Conway /
Stephanie Cuthbert /
Natalie Garland-Collins |
|
CHAIRMAN AND CHIEF EXECUTIVE OFFICER’S
JOINT STATEMENT
INTRODUCTION
Verona Pharma is a specialist pharma company developing
first-in-class drugs for patients with chronic, debilitating
respiratory diseases that are not adequately treated by existing
medicines. The Company’s strategy is to accelerate shareholder
value creation, by focusing its resources on its lead programme
RPL554, an innovative inhaled, dual phosphodiesterase (PDE) 3 and 4
inhibitor, as a nebulised treatment for patients in hospital with
acute exacerbations of chronic obstructive pulmonary disease (COPD)
to facilitate and speed up recovery and reduce the risk of early
recurrence of symptoms and re-hospitalisation after discharge from
hospital. Many of these patients become hospitalised as a result of
an acute worsening of their disease that cannot be prevented or
properly treated by their current medications and they are
therefore in need of more intensive care and treatment. RPL554’s
unique and very attractive properties, being both an effective
bronchodilator and anti-inflammatory agent in the same compound,
should be beneficial to these patients. In addition, the Company is
exploring the use of nebulised RPL554 in maintenance treatment of
COPD patients with moderate to severe disease. RPL554’s unique
properties could also translate into activity in other respiratory
disorders including cystic fibrosis and asthma.
The Company is also currently exploring the potential of the
drug in cystic fibrosis, where it is in pre-clinical testing.
Cystic fibrosis is a genetic disease with a shortened lifespan in
need of new and effective treatments. In addition, RPL554 delivered
in a Dry Powder Inhaler (DPI) or Metered Dose Inhaler (MDI) device
could be beneficial as a chronic maintenance treatment for patients
with COPD and subsequently in asthma, although such development is
longer and more costly compared to that required for the
development of a nebulised formulation and would therefore
ultimately require a collaboration with a larger partner to
complete the required larger scale clinical trials and subsequent
commercialisation.
RPL554 provides an opportunity to treat patients with
respiratory diseases that are not optimally treated with currently
available drugs. The Board believes there is no other compound
which demonstrates RPL554’s unique mechanism of action, or any
other novel type of bronchodilator currently in clinical
development. The yearly market for nebulised bronchodilators in the
US is about $1 billion1
providing a very attractive commercial opportunity. Additionally,
the cystic fibrosis market (expected to grow to > $5billion in 2018; GlobalData July 2014) and the market for maintenance
treatment of COPD patients (worldwide COPD market to reach
>$13bn by 2020; Evaluate Pharma
Sept 2015) with a DPI/MDI are very
large and provide significant upside sales potential for
RPL554.
2015 YEAR IN REVIEW
During 2015, the Company completed a series of clinical trials
with the new proprietary suspension formulation of RPL554 for use
in a nebuliser. The first Phase I/IIa clinical trials with the new
formulation of RPL554 started in December
2014 at Medicines Evaluation Unit, Manchester, UK and completed around mid-year.
Based on the positive data from the initial Single Ascending Dose
(SAD) part of this study, the Board decided to accelerate
development of RPL554. Consequently, two additional Phase IIa
trials completed their clinical phases before year end 2015.
Top-line data from the asthma study was reported in March 2016 and the data from the second study in
COPD patients was reported in May
2016. Both studies met their primary endpoints and reported
very positive efficacy data together with the observation that
RPL554 was well tolerated in both studies.
Verona Pharma strengthened its senior management team with a new
CMO, Dr Kenneth Newman from
January 2015. Two Non-Executive
Directors, Dr Ken Cunningham and Dr
Anders Ullman, two physicians highly
experienced in the development of respiratory medicines, were
appointed to the Company’s Board of Directors in September 2015. Verona Pharma also listed its
shares on the Frankfurt Xetra exchange (part of Deutsche Börse in
Germany) to facilitate trading for
investors located outside of UK.
Verona Pharma continued to investigate RPL554 in pre-clinical
models of cystic fibrosis, providing further evidence for RPL554
activating the ion channel (CFTR, cystic fibrosis transmembrane
conductance regulator) that is dysfunctional in cystic fibrosis
patients and responsible for their respiratory symptoms. Improving
the functioning of this ion channel may enhance mucociliary
clearance in the airways of these patients and improve their lung
function. This work was supported by an Award from the Cystic
Fibrosis Trust, UK. The new data in cystic fibrosis was presented
in Phoenix, US, in October, and
published in a peer-reviewed manuscript in American Journal of
Physiology in November 2015, further
enhancing the profile of RPL554.
Additionally, the Company filed a number of patent applications
on RPL554, including a patent on the new suspension formulation, to
further strengthen the patent portfolio and extend the patent life
of the compound beyond 2030.
1 IMS Consulting Group market research 2014
RPL554
RPL554 is a novel inhaled dual PDE3/PDE4 inhibitor that was
selected for clinical development following pre-clinical studies
that demonstrated both potent bronchodilator and anti-inflammatory
properties. To these properties a potential effect directly on
mucociliary clearance can also be added. RPL554 is currently being
developed as a very promising first-in-class treatment for patients
with chronic respiratory diseases such as COPD and potentially
cystic fibrosis as both diseases are characterised by obstructed
airways, chronic inflammation of the lung and impaired mucociliary
clearance. Future studies may also indicate a potential role in the
treatment of asthmatics.
With the original proof-of-concept solution formulation for
nebulisation, the Company successfully completed a number of early
Phase I and II clinical studies with RPL554 in over 100 subjects.
Data demonstrated that the compound is a potent bronchodilator in
human subjects. As the bronchodilator response is rapid in onset,
cost-effective single-dose studies could be performed.
Anti-inflammatory effects of RPL554 in a human model of COPD-like
inflammation were examined after six days of treatment with the
original solution formulation of the compound before subjects were
challenged on the last day by an irritant agent that provokes a
COPD-like inflammatory response in their airways. RPL554
significantly reduced the number of neutrophils (an inflammatory
cell type recognised for its central role in COPD, cystic fibrosis
and severe asthma) together with all other cell types such as
eosinophils, lymphocytes and macrophages in the sputum. These data
indicate that RPL554 has anti-inflammatory properties, most likely
due to inhibition of PDE4 (or perhaps the combined inhibition of
PDE3 and PDE4; Lancet Resp Med 2013*).
To date, RPL554 has been used in different formulations in
clinical trials involving >275 human subjects, over 170 of which
have received the novel, proprietary suspension formulation. These
single and multiple dose studies suggest that RPL554, when inhaled
across a range of doses, is an effective bronchodilator and
anti-inflammatory agent and is an excellent candidate for further
development.
· Studies continue to demonstrate
the excellent bronchodilator properties of RPL554 indicating that
it is able to produce large improvements in lung function in
healthy subjects as well as patents with mild, moderate or severe
lung disease
· Data from the asthma study
indicate that RPL554 can produce an improvement in lung function at
least as large as the most commonly used rescue bronchodilator,
salbutamol
· The Company is strongly
encouraged by the observation that RPL554 is consistently well
tolerated in these studies. The new suspension formulation is much
better tolerated than the earlier solution formulation prototype,
with no maximum tolerated dose observed even at 16 times the active
bronchodilator dose
· New formulation is suitable for
twice daily dosing, which is convenient for patients
· Formulation provides for a
longer pulmonary residence time, lower peak plasma exposure and
longer half-life in blood than the earlier formulation, suggesting
a more pronounced effect locally in the lung and comparatively less
effects in other organs in the body
The suspension formulation of RPL554 has been developed for use
in nebulisers and this formulation will be used in the further
clinical development of the compound. The manufacture of this new
formulation is scalable and shows stability suitable for
commercialisation. The first Phase I/IIa clinical trial with the
new formulation of RPL554 started in December 2014 at MEU, Manchester, UK.
SAD/MAD Phase I/II study in healthy
volunteers and COPD patients
The first SAD/MAD study enrolled 80 healthy subjects and 32 COPD
patients. Increasing dose levels were tested in both the single
dose SAD and the multiple dose (MAD, treatment twice daily for 5.5
days) parts of the study with the pre-specified highest dose being
approximately 16 times greater than the dose used in earlier
reported clinical studies, using the previous formulation of
RPL554. The drug was well tolerated across all doses and no maximum
tolerated dose could be reached. Importantly, there were no
cardiovascular events of concern and a lack of PDE4-inhibitor-like
adverse events. Pharmacokinetic data showed lower peak plasma
levels and a significantly longer half-life of the drug in plasma,
than that observed with the previous formulation. This
suggests that the new suspension formulation results in a longer
residence time for RPL554 in the lung and slower release into the
blood stream, suggesting that twice-daily dosing may be
appropriate.
Dose-finding Phase IIa study in asthma
patients
A Phase IIa dose-finding study was conducted in 29 patients with
moderate asthma in UK and Sweden.
The study met its primary objective, with nebulised RPL554
demonstrating a dose-dependent bronchodilator response in asthma
patients. RPL554 pharmacokinetics was linear across the whole dose
range. At the highest doses of both compounds, RPL554 produced the
same maximum bronchodilator effect as that by a supramaximal dose
of nebulised salbutamol (7.5 mg, a dosed occasionally used in the
hospital emergency room). Even the lowest RPL554 dose of 0.4mg was
significantly superior (p<0.0001) to placebo as a
bronchodilator. All doses of RPL554 were found to be well tolerated
and the data supports the use of RPL554 in a twice daily dosing
regimen. There were no reports of serious adverse events and fewer
adverse events were seen with RPL554 than with salbutamol.
Salbutamol produced well-acknowledged adverse events for this drug
including tremor, tachycardia, palpitations, and a reduction in
blood potassium levels. The large dosing range (60 fold) of RPL554
suggests a potentially large therapeutic index.
Phase IIa study in COPD patients
A Phase IIa add-on bronchodilator study was conducted in 30
patients with moderate to severe COPD in UK. The primary objectives
of the study were met: RPL554 when used in combination with other
common bronchodilators was as well tolerated as the individual
drugs given alone. Furthermore, nebulised RPL554 produced a
significantly (p<0.0001) larger bronchodilator response when
added on-top-of a standard dose of either salbutamol (a beta2
agonist) or ipratropium (an anti-muscarinic drug) than either of
the individual drugs alone. Importantly, the combination with the
anti-muscarinic drug seemed to be more effective in peripheral
airways, in keeping with earlier in vitro data showing a
synergistic effect between RPL554 and anti-muscarinic drugs in
human large and small airways. The combination with the beta2
agonist seemed to be additive, as observed in earlier pre-clinical
studies. These data suggest that RPL554 could be both a stand-alone
treatment as well as a very attractive combination partner to
existing treatments for COPD.
The Company is highly encouraged by the results demonstrated
with this new suspension formulation of RPL554 and is preparing
plans to progress this formulation into a Phase IIb clinical
programme to investigate treatment of acute exacerbations in COPD
and maintenance treatment of COPD patients with a nebuliser.
Cystic fibrosis
Further experiments were performed in cells obtained from the
airways of cystic fibrosis patients to demonstrate that RPL554 is
an activator of CFTR, the ion channel that is dysfunctional and
causes the respiratory problems in patients with cystic fibrosis.
These data were presented at the North America Cystic Fibrosis
conference in Phoenix, US, in
October 2015 and in a peer-reviewed
manuscript in the American Journal of Physiology published in
November 2015. This work continues
with the support of a Venture and Innovation Award from the UK
Cystic Fibrosis Trust, the first to be granted to a biotech company
by the Trust. Cystic fibrosis is a rare, orphan disease, and
therefore provides a very attractive development and market
opportunity for the Company. The Company plans to commence
clinical work for this indication in 2017.
FINANCIALS
The loss from operations for the year ended 31 December 2015 was £7.42m (2014: £2.76m).
Research and development expenditure amounted to £7.27m (2014:
£2.63m) and reflected an increase in expenditures on the RPL554
programme by £4.88m to £7.15m (2014: £2.27m). The increase in
expenditure on the RPL554 programme was primarily due to a planned
acceleration of the development of the new nebulised formulation
programme.
Administrative expenses for the year were £1.71m (2014: £1.16m).
R&D costs are expected to be offset by R&D tax credits of
approximately £1.53m receivable in 2016.
As at 31 December 2015, the
Company had approximately £3.52 million in cash and cash
equivalents.
MANAGEMENT AND STAFF
In January 2015, the Company
appointed Dr Kenneth Newman as Chief
Medical Officer. Dr Newman is an experienced pharmaceutical and
biotechnology industry executive with extensive experience in
clinical development, particularly for the treatment of respiratory
disease. Prior to joining Verona Pharma, Dr Newman was Chief
Development Officer at Mesoblast Inc. Previously, Dr Newman held
the positions of Chief Medical Officer at Acton Pharmaceuticals,
VP, Medical Affairs at Boehringer Ingelheim and several positions
at Forest Laboratories (now Allergan). Dr Newman began his
professional career at the National Jewish Medical and Research
Center, Denver, Colorado.
The Company also significantly strengthened the Board of
Directors during the year. Dr Anders
Ullman, who joined the Board in September 2015, was previously EVP R&D at
Nycomed (now Takeda) and was responsible for the development and
approval of roflumilast (Daxas®) for the treatment of COPD.
He also oversaw the initiation of a post-approval Phase IV study
(the REACT study) which was published in the Lancet in February 2015. This study demonstrated that
treatment with the PDE4 inhibitor roflumilast leads to a 24%
reduction in severe COPD exacerbations even in the presence of
“double” or “triple” therapy. Subsequently AstraZeneca purchased
the commercial rights to roflumilast from Takeda.
Dr Ken Cunningham, who also
joined the Board in September, was the CEO of Arakis, a respiratory
company sold to Sosei. He was also a former CEO of Skyepharma plc,
which developed the orally inhaled drug Flutiform®, which is
approved in Europe and
Japan for the treatment of asthma
and licensed to Mundipharma. Ken was also chairman of Prosonix, an
inhalation development company, purchased by Circassia in 2015.
By adding Dr Ullman and Dr Cunningham to the Board, we have
significantly expanded the expertise on the Board both in terms of
respiratory medicine and significant transaction experience.
Post period end, Biresh Roy,
Chief Financial Officer, stepped down from the Board with immediate
effect but remains with Verona Pharma for up to six months to allow
time for a suitable successor to be appointed and for an orderly
handover. The Board has commenced a search for his successor and a
further announcement will be made in due course. The Board
thanks Biresh for his many contributions to the Company at what has
been a formative time for Verona Pharma, as it has delivered on
important operational and clinical goals it set at the time of the
2014 financing, on or ahead of budget in a timely manner.
OUTLOOK
The US has about 12 million patients diagnosed with COPD, and it
is expected that there are almost as many again that remain
undiagnosed. About 9% of COPD patients prefer to use a nebuliser
over other types of inhalation devices, so they are comfortable
that they have actually received the medication. This is
potentially a large market for RPL554.
The Board believes that RPL554, with its unique bronchodilator,
anti-inflammatory and CFTR activator properties, is capable of
addressing specific patient groups that are currently under-treated
and for which there is limited competition in the form of new types
of drugs with both bronchodilator and anti-inflammatory properties,
such as patients with COPD, cystic fibrosis and possibly asthma.
The Board believes that RPL554 therefore presents a very attractive
commercial opportunity for generating significant value for
shareholders.
We have made considerable clinical progress with RPL554 since
the March 2014 fundraising. The
complete set of Phase IIa data is expected by end Q2 2016 after
which the Company will prepare the compound for Phase IIb studies.
The completion of these studies represents the next significant
value inflection point for the Company.
The Directors are currently considering all options for further
funding of such studies. As part of this process, and as previously
stated, the Board recognises that an experienced and resourceful
commercial partner could bring significant value to the development
of a DPI/MDI formulation of RPL554 for chronic maintenance
treatment in COPD and potentially other respiratory diseases.
The Company therefore continues to be involved in business
development discussions around the RPL554 programme and may
undertake some limited additional clinical work to enhance to
prospects of an attractive partnership. The Company intends to
partner its drug candidates only when it can extract a commercially
attractive return for the Company and its shareholders.
The Company will continue to operate with a strong focus and
financial discipline, and remains very positive about its progress
to date and the opportunities for its lead drug development
programme in COPD.
We would like to thank the staff and Board members for all their
contributions and shareholders for their continued support during a
successful year.
Dr. David Ebsworth |
Dr. Jan-Anders Karlsson |
Chairman |
Chief Executive Officer |
|
|
2 June 2016 |
2 June 2016 |
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2015
|
|
|
|
|
Notes |
Year ended
31 December 2015 |
Year ended
31 December 2014 |
|
|
£ |
£ |
|
|
|
|
Research and
development costs |
|
(7,265,063) |
(2,634,848) |
General and administrative
costs |
|
(1,705,944) |
(1,157,925) |
|
|
|
|
Operating loss |
5 |
(8,971,007) |
(3,792,773) |
|
|
|
|
Finance income |
7 |
44,791 |
29,978 |
|
|
|
|
Loss before taxation |
|
(8,926,216) |
(3,762,795) |
|
|
|
|
Taxation – credit |
8 |
1,509,448 |
1,004,065 |
|
|
|
|
Loss and total comprehensive loss
for the year |
|
(7,416,768) |
(2,758,730) |
|
|
|
|
Loss and total comprehensive loss attributable to equity owners
of the Company |
|
(7,416,768) |
(2,758,730) |
|
|
|
|
Loss per ordinary share – basic and
diluted (pence) |
3 |
(0.73)p |
(0.32)p |
GROUP STATEMENT OF FINANCIAL POSITION
AS AT 31
DECEMBER 2015
|
|
|
|
|
Notes |
31 December
2015 |
31 December
2014 |
|
|
£ |
£ |
ASSETS |
|
|
|
|
|
|
|
Non-current assets |
|
|
|
Plant and equipment |
13 |
13,822 |
21,847 |
Intangible assets – patents |
14 |
343,985 |
380,540 |
Goodwill |
15 |
1,469,112 |
1,469,112 |
|
|
1,826,919 |
1,871,499 |
|
|
|
|
Current assets |
|
|
|
Trade and other receivables |
10 |
2,048,088 |
1,287,535 |
Cash and cash equivalents |
11 |
3,524,387 |
9,969,759 |
|
|
5,572,475 |
11,257,294 |
|
|
|
|
Total assets |
|
7,399,394 |
13,128,793 |
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
|
Capital and reserves
attributable to
equity holders |
|
|
|
Share capital |
16 |
1,009,923 |
1,009,923 |
Share premium |
|
26,650,098 |
26,650,098 |
Share-based payment reserve |
|
1,022,440 |
677,946 |
Retained losses |
|
(23,095,806) |
(15,733,487) |
Total equity |
|
5,586,655 |
12,604,480 |
|
|
|
|
Current liabilities |
|
|
|
Trade and other payables |
12 |
1,812,739 |
524,313 |
Total liabilities |
|
1,812,739 |
524,313 |
|
|
|
|
Total equity and
liabilities |
|
7,399,394 |
13,128,793 |
The financial statements were approved by the Board of Directors
on 2 June 2016 and signed on its
behalf by:
Dr. Jan-Anders
Karlsson
|
Biresh Roy |
Chief Executive |
Chief Financial Officer |
Company Number: 05375156
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31
DECEMBER 2015
|
|
|
|
|
Notes |
31 December
2015 |
31 December
2014 |
|
|
£ |
£ |
ASSETS |
|
|
|
|
|
|
|
Non-current assets |
|
|
|
Plant and equipment |
13 |
13,822 |
21,847 |
Intangible assets – patents |
14 |
343,985 |
380,540 |
Goodwill |
15 |
1,453,569 |
1,453,569 |
Investment |
9 |
79,593 |
2 |
|
|
1,890,969 |
1,855,958 |
|
|
|
|
Current assets |
|
|
|
Trade and other receivables |
10 |
2,048,617 |
1,287,535 |
Cash and cash equivalents |
11 |
3,523,140 |
9,968,483 |
|
|
5,571,757 |
11,256,018 |
|
|
|
|
Total assets |
|
7,462,726 |
13,111,976 |
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
|
Capital and reserves
attributable to
equity holders |
|
|
|
Called up share capital |
16 |
1,009,923 |
1,009,923 |
Share premium account |
|
26,650,098 |
26,650,098 |
Share-based payment reserve |
|
1,022,440 |
677,946 |
Retained losses |
|
(23,137,641) |
(15,750,305) |
Total equity |
|
5,544,820 |
12,587,662 |
|
|
|
|
Current liabilities |
|
|
|
Trade and other payables |
12 |
1,917,906 |
524,314 |
|
|
|
|
Total liabilities |
|
1,917,906 |
524,314 |
|
|
|
|
Total equity and
liabilities |
|
7,462,726 |
13,111,976 |
The financial statements were approved by the Board of Directors
on 2 June 2016 and signed on its
behalf by:
Dr. Jan-Anders
Karlsson
|
Biresh Roy |
Chief Executive |
Chief Financial Officer |
Company Number: 05375156
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2015
|
|
|
|
|
Notes |
Year ended
31 December 2015 |
Year ended
31 December 2014 |
|
|
£ |
£ |
Cash flows from operating
activities |
|
|
|
Cash used in operating
activities |
17 |
(7,052,412) |
(3,833,926) |
Income tax credit received |
|
699,519 |
293,263 |
|
|
|
|
Net cash used in operating
activities |
|
(6,352,893) |
(3,540,663) |
|
|
|
|
Cash flow from investing
activities |
|
|
|
Interest received |
|
50,591 |
24,178 |
Purchase of plant and equipment |
|
(1,830) |
(4,882) |
Payment for patents |
|
(141,240) |
(215,676) |
Net cash used in investing
activities |
|
(92,479) |
(196,380) |
|
|
|
|
Cash flow from financing
activities |
|
|
|
Net proceeds from issue of
shares |
|
- |
13,103,011 |
Net cash generated from financing
activities |
|
- |
13,103,011 |
|
|
|
|
Net (decrease)/increase in cash
and cash equivalents |
|
(6,445,372) |
9,365,968 |
|
|
|
|
Cash and cash equivalents at the
beginning of the year |
|
9,969,759 |
603,791 |
|
|
|
|
Cash and cash equivalents at the end of the year |
11 |
3,524,387 |
9,969,759 |
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2015
|
|
|
|
|
Notes |
Year ended
31 December 2015 |
Year ended
31 December 2014 |
|
|
£ |
£ |
Cash flows from operating
activities |
|
|
|
Cash used in operating
activities |
17 |
(7,052,383) |
(3,833,914) |
Income tax credit received |
|
699,519 |
293,263 |
|
|
|
|
Net cash used in operating
activities |
|
(6,352,864) |
(3,540,651) |
|
|
|
|
Cash flow from investing
activities |
|
|
|
Interest received |
|
50,591 |
24,178 |
Purchase of plant and equipment |
|
(1,830) |
(4,882) |
Payments for patents |
|
(141,240) |
(215,676) |
Net cash used in investing
activities |
|
(92,479) |
(196,380) |
|
|
|
|
Cash flow from financing
activities |
|
|
|
Net proceeds from issue of
shares |
|
- |
13,103,011 |
Net cash generated from financing
activities |
|
- |
13,103,011 |
|
|
|
|
Net (decrease)/increase in cash
and cash equivalents |
|
(6,445,343) |
9,365,980 |
|
|
|
|
Cash and cash equivalents at the
beginning of the year |
|
9,968,483 |
602,503 |
|
|
|
|
Cash and cash equivalents at the end of the year |
11 |
3,523,140 |
9,968,483 |
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2015
|
Share |
Share |
Option |
Retained |
Total |
|
capital |
premium |
reserve |
losses |
|
|
£ |
£ |
£ |
£ |
£ |
|
|
|
|
|
|
Balance at 1 January
2014 |
372,598 |
14,184,412 |
640,579 |
(13,129,576) |
2,068,013 |
|
|
|
|
|
|
Loss for the year |
- |
- |
- |
(2,758,730) |
(2,758,730) |
Other comprehensive income |
- |
- |
- |
- |
- |
Total comprehensive loss for the
year |
- |
- |
- |
(2,758,730) |
(2,758,730) |
|
|
|
|
|
|
Issue of shares |
637,325 |
13,383,821 |
- |
- |
14,021,146 |
Share issue costs |
- |
(918,135) |
- |
- |
(918,135) |
Share-based payments |
- |
- |
192,186 |
- |
192,186 |
Transfer of
previously
expensed share based payment
charge upon lapse of
options |
- |
- |
(154,819) |
154,819 |
- |
Balance at 31 December 2014 |
1,009,923 |
26,650,098 |
677,946 |
(15,733,487) |
12,604,480 |
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 1 January
2015 |
1,009,923 |
26,650,098 |
677,946 |
(15,733,487) |
12,604,480 |
|
|
|
|
|
|
Loss for the year |
- |
- |
- |
(7,416,768) |
(7,416,768) |
Other comprehensive income |
- |
- |
- |
- |
- |
Total comprehensive loss for the
year |
- |
- |
- |
(7,416,768) |
(7,416,768) |
|
|
|
|
|
|
Issue of shares |
- |
- |
- |
- |
- |
Share issue costs |
- |
- |
- |
- |
- |
Share-based payments |
- |
- |
398,943 |
- |
398,943 |
Transfer of
previously
expensed share based payment
charge upon lapse of
options |
- |
- |
(54,449) |
54,449 |
- |
Balance at 31 December 2015 |
1,009,923 |
26,650,098 |
1,022,440 |
(23,095,806) |
5,586,655 |
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2015
|
Share |
Share |
Option |
Retained |
Total |
|
capital |
premium |
reserve |
losses |
|
|
£ |
£ |
£ |
£ |
£ |
|
|
|
|
|
|
Balance at 1 January
2014 |
372,598 |
14,184,412 |
640,579 |
(13,147,128) |
2,050,461 |
|
|
|
|
|
|
Loss for the year |
- |
- |
- |
(2,757,996) |
(2,757,996) |
Other comprehensive income |
- |
- |
- |
- |
- |
Total comprehensive loss for the
year |
- |
- |
- |
(2,757,996) |
(2,757,996) |
|
|
|
|
|
|
Issue of shares |
637,325 |
13,383,821 |
- |
- |
14,021,146 |
Share issue costs |
- |
(918,135) |
- |
- |
(918,135) |
Share-based payments |
- |
- |
192,186 |
- |
192,186 |
Transfer of
previously
expensed share based payment
charge upon lapse of
options |
- |
- |
(154,819) |
154,819 |
- |
Balance at 31 December 2014 |
1,009,923 |
26,650,098 |
677,946 |
(15,750,305) |
12,587,662 |
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 1 January
2015 |
1,009,923 |
26,650,098 |
677,946 |
(15,750,305) |
12,587,662 |
|
|
|
|
|
|
Loss for the year |
- |
- |
- |
(7,441,785) |
(7,441,785) |
Other comprehensive income |
- |
- |
- |
- |
- |
Total comprehensive loss for the
year |
- |
- |
- |
(7,441,785) |
(7,441,785) |
|
|
|
|
|
|
Issue of shares |
- |
- |
- |
- |
- |
Share issue costs |
- |
- |
- |
- |
- |
Share-based payments recognised as
expense |
- |
- |
319,352 |
- |
319,352 |
Share-based payments recognised as
investment in subsidiary |
- |
- |
79,591 |
- |
79,591 |
Transfer of
previously
expensed share based payment
charge upon lapse of
options |
- |
- |
(54,449) |
54,449 |
- |
Balance at 31 December 2015 |
1,009,923 |
26,650,098 |
1,022,440 |
(23,137,641) |
5,544,820 |
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2015
1. General information
Verona Pharma plc (“the company”) and its subsidiaries (together
“the group”) develop innovative prescription medicines to treat
respiratory diseases.
The company is a public limited company, which is listed on the
Alternative Investment Market (AIM) and incorporated and domiciled
in the UK.
2. Accounting policies
A summary of the principal accounting policies, all of which
have been applied consistently throughout the year, is set out
below.
2.1. Basis of preparation
The consolidated financial statements of Verona Pharma plc have
been prepared in accordance with International Financial Reporting
Standards (IFRS) and IFRS Interpretations Committee (IFRS IC)
interpretations as adopted by the European Union and the Companies
Act 2006 applicable to companies reporting under IFRS. The
consolidated financial statements have been prepared under the
historical cost convention.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates. It
also requires management to exercise its judgement in the process
of applying the group’s accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the consolidated
financial statements are disclosed in note 2.14.
2.2. Going concern
During the year ended 31 December
2015 the Group made a loss of £7,416,768 (2014: a loss of
£2,758,730). At the year-end date the Group had net assets of
£5,586,655 (2014: £12,604,480) of which £3,524,387 was cash and
cash equivalents.
The operation of the Group is currently being financed from
funds that the Company raised from share placings. On 24 March 2014 the Company announced that it had
raised £14.0 million in gross proceeds from a placing, subscription
and open offer.
These funds have been used primarily to support the development
of RPL554 in moderate and severe COPD as well as corporate and
general administrative expenditures.
The Group's capital management policy is to only raise
sufficient funding to finance the Group's near term objectives of
its clinical development programmes. Based on considerable clinical
progress with RPL554 since the March
2014 fundraising, the next significant value inflection
point is expected to be completion of phase 2b studies (which will
require funding). The Directors are currently considering all
options for further funding of such studies. As part of this
process, and as previously stated, the Company recognises that the
right commercial partner could bring significant value to the
development of RPL554 for chronic maintenance treatment in COPD and
perhaps asthma. The Company therefore continues to be involved in
business development discussions around RPL554.
The Directors believe that the Group has sufficient funds to
complete the current clinical trials, to cover corporate and
general administration costs and for it to comply with all its
current and foreseeable commitments and, accordingly, are satisfied
that the going concern basis remains appropriate for the
preparation of these financial statements.
2.3. Basis of consolidation
These group financial statements include the accounts of Verona
Pharma plc and its wholly-owned subsidiaries Rhinopharma Limited
and Verona Pharma Inc. The purchase method of accounting is used to
account for the acquisition of Rhinopharma Limited.
The cost of an acquisition is measured as the fair value of the
assets given, equity instruments issued and liabilities incurred or
assumed at the date of exchange, plus costs directly attributable
to the acquisition. Identifiable assets acquired and liabilities
and contingent liabilities assumed in a business combination are
measured initially at their fair values at the acquisition date,
irrespective of the extent of any minority interest. The excess of
the cost of acquisition over the fair value of the Group’s share of
the identifiable net assets acquired is recorded as goodwill.
Goodwill arising on acquisitions is capitalised and subject to an
impairment review, both annually and when there are indications
that the carrying value may not be recoverable.
Inter-company transactions, balances and unrealised gains on
transactions between group companies are eliminated.
Rhinopharma Limited and Verona Pharma Inc. adopt the same
accounting policies as the Company.
2.4. Foreign currency translation
Items included in the Group's financial statements are measured
using the currency of the primary economic environment in which the
Group operates ("the functional currency"). The financial
statements are presented in pounds sterling ("£"), which is the
functional and presentational currency of the Company and the
presentational currency of the Group.
Transactions in foreign currencies are recorded using the rate
of exchange ruling at the date of the transaction. Monetary assets
and liabilities denominated in foreign currencies are translated
using the rate of exchange ruling at the balance sheet date and the
gains or losses on translation are included in the profit and loss
account. Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated using the
exchange rates as at the dates of the original transactions.
Non-monetary items measured at fair value in a foreign currency are
translated using the exchange rates at the date when the fair value
was determined.
The assets and liabilities of foreign operations are translated
into sterling at the rate of exchange ruling at the balance sheet
date. Income and expenses are translated at weighted average
exchange rates for the period. The resulting exchange
differences are recognised in other comprehensive income.
2.5. Cash and cash equivalents
In the consolidated statement of cash flows, cash and cash
equivalents includes cash in hand, deposits held at call with
banks, other short-term highly liquid investments with original
maturities of three months or less.
2.6. Deferred Taxation
Deferred tax is provided in full, using the liability method, on
temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements.
Deferred tax is determined using tax rates (and laws) that have
been enacted or substantially enacted by the balance sheet date and
expected to apply when the related deferred tax is realised or the
deferred liability is settled.
Deferred tax assets are recognised to the extent that it is
probable that the future taxable profit will be available against
which the temporary differences can be utilised.
2.7. Research and development
costs
Capitalisation of expenditure on product development commences
from the point at which technical feasibility and commercial
viability of the product can be demonstrated and the Group is
satisfied that it is probable that future economic benefits will
result from the product once completed. No such costs have been
capitalised to date, given the early stage of the Group’s product
development
Expenditure on research and development activities that do not
meet the above criteria is charged to the Statement of
Comprehensive Income as incurred.
2.8. Plant and equipment
Property, plant and equipment are stated at cost, net of
depreciation and any provision for impairment. Cost includes the
original purchase price of the asset and the costs attributable to
bringing the asset to its working condition for its intended use.
Depreciation is calculated so as to write off the cost less their
estimated residual values, on a straight-line basis over the
expected useful economic lives of the assets concerned. The
principal annual periods used for this purpose are:
Computer hardware |
3 years |
Computer software |
2 years |
Office furniture and equipment |
5 years |
2.9. Intangible assets and
goodwill
(a) Group Goodwill
Group Goodwill arises on the acquisition of subsidiaries and
represents the excess of the consideration transferred over the
fair value of the identifiable net assets acquired.
(b) Patents
Patent costs associated with the preparation, filing, and
obtaining of patents are capitalised and amortised on a
straight-line basis over the estimated useful lives of the patents
of ten years.
2.10. Impairment of intangible assets
and goodwill
Intangible assets that have an indefinite useful life or
intangible assets not ready to use are not subject to amortisation
and are tested annually for impairment. Assets that are
subject to amortisation are reviewed for impairment whenever events
of changes in circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised for the
amount by which the asset’s carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset’s
fair value (less costs of disposal) and value in use.
2.11. Pension
The Group operates a defined contribution pension scheme.
Contributions payable for the year are charged to the Statement of
Comprehensive Income. Differences between contributions payable in
the year and contributions actually paid are shown as either
accruals or prepayments in the Statement of Financial
Position. The Group has no further payment obligation once
the contributions have been paid.
2.12. Share based payments
The Group operates a number of equity-settled, share-based
compensation plans. The fair value of share-based payments
under such schemes is expensed on a straight-line basis over the
vesting period, based on the Group’s estimate of shares that will
eventually vest.
The fair value calculation of share-based payments requires
several assumptions and estimates as disclosed in note 19.
The calculation uses the Black-Scholes model.
For equity-settled share-based payments where employees of
subsidiary undertakings are rewarded with shares issued by the
Parent Company, a capital contribution is recorded in the
subsidiary, with a corresponding increase in the investment in the
Parent Company.
Where warrants have been issued to external parties as
recompense for services supplied, the fair value of warrants is
charged to the Statement of Comprehensive Income over the period of
services are received and a corresponding credit is made to
reserves.
2.13. Investments in
subsidiaries
Investments in subsidiaries are shown at cost less any provision
for impairment.
2.14. Critical accounting
judgements and estimates
The preparation of financial statements in conformity with
International Financial Reporting Standards requires the use of
accounting estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during
the reporting period. Although these estimates are based on
management’s best knowledge of current events and actions, actual
results ultimately may differ from those estimates. IFRSs also
require management to exercise its judgement in the process of
applying the Group’s accounting policies.
The areas involving a higher degree of judgement or complexity,
or areas where assumptions and estimates are significant to the
financial statements are as follows:
(a) Going Concern
The financial statements have been prepared on a going concern
basis, which assumes that sufficient funds will be available for
the Company and Group to continue in operational existence for the
foreseeable future. More details are set out in note 2.2.
(b) Impairment of intangible
assets
Determining whether an intangible asset is impaired requires an
estimation of whether there are any indications that its carrying
value is not recoverable.
At each reporting date, the Group reviews the carrying value of
its tangible and intangible assets to determine whether there is
any indication that those assets have been impaired. If such an
indication exists, the recoverable amount of the asset, being the
higher of the asset’s fair value less costs to sell and value in
use, is compared to the asset’s carrying value. Any excess of the
asset’s carrying value over its recoverable amount is expensed to
the income statement.
Details of the Group’s assessment of the carrying value of
goodwill are disclosed in note 15.
(c) Share based payments
The Group records charges for share based payments. For option
based share based payments management estimate certain factors used
in the option pricing model, including volatility, vesting date of
options and number of options likely to vest. If these estimates
vary from actual occurrence, this will impact on the value of the
equity carried in the reserves. Further details of the Group’s
estimation of share based payments are disclosed in note 19.
2.15. New standards, amendments
and interpretations adopted by the Group
The following standards have been adopted by the Group for the
first time for the financial year beginning on or after 1 January
2015. They do not materially impact on the Group results:
· Annual improvements 2011 -
2013
2.16. New standards, amendments
and interpretations issued but not effective for the financial year
beginning 1 January 2015 and not
early adopted
A number of new standards and amendments to standards and
interpretations have been endorsed for annual periods beginning
after 1 January 2015 (noted below),
and have not been early adopted in preparing these consolidated
financial statements. None of these are expected to have a
significant effect on the consolidated financial statements of the
group.
· Annual improvements 2014
(2012-2014 cycle)
· Amendment to IFRS 11, 'Joint
arrangements' on acquisition of an interest in a joint
operation
· Amendments to IAS 16, 'Property,
plant and equipment'
· Amendments to IAS 27, 'Separate
financial statements' on the equity method
· Amendment to IAS 1,
'Presentation of financial statements' on the disclosure
initiative
· Amendment to IFRS 10, 11 and 12
on transition guidance
· Amendments to IAS 32 and IFRS 7
Financial instruments on asset and liability offsetting
· IAS 28 (revised), 'Investments
in associates and joint ventures'
· IFRS 13, 'Fair value
measurement'
· Amendment to IAS 12,'Income
taxes' on deferred tax
· Amendment to IAS 16, 'Property,
plant and equipment' and IAS 38,'Intangible assets', on
depreciation and amortisation
· Amendment to IAS 36, 'Impairment
of assets' on recoverable amount disclosures.
A number of new standards and amendments to standards and
interpretations have been issued but are not yet endorsed for
annual periods beginning after 1 January
2015 (noted below), and have not been adopted in preparing
these consolidated financial statements. None of these are expected
to have a significant effect on the consolidated financial
statements of the Group.
· IFRS 15 Revenue from contracts
with customers (effective for annual periods beginning on or after
1 January 2018)
· IFRS 9 Financial instruments
(effective for annual periods beginning on or after 1 January 2018)
3. Earnings per
share
Basic loss per share of 0.73p (2014: loss of 0.32p) for the
Group is calculated by dividing the loss for the period by the
weighted average number of ordinary shares in issue of
1,009,923,481 (2014: 866,743,656).
Potential ordinary shares are not treated as dilutive as the
entity is loss making.
4.
Segmental information
The Group has determined that its operating segments be reported
on a product pipeline basis as this best reflects the Group’s
activity cycle. Operating segments are reported in a manner
consistent with the internal reporting provided to the chief
operating decision-maker. The chief operating decision-maker
has been identified as the Board of Directors.
The Group’s product pipeline is dedicated to the research,
discovery and development of new therapeutic drugs for the
treatment of acute and chronic respiratory diseases. Two
products had reached the clinical stage: RPL554 and VRP700.
However VRP700 was abandoned in 2015 in order to concentrate on
RPL554. The basic research figures are for NAIPs, which were
also abandoned in 2015.
Segment information by operating segment is as
follows:
|
Clinical |
Clinical |
Basic
research |
Basic
research |
|
2015 |
2014 |
2015 |
2014 |
|
£ |
£ |
£ |
£ |
Income statement
information |
|
|
|
|
Research and development |
(7,087,269) |
(2,634,848) |
- |
- |
Amortisation of patents |
(42,983) |
(38,046) |
(279) |
(4,233) |
Write-off of patents |
(108,707) |
- |
(25,825) |
- |
Segment loss |
(7,238,959) |
(2,672,894) |
(26,104) |
(4,233) |
|
|
|
|
|
Assets information |
|
|
|
|
Patent |
343,985 |
356,244 |
- |
24,296 |
Goodwill |
1,469,112 |
1,469,112 |
- |
- |
Segment intangible assets |
1,813,097 |
1,825,356 |
- |
24,296 |
|
2015 |
2014 |
|
£ |
£ |
Reconciliation of segment
result |
|
|
Loss per reportable segment –
Clinical |
(7,238,959) |
(2,672,894) |
Loss per segment – Basic
research |
(26,104) |
(4,233) |
Total loss for reportable
segments |
(7,265,063) |
(2,677,127) |
Depreciation of non-segment assets
Unallocated general and administrative costs |
(9,855)
(1,696,089) |
(10,683)
(1,104,963) |
Group operating loss |
(8,971,007) |
(3,792,773) |
At the end of the financial year, the Group was still in the
early development stage and therefore had no turnover in either
2014 or 2015.
Reconciliation of segment
assets |
|
|
Assets per reportable segment –
Clinical |
1,813,097 |
1,825,356 |
Assets per reportable segment –
Basic research |
- |
24,296 |
Total assets for reportable
segments |
1,813,097 |
1,849,652 |
Unallocated non-current assets
Unallocated current assets |
13,822
5,572,475 |
21,847
11,257,294 |
Group total assets |
7,399,394 |
13,128,793 |
Segment information by geographical segment for 2015 is as
follows:
Geographical segment
(Group) |
United
Kingdom |
North
America |
Total |
|
£ |
£ |
£ |
Research and development costs |
(6,833,830) |
(431,233) |
(7,265,063) |
General and administrative
costs |
(1,704,856) |
(1,088) |
(1,705,944) |
Finance income |
44,791 |
- |
44,791 |
Loss before taxation |
(8,493,895) |
(432,321) |
(8,926,216) |
|
|
|
|
Tangible assets |
13,822 |
- |
13,822 |
Intangible assets |
343,985 |
- |
343,985 |
Trade and other receivables |
2,048,088 |
- |
2,048,088 |
Cash and cash equivalents |
3,523,140 |
1,247 |
3,524,387 |
Goodwill |
1,469,112 |
- |
1,469,112 |
Trade and other payables |
(1,782,006) |
(30,733) |
(1,812,739) |
Net assets |
5,616,141 |
(29,486) |
5,586,655 |
Segment information by geographical segment for 2014 is as
follows:
Geographical segment
(Group) |
United
Kingdom |
North
America |
Total |
|
£ |
£ |
£ |
Research and development costs |
(2,634,848) |
- |
(2,634,848) |
General and administrative
costs |
(1,157,191) |
(734) |
(1,157,925) |
Finance income |
29,978 |
- |
29,978 |
Loss before taxation |
(3,762,061) |
(734) |
(3,762,795) |
|
|
|
|
Tangible assets |
21,847 |
- |
21,847 |
Intangible assets |
380,540 |
- |
380,540 |
Trade and other receivables |
1,287,535 |
1 |
1,287,536 |
Cash and cash equivalents |
9,968,483 |
1,276 |
9,969,759 |
Goodwill |
1,469,112 |
- |
1,469,112 |
Trade and other payables |
(524,314) |
- |
(524,314) |
Net assets |
12,603,203 |
1,277 |
12,604,480 |
5. Operating
expenses |
|
|
|
2015 |
2014 |
Group |
£ |
£ |
Loss before income tax is
stated after charging: |
|
|
|
|
|
Research and development
costs: |
|
|
Employee benefits (note 6) |
1,322,109 |
678,147 |
Amortisation of patents |
43,262 |
42,280 |
Write-off of patents |
134,532 |
- |
Other expenses |
5,765,160 |
1,914,421 |
Total research and developments
costs |
7,265,063 |
2,634,848 |
General and administrative
costs: |
|
|
Employee benefits (note 6) |
624,821 |
369,791 |
Legal and professional fees |
608,447 |
394,316 |
Depreciation of plant and
equipment |
9,855 |
10,683 |
Operating lease charge |
156,632 |
70,085 |
Other expenses |
306,189 |
313,050 |
Total general and administrative
costs |
1,705,944 |
1,157,925 |
Total research and development and
general administrative costs |
8,971,007 |
3,792,773 |
During the year the Group obtained services from the Group’s
auditors and its associates as detailed below:-
|
2015 |
2014 |
Services provided by
the Group’s auditors |
£ |
£ |
Fees payable to
the Group’s auditors |
|
|
For the audit of Parent
Company and consolidated financial statements |
25,000 |
22,750 |
IT services review |
9,972 |
- |
Taxation
consultancy |
- |
2,500 |
Total |
34,972 |
25,250 |
6. Directors’ emoluments and
staff costs |
|
|
|
|
|
|
|
|
|
2015 |
2014 |
|
|
Number |
Number |
Group |
|
|
|
The average number of persons
(including members of the Board) during the year was: |
|
13 |
11 |
|
|
|
|
|
|
2015 |
2014 |
|
|
£ |
£ |
Aggregate emoluments of
directors: |
|
|
|
Salaries and other short-term
employee benefits |
|
854,012 |
526,582 |
Consulting fee |
|
89,051 |
99,500 |
Pension contributions |
|
37,989 |
- |
|
|
981,052 |
626,082 |
Share-based payment charge |
|
231,790 |
121,602 |
Directors’ emoluments including
share-based payment charge |
|
1,212,842 |
747,684 |
|
|
|
|
|
|
2015 |
2014 |
|
|
£ |
£ |
Aggregate other staff
costs: |
|
|
|
Wages and salaries |
|
539,802 |
254,935 |
Social security costs |
|
41,966 |
28,582 |
Share-based payment charge |
|
137,393 |
16,737 |
Pension costs |
|
14,927 |
- |
|
|
734,088 |
300,254 |
|
|
|
|
The Group operates a
defined contribution pension scheme for UK employees and executive
directors. The total pension cost during the year was £52,916
(2014: £nil). There are no prepaid or accrued contributions to the
scheme at the year-end (2014: £nil). |
7. Finance income |
|
2015 |
2014 |
|
|
£ |
£ |
Group |
|
|
|
Bank interest |
|
44,791 |
29,978 |
|
|
|
|
8.
Taxation |
|
|
|
|
|
|
|
|
|
2015 |
2014 |
|
|
£ |
£ |
Analysis of tax credit for the
year |
|
|
|
Current tax: |
|
|
|
UK corporation tax at 20.25% (2014:
21.5%) |
|
(1,520,732) |
(641,652) |
Prior year adjustment |
|
11,284 |
(362,413) |
Current tax credit |
|
(1,509,448) |
(1,004,065) |
|
|
|
|
Factors affecting
the tax charge for the year |
|
|
|
Loss on ordinary activities before
taxation |
|
(8,926,216) |
(3,762,795) |
|
|
|
|
Multiplied by standard rate of
corporation |
|
|
|
tax of 20.25% (2014: 21.5%) |
|
(1,807,559) |
(809,001) |
|
|
|
|
Effects of: |
|
|
|
Non-deductible expenses |
|
113,529 |
2,194 |
Research and Development
Incentive |
|
(599,368) |
(201,938) |
Timing differences not
recognised |
|
(1,880) |
38,026 |
Tax losses carried forward |
|
774,546 |
329,067 |
Prior year adjustment |
|
11,284 |
(362,413) |
|
|
|
|
Current tax credit |
|
(1,509,448) |
(1,004,065) |
Factors that may affect future tax
charges
At the year-end date the Group has unused United Kingdom tax losses available for offset
against suitable future profits in the United Kingdom. A deferred tax asset has not
been recognised in respect of such losses due to uncertainty of
future profit streams. The contingent deferred tax asset at 18%
(2014: 20%) is estimated to be £2,244,221 (2014: £2,464,229).
9.
Investments in subsidiaries
The Company currently has two wholly owned subsidiaries,
Rhinopharma Limited and Verona Pharma Inc.
|
|
2015 |
2014 |
Company |
|
£ |
£ |
Net book amount: |
|
|
|
At the start of the year |
|
2 |
1 |
Investment in subsidiary |
|
- |
1 |
Capital contribution arising from
share-based payments |
|
79,591 |
- |
Net book amount at the end of year |
|
79,593 |
2 |
A capital contribution arises where share-based payments are
provided to employees of subsidiary undertakings settled with
equity to be issued by the Company.
The Company’s investments comprise interest in Group
undertakings, details of which are shown below:
Name of undertaking |
Verona Pharma
Inc. |
Rhinopharma
Limited |
Country of incorporation |
Delaware |
British Columbia |
|
USA |
Canada |
Description of shares held |
$0.001 |
Without Par
Value |
|
Common stock |
Common shares |
Proportion of shares held by the
Company |
100% |
100% |
Verona Pharma Inc. was incorporated on the 12 December 2014 under the laws of the
State of Delaware, USA.
Rhinopharma Limited is incorporated under the laws of the Province
of British Columbia, Canada.
Rhinopharma Limited was a drug discovery and development company
focused on developing proprietary drugs to treat allergic rhinitis
and other respiratory diseases prior to its acquisition by the
Company on 18 September 2006.
10. Trade and other
receivables |
|
2015 |
2014 |
|
|
£ |
£ |
Group |
|
|
|
Other receivables |
|
1,851,775 |
922,934 |
Prepayments and accrued income |
|
196,313 |
364,601 |
|
|
2,048,088 |
1,287,535 |
Company |
|
|
|
Other receivables |
|
1,851,775 |
922,934 |
Prepayments and accrued income |
|
196,313 |
364,601 |
Amounts due from Group
undertakings |
|
529 |
- |
|
|
2,048,617 |
1,287,535 |
The classes within trade and other receivables do not include
impaired assets.
Amounts due from Group undertakings are unsecured, interest
free, have no fixed date of repayment and are repayable on
demand.
11. Cash and cash
equivalents |
|
2015 |
2014 |
|
|
£ |
£ |
Group |
|
|
|
Cash at bank and in hand |
|
3,524,387 |
9,969,759 |
Company |
|
|
|
Cash at bank and in hand |
|
3,523,140 |
9,968,483 |
12.
Trade and other
payables |
|
2015 |
2014 |
|
|
£ |
£ |
Group |
|
|
|
Trade payables |
|
1,281,946 |
366,626 |
Other payables |
|
54,964 |
31,493 |
Accruals |
|
475,829 |
126,194 |
|
|
1,812,739 |
524,313 |
|
|
|
|
Company |
|
|
|
Trade payables |
|
1,281,946 |
366,626 |
Other payables |
|
32,328 |
31,494 |
Amounts due to Group
undertakings |
|
135,900 |
- |
Accruals |
|
467,732 |
126,194 |
|
|
1,917,906 |
524,314 |
Amounts due to Group undertakings are not interest bearing and
have no fixed repayment date.
13. Plant and
equipment |
|
|
|
|
|
Group and Company |
Computer
hardware |
Computer
software |
Office
equipment |
Total |
|
£ |
£ |
£ |
£ |
Cost |
|
|
|
|
At 1 January 2014 |
36,670 |
23,684 |
36,461 |
96,815 |
Additions |
4,632 |
250 |
- |
4,882 |
At 31 December 2014 |
41,302 |
23,934 |
36,461 |
101,697 |
|
|
|
|
|
Depreciation |
|
|
|
|
At 1 January 2014 |
34,245 |
21,732 |
13,191 |
69,168 |
Charge for the year |
1,645 |
2,014 |
7,023 |
10,682 |
At 31 December 2014 |
35,890 |
23,746 |
20,214 |
79,850 |
|
|
|
|
|
Net book value |
|
|
|
|
At 31 December 2014 |
5,412 |
188 |
16,247 |
21,847 |
|
|
|
|
Net book value |
|
|
|
|
At 31 December 2013 |
2,425 |
1,952 |
23,270 |
27,647 |
|
|
|
|
|
|
Group and Company |
Computer
hardware |
Computer
software |
Office
equipment |
Total |
|
£ |
£ |
£ |
£ |
Cost |
|
|
|
|
At 1 January 2015 |
41,302 |
23,934 |
36,461 |
101,697 |
Additions |
1,193 |
637 |
- |
1,830 |
At 31 December 2015 |
42,495 |
24,571 |
36,461 |
103,527 |
|
|
|
|
|
Depreciation |
|
|
|
|
At 1 January 2015 |
35,890 |
23,746 |
20,214 |
79,850 |
Charge for the year |
2,664 |
166 |
7,025 |
9,855 |
At 31 December 2015 |
38,554 |
23,912 |
27,239 |
89,705 |
|
|
|
|
|
Net book value |
|
|
|
|
At 31 December 2015 |
3,941 |
659 |
9,222 |
13,822 |
|
|
|
|
Net book value |
|
|
|
|
At 31 December 2014 |
5,412 |
188 |
16,247 |
21,847 |
|
|
|
|
|
14. Intangible
assets |
|
|
|
|
|
|
|
Group and
Company |
|
|
Patents |
|
|
|
£ |
Cost |
|
|
|
At 1 January 2014 |
|
|
299,893 |
Additions |
|
|
215,676 |
At 31 December 2014 |
|
|
515,569 |
|
|
|
|
Amortisation |
|
|
|
At 1 January 2014 |
|
|
92,749 |
Charge for the year |
|
|
42,280 |
At 31 December 2014 |
|
|
135,029 |
|
|
|
|
Net book
value |
|
|
|
At 31 December 2014 |
|
|
380,540 |
|
|
|
|
Net book
value |
|
|
|
At 31 December 2013 |
|
|
207,144 |
|
|
|
|
|
|
|
|
|
Group
and Company |
|
|
Patents |
|
|
|
£ |
Cost |
|
|
|
At 1 January 2015 |
|
|
515,569 |
Additions |
|
|
141,239 |
Impairment |
|
|
(174,944) |
At 31 December 2015 |
|
|
481,864 |
|
|
|
|
Amortisation |
|
|
|
At 1 January 2015 |
|
|
135,029 |
Charge for the year |
|
|
43,262 |
Impairment |
|
|
(40,412) |
At 31 December 2015 |
|
|
137,879 |
|
|
|
|
Net book
value |
|
|
|
At 31 December 2015 |
|
|
343,985 |
|
|
|
|
Net book
value |
|
|
|
At 31 December 2014 |
|
|
380,540 |
|
|
|
|
|
|
|
|
|
Intangible assets comprise the Group’s investment in patents to
protect RPL554. Patents are amortised over a period of ten years
and are regularly reviewed for impairment to ensure the carrying
amount exceeds the recoverable amount in accordance with note
2.10.
15.
Goodwill |
|
2015 |
2014 |
|
|
£ |
£ |
Group |
|
|
|
Goodwill |
|
1,469,112 |
1,469,112 |
Company |
|
|
|
Goodwill |
|
1,453,569 |
1,453,569 |
Goodwill represents the excess of the purchase price over the
fair value of the net assets acquired in connection with the
acquisition of Rhinopharma Limited in September 2006.
Goodwill is capitalised and allocated to appropriate research
projects, in Verona’s case RPL554. They are deemed to have
indefinite useful life and so are not amortised. Annual
impairment test of the research projects (‘RPs’) is performed by
comparing the expected recoverable amount of the RPs to the
carrying amount of the RPs.
Recognising that the Group is still in pre-revenue phase and
that the research projects are not yet ready for commercial use,
management assesses the recoverable amount of such goodwill with
reference to Verona’s market capitalisation. As at
31 December 2015 this was several
times the carrying value of goodwill. Accordingly management
believe it is appropriate to carry goodwill at full historical
value.
16. Called up share
capital
The movements in the share capital are summarised below:
|
|
Number of
shares |
£ |
Authorised: |
|
|
|
10,000,000,000 Ordinary shares of
0.1p each |
|
10,000,000,000 |
10,000,000 |
Allotted, called up and fully paid: |
|
|
|
Ordinary shares as at 1 January
2014 |
|
372,598,650 |
372,598 |
Ordinary shares issued from share
placement |
|
298,750,000 |
298,750 |
Ordinary shares issued from share
subscription |
|
292,000,000 |
292,000 |
Ordinary shares issued from share
open offer |
|
46,574,831 |
46,575 |
As at 31 December 2014 |
|
1,009,923,481 |
1,009,923 |
As at 31 December 2015 |
|
1,009,923,481 |
1,009,923 |
17.
Cash used in operating
activities |
|
|
2015 |
2014 |
|
|
£ |
£ |
Group |
|
|
|
Operating loss |
|
(8,971,007) |
(3,792,773) |
Share-based payment
charge |
|
398,943 |
192,186 |
Decrease /
(increase) in trade and other receivables |
|
57,633 |
(321,294) |
Increase in trade and
other payables |
|
1,274,370 |
34,993 |
Depreciation of plant
and equipment |
|
9,854 |
10,682 |
Write-off of intangible
assets |
|
134,533 |
- |
Amortisation of
intangible assets |
|
43,262 |
42,280 |
Cash used in operating activities |
(7,052,412) |
(3,833,926) |
|
|
|
|
|
|
|
|
Company |
|
|
|
Operating loss |
|
(9,010,081) |
(3,792,039) |
Share-based payment charge |
|
319,352 |
192,186 |
Decrease / (increase)
in trade and other receivables |
|
57,104 |
(322,016) |
Increase in trade and other
payables |
|
1,393,593 |
34,993 |
Depreciation of plant and
equipment |
|
9,854 |
10,682 |
Write-off of intangible
asset |
|
134,533 |
- |
Amortisation of intangible
assets |
|
43,262 |
42,280 |
Cash used in operating activities |
(7,052,383) |
(3,833,914) |
|
|
|
|
|
18. Related
parties transactions
The Company was charged £2,375,898 by Simbec-Orion, a group of
which Prof. Trevor Jones is a
Director. At the year end, the Company owed £172,955 to this
related party (2014: £Nil).
Arthurian Life Sciences Limited is also a company of which Prof.
Trevor Jones is a Director. At
the year end, the Company owed £nil to this related party (2014:
£23,040). The £23,040 owed as at the end of 2014 was settled
in early 2015. This was the only transaction with Arthurian
Life Sciences Limited in 2015.
Arthurian Life Sciences Limited acts as General Partner for the
Wales Life Sciences Investment Fund, which itself is a substantial
shareholder in the Company.
The Directors of the Company have authority and responsibility
for planning, directing and controlling the activities of the Group
and they therefore comprise key management personnel as defined by
IAS 24, Related Party Disclosures. Remuneration of Directors
is disclosed in the Directors’ emoluments report on page 15.
19.
Share-based payments
charge
Included within general and administrative costs is a
share-based payment charge of £398,943 (2014: £192,187). The share
based payment charge represents the current year’s allocation of
the expense for relevant share options between 2012 and 2015.
All options issued prior to 2012 are fully expensed. The
Company grants share options under an unapproved share option plan
(the 'Unapproved Plan') and under tax efficient Enterprise
Management Incentive arrangements (the 'EMI Plan'). Under the
Unapproved Plan, options are granted to employees, directors and
consultants to acquire shares at a price to be determined by the
Board. In general, options are granted at a premium to the
share price at the date of grant, vest over three years and are
exercisable during a period ending ten years after the date of
grant. Options are also issued to advisors under the
Unapproved Plan: such options generally vest immediately and are
exercisable between one and two years after grant. Under the EMI
Plan, options are granted to employees and directors who are
contracted to work at least 25 hours a week for the Company or for
at least 75% of their working time. The options granted under
the EMI Plan will be exercisable at a price and in accordance with
a vesting schedule determined by the Board at the time of grant and
will have an exercise period of 10 years from the date of
grant.
The Company granted 5,100,000 (2014: 9,500,000) share options
under the EMI Plan and 27,500,000 (2014: 15,500,000) share options
under the Unapproved Plan during the current year with total fair
values estimated using the Black-Scholes option-pricing model of
£370,542 (2014: £240,163). The cost is amortised over the vesting
period of the options on a straight-line basis and £173,131 is
included in the charge to general and administrative costs noted
above. The following assumptions were used for the
Black-Scholes valuation of share options granted in 2015, 2014,
2013, and 2012.
|
EMI Plan |
Unapproved Plan |
|
Issued in
2015 |
Issued
in 2015 |
Year/Type |
Employees |
Employees |
U.S.
Employee |
Options granted |
5,100,000 |
15,000,000 |
12,500,000 |
Risk-free interest rate |
1.42% |
1.42% |
1.42% |
Expected life of options |
10 years |
10 years |
10 years |
Annualised volatility |
76.5% |
76.5% |
76.5% |
Dividend rate |
0.00% |
0.00% |
0.00% |
|
EMI
Plan |
Unapproved Plan |
|
Issued in 2014 |
Issued in 2014 |
Year/Type |
Employees |
Employees |
Advisors |
Options granted |
9,500,000 |
5,500,000 |
10,000,000 |
Risk-free interest
rate |
2.46-2.53% |
2.53% |
1.71% |
Expected life of
options |
10
years |
10
years |
4
years |
Annualised
volatility |
70.6-78.9% |
70.6% |
89.5% |
Dividend rate |
0.00% |
0.00% |
0.00% |
|
EMI
Plan |
Unapproved Plan |
|
Issued in 2013 |
Issued in 2013 |
Year/Type |
Employees |
Employees |
Advisors |
Options granted |
2,500,000 |
13,000,000 |
5,655,717 |
Risk-free interest
rate |
2.0-2.8% |
1.7-2.3% |
0.4-0.5% |
Expected life of
options |
10
years |
10
years |
2
-3years |
Annualised
volatility |
53.3-72.4% |
80.0-81.9% |
70.5-122.1% |
Dividend rate |
0.00% |
0.00% |
0.00% |
|
EMI
Plan |
Unapproved Plan |
|
Issued in 2012 |
Issued in 2012 |
Year/Type |
Employees |
Employees |
Consultants |
Options granted |
5,000,000 |
300,000 |
300,000 |
Risk-free interest
rate |
0.97% |
0.97% |
0.97% |
Expected life of
options |
10
years |
10
years |
5
years |
Annualised
volatility |
75.56% |
82.36% |
82.36% |
Dividend rate |
0.00% |
0.00% |
0.00% |
The Company had the following share options movements in the
year:
|
|
Number of options |
|
|
Year of issue |
Exercise price (pence) |
At 1 January 2015 |
Options granted |
Options exercised |
Options lapsed |
At 31 December 2015 |
Expiry date |
|
|
2006 |
5 |
10,000,000 |
- |
- |
(2,000,000) |
8,000,000 |
18
September
2016* |
|
2010 |
9 |
500,000 |
- |
- |
(500,000) |
- |
15 June
2015 |
|
2012 |
5-15 |
5,000,000 |
- |
- |
- |
5,000,000 |
1 June
2022*** |
|
2013 |
4.8 |
5,000,000 |
- |
- |
- |
5,000,000 |
31
January 2016** |
|
2013 |
4 |
655,717 |
- |
- |
(655,717) |
- |
31
January 2015** |
|
2013 |
4 |
5,000,000 |
- |
- |
- |
5,000,000 |
15
April
2023 |
|
2013 |
4 |
1,000,000 |
- |
- |
- |
1,000,000 |
1
June
2023*** |
|
2013 |
4 |
8,000,000 |
- |
- |
- |
8,000,000 |
29 July
2023 |
|
2014 |
3.5 |
5,500,000 |
- |
- |
- |
5,500,000 |
15 May
2024 |
|
2014 |
3.5 |
3,500,000 |
- |
- |
- |
3,500,000 |
15 May
2024*** |
|
2014 |
2.2 |
6,000,000 |
- |
- |
- |
6,000,000 |
26
September 2024*** |
|
2014 |
2.2-3.5 |
10,000,000 |
- |
- |
- |
10,000,000 |
6 August
2018 |
|
2015 |
2.5 |
- |
5,100,000 |
- |
- |
5,100,000 |
29
January 2025*** |
|
2015 |
2.5 |
- |
27,500,000 |
- |
- |
27,500,000 |
29
January 2025 |
|
Total |
|
60,155,717 |
32,600,000 |
- |
(3,155,717) |
89,600,000 |
|
|
*10,000,000 directors’ options with expiry date on 18 September 2011 were extended for five years to
18 September 2016.
**options granted to agents upon closing of a Placing or
financing facility.
***options granted under the EMI Plan.
Outstanding and exercisable share options by Plans at
31 December 2015:
Plan |
Outstanding |
Exercisable |
WAEP (pence) |
Unapproved |
69,000,000 |
33,500,003 |
3.3 |
EMI |
20,600,000 |
8,833,335 |
4.3 |
Total |
89,600,000 |
42,333,338 |
3.6 |
The weighted average exercise price (WAEP) of options at the
year-end is as follows:
|
Number of
options |
Weighted average
exercise price (pence) |
As at 1 January 2014 |
38,755,717 |
5.5 |
|
|
|
Options granted in 2014: |
|
|
Employees and consultants |
3,500,000 |
3.5 |
Directors |
11,500,000 |
2.8 |
Placing agent |
10,000,000 |
2.6 |
Options lapsed in the year |
(3,600,000) |
8.3 |
As at 31 December 2014 |
60,155,717 |
4.2 |
|
|
|
Options granted in 2015: |
|
|
Employees |
3,100,000 |
2.5 |
Directors |
17,000,000 |
2.5 |
U.S. Employee |
12,500,000 |
2.5 |
Options lapsed in the year |
(3,155,717) |
5.4 |
As at 31 December 2015 |
89,600,000 |
3.6 |
|
|
|
Exercisable at 31 December
2015 |
42,333,338 |
4.5 |
20.
Loss of the parent company
The Parent has taken advantage of the exemption permitted by
Section 408 of the Companies Act 2006 not to present an income
statement for the year. The Parent Company's loss for the
year was £7,441,785 (2014: loss of £2,757,996), which has been
included in the Group’s income statement.
21. Control
The Company is not under the control of any individual or group
of connected parties.
22.
Financial commitments
As at 31 December 2015 the Group
and Company were committed to making the following payments under
non-cancellable operating leases in the year to 31 December 2016.
|
|
Land
and Buildings |
|
|
2015 |
2014 |
Operating leases which expire: |
|
£ |
£ |
Within one year |
|
151,240 |
151,248 |
23. Financial
instruments
(a) Fair values
The carrying amounts of cash and cash equivalents, short-term
investments, receivables, and accounts payable and accrued
liabilities, approximate to fair value due to their short-term
nature.
(b) Credit risk
Credit risk reflects the risk that the Group may be unable to
recover contractual receivables. The Group is still in the
development stage; therefore, no policies are required at this time
to mitigate this risk.
(c) Currency risk
Foreign currency risk reflects the risk that the Group’s net
assets will be negatively impacted due to fluctuations in exchange
rates. The Group has not entered into foreign exchange contracts to
hedge against gains or losses from foreign exchange fluctuations.
At 31 December 2015, cash and cash
equivalents include €3,503, US$8,315,
CAD$1,463, SEK4,299 and accounts payable and accrued
liabilities include balances of €276,981, US$98,654 and SEK2,218,684.
(d) Financial risk management
The Directors recognise that this is an area in which they may
need to develop specific policies should the Group become exposed
to further financial risks as the business develops.
(e) Management of capital
The Group considers capital to be its equity reserves. At the
current stage of the Group’s life cycle the Group’s objective in
managing its capital is to ensure funds raised meet the research
and operating requirements until the next development stage of the
Group’s suite of projects.
The Group ensures it is meeting its objectives by reviewing its
Key Performance Indicators (“KPIs”) to ensure its research
activities are progressing in line with expectations, controlling
costs and placing unused funds on deposit to conserve resources and
increase returns on surplus cash held.
(f) Interest rate risk
At 31 December 2015, the Group had
cash deposits of £3,524,387 (2014: £9,969,759). The Group’s
exposure to interest rate risk, which is the risk that a financial
instrument’s value will fluctuate as a result of changes in market
interest rates on classes of financial assets and financial
liabilities, was as follows:
Financial
Asset |
Floating
interest rate
2015 |
Fixed
interest rate
2015 |
Floating
interest rate
2014 |
Fixed
interest rate
2014 |
|
£ |
£ |
£ |
£ |
|
|
|
|
|
Cash deposits |
64,516 |
3,459,871 |
101,508 |
9,868,251 |