REG - Angle PLC - Business Update

AngleAnnouncement

05/01/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230105:nRSE7310La&default-theme=true

RNS Number : 7310L  Angle PLC  05 January 2023

 For immediate release  05 January 2023

 

ANGLE plc ("the Company")

 

BUSINESS UPDATE

 

ANGLE plc (AIM:AGL OTCQX:ANPCY), a world-leading liquid biopsy company, is
pleased to provide a review of business progress, an unaudited trading update
for 2022 and prospects for 2023.

 

2022: a breakthrough year

 

2022 has been a breakthrough year for ANGLE with the world's first FDA product
clearance for a system to harvest cancer cells from patient blood for
subsequent analysis following a sustained effort by the Company for over six
years including extensive dialogue and formal pre-submissions with FDA, and
the submission of over 400 technical reports and documents and processing of
over 16,000 samples to demonstrate system performance. This was followed by
ANGLE's pivotal ovarian cancer study delivering best in class results with
sensitivity and specificity of 90% and 93% respectively, far out-performing
standard of care for the detection of ovarian cancer demonstrating the value
of the Parsortix(®) system for real-world clinical decision-making.

 

These achievements have placed ANGLE in a strong position to play a leading
role in the emerging US$ 100 billion dollar liquid biopsy market for
personalised cancer care by providing intact cancer cells for analysis, the
"best sample" for guiding targeted treatment decisions, improving patient
outcomes and reducing healthcare costs. ANGLE is executing its strategy to
commercialise the Parsortix system with three core elements, a pharma services
business to utilise the Parsortix system in cancer drug trials to drive early
revenues, a corporate partnership business to combine Parsortix with
downstream analysis techniques and a product business with partners in
different geographies to provide a distribution channel for Parsortix
instruments and consumables.

 

Taking action to navigate market conditions

 

Like many businesses in the sector, ANGLE has been subject to wider economic
and market headwinds, which have worsened during the second half of the year.
Despite market conditions, in July 2022, ANGLE moved rapidly post FDA approval
to complete a capital raise of £20.1 million (£18.9 million net of expenses)
to support the Company's commercialisation plans through to mid-2024, and then
initiated a streamlining of the Company's operations in H2 to increase cash
runway further into H2 2024 in response to challenging market conditions.

 

This, along with proposed changes to the UK R&D Tax Credit scheme making
the cost of undertaking R&D in Canada 50% more expensive than in the UK,
led to the decision to close the Company's Canadian operations and centralise
all R&D at the Company's UK facilities. The Company has moved swiftly to
deliver this change and has recently completed an orderly wind down of the
Canadian facility.

 

The decision has also been taken to focus development of downstream molecular
analysis of Parsortix harvested cancer cells to third party platforms in
preference to the Company's inhouse HyCEAD Ziplex platform. The latter had
proved highly sensitive and successful in analysis of Parsortix liquid biopsy
samples but required significant ongoing investment to enable the assay to be
offered in a product format (as opposed to being limited to provision of a
service from ANGLE clinical laboratories). Meanwhile, third-party molecular
platforms have greatly improved in sensitivity and reduced in cost and now
offer an installed base of molecular products already in the market, which can
be leveraged for new Parsortix applications.

 

While the overall impact of wider market conditions has slowed down ANGLE's
commercial acceleration post FDA clearance, all aspects of the Company's
strategy and potential for the Parsortix system remain intact. The management
team is focusing the Company's resources carefully and expects 2023 to be a
further year of progress for ANGLE in preparation for rapid expansion, whilst
recognising this may take longer than previously anticipated until broader
market conditions stabilise.

 

2022 unaudited trading update and 2023 outlook

 

Actions taken to control the cost base and the closure of Canadian operations,
as described above, are on track to deliver the anticipated cost savings of
£2.6 million in 2023 and £4.0 million per annum thereafter. The closure has
resulted in c. £1 million of non-cash write-offs of intangible and tangible
assets and c. £1 million of closure costs.

 

Cash at year end 2022 is expected to be in line with expectations at c. £32
million and the Company has no debt. Reported revenue for the year ended 31
December 2022 is expected to be just above £1 million, while operating loss
for the year is estimated at c. £22 million and, excluding the one-off
closure costs for Canada, is also in line with expectations. Approximately
£0.5 million of revenue expected in 2022 is now expected to be recognised in
2023 due to delays outside the Company's control and a number of expected
sales were either delayed or impacted by the wider market backdrop.

 

Due to the current adverse market conditions, the need across the industry to
control expenditure has affected a number of pipeline opportunities with some
customers focusing on their nearer term assets with additional buyer caution.
Revenue for 2023 is expected to show strong growth but likely to be materially
below current market expectations.

 

Encouragingly, the Company has already seen several new orders confirmed in
the first week of January, which may reflect customers awaiting the start of
their new budget year. The pipeline for both pharma and product sales remains
strong and growing, with the Company's distributor network build out
progressing as planned. The Company remains confident in the opportunities for
the business, delivering on commercial milestones, building revenues and
controlling costs.

 

Growth opportunities

 

Significant expansion of the pharma services pipeline

 

The pharma services business continues to offer the potential for near term
revenues in the large cancer drug trials market where ANGLE is clearly
differentiated. The FDA clearance has helped open doors to pharma and the
pipeline of potential pharma services customers has expanded significantly.
There are now multiple new customers and projects in discussion, including
with major pharma companies. As previously indicated, the sales process for
pharma services can be prolonged and market conditions have delayed completion
of some of these new opportunities. We have found a high level of repeat
business opportunities with existing customers and prospects remain very
positive for rapid growth of this business. We look forward to providing
further updates in the future.

 

Progress with laboratory accreditations

 

To support its pharma services business, ANGLE has been seeking regulatory
accreditation of its clinical laboratories in the United States and UK. ANGLE
is pleased to report that ISO 15189 Accreditation has been received for the
United States laboratory and is expected for the UK laboratory shortly. This
is an important achievement and demonstrates that ANGLE's clinical
laboratories maintain globally recognised quality standards. This is
particularly relevant for pharma services customers that require evidence that
the laboratories are stable, robust, compliant, and subject to periodic
external inspections by recognised organisations. Registration and preparation
is also complete for CLIA accreditation, which is required for patient
management in the United States, and the process will be completed once the
first laboratory developed tests (LDTs) are being offered from the
laboratories, which is a requirement.

 

Corporate partnerships

 

ANGLE is in discussions with several potential parties regarding the
development of an assay for HER-2 analysis in breast cancer. The impetus for
this programme has increased with the recent developments in relation to the
approval of drugs for "HER-2 low" status.

 

Following a review of third-party molecular systems, ANGLE has focused its
resources on evaluating the performance of Parsortix samples in combination
with multiple third-party downstream DNA and RNA sequencing technologies.
Initial results from these evaluations have been highly encouraging and ANGLE
believes this will open the door to partnering discussions with these
technology providers, who are keen to add "content" to their product menus.

 

Building a network of distribution partners

 

With a view to driving longer term product revenues, during the year ANGLE has
expanded its commercial operations team, including product management,
logistics, service and maintenance, and, following the FDA clearance, has
successfully established agreements to build an international network of
oncology focused distribution partners in Europe, including Germany, Austria,
Czech Republic, Switzerland and France, the Middle East, China, India and New
Zealand, with other geographies in discussion. These partners all provide
valuable sales, implementation and ongoing service and maintenance support in
their chosen markets. We expect product sales to build gradually with
expansion being stimulated over time by downstream assays, clinical utility
and reimbursement processes.

 

Developing assays to support adoption

 

To support adoption of its technology by adding "content", ANGLE has been
developing a suite of imaging assays (branded Portrait(+)) and molecular
assays (branded Landscape(+)) to analyse the cancer cells harvested by the
Parsortix system. These assays are designed to build a menu for ANGLE's pharma
services business and to be sold as products for third-party customers through
the growing distribution network for use with the Parsortix system.

 

Refining plans for ovarian cancer assay

 

Following the excellent results from its ovarian cancer study, ANGLE has
carefully considered the most appropriate commercial route for this test. With
a view to maximising commercial potential and recognising the improvement in
sensitivity and reduction in costs of other molecular systems with an
established installed base, the Landscape(+) Ovarian assay will now be
optimised utilising a third-party molecular analysis platform. Several
candidates are currently being evaluated. Validation of the optimised assay
can be undertaken utilising patient samples stored from the already completed
studies. The major advantage of this approach is it will leverage the third
party installed base providing them with "content" and will allow a larger
scale product-based commercialisation strategy for ovarian cancer
substantially increasing market potential and the rate of adoption.

 

Progress with prostate cancer studies

 

ANGLE is also moving ahead with its prostate cancer studies utilising the
Parsortix system to assess the presence and severity of prostate cancer via a
blood test in collaboration with Solaris Health Holdings, LLC / MidLantic
Urology LLC. Studies are expected to complete in 2023 with a view to Solaris
marketing a Parsortix prostate cancer test to its patient base of over 729,000
unique patients annually.

 

ANGLE Founder and Chief Executive, Andrew Newland, commented:

"It has been a breakthrough year for ANGLE, with both FDA clearance and
excellent results from the ovarian cancer study. Whilst we have not yet seen
the expected acceleration in revenue, the pipeline of opportunities is growing
strongly and we are encouraged by the level of engagement with pharma
companies, including major pharma companies, medtech companies and clinical
laboratories globally. ANGLE has the resources in place to deliver on its
strategic and commercial plans and starts the new year cautiously optimistic
despite the challenging market."

 

For further information:

 

 ANGLE plc                                   +44 (0) 1483 343434
 Andrew Newland, Chief Executive

 Ian Griffiths, Finance Director

 Andrew Holder, Head of Investor Relations

 Berenberg (NOMAD and Joint Broker)          +44 (0) 20 3207 7800

 Toby Flaux, Ciaran Walsh, Milo Bonser

 Jefferies (Joint Broker)                    +44 (0) 20 7029 8000

 Max Jones, Thomas Bective

 FTI Consulting

 Simon Conway, Ciara Martin                  +44 (0) 203 727 1000

 Matthew Ventimiglia (US)                    +1 (212) 850 5624

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the EU Market Abuse
Regulation (596/2014). Upon the publication of this announcement via a
regulatory information service, this information is considered to be in the
public domain.

 

For Frequently Used Terms, please see the Company's website on
https://angleplc.com/investor-relations/glossary/
(https://angleplc.com/investor-relations/glossary/)

 

Notes for editors

 

About ANGLE plc www.angleplc.com (http://www.angleplc.com)

ANGLE is a world leading liquid biopsy company with sample-to-answer
solutions. ANGLE's proven patent protected circulating tumor cell (CTC)
harvesting technology is known as the Parsortix(®) system.

 

ANGLE's Parsortix(®) system is FDA cleared for its intended use in
metastatic breast cancer and is currently the first and only FDA cleared
medical device to harvest intact circulating cancer cells from blood.

 

Intended use

The Parsortix(®) PC1 system is an in vitro diagnostic device intended to
enrich circulating tumor cells (CTCs) from peripheral blood collected in
K(2)EDTA tubes from patients diagnosed with metastatic breast cancer. The
system employs a microfluidic chamber (a Parsortix cell separation cassette)
to capture cells of a certain size and deformability from the population of
cells present in blood. The cells retained in the cassette are harvested by
the Parsortix PC1 system for use in subsequent downstream assays. The end user
is responsible for the validation of any downstream assay. The standalone
device, as indicated, does not identify, enumerate or characterize CTCs and
cannot be used to make any diagnostic/prognostic claims for CTCs, including
monitoring indications or as an aid in any disease management and/or treatment
decisions.

 

The Parsortix system enables a liquid biopsy (a simple blood test) to be used
to provide the circulating metastatic breast cancer cells to the user in a
format suitable for multiple types of downstream analyses. The system is based
on a microfluidic device that captures cells based on a combination of their
size and compressibility. The system is epitope independent and can capture
all phenotypes of CTCs (epithelial, mesenchymal and EMTing CTCs) as well as
CTC clusters in a viable form (alive). CTCs harvested from the system enable a
complete picture of a cancer to be seen; as being an intact cell they allow
DNA, RNA and protein analysis as well as cytological and morphological
examination and may provide comparable analysis to a tissue biopsy in
metastatic breast cancer. Because CTC analysis is a non-invasive process,
unlike tissue biopsy, it can be repeated as often as needed. This is important
because cancer develops and changes over time and there is a clear medical
need for up-to-date information on the status of a patient's tumor. In
addition, the live CTCs harvested by the Parsortix system can be cultured,
which offers the potential for testing tumor response to drugs outside the
patient.

 

The Parsortix technology is the subject of 26 granted patents in Europe, the
United States, China, Australia, Canada, India, Japan and Mexico with three
extensive families of patents are being progressed worldwide.

 

In the United States, the Parsortix(®) PC1 system has received a Class II
Classification from FDA for use with metastatic breast cancer patients. FDA
clearance is seen as the global gold standard. ANGLE's Parsortix system is the
first ever FDA cleared system for harvesting CTCs for subsequent analysis.
ANGLE has applied the IVD CE Mark to the same system for the same intended use
in Europe.

 

ANGLE has also completed three separate 200 subject clinical studies under a
programme designed to develop an ovarian cancer pelvic mass triage test, with
the results showing best in class accuracy (AUC-ROC) of 95.4% with sensitivity
of 90% and specificity of 93%. This excellent clinical result demonstrates the
utility of cells harvested by the Parsortix system, which the Company believes
is the "best sample" for liquid biopsy analysis as it recovers intact, living
cancer cells that are involved in the progression of the disease providing
prospective information.

 

ANGLE has established formal collaborations with world-class cancer centres
and major corporates such as Abbott, Philips and QIAGEN, and works closely
with leading CTC translational research customers. These Key Opinion Leaders
(KOLs) are working to identify applications with medical utility (clear
benefit to patients), and to secure clinical data that demonstrates that
utility in patient studies. The body of evidence as to the benefits of the
Parsortix system is growing rapidly from our own clinical studies in
metastatic breast cancer and ovarian cancer and also from KOLs with 76
peer-reviewed publications and numerous publicly available posters from 33
independent cancer centres, available on our website.

 

ANGLE has established clinical services laboratories in the UK and the United
States to accelerate commercialisation of the Parsortix system and act as
demonstrators to support product development. The laboratories offer services
globally to pharmaceutical and biotech customers for use of Parsortix in
cancer drug trials and, once the laboratories are accredited and tests
validated, will provide Laboratory Developed Tests (LDTs) for patient
management.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDFFFLFLAISIIV