REG - BiVictriX Therapcts. - BiVictriX Full Year Results
30/03/2023 07:00
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RNS Number : 6992U BiVictriX Therapeutics PLC 30 March 2023
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BIVICTRIX THERAPEUTICS PLC
("BiVictriX" or "the Company" or "the Group")
Full year results for the twelve months ended 31 December 2022
· Good progress towards identifying a clinical candidate
· Broadening and strengthening the Company's pipeline portfolio
· Expansion of scientific capabilities and premises
Alderley Park, 30 March 2023 - BiVictriX Therapeutics plc (AIM: BVX), an
emerging biotechnology company applying a novel approach to develop
next-generation cancer therapies with improved tolerability and anti-cancer
activity, today announces its audited full year results for the twelve months
ended 31 December 2022.
The Annual Report is available to review on the Company's website and hard
copies will be posted to shareholders shortly.
Corporate Highlights including post period end events
• Identified a development lead for the BVX001 programme which will be
progressed to in vivo studies
• Expanded the therapeutic pipeline with two additional programmes, BVX002 and
BVX003, both entering the early stages of drug development
• Developed a unique, state-of-the-art, Bi-Cygni® discovery engine that will
feed the Company's growing proprietary Bi-Cygni® library, IP portfolio and
expanding therapeutic pipeline
• Expanded the newly established internal R&D premises at Alderley Park, UK,
to incorporate a dedicated protein expression division and biomarker discovery
unit
• Post period, the Company announced the appointment of Dr. Michael Kauffman as
Non-Executive Chairman
• Post period, the Company reported positive preclinical data with the BVX001
programme, demonstrating a highly favourable safety profile compared to
Mylotarg(TM) in an in vivo model assessing the risk for bone marrow toxicity
and neutropenia
Financial highlights
• Increased investment in R&D of £2.1 million (2021: £0.7 million)
• Loss after tax of £2.5 million (2021: £2.3 million)
• Closing cash balance of £3.3 million at 31 December 2022 (2021: £6.1
million)
Tiffany Thorn, Chief Executive Officer of BiVictriX, commented: "We have made
signficant progress over the past year with our lead programme, BVX001,
advancing this candidate towards the clinic. In addition to identifying a
development lead for BVX001, at the beginning of this year we reported a
highly favourable safety profile in a preclinical study comparing two doses of
BVX001 to the only currently approved ADC indicated for AML. Beyond BVX001,
we've diversified our pipeline with the addition of two additional programmes,
BVX002 and BVX003, to our portfolio. Further, we've established of our new
wholly-owned Bi-Cygni® discovery engine, laying the groundwork for future
expansion and value creation in the years ahead."
For more information, please contact:
BiVictriX Therapeutics plc
Tiffany Thorn, Chief Executive Officer Email: info@bivictrix.com
SP Angel Corporate Finance LLP (NOMAD and Broker) Tel: +44 (0) 20 3470 0470
David Hignell, Kasia Brzozowska (Corporate Finance)
Vadim Alexandre, Rob Rees (Sales and Broking)
Panmure Gordon (UK) Limited (Joint Broker) Tel: +44 (0) 20 7886 2500
Rupert Dearden/Freddy Crossley/Emma Earl
Consilium Strategic Communications
Mary-Jane Elliott, Namrata Taak, Tel: +44 (0) 20 3709 5700
Genevieve Wilson, Emmalee Hoppe Email: Bivictrix@consilium-comms.com
About BiVictriX Therapeutics plc
BiVictriX is a UK-based drug discovery and development company which is
focused on leveraging clinical experience to develop a new class of highly
selective, next generation cancer therapeutics which exhibit superior potency,
whilst significantly reducing treatment-related toxicities.
The Company utilises a first-in-class approach to generate a proprietary
pipeline of Bi-Cygni® Antibody Drug Conjugate therapeutics which are designed
to selectively target cancer-specific antigen pairs, or "Bi-Cygni®
fingerprints", on tumour cells, which are largely absent from healthy cells.
BiVictriX has established a growing proprietary library of cancer-specific
Bi-Cygni® fingerprints, which enable the Company to target a diverse array of
different cancer types. The Company utilises these novel Bi-Cygni®
fingerprints, together with the Company's novel Antibody Drug Conjugate
therapeutic design, to develop more effective and safer therapeutics to target
cancers that are expected to constitute orphan indications and areas of high
unmet medical need.
Find out more about BiVictriX online at www.bivictrix.com
(http://www.bivictrix.com)
Chairman's Statement
For the year ended 31 December 2022
I am delighted to report on the Company's most recent and notable developments
and am confident that we will continue to see significant progress with our
pipeline over the coming year as we advance towards the clinic.
Since joining BiVictriX in 2021, my role has focused on supporting our CEO,
Tiffany Thorn, and the Company in establishing a strong foundation from which
it can develop and mature into a meaningful biotech company. It is my belief
that, over the past 12 months, we have achieved this across all aspects of the
business, in line with the Company's goals laid out at the time of the last
statement.
We have produced promising in vitro safety and efficacy data, resulting in the
identification of a development lead for the BVX001 programme and marking a
significant step forward towards progressing this programme to the clinic.
We have successfully built upon our existing internal R&D capabilities,
incorporating a fully functional protein expression laboratory to satisfy our
tumour-selective bispecific antibody (Bi-Cygni®) requirements across both the
lead programme and broader pipeline.
In addition, in pursuit of our aim to decrease the development time from
discovery to lead selection, we established our own unique Bi-Cygni®
discovery engine which enables the expansion of our library of proprietary
cancer-selective fingerprints, using patient-derived next-generation
sequencing data.
During the period, the Company expanded its development pipeline to include
two new programmes, BVX002 & BVX003, which have entered discovery. These
programmes target a spectrum of solid tumour and haematological cancer
indications, demonstrating the broad utility of the Bi-Cygni® concept as a
first-in-class approach to better cancer treatment. Selection of development
leads for the two new programmes, together with further patent filings, is
anticipated during the next year.
We have continued to maintain tight control of our finances and have been both
robust and prudent with the use of shareholders' funds. In terms of governance
and oversight during the year, we strengthened the Board with the appointment
of Dr Michael Kauffman, who broadens the Board's capabilities and experience
by providing his expertise in preclinical research, clinical development, and
regulatory strategy. Recently, we announced that I am handing over the
Chairman role to Michael. I look forward to remaining with the Company as a
member of the Board and continuing as a supportive shareholder. It has been
a privilege to serve BiVictriX as Chairman since 2021, through the Company's
initial public offering in August 2021 and the significant progress made
since.
In summary, the journey of any biotech company is often non-linear, but we
have nevertheless continued to make great progress in the past year, which has
proven very challenging for many small biotech companies. We have built an
effective, fit-for-purpose R&D team with expanded capabilities, and
broadened our know-how in the business. A development lead for the BVX001
programme was selected in December 2022, and we have expanded our discovery
capabilities along with our development pipeline, which we believe over time
will address substantial numbers of patients with cancers and thus represent
very substantial commercial markets. The fundamentals of this business remain
strong and I am confident we will make substantial progress in the coming
year.
I would like to thank all my fellow Directors and our terrific team in
Alderley Park, UK, led by our exceptional CEO, Tiffany Thorn, for all their
efforts over the past year. And, as always, we remain grateful for the ongoing
support of our shareholders, whose faith in the company makes possible
everything we do.
Iain Ross
Former Non-Executive Chairman - (August 2021 - January 2023)
29 March 2023
Chief Executive Officer's Review
For the year ended 31 December 2022
It is with great pleasure that I am delivering the Company's second Annual
Report as CEO of BiVictriX Therapeutics plc, following our IPO in 2021. I am
delighted to share the meaningful recent progress that we have made in
advancing our state-of-the-art approach to developing more effective and safer
anti-cancer therapeutics. The original idea I had while serving as a Clinical
Immunologist in the NHS is moving ever closer to delivering value in a patient
setting and offering a potentially "game-changing" approach to cancer
treatment. This would not be possible without the continued and valued support
of our dedicated staff and shareholders, to whom I am extremely grateful for
their enthusiasm and belief in BiVictriX.
The business
BiVictriX is a UK-based drug discovery and development company with a vision
to revolutionise cancer therapy for some of the most difficult to treat
cancers. The Company is focused on applying our innovative, proprietary
Bi-Cygni® approach to develop a new class of highly selective,
next-generation cancer therapeutics which exhibit superior potency, whilst
substantially reducing treatment-related toxicities by greatly improving the
specificity of these molecules for targeting the cancer. Our lead programme,
BVX001, is focused on Acute Myeloid leukaemia ("AML"), one of the most
aggressive forms of blood cancer which, to this day, carries an incredibly
poor prognosis, leading to death in 60%-90% of adult cases depending on the
patient's age.
Bi-Cygni®: A game-changing approach to treat cancer
Bi-Cygni® is a unique, proprietary platform which combines the discovery of
novel, cancer-selective twin-antigen pairs or "fingerprints" (typically two
different proteins), with our expert bispecific antibody engineering insights;
to create a new class of highly selective, next-generation anti-cancer
therapeutics. Together with our proprietary library of these newly identified
cancer-specific fingerprints, which are found to be aberrantly present on
tumour cells, but largely absent from normal, healthy cells; we develop
first-in-class obligate bispecific therapeutics (Bi-Cygni® therapeutics) that
are exquisitely cancer-selective.
Because our first-in-class Bi-Cygni® therapeutics have high selectivity for
cancer cells with reduced toxicity on normal cells, we have the potential to
generate a pipeline of anti-cancer drugs across both solid and haematologic
cancers with the widest therapeutic windows. Consequently, these drugs have
the potential to reduce the development of treatment-limiting (and sometimes
life-threatening) toxicities and enable clinicians to give patients higher,
more effective doses of therapy over prolonged periods in order to improve
both depth and duration of anti-tumour responses with reduced likelihood of
causing harm.
Since establishing operations in 2017, the Company has maintained its vision
to combine our unique innovations in therapeutic design with established,
clinically validated, therapeutic modes of action. Applying advances in our
understanding of precision targeting through the Bi-Cygni® platform to the
established, highly potent Antibody Drug Conjugate "ADC" concept enables us to
generate a broad pipeline of next generation ADC therapeutics which could
deliver increased tumour cell kill while reducing effects on normal cells.
Thus, my fellow directors and I believe that in the clinic, these therapeutics
will have the potential to deliver very high response rates and longer-term
tolerability over and above the standard ADC design, while effectively
reducing early developmental risk and time-to-market. This will enable, for
the first time, the broader utilisation of this therapeutic class across a
wider range of difficult-to-treat solid tumour and haematologic cancers.
Key achievements in 2022
Following our IPO on to the AIM market of the London Stock Exchange in 2021,
which was recognised as Investment Deal of the Year at Bionow's 20(th) annual
awards, I am pleased to report the Company has continued to make
value-creating progress in line with our strategy in what has been a
significant year for the ADC space. We continue to utilise the net proceeds of
our £7.5 million fundraise at the time of IPO with care and precision,
ensuring absolute priority is given to the progression of our R&D
programmes and to meeting the corporate goals. We have made good progress in
the period in meeting these goals, which include:
• building a fit-for-purpose internal R&D team to ensure value-creation and
know-how is retained in the business;
• identifying a development lead for the BVX001 programme to accelerate
progression towards the clinic; and
• expansion of our early-stage pipeline and growth of our IP portfolio, with the
development of a novel "Bi-Cygni® discovery engine" - utilising
state-of-the-art, patient-derived, next-generation sequencing data, with the
addition of two further candidates to our pipeline.
A more detailed description of our progress and key drivers follows below.
Board of Directors
On 6 January 2023, post period end, we announced that Dr. Michael Kauffman,
M.D., Ph.D. has been appointed as Non-Executive Chairman of BiVictriX. Dr.
Kauffman took over the role from Iain Ross, who will continue as a
Non-Executive Director at BiVictriX and stepped down from the role of Chairman
due to his additional responsibilities at ReNeuron Group plc.
Dr Kauffman takes over the reins as Non-Executive Chairman at a crucial time
for the Company, as we plan to progress our BVX001 development lead into the
clinic. Since his appointment to the Board of Directors in January 2022, Dr
Kauffman has seen the business progress the lead drug candidate from an
early-stage asset towards a clinical candidate. Having been instrumental in
the approval of several oncology therapeutics over twenty five years of
working across preclinical research, clinical development, regulatory strategy
and commercialisation, he is very well placed to draw from his experience as a
highly seasoned cancer drug developer to support the business as we progress
the asset towards clinical development and commercialisation.
As Non-Executive Chairman, Dr Kauffman will utilise his previous experience as
Co-Founder and Chief Executive Officer of oncology company Karyopharm
Therapeutics Inc., which he guided from a discovery stage biotechnology
company to a commercial stage organisation, achieving global approvals of
XPOVIO®. He also led the Kyprolis® development programme at Proteolix and
then Onyx Pharmaceuticals, the Velcade® development programme at Millennium
Pharmaceuticals, and has held a number of senior positions at Millennium
Predictive Medicine and Biogen, and other companies.
I would like to personally thank Iain Ross for his commitment and support of
the business, his mentorship and his valued guidance in helping to take the
Company from a private entity to a publicly listed business during our IPO in
August 2021. I look forward to continuing to work closely with Iain and
Michael, together with our wider group of seasoned Non-Executive Directors, as
we look to navigate the Company towards commercial success.
Internal R&D capabilities
In 2022, we expanded our newly established internal R&D premises to
incorporate a dedicated protein expression division. This additional
capability will be key in reducing timelines from discovery to the
identification of development leads, across the pipeline. In addition, the new
division will expand and diversify internal know-how surrounding the
development of novel bispecific antibody formats, a key aspect of our
approach. Ultimately, this will reduce the time-to-market and increase patent
life for each asset, as well as drive further value in the platform offering
of the business.
To support our expanded internal capabilities and our growing pipeline, during
the period we continued to build our dedicated team of experienced scientific
staff. This included the recruitment of four exceptional scientists to provide
support across each of the three internal R&D divisions at BiVictriX:
namely protein expression, bioconjugation and biology/biomarker discovery.
Scientific progress
We have continued to make good progress during the period through the
optimisation of BVX001, our lead therapeutic development programme. In
December 2022, we announced that we have successfully identified a development
lead for this programme, which is a substantial step forward in identifying a
final clinical candidate - a milestone which we anticipate meeting later this
year.
As the first asset utilising our proprietary Bi-Cygni® approach, navigating
the clinical development landscape for a completely novel drug candidate was
always going to require careful preparation and planning. I am pleased to
report that the Company has made great progress in identifying a suitable and
timely development path, in conjunction with support and guidance from our
regulatory advisors, which we believe will ensure a streamlined path to the
clinic for this asset. This will effectively set the precedent and will aim to
reduce time-to-market for all future pipeline assets aligned to this approach.
The development lead identified for the BVX001 programme was selected based on
a highly encouraging and comprehensive in vitro data package. The data package
report included positive readouts on cancer cell potency across different
target-expressing cell lines, improved cancer selectivity and safety studies
using human-derived healthy cells, as well as a suitable developability,
stability and manufacturing profile reported. As such assays, many of which
are proprietary, have been developed, established, and validated in house at
BiVictriX, they will also serve the entire pipeline of the Company. In
particular, we believe that these now established assays will help to drive
shorter timelines from discovery activities to selection of future asset
leads.
The development lead will now be further assessed in in vivo models of
efficacy to assess the optimised dosing regimen, data which is anticipated
later this year and will represent an exciting milestone for the business. The
results will support manufacturing preparation of material for human trials
and guide dosing in first-in-human studies to follow.
During the period, we have also made good progress with our proposed strategy
to expand the therapeutic pipeline and identify new ways in which we could
rapidly expand our proprietary Bi-Cygni® fingerprint library.
I am pleased to report that, through utilising patient-derived,
next-generation sequencing data and state-of-the-art bioinformatics
approaches, we have established a wholly-owned Bi-Cygni® discovery engine.
The Bi-Cygni® discovery engine enables the efficient discovery of a wide
range of novel, cancer-selective Bi-Cygni® fingerprints to feed our growing
proprietary library, IP portfolio and expanding therapeutic pipeline. The
discovery engine will serve an important, valued asset for the business and
will enable BiVictriX to progress the Bi-Cygni® platform further into areas
of significant unmet medical need and high commercial interest. Importantly,
the Bi-Cygni® discovery engine will enable the business to expand the utility
of the Bi-Cygni® concept across a wide range of solid tumour and
haematological cancer indications, while also enabling the Company to enter
new, well-sought-after markets, such as immuno-oncology. I believe this to be
a crucial step forward for the business as we look to increase our value
proposition aligned to our proprietary Bi-Cygni® concept and as we look
towards securing commercial partnerships with third parties.
Post period end, we reported positive preclinical safety data with BVX001 when
compared to Mylotarg(TM) - the only currently approved ADC indicated for AML.
In January 2023, we reported that in an in vivo model evaluating the risk for
bone marrow toxicity and neutropenia - a potentially life-threatening toxicity
linked to currently approved therapies in AML - BVX001 showed no adverse
effect to these healthy cells. The model was run head-to-head with
Mylotarg(TM) with BVX001 demonstrating a highly favourable safety profile when
compared to this commercial comparator. These results build upon the
previously documented excellent in vivo efficacy data and ex vivo safety data
reported for this programme
Commercial strategy
It is my belief, and that of the Board, that the Bi-Cygni® platform can be
applied to build a diverse pipeline of first-in-class therapeutics to treat a
wide range of solid tumour and haematological cancer indications, offering a
competitive therapeutic advantage to the existing milieu of drugs currently in
development and addressing key unmet needs in the market. BiVictriX's ambition
is to validate the Bi-Cygni® approach within a panel of difficult-to-treat
cancer indications, beginning with BVX001 in AML, to demonstrate the wide
applicability of the concept, propelling the Group forward as a global leader
in the field.
To realise maximum value, we are committed to ensuring the focused, expedient
development of our therapeutic pipeline towards reaching key value inflection
points, subsequently validating the wide utility of our proprietary Bi-Cygni®
approach to treat multiple cancer types. Alongside this, we aim to further
strengthen and grow our broad patent portfolio through the newly established
Bi-Cygni discovery engine, safeguarding both current and future
cancer-specific fingerprints for the Group, or our chosen partners. In
addition, a number of our now established in-house assays represent trade
secrets and provide further barriers to entry for potential competitors.
We are strongly focused on utilising our capital efficiently to secure
value-enhancing milestones across our therapeutic products and wider platform,
which will enable us to target commercial partnerships, including licensing
agreements.
BVX001, as our lead asset, will be important in providing validation to the
market for the wider Bi-Cygni platform. I believe there are three key
milestones within the development pathway for our lead, namely nominating a
clinical candidate, achieving IND approval and establishing early clinical
proof of concept through an initial Phase I/II clinical trial. The first
value-enhancement for BVX001 is on track to be achieved during 2023. The Board
believes that nomination of a clinical candidate will have the potential to
attract third party interest, including from pharma and mid-sized biotech
companies operating within the sector, who may be interested in partnerships
and/or licensing opportunities, providing long-term revenue streams to
BiVictriX.
As we near completion of this major corporate milestone, we will continue to
increase visibility of the Company at major sector conferences, building upon
our well-received presentations and active involvement at the Immuno-Oncology
Summit Europe and PEGS Europe during the period, together with our upcoming
presentation at PEGS Boston in 2023. We were delighted to be included,
nominated, and recognised for a variety of awards in 2022, notably EY's
Entrepreneur of the Year and the European Mediscience Awards, in the 'Emerging
Star' category. To enable the Company to actively seek out and explore
potential opportunities in the near term, we will also bring onboard
additional resource.
While we have had some early interest in our platform, our aim is to strike a
balance between demonstrating commercial value of both our platform and our
specific programmes, with an appropriate deal structure for the Company and
our stakeholders. We, as a Company and Board, believe that our position to
negotiate an appropriate deal structure for the lead asset will be
strengthened by the continued development of the wider pipeline alongside the
further development of BVX001. Therefore, in order to expedite the development
of the lead asset and to ensure the Company is in a strong position to find
the most appropriate partnership structure, we will also seek early-stage
partnerships within specified territories which may provide additional
financial support to move the asset forward within the shortest timeframe.
Immediate goals
Through our expanding pipeline, broad patent portfolio and internal know-how,
the Company is well positioned to target multiple early-stage, preclinical
partnership opportunities on the wider pipeline.
To succeed at achieving these goals we are focused on delivering upon the
following key milestones:
· Nomination of a clinical candidate for the BVX001 programme based on
in vivo efficacy data, anticipated during 2023;
· Identification of development leads for BVX002 and BVX003 within the
next 12 months;
· Consolidation of the intellectual property landscape surrounding
further potential cancer-specific Bi-Cygni® fingerprints, supported by the
newly established discovery engine;
· Bringing onboard dedicated business development resource to actively
seek out appropriate partnership opportunities for the BVX001 and/or other
programmes; and
· Securing key discovery-stage collaborations with industry and
academia to expand the Bi-Cygni® platform across other therapeutic
platforms/other therapeutic indications.
Financials
Management controls operate across the business to ensure that our financial
resources are prioritised towards the further development of the Company's
therapeutic programmes and platform to reach the key value points outlined
above.
This focus was reflected in the R&D expenditure which increased to £2.1
million (2021: £0.7 million) in the year and a loss after tax of £2.5
million (2021: £2.3 million).
We added to our internal laboratory capabilities by investing a further £241k
(2021: £64k) in laboratory equipment.
The Group ended the year with a cash balance of £3.3 million (2021: £6.1
million)
Summary and outlook
I am very encouraged by the progress we have made during the period, including
the progression of our lead therapeutic programme and the further
strengthening of our IP portfolio; together with the positive strides we have
made in future-proofing the business through the establishment of the
Bi-Cygni® discovery engine, expansion of the pipeline and broadening of our
internal capabilities and know-how. As we draw closer to reaching key value
inflection points during 2023, our focus will be on increasing the visibility
of the Company and showcasing our clear value proposition to potential
third-party collaborators.
I remain fully committed to our business goals, our continued delivery against
objectives and to prioritising the use of proceeds to create further
significant value in the Company and to provide multiple potential
opportunities for financial return to our valued shareholders.
Finally, and on a personal note, I would like to thank our exceptional
scientific team for their enthusiasm, commitment and hard work over the past
twelve months, for which our progress to date would not have been possible,
the Board for their guidance throughout the period and of course, our
shareholders for their much valued continued support and investment in our
business.
Tiffany Thorn
Chief Executive Officer
29 March 2023
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2022
Year Ended Year Ended
31 Dec 2022 31 Dec 2021
Notes
£'000 £'000
Operating expenses
Research and Development 3 (2,110) (711)
General and Administration 3 (738) (567)
Share based compensation 14 (127) (224)
Total operating expenses before non-recurring costs (2,975) (1,502)
Non-recurring costs 3 - (389)
Operating loss (2,975) (1,891)
Finance income/(cost) 4 (641)
Loss on ordinary activities before taxation (2,971) (2,532)
Taxation 6 474 192
Loss and total comprehensive expenses attributable to equity holders of the (2,497) (2,340)
parent for the year
Loss per share attributable to equity holders of the parent (pence) 7
Basic loss per share (pence) (3.78) (6.02)
Diluted loss per share (pence) (3.78) (6.02)
Consolidated and Company Statements of Financial Position
as at 31 December 2022
Group Company
As at As at As at As at
31 Dec 2022 31 Dec 2021 31 Dec 2022 31 Dec 2021
£'000 £'000 £'000 £'000
Notes
Assets
Non-current assets
Property, plant and equipment 8 571 339 - -
Investment in subsidiary undertakings 9 - - 214 214
Amounts receivable from - - 5,173 2,906
subsidiaries
Total non-current assets 571 339 5,387 3,120
Current assets
Trade and other receivables 10 224 287 74 11
Current tax receivable 454 192 - -
Cash and cash equivalents 11 3,287 6,063 3,002 5,500
Total current assets 3,965 6,542 3,076 5,511
Total assets 4,536 6,881 8,463 8,631
Liabilities and equity
Current liabilities
Trade and other payables 12 284 308 43 2
Lease liabilities 15 107 71 - -
Total current liabilities 391 379 43 2
Non-current Liabilities 188 175 - -
Total Liabilities 579 554 43 2
Equity
Ordinary shares 13 661 661 661 661
Share premium 13 12,052 12,052 8,002 8,002
Share based compensation 13 351 224 351 224
Warrant reserve 13 73 73 73 73
Merger reserve 13 (2,834) (2,834) - -
Retained losses 13 (6,346) (3,849) (667) (331)
Total equity attributable to equity holders of the parent 3,957 6,327 8,420 8,629
Total liabilities and equity 4,536 6,881 8,463 8,631
No Statement of Comprehensive Income is presented in these financial
statements for the parent company as provided by Section 408 of the Companies
Act 2006. The loss for the financial year dealt with in the financial
statements of the parent company was £345k (2021: £331k).
The financial statements were approved by the Board of Directors and
authorised for issue on 29 March 2023 and were signed on its behalf by:
Michael
Kauffman
Tiffany Thorn
Chairman
Chief Executive Officer
29 March 2023
BiVictriX Therapeutics plc
Registered number: 13470690
Consolidated Statement of Changes in Equity
for the year ended 31 December 2022
Ordinary shares Share Premium Merger reserve Share based compensation Warrant reserve Fair Value Reserve Retained deficit Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 31 December 2020 1 1,428 - 10 - 147 (1,519) 67
Total comprehensive expense for the period - - - - - - (2,340) (2,340)
Transactions with owners
Acquisition of BiVictriX Limited 212 2,622 (2,834) - - - - -
Share issue - convertible loan notes 73 1,387 - - - (147) - 1,313
Share issue - cash 375 7,125 - - - - - 7,500
Expense of share issue - (437) - - - - - (437)
Share based compensation - share options - - - 224 - - - 224
Issue of warrants - (73) - - 73 - - -
Share based compensation -lapsed options - - - (10) - - 10 -
Total transactions with owners 660 10,624 (2,834) 214 73 (147) 10 8,600
Balance at 31 December 2021 661 12,052 (2,834) 224 73 - (3,849) 6,327
Total comprehensive expense for the period (2,497) (2,497)
Transactions with owners
Share based compensation - share options 127 127
Total transactions with owners - - - 127 - - - 127
Balance at 31 December 2022 661 12,052 (2,834) 351 73 - (6,346) 3,957
Company Statement of Changes in Equity
for the year ended 31 December 2022
Attributable to equity holders of the parent
Ordinary shares Share premium Share based compensation Warrant reserve Fair Value Reserve Retained deficit Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 31 December 2020 - - - - - - -
Total comprehensive expense for the period - - - - - (331) (331)
Transactions with owners
Share issue - acquisition of BiVictriX Limited 213 - - - - - 213
Share issue - convertible loan notes 73 1,387 - - - - 1,460
Share issue - cash 375 7,125 - - - - 7,500
Expense of share issue - (437) - - - - (437)
Share based compensation - share options - - 224 - - - 224
Share based compensation - warrant reserve - (73) - 73 - - -
Total transactions with owners 661 8,002 224 73 - - 8,960
Balance at 31 December 2021 661 8,002 224 73 (331) 8,629
Total comprehensive expense for the period (336) (336)
Transactions with owners
Share based compensation - share options 127 127
Total transactions with owners 127 127
Balance at 31 December 2022 661 8,002 351 73 (667) 8,420
Consolidated and Company Statements of Cash Flows
for the year ended 31 December 2022
Group Company
Year ended 31 Dec 2022 £'000 Year ended 31 Dec 2021 £'000 Year ended 31 Dec 2022 £'000 Year ended 31 Dec 2021 £'000
Cash flows from operating activities
Loss before taxation (2,971) (2,532) (336) (331)
Depreciation and amortisation 151 46 - -
Share based compensation 127 224 127 224
Finance costs (4) 641 - -
(2,697) (1,621) (209) (107)
Changes in working capital
(Increase)/decrease in trade and other receivables 63 (227) (63) (11)
Increase/(decrease) in trade and other payables 25 (21) 41 1
Cash used in operations 88 (248) (22) (10)
Taxation received 212 84 - -
Net cash used in operating activities (2,397) (1,785) (231) (117)
Cash flows (used in)/generated from investing activities
Acquisition of tangible fixed assets (389) (46) - -
Disposal of tangible fixed assets 10 - - -
Loans to subsidiary - - (2,267) (1,446)
Net cash (used in)/generated from investing activities (379) (46) (2,267) (1,446)
Cash flows from financing activities
Proceeds from issue of shares - 7,500 - 7,500
Issue costs - (437) - (437)
Repayment of lease liabilities - (31) - -
Net cash generated from financing activities - 7,032 - 7,063
Movements in cash and cash equivalents in the period (2,776) 5,201 (2,498) 5,500
Cash and cash equivalents at start of period 6,063 862 5,500 -
Cash and cash equivalents at end of period 3,287 6,063 3,002 5,500
Notes to the Financial Statements
1. General Information
BiVictriX Therapeutics plc ('the Company') is a public limited company
incorporated in England and Wales and was admitted to trading on the AIM
market of the London Stock Exchange under the symbol "BVX" on 11 August 2021.
The address of its registered office is Mereside, Alderley Park, Alderley
Edge, Macclesfield, England, SK10 4TG and the registered company number is
13470690. The principal activity of the Company is research and experimental
development of pharmaceutical products.
2. Significant Accounting Policies and Basis of Preparation
Basis of preparation
The consolidated financial statements have been prepared in accordance with
United Kingdom International Financial Reporting Standards ('IFRS') as adopted
by the UK, IFRIC interpretations and the Companies Act 2006 applicable to
companies operating under IFRS. The Company's financial statements have been
prepared in accordance with Financial Reporting Standard 102 (United Kingdom
Generally Accepted Accounting Practice).
The financial statements are presented in Sterling (£) and rounded to the
nearest £000. This is the predominant functional currency of the Group and is
the currency of the primary economic environment in which it operates. Foreign
transactions are accounted in accordance with the policies set out below.
Basis of consolidation
The financial statements incorporate the financial statements of the Company
and entities controlled by the Company. Control is achieved when the Company
has the power over the investee; is exposed, or has rights, to variable return
from its involvement with the investee; and, has the ability to use its power
to affect its returns. The Company reassesses whether it controls an investee
if facts and circumstances indicate that there are changes to one or more of
the three elements of control listed above.
Consolidation of a subsidiary begins when the Company obtains control over the
subsidiary and ceases when the Company loses control of the subsidiary.
Specifically, the results of subsidiaries acquired or disposed of during the
period are included in the Consolidated Statement of Comprehensive Income from
the date the Company gains control until the date when the Company ceases to
control the subsidiary.
Where necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with the Group's
accounting policies.
All intra-Group assets and liabilities, equity, income, expenses and cash
flows relating to transactions between the members of the Group are eliminated
on consolidation.
Going concern
In considering the Group's financial commitments and forecasts, the Board has
followed the guidelines published by the Financial Reporting Council entitled
''Guidance on Risk Management and Internal Control and Related Financial and
Business Reporting''.
In the normal course of business, the Directors regularly review rolling cash
flow forecasts. The review of financial forecasts and cash flows looking at
least 12 months from the approval of these financial statement includes levers
and controls which could be applied, if necessary.
The Board has considered the impact of rising inflation and foreign exchange
risk. In addition, consideration has been given to the conflict in Ukraine and
the impact that may have on worldwide supplies. These risks are closely
monitored as part of controlled, defined expenditure to meet business
objectives.
Operational cashflows include planned research and development activities to
advance the Group's lead and pipeline programmes. The timing and quantum of
this expenditure is under the control and direction of management with
oversight provided by the Board.
After considering cash flow forecasts and associated risks, the Directors have
a reasonable expectation that the Group has adequate resources to continue in
operational existence for the foreseeable future. Accordingly, the Company
continues to adopt the going concern basis in preparing these financial
statements.
At 31 December 2022, the Group had cash and cash equivalents, including
short-term investments and cash on deposit, of £3.3 million.
Standards, interpretations and amendments to published standards not yet
effective
The Directors have considered those standards and interpretations, which have
not been applied in these financial statements but which are relevant to the
group's operations, that are in issue but not yet effective and do not
consider that they will have a material effect on the future results of the
Group
Currencies
Functional and presentational currency
Foreign currency transactions are translated into the functional currency
using the exchange rates prevailing at the dates of the transactions or at an
average rate for a period if the rates do not fluctuate significantly. Foreign
exchange gains and losses resulting from the settlement of such transactions
and from the translation at year-end exchange rates of monetary assets and
liabilities denominated in foreign currencies are recognised in the
Consolidated Statement of Comprehensive Income. Non-monetary items that are
measured in terms of historical cost in a foreign currency are not
retranslated. The presentational currency is also the functional currency.
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation
and any impairment losses. 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.
Office equipment - 25% straight line
Plant and equipment - 16% straight line
Furniture, fixtures and fittings - 25% straight line
The gain or loss arising on the disposal of an asset is determined as the
difference between the sales proceeds and the carrying amount of the asset and
is recognised in the Consolidated Statement of Comprehensive Income.
At each reporting date, the Group reviews the carrying amounts of its
property, plant and equipment assets to determine whether there is any
indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated in order
to determine the extent of the impairment loss (if any).
Leases
The Group assesses at contract inception whether a contract is, or contains, a
lease. That is, if the contract conveys the right to control the use of an
identified asset for a period of time in exchange for consideration.
The Group applies a single recognition and measurement approach for all
leases, except for short-term leases and leases of low-value assets. The Group
recognises lease liabilities, representing obligations to make lease payments
and right-of-use assets representing the right to use the underlying assets.
Right-of-use assets
The Group recognises right-of-use assets at the commencement date of the
leases (i.e., the date the underlying asset is available for use).
Right-of-use assets are measured at cost, less any accumulated depreciation
and impairment losses, and adjusted for any remeasurement of lease
liabilities. The cost of right-of-use assets includes the amount of lease
liabilities recognised, initial direct costs incurred, and lease payments made
at or before the commencement date less and lease incentives received.
Right-of-use assets are depreciated on a straight-line basis over the
remainder of the lease term.
Lease liabilities
At the commencement date of the lease, the Group recognises lease liabilities
measured at the present value of lease payments to be made over the lease
term. The lease payments include fixed payments (including in-substance fixed
payments) less any lease incentives receivable, variable lease payments that
depend on an index or a rate, and amounts expected to be paid under residual
value guarantees. The lease payments also include the exercise price of a
purchase option reasonably certain to be exercised by the Group and payments
of penalties for terminating the lease, if the lease term reflects the Group
exercising the option to terminate. The Group's lease liabilities are included
in interest-bearing loans and borrowings.
Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to its short-term
leases of machinery and equipment (i.e., those leases that have a lease term
of 12 months or less from the commencement date and do not contain a purchase
option). It also applies the lease of low-value assets recognition exemption
to leases of office equipment that are considered to be low value. Lease
payments on short-term leases and leases of low-value assets are recognised as
an expense on a straight-line bases over the lease term.
Extension and termination options
The Group determines the lease term as the non-cancellable term of the lease,
together with any periods covered by an option to extend the lease if it is
reasonably certain to be exercised, or any periods covered by an option to
terminate the lease, if it is reasonably certain not to be exercised.
The Group applies IAS 36 to determine whether a right-of-use asset is impaired
and accounts for any identified impairment loss.
Research and development
Expenditure on pure and applied research are charged to the profit and loss
account in the year in which they are incurred. Development costs are charged
to profit and loss account unless it can be demonstrated that the costs
represent an intangible asset which meets all of the criteria for
capitalisation set out in para 57 of IAS38.
Income tax
The tax expense or credit represents the sum of the tax currently payable or
recoverable and the movement in deferred tax assets and liabilities.
(a) Current income tax
Current tax, including R&D tax credits which have the characteristics of
income tax, is based on taxable income for the period and any adjustment to
tax from previous periods. Taxable income differs from net income in the
Consolidated Statement of Comprehensive Income because it excludes items of
income or expense that are taxable or deductible in other periods or that are
never taxable or deductible. The calculation uses the latest tax rates for the
period that have been enacted or substantively enacted by the dates of the
Consolidated Statement of Financial Position.
(b) Deferred tax
Deferred tax is calculated at the latest tax rates that have been
substantially enacted by the reporting date that are expected to apply when
settled. It is charged or credited in the Consolidated Statement of
Comprehensive Income, except when it relates to items credited or charged
directly to equity, in which case it is also dealt with in equity.
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
income, and is accounted for using the liability method.
Deferred tax liabilities are generally recognised for all taxable temporary
differences and deferred tax assets are recognised to the extent that it is
probable that taxable income will be available against which the asset can be
utilised. Such assets are reduced to the extent that it is no longer probable
that the asset can be utilised.
Deferred tax assets and liabilities are offset when there is a legal right to
offset current tax assets and liabilities, and when the deferred tax assets
and liabilities relate to taxes levied by the same taxation authority on
either the same taxable entity or different taxable entities where there is an
intention to settle the balances on a net basis.
Deferred tax assets are not recognised due to uncertainty concerning
crystallisation.
Payroll expense and related contributions
Wages, salaries, payroll tax, paid annual leave and sick leave, bonuses, and
non-monetary benefits are accrued in the period in which the associated
services are rendered.
Pension costs
The Group makes contributions to the private pension schemes of Directors and
employees. Contributions are recognised in the periods to which they relate.
Share-based compensation
The Group issues share based payments to certain employees and Directors and
warrants have been issued to certain suppliers. Equity- settled share-based
payments are measured at fair value at the date of grant and expensed on a
straight-line basis over the vesting period, along with a corresponding
increase in equity.
At each reporting date, the Group revises its estimate of the number of equity
instruments expected to vest as a result of the effect of non-market based
vesting conditions. The impact of any revision is recognised in the
Consolidated Statement of Comprehensive Income, with a corresponding
adjustment to equity reserves.
The fair value of share options and warrants are determined using a
Black-Scholes model, taking into consideration the best estimate of the
expected life of the option or warrant and the estimated number of shares that
will eventually vest.
Operating segments
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker. The chief operating
decision-maker is responsible for allocating resources and assessing
performance of operating segments.
The Directors consider that there are no identifiable business segments that
are subject to risks and returns different to the core business. The
information reported to the Directors, for the purposes of resource allocation
and assessment of performance is based wholly on the overall activities of the
Group. The Group has therefore determined that it has only one reportable
segment under IFRS 8.
The results and assets for this segment can be determined by reference to the
Consolidated Statement of Comprehensive Income and Consolidated Statement of
Financial Position.
Investment in subsidiaries
Investment in subsidiaries are shown in the Company balance sheet at cost and
are reviewed annually for impairment.
Financial instruments
Financial assets and financial liabilities are recognised in the Group's
Consolidated Statement of Financial Position when the Group becomes party to
the contractual provisions of the instrument. Financial assets are
derecognised when the contractual rights to the cash flows from the financial
asset expire or when the contractual rights to those assets are transferred.
Financial liabilities are derecognised when the obligation specified in the
contract is discharged, cancelled or expired.
Trade and other receivables
Trade and other receivables that do not contain a significant financing
component are initially recognised at fair value and subsequently held at
amortised cost less provision for impairment. Provisions for impairment are
based on an expected credit loss model as required by IFRS 9.
Cash, cash equivalents and short-term investments
Cash and cash equivalents consist of cash on hand, demand deposits, and other
short-term highly liquid investments that are readily convertible to a known
amount of cash and are subject to an insignificant risk of changes in value.
Trade and other payables
Trade and other payables are not interest-bearing and are stated at nominal
value.
Classification as debt or equity
Debt and equity instruments issued by the Group are classified as either
financial liabilities or as equity in accordance with the substance of the
contractual arrangements and the definitions of a financial liability and an
equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the
assets of an entity after deducting all its liabilities. Equity instruments
issued by the Group are recognised as the proceeds received, net of direct
issue costs.
Capital risk management
The Group has been funded by equity. The components of shareholders' equity
are:
(a) The share capital and share premium account arising on the issue of
shares.
(b) Merger reserve, which was created as a result of the acquisition by the
Company of the entire issued share capital of BiVictriX Limited on 9 August
2021.
(c) The share based compensation reserve results from the Group's grant of
equity-settled share options to selected employees and Directors.
(d) The retained deficit reflecting comprehensive loss to date.
The Group's objective when managing capital is to maintain adequate financial
flexibility to preserve its ability to meet financial obligations, both
current and long term. The capital structure of the Group is managed and
adjusted to reflect changes in economic conditions. The Group funds its
expenditures on commitments from existing cash and cash equivalent balances,
primarily received from issuances of shareholders' equity. There are no
externally imposed capital requirements. Financing decisions are made based on
forecasts of the expected timing and level of capital and operating
expenditure required to meet the Group's commitments and development plans.
Fair value estimation
The carrying value less impairment provision of trade receivables and payables
are assumed to approximate their fair values because of the short term nature
of such assets and the effect of discounting liabilities is negligible.
Significant management judgement in applying accounting policies and
estimation uncertainty
When preparing the financial statements, the Directors make estimates and
assumptions about the recognition and measurement of assets, liabilities,
income and expenses.
Estimation uncertainty
Receivables from the subsidiary, being amounts due from BiVictriX Limited
advanced to support the Group's research expenditure, will be recoverable from
future commercial revenues or capital receipts in the subsidiary, which are
not certain to arise.
Taxation
In recognising income tax assets and liabilities, management makes estimates
of the likely outcome of decisions by tax authorities on transactions and
events whose treatment for tax purposes is uncertain. In particular, amounts
claimed for R&D tax credits may not be receivable. Where the final outcome
of such matters is different, or expected to be different, from previous
assessments made by management, a change to the carrying value of income tax
assets and liabilities will be recorded in the period in which such a
determination is made. The carrying values of current tax are disclosed
separately in the statement of financial position
Share based payment charge
A Black-Scholes model was used to calculate the appropriate charge for share
based payments. The model involves using a number of estimates and judgements
to establish the appropriate inputs including an appropriate interest rate and
dividend rate, exercise restrictions and behavioural considerations. A
significant element of judgement is therefore involved in the calculation of
the charge. The total charge in the year to 31 December 2022 was £127k (year
to 31 December 2021: £224k).
3. Operating Loss
An analysis of the Group's operating loss has been arrived at after charging:
Year ended Year ended
31 Dec 31 Dec
2022 2021
£'000 £'000
Research and development:
Other research and development 1,237 306
Staff costs - Note 5 722 349
Depreciation of property, plant and equipment 151 46
Operating lease cost - land and buildings - 10
General and Administrative:
Staff costs - Note 5 314 329
Administration expenses 424 238
Share based compensation 127 224
Non-recurring costs - 389
Total operating expenses 2,975 1,891
The Group has one reportable segment, namely the development of pharmaceutical
products all within the United Kingdom.
Non-recurring costs represent the costs of the Company's admission to AIM in
the period ended 31 December 2021 which were recognised as an expense.
4. Auditor's Remuneration
The analysis of the auditor's remuneration is as follows:
Year ended Year ended
31 Dec 31 Dec
2022 2021
£'000 £'000
Fees payable to the Group's auditors for the audit of:
the consolidated and Company annual accounts 38 33
the subsidiary's annual accounts -
Total audit fees 38 33
Audit related services 4 4
Total audit related fees 42 37
Other services - -
Total non-audit fees 4 4
5. Employees and Directors
The average monthly number of persons (including Executive Directors) employed
by the Group was:
Group Company
Year ended Year ended Year ended Year ended
31 Dec 31 Dec 31 Dec 31 Dec
2022 2021 2022 2021
Number Number Number Number
Directors 6 5 6 5
Scientists and administration staff 10 5 - -
Average total persons employed 16 10 6 5
At 31 December 2022 the Group had 17 employees (31 December 2021: 7).
Staff costs in respect of these employees were:
Group
Year ended Year ended
31 Dec 31 Dec
2022 2021
£'000 £'000
Salaries and other short-term employee benefits 899 395
Employer's National Insurance 102 44
Pension contributions 35 16
Options vesting under share option schemes 127 224
Total remuneration including vesting of share options 1,163 679
The Group makes contributions to a pension scheme on behalf of the Director
and employees.
The total remuneration of the highest paid Director excluding share based
payments was £212,950 (31 December 2021: £181,290).
The Directors have the authority and responsibility for planning, directing
and controlling, directly or indirectly, the activities of the Group and they
therefore comprise key management personnel as defined by IAS 24.
Aggregate emoluments of the Directors of BiVictrix Therapeutics Plc:
Group
Year ended Year ended
31 Dec 31 Dec
2022 2021
£'000 £'000
Aggregate emoluments of Directors:
Salaries and other short-term employee benefits 375 205
Employer's National Insurance 38 28
Pension contributions 8 7
Options vesting under share option schemes 106 224
Total remuneration including vesting of share options 527 464
6. Taxation
Year ended Year ended
31 Dec 31 Dec
2022 2021
£'000 £'000
Current tax
Current period - UK corporation tax - -
R&D tax credit 454 192
Adjustments in respect of prior periods 20 -
Net tax credit 474 192
The tax credit for each period can be reconciled to the loss per Consolidated
Statement of Comprehensive Income as follows:
Year ended Year ended
31 Dec 31 Dec
2022 2021
£'000 £'000
Loss on ordinary activities before taxation (2,971) (2,532)
Loss before tax at the effective rate of corporation tax in the United Kingdom (566) (481)
of 19% (2021 19%)
Effects of:
Fixed asset differences (15) -
Expenses not deductible for tax purposes 59 -
Additional deduction for R&D expenditure (336) -
Surrender of tax losses for R&D tax credit refund 596 -
Movement in deferred tax not recognised 262 481
R&D tax credit 474 192
Tax credit for the year 474 192
The Group has a deferred tax liability being accelerated capital allowances,
for which the tax, measured at a standard rate of 19% in all periods is 31
December 2022 £262 (2021: £18,000). This has not been recognised as it is
covered by accumulated tax losses in all periods.
The Group has a deferred tax asset for share-based payments, for which the
tax, measured at a standard rate of 19% in all periods is 31 December 2022
£66,000 (2021: £45,000). No deferred tax assets have been recognised due to
the uncertainty of the availability of future profits.
At 31 December 2022 the Group had UK carried forward tax losses of
approximately £3,668,000 (2021: £3,703,000) for which no deferred tax asset
has been recognised.
7. Loss per Share
Basic loss per share is calculated by dividing the loss for the period
attributable to equity holders by the weighted average number of ordinary
shares outstanding during the year.
For diluted loss per share, the loss for the year attributable to equity
holders and the weighted average number of ordinary shares outstanding during
the year is adjusted to assume conversion of all dilutive potential ordinary
shares.
As at 31 December 2022, the Group had 8,734,184 (2021: 8,614,184) share
options, warrants and subscriptions outstanding which are potentially
dilutive.
The calculation of the Group's basic and diluted loss per share is based on
the following data:
Year ended Year ended
31 Dec 31 Dec
2022 2021
£'000 £'000
Loss for the year attributable to equity holders for basic loss and adjusted (2,497) (2,340)
for the effects of dilution
Year ended Year ended
31 Dec 31 Dec
2022 2021
Weighted average number of ordinary shares for basic loss per share 66,115,171 38,865,782
Effects of dilution: - -
Share options
Weighted average number of ordinary shares adjusted for the effects of 66,115,171 38,865,782
dilution
Year ended Year ended
31 Dec 31 Dec
2022 2021
£'000 £'000
Loss per share - basic and diluted (3.78) (6.02)
The loss and the weighted average number of ordinary shares for the years
ended 31 December 2022 and 2021 used for calculating the diluted loss per
share are identical to those for the basic loss per share. This is because the
outstanding share options would have the effect of reducing the loss per
ordinary share and would therefore not be dilutive under the terms of
International Accounting Standard ('IAS') No 33.
8. Property, Plant and Equipment
Office equipment, fixtures and fittings Building improvements Plant and machinery Motor Vehicles Right of Use Asset Total
£'000s £'000s £'000s £'000s £'000s £'000s
Cost
At 31 December 2021 12 3 97 - 275 387
Additions 5 2 229 4 148 388
Disposals - - (7) - - (7)
At 31 December 2022 17 5 319 4 423 768
Accumulated Depreciation
At 31 December 2021 2 1 16 - 29 48
Provided during the year 4 1 43 - 102 150
Disposals - - (1) - - (1)
At 31 December 2022 6 2 58 - 131 197
Net Book Value
At 31 December 2021 10 2 81 - 246 339
At 31 December 2022 11 3 261 4 292 571
Depreciation is charged to operating expenses.
Office equipment, fixtures and fittings Building improvements Plant and machinery Right of Use Asset Total
£'000s £'000s £'000s £'000s £'000s
Cost
At 31 December 2019 2 - - - 2
Additions 1 2 61 - 64
Disposals
At 31 December 2020 3 2 61 66
Additions 9 1 36 275 321
Disposals
At 31 December 2021 12 3 97 275 387
Accumulated Depreciation
At 31 December 2019 1 - - - 1
Provided during the year - - 1 - 1
At 31 December 2020 1 - 1 - 2
Provided during the year 1 1 15 29 46
At 31 December 2021 2 1 16 29 48
Net Book Value
At 31 December 2020 1 2 60 - 63
At 31 December 2021 10 2 81 246 339
9. Investment in Subsidiary Undertakings
The consolidated financial statements of the Group at 31 December 2022
include:
Name of subsidiary Class of share Place of incorporation Principle activities Proportion of ownership interest Proportion of voting rights held
BiVictriX Limited Ordinary United Kingdom Research and development 100% 100%
Group Company
2022 2021 2022 2021
£'000 £'000 £'000 £'000
Cost at 1 January - - 214 -
Acquisitions during the year - - - 214
Cost at 31 December - - 214 214
Carrying Value as at 31 December - - 214 214
Group Company
Break down of carrying value of investment: 2022 2021 2022 2021
£'000 £'000 £'000 £'000
BiVictriX Limited - - 214 214
Investments are tested for impairment at the balance sheet date. The
recoverable amount of the investment in BiVictriX Limited at 31 December 2022
was assessed on the basis of value in use. As this exceeded carrying value no
impairment loss was recognised.
The key assumptions used for the value in use calculation in 2022 were as
follows:
%
Discount rate 13.8
The Directors have made significant estimates on the future revenues based
around a typical partnering with a large FMCG or Pharma partner. Assumptions
have been made based upon on the size of the potential market, a patent will
be achieved from which royalties will flow and the expected royalty % across
the lifetime of the patent.
The Directors have performed a sensitivity analysis to assess the impact of
downside risk of the key assumptions underpinning the projected results of the
Group. The projection used is sensitive to the projected royalty assumptions
that have been applied.
10. Trade and Other Receivables
Group Company
As at As at As at As at
31 Dec 31 Dec 31 Dec 31 Dec
2022 2021 2022 2021
£'000 £'000 £'000 £'000
Amounts receivable within one year
Other taxation and social security 111 68 32 6
Prepayments 113 219 42 5
Trade and other receivables 224 287 74 11
The Directors believe that the carrying value of trade and other receivables
represents their fair value. In determining the recoverability of trade
receivables, the Group considers any change in the credit quality of the
receivable from the date credit was granted up to the reporting date. In
addition, an expected credit losses model is used which broadens the
information that an entity is required to consider when determining its
expectations of impairment. Under this model, expectations from future events
are taken into account which could result in the earlier recognition of
impairments. Details on the Group's credit risk management policies are shown
in Note 16. The Group does not hold any collateral as security for its trade
and other receivables.
Amounts due to the Company from subsidiary undertakings are not considered to
be receivable within one year - see note 17
11. Cash, Cash Equivalents and Short-Term Investments
Group Company
Year ended Year ended Year ended Year ended
31 Dec 31 Dec 31 Dec 31 Dec
2022 2021 2022 2021
£'000 £'000 £'000 £'000
Cash at bank and in hand 3,287 6,063 3,002 5,500
12. Trade and Other Payables
Group Company
Year ended Year ended Year ended Year ended
31 Dec 31 Dec 31 Dec 31 Dec
2022 2021 2022 2021
£'000 £'000 £'000 £'000
Amounts falling due within one year
Trade payables 112 69 - 2
Other taxation and social security 40 65 - -
Accrued expenses 132 174 43 -
Trade and other payables 284 308 43 2
Trade and other payables principally consist of amounts outstanding for trade
purchases and ongoing costs. They are non-interest bearing and are normally
settled on 30 to 45 day terms. The Directors consider that the carrying value
of trade and other payables approximates to their fair value. All trade and
other payables are denominated in Sterling. The Group has financial risk
management policies in place to ensure that all payables are paid within the
credit timeframe and no interest has been charged by any suppliers as a result
of late payment of invoices during the period.
The fair value of trade and other payables approximates to their current book
values.
13. Issued Capital and Reserves
Ordinary shares
Company
Number Share Capital Share Premium Total
Ordinary shares of 1p each:
£'000 £'000 £'000
At 31 December 2021 66,115,171 661 12,052 12,713
At 31 December 2022 66,115,171 661 12,052 12,713
Other reserves
The share premium reserve represents the difference between the net proceeds
of equity issues and the nominal share capital of the shares issued.
The merger reserve at 31 December 2022 arose from the acquisition of BiVictriX
Limited on 9 August 2021, which is accounted for using the merger method of
accounting.
The share-based compensation reserve reflects the cumulative expense for
outstanding share based instruments.
Reserves classified as retained deficit represent accumulated losses. None of
the reserves are distributable.
14. Share-based Payments
Certain Directors and employees of the Group are granted options to subscribe
for shares in the Group in accordance with the rules of the Company's share
option schemes. The number of shares subject to options, the periods in which
they were granted and the period in which they may be exercised are given
below.
The Group operates one share option scheme, in addition share options have
been granted under standalone unapproved share option agreements. Options are
currently granted for £nil consideration and are exercisable at a price
determined on the date of the grant.
At 31 December 2022 the Company had 8,744,184 (2021: 8,614,184) unissued
ordinary shares of 1p under the Company's share option schemes, details of
which are as follows:
Movements on share options during the year were as follows:
Exercise price At Granted Lapsed/ Cancelled At Date from which exercisable Expiry
1 Jan 2022 31 Dec 2022 date
0.250 30,000 - 30,000 3 May 2025 2 May 2032
0.205 40,000 - 40,000 14 Sep 2025 13 Sep 2032
0.170 30,000 - 30,000 22 Dec 2025 21 Dec 2032
0.170 20,000 - 20,000 22 Dec 2025 21 Dec 2032
As at 31 December 2022, the share option scheme movements was as follows:
As at 31 Dec 2022 As at 31 Dec 2021
Number Weighted average exercise price Pence Number Weighted average exercise price Pence
Outstanding at start of the year 8,614,184 20.16 - -
Granted 120,000 20.17 8,614,184 20.16
Lapsed/cancelled - -
Outstanding at end of year 8,734,184 20.16 8,614,184 20.16
Exercisable at end of year 4,900,677 19.54 3,656,170 19.17
The fair values of share options granted during the period were calculated
using the Black Scholes option pricing model. The inputs into the model for
awards granted were as follows:
Options issued 30,000 40,000 30,000 20,000
Grant date 3 May 2022 14 Sep 2022 22 Dec 2022 22 Dec 2022
Expiry date 2 May 2032 13 Sep 2032 21 Dec 2032 21 Dec 2032
Vesting period Over 3 years from grant Over 3 years from grant Over 3 years from grant Over 3 years from grant
Share price (pence) 25.0p 20.5p 17.0p 17.0p
Exercise price (pence) 25.0p 20.5p 17.0p 17.0p
Expected volatility 52.5% 52.5% 52.5% 52.5%
Risk free rate 0.75% 1.75% 3.5% 3.5%
The expected volatility of 52.5% has been estimated based on comparable
companies listed on AIM.
15. Lease liabilities
Amounts recognised in the statement of financial position
Right-of-use assets
Details of the Right-of-use assets held at 31 December 2022 can be found in
note 8.
Lease liabilities
As at As at
31 December 2022 31 December 2021
£'000 £'000
Current 107 71
Non-current 188 175
295 246
Future minimum lease payments are as follows:
Not later than one year 107 71
Later than one year and not later than 5 years 188 175
Total gross payments 295 246
Impact of finance expenses - -
Carrying amount of liability 295 246
Lease liabilities have been recognised on the incremental borrowing rate for
Land and Buildings and Office Equipment.
Amounts recognised in the statement of comprehensive income
As at As at
31 December 2022
31 December 2021
£'000 £'000
Depreciation charge (103) (29)
Interest of lease liabilities (12) (2)
Rental payments with lease term less than 12 months -
(115) (31)
Amounts recognised in the statement of cash flows
As at As at
31 December 2022 31 December 2021
£'000 £'000
Principal elements of lease payments (75) (1)
Interest of lease liabilities - -
Rental payments with lease term less than 12 months - (1)
(75) (2)
16. Financial Risk Management
The main risks arising from the Group's financial instruments are cash flow
and liquidity and credit risk. The Group's financial instruments comprise cash
and various items such as trade payables, which arise directly from its
operations.
Cash flow and liquidity risk
Management monitors the level of cash on a regular basis to ensure that the
Group has sufficient funds to meet its commitments where due. The table below
analyses the Group and Company's financial assets and liabilities by category:
Group Company
Year ended 31 Dec 2022 Financial assets at amortised cost Year ended Year ended 31 Dec 2022 Financial assets at amortised cost Year ended
31 Dec 2021 Financial assets at amortised cost
31 Dec 2021 Financial assets at amortised
£'000
£'000
cost
£'000
£'000
Assets as per statement of financial position
Other receivables 111 68 5,205 2,911
Cash and cash equivalents 3,287 6,063 3,002 5,500
3,398 6,131 8,207 8,411
Group Company
Year ended 31 Dec 2022 Financial assets at amortised cost Year ended 31 Dec 2021 Financial assets at amortised Cost Year ended 31 Dec 2022 Financial assets at amortised cost Year ended 31 Dec 2021 Financial assets at amortised
cost
£'000 £'000 £'000
£'000
Trade payables 112 69 - 1
Other creditors and accruals 172 239 43 -
284 308 43 1
All liabilities are due within 30 days except for lease liabilities which are
dealt with in note 15.
Credit risk
The Group gives careful consideration to which organisations it uses for
banking in order to minimise credit risk. The Group holds cash with two large
banks in the UK. The amounts of cash held at the reporting date can be seen in
the financial assets table above. All of the cash and equivalents were
denominated in UK Sterling. The Group's policy is to minimisethe risks
associated with cash and cash equivalents by placing these deposits with
institutions with a recognised high credit rating.
The carrying amount of financial assets recorded in the Consolidated Statement
of Financial Position, net of any allowances for losses, represents the
Group's maximum exposure to credit risk without taking account of the value of
any collateral obtained.
No allowance has been made for impairment losses. In the Directors' opinion,
there has been no impairment of financial assets during the period.
An allowance for impairment is made where there is an identified credit loss
which, based on previous experience, is evidence of a reduction in the
recoverability of the cash flows. The Directors consider the above measures to
be sufficient to control the credit risk exposure. No collateral is held by
the Group as security in relation to its financial assets.
Foreign currency risk
The Group's exposure to the risk of changes in foreign exchange rates relates
solely to the Group's use of suppliers operating overseas, primarily
denominated in Euros and US Dollars. The Group's use of foreign suppliers is
minimal and as such exposure to foreign currency changes is not material.
The carrying amounts of the Group's foreign currency denominated monetary
assets and monetary liabilities at the year end were £16,000 (2021: 1,000).
At present the Group does not make use of financial instruments to minimise
any foreign exchange gains or losses so any fluctuations in foreign exchange
movements may have a material adverse impact on the results from operating
activities.
Fair value of financial assets and liabilities
There is no material difference between the fair value and the carrying values
of the financial instruments because of the short maturity period of these
financial instruments and their intrinsic size and risk.
Capital risk management
The Group considers capital to be shareholders' equity as shown in the
consolidated statement of financial position, as the Group is primarily funded
by equity finance. The Group is not yet in a position to pay a dividend.
The objectives when managing capital are to safeguard the Group's ability to
continue as a going concern in order to provide returns for shareholders and
for other stakeholders. In order to maintain or adjust the capital structure
the Group may return capital to shareholders and issue new shares.
17. Related Party Transactions
Transactions between the Company and its subsidiaries, which are related
parties, have been eliminated on consolidation and are not disclosed in this
note.
Key management compensation is disclosed in Note 5 of the consolidated
financial statements. Directors' emoluments are disclosed in the Remuneration
Committee Report.
18. Transactions with shareholders
The following transactions with shareholders and companies controlled by
directors or former directors of Bivictrix were recorded, excluding VAT,
during the year:
Year to 31 December 2022 Year to 31 December 2021
£'000 £'000
Acceleris (David Youngman/Norman Molyneux) - 129
Non-Executive Director fees, funding support fees and expenses
Gladstone Consultancy Partnership (Iain Ross) - 39
Consultancy fees
Company
The Company is responsible for financing and setting Group strategy. The
Company's subsidiary carried out the Group's research and development strategy
including the management of the Group's intellectual property. The Company
provides funding to its subsidiary in the form of a loan. This loan is
classified as non-current to reflect the likely repayment schedule of the
loan. Interest is accrued at a rate of 4.5% per annum which is considered to
be a market rate. Balance outstanding, including accrued interest, at the 31
December 2022 was £5,173,000 (31 December 2021: 2,906,000)
19. Contingent Liabilities
The Group has no contingent liabilities at 31 December 2022 (2021: nil).
20. Convertible loan notes
In 2020 BiVictriX Limited entered into a Convertible Loan Agreement ('CLA')
with the Future Fund, Development Bank of Wales and Alderley Park Ventures.
The CLA had 36 months term with interest payable of 8% p.a Loan note
holders had the right to receive repayment in full and a 100% redemption
premium or convert to equity at 20% to the prevailing share price or the
previous round price, whichever was the lower..
On 10 August 2021, the loan note holders elected to convert the CLA and
accrued interest. All loan notes were converted to ordinary shares at a price
of 11.7 pence per share. The discount against the Admission price of 20.0
pence per share has been recognised in the statement of comprehensive income.
21. Events after the Reporting Date
In January 2023, Dr. Michael Kauffman was appointed as Non-Executive Chairman.
In January 2023, positive preclinical data was reported with the BVX001
programme, demonstrating a highly favourable safety profile compared to
Mylotarg(TM) in an in vivo model assessing the risk for bone marrow toxicity
and neutropenia.
22. Ultimate Controlling Party
There is no ultimate controlling party of the Group.
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