REG - e-Therapeutics plc - Interim results for the six months to 31 July 2023
26/10/2023 07:45
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20231026:nRSZ3275Ra&default-theme=true
RNS Number : 3275R e-Therapeutics plc 26 October 2023
e-therapeutics plc
("e-therapeutics" or "ETX" or the "Company")
Interim results for the six months to 31 July 2023
Six months of progress with positive proof-of-concept data generated with lead
GalOmic™ RNAi assets in cardiometabolic disease and haemophilia
Continued integration of generative artificial intelligence into HepNet™
London, UK, 26 October 2023 - e-therapeutics plc (AIM: ETX; OTCQX; ETXPF), a
company integrating computational power and biological data to discover
life-transforming RNAi medicines, announces its unaudited interim results for
the six months to 31 July 2023.
Operational Highlights
á Continued growth and rapid advancement of GalOmic™ RNAi
therapeutics against target genes discovered using our HepNet™ computational
platform, including preclinical programs in cardiometabolic and metabolic
disease, haemophilia, and two further undisclosed programs.
á Generated positive proof-of-concept data for ETX-291 in
cardiometabolic disease and ETX-148 in haemophilia, demonstrating
disease-modifying potential of HepNet™ identified targets.
á Increased pool of novel targets identified and assessed in silico
by HepNet™, ensuring a continual supply of in-house preclinical programs and
a variety of partnering opportunities spanning a broad range of therapeutic
areas.
á Continued validation of HepNet™, including our
hepatocyte-specific knowledge graph, proprietary target identification
approaches, and siRNA (short interfering RNA) construct design capabilities.
á Advanced projects developing and implementing generative
artificial intelligence ("AI") including large language models ("LLMs") across
ETX processes and systems, further enhancing computational capabilities, and
transforming HepNet™ into a dynamic knowledge resource.
á Continued expansion of AI approaches, enabling the transformation
of siRNA construct design and selection to reduce timelines and associated
costs dramatically.
á Sustained intellectual property ("IP") activity continued, with
priority forming patent applications filed on three new inventions, and
consolidated international filing programs for eight inventions, all arising
from the Company's proprietary GalNAc-siRNA technology, GalOmic™.
á Strong progress made in immuno-oncology collaboration with iTeos
Therapeutics, Inc. ("iTeos"), with continued delivery against pre-agreed
milestones.
Post Period Highlights
á Effective 20 September 2023, Timothy Bretherton assumed the role of Chief Financial Officer (non-board). Michael Bretherton stepped down from his role as interim CFO and will now focus on his role as a Non-Executive Director of the Company.
Financial Highlights
á Revenue of £0.2 million (H1 2022: £0.3 million)
á R&D spend of £5.3 million (H1 2022: £3.1 million)
á Operating loss for the period of £7.0 million (H1 2022 loss:
£4.6 million)
á Loss after tax for the period of £5.6 million (H1 2022 loss:
£3.8 million)
á Cash and cash equivalents as at 31 July 2023 of £24.8 million
(31 January 2023: £31.7 million)
á R&D tax credit receivable as at 31 July 2023 of £2.5 million
(31 January 2023: £1.5 million)
á Headcount (excluding Non-Executive Directors) as at 31 July 2023
of 34 (31 January 2023: 38)
Ali Mortazavi, Chief Executive Officer of e-therapeutics, commented:
"Despite a severe macroeconomic climate, we have made significant progress
during the past six months. It is a tribute to our team that we have been able
to translate our computational analyses into tangible assets, generating
compelling preclinical data at a fraction of the R&D spend of any
competitor. We look forward to showcasing additional data from our preclinical
pipeline in the near future.
"It has only been six months since we began incorporating generative AI into
our processes and projects, but the significant impact of these technologies
throughout ETX is already apparent. Through this work, we continue to address
directly the long, expensive, and risky product lifecycle of drug discovery,
solidifying ourselves as one of the leading companies in the emerging TechBio
sector. A year ago, generative AI technologies did not exist. Now, we are
integrating them into every aspect of our drug development process, allowing
us to develop our life-transforming RNAi medicines at pace. As we continue to
leverage the most cutting-edge computation, I look forward to the future with
confidence."
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ('MAR') which has been incorporated into UK law by the
European Union (Withdrawal) Act 2018. Upon the publication of this
announcement via Regulatory Information Service ('RIS'), this inside
information is now considered to be in the public domain.
e-therapeutics plc
Ali Mortazavi, Tel: +44 (0)1993 883 125
CEO
www.etherapeutics.co.uk
Timothy Bretherton, CFO
SP Angel Corporate Finance LLP Tel: +44(0)20 3470 0470
Nominated Adviser and Broker
Matthew Johnson/Harry Davies-Ball (Corporate Finance)
Vadim Alexandre/Rob Rees (Corporate Broking)
About e-therapeutics plc
e-therapeutics plc ("ETX") integrates computational power and biology
information to discover life-transforming RNAi medicines. The Company's
technology uses computation to capture and model human biology, identify novel
targets, and develop RNAi medicines against those targets that can be rapidly
progressed to the clinic.
ETX's proprietary HepNet™ platform enables the generation and analysis of
biological network models, providing a novel and mechanistic approach to drug
discovery. This approach explicitly considers the true complexity of biology
to make more reliable predictions from large complex data sets and ETX's
proprietary hepatocyte knowledgebase - the world's most comprehensive and
integrated hepatocyte-centric data resource. The Company generates,
prioritises, and tests millions of hypotheses in silico to identify better
therapeutic targets with higher confidence.
GalOmic™, ETX's proprietary RNAi platform, enables targeted delivery to
hepatocytes in the liver and the specific silencing of novel
disease-associated genes, identified by HepNet™. The focus on hepatocytes
offers the opportunity to tackle a wide variety of diseases. The liver is a
highly metabolically active organ which performs a key role in many biological
processes and vital functions crucial for human health. ETX's GalOmic™
constructs have demonstrated compelling in vivo performance in terms of depth
of gene silencing and duration of action.
The Company is progressing a pipeline of first-in-class RNAi candidates across
a variety of therapeutic areas with high unmet need, including preclinical
programs in cardiometabolic and metabolic diseases, haemophilia, and other
undisclosed indications. ETX has also partnered with biopharma companies such
as Novo Nordisk, Galapagos NV and iTeos Therapeutics using its computational
network biology approach across a diverse range of drug discovery projects.
The Company is based in London, UK and listed on the Alternative Investment
Market of the London Stock Exchange ("AIM"), with ticker symbol ETX.
e-therapeutics is also traded on the OTCQX Best Market (OTCQX) in the United
States, under ticker symbol ETXPF.
Chief Executive's Statement
During the past six months, we have concluded the successful transition into a
proven RNAi biotech company. Our lead assets in cardiometabolic disease and
haemophilia have progressed to preclinical proof-of-concept experiments,
validating our HepNet™ computational platform, our GalOmic™ chemistry
platform, and delivering proof in support of our goal of Computing the Future
of Medicine™.
While we continue to build our in-house pipeline of assets, we are progressing
HepNet™ into the central nexus within e-therapeutics. By leveraging
generative artificial intelligence ("AI") and large language model ("LLM")
advances, we have built on the validated technology and data resources in
HepNetª and are beginning to unlock next-level predictive power in a truly
seamless system. This transformation will continue to deliver novel
therapeutics at an unprecedented scale, increasing the pace of target
identification and dramatically reducing the time and cost of developing
life-transforming medicines.
GalOmic™ RNAi Platform and Continued Execution of Therapeutic Pipeline
We continue to progress our therapeutic pipeline, with five assets currently
in preclinical studies across a range of therapeutic areas, including
cardiometabolic disease and haemophilia. During the past six months, we have
generated positive proof-of-concept data for ETX-291 in cardiometabolic
disease and ETX-148 in haemophilia, underscoring the robustness of the
GalOmic™ platform and validating HepNet™'s ability to identify novel genes
with therapeutic potential. These proof-of-concept data are underpinned by the
silencing profile of our siRNA platform. GalOmic™ constructs have
demonstrated potent and durable knockdown of target mRNA expression of
therapeutically relevant targets in vivo, supporting infrequent dosing.
ETX-291 for the Treatment of Cardiometabolic Disease
Cardiometabolic diseases are a leading cause of death and encompass multiple
conditions including obesity, cardiovascular disease, and Type 2 diabetes.
ETX-291 targets a gene with human genetic evidence of disease-modifying
benefit. In preclinical studies in a representative disease model, ETX-291
impacts multiple cardiometabolic disease drivers resulting in a pleiotropic
benefit and highlighting its potential to treat a broad range of
cardiometabolic indications.
ETX-148 for the Treatment of Haemophilia
ETX-148 is our preclinical pan-haemophilia asset. We have generated data that
suggests it is safe, effective, and able to address a key remaining unmet need
in haemophilia: protection from joint bleeds. Histological data from a
preclinical joint bleed model suggests ETX-148 can protect against
bleed-induced joint damage. Importantly, this protection is achieved without
an increased risk of thrombosis, which has been characterised in a variety of
safety experiments.
ETX-291 and ETX-148 are due to complete preclinical proof-of-concept studies
by the end of the year and we are looking forward to presenting further
details of our preclinical data packages in the near future. Additionally, we
continue to add to our pool of novel targets, ensuring our early pipeline is
populated and generating additional partnering opportunities.
Non-dilutive funding opportunities via collaborations and partnerships remain
a key component of the Company's strategy. Successfully demonstrating
preclinical proof-of-concept for our first RNAi assets is fuelling partnering
and out-licensing conversations both for individual assets and platform
access, striking a balance between preclinical assets to partner and assets
that we will progress to early clinical trials to reach a more significant
value inflection point.
HepNetª and Integration of Large Language Models
We continue to strengthen, innovate, and validate HepNet™, the most
comprehensive hepatocyte data and analytics resource in the world. This has
included the generation of positive proof-of-concept data for our in-house
GalOmic™ pipeline programs, validating HepNet™'s ability to reliably
identify novel gene targets and design potent siRNA constructs. Furthermore,
we have continued to expand our knowledgebase, initiating partnerships that
will provide access to proprietary data assets that will support
disease-related process and target discovery.
We are fully embracing generative AI and LLMs by creating specialised LLM
"agents" and transforming HepNet™ into a dynamic knowledge resource. Over
the past six months, this ambitious agenda has driven design and development
of infrastructure and model development and refinement. Over the coming months
it will deliver a unifying framework driving every aspect of our pipeline,
solidifying e-therapeutics' position as a global leader in AI-driven drug
development.
Our projects include our "Straight to In Vivo" efforts, which will allow us to
bypass in vitro screening and move straight to in vivo models. This will
dramatically reduce timelines and costs associated with identifying optimal
siRNA constructs to silence any hepatocyte-expressed target gene. We
ultimately aim to create a robust pipeline and business model leveraging the
full potential of Generative AI and LLM to continue breaking new ground in
drug discovery, creating novel therapeutics, and improving patient outcomes.
Intellectual Property
The Company continues to execute its very active IP strategy that is
indicative of both the high volume of novel innovations being generated and
the critical importance ETX attributes to protecting its inventions. The
patent applications filed over the period 31 January 2023 to 31 July 2023
cover eleven inventions arising from the Company's innovation around novel
target ideas, novel siRNA therapeutics, and novel siRNA chemistries.
Partnerships and Collaborations
We continue to deliver on our collaboration with iTeos Therapeutics,
leveraging our unique computational methodology to enable the discovery of
highly differentiated novel immuno-oncology therapeutics. The work is
progressing well against pre-defined plans and milestones, successfully
passing decision gates. As well as receiving near-term cash payments material
to the revenue of the Company, we are eligible to receive undisclosed
milestone payments through preclinical and clinical development, in addition
to regulatory milestones, per programme.
Organisation
ETX continues to invest in and attract leading industry talent, adding to an
existing world class multi-disciplinary team of experts in computational
biology and RNAi therapeutics. This is exemplified by our recent hires in the
USA, driven by our desire to hire the best talent and resulting in a lean
presence on the East Coast, a major biotech hub.
The team has worked hard to deliver the progress highlighted in this statement
and I should like to thank them for their continued commitment and dedication
in helping ETX to deliver on its strategy and key objectives.
At a Board level, there is an open position for an additional independent NED
to broaden the Board experience further and adhere to best practice corporate
governance guidelines.
Post Period
On 20 September 2023, ETX announced that Michael Bretherton had stepped down
from his role as interim CFO and will now focus on his role as a Non-Executive
Director of the Company. Timothy Bretherton, Director of Finance and
Operations, assumed the CFO role (non-board) with immediate effect.
Outlook
Despite a severe macroeconomic climate, we have made significant progress
during the past six months. It is a tribute to our team that we have been able
to translate our computational analyses into tangible assets, generating
compelling preclinical data at a fraction of the R&D spend of any
competitor. We look forward to showcasing additional data from our preclinical
pipeline in the near future.
It has only been six months since we began incorporating generative AI into
our processes and projects, but the significant impact of these technologies
throughout ETX is already apparent. Through this work, we continue to address
directly the long, expensive, and risky product lifecycle of drug discovery,
solidifying ourselves as one of the leading companies in the emerging TechBio
sector. A year ago, generative AI technologies did not exist. Now, we are
integrating them into every aspect of our drug development process, allowing
us to develop our life-transforming RNAi medicines at pace. As we continue to
leverage the most cutting-edge computation, I look forward to the future with
confidence.
Ali Mortazavi
Chief Executive Officer
Financial Review
Period end cash of £24.8m and operating loss of £7.0m in H1, FY2024.
The Company continues to manage the underlying cash burn carefully whilst
focusing on the development of ETX engineered large language models ("LLMs")
to enhance and expand our computational capabilities leading to development of
multiple preclinical assets across a variety of therapeutic areas with unmet
medical needs.
Revenue
The Company reached another milestone with iTeos in May this year, resulting
in the recognition of £0.2 million of revenue (H1 2022: £0.3 million
including remaining Galapagos milestone). This collaboration is focusing on
the discovery of novel therapeutic approaches and targets in immuno-oncology.
The last phase of this project is underway and is expected to be completed
during Q1 of FY2025.
Research and Development
R&D expenditure in H1 2023 increased to £5.3 million (H1 2022: £3.1
million). This mainly reflects an increase in outsourced CRO costs to progress
the execution of preclinical targets, together with additional cost in
relation to our computational and RNAi platforms and associated patent
applications. Through increased expenditure, we have made compelling
advancements in our goal of Computing the Future of Medicine™.
During H2, we are expecting a further increase in R&D costs as we continue
to focus on the development of our LLMs, alongside progressing the execution
of preclinical targets and growing our in-house pipelines across a variety of
therapeutic areas.
General and Administrative Expenses
General and administrative expenses have remained broadly in-line with the
prior half year and amounted to £1.8 million (H1 2022: £1.7 million). We
continue to monitor and control these costs closely to ensure maximum cash
availability for R&D expenditure to help us accomplish our mission to
discover life-transforming RNAi medicines.
R&D tax credits and loss for the half year
The income statement includes an R&D tax credit of £1.0 million (H1 2022:
£0.7 million) in relation to the current year, bringing down the loss after
tax for the half year to £5.6 million (H1 2022: £3.8 million). The increase
in tax credit from the prior half year reflects the increase in qualifying
R&D spend in the period.
Cash flow
Cash as at 31 July 2023 stood at £24.8 million, which is £6.8 million lower
than the start of the year. The reduction reflects an operating cash outflow
of £6.6 million, net of non-cash share-based employee option charges,
depreciation and amortisation, coupled with working capital outflows of £0.2
million, property lease liability payments of £0.2 million and purchase
additions of £0.1 million to fixed and intangible assets, partially offset by
interest income receipts of £0.3 million. Cash balances are expected to
benefit by a cash receipt of £1.5 million in the last quarter of the current
financial year in respect of the R&D tax credit relating to FY2023.
Financial Outlook
Our current expectations for the underlying cash burn in the second half of
the financial year will be higher than that incurred in H1 2023. This is due
to our planned increase in R&D spend to continue the expansion of our AI
capabilities and progress the identification and execution of preclinical
targets, together with sustaining our active IP strategy as novel inventions
are generated.
INCOME STATEMENT FOR THE PERIOD ENDED 31 JULY 2023
6 months
6 months ended ended 31 July 2022 Year ended 31 January 2023
31 July 2023
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Revenue 160 295 475
Cost of sales - - -
Gross profit 160 295 475
Research and development expenditure (5,324) (3,123) (7,224)
Administrative expenses (1,806) (1,727) (3,490)
Operating loss (6,970) (4,555) (10,239)
Interest income 343 46 490
Interest expense (4) (12) (23)
Loss before tax (6,631) (4,521) (9,772)
Taxation 1,037 709 1,498
Loss for the period/year attributable to equity holders of the Company
(5,594) (3,812) (8,274)
Loss per share: basic and diluted (0.97)p (0.74)p (1.54)p
STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 31 JULY 2023
Year ended 31 January
6 months ended 6 months ended 2023
31 July 2023 31 July 2022
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Loss for the period (5,594) (3,812) (8,274)
Other comprehensive income - - -
Total comprehensive income for the period/year attributable to equity
holders of the Company
(5,594) (3,812) (8,274)
STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 31 JULY 2023
Share capital Share premium Retained earnings
Total
£'000 £'000 £'000 £'000
As at 1 February 2022 515 99,243 (72,032) 27,726
Total comprehensive income for the period
Loss for the period - - (3,812) (3,812)
Total comprehensive income for the period - - (3,812) (3,812)
Transactions with owners, recorded directly in equity
Issue of ordinary shares - 8 - 8
Equity-settled share-based payment transactions
- - 196 196
Total contributions by and distribution to owners - 8 196 204
As at 31 July 2022 515 99,251 (75,648) 24,118
Total comprehensive income for the period
Loss for the period - - (4,462) (4,462)
Total comprehensive income for the period (4,462) (4,462)
Transactions with owners, recorded directly in equity
Issue of ordinary shares 67 13,362 - 13,429
Equity-settled share-based payment transactions - - (41) (41)
Total contributions by and distribution to owners 67 13,362 (41) 13,388
As at 31 January 2023 582 112,613 (80,151) 33,044
Total comprehensive income for the period
Loss for the period - - (5,594) (5,594)
Total comprehensive income for the period - - (5,594) (5,594)
Transactions with owners, recorded directly in equity
Issue of ordinary shares 1 21 - 22
Equity-settled share-based payment
transactions - - 59 59
Total contributions by and distribution to owners 1 21 59 81
As at 31 July 2023 583 112,634 (85,686) 27,531
STATEMENT OF FINANCIAL POSITION AS AT 31 JULY 2023
31 July 31 July 31 January
2023 2022 2023
Note (unaudited) (unaudited) (audited)
£'000 £'000 £'000
Non-current assets
Intangible assets 301 182 239
Property, plant and equipment 175 617 400
476 799 639
Current assets
Tax receivable 2,537 2,184 1,500
Trade and other receivables 302 192 259
Prepayments 647 563 553
Cash and cash equivalents 24,845 21,561 31,689
28,331 24,500 34,001
Total assets 28,807 25,299 34,640
Current liabilities
Trade and other payables 1,186 687 1,301
Lease Liability 90 405 295
Contract liabilities - - -
1,276 1,092 1,596
Non-current liabilities
Lease Liability - 89 -
Total liabilities 1,276 1,181 1,596
Net assets 27,531 24,118 33,044
Equity
Share capital 2 583 515 582
Share premium 112,634 99,251 112,613
Retained earnings (85,686) (75,648) (80,151)
Total equity attributable to equity
holders of the Company 27,531 24,118 33,044
CASH FLOW STATEMENT FOR THE PERIOD ENDED 31 JULY
2023
6 months ended 6 months ended Year ended 31 January
31 July 31 July 2023
2023 2022
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Loss for the period/year (5,594) (3,812) (8,274)
Adjustments for:
Depreciation, amortisation and impairment 271 242 468
Loss on disposal of fixed assets - - 10
Interest income (343) (46) (490)
Interest expense 4 12 23
Equity-settled share-based payment expenses 59 196 155
Taxation (1,037) (709) (1,522)
Operating cash flows before movements in working capital
(6,640) (4,117) (9,630)
(Increase)/Decrease in trade and other receivables
(137) (19) (75)
Increase/(Decrease) in trade and other payables
(110) (608) 198
Tax received - - 1,496
Net cash from operating activities (6,887) (4,744) (8,011)
Interest received 343 46 490
Interest paid (4) (12) (23)
Acquisition of property, plant and equipment (5) (51) (68)
Acquisition of other intangible assets (103) (83) (142)
Movement in short term investments - 15,051 15,051
Net cash from investing activities 231 14,951 15,308
Net proceeds from issue of share capital 22 8 13,437
Payments under lease liabilities - - -
Repayment of lease liability (210) - (391)
Net cash from financing activities (188) 8 13,046
Net decrease in cash and cash equivalents (6,844) 10,215 20,343
Cash and cash equivalents at the beginning of the period/year
31,689 11,346 11,346
Cash and cash equivalents at the end of the period/year
24,845 21,561 31,689
Notes
1. Basis of Preparation
These unaudited interim financial statements do not comprise statutory
accounts as defined within section 434 of the Companies Act 2006. The
Company is a public limited company; it is listed on the London Stock
Exchange's AIM market and is incorporated and domiciled in the United
Kingdom. The address of its registered office is 4 Kingdom Street,
Paddington, London, W2 6BD, UK.
Statutory accounts for the year ended 31 January 2023 were approved by the
Board of Directors on 4 May 2023 and delivered to the Registrar of
Companies. The report of the Auditor on the accounts was unqualified, did
not contain an emphasis of matter paragraph and did not contain any statement
under section 498 of the Companies Act 2006.
While this interim statement, which is neither audited nor reviewed, has been
prepared in accordance with the recognition and measurement criteria of
international accounting standards in conformity with the requirements of the
Companies Act 2006 this announcement does not in itself contain sufficient
information to comply with IFRS. It does not include all the information
required for the full annual financial statements and should be read in
conjunction with the financial statements as at, and for the year ended, 31
January 2023. It does not comply with International Accounting Standard
("IAS") 34 'Interim Financial Reporting' as is permissible under the rules of
AIM.
The accounting policies applied in preparing these interim financial
statements are the same as those applied in the preparation of the annual
financial statements for the year ended 31 January 2023 (as defined therein)
other than standards, amendments and interpretations which became effective
after
1 February 2023.
New standards, amendments and interpretations not adopted in the current
financial year have not been disclosed as they are not expected to have a
material impact on the Company's financial statements.
2. Share Capital
31 July 2023 31 July 2022 31 January 2023
(unaudited) (unaudited) (audited)
In issue - fully paid
Ordinary shares of £0.001 each (number) 582,694,162 514,614,982 582,159,332
Allotted, called up and fully paid
Ordinary shares of £0.001 each (£'000) 583 515 582
During the six-month period to 31 July 2023, 500,000 new ordinary shares of
0.1p each were issued following the exercise of share options at a price of
2.8p per share by a former employee and 34,830 new ordinary shares of 0.1p
each were issued at a price of 21.71p each in lieu of fees payable to a
non-executive director in accordance with his service agreement.
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 IR PPGRUUUPWPWARecent news on E-Therapeutics
See all newsREG - e-Therapeutics plc - Result of General Meeting
AnnouncementREG - e-Therapeutics plc - Proposed Fundraise of £28.9m and Cancellation
AnnouncementREG - e-Therapeutics plc - Total Voting Rights
AnnouncementREG - AIM - AIM Notice - 31/01/2024
AnnouncementREG - e-Therapeutics plc - Exercise of Options and Issue of Equity
Announcement