REG - Oxford Cannabinoid - Half-year Report
23/01/2023 07:00
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RNS Number : 4600N Oxford Cannabinoid Tech.Holdings 23 January 2023
Oxford Cannabinoid Technologies Holdings plc
("OCTP" or the "Company")
Interim results for the six months ended 31 October 2022
Oxford Cannabinoid Technologies Holdings plc, the pharmaceutical company
developing prescription cannabinoid medicines for approval by global
regulatory agencies and targeting the US$ multi-billion pain market, is
pleased to announce its interim results for the six months ended 31 October
2022 (the "Period").
Operational Highlights
· Pre-clinical activities for the Company's lead programme, OCT461201
(programme 1), remained on track and on budget
o Phase I clinical trial is due to commence in Q1 2023 with interim results
anticipated in Q2 2023
o Master service agreement and work order signed with Simbec Research
Limited in preparation for the commencement of the Phase I clinical trial
· The Company remains on target to be at pre-clinical stage (programme
3) and lead stage (programme 4) in Q2 2023 as well as Phase I ready for
programme 2 in Q1 2023, at which time further development for these programmes
will be placed on hold
· Inaugural meeting of Scientific Advisory Board
Financial Highlights
· Robust balance sheet, debt-free with cash reserves of approximately
£5m at Period-end (30 April 2022: £9.2m) which are expected to be fully
utilised during Q1 2024
· Approximately £3.1m of R&D costs were incurred, primarily on the
Company's lead drug candidate OCT461201, which accounted for approximately
£1.5m of the total, with progress being made on all four programmes
· Administrative costs of £1.34m include salary and associated costs
of £662k and a share based (non-cash) payment charge of £61k in advance of
the Phase I clinical trial for programme 1
· R&D tax credit in the first half of £840k (30 April 2022:
£760k), with tax losses surrendered for the R&D tax credit payment
Post Period Highlights
· Completion of the pre-clinical work for OCT461201 under the Group's
£2.6m contract research agreement with Aptuit (Verona) SRL, a subsidiary of
Evotec SE
· Appointment of Clarissa Sowemimo-Coker, previously Chief Operating
Officer, as interim CEO
· Submission of combined clinical trial application ("CTA") for review
by the Wales Research Ethics Committee (REC) and the UK Medicines and
Healthcare products Regulatory Agency
Interim CEO, Clarissa Sowemimo-Coker, commented: "This was a busy and pivotal
period for the Company and we are delighted with the progress. The groundwork
has been laid for an exciting 2023, with our focus firmly on the commencement
of the Phase I clinical trial for programme 1. We have worked hard as a team
to get to this point which represents a hugely significant milestone for the
Company and our shareholders."
Analyst Briefing, 09.30, Today 23 January 2023
A briefing for analysts will be held at 09.30 today. Analysts interested in
attending should contact Walbrook PR by emailing oxcantech@walbrookpr.com
(mailto:oxcantech@walbrookpr.com) or by calling 020 7933 8780.
Investor Presentation, 16.30, Today 23 January 2023
A live online presentation via the Investor Meet Company platform will also be
held at 16.30 GMT today, which is open to all existing and potential
shareholders.
Investors can sign up to Investor Meet Company for free and add to meet Oxford
Cannabinoid Technologies Holdings plc via:
https://www.investormeetcompany.com/oxford-cannabinoid-technologies-holdings-plc/register-investor
(https://www.investormeetcompany.com/oxford-cannabinoid-technologies-holdings-plc/register-investor)
Investors who already follow OCTP on the Investor Meet Company platform will
automatically receive an invitation to the event.
The unaudited interim report for the 6 months ended 31 October 2022 is
available on the Company's website at: www.oxcantech.com
(https://urldefense.proofpoint.com/v2/url?u=http-3A__www.oxcantech.com_&d=DwMGaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&r=7Um2a7LLyUH5SxHgl6zdagatUzGQxXwYgU_CeVAgL9Q&m=kR_Hjjn07Jsd47IiTGeyUKC3Q2HOmc2k-HnXXjfJDbg&s=GFxut1xAl8isFgEqBSPyHxyd4L-9l0Z2IYjrRdaKm1E&e=)
and in hard copy form at the Company's registered office at Prama House,
267 Banbury Road, Oxford, OX2 7HT.
It is also available for inspection at:
www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism
(https://urldefense.proofpoint.com/v2/url?u=http-3A__www.fca.org.uk_markets_primary-2Dmarkets_regulatory-2Ddisclosures_national-2Dstorage-2Dmechanism&d=DwMGaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&r=7Um2a7LLyUH5SxHgl6zdagatUzGQxXwYgU_CeVAgL9Q&m=kR_Hjjn07Jsd47IiTGeyUKC3Q2HOmc2k-HnXXjfJDbg&s=z7lAUYO9aq6HBtuB_Hq8I10m4igZv3uixdkqQJaliao&e=)
.
Prior to publication, the information contained within this announcement was
deemed by the Company to constitute inside information for the purposes of
Article 7 of EU Regulation 596/2014 (which forms part of domestic UK law
pursuant to the European Union (Withdrawal) Act 2018). With the publication of
this announcement, this information is now considered to be in the public
domain.
The Directors of the Company accept responsibility for the content of this
announcement.
Enquiries:
Oxford Cannabinoid Technologies Holdings plc +44 (0)20 3034 2820
Clarissa Sowemimo-Coker (Interim CEO) clarissa@oxcantech.com
Cairn Financial Advisers LLP
Emily Staples +44 (0)20 7213 0897
Jo Turner +44 (0) 20 7213 0885
Axis Capital Markets Limited
Kamran Hussain +44 (0)20 3026 0320
Richard Hutchison
finnCap Ltd
Geoff Nash/Fergus Sullivan +44 (0) 20 7220 0500
Nigel Birks (ECM)
Walbrook PR Limited +44 (0)20 7933 8780
Paul Vann/Nick Rome +44 (0)7768 807631
oxcantech@walbrookpr.com (mailto:oxcantech@walbrookpr.com)
About Oxford Cannabinoid Technologies Holdings Plc:
Oxford Cannabinoid Technologies Holdings plc ("OCTP") is the holding company
of a pharmaceutical Group developing prescription cannabinoid medicines
targeting the US$ multi-billion global pain market.
OCTP currently has a portfolio of four drug development programmes. Its lead
compound, OCT461201, will initially target neuropathic and visceral pain
(including irritable bowel syndrome ("IBS") and chemotherapy induced
peripheral neuropathy ("CIPN")), with Phase 1 clinical trials, aimed at
demonstrating safety and tolerability, due to commence in the near term.
Interim trial results are expected in Q2 2023.
(https://www.londonstockexchange.com/news-article/OCTP/updates-on-lead-programme-1-and-programme-2/15391762)
The global market for CIPN alone was valued at US$1.61bn in 2020 and is
forecast to reach US$2.37bn by the year 2027.
OCTP's drug development pipeline, comprises both natural and synthetic
compounds, and includes compounds targeting trigeminal neuralgia, a severe
type of face pain, and cannabinoid derivatives targeting pain and potentially
other therapeutic areas. Having established an exclusive license agreement
with Canopy Growth Corporation for their entire pharmaceutical cannabinoid
derivative library, OCTP now has a portfolio of over 400 derivatives and
intellectual property rights including 14 patent families and associated
research data.
OCTP has a clearly defined path to commercialisation, revenues and growth. The
Group is developing drug candidates through clinical trials to gain regulatory
approval (FDA/MHRA/EMA) that will enable medical professionals to prescribe
them with confidence. OCTP's portfolio aims to balance risk, value and time to
market, whilst ensuring market exclusivity around all its key activities.
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed to be, forward
looking statements. Forward looking statements are identified by their use of
terms and phrases such as ''believe'', ''could'', "should" ''envisage'',
''estimate'', ''intend'', ''may'', ''plan'', ''potentially'', "expect",
''will'' or the negative of those, variations or comparable expressions,
including references to assumptions. These forward-looking statements are not
based on historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of operations,
performance, future capital and other expenditures (including the amount,
nature and sources of funding thereof), competitive advantages, business
prospects and opportunities. Such forward looking statements reflect the
Directors' current beliefs and assumptions and are based on information
currently available to the Directors.
CEO's Interim Management Statement
Oxford Cannabinoid Technologies Holdings plc ("OCTP" or the "Company") is the
holding company of a pharmaceutical group developing prescription cannabinoid
medicines for approval by global regulatory agencies and targeting the US$
multi-billion pain market. The group is comprised of OCTP and its wholly owned
subsidiary Oxford Cannabinoid Technologies Ltd ("OCT") ("Group").
This unaudited interim report for the six-month period ended 31 October 2022
should be read in conjunction with the Group's published annual report for the
period ended 30 April 2022 and the public announcements made by the Group
during the interim reporting period (accessible at www.oxcantech.com
(http://www.oxcantech.com) ).
The Group has continued to build on the positive start made to the current
financial year. During the period, progress was made on all four of the
Group's drug development programmes, particularly regarding the Group's lead
candidate OCT461201 ("Programme 1") as the Group prepared for Programme 1's
Phase I clinical trial to commence in January 2023. During the period the
Group added strength and depth to its advisory team by appointing Axis Capital
Markets Limited and finnCap Limited as its corporate brokers.
In August 2022 the Group held the first meeting of its Scientific Advisory
Board ("SAB"), which was formed in April 2022. The SAB's current members
include Professor Robert Dworkin, Professor Anthony Dickenson and Doctor
Giorgio Lambru. The SAB's core aim is to link the Group's pre-clinical
research and clinical trials with the needs of patients.
Programme 1
OCT461201, is a selective cannabinoid receptor type 2 agonist which has shown
potential as an effective therapy for chemotherapy induced peripheral
neuropathy ("CIPN") as well as irritable bowel syndrome ("IBS"). The global
market for CIPN alone was valued at US$1.61bn in 2020 and is forecast to reach
US$2.37bn by the year 2027. Work under the Group's £2.6 million contract
research agreement with Aptuit (Verona) SRL, a subsidiary of Evotec SE
(together "Evotec"), which commenced in July 2021 is now complete. Post
period-end, in December 2022 Evotec provided the Company with a
submission-ready regulatory document and will deliver an approved batch of
drug product to the Phase I clinical trial unit during Q1 2023.
In July 2022 the Company announced its master service agreement and work order
with Simbec Research Limited, part of the Simbec-Orion Group Ltd
("Simbec-Orion") for its first-in-human clinical trial for Programme 1. Work
on the Group's first Phase I clinical trial is due to commence in Q1 2023
using Simbec-Orion's Phase I clinical site, accredited by the UK Medicines
& Healthcare products Regulatory Agency ("MHRA"), which includes in-house
bioanalytical capabilities, and which is based in Merthyr Tydfil, Wales, UK.
Simbec-Orion will provide an end-to-end, full-service clinical development
solution including project management, medical and technical writing, medical
monitoring and pharmacovigilance, as well as bioanalytical and statistical
activities to support pharmacokinetic studies.
Post period-end, in January 2023 the Company announced submission of its
combined clinical trial application ("CTA") to the MHRA and Wales Research
Ethics Committee (REC) and attended the related REC review meeting. This Phase
I first-in-human clinical trial will be performed in healthy volunteers, with
a single ascending dose ("SAD"). The trial will be aimed at demonstrating the
safety and tolerability of the drug product, while providing pivotal
information on the pharmacokinetic profile of OCT461201 to confirm its value
as a potential drug. OCTP is awaiting the results of the review meeting and
will provide a further update on the outcome in due course.
Programme 2
In October 2021, the Company announced trigeminal neuralgia ("TN") as the
initial target for OCT130401. TN is a chronic pain condition that causes an
excruciating, stabbing, electric shock-like facial pain. It has a fast and
unexpected onset and because of this has been difficult to treat. Each episode
may only last a few seconds, but some people will suffer multiple (up to 100)
episodes during one day. It is on the rise with between approximately 10,000
and 15,000 new cases in the United States diagnosed each year. The Directors
estimate that in 2021 there were between 60,000 to 95,000 people living with
the condition in the UK.
During the period, pre-clinical work continued with the Group's research
partners, Charles Rivers Laboratories Edinburgh Ltd ("Charles Rivers"),
Purisys LLC ("Purisys") and Oz UK Ltd ("Oz UK"). Charles Rivers is working to
complete the preclinical safety and pharmacological activity for the metered
dose inhaler developed with Purisys, which provides the current Good
Manufacturing Practice ("cGMP") active product ingredients. Oz UK is
developing the formulation and the device. In August 2022 the Company
announced a strategic budget review, which realigned its development and
expenditure programme to focus on bringing Programme 1 through its Phase I
clinical trial and to extend the Group's cash runway.. As a result, the focus
for OCT1301401 shifted to completing pre-clinical work ensuring that Programme
2 is Phase I ready early in 2023, at which time further development will be
placed on hold.
Programmes 3 and 4
OCTP has progressed its work with Dalriada Drug Discovery Inc ("Dalraida") and
Oxford Stemtech Ltd ("Stemtech") during the period. Dalriada continued to
screen the Group's pharmaceutical cannabinoid derivative library, including
335 derivatives and 14 patent families, which was licensed from Canopy Growth
Corporation ("Canopy Growth") in September 2021 in addition to creating
additional cannabinoid derivatives, growing the Group's proprietary library by
50.
The drug development agreement with Stemtech is supporting R&D for all the
Company's drug development programmes, with a particular focus on Programmes 3
and 4. Stemtech's cutting-edge "Pain-in-a-dish" model replicates human pain
using stem cells from volunteers that are re-programmed into pain neurons.
The Group aims to be at pre-clinical stage (Programme 3) and lead candidate
stage (Programme 4) with these compounds in Q2 2023 at which time further
development will be paused.
The agreements signed across all of the Group's drug programmes reflect the
Group's core ethos: to partner with organisations recognised as
"best-in-class" that can drive quality and shareholder value. In a cannabis
market where unlicensed medicines remain abundant and unproven, our underlying
philosophy remains unchanged: that it is only the development of
cannabinoid-based medicines through existing channels of licensed drug
development that allows the medical community to prescribe drugs with
confidence and in volume.
Principal Risks and Uncertainties
The principal risks and uncertainties of the Group are as detailed in the
annual report and are summarised below. These risks and uncertainties are
reviewed throughout the year and since the annual report was issued for the
period ended 30 April 2022 no new principal risks have been identified.
The principal risks are as follows:
· unsuccessful or delayed development;
· cash flow and cash resources;
· key staff dependency;
· quality assurance;
· legal claims;
· unlicensed medical cannabis;
· reputational damage; and
· volatile share price.
Related Parties
There were no related party transactions in the period or changes in the
related party transactions described in the last annual report that have had
or could have a material effect on the financial position or performance of
the Group.
Related party disclosures for prior periods are given in note 8.
Going Concern and Viability Statement
The Group's business activities, together with the factors likely to affect
its future development, performance and position, are set out in the annual
report (accessible via www.oxcantech.com (http://www.oxcantech.com) ) and
remain unchanged for the six months ended 31 October 2022. Further
disclosure is given in note 2(b).
The Group prepares budgets and cashflow forecasts to ensure that the Group can
meet its liabilities as they fall due. Cash resources remain within forecast
at £5m which are expected to be fully utilised during Q1 2024. In line with
the IPO prospectus, the Board anticipate conducting the next fund raising
during the 2023/24 financial year, post the results of its Phase I trial.
The Directors remain confident that the Group is working in alignment with the
development plan set out in the IPO prospectus, despite extremely challenging
market conditions, not anticipated at the time of the IPO. Aside from the
decision to pause the clinical Phase I for OCT130401, original timelines are
being met, key partners have been onboarded and there is good progress across
all four programmes. The internal controls framework is being continually
refined and enhanced, and cash management remains disciplined.
Outlook
The fundamentals of the Group remain strong, delivering against the strategy
laid out in the IPO prospectus and with the Phase I clinical trial for
Programme 1 fully funded.
Clarissa Sowemimo-Coker
Chief Executive Officer
20 January 2023
Financial and Operational Highlights
Operational and financial highlights for the six months ended 31 October 2022
are as follows:
· OCT entered into a master service agreement and work order ("MSA")
with Simbec-Orion for its first-in-human Phase I clinical trial for its lead
compound, OCT461201 with the clinical trial due to commence in Q1 2023;
· In view of the continuing market uncertainty and an increasingly
challenging macro-economic outlook the Board agreed in August 2022 to
temporarily delay Phase I clinical trials of OCT130401, its second programme
enabling cash to be preserved and extending the cash runway of the Company;
· Development work for Programmes 3 and 4 continued, with the Company
still on target to be at pre-clinical stage (for programme 3) and lead stage
(for programme 4) with these programmes in Q2 2023;
· During the six-month period there were key staff changes at director
and operational level alongside changes in corporate brokers;
· OCTP established its Scientific Advisory Board shortly prior to the
period commencing with the first meeting held during this period;
· Research costs of £3,147k were incurred, of which £1,516k relates
to OCT461201 ("Programme 1"), with progress being made across all four of the
Group's programmes;
· As stated in the Company's last set of interim accounts the closure
of the London head office (from 31 March 2022) generates cost savings of over
£130k p.a.;
· Overall, administrative costs increased to £1.34m with the main
costs in the six months relating to salaries and associated expenses (£662k);
· The Group has accrued a Research and Development ("R&D") tax
credit of £840k in the six months. There was a debtor of £1,599k at the
period end relating to R&D tax credits (2021: £408k);
· Cash absorbed by operations was £4.2m (30 April 2022: £5.4m) (6
months to November 2021 £2.6m) and cash reserves stood at £4.9m at 31
October 2022 (30 April 2022: £9.2m).
Paul Smalley
Chief Financial Officer
20 January 2023
Directors' Statements
Responsibility Statement
The current Directors, whose names and functions are set out below, with the registered office located at Prama House, 267 Banbury Road, Oxford OX2 7HT, accept responsibility for the information contained in this unaudited interim report and condensed financial statements, which have not been audited by an independent auditor, for the six months ended 31 October 2022. To the best of the knowledge of the Directors:
· the unaudited condensed consolidated interim financial statements are
prepared in accordance with the applicable set of accounting standards
(including UK adopted IAS 34 Interim Financial Reporting), and give a true and
fair view of the assets, liabilities, financial position and profit or loss of
the Group and the undertakings included in the consolidation taken as a
whole; and
· the CEO's Interim Management Report includes a fair review of the
information required under rules 4.2.7 and 4.2.8 of the Disclosure Guidance
and Transparency Rules (being: (1) indication of the important events during
the first six months, and their impact on the unaudited condensed interim
financial statements: (2) a description of principal risks and uncertainties
for the remaining six months of the year; (3) related parties' transactions
that have taken place in the first six months of the current financial year
and that have materially affected the financial position or the performance
of the entity during that period; and (4) any changes in the related parties
transactions described in the last annual report that could have a material
effect on the financial position or performance of the enterprise in the first
six months of the current financial year).
The Directors confirm that the condensed interim financial statements comply with the above requirements.
Directors and their functions:
· Julie Pomeroy - Non-Executive Chairperson
· Dr John Lucas - Chief Executive Officer (resigned 02 December 2022)
· Clarissa Sowemimo-Coker - Interim Chief Executive Officer (appointed
02 December 2022, previously Chief Operating Officer)
· Paul Smalley - Finance Director (appointed 17 October 2022)
· Karen Lowe - Finance Director (resigned 17 October 2022)
· Bishrut Mukherjee - Non-Executive Director
· Neil Mahapatra - Non-Executive Director
· Charanjit Cheryl Dhillon - Non-Executive Director
· Richard Hathaway - Non-Executive Director
Forward Looking Statements
Certain statements in this announcement are forward-looking statements. Such
statements may relate to OCTP's business, strategy and plans.
Statements that are not historical facts, including statements about OCTP's or
its management's beliefs and expectations, are forward-looking statements.
Words such as 'believe', 'anticipate', 'estimates', 'expects', 'intends',
'aims', 'potential', 'will', 'would', 'could', 'considered', 'likely', and
variations of these words and similar future or conditional expressions are
intended to identify forward-looking statements but are not the exclusive
means of doing so.
By their nature, forward-looking statements involve a number of risks,
uncertainties or assumptions, some known and some unknown, many of which are
beyond OCTP's control that could cause actual results or events to differ
materially from those expressed or implied by the forward-looking statements.
These risks, uncertainties or assumptions could adversely affect the outcome
and financial effects of the plans and events described herein.
Forward-looking statements contained in these interim financial accounts
regarding past trends or activities should not be taken as a representation
that such trends or activities will continue in the future. Nor are they
indicative of future performance and OCTP's actual results of R&D and
financial condition and the development of the industry and markets in which
OCTP plan to operate may differ materially from those made in or suggested by
the forward-looking statements.
You should not place undue reliance on forward-looking statements because such
statements relate to events and depend on circumstances that may or may not
occur in the future. Except as required by law, OCTP is under no obligation to
update (and will not) or keep current the forward-looking statements contained
herein or to correct any inaccuracies which may become apparent in such
forward-looking statements. Forward-looking statements reflect OCTP's
judgement at the time of preparation of these unaudited interim condensed
financial statements and are not intended to give any assurance as to future
result.
Robin Bennett
Company Secretary
20 January 2023
Unaudited Condensed Consolidated Statement of Comprehensive Income
6 months 6 months ended 30 November 2021 11 months ended 30 April
ended 31 October 2022
2022
Notes £ £ £
Unaudited Unaudited Audited
Revenue - - -
Research costs (3,147,451) (934,513) (2,891,497)
Gross loss (3,147,451) (934,513) (2,891,497)
Administrative expenses (1,337,724) (1,197,271) (2,320,292)
Exceptional items 4 (60,535) (204,317) (291,598)
Operating loss (4,545,710) (2,336,101) (5.503.387)
Finance income - 35,910 -
Finance costs - - -
Loss before taxation (4,545,710) (2,300,191) (5,503,387)
Income tax 5 839,536 269,146 791,058
Loss for the period (3,706,174) (2,031,045) (4,712,329)
Other comprehensive income - - -
Items that may be reclassified to profit or loss - - -
Total comprehensive income for the period attributable to owners of the Group (3,706,174) (2,031,045) (4,712,329)
arising from continuing operations
Loss per share attributable to the ordinary equity holders of the Company:
Basic loss per share from continuing and total operations 6 (0.386p) (0.211p) (0.491p)
Diluted loss per share from continuing and total operations (0.386p) (0.211p) (0.491p)
Unaudited Condensed Consolidated Statement of Financial Position
6 months ended 31 October 6 months ended 30 November 2021 11 months ended 30
2022 April
2022
Notes £ £ £
Unaudited Unaudited Audited
Non-current assets
Intangible assets 26,676 82,251 46,080
Property, plant and equipment - 16,961 -
Right-of-use assets - 4,226 -
26,676 103,438 46,080
Current assets
Trade and other receivables 2,466,932 842,344 2,606,616
Cash and cash equivalents 4,932,828 12,014,856 9,165,596
7,399,760 12,857,200 11,772,212
Total assets 7,426,436 12,960,638 11,818,292
Current liabilities
Trade and other payables 1,279,047 518,146 2,025,264
Lease liabilities - 55,461 -
Total current liabilities 1,279,047 573,607 2,025,264
Total liabilities 1,279,047 573,607 2,025,264
Net assets 6,147,389 12,387,031 9,793,028
Equity
Called up share capital 9,604,156 9,604,156 9,604,156
Share premium account 11,877,466 11,877,466 11,877,466
Share based payment reserve 9 1,510,143 1,362,327 1,449,608
Other reserve 643,455 643,455 643,455
Retained earnings (17,487,831) (11,100,373) (13,781,657)
Total equity 6,147,389 12,387,031 9,793,028
These unaudited condensed six-monthly financial statements were approved and
authorised for issue by the Board of Directors on 20 January 2023 and were
signed on its behalf by:
Paul Smalley
Finance Director
Company Registration No. 13179529
Unaudited Condensed Consolidated Statement of Changes in Equity
Share capital Share premium account Share based payment reserve Other Retained Total
reserve earnings
£ £ £ £ £ £
Unaudited
At 1 June 2021 9,604,156 11,877,466 1,158,010 643,455 (9,069,328) 14,213,759
Loss for the period - - - - (4,712,329) (4,712,329)
Other comprehensive income - - - - - -
Total comprehensive loss - - - - (4,712,329) (4,712,329)
Transactions with owners
Share-based payment charge (warrants) - - 202,953 - - 202,953
Share-based payment charge (options) - - 88,645 - - 86,645
Total transactions with owners - - 291,598 - - 291,598
Balance at 30 April 2022 9,604,156 11,877,466 1,449,608 643,455 (13,781,657) 9,793,028
Share capital Share premium account Share based Retained earnings Total
£ £ payment reserve Other £ £
£ reserve
£
At 1 May 2022 9,604,156 11,877,466 1,449,608 643,455 (13,781,657) 9.793.028
Loss for the period - - - - (3,706,174) (3,706,174)
Other comprehensive income - - - - - -
Total comprehensive loss - - - - (3,706,174) (3,706,174)
Transactions with owners
Share-based payment charge (warrants) - - 12,153 - - 12,153
Share-based payment charge (options) - - 48,382 - - 48,382
Total transactions with owners - - 60,535 - - 60,535
Balance at 31 October 2022 9,604,156 11,877,466 1,510,143 643,455 (17,487,831) 6.147,389
Unaudited Condensed Consolidated Statement of Cash Flows
6 months ended 31 October 6 months 11 months
2022 ended 30 November ended
£ 2021 30 April
£ 2022
£
Unaudited Unaudited Audited
Cash flows from operating activities
Cash absorbed from operations (4,402,751) (2,584,779) (5,373,021)
Tax refunded 169,983 - -
Net cash (outflow)/inflow from operating activities (4,232,768) (2,584,779) (5,373,021)
Cash flows from investing activities
Proceeds from disposal of property, plant and equipment - - 2,500
Interest received - 35,910 -
Net cash inflow from investing activities - 35,910 2,500
Cash flows from financing activities
Repayment of borrowings - (50,000) (50,000)
Lease liability payments - (17,076) (44,684)
Net cash used in financing activities - (67,076) (94,684)
Net decrease in cash and cash equivalents (4,232,768) (2,615,945) (5,465,205)
Cash and cash equivalents at the beginning of the period 9,165,596 14,630,801 14,630,801
Cash and cash equivalents at the end of the period (#_bookmark30) 4,932,828 12,014,856 9,165,596
Notes to the Condensed Consolidated Interim Financial Statements
1 General Information
Oxford Cannabinoid Technologies Holdings Plc is a public limited company
limited by shares, incorporated and domiciled in England and Wales. Its
registered office and principal place of business is Prama House, 267 Banbury
Road, Oxford OX3 7HT. Incorporated on 4 February 2021, the Company's shares
were admitted to trading on the London Stock Exchange on 21 May 2021.
All press releases, financial reports (including the Annual Report and
Financial Statements for the period ended 30 April 2022) and other information
are available at our Shareholder Centre on our website: www.oxcantech.com
(http://www.oxcantech.com) .
The condensed consolidated interim financial statements are presented in Pound
Sterling (£).
2 Summary of Significant Accounting Policies
The accounting policies applied by the Group in these condensed consolidated
interim financial statements are consistent with those applied by the Group in
its consolidated financial statements for the period ended 30 April 2022 and
are those which will form the basis of the financial statements for the year
ending 30 April 2023.
2(a) Basis of preparation
Compliance with UK Adopted IFRS
These unaudited condensed consolidated interim financial statements for the
six months ended 31 October 2022 have been prepared in accordance with UK
Adopted IAS 34 'Interim Financial Reporting', and the Disclosures Guidance and
Transparency Rules ("DTR") of the Financial Conduct Authority, the Listing
Rules, and UK adopted International Accounting Standards.
These unaudited condensed consolidated interim financial statements should be
read in conjunction with the Annual Report and financial statements for the
period ended 30 April 2022, which were prepared in accordance with UK adopted
International Accounting Standards and the applicable legal requirements of
the Companies Act 2006. These condensed consolidated interim financial
statements do not comprise statutory accounts within the meaning of Section
435 of the Companies Act 2006.
The Annual Report and financial statements for the period ended 30 April 2022
were reported upon by the Group's auditor and delivered to the Registrar of
Companies. The report of the auditor on the annual report and financial
statements for the period ended 30 April 2022 was unqualified, did not include
a reference to any matters to which the auditor drew attention by way of
emphasis without qualifying their report and did not contain statements under
Section 498 (2) or (3) of the Companies Act 2006.
The accounting policies used and presentation of these condensed consolidated
half year financial statements (including principles of consolidation and
equity accounting) are consistent with the accounting policies applied by the
Group in its consolidated annual report and financial statements as at, and
for the period ended, 30 April 2022, and comply with UK adopted International
Accounting Standards.
The half year report for the six months ended 31 October 2022 was approved for
release by the Directors on 20 January 2023. The figures for the six months
ended 30 November 2021 and those for the six months ended 31 October 2022 are
neither audited nor reviewed by auditors pursuant to the Financial Reporting
Council guidance on Review of Interim Financial Information.
2(b) Going concern
The Directors are required to satisfy themselves that it is reasonable for
them to conclude whether it is appropriate to prepare the financial statements
on a going concern basis, and as part of that process they have followed the
Financial Reporting Council's guidelines ("Guidance on the Going Concern Basis
of Accounting and Reporting on Solvency and Liquidity Risk" issued April
2016).
The Group's business activities together with factors that are likely to
affect its future development and position are set out in the Chairperson's
statement, the CEO's Review and Financial Review of the Annual Report and
Financial Statements for the period ended 30 April 2022 (accessible via
www.oxcantech.com), in addition to the CEO's Management Statement in this
interim report. Budgets and detailed cashflow forecasts that look beyond
twelve months from the date of these condensed consolidated interim financial
statements have been prepared and used to ensure that the Group can meet its
liabilities as they fall due. The Directors have made various assumptions in
preparing these forecasts, using their view of both the current and future
economic conditions that may impact on the Group during the forecast
period.
Key risks and potential scenarios that could negatively impact on the Group's
ability to continue to research and ultimately develop and retail prescribed
medicines within the timescale detailed within the IPO prospectus have been
considered, and risks mitigated as far as is practical and reasonable.
The Board anticipate making an equity fund raise within the 2023/24 financial
year, in order to provide further financial resources to progress with the
next stages of the research programmes.
The Directors note the global supply chain issues and challenges in the
capacity of partners caused by the increased demand in laboratory time
generated by COVID-19 and they continue to monitor the situation. Due to the
nature of the Group's activities, there has not been a significant on-going
impact on the business. Nonetheless, the Directors continue to monitor the
situation and, if required, will take steps to safeguard the assets of the
Group whilst the challenges caused by the pandemic continue.
After making enquiries including detailed consideration of the Group's
cashflow, solvency and liquidity position, the Board has a reasonable
expectation that OCTP, OCT and the Group as a whole in its current state has
adequate resources to continue in operational existence for at least twelve
months from the date of signing of these unaudited condensed six-monthly
financial statements. As such, the Board continues to adopt the going
concern basis in preparing the unaudited condensed six-monthly financial
statements.
2(c) Leases
The Group leased the head office in London under a five-year lease period and
office equipment. In November 2021, the Group exercised its right under the
agreement to terminate the lease with effect from 31 March 2022. This has
not had any material impact on the value of the right-of-use asset in the
six-month period to 31 October 2022.
2(d) Property, plant and equipment
Property, plant and equipment is stated at historical cost less depreciation.
Historical cost includes expenditure that is directly attributable to the
acquisition of the items. Depreciation is calculated using the
straight-line method to allocate the cost or revalued amounts of the assets,
net of any residual values, over the lease term for leasehold improvements and
estimated useful lives for office and computer equipment, being 5 years for
all three categories.
2(e) New and forthcoming standards and interpretations
New and amended standards adopted by the Group
There were no new or amended standards adopted by the Group during the review
period.
New standards and interpretations not yet adopted
A number of new accounting standards, amendments to accounting standards and
interpretations have been issued by the International Accounting Standards
Board with an effective date after the date of these financial statements. The
Directors have chosen not to early adopt these standards and interpretations,
the Directors do not expect them to have a material impact on the entity in
the current or future reporting periods and on foreseeable future
transactions.
Effective date
IAS 1 Presentation of Financial Statements - amendments regarding the classification 1 January 2023
of liabilities
IAS 1 Presentation of Financial Statements - amendments regarding the disclosure of
accounting policies
1 January 2023
IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors - amendments
regarding the definition of accounting estimates
1 January 2023
3 Critical Estimates and Judgements
The preparation of financial statements requires the use of accounting
estimates which, by definition, will seldom equal the actual results.
Management also needs to exercise judgement in applying the Group's accounting
policies. However uncertainty about these assumptions and estimates could
result in outcomes that would require a material adjustment to the carrying
amount of the asset or liability in future periods.
Estimates and judgements are continually evaluated. They are based on
historical experience and other factors, including expectations of future
events that may have a financial impact on the entity and that are believed to
be reasonable under the circumstances. The areas involving significant
estimates or judgements which management consider may have a significant risk
of causing a material adjustment to the reported amounts in the period were:
Going concern basis
As outlined in note 2(b), judgement has been applied in accounting for the
Group as a going concern. In reaching the decision the Directors have
considered current cash reserves and forecast cashflow, solvency and
liquidity. The forecasts are based on various assumptions including charges
from research partners, rate of progression through to commercialisation, and
external economic conditions.
Research & development costs
Judgement is used in the classification and hence treatment of costs incurred
in the research and development of the core programmes outlined in the CEO's
Interim Management Statement. During the period all of the £3,147k costs
incurred were accounted for as research costs and expensed to profit or loss,
on the basis that none of the programmes were yet at a stage of having gained
regulatory approval for commercialisation.
R&D tax credits receivable
Judgement is applied in calculating the tax credits that the Group consider to
be receivable from HMRC in relation to research costs incurred. Evidence is
retained to support the methodology adopted by the Group in calculating
R&D tax relief claims, part of which involves the judgement of experienced
Senior Managers and Directors in articulating the scientific advancements and
uncertainties for the wider market of the Group's research programmes based on
contemporaneous evidence. At the period end there was a tax credit receivable
of £1,599k (2021: £408k).
Impairment of intangible fixed assets
Judgement is involved in determining the useful economic life and potential
impairment of the licence intangible asset held by the Group at a net book
value of £27k. This includes consideration of the continuing likelihood of
the asset to generate value to the Group and the adherence to the terms of the
agreement or any other event which may have a detrimental effect on the
carrying value of the asset. The Directors have carried out an impairment
review of the asset during the period with no impairment charge considered
necessary.
Warrants and share options
The Black-Scholes model is used to calculate the appropriate charge of the
warrants and share options. The calculation involves a number of estimates
and judgements to establish the appropriate inputs to be entered into the
model, including the use of an appropriate interest rate, expected volatility,
exercise restrictions and behavioural considerations. A significant element of
judgement is therefore involved in the calculation of the charge. The
estimates used remain unchanged from those applied in the Annual Report and
Financial Statements.
4 Exceptional Items
The Condensed Consolidated Statement of Comprehensive Income includes
exceptional items totalling £61k (31 October 2022) comprised entirely of a
share-based payment charge (30 April 2022: £204k).
The Group operates two share option schemes for its Directors and senior
employees one relating to options transferred from OCT and a new scheme for
OCTP. In addition, warrants were issued as part of the listing in May 2021 (as
detailed in the Annual Report and Financial Statements).
5 Income Tax
The Group is pre-revenue generating, but on target to reach commercialisation
in 2027. The Group benefits from research and development corporation tax
relief in both the current period and prior years claimed by the Group on
allowable research expenditure. A deferred tax asset is not recognised due to
the uncertainty of the timing of future taxable profits.
6 Loss Per Share
6 months 6 months 11 months
to 31 Oct 2022 to 30 Nov 2021 to 30 April 2022
£ £ £
Unaudited Unaudited Audited
6(a) Basic loss per share
Basic loss per share attributable to the ordinary equity holders of the (0.00386) (0.00491)
Company
(0.00211)
6(b) Diluted loss per share
From continuing operations attributable to the ordinary equity holders of the (0.00386) (0.00491)
Company
(0.00211)
Total diluted loss per share attributable to the ordinary equity holders of (0.00386) (0.00491)
the Company
(0.00211)
6(c) Reconciliations of loss used in calculating loss per share
6 months 6 months 11 months
to 31 Oct to 30 Nov to 30 April
2022 2021 2022
£ £ £
Unaudited Unaudited Audited
Basic loss per share
Loss attributable to the ordinary equity holders of the Company used in (3,706,174) (2,031,045) (4,712,329)
calculating basic loss per share:
Diluted loss per share
Loss from continuing operations attributable to the ordinary equity holders of
the Company:
Used in calculating basic loss per share (3,706,174) (2,031,045) (4,712,329)
Used in calculating diluted loss per share (3,706,174) (2,031,045) (4,712,329)
Loss attributable to the ordinary equity holders of the Company used in (3,706,174) (2,031,045) (4,712,329)
calculating diluted loss per share
6(d) Weighted average number of shares used as the denominator
31 Oct 2022 30 Nov 2021 30 April 2022
Number Number Number
Weighted average number of ordinary shares used as the denominator in
calculating basic loss per share
960,415,644 960,415,644 960,415,644
Adjustments for calculation of diluted loss per share: - - -
Weighted average number of ordinary shares and potential ordinary shares used
as the denominator in calculating diluted loss per share
960,415,644 960,415,644 960,415,644
7 Events Occurring After the Reporting Period
In December 2022, Chief Executive Officer, John Lucas resigned from the Board
and Chief Operating Officer, Clarissa Sowemimo-Coker was appointed Interim
Chief Executive Officer. On 12 January 2023, the Board appointed Robin Bennett
to replace Clarissa Sowemimo-Coker as Company Secretary.
In January 2023 the Company submitted a combined clinical trials application
for its lead programme, OCT461201, to the UK Medicines & Healthcare
products Regulatory Agency (MHRA) and Wales Research Ethics Committee (REC)
(the "Submission") and attended the related REC review meeting. The Submission
follows the successful completion of OCTP's extensive pre-clinical work on
OCT461201, under the Group's £2.6 million contract research agreement with
Aptuit (Verona) SRL, a subsidiary of Evotec SE.
8 Related Party Transactions
The Group is headed by Oxford Cannabinoid Technologies Holdings Plc, the
ultimate parent entity. There is no ultimate controlling party.
There were no related party transactions in the period or changes in the
related party transactions described in the last annual report that have had
or could have a material effect on the financial position or performance of
the Group.
The following transaction occurred with other related parties in a prior
period:
Between December 2021 and January 2022, the Group paid £35,994 for
professional services on behalf of Kingsley Capital Partners (KCP)
(shareholder). This was included as a receivable in the Unaudited Condensed
Consolidated Statement of Financial Position at the period end.
9 Share based payments
During the six-month period ended 31 October 2022, no new options or warrants
were issued and none of the existing options and warrants were exercised.
As detailed in the Annual Report, the Group operates an equity-settled
share-based remuneration scheme for employees. On 21 May 2021, OCTP issued a
total of 33,307,275 warrants all with an exercise price of £0.05 and a
five-year exercise period, vesting on the day of issue.
During the period, the Group recognised share-based payment expense of:
· £12,153 (30 November 2021: £96,763) in relation to options; and
· £48,382 (30 November 2021: £107,554) in relation to the warrants.
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