REG - Shield Therapeutics - Business Update for Q1 2024

Shield TherapeuticsAnnouncement

30/04/2024 07:00

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RNS Number : 4943M  Shield Therapeutics PLC  30 April 2024

Shield Therapeutics plc

("Shield" or the "Company" or the "Group")

 

Business Update for Q1 2024 and Confirmation of Key Financials for FY 2023

 

Total U.S. Accrufer® prescriptions increased to c. 77,000 in 2023 and
totalled c. 28,800 in Q1 2024

 

Cash and financial foundation strengthened via a $10m accounts receivable
financing and improvement of revenue covenants associated with the existing
$20m debt financing

 

Guidance reiterated to turn cashflow positive in H2 2025

 

London, UK, April 30, 2024:  Shield Therapeutics plc (LSE: STX), a
commercial-stage pharmaceutical company that delivers Accrufer®/Feraccru®
(ferric maltol), an innovative and differentiated specialty pharmaceutical
product, to address a significant unmet need for patients suffering from iron
deficiency (with or without anaemia) provides a business update for Q1 2024
and confirms its key financials for the year ended 31 December 2023. Whilst
the Company's audit process for the year ended 31 December 2023 is
significantly advanced, additional time is required to finalise the
translation of the Group's presentational currency from GBP to USD. The
Company now expects to issue its fully audited results for FY23 before 10 May
2024. The details provided in the full year trading
(https://www.londonstockexchange.com/news-article/STX/unaudited-full-year-trading-update/16341507)
update remain unchanged.

 

2023 Key Business Metrics: confirmed as previously reported on 21 February
2024
(https://www.londonstockexchange.com/news-article/STX/unaudited-full-year-trading-update/16341507)

·    Total 2023 revenue and other income: $17.5m, a 2.8x increase over
FY22

o  Accrufer® revenue: $11.6m, a 3.1x increase over FY22

o  Ex-U.S. revenue: $1.5m of royalty revenue from product sales in Europe

o  Other income revenue including Viatris milestone payments: $4.4m

·    Total 2023 Prescriptions: c.77,000, a 310% increase over FY22

·    Operating Loss: $31.1m compared to $49.8m in FY22

·    Cash and cash equivalents: $13.9m as of 31 December 2023

 

Q1 2024 Update

During the first quarter of 2024, Shield reported net revenues of $4.0m from
c.28,800 prescriptions of Accrufer®. In addition, the Company strengthened
its balance sheet through an accounts receivable financing with Sallyport
Commercial Finance (Sallyport) and amended its existing $20m debt facility
agreement with SWK Funding LLC (SWK), with more favourable loan covenant
terms. Shield also expects to turn cashflow positive in H2 2025 with its
current resources.

 

Q1 2024 Key Business Metrics:

·    Total US Accrufer revenue: $4.0m with an Average Net Selling Price of
c. $140/prescription

·    Total Q1 Prescriptions: c.28,800, a 1% rise over Q4 2023 and 174%
increase over Q1 2023.

o  Shield has worked very closely with its third-party data provider to
rectify the prescription reporting issue and has implemented an enhanced
multi-source system

·    New Financing: secured a $10m accounts receivable financing and
signed an amendment to improve the revenue covenants associated with the
existing SWK $20m debt financing (additional details at end of this
announcement)

·    Cash and cash equivalents: $10.4m as of 31 March 2024

 

First quarter Accrufer® prescriptions of c.28,800 increased by 174% compared
to Q1 2023 and 1% compared to Q4 2023. Strong quarterly growth of c.29% in the
largest US states California and New York and positive changes in prior
authorisation (PA) submission rates were offset by a 28% decline in Texas due
to a transition and lack of a Texas State Medicaid Pharmacy Benefit Manager
(PBM) during the quarter, which resulted in significant inconsistencies in PA
approvals for Accrufer® Medicaid prescriptions. The new PBM began on 1 April
2024 and Shield is working on behalf of its Health Care Providers (HCPs) and
patients in Texas to enable greater consistency in PA requirements and
approvals.

 

Greg Madison, CEO of Shield Therapeutics, commented: "We observed several
encouraging growth signals during Q1 2024 including rising prescriptions in
key states such as California and New York, after receiving access to Medicaid
in those populous states. Additionally, our stated initiatives to improve the
average net selling price by increasing PA submission rates and more
favourable Medicaid pricing following renegotiation of payer contracts, are
progressing very well. While the situation in Texas dampened the impact of
these positives, we are engaged with the new PBM with the aim of finding a
resolution as quickly as possible."

 

"We continue to believe that Accrufer® addresses an important unmet market
need for a safe and well tolerated oral iron therapy. We fully expect to
continue growth in prescriptions in Q2 and beyond and will continue to focus
on increasing our average net selling price with targeted investments such as
the new field access team, deployed in early April, to assist HCP offices with
PA support and education. The belief, passion and motivation to succeed by
both Shield and Viatris was readily evident at our recent National Sales
Meeting. We remain focused on our mission to make Accrufer® the oral iron of
choice for patients with iron deficiency, with or without anaemia."

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 (as it forms part of domestic law by virtue of the European
Union (Withdrawal) Act 2018). Upon the publication of this announcement via
the Regulatory Information Service, this inside information is now considered
to be in the public domain.

 

For further information please contact:

 

 Shield Therapeutics plc                                                                        www.shieldtherapeutics.com (http://www.shieldtherapeutics.com/)
 Greg Madison, CEO                                                                              +44 (0) 191 511 8500

 Santosh Shanbhag, CFO

 Nominated Adviser and Joint Broker
 Peel Hunt LLP
 James Steel/Patrick Birkholm                                                                   +44 (0)20 7418 8900

 Joint Broker

 Cavendish Ltd

 Geoff Nash/ George Dollemore/Nigel Birks/Harriet
 Ward

                                                                                                +44 (0)20 7220 0500

 Financial PR & IR Advisor
 Walbrook PR
 Charlotte Edgar / Alice Woodings                                                               +44 (0)20 7933 8780 or shield@walbrookpr.com (mailto:shield@walbrookpr.com)

 Investor Contact (US Advisor)

 LifeSci Advisors, LLC

 Joyce Allaire                                                                                  jallaire@lifesciadvisors.com (mailto:jallaire@lifesciadvisors.com)

 

About Iron Deficiency and Accrufer®/Feraccru®

Clinically low iron levels (aka iron deficiency, ID) can cause serious health
problems for adults of all ages, across multiple therapeutic areas. Together,
ID and ID with anaemia (IDA) affect about 20 million people in the U.S. and
represent a $2.3B market opportunity. As the first and only FDA approved oral
iron to treat ID/IDA, Accrufer® has the potential to meet an important unmet
medical need for both physicians and patients.

 

Accrufer®/Feraccru® (ferric maltol) is a novel, stable, non-salt-based oral
therapy for adults with ID/IDA. Accrufer®/Feraccru® has a novel mechanism of
absorption compared to other oral iron therapies and has been shown to be an
efficacious and well-tolerated therapy in a range of clinical trials. More
information about Accrufer®/Feraccru®, including the product label, can be
found at: www.accrufer.com (http://www.accrufer.com) and www.feraccru.com
(http://www.feraccru.com) .

 

About Shield Therapeutics plc

Shield is a commercial-stage specialty pharmaceutical company that delivers
Accrufer®/Feraccru® (ferric maltol), an innovative and differentiated
pharmaceutical product, to address a significant unmet need for patients
suffering from iron deficiency, with or without anaemia. The Company has
launched Accrufer® in the U.S. with an exclusive, multi-year commercial
agreement with Viatris Inc. (Viatris). Outside of the U.S., the Company has
licensed the rights to four specialty pharmaceutical companies. Feraccru® is
commercialised in the UK and European Union by Norgine B.V. (Norgine), which
also has marketing rights in Australia and New Zealand. Shield also has an
exclusive license agreement with Beijing Aosaikang Pharmaceutical Co., Ltd.,
for the development and commercialisation of Accrufer®/ Feraccru® in China,
Hong Kong, Macau and Taiwan; with Korea Pharma Co., Ltd. for the Republic of
Korea (Korea Pharma); and with KYE Pharmaceuticals Inc. for Canada.

 

Accrufer®/Feraccru® has patent coverage until the mid-2030s.

Accrufer®/Feraccru® are registered trademarks of Shield Therapeutics.

 

Forward-Looking Statements:

This press release contains forward-looking statements. All statements
contained in this press release that do not relate to matters of historical
fact should be considered forward-looking statements.  These forward-looking
statements are based on management's current expectations and include
statements related to the commercial strategy for Accrufer®/Feraccru®. These
statements are neither promises nor guarantees, but involve known and unknown
risks and uncertainties, many of which are beyond our control, that may cause
actual results and performance or achievements to be materially different from
management's expectations expressed or implied by the forward-looking
statements, including, but not limited to, risks associated with the Company's
business and results of operations, competition, and other market factors.
The forward-looking statements made in this press release represent
management's expectations as of the date of this press release, and except as
required by law, the Company disclaims any obligation to update any
forward-looking statements contained in this release, even if subsequent
events cause its views to change.

 

Additional details on the Sallyport Commercial Finance Accounts Receivable
Financing

Shield has implemented an accounts receivable financing facility with
Sallyport Commercial Finance for $10m. The facility has been provided for a
period of 12 months with an option to renew at existing terms. The facility
will be secured by Accrufer® accounts receivables in the U.S. and will bear
an interest rate of WSJ Prime + 3.0% on funds deployed.

 

Additional details on the amendment to the SWK Financing

Shield and SWK Financing have amended the existing agreement on the $20m term
loan with a maturity date of 28 September 2028. The amendment includes an
update to the financial covenant of minimum revenue targets, as outlined
below, and a change in the final payment fee from 6.0% to 6.5%.

 

 Trailing Four Fiscal Quarters (i.e., 12 months) Ended  Revised minimum revenue targets
 Q3 2023                                                 $8,500,000
 Q4 2023                                                 $14,500,000
 Q1 2024                                                $15,000,000
 Q2 2024                                                $16,500,000
 Q3 2024                                                $22,500,000
 Q4 2024                                                $31,500,000
 Q1 2025                                                $38,900,000
 Q2 2025+                                               $45,700,000

 

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