REG - Shield Therapeutics - Q3 Trading Update

Shield TherapeuticsAnnouncement

29/10/2024 07:00

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RNS Number : 9478J  Shield Therapeutics PLC  29 October 2024

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 in the United Kingdom 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.

 

 
Shield Therapeutics plc

("Shield" or the "Company")

 

Q3 Trading Update

 

ACCRUFeR® US Net Revenues of $7.2 million following 20% Increase in Q3
Prescriptions over Q2

and 86% increase over Q3 2023

 

Financial foundation strengthened via accounts receivable financing expansion
to $15 million and

implementation of a 10% cost saving plan to the Group's operating cost base

 

Non-binding terms agreed with AOP Health for the provision of $10 million of
new equity to drive growth, expecting positive cash flow by the end of 2025

 

London, UK, 29 October 2024: Shield Therapeutics plc (LSE: STX), a commercial
stage pharmaceutical company specialising in iron deficiency, provides an
unaudited trading update for Q3 2024 as well as confirming a $5 million
extension to its working capital financing facility with Sallyport Commercial
Finance ("Sallyport"), the implementation of a 10% cost saving plan to its
operating cost base, and the entering into of a non-binding term sheet with
AOP Health International Management AG ("AOP Health") for the potential
provision of $10 million of new equity.

 

ACCRUFeR® performance

During the third quarter of 2024, Shield reported net revenues of $7.2 million
from c.43,500 prescriptions of ACCRUFeR® with an average net selling price of
$167 ("NSP") per prescription that included the impact of the summer buying
pattern by wholesalers and pharmacies in June and July. Excluding July, the
average NSP in Q3 was $192 per prescription and expectations are that NSP can
be maintained at a similar level throughout Q4. Key Performance Indicators
(KPIs) for Q3 2024 were:

·    Total ACCRUFeR® Net Sales: $7.2 million, representing 4% growth
compared to $6.9 million in Q2 24 and 76% growth compared to Q3 2023. The
growth rate difference between revenues and prescription demand are due to the
impact of wholesalers buying ahead of the July 4th weekend during the last
week of June.

·    Total Prescriptions: -c. 43,500, an increase of 20% over Q2 2024 and
an 86% increase over Q3 2023.

·    Average net selling price: $167 per prescription vs. $171 in Q2 2024
and $148 in Q3 2023. Excluding July, the average net selling price in Q3 2024
was $192 per prescription.

·    Total Group Revenues: $8.0 million including royalties and milestones
from global partners for Q3 2024 resulting in $20.0 million of revenue for the
9 months ended 30 September 2024. The Board's internal estimates indicate that
trading remains in line with market expectations for 2024 and is expected to
meet the total revenue covenant target of $31.5 million for full year 2024
under the debt facility agreement with SWK Funding LLC.

 

Balance sheet and cash resources

 

At 30 September 2024 Shield held cash and cash equivalents of $7.7 million vs.
$8.1 million as at 30 June 2024.

 

Following analysis of the Q3 2024 ACCRUFeR® performance and the consequential
impact on internal projections, the Board has concluded that additional
capital is required whilst also taking measures to lower its operating cost
base to help achieve the Company's goal of becoming cash flow positive by the
end of 2025. Accordingly, Shield has agreed an expansion of its working
capital financing with Sallyport from $10 million to $15 million and is
implementing a reduction of 10% to its operating cost base to extend its cash
runway, based on current internal estimates, into Q2 2025. Shield has also
entered into a non-binding term sheet with AOP Health for the provision of $10
million of new equity to help the Company achieve its aim of becoming cash
flow positive by the end of calendar 2025.  Shield's rate of cash burn
remains highly dependent on the sales growth for ACCURUFeR® achieving the
Company's internal forecast.

 

Additional support from AOP Health

 

Shield's largest shareholder, AOP Health, has executed a non-binding term
sheet to subscribe for ordinary shares of 1.5 pence each in Shield ("Ordinary
Shares") at a subscription price of 4.0 pence per Ordinary Share, to raise
aggregate gross proceeds of a minimum of $10 million (the "Subscription").
Should the Subscription proceed, AOP Health (excluding any of its concert
parties) would come to hold shares carrying more than 50% of the voting rights
in Shield. Therefore, the Subscription is conditional, inter alia, upon the
(i) granting of a waiver by The Panel on Takeovers and Mergers (the "Takeover
Panel") from the obligation of AOP Health to make an offer under Rule 9 of the
Takeover Code; (ii) approval of the waiver proposed to be granted by the
Takeover Panel, by an independent vote of Shield's shareholders (excluding AOP
Health and its concert parties), at a meeting of Shield's shareholders (the
"General Meeting"); and (iii) approval of the issue and allotment of the
Ordinary Shares in connection with the Subscription for the purposes of the
Companies Act 2006, at the General Meeting. The Subscription would also be a
related party transaction under the AIM Rules.  Further details of the
Subscription and the General Meeting will be made available to the public via
the Regulatory Information Service and will be included in a circular to be
posted to Shield's shareholders and made available on Shield's website in Q4
2024. Shield may incorporate a broader equity offering to existing
shareholders and other investors should the Subscription proceed.

 

If the Subscription is approved by Shield shareholders, AOP Health and their
concert parties would subsequently be able to increase its aggregate interest
in Ordinary Shares without incurring any obligation to make an offer for the
Company under Rule 9 of the Takeover Code.

 

There can be no certainty that the Subscription will proceed, and Shield will
make further announcements as required.

 

Anders Lundstrom, Interim Chief Executive Officer, commented: "It has been
another successful quarter for Shield as we work towards becoming cash flow
positive by the end of FY 2025. We continue to see increased demand for
ACCRUFeR® in the US and across all our territories. Net sales, total
prescriptions and the net selling price of ACCRUFeR® are all showing positive
trends, and with a strengthened balance sheet and tight control of our cost
base we will continue to build momentum behind ACCRUFeR® and make the steps
required to transition to cash flow positive by the end of 2025."

 

Investor presentation

Interim CEO, Anders Lundstrom, and CFO, Santosh Shanbhag, will be hosting a
live online presentation relating to the Q3 trading update via the Investor
Meet Company platform at 2pm (GMT) on Thursday 31 October 2024.

 

The presentation is open to all existing and potential investors. Questions
can be submitted pre-event via your Investor Meet Company dashboard up until
9am (GMT) the day before the meeting or at any time during the live
presentation.

 

Investors can sign up to Investor Meet Company for free and add to
meet Shield Therapeutics plc via:

https://www.investormeetcompany.com/shield-therapeutics-plc/register-investor
(https://www.investormeetcompany.com/shield-therapeutics-plc/register-investor)

 

Investors who already follow Shield Therapeutics plc on the Investor Meet
Company platform will automatically be invited.

 

For further information please contact:

 

 Shield Therapeutics plc                                                                        www.shieldtherapeutics.com (http://www.shieldtherapeutics.com/)
 Anders Lundstrom, interim 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/ Rory Sale /Nigel Birks/Harriet
 Ward

                                                                                                +44 (0)20 7220 0500

 Financial PR & IR Advisor
 Walbrook PR
 Lianne Applegarth / Alice Woodings                                                             +44 (0)20 7933 8780 or shield@walbrookpr.com (mailto:shield@walbrookpr.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 anemia (IDA) affect about 20 million people in the US 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. The drug 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 anemia. The Company has
launched ACCRUFeR® in the U.S. with an exclusive, multi-year collaboration
agreement with Viatris. Outside of the U.S., the Company has licensed the
rights to four specialty pharmaceutical companies. FeRACCRU® is
commercialized in the UK and European Union by Norgine B.V., 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 commercialization of ACCRUFeR®/ FeRACCRU® in China, Hong
Kong, Macau and Taiwan, with Korea Pharma Co., Ltd. for the Republic of Korea,
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.

 

 

 

 

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