REG - ValiRx PLC - Half-year Report
24/08/2023 07:00
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RNS Number : 2736K ValiRx PLC 24 August 2023
VALIRX PLC
("ValiRx", "the Company" or "the Group")
HALF YEARLY REPORT FOR THE PERIOD ENDED 30 JUNE 2023
London, UK., 2023: ValiRx Plc (AIM: VAL), a life science company, focussing on
early-stage cancer therapeutics and women's health, , today announces its Half
Yearly Report for the period ended 30 June 2023 and provides an update on
significant post-period events.
HIGHLIGHTS
Operational
· Launch of wholly owned subsidiary, Inaphaea BioLabs Limited
("Inaphaea"), with post-period event of first external sales
· Acquisition of scientific assets of Imagen Therapeutics Limited
("Imagen Therapeutics")
· Signature of collaboration service agreements for Inaphaea with
Physiomics PLC ("Physiomics"), OncoBone Limited ("OncoBone"), and post-period
with Agility Life Sciences Limited ("Agility")
· Expansion of evaluation agreement with the University of
Barcelona to enable study of a second KRAS project and to establish standard
terms for future agreements
Financial
· Research and developments costs £207,721 (2022: £200,531)
· Administrative expenses £925,866 (2022: £611,370)
· Share-based payment charge £17,733 (2022: £261,052)
· Total comprehensive loss for the period of £1,035,424 (2022:
£992,481)
· Loss before income taxation of £1,152,325 (2022: £1,074,784)
· Expenditure in H1 includes one-off costs associated with the
set-up of Inaphaea and acquisition of Imagen assets
· Loss per share from continuing operations of 1.03p (2022: Loss
1.53p)
· Cash and cash equivalents at 30 June 2023 of £891,246 (2022:
£97,699)
· Post period receipt of the FY22 R&D tax credits of £192,671
(2021: £133,413)
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 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018 ("UK MAR"). The Directors of the Company
take responsibility for this announcement.
*** ENDS ***
For more information, please contact:
ValiRx plc Tel: +44 (0) 2476 796496
www.valirx.com (http://www.valirx.com)
Dr S J Dilly suzanne.dilly@valirx.com
Cairn Financial Advisers LLP (Nominated Adviser) Tel: +44 (0) 20 7213 0880
Liam Murray / Jo Turner / Ludovico Lazzaretti
Cenkos Securities Limited (Joint Broker) Tel: +44 (0) 20 7397 8900
Dale Bellis / Michael Johnson (Sales)
Callum Davidson / Giles Balleny (Corporate Finance)
Turner Pope Investments (TPI) Limited (Joint Broker) Tel: +44 (0) 20 3657 0050
James Pope / Andy Thacker
Notes for Editors
About ValiRx
ValiRx PLC accelerates the development of innovative medicines that enhance
patient experience. We do this by combining intellectual and financial
resources to select, progress and partner a balanced portfolio of
risk-reduced, early-stage technologies for translation into clinical
candidates.
The Company listed on the AIM Market of the London Stock Exchange in October
2006 and trades under the ticker symbol: VAL.
CHAIRMAN'S STATEMENT FOR THE HALF YEAR ENDED 30 JUNE 2023
Having shifted the tCRO® strategy towards a build-and-buy approach in the
latter part of 2022, the primary activity in the first half of 2023 has been
to establish in-house, cell-based testing capabilities to support both our
collaborative development pipeline and generate income through third-party
business.
The outcome of this has been the launch of a wholly owned subsidiary,
Inaphaea, which has been set up and become operational at a fraction of the
cost of acquiring a company with existing infrastructure. The business is
already developing a strong pipeline of potential customers and successfully
completed its first deal quickly after launch, a testament to the hard work of
all those involved in the lab set up, business development and operations.
The launch of Inaphaea and subsequent successful acquisition of the scientific
assets of Imagen Therapeutics was made possible through the funds raised in
2022 and the placing and broker offer in January 2023.
Following its launch, Inaphaea has continued to build the tCRO® concept by
developing collaborations with companies that provide complementary
capabilities, such as Physiomics, Oncobone and, more recently, Agility Life
Sciences. Their services, when aligned with the cell-based testing of
Inaphaea, present a very compelling service offering to companies seeking to
translate preclinical assets into clinical candidates, including ValiRx's own
development pipeline.
The ValiRx R&D team are continuing to build a risk-balanced portfolio of
novel science in oncology and women's health, with a number of potential
candidates in late-stage discussions. Building and funding a strong portfolio
of evaluation projects also means that not all the science will meet our
rigorous selection criteria, as evidenced by the conclusion of the Hokkaido
project as announced on 16 June 2023. The benefit of such decisions is that
funds can be re-directed towards projects that may have a greater chance of
success and value creation for shareholders, such as the expansion of the
Barcelona evaluation agreement to investigate new drug candidates in oncology,
as announced on 7 June 2023.
The continued progress of ValiRx during the first half of 2023 has been
encouraging. However, this has been against the backdrop of challenging market
conditions, with the biotechnology sector in general suffering from a change
in sentiment in a post-Covid world. Although there are expectations of
additional income from Inaphaea, the Company will be managing its resources in
the most efficient manner to maintain momentum over the next period.
Kevin Cox
Chairman
24 August 2023
CHIEF EXECUTIVE OFFICER'S STATEMENT FOR THE HALF YEAR ENDED 30 JUNE 2023
The key event for ValiRx in the first half of 2023 was the launch of our
service-providing subsidiary, Inaphaea. A wholly owned subsidiary, Inaphaea
is intended to be central to our designs for a translational Contract Research
Organisation (tCRO®) offering capabilities to the ValiRx internal pipeline
projects as well as to third party, fee-for-service clients.
Initially offering a cell-based assay capability, Inaphaea's intention is to
incorporate and validate a suite of in vitro and in silico testing
technologies to enhance the central ethos of building strong preclinical
evidence to de-risk the later stages of drug development. Focussing on
reproducibility, translatability (suitability for later and clinical stages of
development), and humanisation of preclinical science, Inaphaea's tCRO®
offering is intended to occupy a high value segment of the market.
In June 2023, the establishment of Inaphaea's initial service offering was
substantially accelerated by the acquisition of the scientific assets of
Imagen Therapeutics. These assets included several high specification items
of equipment, providing Inaphaea with capabilities around partial automation
and live imaging during cell-based assays. Additionally, a biobank of
patient derived cancer cells, consisting of over 500 unique samples was
included, enabling Inaphaea to take the first step towards improving
humanisation and relevance of the cell-based assays on offer. Soon after,
the first external customer was signed up, with an initial multi-stage,
defined project taking place between July and September.
In order to build out the service offering within Inaphaea, several
collaboration agreements have already been set up, with others currently
proposed and under negotiation. This includes the collaboration with
Physiomics to offer biological modelling and advanced data analysis; with
Agility to offer pre-formulation and formulation assessments and with OncoBone
to enable Inaphaea to be incorporated into their virtual CRO offering.
Inaphaea has also successfully listed on the Scientist.com database to
increase visibility to a larger field of potential clients.
Throughout this period work has also continued to advance the ValiRx internal
pipeline of research, with current projects progressing to expected
milestones, and new projects sought. These are detailed individually below.
Evaluation Projects:
Hokkaido University
The project under Evaluation from Hokkaido University completed its evaluation
period in June 2023. The data did not support the launch of the full
in-licensing process for this project at this time, so we returned all the
data to the originating academics along with our suggestions for their further
development. We intend to maintain a relationship with the University to
assess other programmes, or to re-assess this programme in the future.
Barcelona University
On completion of the evaluation programme from the University of Barcelona, we
were delighted to share the news that the University has been awarded further
funding to develop the project in their own group. Barcelona University has
a number of research groups working on areas of interest to ValiRx, and we
have agreed an over-arching agreement that states standard terms on which we
can commence evaluations on subsequent projects; with the first of these being
a further KRAS project. KRAS(2) consists of a lead series of molecules that
bind to a different proposed binding domain of KRAS, with our evaluation
considering the activity of a selection of molecules from the lead series.
Further Evaluation Projects
With an ambition to secure 3-4 new evaluation projects every year, we have
been focussing substantial effort on identifying and qualifying further assets
that meet our criteria to build a diversified preclinical project pipeline.
Clinical Stage Assets
VAL201 remains subject to the Letter of Intent ("LoI") with TheoremRx Inc, and
we maintain good lines of communications with the TheoremRx team to ensure
that they are focussed on securing the financing which will enable the VAL201
sub-license to complete.
In June 2023, we announced the carve-out of the Greater China region from the
exclusivity clause in the TheoremRx letter of intent. This enables us to
re-commence active marketing of the project in this region in order to explore
additional lines of revenue.
VAL401 is subject to an intensive business development programme with an
external provider of partnering services who are exploring options around
partners focussed on oncology and supportive care.
Preclinical Stage Assets
CLX001 was placed in the single asset subsidiary company, Cytolytix Limited
("Cytolytix") in Q4 2022, and has undergone a programme of formulation
development during the first half of 2023. The peptide active ingredient
requires a nanoformulation to ensure that the peptide is delivered to cancer
cells at appropriate levels and to stabilise the active ingredient within the
therapeutic agent with the lead formulation now proposed and undergoing
testing in the Inaphaea facility.
Once the lead formulation has been confirmed as being biologically active, a
full programme of preclinical development including manufacturing, toxicology,
disease impact and regulatory activities will be pursued.
Opportunities for early partnering are being explored for Cytolytix, with
active commercial development to promote the project to potential industry
partners.
VAL301 in vitro preclinical optimisation is ongoing within the Inaphaea tCRO®
facility, with variations of the molecule being studied for impact on growth
rates of estrogen dependent cells under a variety of stimulatory conditions.
These assays will determine whether an alternative molecular structure can
improve the potential for disease modifying impact for endometriosis, as well
as offering the potential for new patent filings to refresh the intellectual
property portfolio surrounding the project.
BC201 remains in assessment in the collaboration between Black Cat Bio Limited
and Oncolytika, with preclinical assessments considering the impact of the
active ingredient against viral infections and immune responses.
Dr S J Dilly
CEO
24 August 2023
ValiRx Plc
Consolidated statement of comprehensive income
Six months ended Six months ended Year ended
Note 30 June 30 June 31 December
2023 2022 2022
(unaudited) (unaudited) (audited)
£ £ £
Continuing operations
Research and development (207,721) (200,531) (551,233)
Administrative expenses (925,866) (611,370) (1,502,355)
Share-based payment charge (17,733) (261,052) (539,791)
Operating loss (1,151,320) (1,072,953) (2,593,379)
Finance costs (1,005) (1,831) (5,456)
Loss before income taxation (1,152,325) (1,074,784) (2,598,835)
Income tax credit 2 90,000 70,000 192,671
Loss on ordinary activities after taxation (1,062,325) (1,004,784) (2,406,164)
Non-controlling interests 26,901 12,303 39,676
Loss for the period and total comprehensive income attributable to owners of (1,035,424) (992,481) (2,366,488)
the parent
Loss per share - basic and diluted
From continuing operations 3 (1.03)p (1.53)p (3.06)p
ValiRx Plc
Consolidated statement of financial position
As at 30 June 31 December
2023 2022 2022
(unaudited) (unaudited) (audited)
£ £ £
ASSETS
NON-CURRENT ASSETS
Goodwill 1,602,522 1,602,522 1,602,522
Intangible assets 818,097 1,007,770 903,900
Property, plant and equipment 274,744 - -
Right-of-use assets 1,702 9,278 5,561
2,697,065 2,619,570 2,511,983
CURRENT ASSETS
Trade and other receivables 201,368 79,291 133,815
Tax receivable 282,671 203,413 192,671
Cash and cash equivalents 891,246 97,699 1,137,477
1,375,285 380,403 1,463,963
TOTAL ASSETS 4,072,350 2,999,973 3,975,946
SHAREHOLDERS' EQUITY
Share capital 9,707,266 9,669,995 9,695,120
Share premium account 27,873,048 24,519,456 26,772,630
Merger reserve 637,500 637,500 637,500
Reverse acquisition reserve 602,413 602,413 602,413
Share-based payment reserve 1,062,960 723,433 986,816
Retained earnings (35,679,063) (33,284,988) (34,643,639)
4,204,124 2,867,809 4,050,840
Non-controlling interest (251,440) (197,170) (224,539)
TOTAL EQUITY 3,952,684 2,670,639 3,826,301
LIABILITIES
NON-CURRENT LIABILITIES
Borrowings 16,818 28,056 22,070
Lease liabilities - 2,486 -
16,818 30,542 22,070
CURRENT LIABILITIES
Trade and other payables 90,830 281,955 111,933
Borrowings 10,264 9,747 9,962
Lease liabilities 1,754 7,090 5,680
102,848 298,792 127,575
TOTAL LIABILITIES 119,666 329,334 149,645
TOTAL EQUITY AND LIABILITIES 4,072,350 2,999,973 3,975,946
ValiRx Plc
Consolidated statement of changes in shareholders' equity
Share capital Share premium Retained earnings Merger reserve Share-based payment reserve Reverse acquisition reserve Non-controlling interest Total
£ £ £ £ £ £ £ £
Unaudited
Balance at 1 January 2023 9,695,120 26,772,630 (34,643,639) 637,500 986,816 602,413 (224,539) 3,826,301
Loss for the period - - (1,035,424) - - - (26,901) (1,062,325)
Issue of shares 12,146 1,287,854 - - - - - 1,300,000
Costs of shares issued - (129,025) - - - - - (129,025)
Share-based payment movement - (58,411) - - 76,144 - - 17,733
Balance at 30 June 2023 9,707,266 27,873,048 (35,679,063) 637,500 1,062,960 602,413 (251,440) 3,952,684
Unaudited
Balance at 1 January 2022 9,669,995 24,490,618 (32,292,507) 637,500 491,219 602,413 (184,867) 3,414,371
Loss for the period - - (992,481) - - - (12,303) (1,004,784)
Lapse of share options and warrants - 28,838 - - (28,838) - - -
Share-based payment movement - - - - 261,052 - - 261,052
Balance at 30 June 2022 9,669,995 24,519,456 (33,284,988) 637,500 723,433 602,413 (197,170) 2,670,639
Audited
Balance at 1 January 2022 9,669,995 24,490,618 (32,292,507) 637,500 491,219 602,413 (184,867) 3,414,371
Loss for the year - - (2,366,488) - - - (39,676) (2,406,164)
Issue of shares 25,125 2,462,250 - - - - - 2,487,375
Costs of shares issued - (209,076) - - - - - (209,076)
Lapse of share options and warrants - 28,838 15,356 - (44,194) - - -
Movement in year - - - - 539,791 - 4 539,795
Balance at 31 December 2022 9,695,120 26,772,630 (34,643,639) 637,500 986,816 602,413 (224,539) 3,826,301
ValiRx Plc
Consolidated cash flow statement
Year ended
Six months ended 30 June 31 December
2023 2022 2022
(unaudited) (unaudited) (audited)
£ £ £
Cash flows from operating activities
Operating loss (1,151,320) (1,072,953) (2,593,379)
Depreciation of property plant and equipment 13,558 - -
Amortisation of intangible fixed assets 100,803 102,850 204,216
Depreciation of right-of-use assets 3,859 4,000 7,717
(Increase) in receivables (67,552) (6,366) (60,886)
(Decrease)/increase in payables within one year (21,103) 231,120 61,098
Share-based payment charge 17,733 261,052 539,791
Net cash outflows from operations (1,104,022) (480,297) (1,841,443)
Tax credit received - - 133,413
Interest paid (432) (1,702) (4,215)
Net cash outflow from operating activities (1,104,454) (481,999) (1,712,245)
Cash flows from investing activities
Purchase of intangible fixed assets (15,000) (2,504) -
Purchase of property plant and equipment (288,302) - -
Net cash outflow from investing activities (303,302) (2,504) -
Cash flows from financing activities
Share issue 1,300,000 - 2,487,375
Costs of shares issued (129,025) - (209,076)
Repayment of lease liabilities (4,500) (4,500) (9,000)
Bank loan (4,950) (6,970) (13,249)
Net cash generated from/(used in) financing activities 1,161,525 (11,470) 2,256,050
Net (decrease)/increase in cash and cash equivalents (246,231) (495,973) 543,805
Cash and cash equivalents at start of period 1,137,477 593,672 593,672
Cash and cash equivalents at end of period 891,246 97,699 1,137,477
ValiRx Plc
Notes to the interim financial statements
1 General information
Valirx Plc is a company incorporated in the United Kingdom, which is listed on
the Alternative Investment Market of the London Stock Exchange Group Plc. The
address of its registered office is Stonebridge House, Chelmsford Road,
Hatfield Heath, Essex CM22 7BD.
Financial information
The interim financial information for the six months ended 30 June 2023 and
2022 have not been audited or reviewed and do not constitute statutory
accounts within the meaning of Section 434 of the Companies Act 2006. The
comparative financial information for the year ended 31 December 2022 has been
derived from the audited financial statements for that period. A copy of those
statutory financial statements for the year ended 31 December 2022 has been
delivered to the Registrar of Companies. The report of the independent
auditors on those financial statements was unqualified, drew attention to a
material uncertainty relating to going concern and did not contain a statement
under Sections 498 (2) or (3) of the Companies Act 2006.
The interim financial statements have been prepared in accordance with
International Accounting Standards in conformity with the requirements of the
Companies Act 2006 as they apply to the financial statements of the Company
for the six months ended 30 June 2023 and as applied in accordance with the
provisions of the Companies Act 2006 and under the historical cost convention
or fair value where appropriate. They have also been prepared on a basis
consistent with the accounting policies expected to be applied for the year
ending 31 December 2023 and which are also consistent with those set out in
the statutory accounts of the Group for the year ended 31 December 2022.
The interim consolidated financial statements are presented in pounds sterling
which is the currency of the primary economic environment in which the Group
operates.
2 Taxation
Six months ended Six months ended Year ended
30 June 30 June 31 December
2023 2022 2022
(unaudited) (unaudited) (audited)
£ £ £
United Kingdom corporation tax at 25% (2022: 19%)
Current period - R & D Tax credit (90,000) (70,000) (192,671)
Income tax credit (90,000) (70,000) (192,671)
3 Loss per ordinary share
The loss and number of shares used in the calculation of loss per share are as
follows:
Six months ended Six months ended Year ended
30 June 30 June 31 December
2023 2022 2022
(unaudited) (unaudited) (audited)
Basic: £ £ £
Loss for the financial period (1,062,325) (1,004,784) (2,406,164)
Non-controlling interest 26,901 12,303 39,676
(1,035,424) (992,481) (2,366,488)
Weighted average number of shares 100,808,008 65,049,156 77,301,896
Loss per share (1.03)p (1.53)p (3.06)p
The loss and the weighted average number of shares used for calculating the
diluted loss per share are identical to those for the basic loss per share.
The exercise prices of the outstanding share options and share warrants are
above the average market price of the shares and would therefore not be
dilutive under IAS 33 'Earnings per Share.
4 Dividends
The Directors do not propose to declare a dividend in respect of the period.
5 Copies of interim results
Copies of the interim results can be obtained from the website www.valirx.com
(http://www.valirx.com) . From this site you may access our financial reports
and presentations, recent press releases and details about the Company and its
operations.
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.
Such statements are based on current expectations and assumptions and are
subject to a number of risks and uncertainties that could cause actual events
or results to differ materially from any expected future events or results
expressed or implied in these forward-looking statements. Persons receiving
and reading this announcement should not place undue reliance on
forward-looking statements. Unless otherwise required by applicable law,
regulation or accounting standard, the Company does not undertake to update or
revise any forward-looking statements, whether as a result of new information,
future developments or otherwise.
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