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RNS Number : 1285I
Midatech Pharma PLC
31 March 2020
31 March 2020
Midatech Pharma PLC
("Midatech" or the "Company")
Announcement of Strategic Review
Termination of R&D Programme
Update on EU GlioKIDS Grant
Directorate Changes
Midatech Pharma PLC (AIM: MTPH.L; Nasdaq: MTP), an R&D
biotechnology company focused on delivering innovative oncology and
rare disease products to patients announces that, in view of
prevailing conditions in the capital markets and the prospects for
raising additional funds and partnering of assets, the Board of
Midatech is in the process of implementing a strategic review of
its operations.
The Company believes the remaining costs to complete the Phase
III clinical programme of MTD201 (octreotide sustained release) and
manufacturing scale-up at its Bilbao facility are of the order of
$30 million. Of this amount, $8.5 million has been raised in loans
from the Spanish government. The Board has concluded, in the
context of its current cash runway, that the Company is unlikely to
conclude a license transaction or raise sufficient funds to
continue the required remaining investment in MTD201 on a timely
basis. The Board has therefore decided to terminate further inhouse
development of the MTD201 programme with immediate effect. The
Company will continue to seek licensing partners for this
asset.
The Company announced on 5 December 2019 that it has been
provisionally awarded a EUR2.6 million grant under the EU EIC
Accelerator SME Instrument to part fund the GlioKIDS trial of
MTX110 in DIPG, a terminal childhood brain cancer. Because of a
technicality, the EU has not yet confirmed Midatech's status as an
SME, a prerequisite for grant eligibility. The GlioKIDS Phase II
trial of MTX110 may be cancelled if the EU grant is not received.
The Company will continue the exploratory Phase I study of MTX110
with Columbia University announced on 2 March 2020.
In line with the decision to terminate MTD201, the Board has
taken the difficult decision to close the Company's MTD201
dedicated manufacturing facilities in Bilbao and offer redundancy
to all 42 employees. Under Spanish law, the Company will now enter
into a period of consultation with its Bilbao based employees. In
addition, a further five UK-based employees in clinical research
and administrative roles are being offered redundancy.
Following these changes, Midatech's remaining 20 employees and
operations will be concentrated in Cardiff. The Company's near term
goal is to deploy its proprietary drug delivery technologies to
formulate a compelling portfolio of novel first-in-class sustained
release formulations of products with significant commercial
potential for licensing to pharmaceutical company partners at proof
of concept stage. The Company has no plans to undertake additional
trials in humans unless a license partner or grant funding has been
secured.
The Board continues to consider options for extracting value
from the Company's technologies including partnering its existing
and upcoming proof of concept formulations and/or partnering a
technology.
On the basis of the cost-cutting measures described above,
repayment of Spanish government loans, and release of loan
deposits, the Company expects to have a cash runway until early
2021 assuming the GlioKIDS grant is received and the MTX110 Phase
II trial proceeds.
Craig Cook is stepping down as CEO and resigning as a Director
of the Company with immediate effect. He is succeeded by current
CFO Stephen Stamp who will have the combined roles of CEO and CFO
while the Company concludes its strategic review. In addition, in
line with the Company's streamlined strategy and operations and
narrower focus, Dr Huaizheng Peng and Mr Frédéric Duchesne have
resigned as Directors with immediate effect.
Commenting, Rolf Stahel, Chairman said: "On behalf of the Board,
I would like to place on record our sincere thanks to Dr Craig Cook
for his leadership, work and tireless efforts over many years
establishing our leading edge technologies and pipeline in the most
difficult of circumstances, and wish him every success in the
future. We are also fortunate that in Stephen Stamp we have an
internal candidate who can take over responsibility as CEO,
ensuring continuity and a controlled handover. These are
unprecedented times and the decisions we are announcing today
regarding MTD201, our Bilbao manufacturing facility, and staff are
regrettable but also necessary to give Midatech time to find and
deliver a solution for all stakeholders. Unfortunately, recent
events have caused us to re-evaluate our strategy and priorities to
ensure that we can fulfil the potential of our technologies and
pipeline. I must also thank Dr Huaizheng Peng and Mr Frédéric
Duchesne for their counsel and support, particularly over these
past few months."
Dr Cook, outgoing Chief Executive Officer of Midatech Pharma,
said: "I have been with Midatech Pharma for six years and have
enjoyed my time at the company, working with ground breaking
technology, a superb team, and a supportive and very capable Board
of Directors. We have achieved a great deal together in creating
assets as we seek to make a tangible difference for patients
suffering from debilitating and lethal diseases. I leave the
business with a very skilled and strong leader in Stephen Stamp
with an excellent team to support him to deliver value for
shareholders and patients alike. The imminent restructuring of the
business is painful, and which we tried everything to avoid in
these challenging circumstances. The Company would not have
achieved what it has without its employee's dedication and hard
work, and I wish those departing Midatech every success in the
future."
Commenting, Stephen Stamp, incoming CEO and CFO said: "Everybody
connected with the Company believes our three drug delivery
technologies can offer significant improvements in the biodelivery
and biodistribution of pharmaceuticals. We have demonstrated that
in pre-clinical models and in human studies in both MTD201 and
MTX110. Events outside our control have overtaken us and it is
truly regrettable that many gifted and dedicated people have lost
their jobs. For those of us that remain, our focus now is to
extract maximum value for stakeholders from MTX110 and our platform
technologies."
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.
For more information, please contact:
Midatech Pharma PLC
Dr Craig Cook, CEO
Stephen Stamp, CFO
Tel: +44 (0)1235 888300
www.midatechpharma.com
Panmure Gordon (UK) Limited (Nominated Adviser and Broker)
Freddy Crossley, Emma Earl (Corporate Finance)
James Stearns (Corporate Broking)
Tel: +44 (0)20 7886 2500
IFC Advisory Limited (Financial PR and UK Investor Relations)
Tim Metcalfe / Graham Herring
Tel: +44 (0)20 3934 6630
Email: midatech@investor-focus.co.uk
Edison Group (US Investor Relations)
Joseph Green/ Laine Yonker
Tel: (646) 653-7030/ 7035
jgreen@edisongroup.com/ lyonker@edisongroup.com
About Midatech Pharma PLC
Midatech Pharma PLC (dual listed on LSE AIM: MTPH; and NASDAQ:
MTP) is an R&D company focused on 'Making Medicines Better' by
improving delivery of drugs in the body. The Company combines
existing medications with its proprietary and innovative drug
delivery technologies to provide compelling oncology and rare
disease products that have the potential to powerfully impact the
lives of patients undergoing treatment for life threatening
diseases.
The Company has developed three in-house technology platforms,
each with its own unique mechanism to improve delivery of
medications to sites of disease. All of the Company's technologies
have successfully entered human use in the clinic, providing
important validation of the potential for each platform:
-- Q-Sphera(TM) platform: a disruptive micro-technology used for
sustained release to prolong and control the release of
therapeutics over an extended period of time (from weeks to
months).
-- MidaSolve(TM) platform: an innovative nano-technology used to
dissolve insoluble drugs so that they can be administered in liquid
form directly and locally into tumours.
-- MidaCore(TM) platform: a leading edge nano-technology used
for targeting medications to sites of disease.
By improving biodelivery and biodistribution of approved
existing molecules, Midatech's unique R&D has the potential to
make medicines better, lower technical risks, accelerate regulatory
approval and route to market, and provide newly patentable
products. The platform nature of the technologies allows the
potential to develop multiple drug assets rather than being reliant
on a limited number of programmes.
Midatech's headquarters and R&D facility is in Cardiff, UK.
For more information please visit www.midatechpharma.com
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END
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