TIDMRENE
RNS Number : 4822D
ReNeuron Group plc
07 July 2016
7 July 2016 AIM: RENE
ReNeuron Group plc
("ReNeuron" or "the Company")
Preliminary Results for the Year Ended 31 March 2016
ReNeuron Group plc (AIM: RENE), a UK-based global leader in the
development of cell-based therapeutics, is pleased to announce its
preliminary results for the year ended 31 March 2016.
Highlights in the period
-- CTX cell therapy candidate for motor disability as a result of stroke:
- Phase II clinical trial - recruitment completed, data expected in Q4 2016
- Pivotal Phase II/III clinical trial planned to commence in H1 2017
-- hRPC cell therapy candidate for retinitis pigmentosa:
- Phase I/II clinical trial underway - ReNeuron's first US clinical study
- Pivotal Phase II/III clinical trial planned to commence in 2018
-- CTX cell therapy candidate for critical limb ischaemia:
- Phase I clinical trial ongoing - data expected in H2 2016
- Phase II clinical trial planned to commence in H1 2017
-- Exosome nanomedicine platform:
- Promising early pre-clinical data in cancer
- Glioblastoma multiforme selected as first clinical target
-- Placing completed in August 2015 to raise GBP68.4 million,
before expenses, funding all therapeutic programmes into mid or
late-stage clinical development
-- Loss for the period of GBP11.35 million (2015: loss of
GBP8.91 million); cash outflow from operations of GBP11.92 million
(2015: outflow of GBP8.25 million); cash, cash equivalents and bank
deposits at 31 March 2016 of GBP65.71 million (2015: GBP12.38
million)
Commenting on the results, Olav Hellebø, ReNeuron's CEO,
said:
"Our last financial year was one of significant progress. During
the period, we commenced our first clinical trial in the US, a
Phase I/II clinical trial of our hRPC cell therapy candidate for
retinitis pigmentosa. We have also made progress with our ongoing
clinical trials in stroke disability and critical limb ischaemia
and we look forward to reporting data from these studies later this
year. We have recently selected brain cancer as the first clinical
target for our exosome nanomedicine platform, based on exciting
pre-clinical data published during the period. Finally, the
substantial GBP68.4 million fundraising completed in the period has
provided us with a very robust balance sheet with which to pursue
the above programmes through to key clinical milestones over the
next two to three years."
Analyst meeting and webcast
A meeting for analysts will be held at 10.00am today at the
offices of Buchanan, 107 Cheapside, London, EC2V 6DN.
For a webcast of the analyst presentation, please log on to the
following web address about 10 minutes before 10.00am:
http://vm.buchanan.uk.com/2016/reneuron070716/registration.htm
For further details please contact Buchanan on 020 7466
5000.
A recording of the presentation will be made available on
ReNeuron's and Buchanan's websites, www.reneuron.com and
www.buchanan.uk.com.
Enquiries:
+44 (0)20 3819
ReNeuron 8400
Olav Hellebø , Chief Executive
Officer
Michael Hunt, Chief Financial
Officer
+44 (0) 20 7466
Buchanan 5000
Mark Court, Sophie Cowles, Stephanie
Watson
Stifel Nicolaus Europe Limited +44 (0) 20 7710
(Nomad and Broker) 7600
Jonathan Senior, Stewart Wallace,
Ben Maddison
About ReNeuron
ReNeuron is a leading, clinical-stage cell therapy development
company. Based in the UK, its primary objective is the development
of novel cell-based therapies targeting areas of significant unmet
or poorly met medical need.
ReNeuron has used its unique stem cell technologies to develop
cell-based therapies for significant disease conditions where the
cells can be readily administered "off-the-shelf" to any eligible
patient without the need for additional immunosuppressive drug
treatments. The Company has therapeutic candidates in clinical
development for motor disability as a result of stroke, for
critical limb ischaemia and for the blindness-causing disease,
retinitis pigmentosa.
ReNeuron is also advancing its proprietary exosome technology
platform as a potential new nanomedicine targeting cancer and as a
potential delivery system for gene therapy treatments.
ReNeuron's shares are traded on the London AIM market under the
symbol RENE.L. Further information on ReNeuron and its products can
be found at www.reneuron.com.
This announcement contains forward-looking statements with
respect to the financial condition, results of operations and
business achievements/performance of ReNeuron and certain of the
plans and objectives of management of ReNeuron with respect
thereto. These statements may generally, but not always, be
identified by the use of words such as "should", "expects",
"estimates", "believes" or similar expressions. This announcement
also contains forward-looking statements attributed to certain
third parties relating to their estimates regarding the growth of
markets and demand for products. By their nature, forward-looking
statements involve risk and uncertainty because they reflect
ReNeuron's current expectations and assumptions as to future events
and circumstances that may not prove accurate. A number of factors
could cause ReNeuron's actual financial condition, results of
operations and business achievements/performance to differ
materially from the estimates made or implied in such
forward-looking statements and, accordingly, reliance should not be
placed on such statements.
Chairman's and Chief Executive Officer's Joint Statement
Review of programmes
We have made considerable progress during the period across our
therapeutic programmes and it underlines the increasing breadth of
the Company's pipeline that we now have two clinical trials in
progress in the UK, a further clinical trial underway in the US and
an exciting early-stage exosome nanomedicine programme targeting
cancer.
CTX for stroke disability
During the period, the clinical team from Glasgow's Southern
General Hospital presented long-term follow-up data from the PISCES
Phase I clinical trial with our CTX stem cell therapy candidate for
motor disability as a result of stroke. There continued to be no
cell-related or immunological adverse events reported in any of the
eleven patients treated in the study out to at least 24 months
post-treatment, with improvements in neurological status and limb
function maintained throughout long-term follow-up compared with
pre-treatment baseline performance.
A UK, multi-site Phase II clinical trial (PISCES II) is ongoing
to examine the efficacy of CTX in patients with motor disability as
a result of ischaemic stroke. Subsequent to the period-end, we
announced that patient recruitment had completed in the PISCES II
study, with three-month follow-up data expected to be available in
the fourth quarter of 2016. We also announced that we had commenced
formal interactions with regulatory authorities in Europe and the
US regarding plans for a randomised, controlled, pivotal Phase
II/III clinical trial with CTX in stroke disability. Subject to the
results of the Phase II study, we expect to file an application in
the first quarter of 2017 to commence a Phase II/III clinical
trial.
Further, we have appointed local representatives to assist
ReNeuron in taking advantage of the recently enacted and favourable
regulatory regime for cell therapy candidates in Japan. These new
Japanese regulations offer the potential for conditional marketing
approval for cell therapies at an earlier stage of clinical
development than in the West. We intend to pursue discussions with
the Japanese regulatory authorities over the coming months, in
order to advance our CTX cell therapy candidate for stroke
disability in Japan under the new regulations.
hRPC for retinitis pigmentosa
During the period under review, we commenced a Phase I/II
clinical trial in the US with our human retinal progenitor cell
(hRPC) therapy candidate for retinitis pigmentosa (RP). RP is a
group of hereditary diseases of the eye that lead to progressive
loss of sight due to cells in the retina becoming damaged and
eventually dying. The FDA has also granted Fast Track designation
to our hRPC programme targeting RP. This designation provides
eligibility for an accelerated approval and priority review process
by the FDA and the Orphan Drug Designation already granted for our
RP programme in both the US and Europe provides the potential for a
significant period of market exclusivity once approved in these
major territories.
The Phase I/II clinical trial in RP patients marks the
initiation of clinical trial activity in the US with our
therapeutic programmes. The study is being conducted at
Massachusetts Eye and Ear Infirmary in Boston, a world-renowned
clinical centre for the treatment of retinal diseases. The trial
design is an open-label, dose escalation study to evaluate the
safety, tolerability and preliminary efficacy of our hRPC stem cell
therapy candidate in fifteen patients with advanced RP.
Initial short-term safety and tolerability data from the Phase I
part of the study in the first nine patients are expected in early
2017. Longer term safety data, as well as efficacy read-outs from
the Phase II part of the study in a further six patients, are
expected in the second half of 2017. Subject to the outcome of the
Phase I/II study, we expect to be able to file an application in
late 2017 or early 2018 to commence a pivotal Phase II/III clinical
trial of hRPC in RP. A positive outcome from this study is expected
to form the basis for subsequent marketing authorisation filings in
both the US and Europe.
CTX for critical limb ischaemia
Our CTX cell therapy candidate for critical limb ischaemia (CLI)
is currently in a Phase I clinical trial in the UK. CLI is a
condition that results in loss of blood flow to the lower limb. The
condition is common in diabetics and can ultimately lead to
amputation. During the past few months, we have prioritised CTX
cell batches towards the PISCES II stroke study in preference to
the CLI safety study. Notwithstanding this prioritisation, we
expect to have safety data available from the CLI study by the end
of this calendar year, sufficient to enable this programme to move
into Phase II clinical development.
Exosome nanomedicine platform
During the period, we continued to advance our exosome
nanomedicine programme. Exosomes are lipid-based nanoparticles
secreted from all cells, which are believed to play a key role in
the transfer of beneficial proteins and particularly non-coding
RNAs from one cell to another. We aim to exploit the therapeutic
potential of exosomes derived from our own proprietary stem cell
lines and we have filed multiple patent applications covering the
composition, manufacture and therapeutic use of our exosome
nanomedicine platform.
ReNeuron researchers have identified a unique mechanism by which
exosomes expressed from CTX cells inhibit the growth and migration
of glioblastoma cells in pre-clinical models of the disease. During
the period, a paper was published in the scientific journal PLOS
ONE describing work undertaken by ReNeuron researchers to identify
a unique set of highly enriched miRNAs contained within CTX-derived
exosomes. The research demonstrated that these miRNAs may have
significant impact in regulating cell growth and apoptosis in
cancer.
Based on the above findings, we recently announced that we had
selected glioblastoma multiforme ("GBM") as the first clinical
target for our selected exosome nanomedicine candidate, designated
ExoPr0. GBM accounts for 16 per cent of all diagnosed brain
cancers. Overall median survival for newly diagnosed disease is 12
to 15 months with 5 year survival rates of 4 to 6 per cent. The
incidence rate in the US and Europe combined is around 25,000
patients per annum.
During the period, we were awarded a GBP2.1 million grant from
Innovate UK for our exosome nanomedicine programme. In
collaboration with the Cell and Gene Therapy Catapult and the
Department of Biochemical Engineering at University College London,
this grant will fund the development of robust manufacturing
systems to enable the production of ExoPr0 at a commercial scale,
as well as product characterisation work and pre-clinical efficacy
and toxicity testing of the ExoPr0 candidate.
Assuming a successful outcome to the above pre-clinical
development programme, we expect to be able to file an application
to commence a first human clinical trial with ExoPr0 in the second
half of 2017.
Other activities
In August 2015, we completed a placing to raise GBP68.4 million,
before expenses. This financing has provided the business with an
extremely robust balance sheet, enabling us to take all of our
current programmes into mid or late-stage clinical development over
the next two to three years.
In February 2016, we relocated our existing business operations
to our new facility in South Wales, with cell production suites
planned to come on-stream at a later date, once qualified for use
and licensed for clinical and commercial manufacture.
Also in February this year, we announced that we had received a
Notice of Allowance from the US Patent and Trademark Office for a
key patent application covering our cell cryopreservation
technology. We have deployed this patented technology to our lead
CTX stem cell line to derive a cryopreserved, long shelf life cell
therapy candidate, designated CTXcryo. We believe that CTXcryo will
provide ReNeuron with significant commercial and competitive
advantages in terms of the availability of a genuine off-the-shelf,
low cost-of-goods cell therapy candidate with a shelf life enabling
shipping to, and storage at, clinical sites on a global basis.
Equivalent patents to the allowed US cryopreservation patent
have already issued in Europe, Japan and Australia. Overall,
ReNeuron owns or has exclusively licensed more than 80 issued
patents, providing protection for our technologies and therapeutic
candidates in key potential markets across the globe.
During the period, we have continued to strengthen the senior
management of the business, at both executive and non-executive
levels. In December 2015, we announced the appointment of Dr
Michael Owen as a Non-executive Director of the Company. Mike
brings a wealth of scientific and commercial biotech and
pharmaceutical experience to the Board and also chairs the
Company's newly established Scientific Advisory Board (SAB). The
inaugural meeting of the SAB took place in December 2015,
comprising nine leading academics and industry executives with a
world-class breadth of expertise across ReNeuron's areas of
operation.
Financial review
Revenues in the year amounted to GBP29k (2015: GBP30k), being
royalties from non-therapeutic licensing activities. Grant income
of GBP0.53 million (2015: GBP0.52 million) was also recognised in
other income.
Research and development costs increased to GBP10.27 million
(2015: GBP7.25 million) and accounted for 72% of net operating
expenses (2015: 66%). The increase during the period was primarily
due to increased clinical trial costs, manufacturing process
development costs and cell manufacturing costs as a result of
increasing clinical trial activity. Pre-clinical research costs
reduced in the period, reflecting the further progression of the
Company's therapeutic programmes into their clinical development
phase.
General and administrative expenses increased to GBP4.02 million
(2015: GBP3.69 million) primarily due to increased staff
recruitment activity and costs associated with the relocation of
the business to South Wales.
The total tax credit for the period was GBP1.49 million,
relating to an accrual for a research and development tax credit
for the period (2015: GBP1.40 million).
As a result of the above, the total comprehensive loss for the
year increased to GBP11.35 million (2015: GBP8.91 million) in line
with both internal and consensus analyst forecasts.
Cash outflow from operating activities was GBP11.92 million
(2015: GBP8.25 million), largely reflecting the operating costs
incurred during the period. Capital expenditure was GBP0.29 million
(2015: GBP0.38 million). As mentioned above, in August 2015, the
Company raised GBP68.4 million, before expenses, by means of a
placing with new and existing institutional investors. As a result,
cash, cash equivalents and bank deposits totalled GBP65.71 million
at the year-end (2015: GBP12.38 million).
Summary and outlook
Our last financial year was one of significant progress. During
the period, we commenced our first clinical trial in the US, a
Phase I/II clinical trial of our hRPC cell therapy candidate for
retinitis pigmentosa. We have also made progress with our ongoing
clinical trials in stroke disability and critical limb ischaemia
and we look forward to reporting data from these studies later this
year. We have recently selected brain cancer as the first clinical
target for our exosome nanomedicine platform, based on exciting
pre-clinical data published during the period. Finally, the
substantial GBP68.4 million fundraising completed in the period has
provided us with a very robust balance sheet with which to pursue
the above programmes through to key clinical milestones over the
next two to three years.
John Berriman Olav Hellebø
Chairman Chief Executive Officer
7 July 2016
Group Statement of Comprehensive Income for the year ended 31
March
2016 2015
GBP'000 GBP'000
------------------------------------- --------- ---------
Revenue: royalty income 29 30
Other income: grants 534 519
Research and development costs (10,272) (7,250)
General and administrative costs (4,015) (3,693)
-------------------------------------- --------- ---------
Operating loss (13,724) (10,394)
Finance income 878 91
-------------------------------------- --------- ---------
Loss before income tax (12,846) (10,303)
Income tax credit 1,492 1,397
-------------------------------------- --------- ---------
Loss and total comprehensive loss
for the year (11,354) (8,906)
-------------------------------------- --------- ---------
Loss and total comprehensive loss
attributable to equity owners of
the Company (11,354) (8,906)
-------------------------------------- --------- ---------
Basic and diluted loss per ordinary
share (0.4p) (0.5p)
-------------------------------------- --------- ---------
Group Statement of Financial Position as at 31 March
2016 2015
GBP'000 GBP'000
-------------------------------- --------- ---------
Assets
Non-current assets
Property, plant and equipment 361 161
Intangible assets 1,591 1,591
Investments - bank deposit 5,000 -
Trade and other receivables 11 281
--------------------------------- --------- ---------
6,963 2,033
-------------------------------- --------- ---------
Current assets
Trade and other receivables 1,421 400
Income tax receivable 2,764 1,272
Investments - bank deposit 43,283 -
Cash and cash equivalents 17,426 12,382
--------------------------------- --------- ---------
64,894 14,054
-------------------------------- --------- ---------
Total assets 71,857 16,087
--------------------------------- --------- ---------
Equity
Equity attributable to owners
of the Company
Share capital 31,646 17,888
Share premium account 97,704 46,267
Capital redemption reserve 8,964 8,964
Merger reserve 2,223 2,223
Accumulated losses (72,879) (62,206)
--------------------------------- --------- ---------
Total equity 67,658 13,136
--------------------------------- --------- ---------
Liabilities
Non-current liabilities
Provisions - 605
Financial liabilities: finance
leases - 1
--------------------------------- --------- ---------
- 606
-------------------------------- --------- ---------
Current liabilities
Trade and other payables 3,700 2,344
Provisions 498 -
Financial liabilities: finance
leases 1 1
--------------------------------- --------- ---------
4,199 2,345
-------------------------------- --------- ---------
Total liabilities 4,199 2,951
--------------------------------- --------- ---------
Total equity and liabilities 71,857 16,087
--------------------------------- --------- ---------
Group Statement of Changes in Equity
Share Capital
Share premium redemption Merger Accumulated Total
capital account reserve reserve losses equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------------ -------- -------- ----------- -------- ------------ ---------
As at 1 April 2014 17,888 46,267 8,964 2,223 (53,625) 21,717
Credit on share-based payment - - - - 325 325
Loss for the year and total comprehensive loss - - - - (8,906) (8,906)
------------------------------------------------ -------- -------- ----------- -------- ------------ ---------
As at 31 March 2015 17,888 46,267 8,964 2,223 (62,206) 13,136
Issue of Ordinary shares 13,758 54,696 - - - 68,454
Costs of share issue - (3,259) - - - (3,259)
Credit on share-based payment - - - - 681 681
Loss for the year and total comprehensive loss - - - - (11,354) (11,354)
------------------------------------------------ -------- -------- ----------- -------- ------------ ---------
As at 31 March 2016 31,646 97,704 8,964 2,223 (72,879) 67,658
------------------------------------------------ -------- -------- ----------- -------- ------------ ---------
Group Statement of Cash Flows for
the year ended 31 March
2016 2015
GBP'000 GBP'000
---------------------------------------- --------- --------
Cash used in operating activities (11,920) (9,124)
Income tax credit received - 879
----------------------------------------- --------- --------
Cash used in operating activities (11,920) (8,245)
Cash flows from investing activities
Capital expenditure (293) (61)
Purchase of intangible asset - (319)
Interest received 345 91
----------------------------------------- --------- --------
Net cash generated/(used) in investing
activities 52 (289)
Cash flows from financing activities
Finance lease principal payments - (1)
Proceeds from issuance of Ordinary 68,454 -
shares
Costs of share issue (3,259) -
Bank deposit (placed)/matured (48,283) 6,000
----------------------------------------- --------- --------
Net cash generated from financing
activities 16,912 5,999
----------------------------------------- --------- --------
Net increase/(decrease) in cash
and cash equivalents 5,044 (2,535)
Cash and cash equivalents at the
start of year 12,382 14,917
----------------------------------------- --------- --------
Cash and cash equivalents at the
end of year 17,426 12,382
----------------------------------------- --------- --------
Notes to the financial information for the year ended 31 March
2016
1. General information
ReNeuron Group plc ("the Company") and its subsidiaries
(together "the Group") are engaged in the research and development
of therapies using stem cells. The Company is a public limited
company incorporated and domiciled in England with registered
number 05474163. Its shares are listed on the Alternative
Investment Market (AIM) of the London Stock Exchange.
2. Basis of preparation
The unaudited financial information included in this preliminary
results announcement for the year ended 31 March 2016 and audited
financial information for the year ended 31 March 2015 does not
comprise statutory accounts within the meaning of section 434 of
the Companies Act 2006. The information has been extracted from the
draft statutory financial statements for the year ended 31 March
2016 which will be delivered to the Registrar of Companies in due
course. Statutory financial statements for the year ended 31 March
2015 were approved by the Board of directors on 24 August 2015 and
have been delivered to the Registrar of Companies. The report of
the auditors on these financial statements was unqualified and did
not include an emphasis of matter paragraph.
The financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRSs) as adopted by
the European Union, the interpretations of International Financial
Reporting Interpretations Committee (IFRIC) and the Companies Act
2006 applicable to companies reporting under IFRS.
Whilst the financial information included in this preliminary
announcement has been prepared in accordance with International
Financial Reporting Standards (IFRS), this announcement does not
contain sufficient information to comply with IFRS. The accounting
policies used in the preparation of these unaudited financial
statements are consistent with those used in the preparation of the
audited financial statements for the year ended 31 March 2015.
3. Going concern
The Group is expected to incur significant further costs as it
continues to develop its therapies and technologies through
clinical development and as it establishes a cell manufacturing
facility in South Wales.
In August 2015, the Company raised GBP68.4 million, before
expenses, by means of a Placing to shareholders. The directors
expect that the Group's financial resources will be sufficient to
support operations for at least the next two years. Consequently,
the going concern basis has been adopted in the preparation of
these financial statements.
4. Research and development costs
All research and development costs incurred in the year have
been charged directly to the Group Statement of Comprehensive
Income.
5. Basic and diluted loss per ordinary share
The basic and diluted loss per share is calculated by dividing
the loss for the financial year of GBP11,354,000 (2015:
GBP8,906,000) by 2,609,315,899 shares (2015: 1,788,827,700 shares),
being the weighted average number of 1p Ordinary shares in issue
during the year.
Potential Ordinary shares are not treated as dilutive as the
entity is loss making.
6. Cash used in operating activities for the year ended 31 March
2016 2015
GBP'000 GBP'000
----------------------------------- --------- ---------
Loss before income tax (12,846) (10,303)
Adjustment for:
Interest received (345) (91)
Depreciation of property,
plant and equipment 92 125
Provisions movement (107) 241
Share-based payment charges 681 325
Changes in working capital
Receivables (751) 270
Payables 1,356 309
Cash used in operating activities (11,920) (9,124)
----------------------------------- --------- ---------
This information is provided by RNS
The company news service from the London Stock Exchange
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July 07, 2016 02:00 ET (06:00 GMT)