Preliminary Results
Immupharma PLC
08 May 2008
For immediate release 8 May 2008
ImmuPharma plc
PRELIMINARY RESULTS ANNOUNCEMENT
for the year ended 31 December 2007
ImmuPharma plc (LSE:IMM), ('ImmuPharma' or the 'Company'), the specialist
pharmaceutical discovery and development company is pleased to announce its
preliminary results for the year ended 31 December 2007.
Key Highlights:
• Recruitment of patients well underway with IPP-201101, drug candidate for
the treatment of Systemic Lupus Erythematosus, in pivotal Phase IIb trial
• Added a novel drug candidate to the pipeline, IPP-204106, for cancer;
rights obtained from Centre National de la Recherche Scientifique (CNRS)
• Discovery of a new lead candidate for inflammation, IPP-201007 from
internal proprietary chemical library
• Consolidated cash balance at 31 December 2007 of approx £2.9 million
Dimitri Dimitriou, Chief Executive Officer, said: '2007 was an exciting year
for ImmuPharma with good progress being made through our pipeline, particularly
for our lead drug candidate IPP-201101 for Lupus and the addition of two new
compounds to our portfolio. We look forward to reporting on further progress
throughout 2008 principally the results of our Phase IIb trial for Lupus.'
For further information please contact:
ImmuPharma plc
Dimitri Dimitriou, Chief Executive Officer +44 20 7152 4080
Richard Warr, Chairman +44 20 7152 4080
Dr Robert Zimmer, Chief Scientific Officer +33 389 32 76 50
Buchanan Communications +44 20 7466 5000
Lisa Baderoon, Rebecca Skye-Dietrich
Panmure Gordon & Co +44 151 243 0963
Andrew Burnett
IMMUPHARMA PLC
The consolidated results for ImmuPharma and its subsidiaries (collectively the '
Group') cover the year ended 31 December 2007.
REPORT FROM THE CHAIRMAN AND THE CHIEF EXECUTIVE OFFICER
We are pleased to report our achievements and continued progress during 2007 and
are enthusiastic about our plans for 2008. 2007 has been an important year in
our corporate history. During our second year as a public company we have made
a number of key achievements including the addition of two novel drug candidates
to our portfolio and the continued progress of our most advanced asset in
development, our lead candidate for the treatment of Lupus.
Following the successful completion of a phase II study in patients suffering
from Lupus, where our lead drug candidate (IPP-201101) showed a statistically
significant clinical improvement in patients' overall symptoms, ImmuPharma has
initiated a Phase IIb, double-blind, placebo-controlled trial in 200 patients in
Europe and Latin America. The first patients have been dosed and the Company
expects to report headline efficacy data in summer of 2008. Analysts estimate
that IPP-201101 for the treatment of Lupus has blockbuster sales potential.
ImmuPharma was delighted to announce the addition of two novel drug candidates
to our portfolio during 2007. IPP-204106 is a novel drug candidate for cancer,
the rights to which have been obtained through the Company's ongoing research
collaboration with the Centre National de la Recherche Scientifique (CNRS),
France's leading scientific research institution. The molecule is a nucleolin
antagonist and has a dual mechanism of action, acting both in preventing
angiogenesis as well as proliferation. Preclinical data has shown that
nucleolin antagonists inhibit the growth of tumours and metastasis in many
cancer types.
Following investigation of our proprietary chemical library, ImmuPharma has
discovered a new molecular series with potential application in inflammatory/
allergic conditions such as asthma and rheumatoid arthritis. These molecules,
programme code-named IPP-201007, have utility as selective phospholipase A2
subtype inhibitors and are already patented through ImmuPharma's library broad
patent.
Summary and Outlook
The ImmuPharma business model is to focus on innovative drugs for niche
therapeutic areas with significant sales potential but without the need for a
large commercial infrastructure. In contrast to other types of pharmaceutical
development, this is characterised by relatively streamlined development costs
and timelines. This is evident in our progress so far with IPP-201101 for the
treatment of Lupus.
ImmuPharma is in discussions with a number of pharmaceutical companies regarding
potential licensing deals. The Company intends to optimise the value of its
asset portfolio and to maximise the return to its shareholders.
The focus for the year ahead will be on the current and next phase of trials for
our Lupus compound, IPP-201101; to make progress advancing our other compounds,
particularly our new cancer compound, IPP-204106, and to continue in dialogue
with other pharmaceutical companies in respect of potential corporate deals.
With a strong team in place to execute these objectives, we believe we are well
positioned to take the Group forward.
The Board of ImmuPharma should like to thank its shareholders for their support
as well as its scientific advisors and the Centre Nationale de la Recherche
Scientifique in France for their collaboration.
REPORT FROM THE CHIEF SCIENTIFIC OFFICER
2007 has been a year of exciting progress and new developments for ImmuPharma.
Following the successful Phase II trial in 2006 and further to discussions with
the US Food and Drug Administration (FDA), the first patients have been dosed
with IPP-201101, our lead candidate for the treatment of Lupus, in a pivotal
Phase IIb trial. Two new drug candidates have been discovered. The first one
announced chronologically, IPP-201007, was discovered from our proprietary
chemical library and has potential application in inflammatory/allergic
conditions. The second, IPP-204106, represents an exciting approach to
potentially treating cancer and is a further validation of the value of our
ongoing collaboration with the Centre National de la Recherche Scientifique
(CNRS), France's leading scientific research institution. Furthermore, general
progress on our other pipeline assets continues to be made.
IPP-201101 Lupus Drug Candidate
Following a Phase I study showing IPP-201101 to be generally safe and
well-tolerated and the successful completion of a Phase II study in Lupus
patients which met all of its primary endpoints (p<0.0001) during 2006,
ImmuPharma submitted an IND (Investigational New Drug) application to the US FDA
for the initiation of further pivotal studies for IPP-201101. The feedback
obtained from the FDA enabled ImmuPharma to refine its late-stage development
program for IPP-201101. Specifically, the outcome of this consultation has been
the segmenting of the development program into separate Phase IIb and Phase III
trials. The Company had previously expected a single Phase II/III trial in 240
patients over 12 months. The revised plans allow ImmuPharma to obtain
additional Phase II data earlier than previously expected and continuing with a
more simple Phase III trial in late 2008, broadly in line with previous
development timelines.
Lupus patients are now being dosed with IPP-201101 in the Phase IIb trial for
the treatment of Systemic Lupus Erythematosus and patient recruitment is well
underway. The study is a robust, randomised, placebo-controlled, three-arm dose
ranging study in 200 patients in Europe and Latin America with an additional
three month follow-up. The first efficacy results are expected later this year.
Following the completion of this study, it is expected that the patients will
be rolled into a further study - a one-year 'open label' safety and efficacy
trial, which should report by late 2009, providing further clinical data. In
addition, in late 2008 a similar but pivotal Phase III study is being planned to
commence in an additional 200 patients in the US, Europe and Latin America, to
be treated for a period of six months, subject to our FDA discussions and
approval. In parallel with the Phase IIb trial, ImmuPharma is planning to
complete a long-term pre-clinical toxicology study as part of regulatory
requirements as well as the finalisation of a scale-up manufacturing process
which will allow commercial production.
New Drug Candidate IPP-201007 : Inflammation
Following discovery activities on our proprietary chemical library, ImmuPharma
discovered a new molecular series with potential application in inflammatory/
allergic conditions such as asthma and rheumatoid arthritis. These molecules,
code-named, IPP-201007, have utility as selective phospholipase A2 subtype
inhibitors and are already patented through ImmuPharma's library broad patent.
New Drug Candidate IPP-204106 : Cancer
As part of its successful ongoing research collaboration with the Centre
National de la Recherche Scientifique (CNRS), France's scientific research
institution, ImmuPharma has taken the exclusive rights for the worldwide
development and commercialisation of a novel drug candidate for cancer. The
molecule code-named IPP-204106, has a dual mechanism of action, acting both in
preventing angiogenesis as well as proliferation. IPP-204106 is a nucleolin
antagonist, the lead molecule in a family of pseudopeptides designed to bind to
the surface nucleolin and as a consequence to block the nucleolin activity on a
nuclear basis; the stabilisation of various mRNAs is necessary to induce the
proliferation of certain human cancer cell lines and is nucleolin dependent as
demonstrated in many prestigious peer reviewed publications. By blocking
nucleolin activity we expect to be able to control the cancer cell proliferation
as evidenced in preclinical studies which have shown that nucleolin antagonists
inhibit the growth of tumours and metastasis in many human cancer types as well
as angiogenesis. Furthermore, preliminary data have also shown an absence of
toxicity. Major manufacturing hurdles have also been solved and a large scale
manufacturing is now possible and will be used for the up-coming preclinical and
clinical trials. We now have established a new drug candidate family of
proprietary molecules with a proven potential to treat cancer, with a known
mechanism of action, with demonstrated preclinical activities and an
advantageous safety profile. We expect to initiate a Phase I trial early in
2009.
Whilst our core strategy is to focus our current resources on the progression of
our compounds for Lupus and cancer, we continue to progress our other two
candidates for severe pain and for hospital-acquired infections. Both represent
a breakthrough approach that fits perfectly with the Company's model of niche
diseases in areas where there are clear unmet medical needs.
On behalf of the Board we would like to extend our thanks to the team at the
CNRS in Strasbourg with whom ImmuPharma has key collaborations, to our staff for
their outstanding contribution during 2007 and our shareholders for their
continued support.
FINANCIAL REVIEW
The year ended 31 December 2007 saw the Group continue its controlled
expenditure on the development of its assets. As can be expected of a Group at
this stage of development in the pharmaceutical sector, the Group made a loss
for the period.
Research and development expenditure has risen in line with the Group's activity
in progressing its pipeline.
The Group continues to adopt International Financial Reporting Standards (IFRS)
as its primary accounting basis.
It is important to note that one of these standards, IFRS2, relating to
share-based payments, has had an impact on the results for the Group for this
accounting period. Included in the loss before tax is £40,699 related to new
share options granted during 2007 and £90,916 related to the remaining charge of
share options previously granted. The Group loss before tax is therefore higher
by these two amounts than would have been the case in the normal running of the
Group and research costs. This is purely a notional amount stipulated by IFRS2
(and calculated using a statistical model) as a result of granting the options.
A further £251,693 is due to be charged in subsequent years accounts under
IFRS2, being the remainder of the fair value charge.
Results
The loss of the Group for the year after taxation was £3.1m (prior period loss
£1.9m). Basic and diluted loss per ordinary share was 4.24p (prior period
2.72p). No dividend is proposed.
The expenditure of the Group has been directed towards progressing its pipeline
assets through the clinical process to maximise their potential.
Operating Loss
The Operating loss of £3.5M represents principally the expenditure on
development carried out by Contract Research Organisations and the employment
and running costs of the Group. The timing and extent of the research and
development programme continues to be well controlled.
Net Funds
At 31 December 2007, the Group had cash and cash equivalents of £2.9M (31
December 2006) was £6.5M.
Treasury Policy
The policy continues to be that surplus funds of the Group are held in
interest-bearing bank accounts on short or medium maturities, until commitments
to future expenditure are made.. The Group's Treasury Policy and controls are
straightforward and approved by the Board. The Group does not engage in
speculative transactions.
Financial Strategy
The overall strategy is to maintain tight control over our cash resources whilst
enabling controlled development of the potential product portfolio. The Board
remains alert to opportunities to raise further finance.
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2007
Year ended 1 April
Notes 31 December 2006 to
2007 31 December
2006
£ £
Continuing operations
Revenue 63,199 44,818
Research and development expenses (1,970,654) (568,139)
Administrative expenses (1,620,348) (1,447,998)
Operating loss 2 (3,527,803) (1,971,319)
Finance costs (14,156) (7,739)
Investment revenues 205,911 64,307
Loss before taxation (3,336,048) (1,914,751)
Tax 253,237 54,713
Loss for the year (3,082,811) (1,860,038)
Attributable to:
Equity holders of the parent company (3,082,811) (1,860,038)
Loss per ordinary share
Basic and diluted 3 (4.24)p (2.72)p
CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE
FOR THE YEAR ENDED 31 DECEMBER 2007
Year ended 1 April
31 December 2007 2006 to
31 December 2006
£ £
Exchange differences on translation of foreign operations 115,893 (4,143)
Loss for the financial year (3,082,811) (1,860,038)
Total recognised income and expense for the year (2,966,918) (1,864,181)
Attributable to:
Equity holders of the parent company (2,966,918) (1,864,181)
CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2007
Year ended 1 April
31 December 2006 to
2007 31 December
2006
Notes £ £
Non-current assets
Property, plant and equipment 12,779 11,503
Intangible assets - goodwill - -
Intangible assets - other 755,135 748,878
Total non-current assets 767,914 760,381
Current assets
Trade and other receivables 384,724 103,801
Cash and cash equivalents 2,946,915 6,459,918
Total current assets 3,331,639 6,563,719
Current liabilities
Financial liabilities - borrowings 173,581 192,987
Trade and other payables 441,380 747,615
Provisions 88,774 94,218
Total current liabilities 703,735 1,034,820
Net current assets 2,627,904 5,528,899
Non-current liabilities
Financial liabilities - borrowings 345,475 403,634
Net assets 3,050,343 5,885,646
EQUITY
Ordinary shares 7,277,615 7,277,615
Share premium 3,558,340 3,558,340
Merger reserve 106,148 106,148
Other reserves (466,133) (713,641)
Retained earnings (7,425,627) (4,342,816)
Total equity 4 3,050,343 5,885,646
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2007
Year ended 1 April
31 December 2006 to
2007 31 December
2006
£ £
Cash flows from operating activities
Cash used in operations (3,760,613) (1,236,598)
Interest paid (14,156) (7,739)
Net cash used in operating activities (3,774,769) (1,244,337)
Investing activities
Purchase of property, plant and equipment (7,944) (2,389)
Acquisition of intangibles assets (1,407) -
Interest received 205,911 64,307
Net cash generated from investing 196,560 61,918
activities
Financing activities
Net proceeds from share issue - Company - 2,609,150
(Decrease)/increase in bank overdraft (2,004) 2,556
New loans 93,047 384,754
Loan repayments (168,607) (68,586)
Equity shares to be issued - 2,021,563
Net cash (used in)/generated from financing (77,564) 4,949,437
activities
Effects of exchange rates on cash and cash 142,770 -
equivalents
Net (decrease)/increase in cash and cash (3,513,003) 3,767,018
equivalents
Cash and cash equivalents at beginning of 6,459,918 2,692,900
period
Cash and cash equivalents at end of period 2,946,915 6,459,918
NOTES
1. The financial information set out in this announcement does not comprise
the Group's statutory accounts for the year ended 31 December 2007.
The financial information for the period ended 31 December 2006 is derived from
the statutory accounts for the year which have been delivered to the Registrar
of Companies. The auditors reported on those accounts; their report was
unqualified and did not contain a statement under either Section 237 (2) or
Section 237 (3) of the Companies Act 1985.
The full statutory accounts for the year ended 31 December 2007 will be
finalised on the basis of the financial information presented by the Directors
in this preliminary announcement and will be delivered to the Registrar of
Companies following the Company's Annual General Meeting.
The accounting policies are consistent with those applied in the preparation of
the interim results for the period ended 30 June 2007 which have been prepared
in accordance with International Financial Reporting Standards ('IFRS').
The financial information is for the year ended 31 December 2007 and the
comparatives are for the period from 1 April 2006 to 31 December 2006.
The Group's financial statements incorporate the financial statements of
ImmuPharma plc, ImmuPharma (UK) Limited and other entities controlled by the
company ('the subsidiaries') comprising ImmuPharma AG and ImmuPharma (France)
SA. Control is achieved where the company has the power to govern the financial
and operating policies of an investee entity so as to obtain benefits from its
activities.
2 OPERATING LOSS
-Group Year ended Period ended 31
December 2006
31 December 2007
£ £
Operating loss is stated after charging/(crediting):
Foreign exchange losses/(gains) 13,338 (25,167)
Share based payments charge 131,615 615,134
Employers National Insurance provision in respect of
share based payments charge (5,444) 94,218
Depreciation of property, plant and equipment
- owned 7,330 2,906
Amortisation of intangible assets
- patents 28,982 16,126
Services provided by Company auditors:
- Audit services 41,125 55,538
- Other services (split between):
- Other services relating to taxation 9,812 12,584
- Services relating to share option schemes 16,979 13,630
- All other services 9,136 29,871
Audit services provided by other auditors 8,741 11,860
Included within the audit services figure of £41,125, is £5,875 relating to the period ended 31
December 2006.
3 EARNINGS PER SHARE Year ended 31 Period ended 31
December 2007 December 2006
- Group £ £
Earnings
Earnings for the purposes of basic earnings per
share being net loss attributable to equity
shareholders (3,082,811) (1,860,038)
Number of shares
Weighted average number of ordinary shares for the
purposes of basic earnings per share 72,776,149 68,388,353
Basic and diluted loss per share (4.24)p (2.72)p
The Group has granted share options and warrants in respect of equity shares to be
issued. As a result of the net loss for the year, these options and warrants have no
dilutive effect.
4 STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
Share Share Merger Other Retained Total
capital premium reserve reserves* Earnings equity
£ £ £ £ £ £
At 1 April 2006 6,813,815 1,607,990 106,148 (3,541,195) (2,482,778) 2,503,980
Exchange
differences on
translating
foreign
operations - - - (4,143) - (4,143)
Loss for the
period ended 31
December 2006 - - - - (1,860,038) (1,860,038)
Total
recognised
income and
expense for the
period - - - (4,143) (1,860,038) (1,864,181)
Equity shares
to be issued - - 2,021,563 - 2,021,563
Share based
payments - (195,000) - 810,134 - 615,134
New issue of
equity share
capital 463,800 2,305,200 - - - 2,769,000
Less: expenses
of new share
issue - (159,850) - - - (159,850)
At 31 December 7,277,615 3,558,340 106,148 (713,641) (4,342,816) 5,885,646
2006
Exchange
differences on
translating
foreign
operations - - - 115,893 - 115,893
Loss for the
year ended 31
December 2007 - - - - (3,082,811) (3,082,811)
Total
recognised
income and
expense for the
period - - - 115,893 (3,082,811) (2,966,918)
Share based
payments - - 131,615 - 131,615
At 31 December 7,277,615 3,558,340 106,148 (466,133) (7,425,627) 3,050,343
2007
* Other reserves as at 31 December 2007 comprises a reverse acquisition reserve £(3,541,203) (2006:
£(3,541,203)), a translation reserve £111,758 (2006: £(4,135)) and equity shares to be issued of
£2,963,312 (2006: £2,831,697).
Attributable
to:-
Equity holders 7,277,615 3,558,340 106,148 (466,133) (7,425,627) 3,050,343
of the parent
company
5 DIRECTORS' REPORT AND ACCOUNTS
Copies of the report and accounts will be posted to shareholders in May 2008.
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