Final Results

RNS Number : 2868D

Physiomics PLC

30 November 2009

 



Monday 30 November 2009

Physiomics Plc

("Physiomics" or "the Company")

Final Results for the year ended 30 June 2009

Chairman's Statement

This past year has been a defining one for Physiomics as we announce a maiden net profit despite cutbacks in R&D expenditure by the pharmaceutical industry. Whilst the future is not without its challenges, we believe we are well positioned to take advantage of the opportunities in front of us.

Summary of Results

The efforts of the company have been rewarded by an improvement in our balance sheet, the highlights of which are noted below.

In the year ended 30 June 2009:

• The turnover of the Company increased to £459,550 (2008: £91,221), a creditable five-fold increase. 

• The operating profit was £8,569 (operating loss 2008: £435,440), the Company's maiden profit. 

• At the 30 June 2009 the deficit of shareholders funds was £85,347 - a substantial reduction from the deficit of £354,075 at 30 June 2008

A key element of the improved financial position is the increase in revenue. In addition, the conversion of the loan from EiRx Pharma Limited (in members' voluntary liquidation) into ordinary shares not only removed a liability but substantially reduced our gearing with the consequent impact on the balance sheet.

Out-Licensing - ModelPlayer™

The continuing confidence shown in Physiomics by Eli Lilly is, we believe, testament to the value of our technology platform - modelling drug/target interactions. The development of a ModelPlayer™ customised to deliver data on specific targets of interest has been an important driver in forming new relationships within the industry. We are now in discussion with other leading pharmaceutical companies on a number of possible projects. This new feature now forms part of Physiomics' core competences, which could generate recurring licence fees for the use of our software.

Chronotherapy

We believe that the European TEMPO project has validated another of our models to determine an optimal dosing regimen for both newly developed and established cancer drugs. Designed to improve treatment outcomes, the project has been exploring chronotherapy, an approach to drug dosing regimens, to determine the optimal time i.e. when during the day a drug can provide more therapeutic effect; the model also has the potential to lower treatment side effects by reducing the size and/or frequency of dosing. The optimal time varies from patient to patient as it is related to an individual's circadian (body) clock. An additional potential benefit is that the capability of establishing an optimal dosing regime can now also be offered by Physiomics to pharmaceutical companies as part of their drug development package.

Combination therapies in oncology

Oncology treatment frequently involves the administration of a cocktail of drugs, each targeted to interrupt a specific step of a cancer cell's growth process, with the expectation that this would lead to cancer cell death. Anti-cancer drugs will usually damage the infrastructure of a cell and this leads to cell death by one or more mechanisms. However, cells are programmed to repair some forms of damage and researchers have discovered that certain proteins can promote this repair. The consequence is clear, if the damage caused by the anti-cancer drug is repaired or much reduced the cancer cells may still survive and propagate. 

A number of new drug treatments are emerging which are designed to work synergistically with existing drugs, the combination being used to block the cancer cell's repair mechanism whilst the original drug continues to damage the cancer cell. Inhibitors of CHK1 protein kinase are good examples of these new drugs. However, before they can be utilised it needs to be determined how much of each drug should be administered; which drug should be given first or whether they should be administered at the same time; and whether there is to be an interval between administration of each drug. The Physiomics SystemCell® technology has been adapted to complement existing research tools in addressing these unknowns. Through our collaboration with the University of Swansea, Physiomics can simulate thousands of scenarios using a supercomputer, to test various permutations and identify some optimised options which can then be tested in in vivo model systems. This reduces the need to use animal models, reduces cost and importantly, reduces the time to reach the clinical phase of the development programme for the sponsor company. It could also be used to support a company's application to regulatory bodies for drug approval. The Food and Drug Administration in the USA and the European Medicines Evaluation Agency have indicated that they would welcome reasoned and rational model-based predictions as the basis for in vivo experimentation, which could validate a dosage recommendation as the basis of a clinical research programme.  

Physiomics is currently validating its modelling as a valuable addition to the research armamentarium used by drug discovery companies in the drug candidate selection process.

Conclusion

To conclude, in a time of financial difficulties and cutbacks in corporate spending, the Company's response has been to develop and exploit our SystemCell® modelling platform to provide new functionality. Some of our developments have emerged as a consequence of working with sponsor companies, from novel concepts like TEMPO and chronotherapy, whilst others have resulted from the application of a skilled team of modelling experts matching what their art can deliver to what we believe the drug discovery companies require giving them a significant edge on their competitors. The Directors believe that these important technical achievements will provide the Company with a valuable springboard towards integrating our technology with that of drug discovery companies in the oncology field, turning a "nice to have" proposition into a "must have" proposition.

As Chairman of the Company, I never cease to be amazed at the apparent ease with which a small but dedicated team of very special individuals is able to combine the disciplines of advanced mathematics, physics and software engineering, with an in depth grasp of the biology and biochemistry of cancer and a detailed knowledge of the biology of cancer in a human cell. They have created a unique platform and from it a range of new functionality which has the ability to open doors that until recently, we were not sure existed. I and my fellow Board members congratulate them on what has been an exemplary year of endeavour and achievement.

Outlook

The Company has worked hard this past year to build a strong technical platform and a more robust balance sheet. The new functionality that we are offering to client companies should provide a strong basis for the business to grow and firmly occupy the modelling space in oncology research and development. The key now will be to convert this potential into more value-added contracted business. To this end, we have increased our business development resource and evolved our commercial strategy to amplify the benefits of working with the Physiomics scientific team.

Whilst it is difficult to cite any one event in evidence, the business environment does not appear to be deteriorating further and there may even be some signs of activity in our sector. We have been cautious about our forecasts for the coming year since whilst we are in discussion with a number of pharmaceutical companies the timing of outcomes is still too difficult to assess. We have a number of valuable new features and functionality in our offering to sponsor companies. We believe that these will prove to be attractive and that there will be demand but that this will come on the back of more validation data and pilot activities with clients to match what we can deliver to what they believe that they need. 

We believe that the new financial year is likely to be similar overall to the year just ended as we create momentum in delivery of new services and open up new opportunities. This should lead to business opportunities with new client companies, through providing a broader range of competences and revenue generating opportunities. 

Dr Paul Harper	Dr Christophe Chassagnole
Non-Executive Chairman	Chief Operating Officer

  Income Statement for the year ended 30 June 2009 

			Year ended		Year ended
			30-Jun-09		30-Jun-08
			£		£
Revenue			459,550		91,221
Net operating expenses			(450,981)		(526,661)
Operating profit (loss)			8,569		(435,440)
Finance income			67		347
Finance costs			(4,021)		(9,376)
Profit (loss) before taxation			4,615		(444,469)
UK corporation tax			19,969		10,000
Profit (loss) for the year attributable to equity shareholders			24,584		(434,469)
Profit (loss) per share (pence) Basic and diluted			0.005	p	(0.116)	p

Balance Sheet as at 30 June 2009

			Year ended		Year ended
			30-Jun-09		30-Jun-08
			£		£
Non-current assets
Intangible assets			34,932		39,764
Property, plant and equipment			2,142		3,779
Investments			1		1
			37,075		43,544
Current assets
Trade and other receivables			143,402		61,935
Cash and cash equivalents			95,080		8,716
			238,482		70,651
Total assets			275,557		114,195
Current liabilities
Trade and other payables			(203,996)		(310,270)
Loans			(63,500)		(8,000)
Deferred income			(93,408)		-
			(360,904)		(318,270)
Non-current liabilities
Other payables			-		(150,000)
Total liabilities			(360,904)		(468,270)
Net assets			(85,347)		(354,075)
Capital and reserves
Share capital			249,856		149,989
Capital reserves			1,755,713		1,611,436
Retained earnings			(2,090,916)		(2,115,500)
Equity shareholders' funds			(85,347)		(354,075)

  Statement of changes in equity for the year ended 30 June 2009

		Share			Total
	Share	premium	Other	Retained	shareholders'
	capital	account	reserves	earnings	funds
	£	£	£	£	£
At 30 June 2007	149,989	1,611,436	18,381	(1,681,031)	98,775
Loss for the year	-	-	-	(434,469)	(434,469)
Equity element of loan notes	-	-	(18,381)	-	(18,381)
At 30 June 2008	149,989	1,611,436	-	(2,115,500)	(354,075)
Share issue (net of costs) Profit for the year	99,867 -	144,277 -	- -	- 24,584	244,144 24,584
At 30 June 2009	249,856	1,755,713	-	(2,090,916)	(85,347)

  Cash Flow Statement for the year ended 30 June 2009

			Year ended		Year ended
			30-Jun-09		30-Jun-08
			£		£
Cash flows from operating activities:
Operating profit (loss)			8,569		(435,440)
Amortisation and depreciation			7,049		11,318
(Increase) decrease in receivables			(68,998)		62,978
Increase (decrease) in payables			(14,071)		178,984
Increase in deferred income			93,408		-
Cash generated from operations			25,957		(182,160)
UK corporation tax received			-		58,922
Interest paid			-		-
Net cash generated from operating activities			25,957		(123,238)
Cash flows from investing activities:
Interest received			67		347
Purchase of non-current assets, net of grants received			(580)		(1,216)
Net cash used by investing activities			(513)		(869)
Cash inflow (outflow) before financing			25,444		(124,107)
Cash flows from financing activities:
Receipt of loans			30,000		8,000
Issue of ordinary share capital (net of expenses)			30,920		-
Receipt from related parties			-		50,000
Net cash from financing activities			60,920		58,000
Net increase (decrease) in cash and cash equivalents			86,364		(66,107)
Cash and cash equivalents at beginning of year			8,716		74,823
Cash and cash equivalents at end of year			95,080		8,716

Earnings per Share

The calculations of loss per share are based on the following losses and numbers of shares.

	2009	2008
	£	£
Profit (loss) on ordinary activities after tax	24,625	(434,469)
	=============	=============
	No.	No.
Weighted average no of shares:
For basic profit per share (2008: basic and diluted loss per share )	512,460,174	374,972,639
For diluted profit per share	540,799,685	-
	=================	=================
Basic and diluted profit (loss) per share	0.005p	(0.116p)
	=========	===========

Notes

1. Extract from Annual Report and Accounts

The financial information set out above does not constitute statutory accounts within the meaning of the Companies Act 2006.

2. Basis of preparation

Physiomics Plc has adopted International Financial Reporting Standards ("IFRS"), IFRIC interpretations and the Companies Act 2006 as applicable to companies reporting under IFRS. 

3. Report Distribution

Copies of the annual report will be sent to shareholders on Friday 4 December 2009 and will be available for a period of one month to the public at the offices of Physiomics Plc, The Magdalen Centre, Robert Robinson Avenue, Oxford Science Park, Oxford, OX4 4GA, and at the Company's website www.physiomics-plc.co.uk

4. Annual General Meeting

The Annual General Meeting of the Company will be held at the offices of Bircham Dyson Bell, 50 Broadway, London, SW1H 0BL at 10.00 am on Tuesday 29 December 2009. 

Contacts:

Physiomics Plc

Dr Christophe Chassagnole, Chief Operating Officer, [phone]

WH Ireland Limited

Katy Mitchell, [phone]

 

END

 

 

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