Pre-close update

RNS Number : 9284D

Provexis PLC

31 March 2011

 



Provexis PLC

Pre-close update

Provexis plc (PXS.L) ("Provexis" or the "Company"), which focuses on the discovery, development and licensing of scientifically-proven functional food, medical food and dietary supplement technologies announces a pre-close update for the year ended 31 March 2011.

In its preliminary results statement expected in early June, the Company expects to report on a year of good progress in commercialising and developing its pipeline of functional food, medical food and dietary supplement technologies. The Company continues to seek acquisitions to support its strategy of becoming a leading company in the sector.

Fruitflow^®

The Company announced on 1 June 2010 that it had entered into a long-term alliance with DSM Nutritional Products ("DSM") to develop Fruitflow® in all major global markets, through an effective commercialisation of current formats and pioneering new and significant applications (the "Alliance").

DSM launched Fruitflow® to the industry in Europe in November 2010 and in the US in March 2011. Concurrently, with these industry launches, DSM has made significant progress in marketing the technology in a broad range of global markets, attracting positive interest from a wide range of global, multinational and national brand owners in the functional food and dietary supplement sectors.

Fruitflow® has been recognised in the industry for its strong science and innovation, being awarded the 'Most Innovative Health Ingredient' and winning the best innovation in the 'Heart Health' category at the major Health Ingredients Europe Conference in November 2010. In March 2011 the technology was awarded 'Best New Ingredient' at the 2011 NutrAwards held at the Nutracon 2011 exhibition in Anaheim, California.

The Board of Directors (the "Board") is pleased to confirm that it has been informed by DSM that they have secured a manufacturing platform and supply chain for Fruitflow® syrup, which is suitable for beverages and dairy formats. In addition a manufacturing process for Fruitflow® powder for use in the dietary supplement sector has been developed and optimised and this important format is expected to be launched to the industry in the late summer.

Development Pipeline

The Company continues to progress its development pipeline through its R&D teams at the Rowett Institute in Aberdeen and at Merseybio in Liverpool. This progress has been assisted by the recruitment of a further senior scientist to the Liverpool R&D team, in addition to the research and development director and a senior formulation scientist that were recruited to this site in late 2010.

An update on the development projects being undertaken by the R&D team is set out below:

Isothiocyanates

The isothiocyanate-based cardiovascular inflammation work in collaboration with the Institute of Food Research ("IFR") is proceeding well. A novel extract has been developed and the first human trial is scheduled to commence in April 2011, with a target completion date before the end of the calendar year. A secondary trial will commence later this year, with a third and final trial to provide regulatory support for product launches scheduled for 2012.

The R&D team is also working closely with DSM on intellectual property for the promotion of healthy blood glucose levels. As announced by the Company on 28 February 2011, the Company remains in advanced discussions with DSM to enter into a long-term development agreement for this technology.

NSP#3G plantain extract

An interim review of patient data is proceeding on plan and an update will be given with the full year results. If the results are promising, together with extending the trial into further centres, this data will support initial commercial discussions that the Board intends to initiate.

Shareholders should be aware that the recruitment of patients for clinical trials in the area of inflammatory bowel disease is recognised as being challenging across the industry and as a result the Company has recently opened trial centres in Edinburgh and Bristol, with both of these sites now having patients in trial and with recruitment of further patients a priority. The Liverpool-based R&D team continues to research and characterise NSP#3G extracts for addressing C.difficile, the so-called hospital 'super bug', and antibiotic-associated diarrhoea.

Acquisition strategy

A significant amount of management attention continues to be given to reviewing the acquisition of new technologies or technology companies, in order to extend the breadth and potential of the Company's development pipeline.

Shareholders should be assured that the Company has a rigorous selection criteria when seeking any acquisition to ensure any potential acquisition is an appropriate fit and enhances long-term shareholder value. While the Company has not identified any acquisitions which fulfil such criteria during the period, the management team will continue to focus on this important strategic area, in order to support the Company's aim of establishing itself as a leader in functional food, medical food and dietary supplement technologies.

Financial position

The Company raised £2.4m in October 2010 by way of a drawdown from its equity financing facility, and the Company expects to report net cash of £7.6m at the year-end. Cash continues to be monitored closely and while investment in R&D has increased during the year, in line with the Company's current strategy, total expenditure will be less than the budget approved and monitored by the Board of Directors of the Company. The Board currently believes that the cash resources are sufficient for the Company to be able to commercialise its development pipeline.

Stephen Moon, CEO of Provexis, commented:

"We are working actively with DSM to maximise the commercial opportunity for Fruitflow and we are positive about the prospects for the coming financial year. While patient recruitment has resulted in slower than planned progress on the Crohn's disease trial, we remain committed to this programme, given the commercial opportunity related to this debilitating disease. The broader pipeline in gastrointestinal and cardiovascular technologies looks very promising and we are pleased with progress during the year. We look forward to updating shareholders on positive developments during the next financial year.

We maintain our focus on extending our pipeline through acquisition of technologies or technology companies and will continue to assess targets using exacting criteria, in order to maintain and develop our reputation for high quality functional food, medical food and dietary supplement technologies."

31 March 2011

Enquiries:

Provexis Plc      Stephen Moon, Chief Executive Ian Ford, Finance Director	Tel: [phone]
Evolution Securities Ltd Patrick Castle/Bobbie Hilliam	Tel:  [phone]
Haggie Financial LLP Matthew Longbottom	Tel: [phone] [e-mail]

 

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