Full Year Results

RNS Number : 8743H

Evgen Pharma PLC

13 June 2017

 

For immediate release                                                                                                                        13 June 2017

Evgen Pharma plc

("Evgen Pharma", the "Company" or the "Group")

Final Results for the year ended 31 March 2017

Evgen Pharma plc (AIM: EVG), the clinical stage drug development company focused on the treatment of cancer and neurological conditions, announces its final results for the year ended 31 March 2017.

Highlights

§ First patient dosed in the ongoing SAS (SFX-01 After Subarachnoid Haemorrhage) Phase II clinical study 

§ First patient dosed in the ongoing STEM (SFX-01 in the Treatment and Evaluation of Metastatic Breast Cancer) Phase IIa clinical study

§ Orphan drug designation granted by the US Food & Drug Administration for the use of stabilised sulforaphane in subarachnoid haemorrhage ("SAH")

§ Positive data from preclinical studies of SFX-01 in various models of the relapsing remitting form of multiple sclerosis ("MS") presented at leading MS conference

§ Additional patents granted over manufacturing processes for SFX-01

§ Recently, and subsequent to the period, the first patient to enter the STEM trial has now been accepted onto the compassionate use programme, having demonstrated no disease progression during the trial

§ Financial performance in line with expectations:

-     Total comprehensive loss of £3.1m (2016: loss of £3.1m)

-     Net cash outflow (before short-term investment movements) of £3.3m (2016: inflow of £6.9m)

-     Cash and short term investments and cash on deposit at 31 March 2017 of £3.9m (31 March 2016: £7.1m)

Dr Stephen Franklin, Chief Executive Officer of Evgen Pharma, said:

"We are very pleased to have progressed our SFX-01 product candidate into two phase II clinical trials: in breast cancer and in subarachnoid haemorrhage. This is a significant step for Evgen Pharma, and for sulforaphane-based science.  

"The increasing body of evidence that sulforaphane has broad therapeutic potential, combined with our expanding IP portfolio over technology for manufacturing sulforaphane-based drugs at commercial scale, gives Evgen Pharma confidence in its clinical strategy."

Analyst meeting

A meeting for analysts will be held at 11.00am this morning, 13 June 2017, at the offices of Buchanan, 107 Cheapside, London EC2V 6DN.  Please contact Buchanan on 020 7466 5000 for further information.

Enquiries:

Evgen Pharma plc                                                Dr Stephen Franklin, CEO Richard Moulson, CFO www.evgen.com	c/o [phone]
Buchanan                                               Mark Court, Sophie Cowles, Stephanie Watson	[phone]
Northland Capital Partners Limited Matthew Johnson, Gerry Beaney, Margarita Mitropoulou (Corporate Finance) John Howes, Rob Rees (Corporate Broking)	[phone]

Notes for editors:

About Evgen Pharma plc

Evgen Pharma is a clinical stage drug development company whose lead programmes are in breast cancer and subarachnoid haemorrhage, a type of stroke.  It is also carrying out preclinical work in multiple sclerosis and has a clinical interest in prostate cancer.  The Company's core technology is Sulforadex®, a method for synthesising and stabilising the naturally occurring compound sulforaphane and novel proprietary analogues based on sulforaphane.  The lead product, SFX-01, is a patented composition of synthetic sulforaphane and alpha-cyclodextrin. 

Evgen Pharma commenced operations in January 2008 and has its headquarters at The Colony, Wilmslow, Cheshire and its registered office is at the Liverpool Science Park, Liverpool.  It joined the AIM market of the London Stock Exchange in October 2015 and trades under the ticker symbol EVG. 

For further information, please visit: www.evgen.com

For commissioned research on the Company, please visit: http://evgen.com/investors/analyst-coverage/

 

CHAIRMAN'S STATEMENT

OVERVIEW

Evgen Pharma has had another year of strong progress in the development of our lead product, SFX-01. We commenced dosing in two clinical trials, which have the potential to provide significant value inflexion points.

In oncology, we started a 60 patient open label study in metastatic breast cancer, which is currently recruiting in the UK and Belgium. This follows promising data from our long-standing collaboration with the Cancer Research UK Manchester Institute, showing a reduction in cancer stem cells in patient-derived breast cancer tissue in xenograft models.

In neurology, we started a randomised, double blind, placebo controlled study, which is recruiting 90 patients in subarachnoid haemorrhage ("SAH") at two UK centres.   Positive interim safety reviews from the independent Data Safety Monitoring Board confirm, thus far, the safety of SFX-01.

In an encouraging development, our commercialisation opportunity increased with the granting of orphan drug designation for SFX-01 in SAH by the US Food & Drug Administration ("FDA") in August 2016.

At a preclinical level, we released data at the 32nd Congress of the European Committee and Research in Multiple Sclerosis from a study on SFX-01 versus BG-12 (Biogen's Tecfidera^®) in various in vivo models of relapsing remitting multiple sclerosis. This data showed that SFX-01 appeared to be superior to Tecfidera^® in a relevant multiple sclerosis model enabling superior neurological recovery in the chronic stage post-relapse. 

In December, we also presented our promising preclinical breast cancer data at the 2016 San Antonio Breast Cancer Symposium.

During the year our partners at the University of Seville, the Spanish National Research Council and the University of Liverpool started a programme to synthesise and screen a series of novel, proprietary, sulforaphane analogues. All compounds have now been synthesised in Spain and the screening is underway in the UK.

Towards the year end our intellectual property position in connection with sulforaphane was reinforced with the grant of two US patents associated with the manufacturing of SFX-01. These add a further layer of protection to the granted US patent relating to composition of the active pharmaceutical ingredient.  As detailed in this announcement, a number of patents have now been granted in other territories or have received Notification of Allowance.

Finally, we were very pleased to pass through an MHRA Good Clinical Practice inspection in March 2017, which was a major endorsement of the Company's transition into a clinical stage company.

We remain very positive over the prospects for the Group as we progress our two principal Phase II trials and work on additional applications of SFX-01.

CHIEF EXECUTIVE OFFICER'S REVIEW

OPERATIONAL OVERVIEW

Background

The Evgen Pharma business opportunity is built around a naturally occurring compound called sulforaphane, a compound first isolated from the brassica family of plants.

Sulforaphane has attracted huge scientific interest. A large and growing number of scientific research papers have been published worldwide, underlining the compound's medical potential in multiple diseases (95 papers published in 2017 to the end of May), and increasing our understanding of the mechanism(s) of action of the compound. Sulforaphane has been shown to have anti-cancer and neuroprotective qualities in a wide range of preclinical and clinical studies, for example in breast cancer, prostate cancer, multiple sclerosis and autism. However, the daily dose of sulforaphane required to elicit these potential therapeutic effects is far greater than can practically and consistently be delivered from dietary sources.

When chemically synthesised, sulforaphane is a liquid and the molecule spontaneously breaks down unless stored at very low temperatures. Evgen Pharma's core technology seeks to unlock the therapeutic potential of sulforaphane, overcoming its inherent instability. The Company's patent-protected Sulforadex^® technology enables the scalable manufacturing of synthetic sulforaphane stabilised in a novel composition. This stabilised composition is a solid powder that can be formulated into pills and other medicinal formats. The Sulforadex^® technology is also applicable to novel compounds based upon the core sulforaphane structure, giving us the opportunity to develop a broad clinical pipeline and to become the world leader in sulforaphane and sulforaphane-like pharmaceuticals.

Evgen Pharma's first product developed using the Sulforadex^® technology is SFX-01, a synthetic copy of sulforaphane stabilised by an alpha-cyclodextrin lattice. SFX-01 has been advanced through preclinical and Phase I clinical trials and is now in Phase II in two separate indications: metastatic breast cancer and SAH.

Our assets include novel analogues of sulforaphane that have been synthesised and are being screened with a view to identifying the most promising compounds thereby reinforcing our leading position in the sulforaphane field.

Objective and strategy

Our objective is to establish a leading position in the development and commercialisation of pharmaceuticals based upon sulforaphane and related analogues. The strategy to achieve this objective is to:

§ continue clinical development of SFX-01 in SAH and metastatic breast cancer (see below);

§ capitalise on the broad potential of SFX-01 by appraising and, if commercially appropriate, initiating clinical studies in additional cancer and neurological indications, and exploring other types of disease where sulforaphane may be effective;

§ support investigator-initiated studies (i.e. academic units typically with grant funding) in new areas to increase scientific understanding and expand the clinical applications of SFX-01 in a cost-effective manner (see below);

§ expand our intellectual property portfolio, including specific dose regimes, product formulations and new uses, and composition of matter based on novel sulforaphane analogues;

§ complete one or more licensing agreements when attractive terms are achievable;

§ in due course, opportunistically diversify the product pipeline, where the Directors believe such opportunities have a good strategic fit.

Sponsored Programmes

Evgen Pharma is initially focusing on demonstrating the efficacy of SFX-01 in one oncology indication and one neurology indication to demonstrate the potential breadth of application of SFX-01 as an anti-cancer agent and neuroprotectant respectively:

•    STEM (SFX-01 in the Treatment and Evaluation of Metastatic Breast Cancer), a 60 patient multi-centre trial in Europe (including the UK); and

•    SAS (SFX-01 After Subarachnoid Haemorrhage), a 90 patient trial in the UK.

Evgen Pharma also has a clinical interest in other oncology and neurology indications, for example prostate cancer and multiple sclerosis.

Investigator-Initiated Studies

In addition to our core in-house programmes, we will continue to support investigator-initiated studies (completely or largely funded by the investigator or relevant charities) to broaden the range of applications for SFX-01.

In particular, three collaborations (in two new therapeutic areas) have progressed well and are presenting near-term clinical development opportunities:

•    Autism: a third-party, small (40 patient), randomised placebo controlled trial has shown that sulforaphane (delivered as a frozen botanical extract) significantly improved behavioural measures and there are now five clinical trials (with over 300 patients in aggregate) investigating the use of sulforaphane in autism. None of these is using a viable pharmaceutical product. Evgen Pharma has been approached by a UK consortium led by Dr Michael Absoud (St Thomas' Hospital) that wishes to trial SFX-01 for the treatment of autism in children using a randomised double blind Phase II trial. This is a relatively near-term opportunity to initiate an Investigator Initiated Study using non-dilutive grant funding.

•    Regenerative medicine (bone): Evgen Pharma has ongoing collaborations with the Mayo Clinic (US) and London's Royal Veterinary College (RVC); both are interested in SFX-01 as an agent that could potentially drive bone regeneration. With an interest in osteoporosis, the Mayo Clinic has previously shown that sulforaphane increases bone mass via an epigenetic mechanism that increases osteoblast differentiation. The RVC has previously presented data showing that SFX-01 improves bone architecture and gait in a naturally occurring model of osteoarthritis and a new scientific paper to this effect is in review.

PIPELINE

SFX-01 in breast cancer

Breast cancer is the biggest cause of cancer deaths in women worldwide. In around 75% of breast cancers, the hormone oestrogen plays a key part in tumour growth. Such tumours express the oestrogen receptor (ER+) and, if the cancer is metastatic, endocrine therapy is the main treatment. It is thought that hormone independent cancer stem cells are implicated in the development of resistance to hormone therapy and the spread of the disease by metastases. Since 2012, Evgen Pharma has worked with the Cancer Research UK Manchester Institute and together we have generated promising data showing SFX-01 reduces the number of cancer stem cells in patient-derived breast cancer tissue in xenograft models. The xenograft studies used a combination of hormone therapy and SFX-01, with the role of SFX-01 being to target the cancer stem cell population. This data was first presented at the American Association of Cancer Research annual conference in Philadelphia in April 2015 and further preclinical data was presented in December 2016 at the San Antonio Breast Cancer Symposium.

STEM (SFX-01 in the Treatment and Evaluation of Metastatic Breast Cancer) is a multi-centre, Phase IIa clinical trial. Led by Principal Investigator Dr Sacha Howell of the Christie Hospital in Manchester, the trial will recruit 60 patients from multiple sites in the UK and up to four other European countries. Two sites are currently open for recruitment in each of the UK and Belgium and a total of 9 patients have been enrolled to date.  As previously announced, due to protracted regulatory submissions in France, Spain and the Czech Republic, we are projecting the read-out from the study in the second half of calendar year 2018.  As the study is open label, the Company will issue an interim data analysis in the first half of calendar year 2018.

All STEM patients will have ER+ metastatic breast cancer and will have been on treatment with either tamoxifen, aromatase inhibitors (AI) or fulvestrant. Prior to entry to the STEM trial, patients must have previously responded to their current hormone therapy for at least six months but then present with progressive disease, thereby demonstrating the start of resistance to the hormone therapy.  Once entered into the trial, patients continue to receive their hormone therapy in addition to SFX-01 and have regular scans through to week 24.  Patients discontinue the trial when one of the scans shows disease progression or at week 24. 

The Company has recently announced that the first patient to enter the STEM trial is now approaching week 24, having demonstrated no disease progression for three consecutive scans.  On this basis, the Company has initiated a compassionate use programme, so that patients can continue to receive SFX-01 after week 24.

The primary endpoints are safety / tolerability and clinical benefit rate (CBR) as measured by RECIST (Response Evaluation Criteria In Solid Tumours). After 24 weeks, for responding patients, there will be a continued access programme and a follow-up for safety.

The trial is registered at ClinicalTrials.gov and can be viewed at this link:

https://clinicaltrials.gov/ct2/show/NCT02970682?term=SFX-01&rank=2

SFX-01 in subarachnoid haemorrhage

Aneurysmal SAH is a form of stroke, caused by a ruptured aneurysm which leads to a bleed in the subarachnoid space around the outside of the brain. It is a relatively rare condition, accounting for around 5% of all strokes. It is fatal in approximately 50% of cases with approximately 15% dying before they reach hospital. A delayed cerebral ischaemia (DCI), which happens 3-14 days after the initial haemorrhage, remains the single most important cause of morbidity and mortality in those patients that survive the initial bleed. Over 60% of surviving patients suffer some permanent neurological deficit.

Nimodipine, the current standard of care, has been generic for more than 20 years, during which time there have been no significant clinical advances in the treatment of SAH. Whilst SAH is relatively rare, the market potential for this devastating condition, with its high unmet clinical need, is significant. In October 2015, Credit Suisse estimated potential peak sales of $1.7bn by 2032 for a Phase III development product based on the intraventricular delivery of a nimodipine-based formulation.

SFX-01 is aimed at reducing the neurological damage associated with the DCI via the up-regulation of the Nrf2- ARE (nuclear factor erythroid 2-related factor 2-antioxidant response element) pathway. Sulforaphane, the active principle in SFX-01, is a well-known activator of the Nrf2-ARE pathway which plays a protective role in many physiological stress processes such as inflammatory damage, oxidative stress, and the accumulation of toxic metabolites, which are all involved in the cerebral vasospasm following SAH. On 30 April 2016, the first patient was dosed in the Company's Phase II clinical trial entitled 'SAS: SFX-01 After Subarachnoid haemorrhage'. The trial is a double-blind, placebo-controlled study of 90 patients; 45 receiving nimodipine and placebo and 45 receiving nimodipine and SFX-01. The primary endpoints are Transcranial Doppler (essentially blood flow as measured by ultrasound through the brain's blood vessels and a measure of the cerebral vasospasm), safety and pharmacokinetics. Importantly, secondary endpoints include a cognitive measurement of clinical improvement ("the modified Rankin Scale") assessed at 7, 28, 90 and 180 days post haemorrhage.  Potential follow-on studies would almost certainly have primary clinical endpoints based on such clinical outcomes.

The trial is registered at ClinicalTrials.gov and can be viewed at this link:

https://clinicaltrials.gov/ct2/show/NCT02614742?term=evgen&rank=1.

To date 34 patients have been recruited into the trial at one UK centre; University Hospital Southampton (UK). As previously announced, the Data Safety Monitoring Board ("DSMB"), a panel of independent experts, has now met on two occasions to analyse the unblinded data for safety and confirmed there are no safety issues attributable to SFX-01. The DSMB has however recommended that patients should henceforward be assigned to an arm of the study on a stratified basis to help correct an imbalance of baseline disease severity across the study's two arms: in one arm patients receive nimodipine, the current standard of care, plus placebo and in the other patients receive nimodipine plus SFX-01.  The Company has accepted the DSMB's recommendation and recruitment will continue once this stratification process has been designed and implemented.

As part of its risk mitigation strategy, the Company has initiated a second site (Queen Elizabeth Hospital Birmingham, UK) to accelerate patient recruitment, and recruitment at both centres is expected to recommence in the coming weeks.  The Company is now anticipating the read-out from the study around the end of calendar year 2018. 

SFX-01 in multiple sclerosis

The principal mechanism of action of SFX-01 in SAH is via sulforaphane's ability to upregulate the Nrf2 pathway, resulting in a wide range of antioxidant and anti-inflammatory effects. It is this pathway that is implicated in Biogen IDEC's treatment for multiple sclerosis, Tecfidera®. In-vitro studies have shown that sulforaphane is a more potent activator of Nrf2 than dimethyl fumerate, the active ingredient in Tecfidera®. In September 2016, Evgen presented a late-breaking abstract and poster at the 32nd Congress of the European Committee for Treatment and Research in Multiple Sclerosis (ECTRIMS) in London. The poster was entitled ''Efficacy of SFX-01, a sulforaphane-based drug in experimental autoimmune encephalomyelitis''. The study concluded that: "SFX-01 appears to be superior to BG-12 in the therapeutic EAE model. SFX-01 appears to exert maximum effects later in the course of the disease by enabling superior neurological recovery in the chronic stage after relapse. SFX-01 is a promising drug candidate in MS, and warrants further investigation."

The Group has completed a strategic review of the multiple sclerosis opportunity and has concluded that it would be prudent to appraise two further data sets prior to building a new direct investment and/or partnering proposition. Firstly, a review of the pharmacokinetic data from the cerebrospinal fluid (CSF) of the SAS trial confirming that the SFX-01 dose used results in brain-side delivery at concentrations expected to be therapeutically active. Secondly, a further dose-ranging preclinical experiment with histology at all doses. Together, and for minimal new investment, these data sets would significantly improve the risk profile associated with a significant investment in a Phase II trial.

Early stage pipeline

SFX-01 is a synthetic and stable sulforaphane, which has been shown to have excellent pharmacokinetics and a bioavailability of around 80%. When the synthetic sulforaphane is released from its sugar lattice in the gastrointestinal tract it has the same half-life in the body as naturally occurring sulforaphane and has been shown to be equipotent. Medicinal chemists at the University of Seville have gone on to create a range of novel compounds based upon the sulforaphane core structure. Evgen has in-licenced the Seville intellectual property presenting us with multiple new chemical entities based upon sulforaphane.

During the year our partners at the University of Seville, the Spanish National Research Council and the University of Liverpool started a programme to synthesise and screen a series of novel, proprietary, sulforaphane analogues. All compounds have now been synthesised in Spain and the screening is underway in the UK.

INTELLECTUAL PROPERTY UPDATE

During the year a number of patent applications have moved to grant or have moved to Notice of Allowance:

·     The core composition of matter patent, entitled, "Stabilized Sulforaphane," with expiry no later than 2028, is granted in the United States, Canada and Australia and is pending in Europe, Japan and Hong Kong.

·     The core manufacturing patent entitled "Scale-up process for Sulforadex", with expiry no later than 2033, is granted in the United States and is proceeding to grant in Australia and Japan.  It is pending in Brazil, Canada, China, Europe and India.

·     A further manufacturing patent entitled "Improving purity of Sulforaphane in a sample", with expiry no later than 2033, is granted in the United States and is pending in China, Europe and Japan.

·     The novel sulforaphane analogues composition of matter patent entitled "Sulforaphane-Derived Compounds, Production method thereof and the Medical, Food and Cosmetic use of same", with expiry no later than 2033, is granted in Spain and is proceeding to grant in Australia. It is pending in Canada, China, Europe, Japan and the United States.

Further patent protection associated with product formulation and dosing regimes is continually under review with new applications anticipated in 2018.

RECENT ADVANCES IN SULFORAPHANE SCIENCE

The scientific literature around sulforaphane continues to expand with 2016 seeing a record number of 172 peer-reviewed publications; and a further 95 by the end of May 2017.

The past 12 months have seen a number of papers support the hypothesis that sulforaphane targets cancer stem cells.  Sulforaphane has been shown to enhance the activity of taxanes against triple negative breast cancer by killing cancer stem cells and has been shown to target cancer stem-like cells in both pancreatic cancer and glioblastoma.

The literature around sulforaphane's mechanism of action has also moved forward.  A recent proteomic analysis to specifically identify sulforaphane binding targets in breast cancer cell lines has confirmed Keap1 as a potent high confidence target at concentrations that can be realistically administered to subjects. Other potent binders were MIF (macrophage migration inhibitory factor), NF-kB and STAT3. Interestingly, in two other recent studies, sulforaphane has been shown to induce programmed cell death in glioblastoma calls via STAT3 and improve the efficacy of a chemotherapy in gastric cancer cells by targeting cancer stem-like cells via the STAT3 pathway.

Finally, a study published in December 2016 further validated our selection of subarachnoid haemorrhage for clinical investigation. The administration of sulforaphane to rats following subarachnoid haemorrhage was demonstrated to enhance the activity of the Nrf2 pathway, attenuate the cerebral vasospasm, and significantly ameliorate two behavioural functions disrupted by the haemorrhage.

Global clinical trial activity

At the time of writing, there are 47 clinical trials registered as evaluating sulforaphane. Eleven are actively recruiting and two of those are registered by Evgen Pharma (SFX-01 in the Treatment and Evaluation of Metastatic Breast Cancer and SFX-01 After Subarachnoid Haemorrhage).

Only the Evgen Pharma trials are evaluating a drug development product in the form of a synthetic sulforaphane. The remaining trials are using botanical extracts derived from broccoli seeds and/or sprouts. Some contain no sulforaphane but rely upon the variable conversion by gut microflora, others have had sulforaphane enzymatically released and then the extract is frozen prior to use in the clinic.

Other than our own registered trials, no other clinical programme is using a pharmaceutical development product that can reliably deliver standardised doses of sulforaphane.  Of the nine "non-Evgen" trials, four are in autism; an area where SFX-01 has attracted the attention of clinicians in the UK with access to grant funding for a substantive Phase II study.

KEY PERFORMANCE INDICATORS

The Group's Key Performance Indicators include a range of financial and non-financial measures (such as clinical trial progress).  Details about the progress of our development programs (non-financial measures) are included elsewhere in this Chief Executive Officer's Review, and below are the other indicators (financial measures) considered pertinent to the business.

Year-end cash, short term investments and cash on deposit held: £3.9m (2016: £7.1m)

The reduction in year-end cash reflects working capital, pre-clinical and clinical expenditures during the year. Equity placings in August and October 2015 raised gross proceeds of £9.0m.

Cash flows (before short term investment movements): net (outflow) of £3.3m    (2016: inflow of £6.9m)

The net cash outflow again reflects working capital, pre-clinical and clinical expenditures during the year.

Operating loss: £3.7m (2016: £2.4m)

The increase in operating loss reflects greater clinical activity in the year.

FINANCIAL REVIEW

The financial performance for the year ended 31 March 2017 was in line with expectations.

Losses

The total loss for the year was £3.1m (31 March 2016: £3.1m) including a charge for share-based compensation of £0.2m (2016: £0.5m). Operating expenses excluding non-recurring administrative expenses increased to £3.5m (2016: £1.2m) principally because of costs associated with conducting clinical trials which commenced recruitment during the year. These include the manufacture of product for the trials, payments to sub-contractors who manage the trials and payments to the clinical sites running the trials. In addition, staff costs excluding share based payments increased by £0.3m with more senior level capability.

There were no non-recurring administration expenses during the year (31 March 2016: warrant charges £0.3m and IPO costs £0.4m).

Share based compensation

Accounting standards require a charge to be made against the grant of share options and recognised in the Consolidated Statement of Comprehensive Income. This amounted to £0.2m (2015: £0.5m) and has no impact on cash flows.

Headcount

Average headcount of the Group for the year was 8 (2016: 7).

Taxation

The Group has elected to claim research and development tax credits under the small or medium enterprise research and development scheme of £0.58m (2016: £0.09m). The substantial increase reflects expenditures associated with conducting clinical trials.

Share capital

A total of 129,729 ordinary shares of 0.25 pence each were issued pursuant to exercises of share options granted under The Evgen Pharma plc Long Term Incentive Plan (2016: 272,000). These options had an exercise price of nil pence per share and the nominal value was credited against the share premium account.

Cash flows and financial position

The cash position (including short-term deposits) at 31 March 2017 decreased to £3.9m (31 March 2016: increased to £7.1m), reflecting increased clinical expenditure as SFX-01 progressed into two Phase II trials and general and administrative costs.

PEOPLE

We were delighted to welcome Dr Bob Holland and Dr Tom Morris who became Medical Advisers (in neurology and oncology respectively) to the Company in September 2016. Dr Holland had a long career at AstraZeneca having been their VP and Head of Personalised Healthcare & Biomarkers and prior to that their VP and Head of Neuroscience Therapeutic Area. Dr Morris has held various medical roles in oncology at AstraZeneca including Senior Medical Director for Oncology, Executive Director of Clinical Programs and Medical Science Director for the Oncology Therapy Area.

John Bradshaw resigned as Finance Director in February 2017 to focus on his work with a new healthcare investment vehicle and Mark Wyatt left the Board at the year end to spend more time on his directorships of earlier stage companies in his investment portfolio with Enterprise Ventures. We were very pleased to welcome Richard Moulson to the Board as Chief Financial Officer. Richard brings considerable experience in life science and technology companies at CFO level.

David Howat, Chief Development Officer, left at the year end and we thank him for his contribution to establishing Evgen Pharma as a clinical-stage company. David Chadwick, who joined us in April 2016 was promoted to Head of Clinical Operations in January 2017. We are building out our drug development capability with additional staff to support David Chadwick and through a relationship with APTrans, a consultancy comprising mainly ex-AstraZeneca staff with deep and relevant expertise in a number of drug development disciplines such as toxicology and clinical pharmacology.

We thank all our academic and clinical partners, suppliers and staff for their continued support and enthusiasm. We would also like to thank our investors for their continued support.

OUTLOOK

The outlook for Evgen Pharma is positive. We have two Phase II trials of SFX-01 ongoing in different disease areas and pre-clinical and clinical data that supports clinical investigation in new indications. These include further opportunities in cancer and neurology but also in the field of regenerative medicine.  All have considerable commercial opportunity and we look forward to the future with confidence.

Barry Clare                                                                                          Dr Stephen Franklin

Chairman                                                                                            Chief Executive Officer

12 June 2017                                                                                      12 June 2017

 

Consolidated Statement of Comprehensive Income

for the year ended 31 March 2017

			Year		Year
		Ended			Ended
		31 March			31 March
		2017			2016
	Note	£'000			£'000
Operating expenses
Operating expenses		(3,449)			(1,232)
Share based compensation		(209)			(519)
Non-recurring administrative expenses		-			(683)
Total operating expenses		(3,658)			(2,434)
Operating loss		(3,658)			(2,434)
Finance income		17			8
Finance expense		(3)			(791)
Loss on ordinary activities before taxation		(3,644)			(3,217)
Taxation		576			85
Loss and total comprehensive expense attributable		(3,068)			(3,132)
to equity holders of the parent for the year
Loss per share attributable to equity holders of the parent (pence)
Basic loss per share	5	(4.19)			(6.29)
Diluted loss per share	5	(4.19)			(6.29)

 

Consolidated Statement of Financial Position

as at 31 March 2017

		As at	As at
		31 March	31 March
		2017	2016
	Note	£'000	£'000
ASSETS
Non-current assets
Property, plant and equipment		11	6
Intangible assets		128	74
Total non-current assets		139	80
Current assets
Trade and other receivables		84	79
Current tax receivable		660	115
Short-term investments and cash on deposit		-	2,006
Cash and cash equivalents		3,859	5,120
Total current assets		4,603	7,320
Total assets		4,742	7,400
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables		514	313
Total current liabilities		514	313
Equity
Ordinary shares	6	183	183
Share premium		10,495	10,495
Merger reserve		2,067	2,067
Share based compensation		1,476	1,267
Retained deficit		(9,993)	(6,925)
Total equity attributable to equity holders of the parent		4,228	7,087
Total liabilities and equity		4,742	7,400

 

Consolidated Statement of Changes in Equity

for the year ended 31 March 2017

Attributable to ordinary shareholders
					Shares	Share
	Ordinary		Share	Merger	to be	based	Retained
	shares		premium	Reserve	issued	compensation	deficit	Total
	£'000		£'000	£'000	£'000	£'000	£'000	£'000
Balance at 31 March 2015		73	-	2,067	1,750	466	(5,543)	(1,187)
Total comprehensive expense		-	-	-	-	-	(3,132)	(3,132)
for the period
Transactions with owners
Equity element of loan note		-	-	-	(1,750)	-	1,750	-
Share based compensation - share options		-	-	-	-	519	-	519
Share based compensation - warrants		-	-	-	-	282	-	282
Share issue - cash		19	1,840	-	-	-	-	1,859
Share issue - cash		47	6,645	-	-	-	-	6,692
Share issue - loan note conversion		23	2,017	-	-	-	-	2,040
Share issue - bonus issue		20	(20)	-	-	-	-	-
Share issue - options exercised		1	13	-	-	-	-	14
Total transactions with owners		110	10,495	-	(1,750)	801	1,750	11,406
Balance at 31 March 2016		183	10,495	2,067	-	1,267	(6,925)	7,087
Total comprehensive expense		-	-	-	-	-	(3,068)	(3,068)
for the period
Transactions with owners
Share based compensation - share options		-	-	-		209	-	209
Total transactions with owners						209		209
Balance at 31 March 2017		183	10,495	2,067	-	1,467	(9,993)	4,228

 

Consolidated Statements of Cash Flows

for the year ended 31 March 2017

	Year	Year
	Ended	Ended
	31 March	31 March
	2017	2016
	£'000	£'000
Cash flows from operating activities
Loss before taxation	(3,644)	(3,217)
Finance expense	3	791
Depreciation and amortisation	17	8
Share based compensation	209	801
	(3,415)	(1,617)
Changes in working capital
Increase in trade and other receivables	(4)	(47)
Increase in trade and other payables	198	104
Cash used in operations	194	57
Taxation received	30	-
Net cash used in operating activities	(3,191)	(1,560)
Cash flows from investing activities
Acquisition of intangible assets	(68)	(36)
Purchase of property, plant and equipment	(8)	(6)
Short-term investments and cash on deposit	2,006	(2,006)
Net cash generated/(used in) from investing activities	1,930	(2,048)
Cash flows from financing activities
Proceeds from issue of shares	-	9,014
Issue costs	-	(449)
Net cash generated from financing activities	-	8,565
Movements in cash and cash equivalents in the period	(1,261)	4,957
Cash and cash equivalents at start of period	5,120	163
Cash and cash equivalents at end of period	3,859	5,120

1.    General information

Evgen Pharma Plc ('Evgen' or 'the Company') is a public limited company incorporated and domiciled in England & Wales and is admitted to trading on the AIM market of the London Stock Exchange under the symbol EVG. The address of its registered office is Liverpool Science Park Innovation Centre 2, 146 Brownlow Hill, Liverpool, Merseyside L3 5RF.  The principal activity of the Company is clinical stage drug development.

2.    Basis of preparation and significant accounting policies

The financial information set out herein does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006.  The financial information for the year ended 31 March 2017 has been extracted from the Group's audited financial statements which were approved by the Board of Directors on 12 June 2017 and which, if adopted by the members at the Annual General Meeting, will be delivered to the Registrar of Companies for England and Wales. 

The financial information for the year ended 31 March 2016 has been extracted from the Group's audited financial statements which were approved by the Board of Directors on 27 May 2016 and which have been delivered to the Registrar of Companies for England and Wales.  The report of the auditor on these financial statements was unqualified, did not include any references to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under Section 498(2) or Section 498(3) of the Companies Act 2006.

The report of the auditor on the 31 March 2017 financial statements was unqualified, did not contain a statement under Section 498(2) or Section 498(3) of the Companies Act 2006 but did include a matter to which the auditors drew attention by way of emphasis without qualifying their report relating to the basis of preparation which is reproduced below:

'Emphasis of matter - Going concern

In forming our opinion on the financial statements, which is not modified, we have considered the adequacy of the disclosure made in note 2 to the financial statements concerning the Group's and Company's ability to continue as a going concern. The going concern status of the Group and Company is dependent upon the management of the timing of settlement of its liabilities and the raising of further funds in the short to medium term.

Forecasts prepared by management indicate that if they are unable to manage the Group's liabilities as planned or the external fundraising does not occur in the short to medium term they would have an immediate requirement to seek alternative sources of funding. This condition indicates the existence of a material uncertainty which may cast significant doubt about the Group's and Company's ability to continue as a going concern. The financial statements do not include the adjustments that would result if the Group or Company was unable to continue as a going concern.'

The information included in this preliminary announcement has been prepared on a going concern basis under the historical cost convention, and in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU and the International Financial Reporting Interpretations Committee (IFRIC) interpretations issued by the International Accounting Standards Board ("IASB") that are effective or issued and early adopted as at the date of these financial statements and in accordance with the provisions of the Companies Act 2006.

The information in this preliminary statement has been extracted from the audited financial statements for the year ended 31 March 2017 and as such, does not contain all the information required to be disclosed in the financial statements prepared in accordance with the International Financial Reporting Standards ('IFRS').

This announcement was approved by the board of directors and authorised for issue on 12 June 2017.

3.    Going concern

As part of their going concern review the Directors have followed the guidelines published by the Financial Reporting Council entitled ''Guidance on the Going Concern Basis of Accounting and Reporting on Solvency Risks - Guidance for directors of companies that do not apply the UK Corporate Governance Code''. The Directors have prepared detailed financial forecasts and cash flows looking beyond 12 months from the date of the approval of these financial statements. In developing these forecasts, the Directors have made assumptions based upon their view of the current and future economic conditions that will prevail over the forecast period.

The Directors estimate that the cash held by the Group together with known receivables will be sufficient to support the current level of activities into the first quarter of 2018. The Directors are continuing to explore sources of finance available to the Group and have confidence that they will be able to secure sufficient cash inflows from further fundraising for the Group to continue its activities for not less than 12 months from the date of approval of these financial statements; they have therefore prepared the financial statements on a going concern basis. Because the additional finance is not committed at the date of approval of these financial statements, these circumstances represent an uncertainty as to the Group's and Company's ability to continue as a going concern. Should the Group be unable to obtain further finance such that the going concern basis of preparation were no longer appropriate, adjustments would be required including to reduce balance sheet values of assets to their recoverable amounts, to provide for further liabilities that might arise and to reclassify fixed assets as current assets.

4.    Segmental information

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker is responsible for allocating resources and assessing performance of operating segments.

The Directors consider that there are no identifiable business segments that are subject to risks and returns different to the core business. The information reported to the Directors, for the purposes of resource allocation and assessment of performance is based wholly on the overall activities of the Group. The Group has therefore determined that it has only one reportable segment under IFRS 8.

5.    Loss per share

Basic loss per share is calculated by dividing the loss for the period attributable to equity holders by the weighted average number of ordinary shares outstanding during the year.

For diluted loss per share, the loss for the year attributable to equity holders and the weighted average number of ordinary shares outstanding during the year is adjusted to assume conversion of all dilutive potential ordinary shares.

As at 31 March 2017 and 31 March 2016, the Group had no dilutive potential ordinary shares in issue.

The calculation of the Group's basic and diluted loss per share is based on the following data:

	Year	Year
	Ended	Ended
	31 March	31 March
	2017	2016
	£'000	£'000
Loss for the year attributable to equity holders for basic loss and adjusted for the effects of dilution	(3,068)	(3,132)

	As at	As at
	31 March	31 March
	2017	2016
	Number	Number
Weighted average number of ordinary shares for basis loss per share	73,153,169	49,797,654
Effects of dilution: Share options	-	-
Weighted average number of ordinary shares adjusted for the effects of dilution	73,153,169	49,797,654

	Year	Year
	Ended	Ended
	31 March	31 March
	2017	2016
	Pence	Pence
Loss per share - basic and diluted	(4.19)	(6.29)

The loss and the weighted average number of ordinary shares for the years ended 31 March 2017 and 2016 used for calculating the diluted loss per share are identical to those for the basic loss per share. This is because the outstanding share options would have the effect of reducing the loss per ordinary share and would therefore not be dilutive under the terms of International Accounting Standard (''IAS'') No 33. 

 

6.    Share issues

Ordinary shares

		Company
		Share
		Capital
	Number	£'000
Issued and fully paid
Issued subscriber shares	1	-
Issued on acquisition of Evgen Limited	36,461	73
Issued for cash consideration	9,569	19
Subdivision of shares	36,778,769	-
Issued on loan conversion	9,350,225	23
Bonus issue	7,776,918	20
Issued under placing agreement	18,918,919	47
Issued on exercise of options	272,000	1
At 31 March 2016	73,142,862	183
Issued on exercise of options	129,729	-
At 31 March 2017	73,272,591	183

On 2 October 2014 the Company was incorporated with one ordinary share of £2.00 subscribed for £nil paid.

On 5 December 2014 the Company entered into an agreement to acquire the entire share capital of Evgen Limited, satisfied by the issue of 12,595 ordinary shares of £2.00 each, 18,849 ordinary A shares of £2.00 each and 5,017 ordinary B shares of £2.00 and the original ordinary share credited as being fully paid.

On 26 August 2015 9,569 ordinary shares of £2.00 each were allotted to subscribers raising a total of £2 million (gross).

On 12 October 2015 each ordinary share of £2.00 each was converted into 800 ordinary shares of £0.0025 each, each ordinary A share of £2.00 each was converted into 800 A shares of £0.0025 each and each ordinary B share of £2:00 was converted into 800 B shares of £0.0025 each.  Following this there were 17,732,000 ordinary shares, 15,079,200 A shares and 4,013,600 B shares in issue.

On 21 October 2015 7,776,918 ordinary shares were issued in connection with a bonus issue.

On 21 October 2015 6,553,330 A shares and 2,796,895 ordinary shares were issued in connection with the conversion of loan notes.

On 21 October 2015 all A shares and B shares then in issue were converted to ordinary shares, immediately following this conversion there were 53,951,943 ordinary shares in issue.

On 21 October 2015, following admission to the Alternative Investment Market of the London Stock Exchange, 18,918,919 ordinary shares of £0.0025 were issued at a price of £0.37 raising £7 million which after expenses of £0.7 million gave net consideration of £6.3 million.

On 14 January 2016 272,000 ordinary shares were issued in connection with the exercise of share options.

On 3 March 2017 129,729 ordinary shares were issued in connection with the exercise of share options.

The Group and Company do not have an authorised share capital as provided by the Companies Act 2006.

7.    Related parties

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.

During the year ended 31 March 2017, the Group purchased consultancy services totalling £nil (year ended 31 March 2016: £46,750) from Clarat Partners LLP, a partnership of which Barry Clare, a director, is a member. The amount owed to Clarat Partners LLP at 31 March 2017 was £nil (31 March 2016: £nil).

During the year ended 31 March 2017, the Group purchased consultancy services totalling £3,600 (year ended 31 March 2016: £nil) from Dr Alan Barge, a director. The amount owed to Dr Alan Barge at 31 March 2017 was £nil (31 March 2016: £nil).

During the year ended 31 March 2017, the Group purchased consultancy and accounting services totalling £40,160 (year ended 31 March 2016: £50,840) from Bradshaw Daniel Limited, a company controlled by John Bradshaw, a director until 1 March 2017. The amount owed to Bradshaw Daniel Limited at 31 March 2017 was £4,497 (31 March 2015: £2,556).

During the year ended 31 March 2017 the Group purchased services totalling £179,819 (year ended 31 March 2016: £96,367) from The Clinical Trial Company Limited, a company in which Richard Moulson, a director, is also a director. The amount owed to this company at 31 March 2017 was £nil (31 March 2016: £nil).

During the year ended 31 March 2017, the Group was charged monitoring and director fees totalling £26,500 (year ended 31 March 2016: £20,104) by SPARK Impact Limited, manager of North West Fund for Biomedical, a shareholder. The amount owed to SPARK Impact, manager of North West Fund for Biomedical at 31 March 2017 was £nil (31 March 2016: £nil).

During the year ended 31 March 2017, the Group was charged monitoring and director fees totalling £22,500 (year ended 31 March 2016: £21,451) by Enterprise Ventures Limited, manager of Rising Stars Growth Fund II, a shareholder. The amount owed to Enterprise Ventures Limited, manager of Rising Stars Growth Fund II at 31 March 2017 was £nil (31 March 2016: £nil).

8.    Report and accounts

A copy of the Annual Report and Accounts will shortly be sent to all shareholders with notice of the Annual General Meeting and will also be available to download from the Group's website at www.evgen.com.

 

END

 

 

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