Full Year Results

RNS Number : 1895R

Evgen Pharma PLC

13 June 2018

 

For immediate release                                                                                                                 13 June 2018

Evgen Pharma plc

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

Final Results for the year ended 31 March 2018

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 2018.

Highlights

§ Interim data released from ongoing STEM (SFX-01 in the Treatment and Evaluation of Metastatic Breast Cancer) Phase IIa clinical study

§ 11 new sites opened for STEM trial in Spain, France, Belgium and UK and a total of 44 patients recruited to date

§ 2 new sites opened in UK in ongoing SAS (SFX-01 After Subarachnoid Haemorrhage) Phase IIb clinical study and 65 patients recruited to date

§ Launch of Scientific and Medical Advisory Board ("SMAB") with, as initial members, the sulforaphane experts Professor Giovanni Mann, Professor of Vascular Physiology, King's College, London, and Professor Albena Dinkova-Kostova, Professor of Chemical Biology, University of Dundee

§ Further elucidation of SFX-01 mechanism of action in breast cancer

§ Additional patents granted over SFX-01 including first patent grant in Europe for SFX-01, relating to manufacturing and scale-up processes

§ Financial performance in line with expectations:

-     Total comprehensive loss of £2.6m (2017: loss of £3.1m)

-     Net cash outflow of £0.2m (2017: outflow of £3.3m (before short-term investment movements))

-     Cash and short-term investments and cash on deposit at 31 March 2018 of £3.63m (31 March 2017: £3.86m)

§ Fundraising in December 2017 raised £2.1m after expenses

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

"We are very encouraged by the interim data from the STEM trial which was announced earlier this week. Patient recruitment in both trials is on track to report around the end of the year.

"Interest in the potential of sulforaphane continues to gain momentum. There are now approximately 1,800 peer-reviewed scientific publications on sulforaphane and, since the beginning of 2018, the publication rate is running at an all-time high of over five publications per week.

"With the ongoing growth of scientific data supporting the therapeutic potential of sulforaphane, together with the positive progress of our Phase II trials, we remain confident in the prospects for the Company."

Analyst meeting

A meeting for analysts will be held at 10.30am this morning, 13 June 2018, at the offices of Buchanan, 107 Cheapside, London EC2V 6DN.  Please contact Buchanan on 020 7466 5000 for further information.

An updated version of the Company's investor presentation will be available to download at www.evgen.com from 8.00am today.

Enquiries:

Evgen Pharma plc                                                Dr Stephen Franklin, CEO Richard Moulson, CFO www.evgen.com	c/o [phone]
Buchanan                                               Mark Court, Sophie Wills, Tilly Abraham	[phone]
Northland Capital Partners Limited Matthew Johnson, Tom Price (Corporate Finance) John Howes, Rob Rees (Corporate Broking)	[phone]
WG Partners LLP Nigel Barnes, Claes Spång	[phone]

Notes for editors:

About Evgen Pharma plc

Evgen is a clinical stage drug development company whose lead programmes are in breast cancer and subarachnoid haemorrhage, a type of stroke.  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 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

During the past year, Evgen has focused on the clinical development of our lead product candidate, SFX-01. We are testing SFX-01 in two indications, metastatic breast cancer and subarachnoid haemorrhage ("SAH"), and have now enrolled over two thirds of the total patients in each trial. In parallel, both our own research collaborators, and academics elsewhere, have made considerable progress in understanding the mechanisms of action of sulforaphane in different disease models. New collaborations were signed with a number of partners including King's College London and Imperial College London.

STEM is a 60 patient, Phase IIa open label study in metastatic breast cancer being conducted across Europe. Earlier this week we reported data from the first 20 patients to have entered the trial and we are delighted that the product is proving to be well tolerated with encouraging signs of anti-tumour activity.

SAS is a Phase IIb randomised, double blind, placebo-controlled study recruiting 90 patients in SAH at three centres. Being a blinded trial, data will become available only after recruitment is complete. Nevertheless, we can say that SFX-01 is demonstrating a benign safety and tolerance profile, particularly when compared with other therapies in the breast cancer and SAH areas.

Our collaborators at the University of Manchester presented data in January showing that SFX‐01 targets cancer stem cells in metastatic breast cancers and potently suppresses a key target believed to account for resistance to endocrine therapy. These findings add further support to our presumed mechanism of action for SFX-01 in breast cancer. Furthermore, and in relation to the mechanism of action of SFX-01 in subarachnoid haemorrhage, our CEO, Dr Stephen Franklin was invited to, and presented at, a recent expert meeting in Madrid which was dedicated to the Nrf2 pathway and its role in a number of neurodegenerative diseases. 

Our intellectual property ("IP") platform around sulforaphane continues to expand and we have identified, via our collaboration with the University of Liverpool, CSIC and the University of Seville, a number of sulforaphane analogues which could be developed as second-generation oncology products.

During the current financial year we expect to report final data on both ongoing trials with the opportunity for significant increases in the Company's valuation. We are very excited at the prospect of demonstrating the clinical benefits of our sulforaphane technology, with the capacity to move into pivotal clinical trials and secure the appropriate industry partners to complete commercialisation.

CHIEF EXECUTIVE OFFICER'S REVIEW

OPERATIONAL OVERVIEW

Evgen is developing a platform, comprising expertise, intellectual property and clinical data, around a new class of pharmaceuticals based on a molecule called sulforaphane.  Sulforaphane has attracted huge scientific interest and has been shown to have anti-cancer and neuroprotective qualities in a wide range of preclinical and clinical studies, for example breast cancer, prostate cancer, multiple sclerosis and autism. In particular, we are seeking to exploit sulforaphane's modulation of two separate and unrelated mechanistic targets: Nrf2 and STAT3.

Evgen has exclusive rights to the only technology (Sulforadex®) proven to synthesise this very unstable molecule in a stabilised composition that will satisfy regulatory and medicinal needs for a pharmaceutical and that can be used as a therapeutic. 

Evgen's first product developed using the Sulforadex® technology is SFX-01; a synthetic copy of sulforaphane stabilised within a cone-shaped sugar molecule called alphacyclodextrin. 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 subarachnoid haemorrhage ("SAH").

Our assets include novel analogues of sulforaphane that have been synthesised and have undergone a first screening, with a view to identifying the most promising of these compounds, thereby reinforcing our leading position in the sulforaphane field.

OBJECTIVE AND STRATEGY

Evgen's ambition is to be the world leader in sulforaphane and sulforaphane-like compounds, establishing a leading position in this new class of pharmaceuticals.  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;

·     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 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 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 academic research and we will facilitate investigator-initiated studies (completely or largely funded by the investigator or relevant charities) to broaden the range of applications for SFX-01 and increase our mechanistic understanding in these different disease areas.

Currently, we are working with research groups conducting pre-clinical work to investigate the potential of SFX-01, inter alia, in: triple negative breast cancer (University of Manchester, UK), prostate cancer (Tulane University, US), glioblastoma (University of L'Aquila, Italy), osteoarthritis (RVC, University of London, UK), ischaemic stroke and autism (both at King's College London, UK). We are hopeful that some of these projects will progress into clinical evaluation over the next few years. Furthermore, we have a mechanistic collaboration with Imperial College London (UK) and are reviewing the potential to support a clinical trial in Non-alcoholic Fatty Liver Disease led by the University of Dundee (UK).

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 has worked with University of Manchester scientists at 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. Crucially, the data also showed that SFX-01 is unique, compared with existing therapies, in deactivating phosphorylated STAT3, a key agent in cancer proliferation and resistance to current standards of care.

STEM 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 14 sites in the UK, France, Spain and Belgium.

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 failing 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 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 is a compassionate use programme that provides continued access to SFX-01 with follow-up for safety.

On 11 June 2018 we announced an interim update on the first 20 patients to have completed the trial. In particular, that at this interim stage, in the opinion of the Principal Investigator, Dr Sacha Howell, and of the Company's Chief Medical Advisor:

·     SFX-01 is proving to be well tolerated with no safety concerns arising

·     SFX-01 shows encouraging early signs of anti-tumour activity:

-    Four patients had their disease stabilised (that is, having come on to the trial with progressive disease, their tumours stopped progressing) for the full duration of the study through to, and including, a favourable final scan result at week 24.  Of these four patients, one also had a partial response, which is a reduction in tumour size of at least 30% on one scan

-    In addition to the above four patients, a further two patients had their disease stabilised through to, and including, the week 18 scan but then showed disease progression at the final week 24 scan. One of these two patients also demonstrated a partial response on one scan before disease progression was recorded at the final scan

All patients that have a favourable week 18 scan are registered in the compassionate use programme to ensure continuity of drug between the final week 24 scan and the scan result, which can be some time later. Those that have a favourable week 24 scan continue on the programme.

Putting this interim update into a clinical context, the trial's Principal Investigator, Dr Sacha Howell of the Christie Hospital, Manchester, UK, said:

"The design of the STEM study, adding the drug to endocrine therapy on which a patient's cancer was progressing, sets a high bar for SFX-01. In light of this, these interim results are highly encouraging. Objective responses indicate activity in this setting, and disease stabilisation for 6-12+ months represents clinically meaningful prolongation of response. SFX-01 is generally well tolerated and the results together, should they look similar in the final analysis, suggest further investigation of SFX-01 in advanced breast cancer is warranted."

Prof Francois Duhoux, of University Clinics St-Luc, Brussels, and the Belgium national coordinator for the trial, said:

"Six of these first 20 patients came through my clinic and I can confirm the excellent safety profile of SFX-01. These patients have metastatic disease and have demonstrated progression on their endocrine therapy prior to coming on the trial, and, instead of switching to an alternative regimen, they continued their endocrine therapy with the addition of SFX-01. While we must of course wait for the results of the entire study before making any definitive judgment, in this context I think that the initial results pertaining to efficacy are highly encouraging."

STEM remains on track to report around the end of 2018 with 14 sites having already recruited 44 patients across the UK, Belgium, Spain and France.

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 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, is a generic and has been used 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 erythroid2-related factor 2-antioxidant response element) pathway.

Sulforaphane, the active principal 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 DCI following SAH. 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 DCI), 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, 44 patients have been recruited from two UK centres: University Hospital Southampton and the Western General Hospital in Edinburgh. The Queen Elizabeth Hospital in Birmingham remains an initiated site but will now unlikely recruit patients due to their staffing restraints. However, St Bartholomew's Hospital in London has now also been initiated and is expected to recruit its first patient imminently. These centres are projected to be sufficient to meet recruitment targets and we continue to anticipate the read-out of the primary endpoints of the study around the end of calendar year.

EARLY STAGE PIPELINE

The Group acquired exclusive worldwide rights to analogues of sulforaphane from the University of Seville in 2015 as part of our strategy to secure a leading position in the intellectual property around sulforaphane‐based drugs. Researchers at the University of Liverpool have evaluated 41 analogues which represent new chemical entities based on sulforaphane's core structure. The analogues were assessed for their cytotoxic potential against a breast cancer cell line and for their ability to activate Nrf2, which is considered to have a key role in sulforaphane's mechanism of action against neurological conditions. The research work demonstrated that 21 of the analogues are at least twice as cytotoxic against (that is, able to eliminate) breast cancer cells as SFX‐01, with the most potent being eight‐fold more cytotoxic, and that none of the analogues are as potent as SFX‐01 as an activator of Nrf2. The results suggest that some of the analogues merit further study as anti‐cancer agents and they also provide reassurance that SFX‐01, as a synthesised and stabilised copy of naturally occurring sulforaphane, is the optimal sulforaphane‐based active for development in subarachnoid haemorrhage and potentially other neurological indications.

INTELLECTUAL PROPERTY UPDATE

During, and since, the last reporting period, our IP portfolio was further strengthened with a number of key patents being granted.

The current status of the intellectual property portfolio is as follows:

·     The "parent" patent application entitled "Stabilised Sulforaphane" is granted in Australia, Canada, EU and US and pending in Japan and Hong Kong

·     The principal manufacturing patent application, entitled "Scale-Up Process" is granted in Australia, China, Europe, Japan and the US and pending in Brazil and Canada

·     The patent application providing protection around novel analogues based on sulforaphane, and entitled "Sulforaphane Derivatives" is granted in Australia, China, Europe, Japan and the US and pending in Canada

In summary, a large part of the current patent portfolio has now moved to grant status. 

The Company still awaits its position with regard to compositional claims in Europe and Japan. The recent patent grant in Europe, entitled "Stabilised Sulforaphane" was expedited to secure additional process claims but a pending divisional application (which will likely be examined in 2018) will determine the extent to which compositional patent protection is secured in the EU. Likewise, the Japanese position with regard to compositional claims is expected in 2018.

Further patent protection is reviewed on an on-going basis, and new applications associated with product formulation and dosing regimens will be filed at the appropriate time.

RECENT ADVANCES IN SULFORAPHANE SCIENCE

There are now approximately 1,800 peer-reviewed scientific journals investigating sulforaphane, in terms of its mechanism of action and its potential therapeutic utility across a range of diseases. In calendar-year 2017, publications reached a record 187 and this will likely be surpassed again in 2018 as the publications count has already reached 126.

A recent publication from Mao et al (2018) further supports the idea that sulforaphane inhibits proliferation, induces apoptosis, and decreases the "stemness" of cancer cells through a mechanism related to STAT3 signalling ("Sulforaphane promotes apoptosis, and inhibits proliferation and self-renewal of nasopharyngeal cancer cells by targeting STAT signal through miRNA-124-3p").

In the field of neurology research, a publication by Yang et al (2018) supports the view that sulforaphane treatment may alleviate ischaemic injuries and cognitive dysfunction ("Protective effects of sulforaphane in experimental vascular cognitive impairment: Contribution of the Nrf2 pathway"). They report a sulforaphane-mediated neuroprotective effect that was associated with an enhanced activation of Nrf2 and an upregulation of heme oxygenase 1, resulting in reduced neuronal death and maintenance of the integrity of the blood brain barrier.

KEY PERFORMANCE INDICATORS

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 Strategic Report, and below are the other indicators (financial measures) considered pertinent to the business.

	(£m)
Year-end cash and short-term investments and cash on deposit held: (2017: £3.9m)	3.6

The reduction in year-end cash reflects working capital, pre-clinical and clinical expenditures during the year offset substantially by the fundraising in December 2017 which raised £2.1m net of expenses.

	(£m)
Cash flows (including short-term investments) Net cash outflow: (2017: £3.3m)	0.2

The net cash outflow again reflects working capital, pre-clinical and clinical expenditures during the year offset substantially by the fundraising completed during the year.

	(£m)
Operating loss: (2017: £3.7m)	3.0

The operating loss reflects pre-clinical and clinical activity in the year and related product manufacture.

FINANCIAL REVIEW

The financial performance for the year ended 31 March 2018 was in line with expectations.

Losses

The total loss for the year was £2.6m (31 March 2017: £3.1m) including a charge for share-based compensation of £0.1m (2017: £0.2m). Operating expenses excluding share-based compensation reduced to £2.9m (2017: £3.5m) principally because the costs of the ongoing clinical trials of SFX-01 are in part front-end loaded due to set-up costs which were incurred in 2017, and because the SAH clinical trial was put on temporary hold for six months during the year.

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 £0.1m (2017: £0.2m) and has no impact on cash flows.

Headcount

The average headcount of the Group for the year was 9 (2017: 10).

Taxation

The Group has elected to claim research and development tax credits under the small or medium enterprise research and development scheme of £0.44m (2017: £0.58m). The reduction compared with the prior year reflects lower spend on the clinical development programmes.

Share capital

In December 2017 19,166,667 ordinary shares of 0.25p each were issued pursuant to a placing to existing and new shareholders at 12p per share. The placing raised £2.3m before expenses.

A total of 837,600 ordinary shares of 0.25 pence each were issued pursuant to exercises of share options granted under individual share option grants. These options had an exercise prices of 5p in respect of 628,000 options and 0.875p in respect of 209,600 options.

Cash flows and financial position

The cash position (including short-term deposits) at 31 March 2018 decreased to £3.6m (31 March 2017: reduced to £3.9m). Continued clinical expenditure on the two phase II trials of SFX-01 and recurring general and administrative costs were partially offset by the share placing proceeds (£2.1m net) and receipt of the 2016 and 2017 tax credits (£0.67m).

As part of their going concern review the Directors have followed the guidelines published by the Financial Reporting Council entitled ''Guidance on Risk Management and Internal Control and Related Financial and Business Reporting''. 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 to the end of December 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 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 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.

PEOPLE

We were delighted to welcome Sally Ross to the senior management team as Clinical Development Officer. Sally has a strong scientific and regulatory background from AstraZeneca and Chiltern International and will support us as we plan for and execute late stage clinical trials in our lead programmes.

We have also recently established a Scientific and Medical Advisory Board ('SMAB') to provide us with additional scientific and clinical expertise to support our development. The first two members are Professor Giovanni Mann, Professor of Vascular Physiology at King's College London and Professor Albena Dinkova-Kostova, Deputy Head of Cancer Research Division /Professor of Chemical Biology at the University of Dundee School of Medicine. Both have extensive experience of working with sulforaphane; Professor Mann in looking at its action and role in neurology and cardiovascular disease and Professor Dinkova-Kostova in relation to cancer. Further appointments, including US-based scientists and clinicians, will be made in due course.

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 is positive. We have two Phase II trials of SFX-01 ongoing in different disease areas, with the potential for differentiated product formats. Furthermore, we support investigator-led academic studies in new disease areas and these are generating preclinical data which may ultimately support further trials, either of SFX-01 or novel analogues. 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 2018	12 June 2018

Consolidated Statement of Comprehensive Income

for the year ended 31 March 2018

	Notes	Year ended 31 March 2018 £'000	Year ended 31 March 2017 £'000
Operating expenses
Operating expenses		(2,915)	(3,449)
Share based compensation		(111)	(209)
Total operating expenses		(3,026)	(3,658)
Operating loss		(3,026)	(3,658)
Finance income		-	17
Finance expense		-	(3)
Loss on ordinary activities before taxation		(3,026)	(3,644)
Taxation		443	576
Loss and total comprehensive expense attributable to equity holders of the parent for the year		(2,583)	(3,068)
Loss per share attributable to equity holders of the parent (pence)	5
Basic loss per share		(3.28)	(4.19)
Diluted loss per share		(3.28)	(4.19)

Consolidated Statement of Financial Position

as at 31 March 2018

		Group
	Notes	As at 31 March 2018 £'000	As at 31 March 2017 £'000
ASSETS
Non-current assets
Property, plant and equipment		12	11
Intangible assets		113	128
Investments in subsidiary undertaking		-	-
Total non-current assets		125	139
Current assets
Trade and other receivables		77	84
Current tax receivable		432	660
Cash and cash equivalents		3,626	3,859
Total current assets		4,135	4,603
Total assets		4,260	4,742
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables		389	514
Total current liabilities		389	514
Equity
Ordinary shares	6	233	183
Share premium		12,560	10,495
Merger reserve		2,067	2,067
Share based compensation		1,587	1,476
Retained deficit		(12,576)	(9,993)
Total equity attributable to equity holders of the parent		3,871	4,228
Total liabilities and equity		4,260	4,742

Consolidated Statement of Changes in Equity

for the year ended 31 March 2018

	Ordinary shares £'000	Share premium £'000	Merger reserve £'000	Share based compensation £'000	Retained deficit £'000	Total £'000
Balance at 31 March 2016	183	10,495	2,067	1,267	(6,925)	7,087
Total comprehensive expense for the period	-	-	-	-	(3,068)	(3,068)
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	1,476	(9,993)	4,228
Total comprehensive expense for the period	-	-	-	-	(2,583)	(2,583)
Transactions with owners
Share issue - cash	48	2,034	-	-	-	2,082
Share issue - options exercised	2	31	-	-	-	33
Share based compensation
- share options	-	-	-	111	-	111
Total transactions with owners	50	2,065	-	111	-	2,226
Balance at 31 March 2018	233	12,560	2,067	1,587	(12,576)	3,871

Consolidated Statements of Cash Flows

for the year ended 31 March 2018

	Group
	Year ended 31 March 2018 £'000	Year ended 31 March 2017 £'000
Cash flows from operating activities
Loss before taxation	(3,026)	(3,644)
Finance expense	-	3
Depreciation and amortisation	21	17
Share based compensation	111	209
	(2,894)	(3,415)
Changes in working capital
(Increase)/decrease in trade and other receivables	7	(4)
Increase/(decrease) in trade and other payables	(125)	198
Cash used in operations	(118)	194
Taxation received	671	30
Net cash  used in operating activities	(2,341)	(3,191)
Cash flows from investing activities
Acquisition of intangible assets	-	(68)
Purchase of property, plant and equipment	(7)	(8)
Short-term investments and cash on deposit	-	2,006
Net cash (used in)/generated from investing activities	(7)	1,930
Cash flows from financing activities
Proceeds from issue of shares	2,333	-
Issue costs	(218)	-
Net cash generated from financing activities	2,115	-
Movements in cash and cash equivalents in the period	(233)	(1,261)
Cash and cash equivalents at start of period	3,859	5,120
Cash and cash equivalents at end of period	3,626	3,859

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 2018 has been extracted from the Group's audited financial statements which were approved by the Board of Directors on 12 June 2018 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 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 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 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.

The report of the auditor on the 31 March 2018 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:

'Material uncertainty related to going concern

We draw attention to note 2 in the financial statements concerning the group's ability to continue as a going concern. The going concern status of the group 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 fund raising does not occur in the short to medium term they would have an immediate requirement to seek alternative sources of funding. As stated in note 2, these events or conditions, along with other matters set forth in note 2, indicate that a material uncertainty exists that may cast doubt on the group's ability to continue as a going concern. Our opinion is not modified in respect of this matter.'

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 2018 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 2018.

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 Risk Management and Internal Control and Related Financial and Business Reporting''. 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 to the end of December 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 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 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 2018 and 31 March 2017, 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 ended 31 March 2018 £'000	Year ended 31 March 2017 £'000
Loss for the year attributable to equity holders for basic loss and adjusted for the effects of dilution	(2,583)	(3,068)

	As at 31 March 2018 Number	As at 31 March 2017 Number
Weighted average number of ordinary shares for basic loss per share	78,697,455	73,153,169
Effects of dilution:
Share options	-	-
Weighted average number of ordinary shares adjusted for the effects of dilution	78,697,455	73,153,169

	Year ended 31 March 2018 Pence	Year ended 31 March 2017 Pence
Loss per share - basic and diluted	(3.28)	(4.19)

The loss and the weighted average number of ordinary shares for the years ended 31 March 2018 and 2017 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
	Number	Share Capital £'000
At 31 March 2017	73,272,591	183
Issued on exercise of options	837,600	2
Issued under placing agreement	19,166,667	48
At 31 March 2018	93,276,858	233

On 31 August 2017 837,600 ordinary shares were issued in connection with the exercise of share options.

On 28 December 2017 19,166,667 ordinary shares were issued at a price of £0.12 raising £2.3 million which after share issue expenses of £0.2 million gave net consideration of £2.1 million.

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.

Key management compensation is disclosed in note 5 of the consolidated financial statements. Directors' emoluments are disclosed in the Directors' Remuneration Report.

During the year ended 31 March 2018, the Group purchased services totalling £187,822 (year ended 31 March 2017: £179,819) from The Clinical Trial Company Limited, a company of which Richard Moulson, a Director, is also a Director. The amount owed to The Clinical Trial Company Limited at 31 March 2018 was £2,077 (31 March 2017: £nil).

During the year ended 31 March 2018, the Group purchased consultancy services totalling £nil (year ended 31 March 2017: £3,600) from Dr Alan Barge, a Director. The amount owed to Dr Alan Barge at 31 March 2018 was £nil (31 March 2017: £nil).

During the year ended 31 March 2018, the Group purchased consultancy services totalling £17,970 (year ended 31 March 2017: £nil) from FD Consult Ltd, a company controlled by Richard Moulson. The amount owed to FD Consult Ltd at 31 March 2018 was £nil (31 March 2017: £nil).

During the year ended 31 March 2018, the Group was charged monitoring and Director fees totalling £26,500 (year ended 31 March 2017: £26,500) 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 2018 was £nil (31 March 2017: £nil).

During the year ended 31 March 2018, the Group was charged monitoring and Director fees totalling £nil (year ended 31 March 2017: £22,500) 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 2018 was £nil (31 March 2017: £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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