Final Results

RNS Number : 6261C

ValiRx PLC

19 March 2014

 

For release at 07:00 on 19 March 2014

ValiRx Plc

("ValiRx" or "the Company")

Final Results

ValiRx Plc (AIM: VAL), a life science company with a focus on cancer diagnostics

and therapeutics for personalised medicine, announces its final results

for the year ended 31 December 2013.

HIGHLIGHTS

·      Administration expenses were £1,361,954 (2012: £1,481,717);

·      Expenditure on Research and Development rose 60% on the previous year to £1,622,383 reflecting increased investment made in the VAL201 clinical trial programme;

·      Net loss after taxation was £2,597,238 (2012: £2,163,948);

·      As at 31 December 2013, the Company had cash and cash equivalents of £960,267 (2012: £2,260,783); this has since increased substantially following the raising of equity finance and the divestment of shares in the US-listed company, VolitionRx, in January and February 2014 respectively;

·      Since November 2013, ValiRx has successfully secured over £4.3m of additional cash resource to strengthen the group's balance sheet and enable the group to drive the clinical process of its lead compound VAL201;

·      GeneICE-based lead compound VAL101 continues to show good progress in the pre-clinical phase - the programme currently benefits from a second Eurostars grant for up to €1.6 million;

·      Biomarker development programme, to support clinical and pre-clinical development, is now producing preliminary results. The programme is supported extensively by Finnish Government regional funding.

Oliver de Giorgio-Miller, Non-Exec Chairman of ValiRx, commented:

"The Company has achieved much this year and I am pleased to report that we now have a secure funding platform upon which we can consolidate the further development of VAL201, VAL101 and our biomarker portfolio and importantly, a platform from which we can advance VAL201 into First in-Human trials.  I look forward to the Company updating shareholders on future developments".

- ENDS -

For more information, please contact:

ValiRx plc	Tel: [phone]
Dr Satu Vainikka	www.valirx.com
Cairn Financial Advisers LLP (Nominated Adviser)	Tel: [phone]
Liam Murray / Avi Robinson
Daniel Stewart & Company Plc (Broker)	Tel: [phone]
David Hart
Peckwater PR	Tel: [phone]
Tarquin Edwards	[e-mail]

Notes for Editors

ValiRx Plc

ValiRx Plc is a biopharmaceutical company developing novel technologies and products in oncology therapeutics and diagnostics. The product focus is in the epigenomic analysis and treatment of cancer, but the technologies can be applied to other fields as well, such as neurology and inflammatory diseases.

The Company listed on AIM in October 2006 and is creating a portfolio of innovative products through investment in specific development projects. It actively manages projects within this portfolio as a trading company and is not an investment vehicle. The ValiRx business model spreads the risks of life science technology developments by minimising financial exposure and running a set of projects to defined commercial endpoints. This maximises returns to shareholders by adding value at the earlier stages where value increases per investment unit are the greatest.

The Company operates through the following divisional companies:

1. ValiFinn is the biomarkers and diagnostic development division

2. ValiPharma is the therapeutics division with two embedded technologies primarily directed at the treatment of cancers.

CHAIRMAN'S STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2013

I am pleased to report for the first time as Chairman, a solid performance by the Group, with real progress seen on a number of important fronts during the period.  Our key therapeutic and diagnostic development programmes continue to advance and the recent equity investment and divestment of shares in a US-listed entity that we announced recently - all combine to position the Company strongly as we move into a new financial year.

Operating expenses rose to £2,984,337 (2012: £2,492,193) reflecting the group's increased investment in its Research & Development programmes, predominantly to take the lead drug candidate VAL201 to clinical trials and to a much lesser extent to advance our GeneICE products to the next stage of development. Revenues in the reporting period of £124,868 largely derived from our biomarkers division, ValiFinn.  Research & Development tax credits were £309,541 (2012: £165,956) and bank interest income was £5,552 (2012: £19,001).  Our net loss for the year increased to £2,597,228 (2012: £2,163,948), however, after adjustment to reflect a change in the fair value of available-for-sale assets, the loss for the year stood at £2,702,258 (2012: £2,150,055).

As at 31 December 2013 the Company had cash and cash equivalents of £960,267 (2012: £2,260,783). However, post the period end, our cash position has increased substantially following the raising of equity finance and the divestment of shares in the US-listed company, VolitionRx, in January and February 2014 respectively.

In terms of strategy and the appropriate positioning of the Company, it is good to see ValiRx steadily growing in stature and enhancing both the value and number of its development assets. I believe the Group is well placed to continue in this vein and towards those value inflection points that exist across its portfolio.

Looking forward, we now have a secure funding platform upon which we can consolidate the further development of VAL201, VAL101 and our biomarker portfolio and importantly, a platform from which we can advance VAL201 through First in-Human trials.  I look forward to the Company updating shareholders on future developments.

Oliver de Giorgio-Miller

Non-Exec Chairman

19 March 2014

CHIEF EXECUTIVE'S REPORT FOR THE YEAR ENDED 31 DECEMBER 2013

2013 was a good year for ValiRx and I have been pleased to see its therapeutic development programmes moving forward encouragingly, giving a very positive outlook for the clinical trials.  Our clinical trial Project Team has signed off on the protocol for VAL201, the Company's leading anti-cancer therapeutic and its enhanced Phase 1b trial and its expected advance to a Phase 2 study.  Product development for VAL201 has been successful and world class clinical partners have been agreed for the forthcoming trials.

The period under review also saw VAL101, the Company's lead candidate deriving from the GeneICE platform, complete its first €1.4 million Eurostars programme and this progress was subsequently rewarded by a second grant of €1.6 million.  The Company has grown its companion diagnostics and biomarker unit and both before and after the year-end, we strengthened the balance sheet via a successful fund raise.

Fundraising

Since November 2013, the Company has raised a total of over £4.3m in additional cash resource, through equity investment and the divestment of shares in the US-listed company, VolitionRx.  This fundraising took place in a series of transactions, which comprised two equity fundraisings and an equity swap and a further US$601,578 (£364,000) through the divestment in shares of the US-listed entity.  The impact of these transactions has been to substantially strengthen the group's balance sheet and to allow the continuing clinical development of the lead compounds, VAL101 and VAL201.  This strengthening will hopefully enable the Company to potentially take advantage of corporate and technological opportunities as they may arise.

Divestment

The divestment occurred because the Board believed and continues to believe that the Company will obtain a better return for its shareholders by investing the proceeds received from the transaction in the continuing development of VAL101 and VAL201 and to see their development progress towards those respective value inflection points that exist across the portfolio.

VAL201

As has been reported in recent months, our trial protocol for our lead therapeutic, VAL201, has expanded significantly following advice from the principal investigators at University College Hospital, London and from the Medicines and Healthcare Products Regulatory Agency ("MHRA").  The trial has been expanded to include, not just patients with prostate cancer, but also patients with other solid tumours, such as breast cancer.  In addition, the end points of the study have widened to give us an early indication of the efficacy of VAL201 in arresting and reducing tumour growth.  Our number one priority in 2014 is to progress the compound through its expanded clinical trials and beyond, whilst in parallel, we will look to continue our dialogue with pharmaceutical companies vis-à-vis future partnering or out-licensing opportunities.

VAL101 & GeneICE

We have also been advancing pre-clinical studies of VAL101, one of our GeneICE drug candidates, with the support of another European Union "Eurostars" Grant.  The grant for €1.6m was announced on 15 August 2013 and it endorses VAL101's novelty and potential and will enable ValiRx to accelerate the drug's development to build the associated cancer models and hopefully to provide new hope for patients with orphan cancers.

Biomarkers

Biomarkers continue to be evaluated by our subsidiary company, ValiFinn, which is based in Finland and we were pleased to announce recently that ValiFinn has identified companion diagnostics for VAL201, which potentially could be commercialised or licensed to other pharmaceutical companies.

Outlook

In what has been a busy year, I am happy to see the team's hard work rewarded with strong progress in our programme development activities.  We will continue to energetically move our compounds forward to their next stage, whilst remaining alert for opportunities and ways in which to further grow the Company and enhance shareholder value.  I look forward to ValiRx's continued progress and development with both excitement and confidence.

Dr Satu Vainikka

Chief Executive

19 March 2014

VALIRX PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2013
			2013		2012
			£		£
Revenue			124,868		216,269
Cost of sales			(51,618)		(72,960)
			─────────		─────────
Gross profit			73,250		143,309
Research and development			(1,622,383)		(1,010,476)
Administrative expenses			(1,361,954)		(1,481,717)
			─────────		─────────
Operating loss			(2,911,087)		(2,348,884)
Finance income			5,552		19,001
Finance costs			(180)		(21)
			─────────		─────────
Loss on ordinary activities before taxation			(2,905,715)		(2,329,904)
Income tax expense			308,477		165,956
			─────────		─────────
Loss for the year			(2,597,238)		(2,163,948)
Other comprehensive income
Change in fair value of available-for-sale assets			(105,020)		13,893
			─────────		─────────
Loss for the year and total comprehensive income			(2,702,258)		(2,150,055)
			═════════		═════════
Loss per share - basic and diluted
From continuing operations			(0.15)p		(0.17)p
			═══════		═══════

VALIRX PLC
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2013
					Share capital	Share premium	Merger reserve	Reverse acquisition reserve	Share option reserve	Retained earnings	Total
					£	£	£	£	£	£	£
	Balance at 1 January 2012				5,399,984	3,247,539	637,500	602,413	52,140	(5,515,628)	4,423,948
	Changes in equity for 2012
	Loss for the year				-	-	-	-	-	(2,163,948)	(2,163,948)
	Change in fair value of available-for-sale assets				-	-	-	-	-	13,893	13,893
	Movement in the year				-	-	-	-	21,712	-	21,712
	Issue of shares				651,623	2,280,675	-	-	-	-	2,932,298
	Share issue costs				-	(191,062)	-	-	-	-	(191,062)
					─────────	─────────	─────────	─────────	─────────	─────────	─────────
	Balance at 31 December 2012				6,051,607	5,337,152	637,500	602,413	73,852	(7,665,683)	5,036,841
	Changes in equity for 2013
	Loss for the year				-	-	-	-	-	(2,597,238)	(2,597,238)
	Change in fair value of available-for-sale assets				-	-	-	-	-	(105,020)	(105,020)
	Issue of shares				307,750	692,437	-	-	-	-	1,000,187
	Share issue costs				-	(104,358)	-	-	-	-	(104,358)
					─────────	─────────	─────────	─────────	─────────	─────────	─────────
	Balance at 31 December 2013				6,359,357	5,925,231	637,500	602,413	73,852	(10,367,941)	3,230,412
					═════════	═════════	═════════	═════════	═════════	═════════	═════════
	Merger reserve
	The merger reserve of £637,500 exists as a result of the acquisition of ValiRx Bioinnovation Limited. The merger reserve represents the difference between the nominal value of the share capital issued by the Company and the fair value of ValiRx Bioinnovation Limited at 3 October 2006, the date of acquisition.
	Reverse acquisition reserve
	The reverse acquisition reserve exists as a result of the method of accounting for the acquisition of ValiRx Bioinnovation Limited and ValiPharma Limited.

VALIRX PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2013
				2013		2012
				£	£	£	£
ASSETS
Non-current assets
Intangible assets					1,882,762		1,803,405
Property, plant and equipment					685		4,363
Financial assets: available-for-sale investments					768,323		873,343
					─────────		─────────
					2,651,770		2,681,111
					─────────		─────────
Current assets
Inventories				4,078		2,727
Trade and other receivables				490,395		353,855
Cash and cash equivalents				960,267		2,260,783
				─────────		─────────
					1,454,740		2,617,365
LIABILITIES
Current liabilities
Trade and other payables					(876,098)		(261,635)
					─────────		─────────
Net current assets					578,642		2,355,730
					─────────		─────────
Net assets					3,230,412		5,036,841
					═════════		═════════
SHAREHOLDERS' EQUITY
Called up share capital					6,359,357		6,051,607
Share premium					5,925,231		5,337,152
Merger reserve					637,500		637,500
Reverse acquisition reserve					602,413		602,413
Share option reserve					73,852		73,852
Profit and loss account					(10,367,941)		(7,665,683)
					─────────		─────────
Total shareholders' equity					3,230,412		5,036,841
					═════════		═════════

VALIRX PLC
CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2013
		2013		2012
	£	£	£	£
Net cash outflow from operating activities		(2,232,552)		(2,131,745)
Taxation		164,892		132,353
Returns on investments and servicing of finance
Interest received	5,552		19,001
Interest paid	(180)		(21)
	───────		───────
Net cash inflow from returns on investments and servicing of finance		5,372		18,980
Capital expenditure and financial investment
Payments to acquire intangible assets	(132,135)		(132,145)
Payments to acquire tangible assets	(1,922)		(2,579)
Receipts from sales of tangible assets	-		535
	───────		───────
Net cash outflow for capital expenditure and financial investment		(134,057)		(134,189)
Financing
Issue of ordinary share capital	1,000,187		2,932,298
Cost of share issue	(104,358)		(191,062)
	───────		───────
Net cash generated from financing activities		895,829		2,741,236
		───────		───────
Net increase in cash and cash equivalents		(1,300,516)		626,635
Cash and cash equivalents at beginning of period		2,260,783		1,634,148
		───────		───────
Cash and cash equivalents at end of period		960,267		2,260,783
		═══════		═══════

VALIRX PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2013

1.    Basis of Preparation

The financial information set out above does not constitute the Company's statutory accounts for the year ended 31 December 2013, but is derived from those accounts. Statutory accounts for 2013 will be delivered to the Registrar of Companies following the Company's annual general meeting.

2.	Cash flows from operating activities
				2013	2012
				£	£
	Operating loss			(2,911,087)	(2,348,884)
	Depreciation of tangible assets			5,623	6,762
	Amortisation of intangible assets			55,537	48,579
	Loss on disposal of tangible assets			-	93
	Loss on disposal of intangible assets			-	25,218
	(Increase)/decrease in inventories			(1,351)	16,757
	Decrease/(increase) in receivables			7,045	(25,344)
	Increase/(decrease) in payables within one year			614,463	119,942
	Other non-cash movements			(2,782)	3,420
	Share option charge			-	21,712
				────────	────────
	Cash outflows from operating activities			(2,232,552)	(2,131,745)
				════════	════════

3.	Cash and cash equivalents		1 January 2013	Other non-cash changes		Cash flow		31 December 2013
			£	£		£		£
	Net cash:
	Cash at bank and in hand		2,260,783	-		(1,300,516)		960,267
			───────	───────		───────		───────
			2,260,783	-		(1,300,516)		960,267
			═══════	═══════		═══════		═══════
4.	Loss per ordinary share
	The earnings and number of shares used in the calculation of loss per ordinary share are set out below:
						2013		2012
	Basic:
	Loss for the financial period					(2,597,238)	(2,163,948)
	Weighted average number of shares					1,733,106,298	1,288,079,027
	Loss per share					(0.15)p	(0.17)p
						══════════	══════════
	There was no dilutive effect from the share options outstanding during the year.
	Following the issue of 902,109,521 ordinary shares of 0.1p each in January 2014, the number of allotted ordinary shares of 0.1p each in issue was 2,921,043,530.

5.         Publication of Report & Accounts

The report and accounts for the year ended 31 December 2013 will be posted to shareholders shortly and will be available from the Company's website, www.valirx.com.

 

END

 

 

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