Interim Results
Oxford Biomedica PLC
11 September 2007
For Immediate Release 11 SEPTEMBER 2007
OXFORD BIOMEDICA PLC
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2007
Oxford, UK - 11 September 2007: Oxford BioMedica (LSE: OXB), a leading gene
therapy company, announced today its interim financial results for the six
months ended 30 June 2007. Year to date highlights:
Operational highlights:
TroVax(R) (multiple cancers)
• Global development and commercialisation deal with sanofi-aventis
• Successful first DSMB review of Phase III TRIST study in renal cancer
• First milestone under sanofi-aventis agreement achieved
• Encouraging further Phase II results in renal cancer
• Sanofi-aventis to start Phase III trial in metastatic colorectal cancer
• QUASAR to start Phase III trial in early-stage colorectal cancer
ProSavin(R) (Parkinson's disease)
• Regulatory submission for start of Phase I/II trial in Parkinson's
disease
Other
• Acquisition of Oxxon Therapeutics for £16 million in shares
• Initiated new anti-cancer development programme
• Licensing agreement for LentiVector(R) technology with major US
biotechnology company
Financial highlights:
• Received initial payment of £19.7 million from sanofi-aventis
• Revenue recognised of £2.0 million (H1 2006: £0.2 million)
• Research and development costs of £10.8 million (H1 2006: £9.5 million)
• Loss after tax of £9.3 million (H1 2006: £8.7 million)
• Net cash generated1 of £10.4 million (H1 2006: cash burn1 £5.4 million)
• Gross cash and cash equivalents acquired with Oxxon Therapeutics of £3.8
million
• Net cash2 at 30 June of £42.5 million (30 June 2006: £38.7 million)
1. Net cash generated/used in operating activities plus sales and purchases
of non-current assets
2. Cash, cash equivalents and current financial assets
Commenting on the interim results, Oxford BioMedica's Chief Executive, Professor
Alan Kingsman, said: 'We have made excellent progress in the first half of the
year. Our collaboration with sanofi-aventis on TroVax is a significant event for
the Company. It validates our development strategy for TroVax and the product's
potential commercial value. The payments from the collaboration have also put
the Company in a strong financial position. Patient recruitment into the Phase
III TRIST trial of TroVax in renal cancer continues to be rapid, and
sanofi-aventis is now planning to start a Phase III trial in colorectal cancer.
Following the completion of our landmark deal with sanofi-aventis, we conducted
a strategic review of our pipeline to prioritise programmes for accelerated
development in order to maximise shareholder value. Arising from this review is
the key development priority of starting the first clinical trial of ProSavin in
Parkinson's disease, and we are on track with the regulatory process for this
study. We look forward to pursuing our development and commercial goals with
confidence. The Company has never been stronger than it is today.'
Analyst meeting:
An analyst briefing will be held at 10:00 am today at the offices of Buchanan
Communications, 45 Moorfields, London EC2Y 9AE.
Web cast:
Simultaneously to the analyst briefing at 10.00 am, there will be a live audio
web cast of the results presentation. To connect to the web cast facility,
please go to the Company's website: http://www.oxfordbiomedica.co.uk/
approximately 10 minutes (09:50 am) before the start of the briefing. This will
also be available for replay shortly after the presentation.
-Ends-
For further information, please contact:
Oxford BioMedica plc:
Professor Alan Kingsman, Chief Executive Tel: +44 (0)1865 783 000
City/Financial Enquiries:
Lisa Baderoon/ Mark Court/ Mary-Jane Johnson Tel: +44 (0)20 7466 5000
Buchanan Communications
Scientific/Trade Press Enquiries:
Gemma Price/ Holly Griffiths/ Katja Stout Tel: +44 (0)20 7268 3002
Northbank Communications
Notes to editors
1. Oxford BioMedica
Oxford BioMedica (LSE: OXB) is a biopharmaceutical company specialising in the
development and commercialisation of novel cancer immunotherapies and gene-based
medicines. The Company was established in 1995 as a spin-out from Oxford
University, and is listed on the London Stock Exchange.
The Company has a platform of gene delivery technologies, which are based on
highly engineered viral systems. Oxford BioMedica has in-house clinical,
regulatory and manufacturing know-how. The lead product candidate is TroVax(R),
an immunotherapy for multiple solid cancers, which is licensed to sanofi-aventis
for global development and commercialisation. A Phase III trial of TroVax in
renal cancer is ongoing and Phase III trials in colorectal cancer are planned.
Oxford BioMedica has two other oncology therapies in clinical development and
expects to start a Phase I/II trial of its novel gene therapy for Parkinson's
disease, ProSavin(R), in 2007.
The Company is underpinned by over 80 patent families, which represent one of
the broadest patent estates in the field. The Company has a staff of
approximately 80 split between its main facilities in Oxford and its wholly
owned subsidiary, BioMedica Inc, in San Diego, California. Corporate partners
include sanofi-aventis for TroVax and Wyeth for a novel targeted antibody
therapy. The Company also has collaborations with Sigma-Aldrich, MolMed and
Virxsys and has licensed technology to multiple partners, including Biogen Idec,
Merck & Co, GlaxoSmithKline and Pfizer.
Further information is available at www.oxfordbiomedica.co.uk
Chairman's and chief executive's report
In the first half of 2007, the Company achieved a major objective in securing a
global partner for TroVax. The agreement with sanofi-aventis brings the
experience and resources of a leading oncology company to bear on the programme.
The payments to Oxford BioMedica could amount to €518 million if TroVax is
registered for certain defined indications, plus additional undisclosed
commercial milestones and royalties. This is one of the most valuable licensing
agreements for an active cancer immunotherapy to date. The initial payment was
€29 million. A further payment of €9 million was triggered by the achievement of
the first development milestone, which was announced on 11 September 2007. Other
significant events since the beginning of 2007 include further encouraging Phase
II results for TroVax in renal cancer, the acquisition of Oxxon Therapeutics to
strengthen the Company's intellectual property position in immunotherapy, a
regulatory submission for clinical development of ProSavin in Parkinson's
disease, and initiation of a new anti-cancer development programme.
Strategy
Oxford BioMedica's mission is to be the leading company in the development and
commercialisation of innovative gene-based medicines, thereby creating a highly
profitable biopharmaceutical company. Following the Company's global
collaboration with sanofi-aventis for TroVax, Oxford BioMedica has reassessed
its development priorities to ensure that internal resources are focused on
product candidates that offer the greatest potential value to shareholders. The
evaluation considered the potential commercial opportunity together with the
anticipated profile, timelines and costs of development of each product.
In oncology, the strategy is to expand the immunotherapy platform, as
demonstrated by the acquisition in March 2007 of Oxxon Therapeutics, which
included key assets in prime-boost immunotherapy. The acquisition value for
Oxxon was £16 million, which was satisfied by the issue of Oxford BioMedica
shares. The assets acquired included cash and cash equivalents of £3.8 million.
In addition to its immunotherapy efforts, the Company's priority in oncology
will be to develop gene-based approaches that have the broadest possible
application, and thus the greatest commercial opportunity. In particular, the
Company initiated a new anti-cancer programme, called EndoAngio-GT, in July 2007
through a licensing agreement with Children's Hospital Boston for two genes that
block blood vessel growth (angiogenesis). The new programme is expected to
benefit from development synergies with the Company's RetinoStat product
candidate, which uses the same genes to treat vision loss due to macular
degeneration. EndoAngio-GT's anti-angiogenic approach could be applied to the
treatment of a wide range of solid tumours. The mode of action is similar to
Roche/Genentech's product Avastin(R), but with potential advantages in terms of
safety and dosing regimens. Avastin(R) generated global sales of approximately
£1.2 billion in 2006.
As a result of the strategic review of its anti-cancer product opportunities,
Oxford BioMedica is seeking industry partners for further development of MetXia
and its Gene-Directed Enzyme Prodrug Therapy (GDEPT) technology. MetXia has
applications in niche markets as a localised treatment for certain cancers. It
has been successfully evaluated in Phase I/II trials in locally accessible
breast and an ongoing Phase II trial in non-resectable pancreatic cancer. These
studies have confirmed that MetXia can transform tumour tissue in a manner
expected to increase the local activity of chemotherapy.
The strategic prioritisation of the pipeline is consistent with the Company's
objective of starting clinical development with at least one new product per
year. The first clinical priority is to start the planned trial of ProSavin.
This novel gene therapy could offer a major advance to the treatment of
Parkinson's disease. The second priority is RetinoStat for wet age-related
macular degeneration. Regulatory approval of the Phase I/II trial of ProSavin is
expected before the end of 2007 and a submission to start trials of RetinoStat
is planned for 2008.
Following the licensing of TroVax, the Company has reviewed its strategy for
later-stage development and commercialisation of its in-house programmes and
core technologies. For certain products and territories, the Company will look
to co-develop and co-commercialise with partners, enabling Oxford BioMedica to
retain more value from the commercialisation of its products and move towards a
fully integrated business model with specialty sales and marketing capabilities.
R&D Pipeline
TroVax(R)
TroVax is Oxford BioMedica's lead cancer immunotherapy product candidate. It is
designed to stimulate a specific anti-cancer immune response and has potential
application in most solid tumours and at all stages of disease. The product
induces an immune response against the tumour associated antigen 5T4, which is
broadly distributed throughout a wide range of solid tumours. The product
consists of a Modified Vaccinia Ankara (MVA) vector, engineered to include the
gene for 5T4.
In March 2007, a global licensing agreement was signed with sanofi-aventis for
rights to develop and commercialise TroVax in all cancers. Subsequently, new
Phase II results in renal cancer were reported, the Data Safety Monitoring Board
conducted its first analysis of the Phase III TRIST study, and progress was made
towards the start of two Phase III trials in colorectal cancer. Both new trials
are expected to commence enrolment of patients within the next 12 months.
The agreement with sanofi-aventis is one of the largest alliances in the field
of cancer immunotherapy. Under the terms of this agreement, Oxford BioMedica
received an initial payment of €29 million. A further payment of €9 million was
triggered by the achievement of the first development milestone, on recruitment
of 350 patients in the TRIST study, which was announced on 11 September 2007.
The Company could receive a total of €518 million in initial and milestone
payments if development and registration targets are met for certain defined
indications. The agreement includes additional undisclosed regulatory milestone
payments for other cancer types, undisclosed commercial milestones when sales
reach certain levels, and escalating royalties on global sales. Sanofi-aventis
and Oxford BioMedica are co-funding the ongoing TRIST study and sanofi-aventis
is committed to funding all other research, development, regulatory and
commercialisation activities. Furthermore, Oxford BioMedica retains an option to
participate in the promotion of TroVax in the USA and the European Union.
The Phase III TRIST (TroVax Renal Immunotherapy Survival Trial) study commenced
in November 2006 in patients with locally advanced or metastatic clear cell
renal carcinoma. The trial is a randomised, placebo-controlled, two-arm study
comparing TroVax in combination with standard of care to placebo with standard
of care. The standard of care therapy is Sutent(R) (sunitinib), interferon-alpha
or interleukin-2. The protocol stratifies treatment between the standard of care
options to ensure that the allocation of TroVax and placebo is rigorously
balanced.
Over 350 patients have been randomised out of a target enrolment of
approximately 700 patients. Approximately 100 sites are open for recruitment in
the USA, the European Union and Eastern Europe. The primary endpoint for the
trial is survival improvement; secondary endpoints include progression-free
survival, tumour response rates and quality-of-life scores. The trial is being
conducted under a Special Protocol Assessment (SPA) agreement from the US Food
and Drug Administration (FDA). It is expected to complete in 2009.
In July 2007, the independent Data Safety Monitoring Board (DSMB) for the TRIST
study completed its first scheduled interim analysis. The DSMB concluded that
the trial should continue as planned without modification. The DSMB reviewed
safety and anti-cancer immune responses from the first 50 patients enrolled. The
DSMB is independent of Oxford BioMedica and sanofi-aventis. It is comprised of
leading clinicians and a biostatistician with relevant expertise in the
treatment of renal cancer and the conduct of clinical trials.
At the Annual Meeting of the American Society of Clinical Oncology in June 2007,
Oxford BioMedica and sanofi-aventis reported new data from two Phase II trials
of TroVax in renal cancer. TroVax was well tolerated with no serious adverse
events attributable to the treatment and the product induced anti-5T4 antibody
responses in 91% of patients. Twenty-four of 35 evaluable patients with clear
cell renal carcinoma (68%) showed disease control. Two patients had complete
responses, three had partial responses and 19 had stable disease for periods
exceeding three months, including three patients that were stable for more than
17 months. Preliminary analysis of clinical benefit showed a statistically
significant relationship between reduction in tumour burden in patients with
clear cell renal carcinoma and patients' anti-5T4 antibody responses (p=0.028).
This supports the hypothesis that the 5T4-specific immune response induced by
TroVax has therapeutic benefit.
Over the next 12 months, several significant events are anticipated in the
development of TroVax. Sanofi-aventis plans to start a randomised Phase III
trial of TroVax with first-line standard therapy in patients with metastatic
colorectal cancer. The provisional trial plan is to recruit over 1,000 patients
from sites worldwide. The trial design is expected to be finalised and submitted
to regulatory authorities within the next few months, with patient recruitment
commencing in the first half of 2008. Separately, the QUASAR group is planning a
randomised, placebo-controlled Phase III trial of TroVax in early-stage (Stage
II/III) colorectal cancer, which is designed to enrol approximately 3,000
patients. QUASAR is a UK-based clinical trials network that is funded from a
variety of sources including the UK Medical Research Council and the Department
of Health.
ProSavin(R)
ProSavin is the Company's lead gene therapy product based on its proprietary
LentiVector(R) gene delivery technology. ProSavin has the potential to
revolutionise the treatment of Parkinson's disease. The product uses the
LentiVector system to deliver the genes for three enzymes that are required for
the synthesis of dopamine. It is administered locally to the region of the brain
called the striatum, converting cells into a replacement dopamine factory within
the brain, thus replacing the patient's own lost source of the neurotransmitter.
In the first half of 2007, Oxford BioMedica completed non-clinical safety
studies of ProSavin, required for a regulatory submission to start trials. In
July 2007, the Company submitted a Clinical Trials Application (CTA) to the
French Health Products Safety Agency (Agence Francaise de Securite Sanitaire des
Produits de Sante - AFSSAPS). The CTA includes a proposed Phase I/II trial to be
conducted at the Henri Mondor Hospital in Paris, France, which is a centre of
excellence for neurosurgery. The proposed trial will enrol up to 18 patients who
are failing on the current standard therapy of L-DOPA but who are not
experiencing disabling dyskinesias (movement disorders that occur following
prolonged treatment with L-DOPA). There will be suitable intervals between the
treatments of each patient in the early stage of the trial. This cautious
approach is commensurate with a 'first in man' trial and has been discussed with
AFSSAPS. Oxford BioMedica hopes to begin the clinical trial at the end of 2007
or in early 2008.
In an industry-standard preclinical model of Parkinson's disease, ProSavin's
therapeutic effect from a single administration has been maintained for over 20
months. Efficacy was similar to that expected with standard daily treatment with
L-DOPA but with no evidence of the disabling dyskinesias associated with L-DOPA
treatment.
RetinoStat(R)
RetinoStat is the Company's novel gene-based treatment for wet age-related
macular degeneration (AMD) and diabetic retinopathy (DR), which are caused by
the unregulated and aberrant growth of leaky and disruptive blood vessels in the
retina. The product uses the LentiVector system to deliver two genes,
angiostatin and endostatin, that block the formation of new blood vessels.
Oxford BioMedica licensed the right to use these genes for treatment of ocular
diseases in 2003. Endostatin and angiostatin are endogenous anti-angiogenic
proteins discovered in the laboratory of Dr Judah Folkman, director of the
Vascular Biology Program at Children's Hospital Boston.
In May 2007, Oxford BioMedica and collaborators at Johns Hopkins University
School of Medicine in Baltimore presented encouraging preclinical data with
RetinoStat at the Association for Research in Vision and Ophthalmology Annual
Meeting. The presentation included preclinical proof of principle in an
industry-standard model of neovascular AMD.
Oxford BioMedica with Johns Hopkins University and in partnership with the
Foundation Fighting Blindness (FFB) and its support organisation, the National
Neurovision Research Institute (NNRI), is conducting additional non-clinical
studies with RetinoStat to support a regulatory submission for the start of
clinical trials. Preparations for manufacturing scale-up for the clinical
material are underway. The objective is to submit an Investigational New Drug
(IND) application to the US FDA for the start of trials in 2008.
StarGen(TM)
StarGen is Oxford BioMedica's novel gene-based therapy for the treatment of
Stargardt's disease. The disease is caused by a mutation of the ABCR gene which
leads to the degeneration of photoreceptors in the retina and vision loss.
StarGen uses the Company's LentiVector system to deliver a corrected version of
the ABCR gene. It is administered directly to the retina.
At the Association for Research in Vision and Ophthalmology Annual Meeting in
May 2007, Oxford BioMedica presented preclinical data with StarGen, showing
efficacy in an industry-standard model of Stargardt's disease. The StarGen
programme is part of a broad collaboration with the FFB and the NNRI to develop
gene-based therapies for ocular diseases. Further preclinical studies are being
conducted with researchers at Columbia University in New York.
EndoAngio-GT
During the first half of 2007, Oxford BioMedica initiated a new anti-cancer
development programme, EndoAngio-GT, based on the anti-angiogenic genes,
endostatin and angiostatin. These are the same therapeutic genes utilised in
RetinoStat. The Company secured a licence to use the genes for the treatment of
cancer from Children's Hospital Boston in July 2007.
RetinoStat is designed to block aberrant blood vessel growth in the retina,
whereas EndoAngio-GT is targeting new blood vessels that enable tumours to grow
and spread. The development of EndoAngio-GT is expected to benefit from
synergies with the RetinoStat programme.
The formation of new blood vessels, known as angiogenesis, plays a critical role
in the progression of most solid tumours. It has been clinically proven that
tumour growth can be suppressed by inhibiting tumour angiogenesis. Roche/
Genentech's anti-angiogenic cancer treatment, Avastin(R), generated global sales
of approximately £1.2 billion in 2006. Oxford BioMedica believes that
EndoAngio-GT has potential application as a treatment for a wide range of solid
tumours, and has potential advantages over Avastin(R) in terms of safety and
dosing regimens. Hence, the programme has substantial potential value.
Hi-8(R) MEL
Hi-8 MEL is a therapeutic vaccine for metastatic melanoma, which was added to
the pipeline following the Company's acquisition of Oxxon Therapeutics in March
2007. The product consists of two recombinant vectors, a plasmid DNA and a MVA
virus. Both vectors encode the Mel3 polyepitope string derived from five
different melanoma-associated antigens. The two vectors are administered
separately (heterologous prime-boost) to induce broad melanoma-specific T-cell
responses.
Oxxon Therapeutics has evaluated Hi-8 MEL in two clinical trials. Updated
results from a Phase II trial were presented at the American Association of
Immunologists Annual Meeting in May 2007. The trial, in 41 patients with Stage
III/IV melanoma, was designed to evaluate the immune and clinical responses
elicited by Hi-8 MEL. The product was highly immunogenic with 91% of patients
that received the optimal dose showing an antigen-specific immune response. In
terms of clinical benefit, eight patients (20%) showed a period of disease
control. The presentation included follow-up of one patient that exhibited a
sustained partial response for more than two years. The median survival for
immune responders was 100 weeks versus 37 weeks for non-responders (p < 0.001).
Oxford BioMedica plans to add further patients to the Phase II trial to confirm
the optimal dose and formulation of Hi-8 MEL for Phase III development. The
extension to the study is expected to start in 2008.
MetXia(R)
MetXia is Oxford BioMedica's localised anti-cancer therapy, designed to enhance
the effectiveness of cyclophosphamide, which is a widely used anti-cancer agent.
MetXia uses a highly engineered retroviral gene delivery system to deliver a
specific human cytochrome P450 gene. The product is administered locally to the
tumour site, enabling the P450 enzyme to be produced within the tumour. The
enzyme activates the prodrug cyclophosphamide at the tumour site, thus
increasing the effective concentration of the anti-tumour, cytotoxic derivative
of cyclophosphamide in the tumour mass.
MetXia is potentially useful as a localised treatment of certain solid tumours,
particularly those where cyclophosphamide is commonly used as a treatment. The
Company is targeting its development efforts for MetXia on the treatment of
pancreatic cancer through direct administration of both MetXia and
cyclophosphamide to the tumour. A dose-escalation, two-stage Phase II trial in
patients with non-resectable pancreatic tumours is expected to complete in 2007.
In this study, MetXia and cyclophosphamide are delivered directly to the
pancreatic tumour via a catheter, which is inserted through an artery. Nineteen
patients have been treated to date. The first part of the trial has been
completed. This was an open-label evaluation of two dose levels of MetXia
alongside a low dose of cyclophosphamide.
The second part of the study is ongoing. Patients are treated with MetXia at the
optimal dose, and with ascending doses of cyclophosphamide to determine the
maximum tolerated levels of cyclophosphamide. Three dose levels of
cyclophosphamide have been fully evaluated to date. The results suggest that
direct intra-arterial administration of MetXia and cyclophosphamide to the
tumour is well tolerated, up to the completed dose level, and that MetXia
induces efficient gene expression of P450 enzyme at the tumour site.
Encouragingly, of ten patients that are evaluable for analysis of tumour
responses, two patients have shown disease stabilisation. Another patient has
shown a reduction in tumour marker levels. Patient survival is difficult to
interpret for this heterogeneous patient group but has ranged from four to more
than 108 weeks.
The Company concluded in its recent strategic review and evaluation to seek
partners for further development and commercialisation of MetXia. This will
enable the Company to focus its resources on higher development priorities with
greater potential commercial value.
CME-548
In collaboration with Oxford BioMedica, Wyeth is developing a novel targeted
antibody therapy for the treatment of cancer. The product, CME-548, uses Oxford
BioMedica's monoclonal antibody against the 5T4 tumour associated antigen,
linked to the anti-cancer agent calicheamicin. Preclinical development of
CME-548 is ongoing.
TroVax-Vet
TroVax-Vet is Oxford BioMedica's veterinary 5T4-targeted immunotherapy programme
for the treatment of cancer in companion animals, focusing on dogs and cats.
Oxford BioMedica entered a research agreement for the development of the product
with a leading animal health firm in 2003. Following the sanofi-aventis
collaboration for TroVax in human cancers, Oxford BioMedica has decided on
commercial grounds not to renew the collaboration for TroVax-Vet.
Technology Licensing
Oxford BioMedica's technology licensing activities exploit the potential of its
suite of gene delivery technologies by providing third-party access for
research, product development or specific applications. Licensees of the
Company's technology include GlaxoSmithKline, Merck & Co and Pfizer.
In July 2007, another major US-based biotechnology company licensed the
LentiVector gene delivery technology for research activities in a joint
agreement with Sigma-Aldrich. Sigma-Aldrich is Oxford BioMedica's strategic
partner and exclusive licensee for the commercialisation of the LentiVector
technology for research use.
Viragen, which licensed the LentiVector technology in 2004 for the development
of an avian transgenic biomanufacturing system, reported further progress with
the technology and published results in a leading medical journal in January
2007. However, in June 2007, Viragen halted development of the programme as part
of its efforts to streamline its research focus. Oxford BioMedica and the Roslin
Institute, which was collaborating with Viragen on the development of the avian
transgenic system, are exploring alternative ways to advance the technology.
Intellectual Property
The Company broadened its intellectual property estate in immunotherapy through
the acquisition of Oxxon Therapeutics in March 2007. The key technology within
Oxxon was prime-boost, which is a method of producing a potent and specific T
cell-mediated immune response to any disease-related antigen. The prime-boost
platform has broad potential applications in developing prophylactic as well as
therapeutic products. Oxxon owned or had exclusively licensed a number of patent
families covering the prime-boost technology.
With the addition of Oxxon's intellectual property, Oxford BioMedica's patent
portfolio expanded to 131 granted patents at 30 June 2007, compared to 116 in
the previous year. A further 185 patent applications are pending. The Company
has a further 18 licenses from third parties for key technologies.
In July 2007, Oxford BioMedica signed a license agreement with Children's
Hospital Boston to extend the Company's existing rights for the anti-angiogenic
genes, endostatin and angiostatin, for the treatment of cancer in the
EndoAngio-GT programme. The Company had previously licensed rights to the genes
for the treatment of ocular diseases, and is employing the genes in RetinoStat.
Finance
The TroVax licence with sanofi-aventis has transformed the Company's financial
outlook. Revenue of £2.0 million in the first half of 2007 was higher than in
any previous financial period, and for the first time the Company was able to
report a positive cash flow from operations. The acquisition of Oxxon
Therapeutics brought in cash and cash equivalents of £3.8 million. The net loss
for the first half of 2007 was £9.3 million (H1 2006: £8.7 million). The total
of cash, cash equivalents and available for sale investments at 30 June 2007 was
£42.5 million (30 June 2006: £38.7 million).
Revenue in the first half of 2007 was £2.0 million. The initial receipt from the
sanofi-aventis TroVax licence was £19.7 million (€29 million), of which £1.9
million was recognised as revenue in the first half of 2007. The remaining £17.8
million was classified as deferred income and is expected to be recognised as
revenue over the next 21 to 33 months. Technology licence income was £0.1
million (H1 2006: £0.2 million). Cost of sales of £0.1 million relates to
royalties payable on relevant in-licensed patents..
Operating costs were £13.2 million: £2.4 million (22%) higher than the first
half of 2006. Increased staff costs accounted for £1.3 million. Charges for
share options were £0.2 million higher than the first half of 2006 at £0.4
million. External clinical and preclinical costs were similar to last year's
level at £5.1 million (H1 2006: £5.3 million). Legal and professional fees
associated with the TroVax licence in 2007 were approximately £0.3 million.
Oxxon expenses were £0.6 million, comprising £0.3 million for closure of the
former Oxxon offices and laboratories including severance payments, and £0.3
million running costs during the close-down period. The Oxxon business is now
fully integrated into Oxford BioMedica.
Grant income was £0.2 million lower than the first half of 2006. Net interest
income of £0.9 million was the same as in the first half of 2006. The tax credit
of £1.1 million was £0.4 million higher than the first half of 2006, mostly due
to higher eligible staff costs.
Overall the net loss was £9.3 million (H1 2006: £8.7 million).
The acquisition of Oxxon in March 2007 was valued at £16 million, and was
satisfied by the issue of 27,551,628 Oxford BioMedica shares to Oxxon
shareholders for the entire share capital of Oxxon and 4,219,618 shares for the
repayment of a loan from Oxxon shareholders to Oxxon. The number of shares
issued was determined by a reference price of 50.36p per share, being the
average closing price of Oxford BioMedica shares over the 30 days to 8 March
2007. Oxxon's key investors, who currently retain an interest in Oxford
BioMedica shares, are the venture capital firms Quester, MVM Life Science
Partners and US-based East Hill Management.
The acquisition resulted in an increase of £13.1 million in Oxford BioMedica's
intangible assets at 30 June 2007 due to the provisional fair value attributed
to Oxxon's prime-boost intellectual property and the Hi-8 MEL melanoma vaccine
programme. In accordance with the Companies Act, the premium of £13.6 million on
the consideration shares for the Oxxon acquisition has been credited to a merger
reserve.
Due to the £19.7 million initial receipt from sanofi-aventis, net cash generated
from operations in the first half of 2007 was £9.0 million (H1 2006: net cash
used in operations £5.8 million). Interest received was £0.8 million (H1 2006:
£0.5 million) and tax credit received was £0.8 million (H1 2006: nil), making
the net cash flow from operating activities £10.6 million (H1 2006: cash used
£5.3 million). Purchases of tangible and intangible fixed assets, net of sale
proceeds were £0.2 million (H1 2006: £0.1 million), resulting in net cash
generated of £10.4 million (H1 2006 net cash burn £5.4 million).
Cash and cash equivalents (gross) acquired with Oxxon were £3.8 million. Current
payables acquired, net of current receivables and tax credit, were £0.6 million.
Cash expenses of the acquisition were £0.4 million. Issues of shares for cash on
the exercise of share options raised £0.2 million (H1 2006: £0.2 million).
Overall, cash, cash equivalents and available for sale investments increased by
£14.0 million from £28.5 million at 31 December 2006 to £42.5 million at 30 June
2007. The achievement of the first development milestone in the sanofi-aventis
TroVax agreement, which was announced on 11 September 2007, triggers the payment
to Oxford BioMedica of a further €9 million (approximately £6 million).
In summary, the Company's financial position remains strong, enabling it to move
forward aggressively in the development of its prioritised product candidates.
Outlook
The collaboration with sanofi-aventis on TroVax has been a transforming event
for Oxford BioMedica. It validates the programme and provides the resources to
complete development and commercialisation of the product. Furthermore, the
initial payment and milestone payments to Oxford BioMedica provide valuable
funding for the Company's other in-house programmes. Importantly, the TroVax
programme remains on track, including recruitment into the Phase III TRIST study
in renal cancer and the start of other planned trials. In addition to TroVax,
the Company has prioritised and is seeking to accelerate development of both
ProSavin in Parkinson's disease and RetinoStat in wet age-related macular
degeneration.
Following its strategic review, the Company is focusing in-house development
efforts on programmes that offer the highest potential commercial value. This
has led to the addition to the pipeline of a novel anti-cancer programme,
EndoAngio-GT, which has broad potential application in the treatment of solid
tumours, and the decision to seek partners for further development of MetXia and
the GDEPT technology for the localised treatment of certain cancers.
The Company expects several clinical and commercial events over the next 12
months, including another milestone linked to the TRIST study of TroVax, the
start of Phase III trials in colorectal cancer by sanofi-aventis and QUASAR, and
the start of the Phase I/II trial of ProSavin in Parkinson's disease. In
addition, the Company continues to evaluate new opportunities to expand its
pipeline of novel gene-based medicines.
Consolidated income statement
for the six months ended 30 June 2007
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
Notes £'000 £'000 £'000
Revenue 3 2,041 208 760
Cost of sales (124) - -
Research and development costs (10,767) (9,456) (19,523)
Administrative expenses (2,453) (1,352) (2,699)
Administrative expenses comprise:
Administrative expenses before (2,123) (1,352) (2,699)
exceptionals
Exceptional administrative expenses 4 (330) - -
Total administrative expenses (2,453) (1,352) (2,699)
Other operating income: grants 16 249 360
receivable
Operating loss (11,287) (10,351) (21,102)
Interest payable and similar charges (17) (13) (29)
Interest receivable 955 952 1,743
Loss before tax (10,349) (9,412) (19,388)
Taxation 1,097 744 1,762
Loss for the period (9,252) (8,668) (17,626)
Basic loss and diluted loss per
ordinary share 5 (1.8p) (1.7p) (3.5p)
The notes on pages 13 to 21 form part of this financial information
Consolidated balance sheet
at 30 June 2007
Notes 30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Assets
Non-current assets
Intangible assets 6 14,814 1,641 1,665
Property, plant and equipment 7 761 944 819
15,575 2,585 2,484
Current assets
Trade and other receivables 8 3,822 1,772 2,202
Current tax assets 2,914 1,943 2,309
Financial assets: Available for sale
investments 33,924 31,000 20,500
Cash and cash equivalents 9 8,611 7,651 8,043
49,271 42,366 33,054
Liabilities
Current liabilities
Trade and other payables 10 8,864 5,771 4,671
Deferred income 11 7,645 83 92
Provisions 12 56 61 58
16,565 5,915 4,821
Net current assets 32,706 36,451 28,233
Non-current liabilities
Other non-current liabilities 13 95 - -
Deferred income 11 10,205 - -
Provisions 12 587 671 627
10,887 671 627
Net assets 37,394 38,365 30,090
Shareholders' equity
Ordinary shares 5,341 4,996 5,014
Share premium 108,938 106,311 106,732
Merger reserve 14,310 711 711
Other reserves (623) (633) (627)
Retained earnings - deficit (90,572) (73,020) (81,740)
Total equity 37,394 38,365 30,090
The notes on pages 13 to 21 form part of this financial information
Consolidated cash flow statement
for the six months ended 30 June 2007
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
Notes £'000 £'000 £'000
Cash flows from operating activities
Cash generated by/(used in)
operations 14 9,029 (5,752) (17,726)
Interest received 809 482 1,440
Tax credit received 771 - 650
Overseas tax paid (8) (25) (25)
Net cash from operating activities 10,601 (5,295) (15,661)
Cash flows from investing activities
Proceeds from sale of property, 1 - 1
plant and equipment
Purchases of property, plant and
equipment (97) (82) (192)
Purchases of intangible assets (63) - (24)
Net (purchase)/maturity of available
for sale investments (13,424) (7,500) 3,000
Cash and cash equivalents acquired
with subsidiary 15 3,759 - -
Acquisition costs (382) - -
Net cash (used in)/generated by
investing activities (10,206) (7,582) 2,785
Cash flows from financing activities
Net proceeds from issue of ordinary
share capital 175 234 629
Effects of exchange rate changes (2) (23) (27)
Net increase/(decrease)in cash and 568 (12,666) (12,274)
cash equivalents
Cash and cash equivalents at 1
January 8,043 20,317 20,317
Cash and cash equivalents at period
end 9 8,611 7,651 8,043
The notes on pages 13 to 21 form part of this financial information
Statement of changes in shareholders' equity
Group Share Share Translation Merger Retained
capital premium reserve reserve earnings
(deficit) Total
£'000 £'000 £'000 £'000 £'000 £'000
At 1 January 2006 4,984 106,097 (627) 711 (64,565) 46,600
Exchange adjustments - - (6) - - (6)
Loss for the 6 months
ended 30 June 2006 - - - - (8,668) (8,668)
Share options 12 214 - - - 226
Proceeds from shares issued
Value of employee services - - - - 213 213
At 30 June 2006 (unaudited) 4,996 106,311 (633) 711 (73,020) 38,365
Exchange adjustments - - 6 - - 6
Loss for the 6 months
ended 31 December 2006 - - - - (8,958) (8,958)
Share options 13 227 - - - 240
Proceeds from shares issued
Value of employee services - - - - 238 238
Issue of shares excluding
share options 5 155 - - - 160
Refund in respect of share
issue costs - 39 - - - 39
At 31 December 2006
(audited) 5,014 106,732 (627) 711 (81,740) 30,090
Exchange adjustments - - 4 - - 4
Loss for the 6 months
ended 30 June 2007 - - - - (9,252) (9,252)
Shares issued in
acquisition 318 2,083 - 13,599 - 16,000
Share options 9 133 - - - 142
Proceeds from shares issued
Value of employee services - - - - 420 420
Costs of share issues - (10) - - - (10)
At 30 June 2007 (unaudited) 5,341 108,938 (623) 14,310 (90,572) 37,394
The notes on pages 13 to 21 form part of this financial information
Notes to the financial information
1 Basis of preparation
The financial information for the six months ended 30 June 2007 is unaudited and
has been prepared in accordance with the Group's accounting policies as
described in note 2 and in accordance with the Listing Rules of the Financial
Services Authority. The financial information for the six months ended 30 June
2006 is also unaudited. These results have not been reviewed by the Group's
Auditors. The financial information relating to the year ended 31 December 2006
has been extracted from the full report for that year. The report of the
Auditors on the 2006 accounts was unqualified. The statutory accounts for the
year ended 31 December 2006 were approved at the Company's Annual General
Meeting on 3 May 2007 and have been delivered to the Registrar of Companies. The
financial information in this report does not constitute statutory accounts
within the meaning of Section 240 of the Companies Act 1985.
Copies of the interim results for the six months ended 30 June 2007 are being
sent to all shareholders. Details can also be found on the Company's website at
www.oxfordbiomedica.co.uk. Further copies of the interim results and copies of
the full report and accounts for the year ended 31 December 2006 can be obtained
by writing to the Company Secretary, Oxford BioMedica plc, Medawar Centre,
Oxford Science Park, Oxford, OX4 4GA.
This announcement was approved by the Board of Oxford BioMedica plc on 10
September 2007.
Use of estimates and assumptions
The preparation of financial statements in conformity with generally accepted
accounting principles requires the use of estimates and assumptions that affect
the reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Estimates and judgements are continually made and are based on
historic experience and other factors, including expectations of future events
that are believed to be reasonable in the circumstances.
Critical accounting estimates and assumptions
Where the Group makes estimates and assumptions concerning the future, the
resulting accounting estimates will seldom exactly match actual results. Due to
the amounts involved, the estimates and assumptions of the amounts accrued for
clinical trial costs have a greater risk of causing a material adjustment to the
carrying amounts of assets and liabilities within the present financial year.
The Group uses a percentage-of-completion method to accrue for such costs. This
method requires the Group to estimate the services performed by contractors to
date as a proportion of total services to be performed.
2 Accounting policies
The Group accounting policies are set out in the annual report for the year
ended 31 December 2006. The following policies have been expanded to take
account of business developments in 2007. The accounting policies have been
applied consistently to all the financial periods presented.
Revenue
The Group generates revenue as a result of product and technology licence
transactions. Product licence transactions typically have an initial upfront
non-refundable payment on execution of the licence, and the potential for
further payments conditional on achieving specific milestones, plus royalties on
product sales. Technology licence transactions typically have an initial upfront
non-refundable payment on execution of the licence and the potential for further
annual maintenance payments for the term specified in the licence. Where the
initial fee paid is non-refundable and there are no ongoing commitments from the
Group and the licence has no fixed end date, the Group recognises the element
received up front as a payment in consideration of the granting of the licence
on execution of the contract. Amounts receivable in respect of milestone
payments are recognised as revenue when the specific conditions stipulated in
the licence agreement have been met. Maintenance fees within the contracts are
spread over the period to which they relate, usually a year. Otherwise, amounts
receivable are recognised in the period in which related costs are incurred, or
over the period to completion of the relevant phase of development. Amounts
recognised exclude value added tax. Differences between cash received and
amounts recognised are included as deferred revenue where cash received exceeds
revenue recognised and as accrued revenue where revenue has yet to be billed to
the customer.
Exceptional items
Exceptional items represent significant items of income and expense which due to
their nature or the expected infrequency of the events giving rise to them, are
presented separately on the face of the income statement to give a better
understanding to shareholders of the elements of financial performance in the
period, so as to facilitate comparison with prior periods and to better assess
trends in financial performance. Exceptional items include non-recurring
reorganisation costs.
Intangible assets
Intangible fixed assets, relating to intellectual property rights acquired
through licensing or assigning patents and know-how are carried at historic
cost, less accumulated amortisation, where the useful life of the asset is
finite and the asset will probably generate economic benefits exceeding costs.
Where a finite useful life of the acquired intangible asset cannot be
determined, the asset is not subject to amortisation but is tested annually for
impairment. No amortisation has been charged to date, as the products
underpinned by the intellectual property rights are not yet available for
commercial use.
Expenditure on product development is capitalised as an intangible asset and
amortised over the expected useful life of the product concerned. Capitalisation
commences from the point at which technical feasibility and commercial viability
of the product can be demonstrated and the Group is satisfied that it is
probable that future economic benefits will result from the product once
completed. Capitalisation ceases when the product receives regulatory approval
for launch. No such costs have been capitalised to date.
Expenditure on research activities and development activities that do not meet
the above criteria, including ongoing costs associated with acquired
intellectual property rights and intellectual property rights generated
internally by the Group, is charged to the income statement as incurred.
Intellectual property and in-process research and development from acquisitions
are recognised as intangible assets at fair value. Any residual excess of
consideration over the fair value of net assets in an acquisition is recognised
as goodwill in the financial statements.
3 Segmental analysis
The Group's primary segment reporting is by geographical location of assets,
with business sector as the secondary format. Revenue and loss on ordinary
activities before taxation are derived entirely from the principal activity,
biotechnology research and development. The business segments comprise the
Group's UK and US operations. The majority of the Group's activities take place
in the UK, with the US subsidiary providing intellectual property management and
business development support to the UK operation. Since the reorganisation of US
activities in 2004, expenditure in the USA accounts for less than 10% of Group
costs. Purchases and sales between subsidiaries are eliminated on consolidation.
The Group's revenue derives wholly from assets located in the UK. By
destination, revenue derives from the European Union and the USA.
Year
Six months Six months ended
Revenue by destination ended ended 31
30 June 30 June December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
European Union 1,919 28 56
North America 122 180 704
Total revenue 2,041 208 760
4 Exceptional administrative expenses
Exceptional administrative expenses of £330,000 (2006: nil) were restructuring
costs associated with the integration of Oxxon Therapeutics Limited ('Oxxon')
and closure of the former Oxxon offices and laboratories following the
acquisition of Oxxon in March 2007. Severance and related costs for former Oxxon
employees were £247,000. Fixed asset write-offs (mostly leasehold improvements)
were £73,000. Other expenses were £10,000.
5 Basic loss and diluted loss per ordinary share
The basic loss per share has been calculated by dividing the loss for the period
by the weighted average number of shares of 521,354,933 in issue during the six
months ended 30 June 2007 (six months ended 30 June 2006: 499,147,326; year
ended 31 December 2006: 499,865,620).
The Company had no dilutive potential ordinary shares in either period which
would serve to increase the loss per ordinary share. There is therefore no
difference between the loss per ordinary share and the diluted loss per ordinary
share.
6 Intangible assets
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Cost
At 1 January 1,927 1,920 1,920
Additions - through business
combination 13,086 - -
Additions - separately 63 - 24
Disposals - (17) (17)
At period end 15,076 1,903 1,927
Impairment
At 1 January 262 279 279
Disposals - (17) (17)
At period end 262 262 262
Net book amount at period end 14,814 1,641 1,665
The value of intangibles acquired with the acquisition of Oxxon Therapeutics
Limited (note 15) is provisional, as a formal valuation has not yet been
completed. The valuation is expected to be finalised in the financial statements
for the year ended 31 December 2007.
7 Property, plant & equipment
Office
equipment, Computer
Short fixtures equipment
leasehold and and Laboratory
improvements fittings software equipment Totals
£'000 £'000 £'000 £'000 £'000
Cost
At 1 January 2007 2,608 87 281 2,670 5,646
Exchange adjustments (8) - - - (8)
Additions - through 79 10 2 8 99
business combination
Additions - separately 2 6 9 77 94
Dilapidation asset - (10) - - - (10)
effect of change in
discount rate
Disposals (79) (9) - (13) (101)
At 30 June 2007 2,592 94 292 2,742 5,720
Depreciation
At 1 January 2007 2,267 81 224 2,255 4,827
Exchange adjustments (8) - - - (8)
Charge for the period 52 5 21 90 168
Disposals (12) (3) - (13) (28)
At 30 June 2007 2,299 83 245 2,332 4,959
Net book amount at 30
June 2007 293 11 47 410 761
Office
equipment, Computer
Short fixtures equipment
leasehold and and Laboratory
improvements fittings software equipment Totals
£'000 £'000 £'000 £'000 £'000
Cost
At 1 January 2006 2,270 86 270 2,650 5,276
Exchange adjustments (27) - (1) - (28)
Additions at cost 36 1 14 62 113
Dilapidation asset 338 - - - 338
recognised in the period
Disposals - (1) (10) (40) (51)
At 30 June 2006 2,617 86 273 2,672 5,648
Depreciation
At 1 January 2006 2,093 74 212 2,066 4,445
Exchange adjustments (27) - (1) - (28)
Charge for the period 158 6 16 157 337
Disposals - (1) (10) (39) (50)
At 30 June 2006 2,224 79 217 2,184 4,704
Net book amount at 30
June 2006 393 7 56 488 944
Office
equipment, Computer
Short fixtures equipment
leasehold and and Laboratory
improvements fittings software equipment Totals
£'000 £'000 £'000 £'000 £'000
Cost
At 1 January 2006 2,270 86 270 2,650 5,276
Exchange adjustments (47) - (2) - (49)
Additions at cost 50 3 34 111 198
Dilapidation asset 335 - - - 335
recognised in the period
Disposals - (2) (21) (91) (114)
At 31 December 2006 2,608 87 281 2,670 5,646
Depreciation
At 1 January 2006 2,093 74 212 2,066 4,445
Exchange adjustments (47) - (1) - (48)
Charge for the period 221 9 34 273 537
Disposals - (2) (21) (84) (107)
At 31 December 2006 2,267 81 224 2,255 4,827
Net book amount at 31
December 2006 341 6 57 415 819
8 Trade and other receivables
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Amounts falling due after more than one year
Other receivables - rent deposit 146 190 150
Amounts falling due within one year
Trade receivables 9 158 241
Other receivables 1,362 881 765
Other tax receivable 330 173 220
Prepayments 1,903 349 603
Accrued income 72 21 223
3,676 1,582 2,052
Total trade and other receivables 3,822 1,772 2,202
Other receivables include £652,000 (June 2006: £34,000; December 2006: £245,000)
due from the Group's collaborative partner Sigma-Aldrich for reimbursement of
legal costs in respect of litigation in the United States of America against
Open Biosystems.
9 Cash and cash equivalents
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Cash at bank and in hand 5,777 252 2,343
Short term bank deposits 2,834 7,399 5,700
Total cash and cash equivalents 8,611 7,651 8,043
In addition to the cash and cash equivalents described above, the Group held
bank deposits of £33,924,000 (June 2006: £31,000,000; December 2006:
£20,500,000) with an initial term to maturity between five and twelve months
classified as available for sale investments.
Cash at bank and in hand includes £15,000 (June 2006: nil; December 2006:
£182,000) held in escrow for expenses of the TRIST Phase III clinical trial.
10 Trade and other payables - current
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Trade payables 3,397 851 1,579
Other taxation and social security 157 122 315
Accruals 5,310 4,798 2,777
8,864 5,771 4,671
11 Deferred income
At 30 June 2007 the Group had deferred income of £17,850,000 (June 2006:
£83,000; December 2006: £92,000). £7,645,000 (June 2006: £83,000; December 2006:
£92,000) was current, and £10,205,000 (June 2006 and December 2006: nil) was
non-current. Of this total balance, £17,780,000 (June 2006 and December 2006:
nil) relates to initial receipts from sanofi-aventis in April 2007 under the
TroVax licence agreement, which are being recognised as revenue over a period of
24 to 36 months.
12 Provisions Onerous
Dilapidation lease Total
£'000 £'000 £'000
At 1 January 2006 - 460 460
Exchange adjustments - (31) (31)
Credited to the income statement - (7) (7)
Tangible fixed asset recognised in the period 338 - 338
Utilised in the period - (41) (41)
Amortisation of discount 4 9 13
At 30 June 2006 342 390 732
Exchange adjustments - (21) (21)
Credited to the income statement - (1) (1)
Tangible fixed asset recognised in the period (3) - (3)
Utilised in the period - (38) (38)
Amortisation of discount 8 8 16
At 31 December 2006 347 338 685
Exchange adjustments - (7) (7)
(Credited)/charged to the income statement - (6) (6)
Tangible fixed asset recognised in the period (10) - (10)
Utilised in the period - (36) (36)
Amortisation of discount 9 8 17
At 30 June 2007 346 297 643
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Current 56 61 58
Non-current 587 671 627
Total provisions 643 732 685
The dilapidation provision relates to anticipated costs of restoring the
leasehold property in Oxford, UK to its original condition at the end of the
present leases in 2011, discounted at 5.69% per annum (June 2006: 4.74%;
December 2006: 4.96%). The provision will be utilised at the end of the leases
if they are not renewed.
The onerous lease provision relates to the estimated rental shortfall in respect
of a redundant property in San Diego, USA which has been sub-let for the
remainder of the lease term until June 2012, discounted at 5.63% per annum (June
2006: 4.72%; December 2006: 4.88%). The provision will be utilised over the
remaining term of the lease.
13 Non-current liabilities
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Other non-current liabilities - rent
deposit held 95 - -
14 Cash flow from operating activities
Reconciliation of loss before tax to net cash from operating activities
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2007 2006 2006
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Continuing operations
Loss before tax (10,349) (9,412) (19,388)
Adjustment for:
Depreciation 168 337 537
Loss on disposal of property, plant and
equipment 72 1 (1)
Interest income (955) (952) (1,743)
Interest expense 17 13 29
Charge in relation to employee share schemes 420 213 451
Changes in working capital:
(Increase)/decrease in trade and other
receivables (1,425) 447 (107)
Increase in payables 3,364 3,671 2,596
Increase/(decrease) in deferred income 17,758 (22) (13)
Decrease in provisions (41) (48) (87)
Net cash generated by/(used in) operations 9,029 (5,752) (17,726)
15 Acquisition of Oxxon Therapeutics Limited
On 9 March 2007 the Company purchased the entire issued share capital including
all voting rights of Oxxon Therapeutics Limited ('Oxxon'). In addition, a loan
of £1.7 million from the former owners of Oxxon was acquired. The purchase has
been accounted for as an acquisition. The assets acquired included cash and cash
equivalents of £3.8 million. On 2 April 2007 in an internal reorganisation, the
trade of Oxxon Therapeutics Limited together with all its assets and liabilities
was sold to the Group's principal operating subsidiary Oxford BioMedica (UK)
Limited.
From the date of acquisition to 2 April 2007 the net loss of Oxxon was £95,000.
From 2 April 2007 the Oxxon business was integrated with that of Oxford
BioMedica (UK) Limited, and the facilities formerly occupied by Oxxon were
closed down. From 2 April 2007 to 30 June 2007 the net loss attributable to the
Oxxon acquisition was approximately £517,000 of which closure and severance
costs of £330,000 are classified as exceptional administrative expenses.
All intangible assets were recognised at their provisional respective fair
values. Any residual excess of the consideration over the fair value of net
assets acquired will be recognised as goodwill in the financial statements.
The fair value adjustments contain some provisional amounts which will be
finalised in the accounts for the year ended 31 December 2007. Shares issued
were valued at the average market price over the 30 days ended 8 March 2007.
Acquisition of Oxxon Therapeutics Limited Carrying Provisional
values pre fair value Provisional
acquisition adjustment fair value
£'000 £'000 £'000
Intangible fixed assets 243 12,843 13,086
Property, plant and equipment 99 - 99
Receivables 100 - 100
Payables (930) - (930)
R&D tax credit receivable 268 - 268
Deferred tax liability on fair value of
intangibles - (3,926) (3,926)
Deferred tax asset - tax losses - 3,926 3,926
Cash and cash equivalents 3,759 - 3,759
Loans (1,700) 1,700 -
Net assets acquired 1,839 14,543 16,382
Goodwill -
Consideration 16,382
Consideration satisfied by:
Shares issued to acquire Oxxon share capital 13,875
Shares issued to redeem loan from former
parent of Oxxon 2,125
Expenses of acquisition 382
16,382
The net inflow of cash and cash equivalents on the acquisition of Oxxon was:
£'000
Cash and cash equivalents acquired 3,759
Cash costs of acquisition (382)
3,377
The provisional value of the intangibles acquired as part of the acquisition of
Oxxon was:
£'000
Hi-8 MEL melanoma vaccine and prime-boost intellectual
property 13,086
This information is provided by RNS
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