Chiroscience Group - Interim Results
01 Ottobre 1997 - 9:31AM
UK Regulatory
RNS No 5852b
CHIROSCIENCE GROUP PLC
1st October 1997
CHIROSCIENCE GROUP PLC
INTERIM RESULTS
for the six months to 31 August 1997
Chiroscience Group plc today announces its interim results for the six months
to 31 August 1997.
Highlights:
- Revenues increase by 96% to #9.2m ($14.9m*), (1996: #4.7m).
- ChiroTech contributes first half sales of #5.9m ($9.6m*), (1996: #3.9m)
and an operating profit of #2.3m ($3.7m*), (1996: #0.2m); excellent outlook
for full year.
- Investment in research and development increases to #19.0m ($30.8m*),
(1996: #7.1m); net loss contained to #14.4m ($23.3m*), (1996: #7.6m).
- Levobupivacaine (ChirocaineT) successfully completes seven Phase III
trials, with published results in major surgery and post-operative pain
management; drug on course for European regulatory filing in December 1997,
US filing in April 1998.
- Two MMP inhibitors (D1927 and D2163), potential treatments for cancer,
completing pre-clinical studies for Phase I studies to begin by year end.
- Collaboration agreed in June with Schering-Plough Corporation to develop
oral treatments for asthma and other inflammatory diseases; leading candidate
D4418 successfully completes Phase I study, confirming no emesis.
- Further four collaborations agreed to exploit R & D capabilities;
opportunities to commercialise genomics technologies being negotiated.
Dr John Padfield, chief executive of Chiroscience, commented: "The product
pipeline we have created is leading to significant value for the Group.
Phase III development of ChirocaineT has continued on track, creating broad
clinical uses and a product of significant commercial opportunity. Our
approach to evaluating new drug discoveries in the clinic has been underlined
through the successful completion of the first clinical trial on our asthma
drug.
"Financially, the excellent ChiroTech revenue and profit performance has
underlined the value of this business which, through an expected strong
second half performance, will contribute to the control of the Group's cash
at the year end."
* US dollar equivalents are provided for reader convenience only at the
exchange rate of #1 = US $1.62.
For further information contact:
Dr John Padfield, Chief Executive Giles Sanderson/Steve
Andrew Burrows, Media Relations Jacobs
Rebecca Iveson, Investor Relations Financial Dynamics
Tel: +44 (0)171 831 3113
Tel: +44 (0)1223 420430
Http://www.chiroscience.com
Chiroscience Group plc
Chiroscience is an emerging pharmaceutical company operating in the UK and
USA, which uses its diverse technology platform to discover and develop novel
medicines for improved healthcare. The Group has two principal activities,
operating as Darwin Discovery and ChiroTech. Chiroscience is listed on the
London Stock Exchange.
Darwin Discovery embraces activities in Cambridge, Seattle and Stevenage,
including gene-based research and molecular biology, through chiral-based,
combinatorial, medicinal and process chemistries, to clinical development.
It is engaged in the discovery and development of innovative small molecule
drugs and related diagnostics with a therapeutic focus on autoimmune disease,
cancer, inflammation, pain and osteoporosis.
ChiroTech provides chiral technology services to customers within the
pharmaceutical and related industries and in support of Darwin Discovery's
research and development programmes.
The following is an extract from the Chiroscience Interim Report for 1997.
CHAIRMAN'S STATEMENT
The first half year has seen considerable technical and commercial
achievements throughout the Group.
Good progress has been made in the integration of Darwin Discovery's
activities, which brings together operations in Cambridge, Seattle and
Stevenage into a cohesive drug discovery business. Through the development of
cross-locational and multi-functional project teams our staff are gaining
increasing understanding of each other's capabilities, assisted by visits and
secondments and the creation of shared systems and databases. Collaborative
agreements have been established with Schering-Plough Corporation, PowderJect
Pharmaceuticals plc, Trega Biosciences Inc, Alcon Laboratories Inc and Geron
Corporation, all of which, if successful, will allow the Group to receive
additional revenues.
The ChiroTech business is continuing to build its reputation amongst the
pharmaceutical and related communities, reinforcing the decision to focus
this business and operate it under a separate management structure. ChiroTech
has had a good financial performance in the first half of the year, and the
prospects for the second half are very encouraging. We continue to explore
the greater potential which could be afforded to this business through
strategic alliances with manufacturing partners.
Much work has been undertaken in exploring the most effective way to
commercialise levobupivacaine (ChirocaineT), built upon a comprehensive
clinical trials programme which is nearing completion, with the first
regulatory filing planned for December 1997.
The area of pain and anaesthesia is one in which we have considerable
knowledge and expertise, and we have become increasingly aware that chronic
pain is an area of major unmet medical need. This has already brought in a
new development opportunity through our alliance with PowderJect
Pharmaceuticals. Few of the major pharmaceutical companies are devoting R &
D or sales and marketing resources to pain as an exclusive area of disease
focus; rather they see it as an additional revenue source associated with
sales in another product area.
One of the options under review by the Board is to access the pain-management
market further through an alliance with one or more companies with existing
products and sales force capabilities in the pain and neurology fields, with
the aim of building a significant presence in the area. Alternatively
levobupivacaine could be licensed to a major pharmaceutical company on a
global basis. The Board has currently ruled out the option of establishing
its own stand alone sales force. Negotiations are reaching advanced stages
for the options under consideration.
We continue to strengthen our management teams through the recruitment of key
members of staff ensuring our skill-base complements the changing needs of
the business. Dr Robert Jackson has joined the Board of Chiroscience Group
plc as Executive Director, with responsibility for Research and Development
within the UK operations of Darwin Discovery. He is working closely with Dr
David Galas, who is based in Seattle and has responsibility for Discovery
Research. I would like to take this opportunity to thank Dr Jon Dickens for
the role he played in establishing Chiroscience's R&D programmes and to wish
him well following his recent retirement from the Board and the Company.
Looking forward, ChiroTech's revenues and profitability are expected to
increase substantially in the coming months. During the second half we are
anticipating further advances in our development pipeline with consequent
potential for cash and revenue as a result of relevant commercialisation
strategies. New research targets are expected to be created from both our
Cambridge and Seattle operations, with opportunities to feed and maintain our
development pipeline. Commercialisation of our proprietary genomic
technologies will continue to be explored.
Revenues for the second half of the year are thus anticipated to exceed those
of the first half. Combining this with a reduction in expenditure levels as
ChirocaineT clinical trials are completed, there should be a significantly
smaller loss in the second half of the year. I look forward to reporting on
many exciting developments in six months' time.
Lord Chilver, Chairman
1 October 1997
FINANCIAL REVIEW
Revenues during the period rose to #9.2m (6 months to 31/8/96: #4.7m, year to
28/2/97: #11.5m), with #3.3m from Darwin Discovery operations (principally
from the Schering-Plough collaboration) and #5.9m from ChiroTech.
Following the acquisition of the Stevenage pilot plant in June 1996 and that
of Darwin Molecular in December, the number of employees has increased to 305
in this period from 180 for the comparable period last year. Expenditure on
clinical trials, reflecting the progression of the ChirocaineT, PDE IV and
MMP programmes, increased from #3.1m to #9.7m. As a result of these two
factors, our total investment in R & D increased to #19.0m compared to #7.1m
in the first half of 1996 and #18.8m for the full year to 28/2/97. Of this
increase in expenditure, #6.6m related to external trials costs and #4.0m to
the Seattle discovery research activities. Selling, general and
administrative expenses for the Group increased by #0.3m over the equivalent
period last year to #2.7m. However, the increase in revenues contained the
loss for the period to #14.4m compared to #7.6m last year.
Cash outflows for the period were #14.0m or #2.3m per month, resulting in
cash reserves at 31/8/97 of #37.4m. Capital expenditure in the period was
#0.9m (6 months to 31/8/97: #0.4m) reflecting the increased fixed asset base
of the business with the additions of the Seattle and Stevenage sites. As a
result of share option exercises which generated cash of #0.4m, the issued
share capital increased by 1.2m shares to 107.1m shares.
OPERATING REVIEW
During the first half of the year, a number of regulatory authorities
conducted Good Manufacturing Practice inspections at Stevenage, all to their
satisfaction, showing the professionalism and quality of our employees.
The following are further highlights of the period:
ChirocaineT (Levobupivacaine)
Levobupivacaine will be marketed under the trade name ChirocaineT following
the first applications for marketing approval in Europe in December 1997 and
in the United States in April 1998. The strategic considerations for
commercialising this product have been addressed in the Chairman's report and
preparations are in hand for registration and first launches during 1998.
The Group has invested considerable resources in the continuing development
of this important drug which, while having an excellent long-acting
anaesthetic profile, offers new opportunities in the disease management of
chronic pain. The clinical development programme is on course to create a
comprehensive set of label claims and results are consistent with our
expectations. New data were reported in September both in 75 patients
undergoing abdominal surgery and its expanded use in post-operative pain
where 120 patients received the drug alone and in combination with opioid
analgesics. Further new trial data will be reported in October.
Schering-Plough alliance - asthma
In June, the Group secured an extremely important collaboration with Schering-
Plough Corporation for the development of an oral treatment for asthma using
the Group's proprietary inhibitors of the phosphodiesterase IV (PDE IV)
enzyme known to be implicated in this inflammatory disease. The terms
include an access and milestone payments from Schering-Plough, together with
financing of research staff and adoption of all clinical costs, with
royalties payable to Chiroscience on resultant product sales. This alliance
with a world-leader in respiratory medicines should afford the best return to
shareholders on the research achievements of Chiroscience in this field. The
alliance gives Schering-Plough access to our development candidate, D4418,
which has successfully moved through its first Phase I trial demonstrating
that the principle of no emesis can be achieved in man at therapeutically
relevant doses.
MMP inhibitor programmes - cancer and inflammatory disease
D1927 and D2163 are completing their pre-clinical evaluation and Phase I
trials in human volunteers are planned to begin by the year end. These
candidate drugs are very well absorbed and have not shown any evidence of
musculoskeletal effects in extensive pre-clinical testing and their
selectivity profile should enable this to be confirmed in man.
D5410 is insufficiently well absorbed to make it an attractive commercial
candidate to treat arthritis. However, this compound inhibits a range of
MMPs and patient trials with D5410 in inflammatory bowel disease are planned
to begin in mid-1998, underlining our strategy of investigating multiple end
points for these inhibitors.
Collaborative Alliances
The alliances with Medeva plc on D2785 (d-threo-methylphenidate) and
Knoll/BASF on D2024 (Verapamil isomers) have both progressed during the
period. Five of the ten patents applied for internationally on D2785 have
been published. We are unaware of any competitive filings and are confident
of our priority position.
Three new alliances have been established exploiting the Group's
capabilities in inhibitor research (with Alcon Laboratories Inc in
ophthalmics), in combinatorial chemistry (with Trega Biosciences Inc in
inflammation) and in genomics (with Geron Corporation, in ageing diseases
related to the Werner's Syndrome gene, discovered by Darwin Molecular in
1996).
Discovery Research
Our development pipeline will be fuelled by the gene-based discovery work
undertaken in Seattle. The most advanced projects under way are those on a
bone-density related gene - which could result in a drug to treat
osteoporosis offering immense commercial opportunity - and on auto-immune
diseases - focused on psoriasis, but also encompassing a number of
inflammatory diseases such as arthritis. The genomics technologies available
in Seattle have been applied to identify a number of further opportunities in
the MMP field and are being used extensively on all in-house programmes. The
commercial value of our DNA tagging and DNA array technologies and our Mouse-
SourceT genetic tool are being established.
The broad availability of opportunities to exploit our genomic technology
programmes, discovery research projects and development pipeline have
required us to focus our resources on those of greatest commercial potential.
As a consequence, the single isomer cancer programmes D3967, D4809 and D7991
will proceed no further without the input of a collaborative partner.
Patient trials in D3967 and D7991 showed evidence of benefit, but their
limited commercial utility in a rapidly developing field where new oncology
agents are being developed does not justify further investment by the Group.
ChiroTech
ChiroTech has had an excellent first half with sales of #5.9m generating an
operating profit of #2.3m compared to #0.2m for the first half of last year
and #1.2m for the whole of the 96/7 year. The business is expanding, both in
the areas of catalysis and the chiral compound libraries soon to be launched
as the ChiroChemT collection. However, the major success has been in sales of
(-) lactam, for which we have significant orders in hand for the second half
of the year. Gross margins for this product are consistently greater than
50%, which reflects the earlier technology investments by the Group to
establish this opportunity. Accordingly, the business should have an
excellent second half and full year.
Chiroscience Group plc
Unaudited Consolidated Profit and Loss Account
6 months to 6 months 12 months to
31/8/97 to 28/2/97
#m's 31/8/96 #m's
#m's
Revenues 9.2 4.7 11.5
Cost of sales* (3.3) (3.8) (8.8)
Gross profit 5.9 0.9 2.7
Research and development (19.0) (7.1) (18.8)
costs*
Administrative expenses (1.7) (1.4) (3.0)
(note 6)
Sales and marketing and (1.0) (1.0) (2.5)
distribution costs
Operating loss (15.8) (8.6) (21.6)
Net interest receivable 1.4 1.0 2.3
Loss on ordinary (14.4) (7.6) (19.3)
activities before taxation
Tax on loss on ordinary - - -
activities
Retained loss (14.4) (7.6) (19.3)
Loss per share - basic (13.6p) (9.7p) (22.5p)
(note 3)
* The allocation of certain costs between research and development and
cost of sales has been restated to reflect the developing commercial
activities of the Group.
Chiroscience Group plc
Unaudited Consolidated Balance Sheet
31/8/97 31/8/96 28/2/97
#m's #m's #m's
Fixed assets
Tangible assets 8.5 6.8 9.1
Investments (note 5) 3.9 4.0 3.9
12.4 10.8 13.0
Current assets
Stock 1.0 0.9 1.0
Debtors 4.0 2.1 3.6
Investments in short term 36.7 47.0 50.8
securities
Cash at bank and in hand 0.7 0.7 0.6
Total current assets 42.4 50.7 56.0
Creditors: amounts due (9.1) (4.8) (9.6)
within one year
Net current assets 33.3 45.9 46.4
Net assets 45.7 56.7 59.4
Capital and reserves
Called up share capital 5.4 4.2 5.3
Share premium account 75.6 75.2 75.3
Other reserves 23.6 11.0 23.5
Profit and loss account (58.9) (33.7) (44.7)
Shareholders' funds 45.7 56.7 59.4
Chiroscience Group plc
Unaudited Consolidated Cash Flow Statement
6 6 months 12 months
months to to
to 31/8/96 28/2/97
31/8/97 #m's #m's
#m's
Cashflow from operating (15.0) (6.9) (16.3)
activities (note 4)
Returns on investments and
servicing of finance
Interest received 1.4 1.1 2.3
Capital expenditure and
financial investments
Fixed assets acquired (net) (0.9) (0.4) (1.0)
Acquisitions
Pilot plant 0.0 (4.6) (4.6)
Darwin Molecular - expenses of 0.0 0.0 (1.8)
acquisition
Net cash acquired with Darwin 0.0 0.0 0.3
Molecular Corporation
Cash outflow before management
of liquid resources and (14.5) (10.8) (21.1)
financing
Financing
Shared issued, net of expenses 0.4 41.3 41.3
Change in net funds from (14.1) 30.5 20.2
cashflows
Current investments acquired 0.0 0.0 13.7
with subsidiary
Exchange gain 0.1 0.0 0.3
Movements in net funds in (14.0) 30.5 34.2
period
Net funds at start of period 51.4 17.2 17.2
Net funds at end of period 37.4 47.7 51.4
Change in cash in the period 0.1 0.3 0.2
Net transfers between cash and (14.1) 30.2 20.0
investments
Change in net funds from (14.0) 30.5 20.2
cashflows
Chiroscience Group plc
Notes to the Financial Statements
at 31 August 1997
1. BASIS OF PREPARATION
The financial information contained in this report has been prepared in
accordance with the accounting policies set out in the Group's Annual Report
for the year ended 28 February 1997, except for the adoption of UITF 17 as
described in note 6 below.
The financial information as set out in this report is unaudited and does not
comprise statutory accounts for the purposes of section 240 of the Companies
Act 1985. The auditors have carried out a review and their report is set out
on the next page.
The figures for the six months ended 31 August 1996 form part of the results
contained in the statutory accounts for the year ended 28 February 1997. The
information for the year to 28 February 1997 has been extracted from the same
statutory accounts, which carry an unqualified report and have been delivered
to the Registrar of Companies.
The Interim Report will be posted to shareholders on 7 October 1997. Copies
of the report will be available from the Company's registered office: 283
Cambridge Science Park, Milton Road, Cambridge CB4 4WE.
2. SEGMENTAL INFORMATION
6 months 6 months 12 months
to to to
31/8/97 31/8/96 28/2/97
#m's #m's #m's
Revenues by business
Darwin Discovery 3.3 0.8 2.3
ChiroTech 5.9 3.9 9.2
9.2 4.7 11.5
Operating profit/(loss) by
division
Darwin Discovery (16.4) (7.5) (20.4)
ChiroTech 2.3 0.2 1.2
(14.1) (7.3) (19.2)
Central activities (1.7) (1.3) (2.4)
Group operating loss (15.8) (8.6) (21.6)
3. LOSS PER SHARE
The loss per share is based on losses of #14.4m (31 August 1996: loss of #7.6m
and year to 28 February 1997: loss of #19.3m), and on 106.4m Ordinary Shares
(31 August 1996: 77.8m Ordinary Shares, and 28 February 1997: 85.4m Ordinary
Shares), being the weighted average number of shares in issue during the
period. The Directors do not recommend payment of a dividend.
4.RECONCILIATION OF OPERATING LOSS TO NET CASH OUTFLOW FROM OPERATING
ACTIVITIES
6 months 6 months 12 months
to to to
31/8/97 31/8/96 28/2/97
#m's #m's #m's
Operating loss (15.8) (8.6) (21.6)
Depreciation 1.5 0.8 2.2
Provision of free of charge (0.3) 0.0 (0.5)
services
Discount on share options 0.2 0.3 0.6
(note 6)
Movements in:
Stocks 0.0 0.9 0.7
Debtors (0.4) 0.1 (0.4)
Creditors (0.2) (0.4) 2.7
Net cash outflow from (15.0) (6.9) (16.3)
operating activities
5. FIXED ASSET INVESTMENTS
Represents the 2.6m shares held by the Chiroscience Employee Share Ownership
Plan at cost. The market value of the shares at 31 August 1997 was #7.5m.
6. CHANGE OF ACCOUNTING POLICY
In accordance with UITF 17 the financial statements now reflect an income
statement charge representing an appropriate proportion of the value of the
discount element of share options issued in prior years and the value of the
shares allocated under the long term incentive plan. The charge to the income
statement is offset by a credit to the reserves. The prior year figures have
been adjusted to reflect this change. The charges and adjustments are as
follows:
6 months 6 months 12 months
to to to
31/8/97 31/8/96 28/2/97
#m's #m's #m's
Charge to profit and loss (0.2) (0.3) (0.6)
Credit to reserves 0.2 0.3 0.6
7. RECOGNISED GAINS AND LOSSES
The only recognised gains or losses for the period other than the retained
loss as shown in the income statement, were foreign exchange gains on
translation of foreign currency investments. These gains amounted to #0.1m
for the six months to 31 August 1997 (six months to 31 August 1996: #nil, year
to 28 February 1997: #0.3m).
END
IR SDMFUSUWUFLU
Grafico Azioni Amedeo Res (LSE:AMED)
Storico
Da Giu 2024 a Lug 2024
Grafico Azioni Amedeo Res (LSE:AMED)
Storico
Da Lug 2023 a Lug 2024
