TIDMMTFB
RNS Number : 1746S
Motif Bio PLC
29 September 2017
September 29, 2017
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART
DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO
DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF SUCH JURISDICTION
The information contained within this announcement is deemed by
Motif Bio plc to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014. Upon the publication
of this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
Motif Bio plc and subsidiary
Interim Results
Half-Year 2017 Financial Results and Operational Progress
Motif Bio plc (AIM/ NASDAQ: MTFB), a clinical stage
biopharmaceutical company specializing in developing novel
antibiotics, announces financial results for the half-year ended
June 30, 2017.
Business Update
-- On April 18, 2017, we announced positive top-line results
from REVIVE-1, a global Phase 3 clinical trial of our
investigational drug candidate iclaprim in patients with acute
bacterial skin and skin structure infections ("ABSSSI"). Iclaprim
achieved the primary endpoint of non-inferiority (10% margin)
compared to vancomycin at the early time point, 48 to 72 hours
after start of study drug administration in the intent-to-treat
patient population. Given its differentiated mechanism, potency,
spectrum, safety and efficacy, iclaprim, if approved, could provide
a valuable new antibiotic treatment option. Iclaprim was well
tolerated in the study, with most adverse events categorized as
mild.
-- Our operational team and Board of Directors were strengthened
by the appointments of Robert Dickey IV as Chief Financial Officer
on January 17, 2017 and Dr. Craig T. Albanese, Chief Operating
Officer of the Morgan Stanley Children's Hospital, as a
non-executive director on May 5, 2017.
-- Three appointments were made to our Clinical Advisory Board:
Dr. Thomas Lodise, Dr. Thomas Holland and Dr. William O'Riordan.
These experts participated in our recent Investor and Analyst
Event, providing insight on ABSSSI, current treatments and
iclaprim's potential role in treating this serious skin
infection.
After the period end, we continued to make strong operational
and strategic progress:
-- On August 9, 2017, we announced that the last patient had
completed the treatment phase in REVIVE-2, the second Phase 3
clinical trial investigating the safety and efficacy of iclaprim in
patients with ABSSSI.
-- On September 15, 2017, we announced that the U.S. Food and
Drug Administration ("FDA") granted Orphan Drug Designation to
iclaprim for the treatment of Staphylococcus aureus lung infections
in patients with cystic fibrosis. This designation grants special
status to a drug or biologic under development to treat a rare
disease or condition and qualifies the sponsor of the product for
various development incentives, including tax credits for qualified
clinical testing, waiver of user fees and potentially up to seven
years of market exclusivity for the given indication, if
approved.
Top-line results from REVIVE-2, which uses an identical protocol
to REVIVE-1 but has different trial centres, are expected in the
fourth quarter of 2017. We believe that the successful completion
of the REVIVE-1 and REVIVE-2 Phase 3 trials satisfy both FDA and
European Medicines Agency ("EMA") requirements for regulatory
submission for an IV formulation of iclaprim in the treatment of
ABSSSI. We continue to anticipate submission of a New Drug
Application ("NDA") for iclaprim for the treatment of ABSSSI in the
United States in the first quarter of 2018 and a Marketing
Authorisation Application ("MAA") for iclaprim for the treatment of
ABSSSI in Europe in the first half of 2018.
Financial Highlights
-- On June 23, 2017, we raised US$23.7 million of net proceeds,
after deducting US$1.7 million of issuance costs, from a placement
in the United Kingdom of 66,666,667 new ordinary shares at 30 pence
per share.
-- At June 30, 2017 and December 31, 2016, we had cash and cash
equivalents of US$29.5 million and US$21.8 million, respectively.
At September 22, 2017, our cash and cash equivalents were $18.1
million.
-- Net loss for the six months ended June 30, 2017 and 2016 was
US$29.7 million and US$14.2 million, respectively.
Our strategy is focused on gaining approval for and
commercialising iclaprim for ABSSSI and the continued development
of iclaprim for additional indications to potentially broaden its
use as a safe and effective antibiotic. In this regard, we have
completed the necessary steps to initiate a Phase 3 clinical trial
of iclaprim for the treatment of hospital-acquired bacterial
pneumonia ("HABP"), including ventilator-associated bacterial
pneumonia ("VABP"). However, we will be required to raise
additional capital within the next year to commercialise and
further develop iclaprim and to continue to fund operations.
Graham Lumsden, Chief Executive Officer of Motif Bio plc, said:
"We have continued to deliver on time or ahead of expectations on
key milestones this year, including the release of positive
top-line data from the REVIVE-1 Phase 3 trial with iclaprim in
April and the completion of the treatment phase for the REVIVE-2
trial in August. We remain on track to announce the top-line
results from REVIVE-2 in the fourth quarter of this year and to
submit a New Drug Application to the FDA by the end of the first
quarter of next year. If the NDA is accepted by the FDA, we expect
that iclaprim will qualify for a priority review and a decision on
approval to market is anticipated to come by the end of 2018."
"The team has accomplished a tremendous amount in a little over
two years since our AIM IPO. We are now focused on the
pre-commercialisation activities to prepare for a potential launch
in 2019. The recent announcement of an orphan designation for
iclaprim in the treatment of Staphylococcus aureus pneumonia in
cystic fibrosis patients adds another potential indication where we
may be able to help patients in need of safe and effective
antibiotics in a life-threatening situation."
The person responsible for the release of this announcement on
behalf of Motif Bio plc is Robert Dickey IV, Chief Financial
Officer.
For further information please contact:
Motif Bio plc info@motifbio.com
Graham Lumsden (Chief Executive
Officer)
Robert Dickey IV (Chief Financial
Officer)
Peel Hunt LLP (NOMAD & BROKER) + 44 (0)20 7418 8900
Dr. Christopher Golden
Oliver Jackson
Northland Capital Partners
Limited (BROKER) +44 (0)203 861 6625
Patrick Claridge/ David Hignell
John Howes/ Rob Rees (Broking)
Walbrook PR Ltd. (FINANCIAL +44 (0) 20 7933 8780 or motifbio@walbrookpr.com
PR & IR)
Paul McManus Mob: +44 (0)7980 541 893
Mike Wort Mob: +44 (0)7900 608 002
MC Services AG (EUROPEAN IR) +49 (0)89 210 2280
Raimund Gabriel raimund.gabriel@mc-services.eu
The Trout Group (US IR) +1 (646 )378-2938
Michael Gibralter mgibralter@troutgroup.com
Lazar Partners (US PR) motiflp@lazarpartners.com
Chantal Beaudry +1 (646) 871-8480
Amy Wheeler +1 (646) 871-8486
About Motif Bio plc
Motif Bio plc is a clinical stage biopharmaceutical company
engaged in the research and development of novel antibiotics
designed to be effective against serious and life-threatening
infections in hospitalised patients caused by multi-drug resistant
bacteria. Further information is available at www.motifbio.com.
Forward-looking statements
This news release contains forward-looking statements that
reflect our current expectations regarding future events, including
statements regarding financial performance, the timing of clinical
trials, the relevance of our product candidates, and the clinical
benefits, safety profile, and commercial potential of iclaprim.
Forward-looking statements involve risks and uncertainties. Actual
events could differ materially from those projected herein and
depend on a number of factors, including (inter alia), the success
of our clinical development strategies, the successful and timely
completion of uncertainties related to the regulatory process, and
the acceptance of iclaprim and other products by consumer and
medical professionals. A further list and description of risks and
uncertainties associated with an investment in Motif Bio plc can be
found in our UK published Annual Report & Accounts and on Form
20-F, filed with the U.S. Securities and Exchange Commission on May
1, 2017. Existing and prospective investors are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date hereof. We undertake no obligation to
update or revise the information contained in this press release,
whether as a result of new information, future events or
circumstances or otherwise.
Management's Discussion and Analysis of Financial Condition and
Results of Operations
Overview
We are a clinical stage biopharmaceutical company engaged in the
research and development of novel antibiotics designed to be
effective against serious and life-threatening infections in
hospitalised patients caused by multi-drug resistant bacteria. The
discovery of new antibiotics has not kept pace with the increasing
incidence of resistant, difficult-to-treat bacteria. One of the
biggest threats of antibiotic resistance is from methicillin
resistant Staphylococcus aureus ("MRSA"), a leading cause of
hospital-acquired infections and a growing cause of infections in
healthy people in the general community. In 2013, the Centers for
Disease Control and Prevention reported that at least two million
people became infected with antibiotic-resistant bacteria and at
least 23,000 Americans died as a direct result of these infections.
Our lead product candidate, iclaprim, is being developed for the
treatment of ABSSSI and HABP, including VABP, infections which are
often caused by MRSA. We are currently conducting a global Phase 3
program (REVIVE) with an IV formulation of iclaprim, for the
treatment of ABSSSI.
Iclaprim is a novel diaminopyrimidine antibiotic that inhibits
an essential bacterial enzyme called "dihydrofolate reductase"
("DHFR"). Diaminopyrimidines are a class of chemical compounds that
inhibit different enzymes in the production of tetrahydrofolate, a
form of folic acid, which is required for the production of
bacterial DNA and RNA. The inhibition of DHFR represents a
differentiated and under-utilized mechanism of action compared with
other antibiotics. We acquired iclaprim from Nuprim Inc.
("Nuprim"), following the completion of our merger with Nuprim on
April 1, 2015. Arpida AG, or Arpida, one of the previous owners of
iclaprim, completed a comprehensive development programme for
iclaprim, including two Phase 3 trials in complicated skin and skin
structure infections. Iclaprim has been administered to more than
1,300 patients and healthy volunteers in Phase 1, 2 and 3 clinical
trials and in contrast to vancomycin, a standard of care antibiotic
in hospitalised patients with "Gram-positive" infections, no
evidence of nephrotoxicity (i.e., damage to the kidneys caused by
exposure to a toxic chemical, toxin or medication) has been
observed with iclaprim. Therapeutic drug monitoring and dosage
adjustment in patients with renal impairment may not be required
with iclaprim but this determination will ultimately be made by the
FDA, EMA and other regulatory bodies if and when the drug is
approved. "Gram-positive" or "Gram-negative" refer to how bacteria
react to the Gram stain test based on the outer casing of the
bacteria, and the bacteria's cell wall structure. Each type of
bacteria may be associated with different diseases. Iclaprim has
also demonstrated rapid bactericidal activity and a low propensity
for resistance development in vitro.
We believe that iclaprim is an attractive potential candidate
for use as a first-line empiric monotherapy, the initial therapy
administered in severely ill patients who are hospitalised with
ABSSSI and have comorbidities, or also suffer from other health
issues, such as renal impairment or diabetes. Renal impairment
affects up to an estimated 936,000 of the approximately 3.6 million
patients hospitalised with ABSSSI annually in the United
States.
During the period, we continued to advance the development of
our lead product candidate, iclaprim, and strengthened our
operational team as we look forward to announcing the top-line data
of our second Phase 3 study of iclaprim in patients with ABSSSI
later this year.
On January 17, 2017, we appointed Robert Dickey IV as Chief
Financial Officer. Mr. Dickey brings executive experience from
several private and public healthcare companies, including as Chief
Financial Officer at Tyme Technologies Inc., a NASDAQ-listed
clinical stage oncology company, and senior leadership positions at
NeoStem, Inc. (now known as Caladrius Biosciences Inc.), Hemispherx
Biopharma Inc., Stemcyte Inc., Locus Pharmaceuticals Inc. and
Protarga Inc. Mr. Dickey began his career as an investment banker
at Lehman Brothers and Legg Mason Wood Walker Inc.
On April 18, 2017, we announced positive topline results from
REVIVE-1, a global Phase 3 clinical trial of our investigational
drug candidate iclaprim in patients with ABSSSI. Iclaprim achieved
the primary endpoint of non-inferiority (10% margin) compared to
vancomycin at the early time point, 48 to 72 hours after start of
study drug administration in the intent-to-treat patient
population. Given its differentiated mechanism, potency, spectrum,
safety and efficacy, iclaprim, if approved, could provide a
valuable new antibiotic treatment option to offset the rising
problem of bacterial resistance. Iclaprim was well tolerated in the
study, with most adverse events categorised as mild.
On May 5, 2017, we appointed Dr. Craig Albanese to our board as
a non-executive director. Dr. Albanese is COO of the Morgan Stanley
Children's Hospital, part of the Columbia Presbyterian hospital
system in New York and one of the largest and most prestigious
health care organisations in the world.
On May 10, 2017, we added three members to our Clinical Advisory
Board with the appointment of Dr. Thomas Lodise, Dr. Thomas Holland
and Dr. William O'Riordan. The three new Clinical Advisory Board
members are medical and scientific leaders in their fields.
On June 23, 2017, we raised a total of GBP20.0 million (US$25.4
million) (before expenses) by placing 66,666,667 new ordinary
shares with new and existing institutional investors at a price of
30 pence per share. The net proceeds of the placing are being used
to finance the completion of the REVIVE-2 study, file a NDA and a
MAA for the approval of iclaprim for the treatment of ABSSSI in the
United States and Europe, respectively, as well as for general
corporate purposes.
After the period end we continued to make strong operational and
strategic progress:
On August 9, 2017, we announced that the last patient has
completed the treatment phase in REVIVE-2, the second Phase 3
clinical trial investigating the safety and efficacy of iclaprim in
patients with ABSSSI.
On September 15, 2017, we announced that the FDA granted Orphan
Drug Designation to iclaprim for the treatment of Staphylococcus
aureus lung infections in patients with cystic fibrosis. Orphan
designation grants special status to a drug or biologic under
development to treat a rare disease or condition and qualifies the
sponsor of the product for various development incentives,
including tax credits for qualified clinical testing, waiver of
user fees and potentially up to seven years of market exclusivity
for the given indication, if approved. Iclaprim has been studied in
an animal model of chronic pulmonary MRSA infection, which mimics
the pathophysiology observed in the lungs of patients with cystic
fibrosis.
Data from REVIVE-2, which uses an identical protocol to REVIVE-1
but has different trial centers, are expected in the fourth quarter
of 2017. We believe that the successful completion of the REVIVE-1
and REVIVE-2 Phase 3 trials satisfy both FDA and EMA requirements
for regulatory submission for an IV formulation of iclaprim in the
treatment of ABSSSI. We continue to anticipate submission of a NDA
in the first quarter of 2018 in the United States and an MAA in the
first half of 2018 in Europe for iclaprim for the treatment of
ABSSSI.
Our INSPIRE (Iclaprim for NoSocomial PneumonIa gRam- positive
pathogEns) Phase 3 clinical trial with iclaprim in patients with
HABP, including patients with VABP, will be initiated, if and when,
additional funding is available. This could further expand
iclaprim's addressable market to include another serious unmet
medical need. There are approximately 1.4 million patients
hospitalised annually in the United States with HABP, including
patients with VABP. We believe that iclaprim is well suited for use
as a first-line empiric therapy for patients with HABP, including
patients with VABP, caused by Gram-positive bacteria, based on data
from a Phase 2 clinical trial, which support the efficacy of
iclaprim in this patient population. Additionally, in a Phase 1
healthy volunteer trial, concentrations of iclaprim at the site of
infection in the lungs were considerably higher than concentrations
in plasma.
Outlook
As we await the outcome of REVIVE-2, we continue to refine our
commercialisation strategy for iclaprim, both through the
development of our go-to-market approach involving Medical
Scientific Liaisons and targeting the highest
antibiotic-prescribing hospitals, and leveraging the expertise of
our Clinical Advisory Panel and other experts to understand how
hospitals judge new products, including their expectations on data
that will be required to enable rapid formulary access. We have
submitted articles for publication in peer-reviewed scientific
journals and abstracts for presentation at key scientific
conferences, including Infection Diseases Week in October 2017, to
build awareness and understanding in the medical community of the
features and potential benefits of iclaprim. Whilst we continue to
exercise strict control of our financial resources, we believe all
of this preparatory work will allow us, if and when iclaprim is
approved, to clearly demonstrate the benefits of iclaprim to
patients, physicians and payers.
We expect that a positive outcome to REVIVE-2 would have a
meaningful impact on our ability to further discussions with
potential partners for certain territorial rights to iclaprim as we
remain focused on commercialisation of iclaprim in the United
States.
We remain on track with our strategic goals and expect to
perform in line with our expectations.
Results of Operations:
Comparison of the six months ended June 30, 2017 and June 30,
2016
During the preparation of these interim financial statements for
the six months ended June 30, 2017, we identified and corrected a
prior period error whereby stock based compensation expense was
understated primarily due to recognising expense only when an award
vested, not over the required service period using a graded vesting
approach as required under IFRS 2. We assessed the materiality of
the out-of-period adjustments on all impacted periods and
determined that they were not material to any of the periods and
that a restatement of previously issued financial statements was
not required. We concluded that the cumulative adjustment to
correct the error should be recorded in the six months ended June
30, 2017. The expense in fiscal years 2016, 2015 and 2014 was
understated by $802,282, $291,696 and $31,799, respectively. The
out-of-period correction increased General and Administrative
expense and Research and Development expense for the six months
ended June 30, 2017 by $762,836 and $362,941, respectively. None of
these adjustments had an impact on our cash resources.
General and Administrative Expenses
General and administrative expenses increased by US$2.5 million
to US$4.4 million in the six months ended June 30, 2017 from US$1.9
million in the six months ended June 30, 2016. This increase was
primarily attributable to (i) a US$1.3 million increase in
personnel related expenses, including stock based compensation
which was higher in the period partially due to the out-of-period
correction explained above and (ii) an increase of US$0.7 million
in the costs of outside professional services, including legal,
investor relations and other consulting services, primarily as a
result of our American Depository Shares ("ADS") being publicly
traded on the NASDAQ Capital Market since November 2016.
Research and Development Expenses
Research and development expenses increased by US$11.8 million
to US$23.8 million in the six months ended June 30, 2017 from
US$12.0 million in the six months ended June 30, 2016. This
increase was primarily attributable to the continuation of iclaprim
clinical development, including a US$10.5 million increase related
to contract research organisation ("CRO") expenses, including
milestone payments of approximately US$2.0 million. There was also
an increase in personnel related expenses, including a US$0.5
million increase in stock based compensation expense.
Interest income and Interest expense
Interest income was US$52 thousand for the six months ended June
30, 2017, compared to US$43 thousand for the six months ended June
30, 2016. Interest income is earned based on cash holdings during
the period. Interest expense was US$126 thousand for the six months
ended June 30, 2016 due to interest on outstanding notes that were
converted to equity securities in December 2016. There was no
outstanding debt or interest expense during the six months ended
June 30, 2017.
Loss from revaluation of derivative liabilities
In November 2016, warrants were issued that are classified as a
liability due to a potential variability in the number of shares
that may be issued upon exercise if an effective registration
statement is not maintained. This liability is carried at fair
value and is re-measured each reporting period using the
Black-Scholes option pricing model. The increase in the fair value
of the warrant liability during the six months ended June 30, 2017
was primarily attributable to an increase in our stock price. No
such warrants were outstanding prior to November 2016 and therefore
no such liability existed.
Net Foreign Exchange Loss
The net foreign exchange loss for the six months ended June 30,
2017 was US$0.1 million, compared to a loss of US$0.2 million in
the six months ended June 30, 2016. In 2017, the loss recognised
relates primarily to the foreign exchange impact on the revaluation
of the derivative liability that has an exercise price in Pounds
Sterling.
Liquidity and Capital Resources
At June 30, 2017 and December 31, 2016, we had cash and cash
equivalents of approximately US$29.5 million and US$21.8 million,
respectively.
We do not expect to generate significant revenue unless and
until we obtain regulatory approval for and commercialise our
current or any future product candidates. We anticipate that we
will continue to generate losses for the foreseeable future, and we
expect our losses to continue as we develop and seek regulatory
approvals for our product candidates and begin to commercialise any
approved products. We are subject to all of the risks applicable to
the development of new drugs, and we may encounter unforeseen
expenses, difficulties, complications, delays and other unknown
factors that may harm our business.
Our operations have been financed primarily by net proceeds from
the issuance of ADSs on the NASDAQ Capital Market, the issuance of
ordinary shares on AIM, and the issuance of convertible promissory
notes to related parties. Our primary uses of capital are, and we
expect will continue, at least in the short term, to be,
third-party expenses associated with the planning and conduct of
preclinical and clinical trials, costs of process development
services and manufacturing of our product candidates, and
compensation-related expenses.
Cash used to fund operating expenses is affected by the timing
of when we pay expenses, as reflected in the change in our
outstanding accounts payable and accrued expenses.
Our future funding requirements will depend on many factors,
which may include the following:
-- the scope, rate of progress, results and cost of our
preclinical studies and clinical trials and other related
activities;
-- the cost of formulation, development, manufacturing of
clinical supplies and establishing commercial supplies of our
product candidates and any other product candidates that we may
develop, in-license or acquire;
-- the cost, timing and outcomes of pursuing regulatory approvals;
-- the cost and timing of establishing administrative, sales,
marketing and distribution capabilities;
-- the terms and timing of any collaborative, licensing and
other arrangements that we may establish, including any required
milestone and royalty payments thereunder; and
-- the emergence of competing technologies and their achieving
commercial success before we do or other adverse market
developments.
We expect to continue to incur losses. Our ability to achieve
and maintain profitability depends upon the successful development,
regulatory approval and commercialisation of our product candidates
and achieving a level of revenues adequate to support our cost
structure. Accordingly, we will be required to raise additional
capital within the next year to continue the development and
commercialisation of current product candidates and to continue to
fund operations at the current cash expenditure levels, including
our REVIVE-2 trials and our plans to conduct our INSPIRE Phase 3
clinical trial of iclaprim in HABP, including VABP, patients. We
cannot be certain that additional funding will be available on
acceptable terms, or at all. To the extent that we raise additional
funds by issuing equity securities, our stockholders may experience
significant dilution. Any debt financing, if available, may involve
restrictive covenants that impact our ability to conduct business.
If we are unable to raise additional capital when required or on
acceptable terms, we may have to (i) significantly delay, scale
back or discontinue the development and/or commercialisation of one
or more product candidates; (ii) seek collaborators for product
candidates at an earlier stage than otherwise would be desirable
and on terms that are less favorable than might otherwise be
available; or (iii) relinquish or otherwise dispose of rights to
technologies, product candidates or products that we would
otherwise seek to develop or commercialise ourselves on unfavorable
terms.
Cash Flows
Six months ended
-------------------------------
June 30, 2017 June 30, 2016
--------------- --------------
US$ US$
Net cash (used in) / provided by:
Operating activities (16,486,341) (8,888,549)
Financing activities 24,124,357 (770)
Effect of exchange rate changes on
cash and cash equivalents 33,860 (197,814)
7,671,876 (9,087,133)
=============== ==============
Operating Activities
Net cash used in operating activities was US$16.5 million in the
six months ended June 30, 2017, which reflects the continuation of
the clinical development of iclaprim and meeting certain
milestones, including payments of US$11.3 million to our CRO. Net
cash used in operating activities was US$8.9 million for the six
months ended June 30, 2016, which primarily reflects the clinical
development of iclaprim.
Financing Activities
Net cash provided by financing activities amounted to US$24.1
million in the six months ended June 30, 2017, primarily due to net
proceeds of US$23.7 million from the June 23, 2017 placement of
66,666,667 new ordinary shares at 30 pence per share and proceeds
of US$0.3 million from the exercise of warrants and share options
during the six months ended June 30, 2017.
Financial Statements
Motif Bio plc
Unaudited interim condensed consolidated statements of comprehensive loss
For the six months June 30, 2017 and 2016
For the six months ended
June 30,
--------------------------------------------------
Note 2017 2016
-------- ------------------------- -------------------
US $ US $
Operations
General and administrative expenses 2 (4,430,467) (1,927,434)
Research and development expenses 2 (23,791,210) (12,026,721)
Gains on settlement of contract disputes - 83,320
Operating loss (28,221,677) (13,870,835)
Interest income 3 52,197 42,872
Interest expense 3 - (125,738)
Loss from revaluation of derivative
liabilities 9 (1,427,490) -
Net foreign exchange loss (115,610) (197,814)
Loss before income taxes (29,712,580) (14,151,515)
Income tax 4 - -
Net loss for the period (29,712,580) (14,151,515)
------------------------- -------------------
Total comprehensive loss for the period (29,712,580) (14,151,515)
========================= ===================
Loss per share for loss from operations attributable
to the ordinary equity holders of the
company: 5
Basic and diluted loss per share (0.15) (0.13)
------------------------- -------------------
The accompanying footnotes are an integral part of these
condensed consolidated interim financial statements.
Motif Bio plc
Unaudited interim condensed consolidated statements
of financial position
At June 30, 2017 and December 31,
2016
At June 30, At December 31,
Note 2017 2016
----- ------------------------- -------------------------------
US $ US $
ASSETS
Non-current assets
Intangible assets 6,195,748 6,195,748
Other non-current assets 20,875 -
Total non-current assets 6,216,623 6,195,748
------------------------- -------------------------------
Current assets
Prepaid expenses and other current
assets 396,242 401,064
Cash 29,501,508 21,829,632
Total current assets 29,897,750 22,230,696
------------------------- -------------------------------
Total assets 36,114,373 28,426,444
========================= ===============================
LIABILITIES
Current liabilities
Trade and other payables 6 22,938,734 12,319,117
Derivative Liability 9 7,153,601 5,798,058
Payable on completion of clinical
trial 6 500,000 500,000
Total current liabilities 30,592,335 18,617,175
------------------------- -------------------------------
Total liabilities 30,592,335 18,617,175
========================= ===============================
Net assets 5,522,038 9,809,269
========================= ===============================
EQUITY
Share capital 8 3,584,062 2,728,199
Share premium 8 80,597,581 57,348,694
Group reorganization reserve 8 9,938,362 9,938,362
Accumulated deficit 8 (88,597,967) (60,205,986)
Total equity 5,522,038 9,809,269
========================= ===============================
The accompanying footnotes are an integral part of these
condensed consolidated interim financial statements.
Motif Bio plc
Unaudited interim condensed consolidated statements of changes in equity
For the six months ended June 30, 2017 and 2016
Group
Share Share reorganisation Accumulated
capital premium reserve deficit Total
US $ US $ US $ US $ US $
------------------ ------------------- ------------------------------- ---------------------- ---------------------
Balance at
December 31,
2015 1,645,291 38,534,280 9,938,362 (20,395,225) 29,722,708
Loss for the
period - - - (14,151,515) (14,151,515)
------------------ ------------------- ------------------------------- ---------------------- ---------------------
Total
comprehensive
loss for the
period - - - (14,151,515) (14,151,515)
Cost of
issuance - (457,316) - - (457,316)
Share-based
payments - - - 7,298 7,298
------------------ ------------------- ------------------------------- ---------------------- ---------------------
Balance at
June 30, 2016 1,645,291 38,076,964 9,938,362 (34,539,442) 15,121,175
================== =================== =============================== ====================== =====================
Balance at
December 31,
2016 2,728,199 57,348,694 9,938,362 (60,205,986) 9,809,269
Loss for the
period - - - (29,712,580) (29,712,580)
------------------ ------------------- ------------------------------- ---------------------- ---------------------
Total
comprehensive
loss for the
period - - - (29,712,580) (29,712,580)
Issue of share
capital, net
of cost of
issuance 846,667 22,835,072 - - 23,681,739
Exercise of
share options
and warrants 9,196 413,815 - - 423,011
Share-based
payments - - - 1,320,599 1,320,599
------------------ ------------------- ------------------------------- ---------------------- ---------------------
Balance at
June 30, 2017 3,584,062 80,597,581 9,938,362 (88,597,967) 5,522,038
================== =================== =============================== ====================== =====================
The accompanying footnotes are an integral part of these
condensed consolidated interim financial statements.
Motif Bio plc
Unaudited interim condensed consolidated statements
of cash flows
For the six months June 30, 2017 and
2016
Six months ended
June 30,
-----------------------------------------------
2017 2016
----------------- ----------------------------
US $ US $
Operating activities
Operating loss for the period (28,221,677) (13,870,835)
Adjustments to reconcile net loss to
net cash used in activities:
Share-based payments 1,320,599 7,298
Gains on settlement of contract disputes - (83,320)
Interest income - 42,872
Changes in operating assets and liabilities:
Prepaid expenses and other current assets (16,053) 56,799
Trade and other payables 10,430,790 4,958,637
----------------- ----------------------------
Net cash used in operating activities (16,486,341) (8,888,549)
----------------- ----------------------------
Financing activities
Proceeds from issue of share capital,
net of issuance costs 23,870,567 -
Proceeds from exercise of warrants 253,790 -
Interest paid - (770)
----------------- ----------------------------
Net cash provided by (used in) financing
activities 24,124,357 (770)
----------------- ----------------------------
Net change in cash 7,638,016 (8,889,319)
Cash beginning of the period 21,829,632 28,594,347
Effect of foreign exchange rate changes 33,860 (197,814)
----------------- ----------------------------
Cash, end of the period 29,501,508 19,507,214
================= ============================
The accompanying footnotes are an integral part of these
condensed consolidated interim financial statements.
1. General information and basis of preparation
These unaudited interim condensed consolidated financial
statements for the six months ended June 30, 2017 together with the
notes thereto (the "Unaudited Interim Condensed Consolidated
Financial Statements") of Motif Bio plc (the "Company" and together
with its subsidiary, Motif BioSciences Inc. the "Group") have been
prepared in accordance with International Financial Reporting
Standards ("IFRS") as issued by the International Accounting
Standards Board ("IASB") and as adopted by the European Union. As
permitted by International Accounting Standard 34 - "Interim
financial reporting" ("IAS 34"), the Unaudited Interim Condensed
Consolidated Financial Statements do not include all disclosures
required for a full presentation and do not constitute statutory
financial statements. The Unaudited Interim Condensed Consolidated
Financial Statements should be read in conjunction with the Motif
Bio plc Annual Consolidated Financial Statements for the years
ended December 31, 2016 and 2015, which have been prepared in
conformity with IFRS and as adopted by the European Union. The
Unaudited Interim Condensed Consolidated Financial Statements were
approved for issuance by the Board of Directors on September 27,
2017.
The preparation of financial statements in conformity with IFRS
requires the use of estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the
financial information and the reported amounts of revenue and
expenses during the period. Although these estimates are based on
management's best knowledge of the amount, event or actions, actual
results ultimately may differ from those estimates. Reference
should be made to the section "Critical Accounting Policies and
Significant Judgments and Estimates" in the Annual Consolidated
Financial Statements for the years ended December 31, 2016, 2015
and 2014 for a detailed description of the accounting policies and
more significant estimates and judgments used by the Group. The
accounting policies adopted in the preparation of these financial
statements are consistent with those presented in the Group's 2016
Annual Consolidated Financial Statements. These financial
statements have been reviewed by PricewaterhouseCoopers LLP and
have not been audited.
Items included in the financial statements of each of the
Group's entities are measured using the currency of the primary
economic environment in which the entity operates ("the functional
currency"). The Unaudited Interim Condensed Consolidated Financial
Statements are presented in United States Dollars (US $), which is
Motif Bio plc's functional and presentation currency. However,
during the reporting period the Company had exposure to Pounds
Sterling. Foreign currency transactions are translated into the
functional currency using the exchange rates at the dates of the
transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation of
monetary assets and liabilities denominated in foreign currencies
at period end exchange rates are generally recognized in profit or
loss.
Going Concern
As of June 30, 2017, the Group had US$29.5 million in cash. Net
cash used in operating activities was US$16.5 million for the six
months ended June 30, 2017. Net loss for the six months ended June
30, 2017 was US$29.7 million. The Group expects to incur losses for
the next several years as it expands its research, development and
clinical trials of iclaprim. The Group is unable to predict the
extent of any future losses or when the Group will become
profitable, if at all.
The Group will be required to raise additional capital within
the next year to continue the development and commercialization of
current product candidates and to continue to fund operations at
the current cash expenditure levels. The Group cannot be certain
that additional funding will be available on acceptable terms, or
at all. To the extent that the Group raises additional funds by
issuing equity securities, its stockholders may experience
significant dilution. Any debt financing, if available, may involve
restrictive covenants that impact the Group's ability to conduct
business. If the Group is unable to raise additional capital when
required or on acceptable terms, it may have to (i) significantly
delay, scale back or discontinue the development and/or
commercialization of one or more product candidates; (ii) seek
collaborators for product candidates at an earlier stage than
otherwise would be desirable and on terms that are less favorable
than might otherwise be available; or (iii) relinquish or otherwise
dispose of rights to technologies, product candidates or products
that the Group would otherwise seek to develop or commercialise
itself on unfavorable terms.
These financial statements have been prepared under the
assumption that the Group will continue as a going concern. Due to
the Group's recurring and expected continuing losses from
operations, as well as significant amounts of outstanding payables
and accrued expenses, the Group has concluded there is substantial
doubt in the Group's ability to continue as a going concern within
one year of the issuance of these financial statements without
additional capital becoming available. The financial statements do
not include any adjustments that might result from the outcome of
this uncertainty.
On April 18, 2017, the Group announced positive topline results
from REVIVE-1, its global Phase 3 clinical trial in patients with
ABSSSI. Iclaprim achieved the primary endpoint of non-inferiority
at the early time point after start of study drug administration.
Iclaprim was well tolerated in the study, with most adverse events
categorized as mild. The Group believes that this new data and the
fact that REVIVE-2, the second Phase 3 trial, uses an identical
protocol to REVIVE-1 but has different trial centers, could provide
the basis for increased investor interest in the Group and, hence,
potentially provide greater opportunities to raise additional
capital.
Segment Information
The chief operating decision-maker is considered to be the Board
of Directors of Motif Bio plc. The chief operating decision maker
allocates resources and assesses performance of the business and
other activities at the operating segment level. In addition, they
review the IFRS consolidated financial statements.
The chief operating decision-maker has determined that the Motif
has one operating segment-the development and commercialisation of
pharmaceutical formulations. The Group maintains space and has some
activities in the U.K., however, the finance and most other
management functions take place in the U.S.
Fair value disclosures
The Group's cash, prepaid expenses and other current assets and
trade and other payables are stated at their respective historical
carrying amounts, which approximates fair value due to their
short-term nature. These are measured at fair value using Level 1
inputs. The Group's derivative liability is measured at fair value
using Level 3 inputs. See discussion in Note 9 on the inputs
utilized in the Black-Scholes option pricing model and for a roll
forward of the derivative liability from December 31, 2016 to June
30, 2017. There were no transfers between fair value levels during
the six months ended June 30, 2017 or 2016.
There were no non-recurring fair value measurements for the six
months ended June 30, 2017 or 2016.
When measuring the fair value of an asset or a liability, the
Group uses observable market data as far as possible. Fair values
are categorized into different levels in a fair value hierarchy
based on the inputs used in the valuation techniques as
follows:
-- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
-- Level 2: inputs other than quoted prices included in Level 1
that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices).
-- Level 3: inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
2. Breakdown of expenses by nature
Six months ended
June 30, June 30,
2017 2016
------------------- -------------
US $ US $
General and administrative expenses
Employee benefits expenses 1,773,845 422,667
Directors' fees 309,467 217,914
Legal, professional and advisory fees 1,820,934 1,104,282
Other expenses 526,221 182,571
4,430,467 1,927,434
------------------- -------------
Research and developments costs 23,791,210 12,026,721
------------------- -------------
Gains on settlement of contract disputes - (83,320)
------------------- -------------
3. Finance income and costs
Six months ended
June 30, June 30,
2017 2016
------------- -------------
US $ US $
Finance income
Interest from financial assets 52,197 42,872
52,197 42,872
------------- -------------
Finance costs
Interest paid/payable for financial liabilities - (125,738)
- (125,738)
------------- -------------
4. Income tax expense
The Group has recorded a loss for the six months ended June 30,
2017 and does not expect to owe any income taxes based on this.
5. Loss per share
Basic loss per share is calculated by dividing the loss
attributable to equity holders of the Company by the weighted
average number of shares in issue during the period. In accordance
with IAS 33, where the Group has reported a loss for the period,
the shares are anti-dilutive.
Six months ended
June 30, June 30,
2017 2016
------------------- -------------------
US $ US $
Net loss (29,712,580) (14,151,515)
Basic and diluted weighted average shares
in issue 199,299,910 108,601,496
Basic and diluted loss per share (0.15) (0.13)
=================== ===================
The following potentially dilutive securities outstanding at
June 30, 2017 and 2016 have been excluded from the computation of
diluted weighted average shares outstanding, as they would be
antidilutive.
Six months ended
2017 2016
----------------- -------------
(in shares) (in shares)
Convertible promissory notes - 14,510,770
Warrants 47,537,905 5,932,675
Share options 18,398,299 7,352,232
65,936,204 27,795,677
================= =============
6. Trade and other payables
At June 30, At December
2017 31, 2016
---------------------------- ---------------------------------
US $ US $
Trade payables 4,742,272 734,405
Accrued expenses 18,179,871 11,582,478
Amounts due to affiliates 16,591 78
Other Payable - 2,156
Payable on completion of clinical
trial 500,000 500,000
23,438,734 12,819,117
============================ =================================
The accrued expense balance at June 30, 2017 consists primarily
of amounts owed to the Company's contract research organisation.
These amounts are due throughout the remainder of 2017 and into
2018, with the timing of certain payments due when various
milestones are met.
The payable on completion of clinical trial is a milestone
payment to be paid by Motif BioSciences Inc. to Acino Pharma AG
upon completion of the first Phase III clinical trial using the
iclaprim assets that were acquired from Acino Pharma AG.
7. Other interest bearing loans and borrowings
On September 7, 2016, the Group amended and restated the
convertible notes with Amphion Innovations plc and Amphion
Innovations US Inc. to provide that any outstanding principal under
the notes as of the maturity date will be paid to the holders on
the maturity date, at the Group's election, through the issuance of
(i) a number of our ordinary shares, based on the conversion price
set forth in the notes, or (ii) a number of ADSs, which is equal to
a number determined by dividing the number of ordinary shares the
holder would otherwise be entitled to by the then applicable ADS to
ordinary share ratio. The amended and restated convertible
promissory notes also provide that except in the event of a
default, no interest will accrue or be payable with respect to the
amounts due under notes. In consideration for its agreement to
forego interest payments under its convertible promissory notes,
the Group issued 409,000 ordinary shares to Amphion Innovations
plc. The amended and restated notes also permit the Group or the
holders to convert all or any portion of the outstanding principal
under the notes into ordinary shares or ADSs (as determined by the
Group) at any time prior to the maturity date.
In December 2016, the notes, which totaled US$3,550,786, were
converted into 14,510,770 new ordinary shares in the Company at the
rate of US$0.2447 per share.
8. Equity and warrants to purchase shares
Allotted, called up, and fully paid: Number US $
--------------------------- ------------------------------
In issue at December 31, 2016 195,741,528 2,728,199
In issue at June 30, 2017 262,878,775 3,584,062
On June 23, 2017, the Group placed 66,666,667 new ordinary
shares at 30 pence per share and received US$23,681,739 of net
proceeds.
Share premium represents the excess over nominal value of the
fair value consideration received for equity shares, net of
expenses of the share issue. Retained deficit represents
accumulated losses.
The group reorganization reserve arose in March 2015 when Motif
Bio plc became the parent of the Group. This was a common control
transaction and therefore outside the scope of IFRS 3-"Business
Combinations." The transaction has therefore been accounted for as
a group reorganization and the Group is presented as if the Company
has always owned Motif BioSciences Inc. The reserve on
consolidation represents the difference between the nominal value
of the shares of the Company issued to the former stockholders of
Motif BioSciences Inc. and the share capital and share premium of
Motif BioSciences Inc. at the date of the transaction. As stated,
the nominal value of the Company shares was used in the calculation
of the reorganization reserve.
Warrant activity
The Company has issued warrants for services performed and in
conjunction with various equity financings. The Company's warrants
have either a Pounds Sterling or US Dollar exercise price. See Note
9 for additional information on the Company's liability classified
warrants. The following is a summary of the Company's warrant
activity during the six months ended June 30, 2017:
Weighted Average
Number of Warrants Exercise Price
----------------------- --------------------
GBP US$ GBP US$
----------- ---------- ------------- -----
Outstanding as of January 1, 2017 23,313,220 24,801,565 GBP 0.278 $7.90
Granted - - - -
Exercised (250,000) (326,880) 0.322 8.03
---------- ---------- ---- ------- ----
Outstanding as of June 30, 2017 23,063,220 24,474,685 GBP 0.278 $7.90
========== ========== ==== ======= ====
The Company's warrants outstanding and exercisable as of June
30, 2017 were as follows:
Number of Warrants Outstanding Exercise Price Expiration Date
------------------------------ -------------- -----------------
416,645 US $0.56 December 31, 2017
1,367,089 GBP GBP0.20 April 2, 2020
1,082,384 GBP GBP0.50 July 21, 2020
11,181,714 GBP GBP0.322 November 23,2021
24,058,040 US $8.03 November 23,2021
9,432,033 GBP GBP0.20 April 2, 2025
9. Derivative liability
On November 23, 2016, the Group closed an initial U.S. public
offering of 2,438,491 American Depositary Shares ("ADS") and
1,219,246 warrants to purchase ADS at a price of US $6.98 per
ADS/Warrant combination. Each ADS represents 20 ordinary shares.
The warrants have an exercise price of US $8.03 per ADS and expire
on November 23, 2021. In the event the Group fails to maintain the
effectiveness of its Registration Statement and if a Restrictive
Legend Event has occurred, the warrant shall only be exercisable on
a cashless basis. This would result in variability in the number of
shares issued and therefore, the warrants were designated as a
financial liability carried at fair value through profit and loss.
On issuance of the ADS warrants, the Group recorded a derivative
liability of US $3,849,160 using the Black-Scholes model. The Group
develops its own assumptions for use in the Black-Scholes option
pricing model that do not have observable inputs or available
market data to support the fair value. This method of valuation
involves using inputs such as the fair value of the Group's common
stock, stock price volatility of comparable companies, the
contractual term of the warrants, risk free interest rates and
dividend yields. The Group has a limited trading history in its
common stock, therefore, expected volatility is based on that of
reasonably similar publicly traded companies. Due to the nature of
these inputs, the valuation of the warrants is considered a Level 3
measurement.
At June 30, 2017, the derivative liability had a fair value of
US $4,781,793 using the Black-Scholes model and the following
assumptions:
June 30,
2017
----------
Share price (US $) $ 7.42
Expected volatility 69.6%
Number of periods to exercise 4.4 years
Risk free rate 1.89%
Expected dividends -
Liability classified - US offering warrants # of warrants (assuming exercise to ordinary shares US$
--------------------------------------------------- ---------
Beginning balance - January 1, 2017 24,384,920 $3,967,189
Warrant exercise (326,880) (108,743)
Loss on revaluation of derivative liability - 923,347
Balance at June 30, 2017 24,058,040 $4,781,793
--------------------------------------------------- ---------
In addition, on November 23, 2016, the Group placed 22,863,428
ordinary shares together with 11,431,714 warrants over ordinary
shares at a price of 28 pence per share/warrant combination. The
warrants have an exercise price of GBP0.322 per warrant and expire
on November 23, 2021. In the event that the Group fails to maintain
the effectiveness of the Registration Statement, the warrant shall
only be exercisable on a cashless basis. This would result in
variability in the number of shares issued and therefore, the
warrants were designated as a financial liability carried at fair
value through profit and loss. On issuance of the warrants, the
Group recorded a derivative liability of US $1,812,959 using the
Black-Scholes model.
At June 30, 2017, the derivative liability has a fair value of
US $2,371,808 using the Black-Scholes model and the following
assumptions:
June 30,
2017
Share price (GBP) GBP 0.303
Expected volatility 69.6%
Number of periods to exercise 4.4 years
Risk free rate 1.89%
Expected dividends -
Liability classified - UK offering warrants # of warrants US$
------------- ---------
Beginning balance - January 1, 2017 11,431,714 $1,830,869
Warrant exercise (250,000) (60,478)
Loss on revaluation of derivative liability - 504,143
FX impact - 97,274
------------- ---------
Balance at June 30, 2017 11,181,714 $2,371,808
------------- ---------
10. Share based payments
The total expense recognised arising from stock-based payments
are as follows:
Six months ended
June 30, 2017 June 30, 2016
US $ US $
Share based payment expense - R&D expense $ 496,603 $ -
Share based payment expense - General and administrative expense 823,996 7,298
---------------- -------------------------
Total 1,320,599 7,298
---------------- -------------------------
During the preparation of these interim financial statements for
the six months ended June 30, 2017, the Group identified and
corrected a prior period error whereby stock based compensation
expense was understated primarily due to recognizing expense only
when an award vested, not over the required service period using a
graded vesting approach as required under IFRS 2. The Group
assessed the materiality of the out-of-period adjustments on all
impacted periods and determined that they were not material to any
of the periods and that a restatement of previously issued
financial statements was not required. The Group concluded that the
cumulative adjustment to correct the error should be recorded in
the six months ended June 30, 2017.
The expense in fiscal years 2016, 2015 and 2014 was understated
by $802,282, $291,696 and $31,799, respectively. The out-of-period
correction increased General and Administrative expense and
Research and Development expense for the six months ended June 30,
2017 by $762,836 and $362,941, respectively. None of these
adjustments had an impact on the cash resources of the Group.
11. Related party transactions
Transactions with Amphion Innovations plc and Amphion
Innovations US, Inc.
At June 30, 2017, Amphion Innovations plc owned 16.45% of the
issued ordinary shares in Motif Bio plc. In addition, the Amphion
Group has provided funding for the activities of Motif BioSciences
Inc. through the issue of convertible interest bearing loan notes,
which were converted to shares in December 2016, as discussed
further in Note 7. Richard Morgan and Robert Bertoldi were
directors of both the Company and Amphion Innovations plc in the
period. Transactions between the Group and the Amphion Group are
disclosed below:
At December
At June 30, 31,
2017 2016
--------------------------------- ------------------------------
US $ US $
Amounts due to Amphion Innovations
US, Inc. 16,591 78
Six months ended June 30,
----------------------------------------------------
2017 2016
------------------------------- ------------------
US $ US $
Interest expense - 124,968
Advisory And Consultancy Agreement With Amphion Innovations US,
Inc. And Shared Office Space
On April 1, 2015, the Group entered into an Advisory and
Consultancy Agreement with Amphion Innovations US, Inc. The
consideration for the services to be provided is $120,000 per
annum. The agreement was amended in December 2016 so that either
party may terminate the agreement at any time, for any reason, upon
giving the other party ninety days advance written notice. The
Group paid US$60,000 to Amphion Innovations US, Inc. during the six
months ended June 30, 2017 and 2016 in accordance with the terms of
the agreement. Amphion Innovations US, Inc. also bills the Group on
a pass-through rate for office space, shared workspace and other
expenses that Amphion Innovations US, Inc. pays on behalf of the
Group. These costs were $45,536 for the six months ended June 30,
2017.
Consultancy Agreement With Amphion Innovations plc
On April 1, 2015, the Group entered into a Consultancy Agreement
with Amphion Innovations plc for the services of Robert Bertoldi,
an employee of Amphion Innovations plc. The consideration for his
services was $5,000 per month. On November 1, 2015, the
consideration was increased to $180,000 per annum. On July 1, 2016,
the consideration decreased to US $75,000 per annum. The agreement
was for an initial period of 12 months and would automatically
renew each year on the anniversary date unless either party
notifies the other by giving 90 days written notice prior to
expiration. The agreement was amended in December 2016 so that
either party may terminate the agreement at any time, for any
reason, upon giving the other party ninety days advance written
notice. The Group paid Robert Bertoldi US$37,500 and $90,000 during
the six months ended June 30, 2017 and 2016 in accordance with the
terms of the agreement.
In July 2017, the Group amended the consulting agreement with
Amphion Innovations plc to increase the annual consideration to
US$125,000 to better reflect Robert Bertoldi's time commitment to
the Group.
Consultancy Agreement With Amphion Innovations US, Inc.
On September 7, 2016, the Group entered into a Consultancy
Agreement with Amphion Innovations US, Inc., pursuant to which
Amphion Innovations US, Inc. will provide consultancy services in
relation to the Group's obligations as a NASDAQ listed company. The
consideration for the services is $15,500 per month. The agreement
is for an initial period of 12 months, after which the agreement
will terminate automatically unless renewed by the parties by
mutual agreement. The Group paid US$93,000 during the six months
ended June 30, 2017 pursuant to the terms of this agreement.
Consultancy Agreement With Jonathan Gold
On April 7, 2017, the Group entered into a new consultancy
agreement with Jonathan Gold, a member of the Group's Board of
Directors. Under the terms of this agreement, Mr. Gold received a
fixed fee of $16,167 per month for strategic financial expert
advice and guidance. The term of this agreement was twelve months,
commencing January 1, 2017. The term of the agreement would
automatically renew each month following the initial term, as long
as either party did not provide notice to the other party of its
election not to continue to renew the agreement with at least 30
days advance notice. The Group paid US$97,002 during the six months
ended June 30, 2017 pursuant to the terms of this agreement.
Independent review report to Motif Bio plc
Report on the interim condensed consolidated financial
statements
Our conclusion
We have reviewed Motif Bio plc's interim condensed consolidated
financial statements (the "interim financial statements") in the
Interim Results of Motif Bio plc for the 6 month period ended 30
June 2017. Based on our review, nothing has come to our attention
that causes us to believe that the interim financial statements are
not prepared, in all material respects, in accordance with
International Accounting Standard 34, 'Interim Financial
Reporting', as adopted by the European Union and the AIM Rules for
Companies.
Emphasis of matter
Without modifying our conclusion on the interim financial
statements, we have considered the adequacy of the disclosure made
in note 1 to the interim condensed consolidated financial
statements concerning the Group's ability to continue as a going
concern. The Group has suffered recurring losses and negative cash
flows as a result of the continuing clinical trials and will
require additional financing to fund ongoing operations. These
conditions, along with the other matters explained in note 1 to the
interim condensed consolidated financial statements, indicate the
existence of a material uncertainty which may cast significant
doubt over the Group's ability to continue as a going concern. The
Group's interim condensed consolidated financial statements do not
include the adjustments that would result if the group was unable
to continue as a going concern.
What we have reviewed
The interim financial statements comprise:
the unaudited interim condensed consolidated statements of
financial position as at 30 June 2017;
the unaudited interim condensed consolidated statements of loss
and comprehensive loss for the period then ended;
the unaudited interim condensed consolidated statements of cash
flows for the period then ended;
the unaudited interim condensed consolidated statements of
changes in equity for the period then ended; and
the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim Results
have been prepared in accordance with International Accounting
Standard 34, 'Interim Financial Reporting', as adopted by the
European Union and the AIM Rules for Companies.
As disclosed in note 1 to the interim financial statements, the
financial reporting framework that has been applied in the
preparation of the full annual financial statements of the Group is
applicable law and International Financial Reporting Standards
(IFRSs) as adopted by the European Union.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the directors
The Interim Results, including the interim financial statements,
are the responsibility of, and have been approved by, the
directors. The directors are responsible for preparing the Interim
Results in accordance with the AIM Rules for Companies which
require that the financial information must be presented and
prepared in a form consistent with that which will be adopted in
the company's annual financial statements.
Our responsibility is to express a conclusion on the interim
financial statements in the Interim Results based on our review.
This report, including the conclusion, has been prepared for and
only for the company for the purpose of complying with the AIM
Rules for Companies and for no other purpose. We do not, in giving
this conclusion, accept or assume responsibility for any other
purpose or to any other person to whom this report is shown or into
whose hands it may come save where expressly agreed by our prior
consent in writing.
What a review of interim financial statements involves
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, 'Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity' issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK) and,
consequently, does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the half-year
2017 financial results and considered whether it contains any
apparent misstatements or material inconsistencies with the
information in the interim financial statements.
PricewaterhouseCoopers LLP
Chartered Accountants
Aberdeen
29 September 2017
a) The maintenance and integrity of the Motif Bio plc website is
the responsibility of the directors; the work carried out by the
auditors does not involve consideration of these matters and,
accordingly, the auditors accept no responsibility for any changes
that may have occurred to the interim financial statements since
they were initially presented on the website.
b) Legislation in the United Kingdom governing the preparation
and dissemination of financial statements may differ from
legislation in other jurisdictions.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR EAFNPASFXEAF
(END) Dow Jones Newswires
September 29, 2017 02:02 ET (06:02 GMT)
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