- Clinical program for the antibiotic candidate DNV3837
continues, with the support of investigators in the United
States
- AGIR program (Antibiotics against Resistant Infectious Germs):
reaching second key milestone generated the payment of €1.5M by
Bpifrance
- Launch of two novel next-generation active substances,
including the first extract developed with Hallstar and derived
from the fermentation of a Deinove microorganism
- Consolidated net income: -€4.6M compared to -€5.4M in H1
2019
- Group cash position:
- Balance of +€3.2M at June 30, 2020 compared to +€1.1M at
December 31, 2019
- €2M to be received in October: loans granted by Bpifrance
(R&D innovation loan) and Société Générale (State guaranteed
loan)
Regulatory News:
DEINOVE (Paris:ALDEI) (Euronext Growth Paris: ALDEI), a French
biotech company, pioneer in the exploration and exploitation of
bacterial biodiversity to address the urgent, global challenge of
antibiotic resistance and the need for next-generation active
ingredients serving Health, announces that its Board of
Directors has approved the financial statements for the first half
of 2020.
Charles Woler, Chairman and Chief Executive Officer of
DEINOVE, stated: "In the uncertain health and economic context
that characterizes 2020, DEINOVE was able to stay the course. Our
financial position has improved, and our operating loss has been
reduced.
At the same time, we continued our efforts to advance the
programs, including the DNV3837 clinical trial, which continued
recruiting patients with the support of the investigating
physicians, despite the health situation in the United States. Our
upstream research programs (AGIR) have also advanced, with
completion of the second key milestone, and we continue our efforts
to provide the industry with new active substances.
Now led by Alexis RIDEAU, our team is resolutely pursuing its
activities with three clear objectives: strengthen the company’s
presence in the pharmaceutical sector, generate revenues through
strategic partnerships in the biotechnology sector, excel in
project management in order to control all of our expenses and
maintain financial flexibility."
SYNTHETIC CONSOLIDATED FINANCIAL
DATA
The DEINOVE Group’s consolidated financial statements at June
30, 2020 were subject to a limited review by the Group’s statutory
auditors, the firm PwC (PricewaterhouseCoopers).
PROFIT AND LOSS ACCOUNT
(in thousands of euros)
30.06.2020
30.06.2019
Operating revenues
596
405
Of which operating grants
389
397
Operating costs
5 480
6 587
Of which Research & Development
costs
4 460
5 412
Of which Administrative and General
costs
1 020
1 175
OPERATING PROFIT / LOSS
- 4 884
- 6 181
PROFIT / LOSS
- 6
- 14
PROFIT / LOSS FROM NON-RECURRING
ACTIVITIES
- 34
- 49
Income tax and deferred taxes
- 544
- 1 140
Goodwill amortization
256
256
Results from equity affiliates (MEQ)
-
-
CONSOLIDATED GROUP PROFIT / LOSS
- 4 634
- 5 359
(in thousands of euros)
30.06.2020
31.12.2019
Term deposit
-
-
Provision for impairment of marketable
securities
-
-
Cash on hand
3 193
1 095
ICNE and bank overdrafts
-
-
CASH & CASH EQUIVALENTS
3 193
1 095
OPERATIONAL PROGRESS DURING THE
PERIOD AND POST-CLOSING
NEXT-GENERATION ANTIMICROBIALS
DNV3837: Initiation of Phase II
clinical trial in Clostridioides difficile infections
The Phase II trial testing the antibiotic candidate DNV3837 in
Clostridioides difficile1 gastrointestinal infections (CDIs),
enrolled its first patient in January2.
This trial aims to evaluate the efficacy of DNV3837 in a
pathological context, in patients with moderate to severe CDI, as
well as to consolidate safety and pharmacokinetic data. The trial
is multicentric and concentrated in the United States where
prevalence is higher and regulatory authorities are looking for new
therapeutic options.
Post-closing3, DEINOVE confirmed the continuation of this trial
despite the tense health context in the United States, related to
the Covid-19 pandemic. Several of the investigative centers have
maintained their clinical research activities and continue to
screen and include patients. The DEINOVE scientific team and the
CRO Medpace are following the situation closely.
AGIR program: DEINOVE validates the
second key milestone and receives €1.5M from Bpifrance 4
The challenge for AGIR is to accelerate exploration of the
antibiotic activities of multiple strains under various conditions
in order to rapidly detect new structures.
The first stage of the program had led to the setting up of a
robotic platform for extracting and screening strains. The second
stage allowed the screening of an increasing number of strains, the
validation of the automated tools developed by DEINOVE and the
detection of some thirty “hits”. The characterization of active
extracts makes it possible to identify potential new, previously
unknown, bioactive molecules.
According to the terms of the collaborative research program
selected in 2017 by the Investments for the Future program, the
results obtained enabled DEINOVE to validate the EC2 of the AGIR
program and to receive €1.5M.
NEXT-GENERATION ACTIVE INGREDIENTS
New industrial production of
Phytoene to supply the market5
In early 2020 DEINOVE launched the production of a new batch of
phytoene-based active ingredient to meet the needs of its
distributors. The product has been sampled by nearly 100 brands,
which are carrying out various projects for the development of
cosmetic products incorporating this active ingredient.
Launch of a new active ingredient
based on Neurosporene, an exclusive carotenoid6
Neurosporene is a novel carotenoid on the market with
exceptional antioxidant properties. It has the particularity of
absorbing blue light, responsible for early aging of the skin,
including the formation of brown spots. Efficacy studies,
particularly clinical studies, have demonstrated its beneficial
effect on the health and beauty of the skin.
The introduction of this active ingredient to the market was
initiated in April 2020.
Commercial launch of the new active
ingredient co-developed with Hallstar France7
BIOME Oléoactif® is an active ingredient produced from a rare
extremophilic bacterium that DEINOVE has managed to cultivate, and
whose potential is reinforced by the original oleo-eco-extraction
technique patented by Hallstar France (formerly Oléos). Thanks to
its unique composition of innovative active molecules, it helps
strengthen the skin’s barrier function.
The official launch of this active ingredient took place in
April 2020.
The planned partnership with Sharon
Laboratories is finally abandoned
In February 2020 DEINOVE announced the signing of a Memorandum
of Understanding (MoU) with the Israeli group Sharon Laboratories8
for the development and marketing of an innovative range of
bio-based cosmetic ingredients. This agreement was to be finalized
before the end of March 2020. The rapid development of the Covid-19
pandemic and the deterioration of economic conditions doomed this
project9, given the significant uncertainties in the short term.
DEINOVE retained the $200K collected on the signature of the
MoU.
FINANCIAL RESULTS FOR THE FIRST
HALF OF 2020
The consolidated financial
statements of the DEINOVE Group for the first half of 2020 include
the accounts of the Company, as well as the accounts of the
wholly-owned subsidiary MORPHOCHEM.
OPERATING REVENUE
The Group recorded €596K in operating revenue over H1, mainly
comprising the payment by Bpifrance of the grant corresponding to
the completion of the second key milestone of the AGIR program for
an amount of €381K, and the amount received from Sharon
Laboratories on the signature of the MoU (€181K), amount that was
retained despite the abandonment of the partnership caused by the
Covid-19 pandemic and the deterioration of economic conditions.
For the first half of 2019, operating income amounted to €405K,
mainly including the part of the grant corresponding to the first
milestone of the AGIR program (€397K).
During the first half of 2020, the Group’s operating expenses
reached €5.5M, of which 81% was spent on R&D activities.
When comparing H1 2019 and H1 2020, operating expenses are down
17% (-€1.1M). Subcontracting and external study expenses, which
mainly include CRO services related to the DNV3837 clinical study,
decreased by 28%, mainly due to the internalization of certain
operations. The Rents, Maintenance and Servicing costing item
decreased by 31%, as a result of the second quarter rent waiver as
part of the Covid-19 support measures. Miscellaneous Expenses (+38%
over the period), include €36K of OCA-related costs. Fees increased
by +10% due to costs incurred with Sharon Laboratories (€76K) and
pre-financing costs of the R&D Tax Credit (€23K). The Missions
and Travel item is down -66%.
Staff expenses decreased by -16%, with 2 FTE less and use of
partial activity for the teams based in Lille. Depreciation,
Amortization and Provisions (-7%), include a provision for risk on
the amount of the R&D Tax Credit 2019 (€28K) and 2020 (€9K).
The 2019 R&D Tax Credit has since been formally validated for
its full amount by the tax authorities.
NET INCOME
The consolidated net loss for the period amounts to €4.6M. It
includes a negative financial result of -€6K mainly comprising a
gain on securities transactions related to the liquidity contract
(+€5K) and financial expenses related to leasing, pre-financing of
the R&D Tax Credit and foreign exchange losses (-€ 11K in
total).
Income tax includes almost exclusively the R&D Tax Credit.
The Group’s receivable for the first half year was estimated at
€544K (compared to €1.140K in H1 2019).
The Exceptional Result at June
30, 2020 is mainly composed of a provision of €38K related to
certain expenses charged to the 2019 and 2020 R&D Tax Credit
(including €28K for 2019). The eligibility of these expenses on the
2019 R&D Tax Credit has since been validated by the Direction
Départementale des Finances Publiques (Public Finance Departmental
Director) by a letter dated 04/09/2020.
FINANCIAL SITUATION
Financial requirements for the first half of the year mainly
concerned operating expenses, for €4.9M (excluding depreciation and
amortization), to which were added investments in laboratory
equipment (including lease payments) for €0.1M.
Over the same period, the Group received €1.5M in public aid
under the AGIR program and €2.1M under the 2019 R&D Tax Credit
(via pre-financing by Société Générale Factoring). DEINOVE received
the sum of €2.5M (net) under the second and third tranches of the
OCA subscribed by the ESGO Fund (L1 Capital). At June 30, 2010, the
Group’s net financial position amounted to +€3.2M.
Subsequent to closing, the Group was notified of the obtention
of €1.0M of R&D Innovation Loan from Bpifrance and €1.0M of
State Guaranteed Loan granted by Société Générale, as part of the
support measures related to the Covid-19 pandemic. This amount will
reinforce the cash position in October.
IMPACTS OF THE COVID-19
PANDEMIC
The global pandemic of Covid-19 which has developed since the
beginning of the year has had the following impacts for
DEINOVE:
⁃ R&D operations continued during and after the period of
containment, thanks to the commitment of the teams, working from
home and in the Company’s laboratories, while complying with health
constraints.
⁃ Logistical difficulties induced by the period of containment
may have caused a slight delay in some programs. However,
operations have gradually resumed since then, and no program has
been called into question.
⁃ The planned partnership project with Sharon Laboratories was
abandoned in view of the many operational and economic
uncertainties weighing on the entire industrial sector at the time
the final contract could have been signed (March 2020).
⁃ The Phase II clinical trial testing DNV3837 in C. difficile
infections (CDI) has been impacted by the extent of the pandemic in
the United States and the strong pressure on hospital services.
However, several of the investigative centers have kept recruitment
open in light of the high medical need in patients with severe CDI
and continue to screen and include patients.
⁃ Post-closing, DEINOVE has secured the approval for benefiting
from the financial mechanisms put in place by the French government
to support companies. The Company will receive shortly €2M,
including €1M of State guaranteed loan and €1M of R&D
Innovation Loan.
CORPORATE INFORMATION
BOARD OF DIRECTORS
The Ordinary and Extraordinary Shareholders’ Meeting of June 16,
2020 renewed, for a period of three years, the mandate of Anne
ABRIAT, Charles WOLER and Hervé BRAILLY, which had expired. It also
ratified the appointment of Emmanuel PETIOT as Administrator, made
on a provisional basis by the Board of Directors at its meeting of
December 3, 2019.
EXECUTIVE COMMITTEE
Dr Charles Woler, Chairman of the Board of Directors of DEINOVE,
was appointed interim Chief Executive Officer, as of January 1,
2020, following the resignation of Emmanuel PETIOT in December
2019. The Board of Directors began the process of recruiting a new
Chief Executive Officer.
With effect from May 1, the Board of Directors appointed Alexis
RIDEAU as Deputy Chief Executive Officer10. Prior to joining
DEINOVE, Alexis RIDEAU was in charge of developing industrial
relations and coordinating the strategic partnership team at
BIOASTER (Lyon/Paris), a Technology Research Institute in applied
microbiology, which specializes in the design and use of technology
innovations in the field of microbiology to accelerate the
development of medical and nutritional industrial solutions for
animal and human health.
Mario ALCARAZ joined DEINOVE in July 2020 as Chief Financial and
Administrative Officer, also in charge of investor relations and
financial communication, replacing Julien COSTE. An experienced
financial director, mastering at the same time the financial,
legal, accounting and strategic aspects of the function, he has
worked in the sectors of mass distribution (Auchan), energy
transition (ENGIE Cofely), industry (Coldway Technologies) and
aeronautics (Toulouse-Blagnac Airport). This last experience as
Head of Management Control will be a key asset in ensuring
DEINOVE’s economic performance.
SHARE CAPITAL BREAKDOWN
As at June 30, 2020, the Company’s share capital consisted of
21,644,898 ordinary shares with a nominal value of €0.40 of which
26,078 shares (that is approximately 0.12% of the share capital)
were held by the Company within the framework of the liquidity
contract entrusted to Kepler Cheuvreux.
Ownership structure as at June 30,
2020 – non-diluted basis
Shareholders
Number of shares
% of holding
Voting rights
%
Funds managed by Truffle Capital
1 385 637
6,40%
2 549 592
10,96%
Funds managed by TVM Capital
1 557 414
7,20%
1 557 414
6,70%
Scientific founders
20 000
0,09%
40 000
0,17%
Management and Administrators
73 140
0,34%
107 251
0,46%
Free float
18 606 707
85,07%
19 005 589
81,71%
TOTAL
21 644 898
100,00%
23 259 846
100,00%
CHANGES IN SHARE CAPITAL
During the first half of 2020, the Board of Directors
acknowledged the issue of 500,001 new shares following the exercise
of BAA-BIOVERTIS and the issue of 3,114,939 new shares following
the conversion of OCAs pursuant to the agreement between the
Company and the European Select Growth Opportunities Fund.
A total of 3,614,940 new shares were issued during the first
half of 2020, representing a capital increase of €1,445,976. As of
June 30, 2020, the Company’s share capital consisted of 21,644,898
shares with a par value of €0.40 each.
The 2020 half-year financial report will be
available at: http://www.deinove.com/fr/espace-investisseurs/centre-documentation/rapports-financiers
ABOUT DEINOVE
DEINOVE is a French biotech company, a pioneer in the
exploitation of the unknown or little-known part of biodiversity.
By using rare or “non-cultivable” bacteria and by working on
unexplored molecular pathways, the Company discovers, develops and
produces antimicrobials to meet the urgent, global challenge of
antibiotic resistance, and the need for next-generation active
ingredients to serve Health.
In nearly 15 years, the Company has built a unique collection of
over 10,000 bacterial strains and has developed a fully integrated
technological platform that brings together the best of biological
culture, synthetic biology and micro-biotechnology.
Today, DEINOVE has several development programs underway,
including the antibiotic candidate DNV3837, in a Phase II clinical
trial in severe gastrointestinal infections with Clostridioides
difficile, a real therapeutic challenge. Through its other program
AGIR (Antibiotics against Resistant Infectious Germs), supported by
Bpifrance, it is also continuing its exploration of biodiversity to
supply its portfolio with new molecules. It relies on its own
biodiversity and on the one entrusted to it by other specialists in
the field.
DEINOVE has also developed and brought to market four
particularly innovative active ingredients: a first which is
phytoene-based and a neurosporene concentrate produced by
Deinococcus geothermalis, as well as two cell extracts developed in
collaboration.
DEINOVE, located in the Euromédecine science park in
Montpellier, employs 56 people, mainly researchers, engineers and
technicians, and has filed over 350 patent applications
internationally. It is listed on EURONEXT GROWTH® (ALDEI – code
ISIN FR0010879056).
Visit www.deinove.com
1 Clostridioides difficile is a WHO priority pathogen and one of
the first causes of hospital-acquired infections worldwide,
according to the US Center for Disease Control and Prevention (CDC)
2 Press release issued January 27, 2020 3 Press release issued July
15, 2020 4 Press release issued March 11, 2020 5 Press release
issued January 22, 2020 6 Press release issued April 23, 2020 7
Press release issued March 18, 2020 8 Press release issued February
6, 2020 9 Press release issued March 30, 2020 10 Press release
issued May 4, 2020
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201001005610/en/
Investors Mario Alcaraz Chief Financial and Administrative
Officer Phone: +33 (0)4 48 19 01 00 mario.alcaraz@deinove.com
Media ALIZE RP - Caroline Carmagnol Phone: +33 (0)6 64 18 99 59
deinove@alizerp.com