Incanthera PLC - Half-year Report
RNS Number : 8333H
Incanthera PLC
08 December 2020
 

 

 Incanthera plc

("Incanthera" the "Company")

Interim results for the six months ended 30 September 2020

 

Solid Progression in year of Successful Admission to AQSE Growth Market

 

Incanthera plc (AQSE:INC), the specialist oncology company focused on transforming cancer treatment, is pleased to present its interim results following the successful flotation of the Company to the Aquis Stock Exchange Growth Market (AQSE Growth Market) in February this year.

 

Incanthera is focused on transforming cancer treatment by creating environments in which cancer cannot survive. It seeks to identify and develop innovative solutions to current clinical, commercially relevant unmet needs, utilising new technology from leading academic institutions.

 

Highlights:

·    Successful Sol study results exceeded management's expectations

 

·    Permeation study of Sol demonstrates:

statistically significant greater dermal delivery compared with four known comparator products.

confirmation of exceeding bioequivalence compared with oral delivery.

 

·    Sensitisation study of Sol demonstrates:

formulation found to be "non-irritant" using ex-vivo human skin.

level of irritancy found to be comparable to baby sun protection products.

 

Financial Highlights:

·    Strong financial control through period, ensuring financial position on budget.

·    Completion of the IPO subscription agreements realising £350k investment from an existing shareholder, the Board of directors and the management team.

·    Cash balance at 30 September 2020 of £433k (2019: £51k).

·    Operating losses for the period reduced to £471k (2019: £485k).

 

Tim McCarthy, Chairman, commented:

 

"I am delighted to present Incanthera's interim results.

 

We have seen significant value addition during these six months, with the solid progression of our lead asset Sol, together with strong financial control, and investment from subscription agreements entered into at the time of  the Company's IPO.

 

As we look to the opportunities ahead of us, I would like to thank our existing shareholders for their support and our team for these successes, against a difficult backdrop.  We look forward to sharing further progress in the near future."

 

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

 

The Directors of Incanthera accept responsibility for this announcement.

 

For further information, please contact:

 

Tim McCarthy, Chairman

tim.mccarthy@incanthera.com

 

Simon Ward, Chief Executive Officer

simon.ward@incanthera.com

 

Suzanne Brocks, Head of Communications

suzanne.brocks@incanthera.com

 

+44 (0) 7831 675747

 

 

+44 (0) 7747 625506

 

 

+44 (0) 7776 234600

 

Aquis Exchange Corporate Adviser:

Cairn Financial Advisers LLP

Jo Turner/James Lewis

 

+44 (0)20 7213 0880

Broker:

Stanford Capital Partners Ltd

Patrick Claridge/John Howes/Bob Pountney

+44 (0)20 3815 8880

 

Notes to Editors

 

Incanthera is a specialist oncology company focused on transforming cancer treatment by creating environments in which cancer cannot survive. It seeks to identify and develop innovative solutions to current clinical, commercially relevant unmet needs, utilising new technology from leading academic institutions.

 

The Company's current lead product and focus is Sol, a potentially innovative topical product for the treatment of solar keratosis and the prevention of skin cancers. This has achieved proof of concept and the Company is now focussed upon delivering Sol to a commercial partner.

 

The Company originated from the Institute of Cancer Therapeutics (ICT) at the University of Bradford and has acquired and developed a portfolio of specific cancer-targeting therapeutics through a Pipeline Agreement with the ICT and other corporate acquisitions. Incanthera's strategy is to develop each candidate in the portfolio from initial acquisition or discovery to securing its future through commercially valuable partnerships at the earliest opportunity in its development pathway.

 

The majority of conventional cancer treatments (other than surgery) on the market are chemotherapy or radiotherapy based. These are non-selective by nature and highly toxic to healthy tissue as well as tumours. Accordingly, treatment can only be delivered in carefully controlled doses over a limited period of time. To address this problem directly, the Company has developed sophisticated formulation and prodrug targeting technologies to deliver treatment specifically to the tumour. Prodrugs are chemically modified versions of pharmacologically active agents which only become active when they reach a target, thus reducing generalised toxicity in normal tissues, whilst enabling higher doses to reach a target and therefore increase efficacy.

 

Incanthera's Board and management possess a broad range of commercial, scientific and public company experience. In addition, Incanthera benefits from a diverse, experienced team of advisers who cover the necessary range of specialities required for all aspects of the Company's business, and also has a number of beneficial collaborative relationships with both clinicians and clinical centres. In particular, the Pipeline Agreement with the ICT, provides a strong working relationship with a world-recognised oncology research institute and access to future pipeline opportunities.

 

For more information on the Company please visit: www.incanthera.com

 

 

 

 Incanthera plc

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2020

Chairman's Statement

 

I am delighted to present our first set of interim results, following the successful admission of our Company onto the AQSE Growth Market (formerly NEX Exchange Growth Market) in February this year.

 

It has certainly been an interesting six months. With the world going into lockdown in March, due to COVID-19, global attention turned to healthcare for personal protection, finding a solution to the pandemic and more broadly to highlighting the importance of continued medical research. 

 

We are proud to be in the business of improving health outcomes through innovative solutions, development of technologies and delivery systems and to enhance patients' treatment options and lives. Incanthera has a pipeline of products aimed at targeted delivery of therapeutic actives.

 

When we came to market in February this year, we raised funds specifically to focus on our skin cancer asset, Sol.  We are pleased that, despite the challenging backdrop, we have progressed well in developing Sol, on the path towards our commercialisation goal.

 

The results achieved within the two Sol studies undertaken over the six-month period surpassed our expectations and proved the permeation capabilities and safety of our formulation. This means that not only do we know that Sol works to achieve something nothing else currently available can, but also that it is as safe as a baby sun protection cream in terms of 'non-irritancy'. 

 

These announcements have been well received by investors and the market, and we have seen a positive share price performance as a result.

 

Our financial position is precisely on budget due to strong financial control and management, with reduced operating losses for the period of £471k, down from £485k in 2019. Our cash balance at 30 September was significantly strengthened at £433k, up from £51k in 2019.

 

In September, we announced the completion of the IPO subscription agreements, participated in by ImmuPharma plc and our Board and management team, realising a £350k of investment. I would like to thank the board of ImmuPharma for their ongoing involvement and support of Incanthera and I would like to applaud the team for their further investment, a public endorsement of all of our belief in the future of our Company.

 

We are confident of delivering further positive milestones in the near future and are consistently reviewing new opportunities and the evolution of our technologies to address the concern and demands across healthcare. Significantly, we continue to work closely with the Institute of Cancer Therapeutics ("ICT") at the University of Bradford.

 

I wish all my colleagues, fellow shareholders and collaborators a safe and healthy end to the year.

 

Tim McCarthy

Chairman

 

08  December 2020
 

 

Chief Executive's Review

I am very pleased to present Incanthera's first interim results since becoming a public listed company on the AQSE Growth Market.

From the backdrop of the IPO in February this year, the past six months have marked an extraordinary period in many ways. The spotlight on healthcare has never been more prominent and to work at the forefront of innovation is exhilarating.

Strategic Progress

We have marked several milestones in our progression since the IPO this year and we are grateful for the support and interest in our Company, from our shareholder base, advisers and team.

Most notably in the period under review, we have delivered successful data on the formulation work undertaken on Sol, via studies conducted on our skin cancer asset.

Sol is our proprietary topical formulation designed to deliver into the skin an active known to treat solar (actinic) keratoses and prevent the formation of related skin cancers.

Since IPO, our formulators have worked to refine and deliver a concentration of Sol that now demonstrates statistically significant greater dermal delivery compared with four known comparator products.

In September, we published results of a study, run by the University College of London, School of Pharmacy, which demonstrated that Sol affords greater permeation (delivery of the active into the skin) than four known comparator products. The data confirms that this new refined formulation of Sol also exceeds bioequivalence when compared with oral dosing of the same active.

These results have exceeded the Company's expectations, demonstrating the efficacy of Sol's formulation in penetrating the skin barrier and reaching the deeper layers where an effective prevention of skin cancer could be achieved.

The Company is delighted with not only the confirmation of Sol's superior formulation technology capabilities against non-proprietary creams, but also the strength of the data received, which further enhances our data package to potential commercial partners.

This study closely followed the announcement of positive sensitisation study results.

The sensitisation study, conducted by XCellR8 Ltd, demonstrated that our Sol formulation was found to be "non-irritant" using ex-vivo human skin.

Formerly, studies carried out in collaboration between XCellR8 Ltd and Cutest Ltd (a clinical research organisation with particular expertise in clinical trials using topical applications) have demonstrated very good correlation between results using the methodology of this study and those obtained in clinical mildness studies.

Sol's "non-irritancy" was found to be comparable to baby sun protection products tested previously, with Sol scoring better than those products which they would define as "very mild".

The comfort and safety of human skin's reaction to the topical application of Sol is a further valuable marker of the asset and this technology, greatly enhancing the product's overall profile.

These results followed the filing in July 2020 of a new patent, protecting Sol for the prevention and treatment of solar keratoses and related cancers of the skin, which if granted, will further extend the life of the patent family protecting Sol to 2041. This new patent filing demonstrates the robust foundations of our Sol programme and strengthens the commercial protection for the product.

We are delighted with the results of the studies, which provide great evidence, equating to great commercial potential as we look to the next steps of bringing Sol forward to market-facing partners.

Publicity and awareness surrounding the increasing rates of skin cancer continue and the demographics of the rising trend, specifically amongst the younger population, is a huge oncology focus and an enormous commercial market, where currently no active topical solution exists.  We are very excited to have strengthened our position with these results and patent protection and we look forward to providing further updates as we progress.

Investment

We are pleased that the positive news flow we have been able to deliver has raised public awareness of the Company. We have also seen a positive uplift in our share price since the IPO.

We acknowledge the support of our investors, which has been invaluable to us in the nine months so far since listing. We aim to deliver much more as we progress.

Further investment, in September, through subscriptions entered into at the time of the IPO have further strengthened our financial position.

We have seen fantastic support from our advisers and the Aquis Stock Exchange, who have highlighted us a success story on their website.

Pipeline

Incanthera has evolved to be a vibrant public company, intent on accelerating the provision of innovative new medicines through commercial partnerships.

Our existing pipeline consists of assets obtained through our heritage with the ICT at the University of Bradford and from our commercialisation history of acquisition and licensing.

Our Company mantra of 'Acquire, Prepare, Commercialise' aims to seek out innovative and differentiating targeted therapeutics, utilising the expertise and experience of the Incanthera team, strategically prepare these and secure the earliest tangible value and their commercialisation.

Our first commercial deal was for the vascular disrupting technology known as EP0015, licensed to Ellipses Pharma in 2017.

Our oncology programmes of Equin and Duo-C remain protected by our patent filings and, whilst our concentration has been on Sol for this period, our existing portfolio is consistently assessed and reviewed for opportunities.

Incanthera's establishment as a spin out from ICT at the University of Bradford ten years ago began our commercialisation journey, and the working relationship has remained strong in the decade since. Incanthera sponsors a Doctorate Programme for PhD students at the ICT, and through a unique Pipeline agreement, receives first right to access of all future intellectual property from the ICT.

Future Opportunities

Of the many benefits being a public company can offer our Company and shareholders, the greater profile and awareness it brings for our portfolio of existing assets, combined with the opportunities for discussion towards new potential technologies is something we are thrilled to be experiencing and evaluating.

The evolution of our Company from the established heritage of a vehicle formed from the ICT to develop and commercialise oncology assets then adding our near-term asset Sol, all of which has led to our public listing, has been a journey of enormous pride and achievement.

We have the platform from which to deliver on our promise to shareholders; to evaluate and introduce future technologies and to progress this Company through the hard efforts of our dedicated team.

I would like to thank the team, our advisers and our shareholders for providing the opportunity to progress and deliver enhanced technologies and outcomes to patients, and to wish everyone well through the remainder of 2020 and beyond.

 

Simon Ward

Chief Executive Officer

 

8 December 2020

 

 

 

Consolidated Statement of Comprehensive Income

for the six months ended 30 September 2020 - unaudited

 

 

 

Six months ended

30 September 2020

Six months ended

30 September 2019

Year ended

31 March

 2020

 

 

£'000

£'000

£'000

 

Notes

unaudited

unaudited

audited

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

(452)

(338)

(933)

Share-based compensation

4

(19)

(147)

(293)

Total operating expenses

 

(471)

(485)

(1,226)

 

 

 

 

 

Operating loss

 

(471)

(485)

(1,226)

 

 

 

 

 

Loss on ordinary activities before taxation

 

(471)

(485)

(1,226)

 

 

 

 

 

Taxation

 

-

-

98

Loss and total comprehensive expense attributable to equity holders for the period

 

(471)

(485)

(1,128)

 

 

 

 

 

 

Loss earnings per share (pence)

 

 

 

 

Basic loss per share

3

(0.77)

(1.00)

(2.27)

Diluted loss per share

3

(0.77)

(1.00)

(2.27)

 

                                                                                                                                                                                                                  

                                                                                                                                                                                                                  

Consolidated Statement of Financial Position

as at 30 September 2020 - unaudited

 

 

 

 

As at

30 September 2020

As at

30 September 2019

As at 31 March

 2020

 

 

 

£'000

£'000

£'000

 

 

Notes

unaudited

unaudited

audited

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

Property, plant and equipment

 

 

2

4

3

Intangible assets

 

 

685

856

787

Total non-current assets

 

 

687

860

790

 

 

 

 

 

 

Current assets

 

 

 

 

 

Trade and other receivables

 

 

248

18

114

Current tax receivable

 

 

95

(3)

95

Cash and cash equivalents

 

 

433

51

392

Total current assets

 

 

776

66

601

 

 

 

 

 

 

Total assets

 

 

1,463

926

1,391

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

Trade and other payables

 

 

351

260

177

Total current liabilities

 

 

351

260

177

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

Ordinary shares

 

5

1,291

25

1,217

Share premium

 

 

4,719

7,305

4,443

Reorganisation reserve

 

 

2,715

-

2,715

Share based compensation

 

 

605

548

586

Retained deficit

 

 

(8,218)

(7,212)

(7,747)

Total equity

 

 

1,112

666

1,214

 

 

 

 

 

 

Total liabilities and equity

 

 

1,463

926

1,391

 

 

Consolidated Statement of Changes in Equity

for the six months ended 30 September 2020 - unaudited

 

 

Share capital

Share premium

Merger reserve

Share based compensation

Accumulated losses

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

Balance at 1 April 2020

1,217

4,443

2,715

586

(7,747)

1,214

Total comprehensive expense for the period

-

-

-

-

(471)

(471)

Transactions with owners

 

 

 

 

 

 

Share issue

74

276

-

-

-

350

Share-based compensation - share options

-

-

-

19

-

19

Total transactions with owners

74

276

-

19

-

369

Balance at 30 September 2020

1,291

4,719

2,715

605

(8,218)

1,112

 

 

 

Share capital

Share premium

Merger reserve

Share based compensation

Accumulated losses

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

Balance at 1 April 2019

25

7,305

-

401

(6,727)

1,004

Total comprehensive expense for the period

-

-

-

-

(485)

(485)

Transactions with owners

 

 

 

 

 

 

Share-based compensation - share options

-

-

-

147

-

147

Total transactions with owners

-

-

-

147

-

147

Balance at 30 September 2019

25

7,305

-

548

(7,212)

666

 

 

 

Share Capital

Share premium

Merger reserve

Share based compensation

Accumulated losses

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

Balance at 1 April 2019

25

7,305

-

401

(6,727)

1,004

Total comprehensive expense for the period

-

-

-

-

(1,128)

(1,128)

Transactions with owners

 

 

 

 

 

 

Share issue - acquisition of Incanthera R&D Limited

946

(3,663)

2,715

-

-

(2)

Share issue - cash

180

554

-

-

-

734

Share issue - creditor swap

66

247

-

-

-

313

Share-based compensation - share options

-

-

-

293

-

293

Share-based compensation - lapsed options

-

-

-

(108)

108

-

Total transactions with owners

1,192

(2,862)

2,715

185

108

1,338

Balance at 31 March 2020

1,217

4,443

2,715

586

(7,747)

1,214

The registered number of Incanthera plc is 11026926.

 

 

Consolidated Statement of Cash Flows

for the six months ended 30 September 2020 - unaudited

 

 

 

Six months ended

30 September 2020

Six months ended

30 September 2019

Year ended

31 March

2020

 

 

£'000

£'000

£'000

 

 

unaudited

unaudited

audited

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

Loss before taxation for the period

 

(471)

(485)

(1,226)

Depreciation and amortisation

 

103

65

135

Share-based compensation

 

19

147

293

 

 

(349)

(273)

(798)

Changes in working capital

 

 

 

 

(Increase)/decrease in trade and other receivables

 

(134)

82

(14)

Increase/decrease in trade and other payables

 

174

38

(46)

Creditor swap

 

 

 

313

Cash used in operations

 

40

120

253

Taxation received

 

-

28

27

Net cash used in operating activities

 

(309)

(126)

(518)

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Purchase of property, plant and equipment

 

-

-

-

Net cash used in investing activities

 

-

-

-

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Proceeds from issue of shares

 

350

-

855

Issue costs

 

-

-

(121)

Net cash generated from financing activities

 

350

-

734

 

 

 

 

 

Movements in cash and cash equivalents in the period

 

41

(126)

216

Cash and cash equivalents at start of period

 

392

176

176

Cash and cash equivalents at end of period

 

433

51

392

 

 

 

1. GENERAL INFORMATION

 

Incanthera plc ('the Company') is a public limited company incorporated in England and Wales and was admitted to trading on the AQSE Growth Market (formerly NEX Exchange), under the symbol INC on 28 February 2020.

 

The address of its registered office is 76 King Street, Manchester, England, M2 4NH and the registered company number is 11026926. The principal activity of the Company is clinical stage drug development.

 

 

2. BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES

 

Basis of preparation

Basis of consolidation

Going concern

 

 

Significant management judgement in applying accounting policies and estimation uncertainty

When preparing the condensed consolidated interim financial information, the Directors make a number of judgements, estimates and assumptions about the recognition and measurement of assets, liabilities, income and expenses.

 

The following are significant management judgements and estimates in applying the accounting policies of the Group that have the most significant effect on the condensed consolidated interim financial information.  Actual results may be substantially different.

 

Share-based payments

The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value of the options granted is determined using the Black-Scholes model, taking into consideration the best estimate of the expected life of the option and the estimated number of shares that will eventually vest.

 

Research and development expenditure

Careful judgement by the Directors is applied when deciding whether the recognition requirements for development costs have been met. This is necessary as the economic success of any product development is uncertain until such time as technical viability has been proven and commercial supply agreements are likely to be achieved. Judgements are based on the information available at each reporting date which includes the progress with testing and certification and progress on, for example, establishment of commercial arrangements with third parties. In addition, all internal activities related to research and development of new products are continuously monitored by the Directors.

 

 

3. LOSS PER SHARE

 

Basic loss per share is calculated by dividing the loss for the period attributable to equity holders by the weighted average number of ordinary shares outstanding during the period. 

 

For diluted loss per share, the loss for the period attributable to equity holders and the weighted average number of ordinary shares outstanding during the period is adjusted to assume conversion of all dilutive potential ordinary shares. As the effect of the share options would be to reduce the loss per share, the diluted loss per share is the same as the basic loss per share.

 

The calculation of the Group's basic and diluted loss per share is based on the following data:

 

 

Six months ended

30 September 2020

Six months ended

30 September 2019

Year ended

31 March

 2020

 

£'000

£'000

£'000

 

unaudited

unaudited

audited

Loss for the period attributable to equity holders

(471)

(485)

(1,128)

 

 

 

 

 

 

As at

30 September 2020

 

As at

30 September 2019

 

As at

31 March

 2020

 

Number

Number

Number

 

unaudited

unaudited

audited

Weighted average number of ordinary shares

60,859,910

48,564,380

49,642,344

Weighted average number of ordinary shares adjusted for the effects of dilution

60,859,910

48,564,380

49,642,344

 

 

 

 

 

 

 

 

 

Pence

Pence

Pence

Loss per share - basic and diluted

(0.77)

(1.00)

(2.27)

 

 

 

 

 

 

 

 

4. SHARE-BASED PAYMENTS

 

As at the end of the current period, the reconciliation of share option scheme movements is as follows:

 

 

 As at 30 September 2020

 

Number

WAEP

pence

Outstanding at 1 April 2020

7,272,740

9.50

Granted during the period

8,086,677

9.50

Exercised during the period

 

-

Lapsed/cancelled during the period

-

-

Outstanding at 30 September 2020

15,359,417

9.50

 

During the six month period ended 30 September 2020, a share-based payment charge of £19,096 (£147,000) was expensed to the consolidated Statement of Comprehensive Income.

 

The fair values of the options granted have been calculated using a Black-Scholes model.

 

 

 

 

 

 

 

 

 

5. ISSUED CAPITAL AND RESERVES

 

Ordinary shares

 

 

              Company

 

Number of Shares

Share Capital (£'000)

At 31 March 2020

60,859,910

1,217

Issued under IPO subscription agreements*

3,684,211

74

At 30 September 2020

64,544,121

1,291

 

*On 30 September 2020, 3,684,211 ordinary shares were issued under subscription agreements entered into at the time of the Company's IPO.

 

 

                                                                                                                                                                                                                  

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