Interim Results
Oxford Biomedica PLC
01 September 2004
Running simultaneously to the analyst briefing at 10.00 am there will be a live
audio web cast of the results presentation. To connect to the web cast facility
please go to the Company's website: www.oxfordbiomedica.co.uk approximately 10
minutes (09:50am) before the start of the briefing. This will also be available
for replay shortly after the presentation.
FOR IMMEDIATE RELEASE 1 SEPTEMBER 2004
OXFORD BIOMEDICA PLC INTERIM RESULTS
FOR THE SIX MONTHS ENDED 30 JUNE 2004
Oxford, UK - 1 September 2004: Oxford BioMedica (LSE: OXB) announced today its
interim financial results for the six months ended 30 June 2004. Year to date
highlights:
Oncology
• TroVax: interim results from two Phase II trials in colorectal cancer in
combination with standard of care chemotherapy indicate that the primary
endpoints have been achieved (see separate announcement).
• TroVax: statistical analysis of the completed Phase I/II trials in colorectal
cancer confirms the correlation between improved patient survival and immune
responses to TroVax.
• TroVax: Cancer Research UK commenced recruitment in a Phase II trial
investigating TroVax as an adjuvant to surgery in colorectal cancer.
• TroVax: the first US Phase II trial in renal cell cancer started under an IND.
• MetXia: recruitment is underway in a Phase I - Phase II trial in pancreatic
cancer.
• TroVax-Vet: Intervet has completed preclinical efficacy studies with the
animal cancer vaccine and is planning clinical trials.
Neurotherapy
• ProSavin: preclinical efficacy data in Parkinson's disease presented at the
American Society for Gene Therapy.
• ProSavin: discussions initiated with UK regulatory authorities prior to a
formal submission for the start of clinical trials.
• MoNuDin: preclinical efficacy data in ALS published in Nature.
• Innurex: preclinical data showing restoration of limb function in avulsion
(stretch) injury presented at the American Society of Gene Therapy.
LentiVector Technology
• Two license agreements signed with Merck & Co and Viragen respectively.
• Grant from the UK Department of Health to develop novel treatments for single
gene disorders.
Financial
• Cash and short-term investments at 30 June 2004 of £26.2 million (2003: £17.2
million).
• R&D costs and administration expenses for the period unchanged from last year
at £6.9 million.
• Cash burn for the half year of £5.7 million (H1 2003: £3.8 million). The
difference is due mainly to the timing of the receipt of R&D tax credit.
Commenting on the interim results, Prof. Alan Kingsman, Chief Executive of
Oxford BioMedica, said, 'Oxford BioMedica has had another successful period. The
clinical results with TroVax add further value to our lead oncology product,
while the neurotherapy pipeline continues to generate exciting preclinical proof
of concept data. We are very pleased to have secured two new partnerships on our
LentiVector technology and we expect further licensing deals for both our
technologies and our lead products.'
-Ends-
For further information, please contact:
Oxford BioMedica plc:
------------------------
Professor Alan Kingsman, Chief Executive Tel: +44 (0)1865 783 000
Nick Woolf, SVP Corporate Strategy
City/Financial Enquiries:
---------------------------
Lisa Baderoon/ Mark Court: Buchanan Communications Tel: +44 (0)20 7466 5000
Scientific/Trade Press Enquiries:
-----------------------------------
Sue Charles, Katja Stout: Northbank Communications Tel: +44 (0)20 7886 8150
An analyst briefing will be held at 10:00am today followed by a press briefing
which will commence at 11:30am. The venue for both meetings is Buchanan
Communications, 107 Cheapside, London EC2V 6DN. The analyst presentation will be
accessible live via a web cast and a recording will be available after the
meeting on the Company's website at www.oxfordbiomedica.co.uk.
Notes to editors
Oxford BioMedica (LSE: OXB) is a biopharmaceutical company specialising in the
development of novel gene-based therapeutics with a focus on the areas of
oncology and neurotherapy. The Company was established in 1995 as a spin out
from Oxford University, and is listed on the London Stock Exchange.
In addition to its technical expertise in gene delivery, Oxford BioMedica has
in-house clinical, regulatory and manufacturing know-how. The development
pipeline includes two novel anti-cancer products in clinical trials; and two
neurotherapy products in advanced preclinical development for Parkinson's
disease and retinopathy. The Company is underpinned by an extensive preclinical
and research portfolio and about 70 patent families, which represents one of the
broadest patent estates in the field.
The Company has a staff of approx. 65 split between its main facilities in
Oxford and its wholly owned subsidiary, BioMedica Inc, in San Diego, California.
Oxford BioMedica has corporate collaborations with Wyeth, Intervet, Merck & Co,
Amersham, Viragen and Kiadis.
Further information is available at www.oxfordbiomedica.co.uk.
Chairman's and Chief Executive's Report
The first half of 2004 has been another period of solid progress for Oxford
BioMedica. The Company has achieved key objectives in the development of both
its oncology and neurotherapy product portfolios.
In oncology, two further Phase II trials were started with TroVax(R), taking the
total number of Phase II trials underway to four, and the first trial with
MetXia(R) in pancreatic cancer commenced enrolment. The Company has also reported
interim data from two Phase II trials with TroVax in patients with colorectal
cancer, alongside chemotherapy. The interim results are encouraging and indicate
that the primary endpoints have been met. The Company is in discussion with
potential development partners, and is putting in place plans for Phase III
trials with TroVax in colorectal cancer.
The neurotherapy pipeline based on the Company's LentiVector(R) technology has
also progressed over the period. The lead product, ProSavin(R) for Parkinson's
disease, is on-track to enter clinical trials in 2005. Earlier this year the
Company reported preclinical proof of principle data for its Parkinson's
disease, motor neuron disease and spinal cord injury products. The LentiVector
technology was the subject of two license agreements in the first half of 2004
with Merck & Co and Viragen respectively.
Oncology
Oxford BioMedica continues to add value to its two lead oncology products,
TroVax and MetXia. Both products are addressing common cancer types that are
inadequately treated with current therapies, and both offer novel approaches
that are designed to be safer than conventional therapies. The first half of
2004 has seen a substantial drive to initiate additional Phase II trials and
accelerate recruitment. Five of six planned Phase II trials are underway with
TroVax and MetXia, including the first US trial for TroVax under an IND for
renal cell cancer. Also, the interim safety and immunological data from the
first Phase II trials with TroVax suggest that the primary endpoints have been
achieved. These results support moving towards Phase III trials in colorectal
cancer. The targeted antibody therapy collaboration with Wyeth is moving closer
to clinical development following Wyeth's decision to exercise its option on a
full product license at the end of 2003. Also in 2004, Oxford BioMedica's animal
cancer vaccine, TroVax-Vet(R), has completed relevant proof of concept studies and
clinical trials in dogs with pre-existing tumours are planned by the Company's
partner Intervet.
TroVax(R)
TroVax is Oxford BioMedica's lead cancer immunotherapy product based on the
proprietary tumour associated antigen 5T4. Given the wide distribution of 5T4 on
tumours, the product could be used in the treatment of most solid cancers and is
in Phase II trials for colorectal and renal cell cancer with a trial in breast
cancer expected to start before the end of the year.
In the first half of the year, the ongoing monitoring of patient survival in the
completed Phase I/II trials in patients with Stage IV colorectal cancer
generated further promising data. These initial trials investigated treatment
with TroVax as a single agent in patients who had completed chemotherapy. The
Company has previously reported that the Phase I/II trials have met all the
pre-designed endpoints of safety, observable tumour responses and specific
immune responses to 5T4. The updated survival assessment of patients has been
subjected to independent statistical analysis, which showed that the anti-5T4
responses correlated with improved survival of patients. The statistical
confidence of this correlation was 85% (p=0.15) when all patients were
considered, improving to 94% (p=0.06) for the positive responder group. This new
analysis was presented at the American Association for Cancer Research meeting
in March 2004. While this analysis would not meet the rigorous criteria of a
registration study, it suggests that these post-chemotherapy patients could be a
suitable patient population for a pivotal study of TroVax.
In 2003 Oxford BioMedica commenced two Phase II trials in the UK with TroVax in
Stage IV colorectal cancer patients who were receiving the current standard of
care chemotherapy. The objective of these trials is to investigate whether
chemotherapy affects the ability of patients to mount immune responses when
given TroVax.
The protocol of the first Phase II trial is a regime of six immunisations of
TroVax alongside chemotherapy cycles of irinotecan, 5-fluorouracil (5FU) and
leucovorin (a combination referred to as IFL). The second Phase II trial
protocol is TroVax alongside oxaliplatin, 5FU and leucovorin (referred to as
FOLFOX). Full recruitment is imminent across both trials with 36 of 37 projected
patients enrolled. The objective is to have ten evaluable patients in each
setting. The primary endpoints are safety and demonstrable anti-5T4 immune
responses.
Preliminary data from these Phase II trials indicate that the primary endpoints
have been achieved, that the combination is safe and that, despite receiving
chemotherapy, patients mount specific immune responses to the 5T4 antigen. A
total of 19 patients have been enrolled in the TroVax plus IFL trial. Ten
patients have reached an interim analysis point (defined as four TroVax
immunisations and more than eight cycles of chemotherapy). Nine out of the ten
patients have mounted specific anti-tumour immunological responses to the 5T4
antigen. The TroVax plus FOLFOX trial is fully recruited with 17 patients
enrolled. Three patients have reached the interim analysis point of four
immunisations and two of these have shown anti-5T4 immune responses to date.
The Company expects to report full safety and immunological data in mid-2005
when all patients will have received 12 cycles of chemotherapy and six
treatments of TroVax. At this time, tumour response rates will also be
determined.
In January 2004, the Company reported that Cancer Research UK had received
approval to start a Phase II trial with TroVax in colorectal cancer patients who
are to undergo surgery for resectable liver metastases. The trial is designed to
enrol 20 patients and recruitment is ongoing. In April 2004, the FDA approved
the Company's IND application to evaluate TroVax in patients with metastatic
renal cell cancer in combination with the current standard treatment,
interleukin-2. Following recent approval of the trial protocol at Columbia
Presbyterian Medical Center in New York, USA, projected recruitment of 30
patients is expected to commence shortly. Preliminary results on safety and
immunogenicity are expected in mid-2005.
The Company announced in March 2004 that a fifth Phase II trial with TroVax in
patients with Stage III/IV breast cancer is planned. The Southwest Oncology
Group (SWOG), a clinical research consortium sponsored by the US National Cancer
Institute, will conduct the trial. This will be the largest of the Phase II
trials with TroVax, recruiting about 120 patients. It is expected to start
before the end of the year.
Preparations for pivotal trials are continuing. The scale-up to commercial
manufacturing of TroVax, and bridging toxicology studies with the
commercial-grade material were completed earlier this year. A small clinical
safety study with this material is planned to start shortly in readiness for
Phase III trials. Following the encouraging Phase I/II and Phase II clinical
results in colorectal cancer, the Company has put together detailed plans for an
international Phase III trial in patients with Stage IV disease. These plans are
being discussed with potential partners.
MetXia(R)
MetXia is Oxford BioMedica's gene-based cancer therapeutic comprising a highly
engineered retrovirus that delivers a specific human cytochrome P450 gene to
tumour cells. The P450 enzyme activates the widely used cancer chemotherapy
drug, cyclophosphamide (CPA), to a form that is capable of destroying tumour
cells.
The second Phase I/II trial with MetXia in patients with breast cancer (and
other accessible tumour types) was completed in 2003. In December 2003, the
Company reported positive results that confirmed the safety, localised tumour
responses and systemic anti-tumour responses that were observed in the previous
MetXia trial. The full trial data are being documented for publication in a peer
reviewed journal and presentation at conferences.
In April 2004, the Company reported that recruitment had started, slightly ahead
of schedule, in a UK Phase I trial, rolling into a Phase II trial, of MetXia in
patients with pancreatic cancer. Unlike the earlier Phase I/II trials in breast
cancer, which used standard oral administration of CPA (causing activation of
CPA in the liver, with the toxicity normally associated with CPA), the
pancreatic cancer trial is designed for direct administration of both MetXia and
CPA to the tumour via arterial infusion. The Phase I safety stage of the trial
is on-track to complete by the end of the year, and this will be followed by the
Phase II efficacy stage. Endpoints include clinical responses and time to
disease progression. Patient recruitment is expected to exceed 25 patients.
On the basis of successful results in the Phase II stage of the trial, the
Company could advance to pivotal trials with MetXia in pancreatic cancer in
2006.
Neurotherapy
The neurotherapy portfolio comprises five products in late preclinical
development, all based on the Company's LentiVector technology. Preparations for
clinical trials with the lead product, ProSavin for Parkinson's disease, are at
an advanced stage. In the first half of 2004, the Company published preclinical
efficacy data for ProSavin, MoNuDin(R) for motor neuron disease and Innurex(R) for
nerve injury. New data, planned for publication, with the vision loss product,
RetinoStat(R), show initial efficacy in in vivo preclinical models.
ProSavin(R)
ProSavin is the Company's lead neurobiology product, and is designed for the
treatment of Parkinson's disease. It delivers genes required for dopamine
synthesis to neurons in the brain using the LentiVector gene delivery system.
Earlier this year, the Company reported that clinical trials would commence in
2005, a delay of a few months owing to extended product optimisation that has
enabled higher levels of dopamine to be produced per unit of drug.
The most recent preclinical efficacy data with ProSavin in an industry standard
in vivo model of Parkinson's disease were presented at the American Society for
Gene Therapy meeting in June 2004. The results showed almost complete recovery
to normal movement and behaviour following treatment with ProSavin.
The Company anticipates the start of clinical trials in 2005. The Phase I trial,
to be conducted at the John Radcliffe Hospital in Oxford, is expected to enrol
12 patients with late stage Parkinson's disease. The Company is completing
preclinical long-term toxicity and efficacy studies, and has had initial
discussions with the regulatory authorities prior to its submission for the
start of clinical trials.
RetinoStat(R)
RetinoStat is Oxford BioMedica's novel product for treatment of wet age-related
macular degeneration (AMD) and related diseases that lead to vision loss. Two
versions of RetinoStat are being evaluated, which comprise either two novel
angiogenesis inhibitor genes, endostatin and angiostatin, or endostatin alone,
delivered to the eye via the LentiVector system.
This year, extensive preclinical studies are being conducted at the Institute of
Ophthalmology in London and at the Johns Hopkins Hospital in Baltimore, USA,
with financial support from the US charity Foundation Fighting Blindness. Recent
data from in vivo models of wet AMD and macular oedema show reduction in
aberrant angiogenesis (blood vessel growth) and permeability (blood vessel
leakage) with the version of RetinoStat that delivers endostatin alone. Studies
are ongoing with the version containing both genes. These results together with
data from the other studies currently in progress will be published and
presented at relevant conferences and will form the basis of the clinical
development programme.
MoNuDin(R)
MoNuDin is the Company's novel treatment for degeneration of motor neurons that
occurs in diseases such as amyotrophic lateral sclerosis (ALS). This
LentiVector-based product delivers the neuroprotective gene for vascular
endothelial growth factor to motor neurons via intramuscular injection.
In May 2004, preclinical in vivo efficacy data in an industry standard model of
ALS were published in Nature. These showed that both the onset and progression
of disease were slowed and life expectancy was extended by 30% with MoNuDin
treatment. The results suggest that MoNuDin is one of the most effective
potential therapies in the field to date. The Company is planning a clinical
development strategy for the product.
Innurex(R)
Innurex is Oxford BioMedica's novel treatment for nerve regeneration in
applications including spinal cord injuries. Again based on the LentiVector
technology, the product carries the gene RARB2 (a subtype of the retinoic acid
receptor) that induces nerve cells to regrow by a process known as 'sprouting'.
Following a scientific presentation in December 2003 of preclinical data showing
that Innurex stimulates nerve sprouting, further data were presented in June
2004 showing restoration of limb function. In a presentation at the American
Society for Gene Therapy meeting, Oxford BioMedica scientists showed that
Innurex restores function to damaged limbs in a preclinical model of avulsion
(stretch) injury. These results indicate that Innurex may benefit patients with
nerve damage resulting from severe pull or stretch injury, a common consequence
of sporting and motor accidents. Further preclinical studies and clinical
planning are underway.
The Company's collaborator on Innurex, Kings College London, was awarded a grant
of $150,000 for the programme in April 2004 from the Christopher Reeve Paralysis
Foundation. This grant supports studies on the use of Innurex in spinal cord
injury.
LentiVector(R) Technology
Oxford BioMedica's LentiVector technology is one of the most potent gene
delivery systems currently available, particularly for the treatment of chronic
neurodegenerative disorders. It is also an effective tool for genomics-based
target validation, screening, production systems, and the creation of transgenic
animals.
In February 2004, the Company signed an agreement with Merck & Co granting
non-exclusive worldwide rights to the LentiVector technology for research
activities. Oxford BioMedica received an upfront license payment and is entitled
to an annual maintenance fee. In June 2004, another LentiVector license
agreement was signed with Viragen for use of the technology in the development
of avian transgenics for efficient and economical manufacturing of therapeutic
proteins in chicken eggs. The Viragen agreement includes upfront and annual
license payments in addition to milestone payments on the achievement of
technical goals, and royalties on commercialisation.
This year, the Company has broadened the therapeutic applications of the
LentiVector technology beyond its neurotherapy focus.
In March 2004, the UK Department of Health awarded the Company a grant of £0.5
million to develop novel treatments for single gene disorders with a focus on
the blood clotting disorder, haemophilia A, which is caused by a defective
Factor VIII gene. Oxford BioMedica has developed a product, named Requinate(R),
that carries a corrected version of the Factor VIII gene in a LentiVector
system. Since haemophilia falls outside of the Company's therapeutic focus of
cancer and neurotherapy, the programme has received minimal internal resources
up to now. The new money from the Department of Health will enable the Company
to progress the programme without compromising progress of the cancer and
neurotherapy products. Preclinical studies with the product have started, and
initial data are encouraging.
In August 2004, Oxford BioMedica scientists presented preclinical data at the
American Society for Neurochemistry conference showing that a LentiVector-based
product delivering short interfering RNA (siRNA) can dramatically slow down the
development of symptoms and increase life expectancy in a preclinical model of
an inherited neurodegenerative disease. The delivery of siRNA with the
LentiVector technology is potentially applicable in any disease where it is
important to suppress gene activity, including, for example, cancer and AIDS.
Patents
Strengthening the intellectual property protection for the development products
and technologies remains a core activity for the Company. One new filing was
made in the first half of the year and eight patents were granted. The Company
has the broadest global patent estate for lentiviral vectors, which supports the
LentiVector-based pipeline and has created licensing opportunities, such as the
agreements with Merck & Co and Viragen. In June 2004, Oxford BioMedica acquired
a number of patent families from Chiron Corporation's gene therapy patent
portfolio that complement the Company's existing intellectual property.
Separately, Chiron made an equity investment in Oxford BioMedica and holds about
0.1% of the Company's shares.
Finance
The financial position remains strong and the Company has continued to invest in
its expanded clinical development programme, while maintaining tight control
over spending. The restructuring of the US operation is complete, and provision
has been made in the June 2004 accounts for the estimated total costs of this
reorganisation. The net loss of £6.8 million for the first half of 2004 (H1
2003: £5.6 million) includes exceptional costs of £1.6 million in respect of the
reorganisation. As a result of making provisions for the estimated total costs
of restructuring in the first half of 2004, the Company expects that net
operating expenses for the second half will be approximately £1.5 million lower
than the first half.
Revenue of £293,000 (H1 2003: £110,000) included the initial payment under the
agreement with Viragen, and a proportion of the first-year licence fee from
Merck & Co was recognised as revenue in the first half. Altogether £208,000
(71%) of the first half of 2004 turnover derived from the LentiVector
technology.
Research and development costs and administration expenses were unchanged from
the first half of 2003 at £5.4 million and £1.5 million respectively, despite an
increase of over 60% in external clinical and preclinical costs, which amounted
to £1.7 million in the first half of 2004 (H1 2003: £1.0 million). This
continues a trend of curtailing in-house research costs in order to fund the
clinical development programme. Including the £1.6 million restructuring costs,
total operating expenses in the first half of 2004 were £8.4 million (H1 2003:
£6.9 million). The cash impact of the reorganisation in the first half of 2004
was relatively modest at £129,000 with the bulk of the exceptional cost made up
of non-cash items comprising the write down of assets, losses on sale of fixed
assets, a provision for the US office lease and accrued costs of £238,000
payable mostly in the second half.
Grant income of £229,000 was similar to the level in the second half of 2003,
although a higher figure of £432,000 was recorded in the first half of 2003 as
this period included arrears from 2002 on two grant programmes. Two new grants
were awarded in the first half of 2004: Oxford BioMedica was awarded a grant of
approximately £0.5 million by the UK Department of Health for the clinical
development of Requinate for the treatment of haemophilia A, and the Company is
part of a European consortium which has received a grant under the European
Community Framework 6 scheme.
Before the exceptional item, the loss before interest was £6.3 million (H1 2003:
£6.4 million). Including exceptional costs, the operating loss was £7.9 million
(H1 2003: £6.4 million).
Interest receivable was significantly higher at £616,000 (H1 2003: £322,000) as
a result of higher cash balances following the rights issue in October 2003 and
generally higher interest rates. The tax credit was £536,000 (H1 2003:
£532,000). Further weakening of the US dollar resulted in currency translation
losses of £55,000 (H1 2003: £52,000) making total recognised losses of £6.8
million (H1 2003: £5.6 million).
Capital expenditure in the first half of 2004 was £229,000 (H1 2003: £35,000).
However this was less than the depreciation charge, and, together with the sale
and write down of assets in the US, the book value of fixed assets was
significantly lower at £1.6 million (30 June 2003: £3.1 million).
Debtors of £3.7 million were £2.1 million higher than 2003. The increase was due
principally to the timing of tax credit, bank interest and government grant
receipts. The UK R&D tax credit debtor at 30 June 2004 of £1,785,000 covers the
18-month period from January 2003 to June 2004 (2003: £546,000 covering the six
months January to June 2003). The tax credit is paid in arrears and, while the
2002 claim was settled during June 2003, the 2003 claim was still under review
at 30 June 2004. At 30 June 2004 there was £567,000 (2003: £23,000) accrued bank
interest on term deposits which mostly mature in the second half, and £367,000
(2003: £122,000) accrued grant income.
The adverse effect of higher debtors on the cash flow was partly offset by
higher creditors. Accruals and deferred income were £1.7 million (2003: £1.1
million), with the main increases being external clinical and preclinical costs
and accrued US reorganisation costs. Provisions for liabilities and charges of
£569,000 (2003: £17,000) related to the US office lease, whereas the 2003 figure
covered deferred tax.
The net cash outflow before management of liquid resources and financing (often
referred to as the cash burn) was £5.7 million in the first half of 2004 (H1
2003: £3.8 million). This includes £129,000 relating to the US reorganisation,
and compares favourably to a cash burn of £5.8 million in the second half of
2003. The difference between the first halves of 2004 and 2003 is mainly due to
the timing of the receipt of R&D tax credit. Capital expenditure and the timing
of bank interest receipts were also favourable in the first half of 2003.
The issue of shares in the first half of 2004 brought proceeds of £170,000 from
the exercise of share options. A further £56,000 proceeds from the issue of
shares to Chiron in June 2004 was received in August.
Cash and short-term investments at 30 June 2004 were £26.2 million (2003: £17.2
million). The Company expects lower cash consumption in the second half of 2004
compared to the first half, with the full year cash burn expected to be under
£11 million. Based on detailed financial models and spending plans, the current
resources are sufficient to fund existing operations into 2007, without any new
sources of revenue.
Outlook
In the 2003 Annual Report, the Company outlined its expectation for clinical and
preclinical data and new collaborations in 2004 and 2005. In oncology, -four of
the five planned Phase II trials with TroVax, and the clinical trial with MetXia
in pancreatic cancer are underway, with initial data from two trials of TroVax
showing highly encouraging findings. Further Phase II trial results with both
TroVax and MetXia are anticipated over the next 12 months.
In neurotherapy, the Company plans to start clinical trials with ProSavin in
2005 and anticipates at least one IND (US) or CTA (UK) each year thereafter from
the neurotherapy pipeline. Preclinical efficacy data has been published or
presented at scientific meetings this year on three of the five pipeline
products. The Company expects further publications in the next 12 months.
The LentiVector technology has broad utility in the treatment of
neurodegenerative and ophthalmic diseases. The Company is investigating novel
LentiVector-based products, which could expand the current neurotherapy
portfolio and has also created product opportunities in other therapeutic areas.
Two licensing agreements were signed for the LentiVector technology in the first
half and more are anticipated. Licensing discussions for the lead cancer and
neurotherapy products as well as the Company's other technologies are also
ongoing.
The remainder of this year and 2005 could see substantial value generation for
the Company through progress in product development and corporate licensing.
Dr Peter Johnson Professor Alan Kingsman
Chairman Chief Executive Officer
Consolidated profit and loss account
for the six months ended 30 June 2004
------------------------ ------ --------- --------- ---------
Notes Six months Six months Year ended
ended ended 31 December
30 June 2004 30 June 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
------------------------ ------ --------- --------- ---------
Turnover 2 293 110 374
------------------------ ------ --------- --------- ---------
Research and development (5,392) (5,420) (10,773)
costs
Administrative expenses (1,456) (1,528) (2,922)
Exceptional 3 (1,578) - -
administrative expenses
------------------------ ------ --------- --------- ---------
Operating expenses (8,426) (6,948) (13,695)
Other operating income: 229 432 669
grants receivable
------------------------ ------ --------- --------- ---------
Net operating expenses (8,197) (6,516) (13,026)
------------------------ ------ --------- --------- ---------
Loss before interest and (6,326) (6,406) (12,652)
exceptional item
Exceptional item 3 (1,578) - -
------------------------ ------ --------- --------- ---------
Operating loss (7,904) (6,406) (12,652)
Interest receivable 616 322 711
------------------------ ------ --------- --------- ---------
Loss on ordinary (7,288) (6,084) (11,941)
activities before
taxation
Tax credit on loss on 536 532 1,203
ordinary activities
------------------------ ------ --------- --------- ---------
Loss for the period (6,752) (5,552) (10,738)
------------------------ ------ --------- --------- ---------
Basic loss and diluted 4 (1.8p) (2.2p) (3.9p)
loss per ordinary share
------------------------ ------ --------- --------- ---------
The results for the periods above are derived entirely from continuing
operations.
There is no difference between the loss on ordinary activities before taxation
and the loss for the periods stated above, and their historical cost
equivalents.
Statement of group total recognised gains and losses
------------------------- ----- --------- --------- ---------
Notes Six months Six months Year ended
ended ended 31 December
30 June 2004 30 June 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
------------------------- ----- --------- --------- ---------
Loss for the financial (6,752) (5,552) (10,738)
period
Currency translation 9 (55) (52) (179)
differences on foreign
currency net investments
------------------------- ----- --------- --------- ---------
Total recognised losses (6,807) (5,604) (10,917)
for the period
------------------------- ----- --------- --------- ---------
Consolidated balance sheet
at 30 June 2004
------------------------ ------ --------- --------- ---------
Notes 30 June 30 June 31 December
2004 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
------------------------ ------ --------- --------- ---------
Fixed assets
Intangible assets 111 160 135
Tangible assets 5 1,509 2,919 2,331
Investments 26 26 26
------------------------ ------ --------- --------- ---------
1,646 3,105 2,492
------------------------ ------ --------- --------- ---------
Current assets
Debtors 6 3,665 1,571 2,386
Investments 25,813 16,487 31,700
Cash at bank and in hand 432 748 136
------------------------ ------ --------- --------- ---------
29,910 18,806 34,222
Creditors: amounts falling 7 (2,376) (1,876) (1,501)
due within one year
------------------------ ------ --------- --------- ---------
Net current assets 27,534 16,930 32,721
------------------------ ------ --------- --------- ---------
Total assets less current 29,180 20,035 35,213
liabilities
Provisions for liabilities 8 (569) (17) -
and charges
------------------------ ------ --------- --------- ---------
Net assets 28,611 20,018 35,213
------------------------ ------ --------- --------- ---------
Capital and reserves
Called-up share capital 3,716 2,397 3,703
Share premium account 78,237 58,843 78,045
Other reserve 711 711 711
Profit and loss account (54,053) (41,933) (47,246)
(deficit)
------------------------ ------ --------- --------- ---------
Equity shareholders' 9 28,611 20,018 35,213
funds
------------------------ ------ --------- --------- ---------
Consolidated cash flow statement
for the six months ended 30 June 2004
------------------------ ------ --------- --------- ---------
Notes Six months Six months Year ended
ended ended 31 December
30 June 2004 30 June 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
------------------------ ------ --------- --------- ---------
Operating activities A (5,790) (5,485) (11,488)
Net cash outflow from
continuing operating
activities
------------------------ ------ --------- --------- ---------
Returns on investments
and servicing of
finance
Interest received 166 343 638
------------------------ ------ --------- --------- ---------
Taxation
Tax credit received - 1,260 1,259
Overseas tax received - - 8
------------------------ ------ --------- --------- ---------
- 1,260 1,267
------------------------ ------ --------- --------- ---------
Capital expenditure
(Purchase)/net refund of (228) 57 (51)
tangible fixed assets
Sale of tangible fixed 105 - -
assets
------------------------ ------ --------- --------- ---------
(123) 57 (51)
------------------------ ------ --------- --------- ---------
Net cash outflow before (5,747) (3,825) (9,634)
management of liquid
resources and financing
------------------------ ------ --------- --------- ---------
Management of liquid
resources
Transfer to deposit (3) (5) (12,368)
accounts
Transfer to current 5,890 4,179 1,329
accounts
------------------------ ------ --------- --------- ---------
5,887 4,174 (11,039)
------------------------ ------ --------- --------- ---------
Financing
Issue of ordinary 170 90 22,215
shares
Expenses of share (10) - (1,695)
issues
------------------------ ------ --------- --------- ---------
Net cash inflow from 160 90 20,520
financing
------------------------ ------ --------- --------- ---------
------------------------ ------ --------- --------- ---------
Increase/(decrease) in B 300 439 (153)
cash in the period
------------------------ ------ --------- --------- ---------
Notes to the consolidated cash flow statement
for the six months ended 30 June 2004
---------------------------- --------- --------- ---------
(A) Reconciliation of operating Six months Six months Year ended
loss to net cash outflow from ended ended 31 December
operating activities 30 June 2004 30 June 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
---------------------------- --------- --------- ---------
Continuing activities
Operating loss (7,904) (6,406) (12,652)
Amortisation of intangible fixed 24 25 50
assets
Depreciation of tangible fixed 741 481 943
assets
Loss on disposal of fixed 181 - 71
assets
Non-cash consideration for - - 79
acquired intellectual property
rights
Increase in trade debtors (195) (33) -
Increase in other debtors and (95) (137) (232)
other tax receivable
Decrease/(increase) in 96 21 (18)
prepayments and accrued income
Increase/(decrease) in trade 260 236 (74)
creditors
(Decrease)/increase in other (99) (72) 31
taxation and social security
Increase in accruals and deferred 651 425 360
income
Increase in provisions 569 - -
Exchange rate differences (19) (25) (46)
---------------------------- --------- --------- ---------
Net cash outflow from continuing (5,790) (5,485) (11,488)
operating activities
---------------------------- --------- --------- ---------
---------------------------- --------- --------- ---------
(B) Reconciliation of net cash Six months Six months Year ended
flow to movement in net funds ended ended 31 December
30 June 2004 30 June 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
---------------------------- --------- --------- ---------
Increase/(decrease) in cash in 300 439 (153)
the period
Cash (inflow)/outflow from change (5,887) (4,174) 11,039
in liquid resources
---------------------------- --------- --------- ---------
Change in net funds resulting (5,587) (3,735) 10,886
from cash flows
Exchange movements (4) 6 (14)
Net funds at beginning of the 31,836 20,964 20,964
period
---------------------------- --------- --------- ---------
Net funds at 30 June/31 26,245 17,235 31,836
December
---------------------------- --------- --------- ---------
--------------------- -------- --------- --------- ---------
(C) Analysis of net At 1 January Exchange
funds 2004 Cash flow movements At 30 June 2004
£'000 £'000 £'000 £'000
--------------------- -------- --------- --------- ---------
Cash 136 300 (4) 432
Liquid resources 31,700 (5,887) - 25,813
--------------------- -------- --------- --------- ---------
Net funds 31,836 (5,587) (4) 26,245
--------------------- -------- --------- --------- ---------
Liquid resources relate to bank deposits which are not immediately accessible
within 24 hours without financial penalty.
Notes to accounts
1 Basis of preparation
The interim financial information has been prepared in accordance with the
accounting policies set out in the Group's Report and Accounts for the year
ended 31 December 2003.
These interim financial statements do not constitute statutory financial
statements within the meaning of s240 of the Companies Act 1985. Results for the
six month periods ended 30 June 2004 and 30 June 2003 have not been audited. The
financial information for the year ended 31 December 2003 is derived from the
statutory accounts for that year, which have been delivered to the Registrar of
Companies. The report of the auditors on those accounts was unqualified.
Copies of the interim results for the six months ended 30 June 2004 are being
sent to all shareholders. Details can also be found on the Company's website at
www.oxfordbiomedica.co.uk. Further copies of the interim results and copies of
the full report and accounts for the year ended 31 December 2003 can be obtained
by writing to the Company Secretary, Oxford BioMedica plc, Medawar Centre,
Oxford Science Park, Oxford, OX4 4GA.
This announcement was approved by the Board of Oxford BioMedica plc on 31 August
2004.
2 Turnover and loss on ordinary activities before taxation
The Group's turnover and loss on ordinary activities before taxation are derived
entirely from its principal activity.
Six months ended Six months ended Year ended
30 June 2004 30 June 2003 31 December 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Turnover Turnover by Turnover by Turnover by Turnover by Turnover by Turnover by
destination origin destination origin destination origin
Geographical £'000 £'000 £'000 £'000 £'000 £'000
analysis -------- ------- -------- ------- -------- --------
----------------
United Kingdom 35 293 28 110 29 374
North America 258 - 82 - 345 -
---------------- -------- ------- -------- ------- -------- --------
293 293 110 110 374 374
---------------- -------- ------- -------- ------- -------- --------
---------- --------- ---------
Loss on ordinary activities Six months Six months Year ended
before taxation ended ended 31 December
30 June 2004 30 June 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Geographical analysis
--------------------------- ---------- --------- ---------
United Kingdom 5,045 4,077 8,693
North America 2,243 2,007 3,248
--------------------------- ---------- --------- ---------
7,288 6,084 11,941
--------------------------- ---------- --------- ---------
---------- --------- ---------
Net assets/(liabilities) 30 June 30 June 31 December
2004 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Geographical analysis
--------------------------- ---------- --------- ---------
United Kingdom 3,004 1,551 2,216
North America (638) 1,232 1,161
--------------------------- ---------- --------- ---------
Net operating assets 2,366 2,783 3,377
Net funds 26,245 17,235 31,836
--------------------------- ---------- --------- ---------
28,611 20,018 35,213
--------------------------- ---------- --------- ---------
3 Exceptional item: reorganisation of US activities
In January 2004, following a review of operations and resources, the Group
closed its US process development and manufacturing unit. A business development
and intellectual property management capability has been retained, and the US
subsidiary has sublet its leasehold facility and relocated to new premises.
Provision has been made for the estimated total cost of this reorganisation in
the accounts for the six months ended 30 June 2004.
Exceptional costs of £1,578,000 included in the accounts for the six month
period ended 30 June 2004 comprised: £181,000 loss on disposal of fixed assets,
£356,000 write down of tangible fixed assets included in depreciation of fixed
assets, £569,000 onerous lease charge, £253,000 severance payments and £219,000
other reorganisation costs. The cash outflow attributable to the exceptional
item in the six months ended 30 June 2004, net of the proceeds of sale of fixed
assets, was £129,000.
4 Basic loss and diluted loss per ordinary share
The basic loss per share has been calculated by dividing the loss for the period
by the weighted average number of shares of 371,046,099 in issue during the six
months ended 30 June 2004 (six months ended 30 June 2003: 252,252,285; year
ended 31 December 2003: 273,876,723). The number of shares in issue prior to the
rights issue in October 2003 has been adjusted as required by FRS 14 (Earnings
per Share).
The Company had no dilutive potential ordinary shares in either period which
would serve to increase the loss per ordinary share. There is therefore no
difference between the loss per ordinary share and the diluted loss per ordinary
share.
5 Tangible fixed assets
Short Office Computer Laboratory Total
leasehold equipment, equipment equipment
improvements fixtures
and fittings
£'000 £'000 £'000 £'000 £'000
------------------- --------- -------- --------- -------- ------
Cost
At 1 January 2004 2,238 231 325 2,871 5,665
Additions - 2 10 217 229
Disposals - (11) (13) (438) (462)
Exchange (6) (1) (1) (23) (31)
differences
------------------- --------- -------- --------- -------- ------
At 30 June 2004 2,232 221 321 2,627 5,401
------------------- --------- -------- --------- -------- ------
Depreciation
At 1 January 2004 1,195 154 254 1,731 3,334
Charge for the 448 38 44 211 741
period
Disposals - (4) (9) (163) (176)
Exchange 1 - - (8) (7)
differences
------------------- --------- -------- --------- -------- ------
At 30 June 2004 1,644 188 289 1,771 3,892
------------------- --------- -------- --------- -------- ------
Net book amount at 588 33 32 856 1,509
30 June 2004
------------------- --------- -------- --------- -------- ------
Net book amount at 1,235 94 120 1,470 2,919
30 June 2003
------------------- --------- -------- --------- -------- ------
Net book amount at 1,043 77 71 1,140 2,331
31 December 2003
------------------- --------- -------- --------- -------- ------
Included in the depreciation charge for the period is a £356,000 write down of
assets in connection with the reorganisation of US activities (see note 3).
6 Debtors
----------------------------- --------- -------- ---------
30 June 30 June 31 December
2004 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
----------------------------- --------- -------- ---------
Amounts falling due after more than
one year
Other debtors - rent deposit 259 284 263
----------------------------- --------- -------- ---------
Amounts falling due within one
year
Trade debtors 195 33 -
Other debtors 992 148 374
Corporation tax receivable 1,785 546 1,200
Other tax receivable 89 151 107
Prepayments and accrued income 345 409 442
----------------------------- --------- -------- ---------
3,406 1,287 2,123
----------------------------- --------- -------- ---------
Total debtors 3,665 1,571 2,386
----------------------------- --------- -------- ---------
7 Creditors: amounts falling due within one year
----------------------------- --------- -------- ---------
30 June 30 June 31 December
2004 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
----------------------------- --------- -------- ---------
Trade creditors 570 653 310
Overseas taxation 49 - -
Other taxation and social 96 92 195
security
Accruals and deferred income 1,661 1,131 996
----------------------------- --------- -------- ---------
2,376 1,876 1,501
----------------------------- --------- -------- ---------
8 Provisions for liabilities and charges
----------------------------- --------- -------- ---------
30 June 30 June 31 December
2004 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
----------------------------- --------- -------- ---------
Deferred tax - 17 -
Onerous lease 569 - -
----------------------------- --------- -------- ---------
569 17 -
----------------------------- --------- -------- ---------
The onerous lease provision relates to the estimated rental shortfall in respect
of the property in San Diego, USA, discounted at 4.17% per annum, and will be
utilised over the term of the lease which is due to expire in 2012.
9 Reconciliation of movements in Group shareholders' funds
--------------------------- --------- --------- ---------
Six months Six months Year ended
ended ended 31 December
30 June 2004 30 June 2003 2003
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
--------------------------- --------- --------- ---------
Loss for the period (6,752) (5,552) (10,738)
New share capital issued 226 90 22,294
Expenses of share issue (21) - (1,696)
Exchange differences (55) (52) (179)
--------------------------- --------- --------- ---------
Net movement in shareholders' (6,602) (5,514) 9,681
funds
Opening shareholders' funds 35,213 25,532 25,532
--------------------------- --------- --------- ---------
Closing shareholders' funds 28,611 20,018 35,213
--------------------------- --------- --------- ---------
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