“Pivotal Period for ValiRx Sees Continued Excellent Progress”
HIGHLIGHTS
- Revenue for the year increased by 157% to £455,000 (2010: £177,000).
- Significant advances seen in the development and progress of both therapeutic compounds, VAL101 and VAL201, in their respective pre-clinical and translational programmes and towards in-human Phase I clinical trials.
- Acquisition from Pharmatest Services Oy ("Pharmatest") of Oulu, Finland, of its biomarkers business unit, patent families and applications and related IP, by subsidiary, ValiRx Finland OY ("ValiFinn"). This provides the Company with exposure to both the key and increasingly exciting biomarkers market and to new revenue streams.
- Receipt of USD1.11 million proceeds from the sale of Belgian subsidiary diagnostic development business, ValiBIO S.A. to Singapore Volition Pte. Ltd ("Volition"). The transaction, which was completed in the 2010 financial year, sees ValiRx satisfactorily exit from its investment whilst retaining a modest shareholding in Volition, whilst also retaining certain rights to use the technologies sold for use in ValiRx’s therapeutic programmes and products.
- February 2011 - £3.3 million Placing by Hybridan - a key milestone in providing the Company with a secure base of funding from which the pre-clinical progress of its therapeutics can be accelerated.
Dr Satu Vainikka, CEO of ValiRx, commented:
“We have made excellent progress over the past year, which included a significant capital injection, a strengthened balance sheet and with the Company's lead therapeutic products being on the cusp of clinical trials. We have a strong platform and offering from which to drive ValiRx forward and firmly position ourselves at the forefront of personalised oncology diagnostic and therapeutics development in the sector”.
Posting of Accounts and Notice of Annual General Meeting
Included in the accounts, which are expected to be posted to shareholders 2 May 20012, is a notice to shareholders convening the Annual General Meeting of the Company to be held at the offices of Nabarro LLP, Lacon House, 84 Theobald's Road, London WC1X 8RW, on 29 May 2012 at 10:00 a.m..
CHAIRMAN'S REPORT FOR THE YEAR ENDED 31 DECEMBER 2011
I am pleased to report that during the twelve months ended 31 December 2011 your Company continued to develop strongly, both in terms of providing a well funded platform for drug development and in terms of the progress and development of its lead therapeutic compounds VAL101 and VAL201 and their progress towards the commencement of in-human clinical trials. Your Company continues to work with world class regulatory and clinical research organizations to ensure that these developments occur on a cost effective and timely basis.
The February 2011 Placing through Hybridan to raise £3.3 million was a key milestone in providing ValiRx with a secure base of funding from which the Company can accelerate the pre-clinical progress of VAL101 and VAL201 among other activities and further progress the business.
The period also saw the establishment of our subsidiary, ValiRx Finland OY ("ValiFinn"), in Finland and the acquisition from Pharmatest Services Oy ("Pharmatest") of Oulu, Finland, of its biomarkers business unit together with several families of patents and patent applications and related intellectual property ("IP"). This acquisition provides the Group with both an increased exposure to the Biomarker market, a key and increasingly exciting field within our industry, but also to a revenue stream, derived from the provision of contract services.
In 2011, we received the proceeds from the sale of our Belgian subsidiary diagnostic development business, ValiBIO S.A. to Singapore Volition Pte. Ltd ("Volition"). This was a business, which the board considered lay outside the Company's core technologies. However, we have retained the rights to the technologies for use in our therapeutic activities. Whilst we retain a modest interest and shareholding in its future growth, we are pleased to have satisfactorily exited from one of our investments.
Our progress during the period under review has been very encouraging and I am delighted that the business is more strongly established than ever before, and is now in a position to fully capitalise on both current opportunities and future successes. Going forward, I look forward to seeing our lead therapeutics continue to progress and our position in the biotechnology market strengthen further. We are well positioned and I look forward to the future with much confidence.
On a personal note I would also like to thank the executive team and the non-executive directors for the significant contribution both groups have made to the business over the last twelve months.
N Thorniley
Non-exec Chairman
ValiRx plc
CHIEF EXECUTIVE OFFICER'S REPORT FOR THE YEAR ENDED 31 DECEMBER 2011
The past year has been a fundamentally important period in the development of ValiRx, both as a company and in terms of the advancement of its various programmes. On all fronts, ValiRx has made good progress.
Revenues for the year were £455,000 (2010: £177,000). Administrative expenses were £1,513,000 (2010: £663,000). Included in administrative expenses were research and development costs of £421,000 (2010: £120,000). Losses after taxation were £933,000 (2010: profit £133,000).
I am pleased to report that over the year we continued to make good progress in terms of developing our cancer therapeutics and biomarker diagnostics with significant advances being seen regarding moving forward both therapeutic compounds, VAL101 and VAL201, in their respective pre-clinical and translational programmes.
VAL101
Continued strong progress has been seen with regard to the Eurostars programme for our lead therapeutic, VAL101 and for the GeneICE technology (or "Gene inactivation by chromatin engineering"), ValiRx's proprietary gene-silencing technology which has been developed for silencing or "freezing" rebellious genes, which cause conditions such as cancer and various neurological problems.
We continue to meet the milestones as set out in a programme and are pleased to have optimised and simplified the production of the lead candidate molecule, which by extension makes the compound cheaper to produce, thereby adding future value. We believe this compound has the potential to deliver good biological activity and can complete preclinical studies efficiently and quickly.
Imperial College, University of London, from whom the technology was originally licensed, has been working in collaboration with the Company and is currently carrying out the late preclinical development. Results from the preclinical programme have shown efficacy in killing cancer cells in several systems, as the Company has reported previously, and ValiRx was delighted to announce that its agreement with Imperial College had been extended and that Imperial College would continue with the further development of this cancer therapeutic work. Stability and toxicology studies are currently underway.
We were also pleased to report that the previously announced extension to our Eurostars grant for the development of our GeneICE technology will extend the Company's pipeline of potential cancer therapeutic compounds.
VAL201
We were also pleased to report (28 July 2011) that a further late preclinical study into the development of another of our lead therapeutics, VAL201, carried out in collaboration with Oxford University, firmly established a potentially important role for VAL201 in treating, in vivo, hormone induced refractory prostate cancer and other conditions of hormone induced uncontrolled cell growth including breast and ovarian cancer, among others. These conditions currently have a large unmet medical need.
This progress follows on from ValiRx's agreement with Oxford University, (14 April 2011) to accelerate the development of this lead therapeutic and to study VAL201's therapeutic potential for additional indications. In the studies thus far, VAL201 has been shown to prevent cancerous growth in live models, with two proliferative conditions and in a further three conditions in cancer cell lines. The response was shown to be dose dependent and the Company was pleased to note that those models treated with VAL201 remained fertile and produced normal offspring and, unlike many other traditional therapies, no serious side effects were seen so far. ValiRx further announced on 2 November 2011 that it had filed a new patent for a further indication in endometriosis or hormone induced abnormal cell growth in women.
The compound is now in the translational phase from pre-clinical development into the clinical stage. Good progress has been made and it is gratifying to report that the production methods and procedures for the manufacture of VAL201 has been successfully upgraded to a standard that is acceptable for use in human, a process known as Good Manufacturing Practise or GMP. This GMP material is being used for the compulsory chronic and acute toxicological studies, which are being carried out to the highest ethical and regulatory standards. It is also pleasing to report that confirmatory pre-clinical studies, paid for by ValiRx, but conducted by independent contractors, have demonstrated the utility of VAL201 in controlling the proliferation of cancers - thereby confirming the results previously found by the Company and its collaborators.
Diagnostics and Biomarker Activities
With respect to the Company's diagnostics and biomarker activities, ValiRx was pleased to have acquired (18 August 2011) the outstanding equity of a subsidiary business, ValiRx Finland Oy ("ValiFinn Oy") that it had jointly established with local partners in 2008. Subsequent to this transaction and just after the period end, ValiFinn acquired (5 January 2012) from Pharmatest Services Oy ("Pharmatest") of Oulu, Finland, its biomarkers business unit together with several families of patents and patent applications and related intellectual property ("IP").
The biomarkers business unit comes with a revenue stream, which is derived from the provision of contract research services to pharmaceutical companies who are utilising its library of biomarkers and it will form a new division at ValiFinn. The Company will build on the specialist biomarker expertise of ValiFinn to develop its own companion diagnostic biomarkers to complement ValiRx's therapeutics, its existing intellectual property and its companion diagnostic activities, as well as marketing that expertise for the development programmes of other companies.
Biomarkers are a fast moving and currently very dynamic field within the bio-industry space and are crucial for detecting cancer at an early stage. They are also key in optimising therapeutic strategy and monitoring therapeutic success. It is a market that is rapidly growing in size and it has the potential of delivering significant benefit for patients, alongside potential cost savings derived from across the pharmaceutical industry.
SELFCheck Health Screening Products
ValiRx is also continuing to generate revenues from its SELFCheck "Over-The-Counter" health screening products in the UK, which screen and identify among other things, cancers, cholesterol and several Sexually Transmitted Infections ("STI") such as Chlamydia. During the period, we were pleased to conclude an agreement with Medcase OY MCO ("Medcase"), a Finnish distributor operating across the Nordic region, for the distribution and sale of our SELFCheck test kits in Finland and Sweden, among other key distribution agreements.
Collaborative Agreements
During the period, ValiRx was pleased to have secured several developmental collaborative agreements, with prestigious partners including Oxford University, Imperial College, and Physiomics plc (AIM: PYC), the Oxford based systems biology company. We are delighted that the Company continues to attract world-leading institutions to partner with us in the exciting development of a number of our key compounds and we thank them for their support.
ValiBIO S.A.
In 2011, your Company received the proceeds from the sale of its Belgian subsidiary diagnostic development business, ValiBIO S.A. to Singapore Volition Pte. Ltd ("Volition"). ValiRx continues to retain its modest shareholding in Volition and interest in the future upside value and growth of the business, whilst both satisfactorily exiting from one of its investments yet retaining rights to use the technologies sold for its own use with its therapeutic programmes and products. ValiRx has since received further shares in Volition in exchange for wider rights to its Hypergenomics Intellectual Property ("IP"), which the board considered lay outside the Company's core technologies.
Grant of Patents
We were also pleased to announce just before the period end (15 December 2011) that GeneICE had received patent approval by the Canadian patent office. This followed the previously announced grant of patents for the technology across the world encompassing territories including the US, Europe and Australia. The filing of this latest patent extends the Company's global geographic patent coverage and we believe, increases the value of the Company's assets.
Fund Raising
ValiRx also raised further capital of £3.3 million by way of a placing, (announced 16 February 2011). The net proceeds of the Placing are currently being used by the Company to accelerate the pre-clinical progress of VAL101 and VAL201, to support the sales and marketing activities of ValiRx's subsidiary, Valimedix, to develop the Company's companion diagnostics for use in its therapeutic programmes and to support the development and testing of its HPV diagnostic.
Outlook
Looking to the future, we will continue to progress our lead development programmes towards clinical trials and further advance the development pipeline. The placing and capital raised has left the Company well positioned to translate and move forward its therapeutic programmes towards the clinic and also to further advance the business and programme development of its biomarker subsidiary. I believe that the Company has made excellent progress over the past year, which included a significant capital injection, a strengthened balance sheet and with the Company's lead therapeutic products being on the cusp of clinical trials. We have a strong platform and offering from which to drive ValiRx forward and firmly position ourselves at the forefront of personalised oncology diagnostic and therapeutics development in the sector.
Satu Vainikka
Chief Executive Officer
ValiRx plc
