For immediate release: 10am - 28th September 2007
VALIRX PLC
("ValiRx" or the "Company")
Interim Results for the Six Months ended 30 June 2007
ValiRx Plc (AIM: VAL), the cancer therapeutics company, today announces its
unaudited interim results for the six month period ended 30 June 2007.
CHAIRMAN'S REPORT
For the Period Ended 30 June 2007
I am pleased to report that during the six month period ended 30 June 2007 and
the subsequent period to date, the business has continued to develop steadily
across its three chosen areas of focus.
Science
We believe that excellent progress has been made in our core science focus
where we look to acquire and develop new and innovative R&D programmes in the
epigenomic and diagnostic fields. In April, Cronos Therapeutics Limited
("Cronos") signed an agreement with the University of Surrey's Postgraduate
Medical School to co-develop prostate and bladder cancer diagnostics based on
Cronos' proprietary HyperGenomics technology. At the same time, Cronos and
ATDBio Ltd completed their initial experiments involving GeneICE (the
gene-silencing technology) with confirmation that the GeneICE drug binds to its
predicted genetic target under model physiological conditions. Post the period
end, the efficacy of the GeneICE compound to arrest the development and
terminate the existence of cancer cells received further support through the
positive findings from Cancer Research Technology ("CRT"), as announced to the
market earlier this month.
During the period, we have also progressed in the protection of our portfolio
of intellectual property ("IP") in the world's major life science markets. In
April, we received patent approval from the United States Patent and Trademark
Office covering all 50 US states for GeneICE; then in August, we received
patent approval by the European Patent Office covering 23 European states.
To further support the commercialisation of our portfolio of gene regulation
and epigenetic diagnostic technologies, the Company has signed two strategic
alliances with US companies. The first agreement with Bridgetech, a company
focused on healthcare products and services in the US & Asia, governs
cooperative efforts in creating and exploiting market technology transfer
initiatives between Europe and China. The second is with Clarity Imaging
International, a company that offers emerging technologies to the medical
community and where both parties will cooperate and agree terms to exploit
technology transfer initiatives between the US and Europe in the future.
Through these agreements, we aim to bring our therapeutic and diagnostic
technologies to the Asian and US markets.
Disease Focus (Oncology)
In February 2007, the Company announced it had put in place an agreement with
Physiomics Plc, the European systems biology simulation company, to use its In
Silico simulation of cellular processes to reduce the development time and
costs associated in identifying new therapeutic compounds for the treatment of
cancers. The primary concentration of the initial program is to investigate the
process of Apoptosis (the natural process of programmed cell death and
turnover), a process that is frequently disrupted in cancers.
Diagnostics Product & Development
The main development to report happened post the period end. In July, the
Company announced the signing of a Memorandum of Understanding with BIO.be, a
Belgian company of the Institute of Pathology and Genetics ("IPG"), to
establish a joint-venture focused on the development and commercialisation of
products in the epigenomics sector.
The newly created oncology diagnostics company, ValiBIO S.A. ("ValiBIO"), will
be based in Gossellies, Belgium and ValiRx will invest cash and equity in
return for 77% of the equity in ValiBIO. With the additional funds that we
expect to be made available from government grants and loans, we aim to build a
team and laboratory facilities to utilise the scientific and material resources
at IPG and patient materials from European cancer biobanks, to develop
HyperGenomics-based cancer diagnostic products.
Meanwhile Morphogenesis, where ValiRx holds an 8.517% stake, continues to
progress the development of its core products: the ImmuneFx cancer vaccine, the
Stem Cell Proliferation Factor, and the Polymer Cell Separation System.
With regards to its most developed product, ImmuneFx, I can confirm preclinical
trials have been completed and investigations are now ongoing to find the best
venue for a Phase I human trial.
Financial Overview
During the period under the review, the administrative charges have been in
line with budget, their increase primarily relating to the creation of ValiBIO.
The Company has also recently announced the completion of a placing to raise an
additional £300,000 for working capital purposes.
Strategic Summary
In summary, I am pleased with the progress the Company has made in the period.
This has been underpinned by the excellent results received post the period end
from CRT on GeneICE. This progress on our science front, when combined with the
strengthening of our IP and the widening of our strategic agreements and
collaborations, has, in the opinion of the board, created a sound foundation on
which we can continue to build.
Tony Moore
Chairman
28th September 2007
Valirx Plc
Income statement
for the six months ended 30 June
2007
Six months Three Nine
ended months months
ended
Notes 30-Jun 30-Jun 31-Dec
2007 2006 2006
(unaudited) (unaudited) (audited)
£ £ £
Revenue 5,741 - 9,577
Administrative expenses -426,385 -23,197 -273,292
Operating loss -420,644 -23,197 -263,715
Loss on deemed disposal of - - -60,133
shares in subsidiary
Loss before interest -420,644 -23,197 -323,848
Other interest receivable and 9,583 - 7,828
similar income
Interest payable and similar -12 - -49
charges
Loss before taxation -411,073 -23,197 -316,069
Taxation 3 - - -
Loss after taxation -411,073 -23,197 -316,069
Minority interest 60,704 - 29,112
Loss for the period -350,369 -23,197 -286,957
Loss per share - basic and 4 (0.04)p (0.05)p (0.11)p
diluted
Statement of changes in
shareholders' equity
for the six months ended 30 June
2007
Six months Three Nine
ended months months
ended
30-Jun 30-Jun 31-Dec
2007 2006 2006
(unaudited) (unaudited) (audited)
£ £ £
Opening shareholders' equity 2,655,305 161,197 161,197
Issue of shares 2,800 - 4,381,054
Other movements -28,584 - -1,599,989
Loss for the period -350,369 -23,197 -286,957
Closing shareholders' equity 2,279,152 138,000 2,655,305
Balance sheet
as at 30 June 2007
As at 30 June 31-Dec
2007 2006 2006
(unaudited) (unaudited) (audited)
£ £ £
ASSETS
Non current assets
Intangible assets 576,187 63,650 488,027
Property, plant and 4,233 1,100 4,833
equipment
Investments 1,333,770 - 1,333,770
1,914,190 64,750 1,826,630
Current assets
Trade and other 79,108 75,257 154,479
receivables
Cash and cash equivalents 413,433 13,051 810,639
492,541 88,308 965,118
LIABILITIES
Current liabilities
Trade and other payables -157,262 -15,058 -105,422
Net current assets 335,279 73,250 859,696
Total assets less current 2,249,469 138,000 2,686,326
liabilities
SHAREHOLDERS' EQUITY
Called up share capital 11,155,855 5,474,902 11,153,055
Share premium 6,951,186 10,279,042 6,979,770
Merger reserve 637,500 - 637,500
Reverse acquisition -15,760,591 -15,525,275 -15,760,591
Retained earnings -704,798 -90,669 -354,429
Total shareholders' 2,279,152 138,000 2,655,305
equity
Minority interest -29,683 - 31,021
2,249,469 138,000 2,686,326
Cash flow statement
for the six months ended 30 June 2007
Six months Three Nine
ended months months
ended
30-Jun 30-Jun 31-Dec
2007 2006 2006
(unaudited) (unaudited) (audited)
£ £ £
Operating activities
Operating loss -420,644 -23,197 -263,715
Depreciation of tangible assets 600 18 1,310
Amortisation of intangible assets 2,400 1,025 3,211
Decrease/(increase) in debtors 75,371 -37 -176,191
Increase in creditors within one year 51,840 6,286 381,840
Cash outflows from operating -290,433 -15,905 -53,545
activities
Investing activities
Interest received 9,583 - 7,828
Interest paid -12 - -49
Payments to acquire intangible assets -90,560 -4,879 -7,868
Payments to acquire tangible assets - - -5,025
Payments to acquire investments - - -190,770
Purchase of subsidiary undertaking, - - 1,290,767
net of cash acquired
Net cash generated from (used in) -80,989 -4,879 1,094,883
investing activities
Financing activities
Issue of ordinary share capital 2,800 - 127,500
Cost of share issue -28,584 - -392,034
Net cash used in financing activities -25,784 - -264,534
Net (decrease)/increase in cash and -397,206 -20,784 776,804
cash equivalents
Cash and cash equivalents at start of 810,639 33,835 33,835
period
Cash and cash equivalents at end of 413,433 13,051 810,639
period
Notes to the interim accounts
1. Basis of preparation
The condensed consolidated interim financial statements for the six months
ended 30 June 2007 have been prepared under applicable International Financial
Reporting Standards adopted by the European Union ("IFRS").
The interim financial information for the six months ended 30 June 2007 have
been prepared on the basis of the accounting policies set out on pages 13 to 17
of the 2006 Annual Report and Accounts.
The financial information included in this document is unaudited and does not
comprise statutory accounts within the meaning of Section 240 of the Companies
Act 1985. The comparative figures for the period ended 31 December 2006, are
extracted from the statutory financial statements for that period which have
been filed with the Registrars of Companies and on which the auditor gave an
unqualified report, without any statement under Section 237(2) or (3) of the
Companies Act 1985.
2. Comparative figures for the three months ended 30 June 2006
On 3 October 2006, Valirx Bioinnovations Limited ('Bioinnovations') acquired
60.28% of the issued share capital of Cronos Therapeutics Limited ('Cronos') in
exchange for shares in Bioinnovations. Concurrently, the Company, then called
Azure Holdings plc ('Azure'), acquired the entire issued share capital of
Bioinnovations in a share for share transaction. As a result of these
transactions, the former shareholders of Cronos became the majority
shareholders in Azure. Accordingly the substance of the transaction was that
Cronos acquired Azure in a reverse acquisition. As part of the business
combination, Azure changed its name to Valirx Plc ('Valirx').
Under IFRS 3 'Business Combinations', the acquisition of Cronos has been
accounted for as a reverse acquisition. As a
consequence of applying reverse acquisition accounting, the results for the
period ended 31 December 2006 comprise
those of Cronos plus those of Valirx and Bioinnovations from 3 October 2006.
The comparative figures for the period
ended 30 June 2006 are those of Cronos only for that period. The consolidated
balance sheet comprises the combined
balances of Cronos, Valirx and Bioinnovations at 31 December 2006. The
comparative balance sheet is that of Cronos at 30 June 2006.
3. Taxation
On the basis of these financial statements there is no tax charge for the
period.
4. Earnings per ordinary share
The earnings and number of shares used in the calculation of earnings per
ordinary share are set out below.
Six months Three months Nine months
ended ended
30-Jun 30-Jun 31-Dec
2007 2006 2006
(unaudited) (unaudited) (audited)
Basic:
Loss for the financial 350,369 23,197 286,957
period
Weighted average number 885,891,389 48,317,569 264,684,539
of shares
Loss per share 0.04p 0.05p 0.11p
There was no dilutive effect from the share options outstanding during the
period.
5. Dividend
The directors do not propose to declare a dividend in respect of the period.
6. Additional information
Copies of this report may be obtained from the Company's registered office, 24
Greville Street, London EC1N 8SS. Our website address is www.valirx.com. From
this site you may access our financial reports and presentations, recent press
releases and details about the company and its operations.
---ENDS---
Information on ValiRx plc
ValiRx is a biopharmaceutical development company that is building a portfolio
of complementary cancer-related therapeutic and diagnostic technologies. It
currently holds stakes in Cronos and Morphogenesis Inc:
* Cronos holds licenses to two innovative and potentially market changing
technologies, GeneICE and HyperGenomics;
* Morphogenesis Inc. is developing a portfolio of cell therapy products for
the treatment of chronic disorders. Its most advanced product, being
ImmuneFx™ for which it recently received a patent from the US patent
office.
ValiRx is headquartered in London, England. Please visit www.valirx.com for
further information.
Contact Details:
ValiRx Plc WH Ireland GTH Communications
Dr Satu Vainikka David Youngman Toby Hall / Jade
Mamarbachi
+44 (0) 203 008 4416 +44 (0) 161 832 +44 (0) 20 7153 8035
2174
END
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