Full Press Release Details
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||||||
| Notes | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||
| Research and development expenses | (8,971 | ) | (6,117 | ) | (26,200 | ) | (17,918 | ) | ||||||||||||
| Administrative expenses | (2,277 | ) | (1,906 | ) | (6,456 | ) | (5,144 | ) | ||||||||||||
| Net foreign exchange gains (losses) | 1,274 | (1,601 | ) | 488 | 610 | |||||||||||||||
| Operating loss | (9,974 | ) | (9,624 | ) | (32,168 | ) | (22,452 | ) | ||||||||||||
| Finance income | 22 | 26 | 81 | 234 | ||||||||||||||||
| Loss before tax | (9,952 | ) | (9,598 | ) | (32,087 | ) | (22,218 | ) | ||||||||||||
| Income tax credit | 3 | 1,911 | 1,204 | 5,198 | 3,797 | |||||||||||||||
| Loss for the period | (8,041 | ) | (8,394 | ) | (26,889 | ) | (18,421 | ) | ||||||||||||
| Basic and diluted loss per share | 4 | (0.15 | ) | (0.24 | ) | (0.52 | ) | (0.55 | ) |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| (in thousands) | ||||||||||||||||
| Loss for the period | (8,041 | ) | (8,394 | ) | (26,889 | ) | (18,421 | ) | ||||||||
| Other comprehensive income (expense): | ||||||||||||||||
| Items that may be reclassified subsequently to profit or loss: | ||||||||||||||||
| Exchange differences on translation of foreign operations | 10 | (15 | ) | 6 | 7 | |||||||||||
| Other comprehensive income (expense) for the period | 10 | (15 | ) | 6 | 7 | |||||||||||
| Total comprehensive loss for the period | (8,031 | ) | (8,409 | ) | (26,883 | ) | (18,414 | ) | ||||||||
| Attributable to: | ||||||||||||||||
| Equity holders of the Company | (8,031 | ) | (8,409 | ) | (26,883 | ) | (18,414 | ) |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
| September 30, 2021 | December 31, 2020 | |||||||||||
| (in thousands) | ||||||||||||
| Notes | ||||||||||||
| Assets | ||||||||||||
| Non-current assets | ||||||||||||
| Intangible assets | 5 | 4,896 | 4,753 | |||||||||
| Property, plant and equipment | 952 | 1,189 | ||||||||||
| Deferred tax asset | 3 | 34 | 44 | |||||||||
| Other non-current assets | 6 | 2,600 | ||||||||||
| 8,482 | 5,986 | |||||||||||
| Current assets | ||||||||||||
| Prepayments, accrued income and other receivables | 5,133 | 4,628 | ||||||||||
| Current income tax receivable | 3 | 5,143 | 9,822 | |||||||||
| Cash and cash equivalents | 7 | 71,027 | 87,356 | |||||||||
| 81,303 | 101,806 | |||||||||||
| Total assets | 89,785 | 107,792 | ||||||||||
| Equity and liabilities | ||||||||||||
| Capital and reserves | ||||||||||||
| Share capital and share premium | 9 | 143,136 | 142,937 | |||||||||
| Other reserves | 70,395 | 66,887 | ||||||||||
| Accumulated deficit | (136,084 | ) | (110,594 | ) | ||||||||
| Total equity attributable to equity holders of the Company | 77,447 | 99,230 | ||||||||||
| Non-current liabilities | ||||||||||||
| Provisions | 46 | 46 | ||||||||||
| Lease liabilities | 195 | 367 | ||||||||||
| 241 | 413 | |||||||||||
| Current liabilities | ||||||||||||
| Trade payables | 3,891 | 2,257 | ||||||||||
| Payroll taxes and social security | 152 | 177 | ||||||||||
| Accrued expenditure | 7,811 | 5,437 | ||||||||||
| Lease liabilities | 243 | 278 | ||||||||||
| 12,097 | 8,149 | |||||||||||
| Total liabilities | 12,338 | 8,562 | ||||||||||
| Total equity and liabilities | 89,785 | 107,792 |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
| For the Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||
| Share capital | Share premium | Own share reserve | Share option reserve | Foreign currency translation reserve | Capital reserve | Accumulated deficit | Total equity attributable to equity holders | |||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||||||||
| Balance at January 1, 2020 | 1,299 | 79,541 | (339 | ) | 20,620 | (10 | ) | 42,466 | (80,055 | ) | 63,522 | |||||||||||||||||||||
| Loss for the period | (18,421 | ) | (18,421 | ) | ||||||||||||||||||||||||||||
| Other comprehensive income for the period | 7 | 7 | ||||||||||||||||||||||||||||||
| Total comprehensive loss for the period | 7 | (18,421 | ) | (18,414 | ) | |||||||||||||||||||||||||||
| Share-based payments | 3,069 | 3,069 | ||||||||||||||||||||||||||||||
| Exercise of share options | 1 | 14 | (68 | ) | 68 | 15 | ||||||||||||||||||||||||||
| Lapse of share options | (5 | ) | 5 | |||||||||||||||||||||||||||||
| Issue of share capital | 747 | 65,834 | 66,581 | |||||||||||||||||||||||||||||
| Share issue expenses | (4,499 | ) | (4,499 | ) | ||||||||||||||||||||||||||||
| Balance at September 30, 2020 | 2,047 | 140,890 | (339 | ) | 23,616 | (3 | ) | 42,466 | (98,403 | ) | 110,274 | |||||||||||||||||||||
| Balance at January 1, 2021 | 2,047 | 140,890 | (339 | ) | 24,782 | (22 | ) | 42,466 | (110,594 | ) | 99,230 | |||||||||||||||||||||
| Loss for the period | (26,889 | ) | (26,889 | ) | ||||||||||||||||||||||||||||
| Other comprehensive income for the period | 6 | 6 | ||||||||||||||||||||||||||||||
| Total comprehensive loss for the period | 6 | (26,889 | ) | (26,883 | ) | |||||||||||||||||||||||||||
| Share-based payments | 4,919 | 4,919 | ||||||||||||||||||||||||||||||
| Exercise of share options | 40 | 159 | (1,221 | ) | 1,203 | 181 | ||||||||||||||||||||||||||
| Lapse of share options | (196 | ) | 196 | |||||||||||||||||||||||||||||
| Balance at September 30, 2021 | 2,087 | 141,049 | (339 | ) | 28,284 | (16 | ) | 42,466 | (136,084 | ) | 77,447 |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the Nine Months Ended September 30, | ||||||||
| 2021 | 2020 | |||||||
| (in thousands) | ||||||||
| Cash flows from operating activities | ||||||||
| Loss for the period | (26,889 | ) | (18,421 | ) | ||||
| Adjustments for: | ||||||||
| Income tax credit | (5,198 | ) | (3,797 | ) | ||||
| Amortization and depreciation | 673 | 667 | ||||||
| Finance income | (81 | ) | (234 | ) | ||||
| Interest expense on lease liabilities | 15 | 20 | ||||||
| Share-based payments | 4,919 | 3,069 | ||||||
| Net foreign exchange gains | (533 | ) | (619 | ) | ||||
| (27,094 | ) | (19,315 | ) | |||||
| Movements in working capital: | ||||||||
| Increase in prepayments, accrued income and other receivables | (497 | ) | (408 | ) | ||||
| Increase in trade payables | 1,634 | 1,778 | ||||||
| Increase in payroll taxes, social security and accrued expenditure | 2,333 | 1,153 | ||||||
| Movements in working capital | 3,470 | 2,523 | ||||||
| Cash used in operations | (23,624 | ) | (16,792 | ) | ||||
| Net income tax received | 9,888 | 4,152 | ||||||
| Net cash used in operating activities | (13,736 | ) | (12,640 | ) | ||||
| Cash flows from investing activities | ||||||||
| Interest received | 79 | 300 | ||||||
| Payments for property, plant and equipment | (43 | ) | (350 | ) | ||||
| Payments for intangible assets | (537 | ) | (1,079 | ) | ||||
| Payments for other non-current assets | (2,597 | ) | ||||||
| Net cash used in investing activities | (3,098 | ) | (1,129 | ) | ||||
| Cash flows from financing activities | ||||||||
| Payments of lease liabilities | (222 | ) | (223 | ) | ||||
| Proceeds from issue of share capital exercise of share options | 198 | 15 | ||||||
| Proceeds from issue of share capital | 66,581 | |||||||
| Share issue expenses | (4,499 | ) | ||||||
| Net cash (used in) from financing activities | (24 | ) | 61,874 | |||||
| Net (decrease) increase in cash and cash equivalents | (16,858 | ) | 48,105 | |||||
| Cash and cash equivalents at beginning of period | 87,356 | 51,962 | ||||||
| Effect of exchange rate changes on cash and cash equivalents | 529 | 611 | ||||||
| Cash and cash equivalents at end of period | 71,027 | 100,678 |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. General information
( NuCana or the Company ) is a clinical-stage biopharmaceutical company developing a portfolio of new medicines to treat cancer. NuCana is harnessing the power of phosphoramidate chemistry to generate new medicines called
ProTides. These compounds have the potential to improve cancer treatment by enhancing the efficacy and safety of several current standards of care.
The Company has ordinary shares in the form of American Depositary Shares ( ADSs ) registered with the US Securities and Exchange
Commission (the SEC ) and has been listed on The Nasdaq Global Select Market ( Nasdaq ) since October 2, 2017. The Company is incorporated in England and Wales and domiciled in the United Kingdom. The Company s
registered office is located at 77/78 Cannon Street, London EC4N 6AF, United Kingdom and its principal place of business is located at 3 Lochside Way, Edinburgh, EH12 9DT, United Kingdom.
The Company has three wholly owned subsidiaries, NuCana, Inc., NuCana Limited and NuCana BioMed Trustee Company Limited (together referred to
The financial information presented in these unaudited condensed consolidated financial statements does not
constitute the Group s statutory accounts within the meaning of section 434 of the U.K. Companies Act 2006.
statutory accounts for the year ended December 31, 2020 have been reported on by the Company s auditor and delivered to the Registrar of Companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any
matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
2. Significant accounting policies
Basis of preparation
The unaudited condensed consolidated financial statements (the financial statements ) for the three months and nine months ended
September 30, 2021 have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting ( IAS 34 ). The significant accounting policies and methods of computation applied in
the preparation of the financial statements are consistent with those applied in the Company s annual financial statements for the year ended December 31, 2020. No new standards, amendments or interpretations have had an impact on the
financial statements for the three months and nine months ended September 30, 2021. The financial statements comprise the financial statements of the Group at September 30, 2021. The financial statements are presented in pounds sterling,
which is also the Company s functional currency. All values are rounded to the nearest thousand, except where otherwise indicated.
The financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in
conjunction with the Company s annual financial statements for the year ended December 31, 2020.
In the opinion of management,
these unaudited condensed consolidated financial statements include all normal recurring adjustments necessary for a fair statement of the results of operations, financial position and cash flows. The results of operations for the three months and
nine months ended September 30, 2021 are not necessarily indicative of the results that can be expected for the Company s fiscal year ending December 31, 2021.
common with many companies in the biopharmaceutical sector, the Company incurs significant expenditure in its early years as it researches and develops its potential products for market.
The Company s board of directors, having reviewed the operating budgets and development plans, considers that the Company has adequate
resources to continue in operation for the foreseeable future. The board of directors is therefore satisfied that it is appropriate to adopt the going concern basis of accounting in preparing the financial statements. The Company believes that its
cash and cash equivalents of 71.0 million at September 30, 2021 will be sufficient to fund its current operating plan for at least the next 12 months. Further, the directors have conducted an assessment of the impact of COVID-19 on the going concern status of the Company and have concluded that it will not have a significant negative impact on the cash outflows of the Company over the period assessed for going concern purposes.
As the Company continues to incur losses, the transition to profitability is dependent upon the successful development, approval and
commercialization of its product candidates and achieving a level of revenues adequate to support its cost structure. The Company may never achieve profitability, and unless and until it does, it will continue to need to raise additional capital.
There can be no assurances, however, that additional funding will be available on acceptable terms.
In response to the spread of COVID-19, all of the Company s offices have been closed with
employees continuing their work outside of the offices and the Company has restricted on-site staff access to only those required to execute their job responsibilities.
During the early months of the pandemic the Company announced that there was some temporary interruption to the enrollment of new patients in
the Company s ongoing clinical trials. In May 2020, the Company further announced that enrollment of new patients in the Company s clinical trials had re-commenced. While the Company continues to
evaluate the impact of COVID-19 on its operations, the Company believes that this pandemic will inevitably cause some delays to the timing of initiation and completion of its clinical trials. The Company is
continuing to monitor the impact of COVID-19.
had no impact on the judgements and estimates used in the preparation of these financial statements.
The accounting estimates and judgements made by management in applying the Group s accounting policies that have
the most significant effect on the amounts included within these financial statements, were the same as those that applied to the annual financial statements for the year ended December 31, 2020.
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| (in thousands) | (in thousands) | |||||||||||||||
| Current tax: | ||||||||||||||||
| In respect of current period U.K. | 1,845 | 1,230 | 5,139 | 3,834 | ||||||||||||
| In respect of current period U.S. | (1 | ) | ||||||||||||||
| In respect of prior period U.K. | 70 | (22 | ) | 70 | (22 | ) | ||||||||||
| 1,915 | 1,208 | 5,209 | 3,811 | |||||||||||||
| Deferred tax: | ||||||||||||||||
| In respect of current period U.S. | (4 | ) | (4 | ) | (11 | ) | (13 | ) | ||||||||
| In respect of prior period U.S. | (1 | ) | ||||||||||||||
| Income tax credit | 1,911 | 1,204 | 5,198 | 3,797 |
The income tax credit recognized primarily represents the U.K. research and development tax credit. In the
United Kingdom, the Company is able to surrender some of its losses for a cash rebate of up to 33.35% of expenditure related to eligible research and development projects.
| September 30, 2021 | December 31, 2020 | |||||||
| (in thousands) | ||||||||
| Current income tax receivable | ||||||||
| U.K. tax | 5,140 | 9,818 | ||||||
| U.S. tax | 3 | 4 | ||||||
| 5,143 | 9,822 | |||||||
| Deferred tax asset | ||||||||
| U.S. deferred tax asset | 34 | 44 |
4. Basic and diluted loss per share
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| (in thousands, except per share data) | ||||||||||||||||
| Loss for the period | (8,041 | ) | (8,394 | ) | (26,889 | ) | (18,421 | ) | ||||||||
| Basic and diluted weighted average number of shares | 52,165 | 35,093 | 51,994 | 33,419 | ||||||||||||
| Basic and diluted loss per share | (0.15 | ) | (0.24 | ) | (0.52 | ) | (0.55 | ) |
Basic loss per share is calculated by dividing the loss for the period attributable to the equity holders of
the Company by the weighted average number of shares outstanding during the period.
The potential shares issued through equity settled
transactions were considered to be anti-dilutive as they would have decreased the loss per share and were therefore excluded from the calculation of diluted loss per share.
5. Intangible assets
comprise patents with a carrying value of 4.8 million as of September 30, 2021 (as of December 31, 2020: 4.6 million) and computer software with a carrying value of 0.1 million as of September 30, 2021
(as of December 31, 2020: 0.2 million).
During the nine months ended September 30, 2021, the Company acquired intangible
assets with a cost of 0.5 million in relation to patents. There were no disposals of intangible assets in the nine months ended September 30, 2021.
6. Other non-current assets
| September 30, 2021 | December 31, 2020 | |||||||
| (in thousands) | ||||||||
| Other non-current assets | 2,600 |
In April 2021, the Company initiated legal proceedings against Gilead Sciences Ireland UC and Gilead Sciences
GmbH for patent infringement in Germany. In June 2021, the Company was requested by the court to provide the defendants with a security of 3.0 million ( 2.6 million) to cover the legal costs of the defendants in the event that the
Company is unsuccessful in the final outcome of the legal proceedings. In July 2021, the Company provided the security in accordance with the court order by depositing 3.0 million with the court.
The extent to which the sum deposited will be reimbursed to the Company is dependent on a range of potential outcomes, and the timing of those
outcomes, with respect to the patent infringement litigation in Germany, which is currently indeterminable.
7. Cash and cash equivalents
| September 30, 2021 | December 31, 2020 | |||||||
| (in thousands) | ||||||||
| Cash and cash equivalents | 71,027 | 87,356 |
Cash and cash equivalents comprise cash at banks with maturity terms of three months or less, and is subject
to insignificant risk of changes in value. Cash at banks earns interest at fixed or variable rates based on the terms agreed for each account.
Share-based payments
The Company has six share-based payment plans for employees, directors and consultants. The share options granted
will be settled in equity. Options granted under each of the six plans have a maximum life of 10 years. If the Company determines, and at its discretion, an arrangement may be made under the 2020 Long-Term Incentive Plan to substitute the right to
acquire shares with a cash alternative of equivalent value.
As detailed in the table below, during the nine months ended September 30, 2021,
4,164,913 share options were granted under the 2020 Long-Term Incentive Plan (nine months ended September 30, 2020: 2,585,639 share options granted under the 2016 Share Option Scheme and 2020 Long-Term Incentive Plan). Options granted under
these plans will vest if the option holder remains under respective contract of employment or contract of service for the agreed vesting period. The share options granted in the period will vest over a period of up to four years.
The fair values of options granted were determined using the Black-Scholes model that takes into account factors specific to the share
incentive plan such as the assumption that the options are exercised at a point in time of up to two years after vesting. This has been incorporated into the measurement by means of actuarial modelling. As NuCana plc was unlisted until
October 2, 2017, it is not possible to derive historical volatility from the Company s ADSs prior to October 2017. For options with an estimated life of greater than three years, the underlying expected volatility was determined by using
the average of the historical volatility of similar listed entities as a proxy. Options granted with an estimated life of three years or less, have been valued using the Company s own historical volatility rates.
| Options granted on | ||||||||||||||||
| January 13, 2021 | February 10, 2021 | February 10, 2021 | February 10, 2021 | |||||||||||||
| Vesting dates | January 13, 2022 | February 10, 2022 | February 10, 2022 | February 10, 2022 | ||||||||||||
| January 13, 2023 | February 10, 2023 | February 10, 2023 | February 10, 2023 | |||||||||||||
| January 13, 2024 | February 10, 2024 | February 10, 2024 | February 10, 2024 | |||||||||||||
| January 13, 2025 | February 10, 2025 | February 10, 2025 | February 10, 2025 | |||||||||||||
| Volatility | 81.42 | % | 81.45 | % | 87.66 | % | 83.86 | % | ||||||||
| Dividend yield | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||
| Risk-free investment rate | 0.01 | % | 0.11 | % | 0.01 | % | 0.05 | % | ||||||||
| Fair value of option at grant date | 2.37 | 2.74 | 4.49 | 4.49 | ||||||||||||
| Fair value of share at grant date | 3.92 | 4.53 | 4.53 | 4.53 | ||||||||||||
| Exercise price at date of grant | 3.92 | 4.53 | 0.04 | 0.04 | ||||||||||||
| Lapse date | January 13, 2031 | February 10, 2031 | February 10, 2031 | |||||||||||||
| Expected option life (years) | 4.5 | 4.5 | 2.5 | 3.5 | ||||||||||||
| Number of options granted | 200,000 | 872,775 | 91,888 | 337,000 |
| August 11, 2021 | September 15, 2021 | September 15, 2021 | September 15, 2021 | |||||||||||||
| Vesting dates | August 11, 2022 | Sept. 15, 2022 | Sept. 15, 2022 | Sept. 15, 2022 | ||||||||||||
| August 11, 2023 | Sept. 15, 2023 | Sept. 15, 2023 | Sept. 15, 2023 | |||||||||||||
| August 11, 2024 | Sept. 15, 2024 | Sept. 15, 2024 | Sept. 15, 2024 | |||||||||||||
| August 11, 2025 | Sept. 15, 2025 | Sept. 15, 2025 | Sept. 15, 2025 | |||||||||||||
| Volatility | 81.07 | % | 79.60 | % | 82.06 | % | 80.90 | % | ||||||||
| Dividend yield | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||
| Risk-free investment rate | 0.28 | % | 0.21 | % | 0.29 | % | 0.36 | % | ||||||||
| Fair value of option at grant date | 0.95 | 1.67 | 1.67 | 1.04 | ||||||||||||
| Fair value of share at grant date | 1.57 | 1.71 | 1.71 | 1.71 | ||||||||||||
| Exercise price at date of grant | 1.57 | 0.04 | 0.04 | 1.71 | ||||||||||||
| Lapse date | August 11, 2031 | Sept. 15, 2031 | Sept. 15, 2031 | |||||||||||||
| Expected option life (years) | 4.5 | 2.5 | 3.5 | 4.5 | ||||||||||||
| Number of options granted | 430,000 | 140,650 | 603,900 | 1,488,700 |
For the three months ended September 30, 2021, the Company has recognized 1.3 million of
share-based payment expense in the statement of operations (three months ended September 30, 2020: 1.4 million). For the nine months ended September 30, 2021, the Company has recognized 4.9 million of share-based payment
expense in the statement of operations (nine months ended September 30, 2020: 3.1 million).
9. Share capital and share premium
| September 30, 2021 | December 31, 2020 | |||||||
| (in thousands) | ||||||||
| Share capital | 2,087 | 2,047 | ||||||
| Share premium | 141,049 | 140,890 | ||||||
| 143,136 | 142,937 | |||||||
| September 30, 2021 | December 31, 2020 | |||||||
| Number (in thousands) | ||||||||
| Issued share capital comprises: | ||||||||
| Ordinary shares of 0.04 each | 52,180 | 51,175 |
| Number of shares | Share capital | Share premium | ||||||||||
| (in thousands) | ||||||||||||
| Fully paid shares: | ||||||||||||
| Balance at December 31, 2020 | 51,175 | 2,047 | 140,890 | |||||||||
| Issue of shares on exercise of options | 1,005 | 40 | 159 | |||||||||
| Balance at September 30, 2021 | 52,180 | 2,087 | 141,049 |