Full Press Release Details
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||||||
| Notes | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||
| Research and development expenses | (7,439 | ) | (7,386 | ) | (18,203 | ) | (23,238 | ) | ||||||||||||
| Administrative expenses | (1,375 | ) | (1,715 | ) | (4,777 | ) | (5,756 | ) | ||||||||||||
| Net foreign exchange gains (losses) | 562 | 2,912 | (697 | ) | 7,120 | |||||||||||||||
| Operating loss | (8,252 | ) | (6,189 | ) | (23,677 | ) | (21,874 | ) | ||||||||||||
| Finance income | 152 | 216 | 617 | 380 | ||||||||||||||||
| Loss before tax | (8,100 | ) | (5,973 | ) | (23,060 | ) | (21,494 | ) | ||||||||||||
| Income tax credit | 3 | 1,404 | 1,445 | 3,083 | 4,672 | |||||||||||||||
| Loss for the period attributable to equity holders of the Company | (6,696 | ) | (4,528 | ) | (19,977 | ) | (16,822 | ) | ||||||||||||
| Basic and diluted loss per share | 4 | (0.13 | ) | (0.09 | ) | (0.38 | ) | (0.32 | ) |
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, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| (in thousands) | ||||||||||||||||
| Loss for the period | (6,696 | ) | (4,528 | ) | (19,977 | ) | (16,822 | ) | ||||||||
| Other comprehensive income (expense): | ||||||||||||||||
| Items that may be reclassified subsequently to profit or loss: | ||||||||||||||||
| Exchange differences on translation of foreign operations | 30 | 52 | (8 | ) | 108 | |||||||||||
| Other comprehensive income (expense) for the period | 30 | 52 | (8 | ) | 108 | |||||||||||
| Total comprehensive loss for the period | (6,666 | ) | (4,476 | ) | (19,985 | ) | (16,714 | ) | ||||||||
| Attributable to: | ||||||||||||||||
| Equity holders of the Company | (6,666 | ) | (4,476 | ) | (19,985 | ) | (16,714 | ) |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
| September 30, 2023 | December 31, 2022 | |||||||||||
| (in thousands) | ||||||||||||
| Notes | ||||||||||||
| Assets | ||||||||||||
| Non-current assets | ||||||||||||
| Intangible assets | 5 | 2,583 | 2,365 | |||||||||
| Property, plant and equipment | 612 | 866 | ||||||||||
| Deferred tax asset | 3 | 127 | 103 | |||||||||
| 3,322 | 3,334 | |||||||||||
| Current assets | ||||||||||||
| Prepayments, accrued income and other receivables | 3,414 | 3,957 | ||||||||||
| Current income tax receivable | 3 | 9,428 | 6,367 | |||||||||
| Other assets | 6 | 2,684 | ||||||||||
| Cash and cash equivalents | 7 | 17,803 | 41,912 | |||||||||
| 30,645 | 54,920 | |||||||||||
| Total assets | 33,967 | 58,254 | ||||||||||
| Equity and liabilities | ||||||||||||
| Capital and reserves | ||||||||||||
| Share capital and share premium | 9 | 143,400 | 143,203 | |||||||||
| Other reserves | 78,430 | 75,872 | ||||||||||
| Accumulated deficit | (200,056 | ) | (180,573 | ) | ||||||||
| Total equity attributable to equity holders of the Company | 21,774 | 38,502 | ||||||||||
| Non-current liabilities | ||||||||||||
| Provisions | 10 | 58 | 46 | |||||||||
| Lease liabilities | 222 | 396 | ||||||||||
| 280 | 442 | |||||||||||
| Current liabilities | ||||||||||||
| Trade payables | 5,174 | 4,803 | ||||||||||
| Payroll taxes and social security | 165 | 162 | ||||||||||
| Accrued expenditure | 6,344 | 10,002 | ||||||||||
| Lease liabilities | 230 | 243 | ||||||||||
| Provisions | 10 | 4,100 | ||||||||||
| 11,913 | 19,310 | |||||||||||
| Total liabilities | 12,193 | 19,752 | ||||||||||
| Total equity and liabilities | 33,967 | 58,254 |
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, 2022 | 2,087 | 141,050 | (339 | ) | 30,027 | (17 | ) | 42,466 | (149,726 | ) | 65,548 | |||||||||||||||||||||
| Loss for the period | (16,822 | ) | (16,822 | ) | ||||||||||||||||||||||||||||
| Other comprehensive income for the period | 108 | 108 | ||||||||||||||||||||||||||||||
| Total comprehensive loss for the period | 108 | (16,822 | ) | (16,714 | ) | |||||||||||||||||||||||||||
| Share-based payments | 3,900 | 3,900 | ||||||||||||||||||||||||||||||
| Exercise of share options | 1 | (362 | ) | 320 | (41 | ) | ||||||||||||||||||||||||||
| Lapse of share options | (715 | ) | 715 | |||||||||||||||||||||||||||||
| Balance at September 30, 2022 | 2,088 | 141,050 | (339 | ) | 32,850 | 91 | 42,466 | (165,513 | ) | 52,693 | ||||||||||||||||||||||
| Balance at January 1, 2023 | 2,095 | 141,108 | (339 | ) | 33,701 | 44 | 42,466 | (180,573 | ) | 38,502 | ||||||||||||||||||||||
| Loss for the period | (19,977 | ) | (19,977 | ) | ||||||||||||||||||||||||||||
| Other comprehensive expense for the period | (8 | ) | (8 | ) | ||||||||||||||||||||||||||||
| Total comprehensive loss for the period | (8 | ) | (19,977 | ) | (19,985 | ) | ||||||||||||||||||||||||||
| Share-based payments | 3,073 | 3,073 | ||||||||||||||||||||||||||||||
| Exercise of share options | 2 | 1 | (269 | ) | 256 | (10 | ) | |||||||||||||||||||||||||
| Lapse of share options | (238 | ) | 238 | |||||||||||||||||||||||||||||
| Issue of share capital | 14 | 210 | 224 | |||||||||||||||||||||||||||||
| Share issue expenses | (30 | ) | (30 | ) | ||||||||||||||||||||||||||||
| Balance at September 30, 2023 | 2,111 | 141,289 | (339 | ) | 36,267 | 36 | 42,466 | (200,056 | ) | 21,774 |
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, | ||||||||
| 2023 | 2022 | |||||||
| (in thousands) | ||||||||
| Cash flows from operating activities | ||||||||
| Loss for the period | (19,977 | ) | (16,822 | ) | ||||
| Adjustments for: | ||||||||
| Income tax credit | (3,083 | ) | (4,672 | ) | ||||
| Amortization, depreciation and loss on disposal | 434 | 676 | ||||||
| Movement in provisions | (4,109 | ) | ||||||
| Finance income | (617 | ) | (380 | ) | ||||
| Interest expense on lease liabilities | 23 | 11 | ||||||
| Share-based payments | 3,073 | 3,900 | ||||||
| Net foreign exchange losses (gains) | 661 | (7,233 | ) | |||||
| (23,595 | ) | (24,520 | ) | |||||
| Movements in working capital: | ||||||||
| Decrease (increase) in prepayments, accrued income and other receivables | 531 | (2,758 | ) | |||||
| Increase in trade payables | 371 | 3,785 | ||||||
| Decrease in payroll taxes, social security and accrued expenditure | (3,667 | ) | (101 | ) | ||||
| Movements in working capital | (2,765 | ) | 926 | |||||
| Cash used in operations | (26,360 | ) | (23,594 | ) | ||||
| Net income tax (paid) received | (2 | ) | 7,220 | |||||
| Net cash used in operating activities | (26,362 | ) | (16,374 | ) | ||||
| Cash flows from investing activities | ||||||||
| Interest received | 620 | 368 | ||||||
| Payments for property, plant and equipment | (4 | ) | (12 | ) | ||||
| Payments for intangible assets | (377 | ) | (396 | ) | ||||
| Repayment of other current assets | 2,596 | |||||||
| Net cash from (used in) investing activities | 2,835 | (40 | ) | |||||
| Cash flows from financing activities | ||||||||
| Payments for lease liabilities | (207 | ) | (189 | ) | ||||
| Proceeds from issue of share capital exercise of share options | 3 | 1 | ||||||
| Proceeds from issue of share capital | 224 | |||||||
| Share issue expense | (30 | ) | ||||||
| Net cash used in financing activities | (10 | ) | (188 | ) | ||||
| Net decrease in cash and cash equivalents | (23,537 | ) | (16,602 | ) | ||||
| Cash and cash equivalents at beginning of period | 41,912 | 60,264 | ||||||
| Effect of exchange rate changes on cash and cash equivalents | (572 | ) | 7,090 | |||||
| Cash and cash equivalents at end of period | 17,803 | 50,752 |
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 patients with 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 had American Depository Shares ( ADSs ) registered with the US Securities and Exchange Commission ( SEC )
and has been listed on The Nasdaq Global Select Market ( Nasdaq ) since October 2, 2017. From November 9, 2023 the Company transferred its listing to The Nasdaq Capital Market. 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, 2022 have been reported on by the Company s auditor, and delivered to the Registrar of Companies. The report of the auditor was (i) unqualified and (ii) did not include a
reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report.
2. Material accounting policies
Basis of preparation
The unaudited condensed consolidated financial statements (the financial statements ) for the three months and nine months ended
September 30, 2023 have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting ( IAS 34 ). The material 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, 2022. No new standards, amendments or interpretations have had an impact on the
financial statements for the three months and nine months ended September 30, 2023. The financial statements comprise the financial statements of the Group at September 30, 2023. 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, 2022.
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, 2023 are not necessarily indicative of the results that can be expected for the Company s fiscal year ending December 31, 2023.
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.
Therefore, the Company has incurred recurring losses, has an accumulated deficit totaling 200.1 million and negative cash flows
used in operating activities of 26.4 million as of and for the nine months ended September 30, 2023. The Company also had 17.8 million of cash on hand and cash equivalents at September 30, 2023.
In reviewing the going concern assessment the Company s board of directors have considered the period to December 31, 2024. The
Company plans to fund its cash flow needs through current cash on hand together with the receipt of research and development tax credits relating to the year ended December 31, 2023 from HMRC, the timing of which is outside of management s
control. In assessing the requirements necessary to continue progressing the Company s research and development activities as currently contemplated and considering the material uncertainty regarding the timing of future cash inflows from
research and development tax credits relating to the year ended December 31, 2023, there will be a requirement to seek additional capital within the going concern period to fund operations, which the Company may obtain from additional equity
financings, debt financings, research funding, collaborations, contract and grant revenue or other sources. If the Company is unable to obtain additional capital, the Company may be required to delay or reduce its research and development programs,
which could adversely affect its future business prospects and its ability to continue as a going concern.
As a result of these matters, there is material uncertainty related to the ability of the
Company to raise sufficient additional capital within the going concern period prior to its current liquidity being exhausted, which liquidity includes the cash inflows relating to research and development tax credits for the year ended December 31,
2023, which is outside of management s control. These events or conditions may cast significant doubt (or raise substantial doubt as contemplated by Public Company Accounting Oversight Board ( PCAOB ) standards) on the Company s
ability to continue as a going concern and, therefore, that the Company may be unable to realize its assets and discharge its liabilities in the normal course of business. The consolidated interim financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
Judgements and estimates
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, 2022.
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| (in thousands) | ||||||||||||||||
| Current tax: | ||||||||||||||||
| In respect of current period U.K. | 1,396 | 1,404 | 3,266 | 4,619 | ||||||||||||
| In respect of prior period U.K. | 35 | (206 | ) | 35 | ||||||||||||
| In respect of current period U.S. | (1 | ) | (1 | ) | ||||||||||||
| 1,396 | 1,439 | 3,059 | 4,653 | |||||||||||||
| Deferred tax: | ||||||||||||||||
| In respect of current period U.S. | 8 | 6 | 25 | 19 | ||||||||||||
| In respect of prior period U.S. | (1 | ) | ||||||||||||||
| Income tax credit | 1,404 | 1,445 | 3,083 | 4,672 |
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 26.97% of expenditure related to eligible research and development projects incurred on or after April 1, 2023 (33.35% prior to April 1, 2023).
| September 30, 2023 | December 31, 2022 | |||||||
| (in thousands) | ||||||||
| Current income tax receivable | ||||||||
| U.K. tax | 9,426 | 6,366 | ||||||
| U.S. tax | 2 | 1 | ||||||
| 9,428 | 6,367 | |||||||
| Deferred tax asset | ||||||||
| U.S. deferred tax asset | 127 | 103 |
4. Basic and diluted loss per share
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| (in thousands, except per share data) | ||||||||||||||||
| Loss for the period | (6,696 | ) | (4,528 | ) | (19,977 | ) | (16,822 | ) | ||||||||
| Basic and diluted weighted average number of shares | 52,670 | 52,196 | 52,480 | 52,192 | ||||||||||||
| Basic and diluted loss per share | (0.13 | ) | (0.09 | ) | (0.38 | ) | (0.32 | ) |
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 2.6 million as of September 30, 2023 (as of December 31, 2022: 2.4 million).
During the nine months ended September 30, 2023, the Company acquired intangible assets with a cost of 0.4 million in relation
| September 30, 2023 | December 31, 2022 | |||||||
| (in thousands) | ||||||||
| Other assets | 2,684 |
In April 2021, the Company initiated legal proceedings against Gilead Sciences Ireland UC and Gilead Sciences
GmbH in the German Regional Court of Dusseldorf ( RC Dusseldorf ) for patent infringement for the sale of Sovaldi as well as its combination products Harvoni, Vosevi and Epclusa in Germany. Later in 2021, the Company provided a security of
3.0 million by depositing funds with RC Dusseldorf to cover the legal costs of Gilead Sciences Ireland UC and Gilead Sciences GmbH in the event that the Company was unsuccessful in the final outcome of the patent infringement litigation
In May 2023, the Company abandoned all proceedings in Germany and reached a settlement agreement with Gilead Sciences Ireland
UC and Gilead Sciences GmbH, and as a result, the security deposit was repaid in full in July 2023.
7. Cash and cash equivalents
| September 30, 2023 | December 31, 2022 | |||||||
| (in thousands) | ||||||||
| Cash and cash equivalents | 17,803 | 41,912 |
Cash and cash equivalents comprise cash at banks with deposit maturity terms of three months or less. Cash at
banks earns interest at fixed or variable rates based on the terms agreed for each account.
8. 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. 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. Options granted under each of the six plans have
a maximum life of 10 years.
As detailed in the table below, during the nine months ended September 30, 2023, 2,733,139 share options
were granted under the 2020 Long-Term Incentive Plan (nine months ended September 30, 2022: 1,497,013 share options granted). Options granted under this plan 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 five 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 five years or less, have been valued using the Company s own historical volatility rates.
| Options granted on | ||||||||||||
| January 11, 2023 | January 11, 2023 | January 11, 2023 | ||||||||||
| Vesting dates | January 11, 2024 | January 11, 2024 | January 11, 2024 | |||||||||
| January 11, 2025 | January 11, 2025 | January 11, 2025 | ||||||||||
| January 11, 2026 | January 11, 2026 | January 11, 2026 | ||||||||||
| January 11, 2027 | January 11, 2027 | January 11, 2027 | ||||||||||
| Volatility | 97.11 | % | 105.11 | % | 116.33 | % | ||||||
| Dividend yield | 0 | % | 0 | % | 0 | % | ||||||
| Risk-free investment rate | 3.31 | % | 3.34 | % | 3.38 | % | ||||||
| Fair value of option at grant date | 0.87 | 1.19 | 1.19 | |||||||||
| Fair value of share at grant date | 1.23 | 1.23 | 1.23 | |||||||||
| Exercise price at grant date | 1.23 | 0.04 | 0.04 | |||||||||
| Lapse date | January 11, 2033 | January 11, 2033 | ||||||||||
| Expected option life (years) | 4.5 | 3.5 | 2.5 | |||||||||
| Number of options granted | 1,774,176 | 655,425 | 219,163 | |||||||||
| June 16, 2023 | June 16, 2023 | July 12, 2023 | ||||||||||
| Vesting dates | June 16, 2024 | June 16, 2024 | July 12, 2024 | |||||||||
| Volatility | 121.58 | % | 124.98 | % | 106.61 | % | ||||||
| Dividend yield | 0 | % | 0 | % | 0 | % | ||||||
| Risk-free investment rate | 4.98 | % | 4.99 | % | 5.21 | % | ||||||
| Fair value of option at grant date | 0.56 | 0.55 | 0.42 | |||||||||
| Fair value of share at grant date | 0.59 | 0.59 | 0.62 | |||||||||
| Exercise price at grant date | 0.04 | 0.04 | 0.62 | |||||||||
| Lapse date | June 16, 2033 | July 12, 2033 | ||||||||||
| Expected option life (years) | 2.0 | 1.0 | 3.0 | |||||||||
| Number of options granted | 37,500 | 9,375 | 37,500 |
For the three months ended September 30, 2023, the Company recognized 0.9 million of
share-based payment expense in the statement of operations (three months ended September 30, 2022: 1.2 million). For the nine months ended September 30, 2023, the Company has recognized 3.1 million of share-based payment
expense in the statement of operations (nine months ended September 30, 2022: 3.9 million).
9. Share capital and share premium
| September 30, 2023 | December 31, 2022 | |||||
| (in thousands) | ||||||
| Share capital | 2,111 | 2,095 | ||||
| Share premium | 141,289 | 141,108 | ||||
| 143,400 | 143,203 | |||||
| Number (in thousands) | ||||||
| Issued share capital comprises: | ||||||
| Ordinary shares of 0.04 each | 52,793 | 52,373 |
| Number of shares | Share capital | Share premium | ||||||||||
| (in thousands) | ||||||||||||
| Fully paid shares: | ||||||||||||
| Balance at December 31, 2022 | 52,373 | 2,095 | 141,108 | |||||||||
| Issue of shares on exercise of options | 55 | 2 | 1 | |||||||||
| Issue of shares | 365 | 14 | 180 | |||||||||
| Balance at September 30, 2023 | 52,793 | 2,111 | 141,289 |
| Legal proceedings | Dilapidations | Total | ||||||||||
| (in thousands) | ||||||||||||
| Balance at December 31, 2022 | 4,100 | 46 | 4,146 | |||||||||
| Additions | 21 | 21 | ||||||||||
| Reverse unused | (46 | ) | (46 | ) | ||||||||
| Utilized | (3,801 | ) | (9 | ) | (3,810 | ) | ||||||
| Transfer from prepayments, accrued income and other receivables | (247 | ) | (247 | ) | ||||||||
| Effect of foreign currency exchange differences | (6 | ) | (6 | ) | ||||||||
| Balance at September 30, 2023 | 58 | 58 | ||||||||||
| Classified as: | ||||||||||||
| Non-current | 58 | 58 | ||||||||||
| 58 | 58 |
All obligations arising from the patent infringement litigation in the U.K. and Germany, reflected within legal proceedings,
have been settled as at September 30, 2023.