Full Press Release Details
Summit Therapeutics plc
( Summit , the Company or the Group )
SUMMIT THERAPEUTICS REPORTS FINANCIAL RESULTS FOR THE
FIRST QUARTER ENDED 30 APRIL 2017 AND OPERATIONAL PROGRESS
Oxford, UK, 14 June 2017 Summit Therapeutics plc (AIM: SUMM, NASDAQ: SMMT), the drug discovery and development company
advancing therapies for Duchenne muscular dystrophy ( DMD ) and C. difficile infection ( CDI ), today reports its unaudited financial results for the first quarter ended 30 April 2017.
Mr Glyn Edwards, Chief Executive Officer of Summit, commented: Over the past quarter and in recent months, we have made meaningful advances in
both our DMD and CDI programmes to bring these programmes closer to the patients in need. We continue to progress our PhaseOut DMD clinical trial of our lead utrophin modulator, ezutromid, in the treatment of DMD. We achieved a major milestone in
the programme with the completion of enrolment into PhaseOut DMD, triggering a $22 million payment from Sarepta. In addition, we have made provisions for patients in the trial to remain on ezutromid beyond the initial 48-weeks of the trial, which will allow us to monitor safety and efficacy data related to longer-term dosing. We look forward to reporting 24-week biopsy, MRI and functional
data in the first quarter of 2018 for what could be the first disease modifying treatment for all patients with DMD.
prepare our other lead product candidate, ridinilazole, for Phase 3 clinical development, a recent Lancet Infectious Diseases publication highlighted the novel antibiotic s differentiation and promise as a potential treatment for CDI, as
evidenced by the Phase 2 CoDIFy clinical data. We believe the robust design of the Phase 3 clinical programme, which has received input from the US Food and Drug Administration and European Medicines Agency, has the potential to underpin
ridinilazole as a potential front-line treatment for CDI.
Utrophin Modulation Programme for DMD
Ezutromid Highlights
Ridinilazole Highlights
Financial Highlights
About Summit Therapeutics
Summit is a biopharmaceutical
company focused on the discovery, development and commercialisation of novel medicines for indications for which there are no existing or only inadequate therapies. Summit is conducting clinical programmes focused on the genetic disease Duchenne
muscular dystrophy and the infectious disease C. difficile infection. Further information is available at www.summitplc.com and Summit can be followed on Twitter (@summitplc).
For more information, please contact:
| Summit Therapeutics Glyn Edwards / Richard Pye (UK office) Erik Ostrowski / Michelle Avery (US office) | Tel: +44 (0)1235 443 951 +1 617 225 4455 | |
| Cairn Financial Advisers LLP (Nominated Adviser) Liam Murray / Tony Rawlinson | Tel: +44 (0)20 7213 0880 |
| N+1 Singer (Broker) Aubrey Powell / Lauren Kettle | Tel: +44 (0)20 7496 3000 | |
| MacDougall Biomedical Communications (US media contact) Karen Sharma | Tel: +1 781 235 3060 ksharma@macbiocom.com | |
| Consilium Strategic Communications (Financial public relations, UK) Mary-Jane Elliott / Sue Stuart / Jessica Hodgson / Lindsey Neville | Tel: +44 (0)20 3709 5700 summit@consilium-comms.com |
Forward Looking Statements
Any statements in this press release about our future expectations, plans and prospects, including statements about development and potential commercialisation
of our product candidates, the therapeutic potential of our product candidates, the timing of initiation, completion and availability of data from clinical trials, the potential benefits and future operation of the collaboration with Sarepta
Therapeutics Inc., including any potential future payments thereunder, any other potential third-party collaborations and expectations regarding the sufficiency of our cash balance to fund operating expenses and capital expenditures, and other
statements containing the words anticipate, believe, continue, could, estimate, expect, intend, may, plan, potential,
predict, project, should, target, would, and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual
results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: the uncertainties inherent in the initiation of future clinical trials, availability and timing of data from
ongoing and future clinical trials and the results of such trials, whether preliminary results from a clinical trial will be predictive of the final results of that trial or whether results of early clinical trials will be indicative of the results
of later clinical trials, expectations for regulatory approvals, availability of funding sufficient for our foreseeable and unforeseeable operating expenses and capital expenditure requirements and other factors discussed in the Risk
Factors section of filings that we make with the Securities and Exchange Commission, including our Annual Report on Form 20-F for the fiscal year ended 31 January 2017. In addition, any
forward-looking statements included in this press release represent our views only as of the date of this release and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update
any forward-looking statements included in this press release.
Revenue was 1.7 million for the three
months ended 30 April 2017 compared to nil for the three months ended 30 April 2016. This increase resulted from the exclusive licence and collaboration agreement entered into with Sarepta in October 2016, from which the Company
received an upfront payment of 32.8 million ($40 million). Of this amount 4.0 million in the aggregate has been recognised to date. The remaining 28.8 million of the upfront payment is classified as deferred
revenue and will continue to be recognised as revenue over the development period.
Other Operating Income
There were no sources of other operating income during the three months ended 30 April 2017 compared to 0.06 million recognised during the
three months ended 30 April 2016. The decrease is due to the Company s withdrawal from the Innovate UK funding agreement in September 2016 in order to enable the Company to take advantage of more tax efficient opportunities related to
research and development expenditure.
Research and Development Expenses
development expenses increased by 0.2 million to 5.0 million for the three months ended 30 April 2017 from 4.8 million for the three months ended 30 April 2016. The increase is driven by an overall
increase in investment in the DMD programme of 0.7 million and an increase of 0.1 million in research and development related staffing costs offset by a decrease in CDI clinical programme related activities of
General and Administration Expenses
General and administration expenses increased by 1.0 million to 2.4 million for the three months ended 30 April 2017 from
1.4 million for the three months ended 30 April 2016. This increase was primarily due to a net negative movement of 0.5 million in exchange rate variance, an increase of 0.3 million in staff related costs and
an increase of 0.2 million in legal and professional fees.
Following an International Financial Reporting Standards Interpretations Committee agenda decision in May 2016 on the application of International Accounting
Standards 20 Government Grants, the Company has changed its accounting policy regarding charitable funding arrangements from the Wellcome Trust and US not for profit organisations for the year ended 31 January 2017. See Note 1
Change in accounting policy below. This change in accounting policy has been reflected retrospectively in the comparative financial statements for the three months ended 30 April 2016. Finance costs relate to the subsequent re-measurement of the financial liability recognised in respect of income arrangements and the unwinding of the discounts associated with the liabilities. Finance costs remained consistent at 0.2 million
for the three months ended 30 April 2017 and for the three months ended 30 April 2016 (adjusted).
Operating Activities
Net cash used in operating
activities for the three months ended 30 April 2017 was 8.0 million compared to 6.4 million for the three months ended 30 April 2016. This movement of 1.6 million was driven by an increase in research
and development expenses and general and administrative expenses during the three months ended 30 April 2017.
Investing Activities
Net cash used in investing activities for the three months ended 30 April 2017 was 0.3 million compared to 4,000 for the three months
ended 30 April 2016. This includes the net amount of bank interest received on cash deposits less amounts paid to acquire property, plant and equipment. During the three months ended 30 April 2017, the Group relocated its UK offices.
Financing Activities
Net cash inflow from financing activities for the three months ended 30 April 2017 of 0.01 million relates to proceeds from the exercise of
warrants and the exercise of share options. For the three months ended 30 April 2016, the Company received proceeds of 0.1 million from the exercise of warrants.
As at 30 April 2017, total cash
and cash equivalents were 19.4 million compared to 28.1 million at 31 January 2017.
Due to the recognition of deferred
revenue associated with the Sarepta agreement and the recognition of a financial liability on funding arrangements resulting from a change in accounting policy, the Consolidated Statement of Financial Position continues to be in a net liability
| Glyn Edwards | Erik Ostrowski | |
| Chief Executive Officer | Chief Financial Officer |
FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (unaudited)
For the three months ended 30 April 2017
| Note | Three months ended 30 April 2017 $000s | Three months ended 30 April 2017 000s | Three months ended 30 April 2016 Adjusted* 000s | |||||||||||||
| Revenue | 2,236 | 1,728 | ||||||||||||||
| Other operating income | 59 | |||||||||||||||
| Operating expenses | ||||||||||||||||
| Research and development | (6,515 | ) | (5,035 | ) | (4,806 | ) | ||||||||||
| General and administration | (3,149 | ) | (2,434 | ) | (1,432 | ) | ||||||||||
| Total operating expenses | (9,664 | ) | (7,469 | ) | (6,238 | ) | ||||||||||
| Operating loss | (7,428 | ) | (5,741 | ) | (6,179 | ) | ||||||||||
| Finance income | 2 | 1 | 3 | |||||||||||||
| Finance cost | 1 | (290 | ) | (224 | ) | (194 | ) | |||||||||
| Loss before income tax | (7,716 | ) | (5,964 | ) | (6,370 | ) | ||||||||||
| Income tax | 1,556 | 1,203 | 935 | |||||||||||||
| Loss for the period | (6,160 | ) | (4,761 | ) | (5,435 | ) | ||||||||||
| Other comprehensive loss | ||||||||||||||||
| Items that may be reclassified subsequently to profit or loss | ||||||||||||||||
| Exchange differences on translating foreign operations | (20 | ) | (15 | ) | (5 | ) | ||||||||||
| Total comprehensive loss for the period | (6,180 | ) | (4,776 | ) | (5,440 | ) | ||||||||||
| Basic and diluted loss per Ordinary Share from operations | 2 | (10)cents | (8)pence | (9)pence |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (unaudited)
| 30 April 2017 | 30 April 2017 | 31 January 2017 | ||||||||||||||
| Note | $000s | 000s | 000s | |||||||||||||
| ASSETS | ||||||||||||||||
| Non-current assets | ||||||||||||||||
| Goodwill | 859 | 664 | 664 | |||||||||||||
| Intangible assets | 4,440 | 3,432 | 3,470 | |||||||||||||
| Property, plant and equipment | 611 | 472 | 116 | |||||||||||||
| 5,910 | 4,568 | 4,250 | ||||||||||||||
| Current assets | ||||||||||||||||
| Prepayments and other receivables | 1,952 | 1,509 | 1,027 | |||||||||||||
| Current tax receivable | 7,071 | 5,466 | 4,248 | |||||||||||||
| Cash and cash equivalents | 25,050 | 19,362 | 28,062 | |||||||||||||
| 34,073 | 26,337 | 33,337 | ||||||||||||||
| Total assets | 39,983 | 30,905 | 37,587 | |||||||||||||
| LIABILITIES | ||||||||||||||||
| Non-current liabilities | ||||||||||||||||
| Deferred revenue | (28,317 | ) | (21,887 | ) | (23,615 | ) | ||||||||||
| Financial liabilities on funding arrangements | 1 | (7,948 | ) | (6,143 | ) | (5,919 | ) | |||||||||
| Provisions for other liabilities and charges | (129 | ) | (100 | ) | (85 | ) | ||||||||||
| Deferred tax liability | (731 | ) | (565 | ) | (565 | ) | ||||||||||
| (37,125 | ) | (28,695 | ) | (30,184 | ) | |||||||||||
| Current liabilities | ||||||||||||||||
| Trade and other payables | (4,130 | ) | (3,192 | ) | (3,984 | ) | ||||||||||
| Provisions for other liabilities and charges | (110 | ) | (85 | ) | ||||||||||||
| Deferred revenue | (8,942 | ) | (6,912 | ) | (6,912 | ) | ||||||||||
| (13,182 | ) | (10,189 | ) | (10,896 | ) | |||||||||||
| Total liabilities | (50,307 | ) | (38,884 | ) | (41,080 | ) | ||||||||||
| Net liabilities | (10,324 | ) | (7,979 | ) | (3,493 | ) | ||||||||||
| EQUITY | ||||||||||||||||
| Share capital | 801 | 619 | 618 | |||||||||||||
| Share premium account | 60,073 | 46,432 | 46,420 | |||||||||||||
| Share-based payment reserve | 7,003 | 5,413 | 5,136 | |||||||||||||
| Merger reserve | (2,513 | ) | (1,943 | ) | (1,943 | ) | ||||||||||
| Special reserve | 25,867 | 19,993 | 19,993 | |||||||||||||
| Currency translation reserve | 45 | 35 | 50 | |||||||||||||
| Accumulated losses reserve | (101,600 | ) | (78,528 | ) | (73,767 | ) | ||||||||||
| Total deficit | (10,324 | ) | (7,979 | ) | (3,493 | ) |
CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)
For the three months ended 30 April 2017
| Three months ended 30 April 2017 $000s | Three months ended 30 April 2017 000s | Three months ended 30 April 2016 Adjusted* 000s | ||||||||||
| Cash flows from operating activities | ||||||||||||
| Loss before income tax | (7,716 | ) | (5,964 | ) | (6,370 | ) | ||||||
| Adjusted for: | ||||||||||||
| Finance income | (1 | ) | (1 | ) | (3 | ) | ||||||
| Finance cost | 290 | 224 | 194 | |||||||||
| Foreign exchange loss | 612 | 473 | 45 | |||||||||
| Depreciation | 30 | 23 | 11 | |||||||||
| Amortisation of intangible fixed assets | 3 | 2 | 2 | |||||||||
| Loss on disposal of assets | 48 | 37 | ||||||||||
| Movement in provisions | 7 | |||||||||||
| Research and development expenditure credit | (3 | ) | ||||||||||
| Share-based payment | 358 | 277 | 336 | |||||||||
| Adjusted loss from operations before changes in working capital | (6,376 | ) | (4,929 | ) | (5,781 | ) | ||||||
| Increase in prepayments and other receivables | (624 | ) | (482 | ) | (509 | ) | ||||||
| Decrease in deferred revenue | (2,236 | ) | (1,728 | ) | ||||||||
| Decrease in trade and other payables | (1,034 | ) | (798 | ) | (78 | ) | ||||||
| Cash used by operations | (10,270 | ) | (7,937 | ) | (6,368 | ) | ||||||
| Taxation paid | (19 | ) | (15 | ) | ||||||||
| Net cash used by operating activities | (10,289 | ) | (7,952 | ) | (6,368 | ) | ||||||
| Investing activities | ||||||||||||
| Purchase of property, plant and equipment | (362 | ) | (280 | ) | (7 | ) | ||||||
| Interest received | 1 | 1 | 3 | |||||||||
| Net cash used in investing activities | (361 | ) | (279 | ) | (4 | ) | ||||||
| Financing activities | ||||||||||||
| Proceeds from exercise of warrants | 13 | 10 | 107 | |||||||||
| Proceeds from exercise of share options | 4 | 3 | ||||||||||
| Net cash generated from financing activities | 17 | 13 | 107 | |||||||||
| Decrease in cash and cash equivalents | (10,633 | ) | (8,218 | ) | (6,265 | ) | ||||||
| Effect of exchange rates in cash and cash equivalents | (624 | ) | (482 | ) | (50 | ) | ||||||
| Cash and cash equivalents at beginning of the period | 36,307 | 28,062 | 16,304 | |||||||||
| Cash and cash equivalents at end of the period | 25,050 | 19,362 | 9,989 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (unaudited)
Three months ended 30 April 2017
| Group | Share capital 000s | Share premium account 000s | Share-based payment reserve 000s | Merger reserve 000s | Special reserve 000s | Currency translation reserve 000s | Accumulated losses reserve 000s | Total 000s | ||||||||||||||||||||||||
| At 1 February 2017 | 618 | 46,420 | 5,136 | (1,943 | ) | 19,993 | 50 | (73,767 | ) | (3,493 | ) | |||||||||||||||||||||
| Loss for the period | (4,761 | ) | (4,761 | ) | ||||||||||||||||||||||||||||
| Currency translation adjustment | (15 | ) | (15 | ) | ||||||||||||||||||||||||||||
| Total comprehensive loss for the period | (15 | ) | (4,761 | ) | (4,776 | ) | ||||||||||||||||||||||||||
| New share capital issued from exercise of warrants | 1 | 9 | 10 | |||||||||||||||||||||||||||||
| Share options exercised | 3 | 3 | ||||||||||||||||||||||||||||||
| Share-based payment | 277 | 277 | ||||||||||||||||||||||||||||||
| At 30 April 2017 | 619 | 46,432 | 5,413 | (1,943 | ) | 19,993 | 35 | (78,528 | ) | (7,979 | ) | |||||||||||||||||||||
| Year ended 31 January 2017 | ||||||||||||||||||||||||||||||||
| Group | Share capital 000s | Share premium account 000s | Share-based payment reserve 000s | Merger reserve 000s | Special reserve 000s | Currency translation reserve 000s | Accumulated losses reserve 000s | Total 000s | ||||||||||||||||||||||||
| At 1 February 2016 | 613 | 46,035 | 3,757 | (1,943 | ) | 19,993 | 21 | (52,396 | ) | 16,080 | ||||||||||||||||||||||
| Loss for the year | (21,371 | ) | (21,371 | ) | ||||||||||||||||||||||||||||
| Currency translation adjustment | 29 | 29 | ||||||||||||||||||||||||||||||
| Total comprehensive loss for the year | 29 | (21,371 | ) | (21,342 | ) | |||||||||||||||||||||||||||
| New share capital issued from exercise of warrants | 2 | 105 | 107 | |||||||||||||||||||||||||||||
| Share options exercised | 3 | 280 | 283 | |||||||||||||||||||||||||||||
| Share-based payment | 1,379 | 1,379 | ||||||||||||||||||||||||||||||
| At 31 January 2017 | 618 | 46,420 | 5,136 | (1,943 | ) | 19,993 | 50 | (73,767 | ) | (3,493 | ) | |||||||||||||||||||||
| Three months ended 30 April 2016 (Adjusted*) | ||||||||||||||||||||||||||||||||
| Group | Share capital 000s | Share premium account 000s | Share-based payment reserve 000s | Merger reserve 000s | Special reserve 000s | Currency translation reserve 000s | Accumulated losses reserve 000s | Total 000s | ||||||||||||||||||||||||
| At 1 February 2016 | 613 | 46,035 | 3,757 | (1,943 | ) | 19,993 | 21 | (52,396 | ) | 16,080 | ||||||||||||||||||||||
| Loss for the period | (5,435 | ) | (5,435 | ) | ||||||||||||||||||||||||||||
| Currency translation adjustment | (5 | ) | (5 | ) | ||||||||||||||||||||||||||||
| Total comprehensive loss for the period | (5 | ) | (5,435 | ) | (5,440 | ) | ||||||||||||||||||||||||||
| New share capital issued from exercise of warrants | 2 | 105 | 107 | |||||||||||||||||||||||||||||
| Share-based payment | 336 | 336 | ||||||||||||||||||||||||||||||
| At 30 April 2016 | 615 | 46,140 | 4,093 | (1,943 | ) | 19,993 | 16 | (57,831 | ) | 11,083 |
NOTES TO THE FINANCIAL STATEMENTS
For the three months ended 30 April 2017
The unaudited consolidated interim financial statements of Summit and its subsidiaries (the Group ) for the three months ended
30 April 2017 have been prepared in accordance with International Financial Reporting Standards ( IFRS ) and International Financial Reporting Interpretations Committee ( IFRIC ) interpretations as issued by the
International Accounting Standards Board and as adopted by the European Union and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS including those applicable to accounting periods ending 31 January 2018
and the accounting policies set out in Summit s consolidated financial statements. They do not include all the statements required for full annual financial statements, and should be read in conjunction with the consolidated financial
statements of the Group as at 31 January 2017 (the 2017 Accounts ). The 2017 Accounts, on which the Company s auditors delivered an unqualified audit report, will be delivered to the Registrar of Companies following the 2017
Annual General Meeting.
The interim financial statements are prepared in accordance with the historical cost convention. Whilst the financial information
included in this announcement has been prepared in accordance with IFRSs as issued by the International Accounting Standards Board and adopted for use in the European Union, this announcement does not itself contain sufficient information to comply
The Group expects it will need to raise additional funding in the future in order to support research and development efforts, potential
commercialisation related activities if any of its product candidates receive marketing approval, as well as to support activities associated with operating as a public company in both the United States and the United Kingdom. Management expects to
finance its cash needs through a combination of some, or all, of the following: equity offerings, collaborations, strategic alliances, grants and clinical trial support from government entities, philanthropic,
non-government and not for profit organisations and patient advocacy groups, debt financings, and marketing, distribution or licensing arrangements.
After review of the future operating costs of the business in conjunction with the cash held at 30 April 2017 and the $22 million development
milestone now due as detailed in Note 4, Subsequent events, management is confident about the Group s ability to continue as a going concern and accordingly the interim financial statements have been prepared on a going concern
The financial information for the three month periods ended 30 April 2017 and 2016 are unaudited.
Solely for the convenience of the reader, unless otherwise indicated, all pound sterling amounts stated in the Consolidated Balance Sheet as at 30 April