TILS.L Regulatory News (TILS)

26 Sep 2006 08:00

ReGen Therapeutics PLC26 September 2006 Interim Results for the Six Months' to 30 June 2006 CHAIRMAN'S STATEMENT The first half sales figures, which relate entirely to Guildford ClinicalPharmacology Unit Limited ('GCPUL') are as expected at £55,000, reflecting thestart of a healthy upturn in business. As we reported earlier in the year 2006has been a much better year for new business, mainly due to our strengthening ofthe business team. Turnover for the first two months of the second half of theyear is £159,000. The directors are pleased to note that the current externalpipeline looking forward is around £750,000. Development costs increased by 15% reflecting our increased activity in thisarea, particularly in the development of ColostrininTM. Other costs, mainlysalaries, fell slightly as we kept strict control of expenditure. The interest in a biotech company, at this stage in its development, is notmainly about the revenue figures but in the Company's development prospects.Therefore, I give a short update of the developments so far this year in ourbusiness areas and likely further development. ColostrininTM We announced in July a licensing agreement with Metagenics Inc., a Californiandeveloper, manufacturer and marketer of science-based nutraceuticals and medicalfoods sold to healthcare professionals worldwide, for the sale of our product inNorth America through the professional channel. Subject to satisfactorycompletion of the conditions of the licensing agreement and requisite USregulatory filings, we continue to anticipate launch of a human nutraceuticalcontaining ColostrininTM during the first half of 2007. ColostrininTM peptides/peptide mimetics At the time of writing we are systematically evaluating a number of peptides foractivity. Our prime target remains Alzheimer's disease, particularly in view ofthe clinical results obtained from our trial RG 010 in Poland. We have, however,as we have announced, had results in a cell line model with one peptide, whichsuggests possible activity in Parkinson's disease. This and other relatedpeptides are now being screened to assess their potential in these and otherneurodegenerative diseases such as Multiple Sclerosis, Amyotrophic LateralSclerosis and Huntingdon's Chorea. We would hope to have a pre-clinicalcandidate or candidates during 2008. We also continue to explore licensing andfurther development opportunities. Zolpidem Our potential new use for zolpidem, which is in relation to secondary braintrauma following stroke, traumatic brain injury, vascular dementia and Bell'sPalsy has received considerable press attention. The effects of the drug havebeen reported particularly in an article in The Guardian of 12 September 2006,which includes a number of interesting case studies. In dry clinical speak a significant body of 'open' clinical case observationshas shown that zolpidem can normalise areas of brain dormancy secondary to aprimary lesion in brain damage conditions e.g. stroke, traumatic brain injury,vascular dementia and Bell's palsy. The clinical effects of this dormancyreversal generally depend on the extent of the dormant area and their importancebut have included restoration of consciousness, swallowing, co-ordination andmotor function. Whilst to date these effects have been achieved with existing 'high dose'formulations these are less than ideal for the new use, with sedation as asignificant limiting factor. ReGen is therefore looking to develop newformulations to optimise the delivery of this important clinical benefit to adiverse range of patients. Although the zolpidem composition of matter patent has lapsed in almost allcountries, and will finally expire this year, ReGen has patents pending on thisnew use. In addition to this potential use patent ReGen is also planning todefend its intellectual property position further with other patents such asthose derived from new formulations. An application to conduct a study is currently being reviewed by the SouthAfrican regulatory authorities. This will be a Phase IIa 'clinical proof ofconcept' study in known zolpidem responders and in collaboration with ReGen'ssubsidiary, GCPUL. This study will compare a 'low-dose' version of a sprayformulation with an existing 'high-dose' tablet formulation, hoping to achieveefficacy but without sedation. We currently expect clinical data to be available in the first quarter of 2007.If the data is positive we would look for a licensing deal. Our market estimatefor the drug is $4.3bn so that it should be attractive to even the largest ofdrug companies. GCPUL During 2005 and 2006 we restructured GCPUL. With an external pipeline currentlyin the region of £750,000 we believe that GCPUL is gaining strength in itsexternal market. We are also benefiting from having their advice on our clinicaldevelopment projects and using them to carry this out cost effectively. Financial As we announced on the 1 September 2006, we have convened an ExtraordinaryGeneral Meeting of the Company for 11.00 a.m. on 26 September 2006. At thatmeeting resolutions will be proposed to renew shareholder authority to be ableto issue shares and/or other securities of the Company to facilitate futurefundraisings (if required) and/or acquisitions of complementary businesses. I am aware that there has been considerable speculation over financing needs andI am pleased to report that we now have over £1.2m of cash in the bank takinginto account our placing in July, which raised £1.1m gross. Therefore thedirectors do not currently intend to raise further funds through a share issue. Conclusions As you can see from this report ReGen has progressed in all its areas. Wecontinue to look forward to the future with confidence and I would like to takethis opportunity on behalf of the Board to thank our staff for their continuinghard work and our shareholders for their valued support. Percy Lomax Executive Chairman 26 September 2006 For further information contact: Andrew Marshall Greycoat Communications Tel: 020 7960 6007 Mobile: 07785 297111 ReGen Therapeutics Plc Interim Results for the Six Months' to 30June 2006 Consolidated Profit and Loss AccountFor the six months ended 30 June 2006 Unaudited Unaudited Audited 6 months to 6 months to Year to 30-Jun-06 30-Jun-05 31-Dec-05 (£000) (£000) (£000) Turnover 55 100 116 Cost of sales 4 43 40 --------- --------- --------- Gross profit 51 57 76 Administrative costs Development costs 360 313 745 Other 760 780 1,497 Goodwill amortisation 48 47 94 --------- --------- --------- 1,168 1,140 2,336 Operating loss (1,117) (1,083) (2,260) Interest Receivable 11 24 47Interest Payable (5) (5) (10) --------- --------- --------- Loss on ordinary activities beforetaxation (1,111) (1,064) (2,223) Tax on ordinary activities (40) (30) (82) --------- --------- --------- Loss on ordinary activities aftertaxation (1,071) (1,034) (2,141) --------- --------- --------- Loss per share (basic and diluted) (0.21)p (0.30)p (0.56)p ReGen Therapeutics PlcConsolidated Balance Sheet Unaudited Unaudited Audited As at As at As at 30-Jun-06 30-Jun-05 31-Dec-05 (£000) (£000) (£000) Fixed AssetsIntangible assets 2,216 2,178 2,167Tangible assets 21 24 21 --------- --------- --------- 2,237 2,202 2,188 --------- --------- --------- Current assetsStocks 11 2 4Debtors 216 194 309Cash at bank 617 572 942 --------- --------- --------- 844 768 1,255 Creditors: amounts falling due within oneyear (547) (461) (618) --------- --------- --------- Net current assets 297 307 637 --------- --------- --------- Net assets 2,534 2,509 2,825 --------- --------- --------- Capital and reservesShare Capital - Issued and fully paid 583 342 500 - Deferred 5,298 5,298 5,298Share premium 11,112 9,173 10,438Other reserves 266 242 242Profit and loss account (14,725) (12,546) (13,653) --------- --------- --------- Equity shareholders' funds 2,534 2,509 2,825 --------- --------- --------- ReGen Therapeutics Plc Consolidated Cash Flow Statement Unaudited Unaudited Audited 6 months to 6 months Year to to 30-Jun-06 30-Jun-05 31-Dec-05 (£000) (£000) (£000) Operating loss (1,117) (1,083) (2,260)Amortisation 65 57 119Depreciation 3 4 8Increase in stocks (7) (1) (4)Decrease in debtors 133 957 832(Decrease)/increase in creditors (64) (117) 41 --------- --------- -------- Net cash outflow from operatingactivities (987) (183) (1,264) Returns on investments and servicing of financeInterest received 11 24 47Interest paid (5) (5) (10) Taxation - 43 104 Capital expenditure and financial investmentPayments to acquire tangible fixedassets (3) (10) (11)Payments to acquire intangible fixedassets (68) (45) (95) AcquisitionsPurchase of a subsidiary undertaking:Acquisition expenses (21) - - --------- --------- -------- Net cash outflow before management (1,073) (176) (1,229)of liquid resources and financing Management of liquid resourcesDecrease/(Increase) in short termdeposits 308 243 (175) FinancingProceeds of shares issued for cash 820 - 1,556Expenses paid on share issue (64) - (134) --------- --------- -------- 756 - 1,422 --------- --------- -------- (Decrease)/Increase in cash (9) 67 18 --------- --------- -------- Notes to the Interim Report: Basis of preparation The results for the six months ended 30 June 2006 are unaudited and have beenprepared on a basis consistent with the statutory accounts for the year ended 31 December 2005. The comparative amounts for the year ended 31 December 2005 do not constitute statutory accounts within the meaning of Section 240 of theCompanies Act 1985 but have been extracted from the audited statutory accountsdelivered to the Register of Companies on which the auditors issued an unqualified report which did not contain a statement under section 237 of that Act. Loss per share The calculation of loss per share is based on the weighted average numberof shares in issue for the period of 516,834,400 and the loss for the periodof £1,071,000. Reconciliation of movements in equity shareholders' funds 30-Jun-06 (£000) Loss for the six months (1,071)New shares issued 780 --------- Decrease to equity shareholders' funds (291) Opening equity shareholders' funds 2,825 ---------Closing equity shareholders' funds 2,534 ========= Intangible fixed assets Costs amounting to £68,000 relating to patent rights have been capitalised for the six months to 30 June 2006 in accordance with the company's stated accounting policy. Share Capital On 14 February 2006, the Company issued 1,562,500 ordinary shares of 0.1p eachat a premium of 1.5p per share for a consideration of £25,000 in exchange for100 £1 ordinary, the entire share capital of Sciencom Limited. In accordancewith Section 131 of the Companies Act 1985 this premium has not been recorded asshare premium. However, it has been included in other reserves. On 25 May 2006, the Company issued 77,500,000 ordinary shares of 0.1p each at apremium of 0.9p per share for a consideration of £775,000. On 8 June 2006, the Company issued 4,500,000 ordinary shares of 0.1p each at apremium of 0.9p per share for a consideration of £45,000. This information is provided by RNS The company news service from the London Stock Exchange