ValiRx Regulatory News (VAL)

VALIRX PLC

("ValiRx", "the Company" or "the Group")

FINAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2014

London, UK., 16 April 2015 - ValiRx Plc (AIM: VAL), a life science company with a focus on cancer therapeutics and diagnostics for personalised medicine, today announces its final results for the year ended 31 December 2014.

Corporate highlights

· Lead drug VAL201 in Phase l/ll dose escalation clinical trials in patients with locally advanced or metastatic prostate cancer and other advanced solid tumours at University College London Hospital

· Establishment of ValiSeek Limited, a risk-sharing joint venture company with Tangent Reprofiling Ltd, to take VAL401 to mid and late stage clinical trials for the treatment of lung cancer

· Detection of GeneICE targeting technologies and compounds accelerating through collaboration with world-renowned R&D institution, the German Cancer Research Centre, to bring personalised cancer treatment from laboratory to bedside

· Grant of new European and Japanese patents for ValiRx's novel cancer screening test biomarker, NAV3, further extending the geographic reach of the Company's intellectual property in a global cancer/tumour profiling market, which is forecast to grow at a CAGR of 18.5% to reach $US35 billion by 2018*

· Raise of £0.8m (before expenses) in equity finance in Q4

* http://www.marketsandmarkets.com/Market-Reports/cancer-tumor-profiling-market-1250.html

Post-period highlights

· Clinical Trials Review Committee gives go-ahead for VAL201 to advance to the second cohort of patients where further safety, tolerability as well as indicative efficacy will be assessed as dosage is escalated

· Cancer Research Technology Limited ("CRT") accepted shares in ValiRx, as payment for the successful trigger of a Phase I initiation milestone linked to VAL201 

· Strategic acquisition of complimentary proprietary gene expression and biomarker technology, TRAC, to provide a high-content gene expression analysis platform, enhancing ValiFinn's biomarker development and service offering to clinical research organisations and pharmaceutical companies

· Further placing of £0.8m in Q1 brings funds raised in under three months to £1.6 million, which leaves the Group adequately capitalised to reach its goals across all areas this year

Financial summary

· Revenues of £87,558 (2013: £124,868) with operating expenses rising 6% to £3,164,664 (2013: £2,984,337) after receipts of £210,802 of grants towards R&D (2013: £nil), as a result of increased R&D investment and overheads to drive VAL201 to Phase I/II clinical trials and complete the VAL401 safety toxicology studies before year-end

· Net loss after taxation was £3,244,471 (2013: £2,597,238)

· As at 31 December 2014 the Company had cash and cash equivalents of £452,824 (2013: £960,267). Cash position has since been increased by way of equity fund raise to provide the Company with a cash runway to meet its clinical development programmes in 2015

Oliver de Giorgio-Miller, Non-Exec Chairman of ValiRx, commented:

"Discovery and/or development of new cancer drugs is a risky business, but success can bring with it high reward. As a Company, we are totally dedicated to bringing to the world novel diagnostics and drugs that will fulfill hitherto unmet needs and will make a real difference to patients with cancer. I am impressed and excited by the continuing progress made by our R&D teams in the UK and Finland in the last 12 months. Our aim firmly remains to translate this corporate mission into reality. We now have VAL201 in clinical trials and doing well, both the VAL401 and GeneICE platform products approaching the clinical trial stage, and our developments in the Biomarkers and diagnostics arena progressing strongly."

"I am very grateful to and thank all of my colleagues at ValiRx for their commitment and hard work. I am also very appreciative of and thank our shareholders for their continued support."

*** ENDS ***

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Notes for Editors

ValiRx Plc

ValiRx Plc is a biopharmaceutical company developing novel technologies and products in oncology therapeutics and diagnostics. The product focus is in the epigenomic analysis and treatment of cancer, but the technologies can be applied to other fields as well, such as neurology and inflammatory diseases. 

The Company has undertaken to develop a novel and groundbreaking class of therapeutics across a number of fields in oncology and has taken its lead compound, Val201, into Phase I/II clinical trials. The Company listed on the Alternative Investment Market ("AIM") of the London Stock Exchange in October 2006.

The Company has a pipeline of other therapeutic drugs, which are currently progressing towards clinical trials. The product focus is in the targeted analysis and treatment of cancer, but the technologies can be applied to other fields as well, such as neurology and inflammatory diseases.

It actively manages projects within its portfolio as a trading company. The ValiRx business model spreads the risks of life science technology development by minimising financial exposure and running a set of projects to defined commercial endpoints. This maximises returns to shareholders by adding value at the earlier stages where value increases per investment unit are the greatest.

The Company operates through the following divisional companies:

1. ValiPharma is the therapeutics division, with two embedded technologies primarily directed at the treatment of cancers.

2. ValiFinn is the biomarkers and diagnostic development division. ValiRx acquired through its ValiFinn subsidiary, the complimentary TRAC technology later in the year to strengthen the portfolio.

3. ValiSeek is a joint venture between ValiRx and Tangent Ltd to develop Val401 in lung cancer and potentially other indications.

CHAIRMAN'S STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2014

I am pleased to report that in the last 12 months we have seen continued progress across all areas of our business.

We started the year in good financial shape having raised, in aggregate, £2.9 million before expenses at the start of January 2014 by way of a combination of an equity placing and an equity swap Agreement; the latter was exercised in full before the year end. Additional equity finance (£1.6m before expenses) was secured at the beginning of 2015.

A key priority for 2014 was to obtain the necessary formal regulatory permissions from the Medicine and Healthcare Products Regulatory Agency ("MHRA") and Ethics Committee to commence a Phase I/II, dose escalation study at University College London Hospital ("UCLH"), to assess the safety and tolerability of our lead drug VAL201 in patients with locally advanced or metastatic prostate cancer and other advanced solid tumours. These permissions were received in October 2014 at which point patient recruitment and testing began. We have since reported that VAL201 was safe and well tolerated at the doses tested in the first cohort and has now advanced to the next elevation of dose, where further safety and tolerability testing will be undertaken and early stage efficacy will be investigated as the trial progresses.

2014 also saw the establishment of a new subsidiary, ValiSeek Limited, a risk-sharing joint venture company with Tangent Reprofiling Limited. ValiSeek holds a worldwide exclusive licence from Tangent for the development and commercialisation of a novel cancer treatment, VAL401. In December 2014 we reported that in a GLP-regulatory toxicology study of VAL401 no adverse effects were seen throughout the experiment even at a dosage 60 times greater than the envisaged dose for patients. This study has completed the toxicology package required to support ValiSeek's approach to the regulatory authorities in 2015 with respect to advancing the drug towards pivotal clinical efficacy trials, initially in patients with lung cancer.

Another important accomplishment during the reporting period was the grant of new European and Japanese patents for our novel cancer screening test biomarker, NAV3, which is only one of five patent family assets within our Finland-based biomarker operation, ValiFinn Oy. Current diagnostic methods for cancer rely in the main on microscopic analysis of cells in biopsies. These work well in detecting established tumour cells. However at the early stage of cancer and before morphological changes have developed, such malignant cell detection is and remains difficult. The NAV3 gene biomarker is expected to be an important breakthrough as it enables the detection of cancer cells in tissue samples, whether they are primary tumours, metastases or pre-malignant cells, at a stage when tumour development is only about to start.

Lastly, in November 2014 we entered into a strategic alliance with one of the world's leading biomedical research institutions, Deutsches Krebsforschungzentrum (the German Cancer Research Center) in Heidelberg, aimed at accelerating the translation of the preclinical evidence that we have amassed in support of our GeneICE technology's potential to silence specific 'rebellious genes' implicated in causing cancers, and take individualised cancer medicine from bench to bedside. As part of the Agreement, ValiRx will retain all rights to new GeneICE compounds deriving from the collaboration.

Our financial results show revenues for the year at £87,558 (2013: £124,868) with operating expenses rising 6% to £3,164,664 (2013: £2,984,337) after receipts of £210,802 of grants towards R&D (2013: £nil), as a result of increased R&D investment and overheads to drive VAL201 to Phase I/II clinical trials, and complete the VAL401 safety toxicology studies before year-end. The net loss for the year increased to £3,160,031 (2013: £2,702,258) resulting in a reduced loss per share (basic and diluted) of 0.08p (2013: 0.15p). As at 31 December 2014 the Company had cash and cash equivalents of £452,824 (2013: £960,267); however, since the period end, our cash position has increased significantly following a further raising of equity finance, which we believe positions the Group well to reach its goals across all areas in 2015.

I should like to thank the Board and other colleagues at ValiRx, ValiFinn and ValiSeek for their contributions during another successful year and our shareholders for their continued support.

Oliver de Giorgio-Miller

Non-Exec Chairman

16 April 2015

CHIEF EXECUTIVE'S REPORT FOR THE YEAR ENDED 31 DECEMBER 2014

Following on from the chairman's comprehensive review I will comment on the events and activities that I feel are the most significant and will point the way to the future of the Company.

The big achievement and the very significant event of 2014 was the company receiving formal regulatory clearance to undertake and start a clinical trial of VAL201, a peptide directed at blocking, androgen induced cancer by inhibiting a particular function within large protein complexes, which goes by the acronym Src. It has been shown in many systems, tested by us, and others, that the effect VAL201 has in this situation is to prevent cancerous cells from dividing under the influence of androgen hormones.

Getting to this stage has been the culmination of an intense period of work, during which the project team has been required to provide sufficient robustly manufactured compound along with a large set of scientific data and toxicological information prior to submitting a Clinical Trial Application ("CTA"). A CTA comprises a full plan for all aspects of the proposed clinical trial. In conjunction with, and as is required, to the CTA an Investigational Medical Product Dossier ("IMPD") was produced. This is a document outlining all that is known about the science surrounding VAL201 and its proposed therapeutic use. The IMPD also details manufacture, storage and stability of VAL201 over time. Then, on top of this is the production of an Investigational Brochure ("IB"), which is a summary of the CTA and IMPD, but also includes medical information and is aimed primarily at its use in the clinic and wider community. I have to thank the team for this herculean effort and then driving through the regulatory process of the MHRA Regional Ethics Committee and the local R&D approvals, answering and responding to all requests and questions tirelessly.

Now that we are actually in the midst of the Trial at UCLH and with the initial results looking very encouraging, I am looking forward with optimism towards VAL201 and its future success.

The new subsidiary, a risk-sharing joint venture, ValiSeek Limited is a substantial development and brings a new novel cancer treatment, VAL401 to ValiRx. Using the infrastructure developed while getting VAL201 into the clinic and with the results we have obtained during the year, the preparation to take the therapy into efficacy trialing looks promising, especially as the safety and a human toxicology profile is well understood.

It should be noted that during the year the company was actively involved in a Eurostar European funded grant with partners in Finland and Germany as well as with various scientists and manufacturing concerns throughout Europe and wider. As the Chairman has already described, the strategic alliance with the world leading Deutsches Krebsforschungzentrum (the German Cancer Research Center) matters greatly in the continuing development of the GeneICE platform and potential products derived from it.

The continuing growth of activity in our Finnish subsidiary ValiFinn is pleasing and its core activities have progressed well and are in line with our plans. Of note are the developments surrounding NAV3 mentioned by the chairman. The work done by Valifinn, particularly in the progress and analysis of the trial of VAL201 and the efficacy assessments, should also be appreciated. Alongside this work, is the more mundane but important background routine clinical work for which Valifinn needs recognition. I should also record my pleasure at the acquisition of the TRAC technology from the administrators of Plexpress at the end of the year and early thereafter. It is too early to say much, but I believe the acquisition of this technology will be significant to ValiRx and its activities both internally and externally.

As far as the outlook for ValiRx is concerned, I am both excited and look forward greatly to continuing progress and advances from the Clinical trial of VAL201, from developments with both the VAL401 and GeneICE platform products, and with our developments in the Biomarkers and diagnostics arena.

I am very grateful and thank all of my colleagues at ValiRx for their commitment and hard work to give us this very successful and memorable year. I am also very appreciative of and thank our shareholders for their continued support.

Dr Satu Vainikka

Chief Executive

16 April 2015

STRATEGIC REPORT FOR THE YEAR ENDED 31 DECEMBER 2014

The directors present their strategic report for the year ended 31 December 2014.

The Company has undertaken to develop a novel and groundbreaking class of therapeutics across a number of fields in oncology and has taken its lead compound, Val201, into Phase I/II clinical trials. The Company listed on the Alternative Investment Market ("AIM") of the London Stock Exchange in October 2006.

The Company has a pipeline of other therapeutic drugs, which are currently progressing towards clinical trials. The product focus is in the targeted analysis and treatment of cancer, but the technologies can be applied to other fields as well, such as neurology and inflammatory diseases.

ValiRx actively manages projects within its portfolio as a trading company. The ValiRx business model spreads the risks of life science technology development by minimising financial exposure and running a set of projects to defined commercial endpoints. This maximises returns to shareholders by adding value at the earlier stages where value increases per investment unit are the greatest.

The Company operates through the following divisional companies:

1. ValiPharma is the therapeutics division, with two embedded technologies primarily directed at the treatment of cancers.

2. ValiFinn is the biomarkers and diagnostic development division. ValiRx acquired through its ValiFinn subsidiary, the complimentary TRAC technology later in the year to strengthen the portfolio.

3. ValiSeek is a joint venture between ValiRx and Tangent Ltd to develop Val401 in lung cancer and potentially other indications.

Business review

A review of the development and performance of the Group, including important events, progress during the year and likely future developments, can be found in the Chairman's Statement and the Chief Executive's Report.

Therapeutics

VAL201 Prostate Cancer

The Company's leading anti-cancer therapeutic VAL201 is currently in clinical trials for the treatment of prostate cancer and potentially other indications of hormone induced unregulated growth including endometriosis. The Phase I/II trial has been initiated and VAL201 was safe and well tolerated at the doses tested. Progressing through the dose escalation and expansion stages, the study is then designed to investigate further details of these aspects as well as efficacy. Particular emphasis will be placed on evaluating the pharmacokinetics, pharmacodynamics and early assessment of anti-tumour activity in response to VAL201, using a variety of measurements including ValiRx's biomarkers, with biomarkers being key indicators in personal medicine.

VAL201 selectively prevents tumour growth by specifically inhibiting the proliferation of tumour cells. As a result, tumour growth is suppressed and metastasis is significantly reduced. The approach is a targeted therapeutic with pre-clinical results that indicate that due to the specific nature of this treatment, this therapy is likely to be less toxic than many other therapeutic options. The VAL201 target is also associated with other cancers and there is significant potential for VAL201 to be used as a treatment for other hormone-induced cancers, such as breast and ovarian and also endometriosis.

Endometriosis

Endometriosis is a gynaecological medical condition in which cells from the lining of the uterus (endometrium) appear and flourish outside the uterine cavitylined by endometrial cells, which are under the influence of female hormones. These endometrial-like cells in areas outside the uterus (endometriosis) are influenced by hormonal changes and respond in a way that is similar to the cells found inside the uterus and symptoms often worsen with the menstrual cycle. The treatments chosen will depend on symptoms, age, and lifestyle plans. VAL201 has been shown though to reduce abnormal endometrial growth, whilst leaving other hormone-induced activities working normally. ValiRx's initial in-vitro results show a reduction in endometrial lesion size directly related to dose and two generations of offspring produced by treated animals. This strongly suggests that the peptide does not affect fertility the same way other treatments do.

VAL 401 Lung Cancer and others

VAL401 is the reformulation of a generic drug that has over 20 years of clinical use for treatment of a chronic non-oncology disease in an oral capsule. The re-formulation allows the drug to access previously unexploited anti-cancer activity. VAL401 is progressing satisfactorily through its remaining preclinical development and towards clinical Phase II trials for the treatment of lung cancer and other oncology indications. Progress into clinical trials will comprise a shorter than usual route to Market Authorisation by use of prior clinical data gathered on the original generic drug. Preclinical efficacy data has been collected in both non-small cell lung and prostate cancers. Preclinical toxicology has revealed no side effects beyond those expected from the parent drug, with preclinical pharmacokinetic data allowing bridging from VAL401 to the historical full clinical data package on the parent. Formulation stability tests are currently underway to complete the CMC package.

GeneICE

GeneICE "rebellious gene" technology continues to show good progress in the pre-clinical phase - the programme currently benefits from a second Eurostars grant for up to €1.6m.

Rebellious genes are genes that are overexpressed when they should not be or are erroneously expressed, e.g., in cancers, inflammatory conditions, Alzheimer's and autoimmune diseases. ValiRx's proprietary GeneICE technology enables the selective silencing of specific genes by targeted histone deacetylation leading to chromatin condensation. This prevents access and silences gene expression. In nature histone deacetylation of a particular gene is brought about by recruitment of a histone deacetylase complex (HDAC) to the gene. GeneICE constructs mimic this natural mechanism by delivery to the nucleus of a dual-module construct comprising: The binding of GeneICE construct to its target gene leads to deacetylation of the histones associated with the gene, localised chromatin condensation and gene silencing.

VAL101

VAL101 is a novel therapeutic based on the Company's proprietary GeneICE (Gene Inactivation by chromatin engineering) platform. It acts to target and switch "OFF" the gene that expresses Bcl-2, a protein that is implicated in about half of all carcinomas. Pre-clinical studies have established VAL101's efficacy in prostate, ovarian and pancreatic cancers, and it may also have anti-tumour activity against orphan oncologic indications. ValiRx's GeneICE technology enables the selective silencing or the shutting down of particular rebellious genes, thereby halting and reversing tumour growth.

Biomarkers and Diagnostics

Biomarker development programme, to support clinical and pre-clinical development, is continuing to produce results with the recent acquisition of complimentary TRAC technology.

The use of biomarkers with oncology therapeutics is one of the fastest growing areas of cancer research, as not only can the biomarkers identify patients who are more likely to respond to a particular drug therapy, but they can also indicate tumour progression.

ValiRx's biomarker subsidiary, ValiFinn in Finland provides the Group with exposure to the Biomarker market, a key and increasingly exciting field within its industry, but also to a revenue stream, derived from the provision of contract services to the pharmaceutical industry.

ValiFinn has built on its specialist biomarker expertise to develop its own companion diagnostic biomarkers to complement ValiRx's therapeutics, its existing intellectual property and its companion diagnostic activities, as well as marketing that expertise for the development programmes of other companies. Its services for consumers include biomarker measurements for health monitoring.

ValiFinn conducts the management of certain aspects of VAL201 late preclinical work and will assist in the regulatory work pertaining to the clinical trials and will manage certain aspects of the clinical work regarding hormone induced refractory cancer.

ValiRx's proprietary novel NAV3 Cancer Screening Test enables the detection of cancer cells in tissue samples, whether they are primary tumours, metastases or pre-malignant cell, at a stage when tumour development is only about to start. The test is based on the detection of specific changes in the NAV3 gene and the system of tests can be applied to a range of cancers.

'Transcript Analysis with the Aid of Affinity Capture' or TRAC technology enables the efficient screening of a large number of drug candidates for a wide range of genetic safety and efficacy markers. The technology platform already has an established customer base and it has been generating revenue since 2012. Going forward, ValiRx will look to leverage upon TRAC's market presence and grow the sales of this diagnostic business. The Company believes that together with clinical validation, revenues from TRAC will grow, which will support both the biomarker and therapeutic development businesses. ValiFinn, which is itself already generating revenues, is well placed to further develop as a service/licensing business.

Oliver de Giorgio-Miller

Non-Exec Chairman

16 April 2015

1. Basis of Preparation

The financial information set out above does not constitute the Company's statutory accounts for the year ended 31 December 2014, but is derived from those accounts. Statutory accounts for 2014 will be delivered to the Registrar of Companies following the Company's annual general meeting.

2. Loss per ordinary share

3. Publication of Report & Accounts

The report and accounts for the year ended 31 December 2014 will be posted to shareholders shortly and will be available from the Company's website, www.valirx.com