RNS Number:9898P
Futura Medical PLC
22 September 2003
Press Release 22 September 2003
Futura Medical plc
Interim Results for the six months ended 31 July 2003
Futura Medical plc ("Futura Medical", "Futura" or "the Company"), the
pharmaceutical and medical device group that develops innovative products for
the sexual healthcare market, reports Interim Results for the six months ended
31 July 2003.
Highlights
* Completion of #1.7 million private placement, followed by introduction to
AIM on 22 July 2003
* Completion of the Phase II study for MED2001; now patent-protected in 22
countries
* Global distribution agreement for CSD500 product
* Boardroom strengthened by two key appointments
* Financial strategy in place, with costs strictly controlled
* Operating loss of #966k (1H 2002 loss of #614k), including #351,000 of AIM
admission costs
* Loss per share - basic 2.1p (1H 2002: 1.3p)
* #2.05 million cash at 31 July 2003
Commenting on Futura's first set of Results since listing, James Barder, Chief
Executive, said:
"We are well on track in building a successful pharmaceutical and medical device
group to serve the growing sexual healthcare market, and I hope to report
further progress by the end of the year."
For further information, please contact:
Futura Medical plc
James Barder, Chief Executive Tel: +44 01483 845 670
Email: james.barder@futuramedical.co.uk
Media enquiries:
Bankside
Peter Curtain / Alex Tweed Tel: +44 (0) 20 7444 4140
Email: alexandra.tweed@bankside.com
Chairman and Chief Executive Joint Interim Statement
The six months to the end of July were a period of significant transformation
for Futura Medical plc ("Futura" or the "Company"), leading to both the
Introduction of Futura to the Alternative Investment Market ("AIM") on 22 July
2003 as well as a successful private placement immediately preceding this, which
raised #1.7 million.
In addition, development continues apace with the completion of the Phase II
double-blind, placebo controlled, escalating-dose study for MED2001 and the
signing of a global distribution agreement for CSD500 with LRC Products Limited,
(a wholly owned subsidiary of SSL International plc, the distributors of the
DurexTM brand condom range).
Company Matters - Financial update
Both Richard Drury and Amanda Staveley stepped down from the Board due to their
other business commitments and in the knowledge of the increasing workload from
Futura following our Introduction to AIM. We would like to take this
opportunity to thank them for their contribution to the Board over the past two
years.
In their place we welcomed both Jonathan Freeman, a former director of the
stockbrokers Beeson Gregory and current partner of Gambit Corporate Finance with
over 10 years experience in corporate finance, and Andrew Slater, a former main
board director of SSL International plc with over 20 years of international
healthcare marketing experience.
We continue to focus on maintaining a tight control on expenditure. Our overall
loss for the six months ended 31 July 2003 of #966,334 includes AIM Admission
costs of #351,299 (36% of the loss). The balance of operating loss of #615,035
is broadly in line with the prior year. Overall costs continue to be within our
internal budgets. Cash at the end of July 2003 was in excess of #2 million.
The Board recently approved a change in our financial year-end, which will now
be 31 December as opposed to 31 January. The next set of full financial
statements will therefore be for the 11 months ending 31 December 2003. The
next Interim statement will be for the 6 months ending 30 June 2004.
Product Development
MED2001 - EroxonTM
Treatment for Erectile Dysfunction
Following the completion of our Phase II double-blind, placebo controlled,
escalating-dose ranging study, we are pleased to report a good safety profile
for the product.
The study was conducted to the standards of Good Clinical Practice, as defined
by the International Committee on Harmonisation, by internationally renowned and
experienced investigators who had conducted previous clinical trials of other
drugs for the treatment of erectile dysfunction ("ED"). 67 subjects with an
average age of 48 years and average disease duration of two years were
recruited. All subjects were diagnosed as suffering from mild to moderate ED
(based on medically accepted diagnostic criteria) from psychogenic, organic or
"mixed" origins.
The primary purpose of this study was to assess safety on a dose-escalating
basis and we were pleased to say that MED2001 was well tolerated. The systemic
adverse events, which were mostly mild and moderate headaches in some subjects,
were in line with expectations and suggested a dose-related response. Local
tolerability was also good.
A secondary objective of the study was to determine if a dose related efficacy
response could be seen. Analysis is still ongoing and, although some dose
related trends against placebo were seen, these trends did not achieve
statistical significance. This was in part due to the large degree of inter and
intra subject variability, taken together with an unexpectedly high placebo
response of nearly 60% and the limited size of the study. All ED studies show a
significant placebo response, typically 30%, which is partly attributed to the
psychogenic issues surrounding ED sufferers. The mode of application of MED2001
(a cream being massaged directly onto the glans of the penis versus taking a
pill) is thought to have contributed to this unexpectedly high placebo effect.
Analyses of the efficacy data using more appropriate statistical techniques to
accommodate the large inter and intra subject variability is continuing.
The phase III clinical trial program will recruit larger patient numbers. This
is the phase of development where we would expect to generate statistically
significant results on efficacy. Given our experience from the Phase II study,
close attention will be given to the study design and methods of analysis to
manage the placebo response and minimise the impact on the study conclusions.
In the past few weeks, we have conducted a rigorous review of all our clinical
studies using appropriate external advisers. In light of this review we have
recently modified our regulatory strategy to seek to license MED2001 as a
pharmacy line product rather than a prescription only medicine within the EU.
ED is understandably considered an embarrassing condition, although the
publicity surrounding the launch and promotion of ViagraTM and more recently
LevitraTM has increased public awareness and acceptability of ED. Nevertheless
it is widely recognised that only around one in five men will go to his General
Practitioner to seek treatment for ED. We believe that MED2001, as potentially
the first ethical 'over the counter' treatment within the EU, will considerably
help address the embarrassment problem faced by many ED sufferers. It could
also have the added advantage of removing the issues facing many governments
over the state funding of what is considered by some to be 'lifestyle'
medication.
Our patent applications for MED2001 continue, with the patent now granted in 22
territories.
It has always been our strategy to seek distribution agreements with
pharmaceutical distributors once we are at an advanced stage of development with
a particular product, thereby maximising the potential royalty stream to the
Company. We have been able to adopt this strategy due to the loyalty and
financial support of our shareholders. Over the past years we have received
significant interest from a number of pharmaceutical groups interested in
distribution rights for MED2001 in some 30 different territories throughout the
world. Until recently, we have deliberately deferred serious discussions for
the reasons already outlined, however we will be working closely with a number
of these companies over the next few months with a view to concluding
distribution agreements and finalising the necessary development work as we move
into the final stages of the completion of the MED2001 dossier.
While both pharmaceutical development and commercial negotiation can proceed
slowly, we would hope to report to shareholders further progress by the end of
the year.
CSD500 - ZanifilTM
Condom safety device
Early in the year we signed a global distribution agreement with the world's
largest branded condom manufacturer and distributor, SSL International plc
(makers of the DurexTM condom range) for the lifetime of the patents. The
precise terms of the agreement are commercially sensitive and therefore must
remain confidential. The non-confidential details were disclosed in our AIM
Admission document at the time of our Introduction to AIM. We are delighted to
have signed a distribution with such a powerful brand, which should generate
significant revenue for the Company once CSD500 is licensed.
Completion of the EU dossier continues, with an anticipated submission in 2004.
The approval process in other non-EU territories will be facilitated once
approval has been given within the EU. Nevertheless, discussions have already
commenced with the FDA and we will be working closely in collaboration with the
FDA to achieve regulatory approval within the United States.
FLD500
Female lubrication device
The protocol for a proof of concept study, largely to determine a safe and well
tolerated dose, on 10 female subjects has recently been submitted to the
necessary authorities for ethical approval. Once this is granted, we anticipate
the study commencing at the Porterbrook clinic in Sheffield.
Conclusion
The mandate from our shareholders has always been to seek to develop and license
MED2001 and CSD500. One of the reasons for listing Futura on AIM was to
increase the public profile of Futura in order to identify potential product
distributors and also new development opportunities. As both CSD500 and MED2001
progress to the more advanced stage of their development, we emphasise our
continuing interest in identifying and developing other pharmaceutical drugs or
devices. They should be related to sexual health and well-being and be able to
justify commercially their development costs.
Finally, what has been summarised in this report does little justice to the
amount of work undertaken not only by the staff of Futura but also by our small
army of extremely professional consultants and advisers, to whom we are
extremely grateful.
Dr William D Potter James H Barder
Non-Executive Chairman Chief Executive
CONSOLIDATED PROFIT AND LOSS ACCOUNT
For the six months ended 31 July 2003
Unaudited Unaudited Audited
six months six months year ended
ended 31 July ended 31 July 31 January
2003 2002 2003
# # #
Notes
Research and development costs (349,942) (369,499) (810,754)
AIM admission costs 2 (351,299) - -
Other administrative costs (265,093) (244,826) (485,322)
Administrative expenses (616,392) (244,826) (485,322)
Operating loss (966,334) (614,325) (1,296,076)
Other interest receivable and similar income 20,290 30,081 59,534
Interest payable and similar charges (362) (505) (714)
Loss on ordinary activities before taxation (946,406) (584,749) (1,237,256)
Tax on loss on ordinary activities 3 58,786 77,505 152,175
Loss on ordinary activities after taxation and 4 (887,620) (507,244) (1,085,081)
loss for the period
(Loss) per share - basic 5 (2.1) (1.3) (2.7)
(Loss) per share - full diluted 5 - - -
All amounts relate to continuing activities.
Statement of Total Recognised Gains and Losses
There were no recognised gains and losses in the period, or in the prior
periods, other than those passing through the profit and loss account above and
therefore no separate statement of total recognised gains and losses has been
presented.
CONSOLIDATED BALANCE SHEET
For the six months ended 31 July 2003
Unaudited Unaudited Audited
31 July 31 July 31 January
2003 2002 2003
Notes # # #
Fixed Assets
Tangible assets 25,470 38,471 32,228
25,470 38,471 32,228
Current Assets
Debtors 207,128 244,590 223,151
Cash at bank and in hand 2,046,433 1,475,711 1,511,319
2,253,561 1,720,301 1,734,470
Creditors: amounts falling due within one year (137,596) (266,045) (234,896)
Net current assets 2,115,965 1,454,256 1,499,574
Total assets less current liabilities 2,141,435 1,492,727 1,531,802
Provision for liabilities and charges (37,894) (12,416) (12,416)
Net assets 2,103,541 1,480,311 1,519,386
Capital and reserves
Called up share capital 6 88,051 80,724 83,194
Share premium account 7 5,088,345 3,006,985 3,621,427
Other reserves 1,152,165 1,152,165 1,152,165
Profit and loss account (4,225,020) (2,759,563) (3,337,400)
Equity shareholders' funds 8 2,103,541 1,480,311 1,519,386
CONSOLIDATED CASH FLOW STATEMENT
For the six months ended 31 July 2003
Unaudited Unaudited Audited
six months six months Year
ended ended ended
31 July 31 July 31 January
2003 2002 2003
# # #
Notes
Net cash outflow from operating activities 9 (1,091,880) (658,296) (1,265,974)
Returns on investments and servicing of finance
Interest received 27,284 30,081 50,888
Interest paid (362) (505) (714)
Net cash inflow/(outflow) from returns on 26,922 29,576 50,174
investments and servicing of finance
Corporation Tax
Research and development tax credit received 128,297 29,998 153,876
128,297 29,998 153,876
Capital expenditure
Payments to acquire tangible assets - (2,174) (2,776)
Net cash outflow from capital expenditure - (2,174) (2,776)
Net cash outflow before use of liquid (936,661) (600,896) (1,064,700)
resources and financing
Management of liquid resources
(Increase) / Decrease in short term deposits 10 (404,172) 541,086 483,411
Financing
Issue of ordinary shares 1,700,000 - 617,500
Expenses paid in connection with share issues (228,225) (83,634) (84,222)
Cash received pending share issue - 117,500 -
Net cash inflow from financing 1,471,775 33,866 533,278
Increase / (Decrease) in net cash 10 130,942 (25,944) (48,011)
NOTES TO THE INTERIM FINANCIAL INFORMATION
For the six months ended 31 July 2003
1. Basis of preparation
The Interim Report was approved by the Board of Directors on 19 September 2003.
The financial information contained in this Interim Report has been prepared on
the basis of the accounting policies set out in the Group's audited accounts for
the year ended 31 January 2003.
The financial information for the six months ended 31 July 2003 and for the six
months ended 31 July 2002 is unaudited.
The financial information for the Group set out above does not constitute "
statutory accounts" within the meaning of Section 240 of the Companies Act 1985.
The information for the year ended 31 January 2003 has been extracted from the
statutory accounts of Futura Medical plc for that year which received an
unqualified audit report and has been delivered to the Registrar of Companies.
2. Introduction to the Alternative Investment Market of the
London Stock Exchange
On 22 July 2003, Futura Medical plc listed by way of an Introduction to the
Alternative Investment Market of the London Stock Exchange. Exceptional costs
were incurred of #351,299 in respect of the listing and these are included with
administrative expenses contributing to the operating loss.
3. Taxation
Taxation represents tax credits for certain research and development expenditure
based on the expenditure incurred in the relevant period or year. Deferred tax
assets have not been recognised on the basis that their future economic benefit
is not certain.
4. Dividends
No dividends have been paid and none are proposed.
5. Loss per ordinary share
The calculation of the loss per ordinary share is based on a loss of #887,620
(six months to 31 July 2002: loss of #507,244; year to 31 January 2003: loss of
#1,085,081) and on a weighted average of 41,731,175 shares in issue (six months
to 31 July 2002: 40,362,000 shares; year to 31 January 2003: 40,730,808 shares).
The loss attributable to ordinary shareholders and weighted average number of
ordinary shares for the purpose of calculating the diluted earnings per ordinary
share are identical to those used for basic earnings per share. This is because
the exercise of share options would have the effect of reducing the loss per
ordinary share and is therefore not dilutive under the terms of Financial
Reporting Standard 14.
6. Share capital
On 22 July 2003 the Company issued 2,428,571 ordinary shares of 0.2 pence each
through a private placing at 70 pence each. The shares were issued at a premium
of #1,695,143.
7. Share premium
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 July 31 July 31 January
2003 2002 2003
# # #
Opening share premium 3,621,427 3,018,212 3,018,212
Premium on shares issued 1,695,143 - 615,030
Less: share issues costs (228,225) (11,227) (11,815)
Closing share premium 5,088,345 3,006,985 3,621,427
8. Reconciliation of movements in shareholders' funds
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 July 31 July 31 January
2003 2002 2003
# # #
Retained loss for the period (887,620) (507,244) (1,085,081)
Net proceeds from issue of shares 1,471,775 (11,227) 605,685
Net addition/(reduction) in shareholders' funds 584,155 (518,471) (479,396)
Opening shareholders' funds 1,519,386 1,998,782 1,998,782
Closing shareholders' funds 2,103,541 1,480,311 1,519,386
9. Reconciliation of operating profit to operating cashflows
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 July 31 July 31 January
2003 2002 2003
# # #
Operating loss (966,334) (614,325) (1,296,076)
Depreciation 6,758 6,730 13,575
Loss on sale of tangible fixed assets - 259 259
(Increase) in debtors (60,481) (22,116) (28,822)
(Decrease) / Increase in creditors (71,823) (28,844) 45,090
Net cash outflow from operating activities (1,091,880) (658,296) (1,265,974)
10. Reconciliation of net cash flow to movement in net funds
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 July 31 July 31 January
2003 2002 2003
# # #
Increase / (Decrease) in cash in the period 130,942 (25,944) (48,011)
Cash outflow / (inflow) from changes in liquid 404,172 (541,086) (483,411)
resources
Movement in net funds in the period 535,114 (567,030) (531,422)
Net funds at start of period 1,511,319 2,042,741 2,042,741
Net funds at end of period 2,046,433 1,475,711 1,511,319
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SFMFMUSDSELU