hVIVO plc Trading Update (1248E)
02 November 2015 - 6:01PM
UK Regulatory
TIDMHVO
RNS Number : 1248E
hVIVO plc
02 November 2015
For immediate release 7.01am: 2 November 2015
HVIVO PLC
("hVIVO" or the "Company")
Trading Update
hVIVO plc (AIM: HVO), the pioneer of human challenge models of
disease, announces a trading update.
As noted in the Company's earlier announcement of today, hVIVO
has invested in PrEP Biopharm Limited ("PrEP") to continue the
development of the prophylactic compound, PrEP-001, following the
successful completion of a proof of concept study in the hVIVO
platform in 2013-14. Under the terms of the transaction, hVIVO is
acquiring equity in PrEP for GBP14.0 million cash consideration and
PrEP is contracting with hVIVO Services Limited to conduct a
GBP10.0 million Phase IIa clinical programme of work in 2015 and
2016. hVIVO's investment will be accounted for as an investment in
associate in its balance sheet and, in the application of the
equity method as an associate, the GBP10.0 million Phase IIa
clinical programme of work will be recognised as revenue.
hVIVO commenced the Phase IIa work in September 2015 and the
programme will be significantly progressed by the 2015 year end. As
a consequence of this work now being a part of a licence
arrangement, the Company has been advised that, due to accounting
technicalities of IFRS, the revenue and costs attributable to this
work will most likely have to be accounted for on a "completed"
basis in 2016, rather than on a "work done" basis as is currently
the case for the revenue recognition of hVIVO's standard clinical
trials agreements with clients. The Phase IIa clinical programme of
work for PrEP is forecasted to complete during 2016 and revenue of
GBP10.0 million recognised in full by the 2016 year end.
Although this has no impact on the Company's cash flows nor
impacts the total revenue recognition of GBP10.0 million for the
PrEP programme, it does have the consequence that the Company now
expects that revenue for the year ending 31 December 2015 will be
not less than GBP8.0 million. Gross profit margin is expected to be
at least 29.5%. The Company's cash balance is forecasted to be more
than GBP27.0 million as at 31 December 2015.
Kym Denny, Chief Executive Officer, comments, "In making the
transition from service provider to vested owner, it is unfortunate
that the accounting technicalities are such that we may not be able
to recognise revenue in 2015 for the great work being conducted on
this product in 2015. Ultimately this has no net effect, including
to cash flow, other than the timing difference of revenue moving
out of 2015 and into 2016. Looking forwards, hVIVO remains
committed to our strategy to build shareholder value by advancing
our remarkable R&D discoveries and by creating opportunities
like PrEP where hVIVO shares in the substantial upside of the
products that our platform helps to develop."
For further information please contact:
hVIVO plc +44 207 756 1300
Kym Denny (Chief Executive Officer)
Graham Yeatman (Chief Financial & Business Officer)
Media Enquiries +44 203 021 3933 / +44 7854 979 420
Colin Paterson (Director of Marketing, Communication and Public
Relations)
Numis Securities Limited +44 207 260 1000
Michael Meade / Freddie Barnfield (Nominated Adviser)
James Black / Michael Burke (Corporate Broking)
Notes to Editors:
hVIVO is a life sciences company pioneering a technology
platform of human disease models to accelerate drug discovery and
development in respiratory and infectious diseases.
Through its illumination of the entire disease life cycle from
healthy to sick and back to health, the hVIVO platform captures
disease in motion and promotes rational selection of drug targets
and biomarkers in respiratory and infectious diseases, such as flu
and colds. It brings together a revolutionary set of capabilities
in product validation testing and the mining of biological
insights, in order to tackle the long timeline, significant costs
and high risks to market facing drug development and diagnostic
organisations today.
A market leader in human disease models and challenge studies,
hVIVO has commercialised four disease models, successfully enrolled
over 2,000 subjects and conducted over 40 product validation
studies for a wide range of industry, government and academia
clients and collaborators.
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTFSDESFFISESF
(END) Dow Jones Newswires
November 02, 2015 02:01 ET (07:01 GMT)
Hvivo (LSE:HVO)
Historical Stock Chart
From Jun 2024 to Jul 2024
Hvivo (LSE:HVO)
Historical Stock Chart
From Jul 2023 to Jul 2024