TIDMONC
RNS Number : 1107A
Oncimmune Holdings PLC
22 May 2023
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
THE COMPANY TO CONSTITUTE INSIDE INFORMATION STIPULATED UNDER THE
MARKET ABUSE REGULATION (EU) NO. 596/2014 ("MAR") AND THE RETAINED
UK LAW VERSION OF MAR PURSUANT TO THE MARKET ABUSE (AMMENT) (EU
EXIT) REGULATIONS 2019 (SI 2019/310) ("UK MAR"). UPON THE
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION
SERVICE, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE
PUBLIC DOMAIN.
FURTHER, THIS ANNOUNCEMENT IS MADE FOR INFORMATION PURPOSES ONLY
AND DOES NOT CONSTITUTE AN OFFER TO SELL OR ISSUE OR SOLICITATION
TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE SHARES IN ONCIMMUNE
HOLDINGS PLC IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL.
22 May 2023
Oncimmune Holdings plc
("Oncimmune" the "Company" or the "Group")
Sale of Oncimmune Limited to Freenome
Oncimmune Holdings plc (AIM: ONC.L), the leading global
immunodiagnostics group, today announces that it has sold its
wholly-owned subsidiaries, Oncimmune Limited (including the
CE-marked IVD EarlyCDT(R) Lung blood test, antibody platform and
research and development pipeline) and Oncimmune Europe GmbH to
Freenome Holdings, Inc. ("Freenome") for a total of GBP13M in cash
(the "Sale").
Oncimmune will continue to operate its ImmunoINSIGHTS business,
primarily through its subsidiary Oncimmune Germany GmbH.
Freenome is a US-based private biotechnology company with a
comprehensive multiomics platform for the early detection and early
intervention of cancer using a standard blood draw. This
acquisition of Oncimmune Limited will complement Freenome's
frontline screening efforts, both clinically and commercially.
Oncimmune Limited's pipeline of autoantibody targets for other
cancer indications will augment Freenome's multiomics platform with
additional non-tumor-derived signals.
Consideration and ImmunoINSIGHTS Master Service Agreement
Oncimmune has sold the entire share capital in Oncimmune Limited
and Oncimmune Europe GmbH for GBP13M in cash, structured as
consideration for equity and debt repayment, of which GBP1.3M in
cash is being held in escrow for 12 months in the event of any
claim by Freenome against the customary warranties and indemnity
given to Freenome in the sale and purchase agreement.
Separately, Oncimmune Germany GmbH, Oncimmune's wholly-owned
pharma services business trading as ImmunoINSIGHTS, and Freenome
have signed a long-term Master Services Agreement ("MSA"), under
which Freenome will leverage the ImmunoINSIGHTS discovery services
business to further accelerate Freenome's pipeline for multiple
cancers, with a guaranteed commitment by Freenome to purchase
services from Oncimmune Germany GmbH worth at least EUR1.14M per
year. The MSA has an overall term of five years, with a fixed
initial term of two years and Freenome's option to extend for a
further three years on the same terms.
Debt
Oncimmune has an existing debt facility with IPF Management SA
("IPF Partners") (the "IPF Facility") with an outstanding principal
balance of EUR11.6M prior to this Sale. In connection with the
Sale, Oncimmune has agreed to repay EUR7.2M (being EUR5.6M of
principal and EUR1.6M of interest) of the outstanding IPF Facility.
Oncimmune has today entered into a new debt facility (the "New IPF
Facility") for the outstanding EUR6.0M in principal from the
previous IPF Facility under which the principal amount is repayable
over the next three years, with a principal repayments holiday for
the first 12 months, and with interest commencing from September
2023 on the same cash margin rate as in the previous IPF Facility.
Repayments under the New IPF Facility have been profiled such that
40% (or EUR2.4M) of the EUR6.0M facility will be repaid at the end
of the agreement in March 2026.
The New IPF Facility is secured by fixed and floating charges
over the assets of Oncimmune and the shares in Oncimmune Germany
GmbH and may be repaid at any time, subject to an early repayment
fee. The interest rate is 9% per annum over 3-month EURIBOR
(subject to a floor of 0%) and is payable quarterly.
Reasons for the Sale
As announced on 27 February 2023 in the Company's audited
results for the 15-month period ended 31 August 2022, the Board has
been considering several options for the realisation of value from
non-core assets.
Since the acquisition of the ImmunoINSIGHTS business, Oncimmune
has progressively focused its corporate strategy on the development
and growth of its pharma services offering through this
business.
In July 2022, Oncimmune's EarlyCDT(R) Lung product, EarlyCDT(R)
platform and autoantibody development business, based in
Nottingham, was restructured. Having completed this restructuring,
the Board commenced a process for the potential realisation of
value from this business.
Proceeds from the Sale
Following payment of the EUR7.2M under the IPF Facility and
other costs associated with the Sale, the Company expects to have
approximately GBP6.7M in cash (which includes the GBP1.3M held in
escrow as described above). Reference was made in the audited
results for the 15-month period ended 31 August 2022 to the Group's
debt obligations giving rise to a material uncertainty. The Board
considers that the repayment of debt under the IPF Facility, the
repayment profile of the new IPF Facility, together with the net
proceeds from the Sale, removes any material uncertainty as regards
going concern.
Additional AIM Rules for Companies Disclosures
Additional disclosures in respect of the Company's obligations
under the AIM Rules for Companies in connection with the Sale are
contained at the foot of this announcement.
Dr Adam M Hill, CEO of Oncimmune said: " We are delighted to
pass the EarlyCDT(R) technology platform and pipeline of
autoantibody targets for other cancer indications to Freenome to
advance Freenome's multi-cancer early detection screening pipeline.
We have confidence that in their hands and with our teams'
expertise, the full potential of the technology will be unlocked to
the benefit of patients. Having now completed the Sale, the Group
will focus on driving profitable growth in our ImmunoINSIGHTS
pharma services business. Signing the MSA between ImmunoINSIGHTS
and Freenome also adds Freenome as a new major client alongside 7
of the top 15 global pharma companies who use the ImmunoINSIGHTS
platform."
Mike Nolan, Chief Executive Officer of Freenome said: "Oncimmune
and Freenome share a deep commitment to patients and this
acquisition is consistent with Freenome's holistic solution to
cancer detection. Oncimmune's track record of translating
innovative technologies into mainstream clinical use, now being
integrated with Freenome's platform and team, strengthens our
multiomics approach to make an even greater impact for patients
across a range of indications."
For further information:
Oncimmune Holdings plc
Dr Adam M Hill, Chief Executive Officer
Matthew Hall, Chief Financial Officer
contact@oncimmune.co.uk
Singer Capital Markets (Nominated Adviser and Broker)
Phil Davies, Harry Gooden, George Tzimas, James Fischer
+44 (0)20 7496 3000
Zeus (Joint Broker)
Dominic King, Victoria Ayton, Dan Bate
+44 (0)20 3829 5000
Freenome
Sarah Anderson
press@freenome.com
Additional disclosures relating to the Sale
Prior to the Sale, Oncimmune Limited was a 100%-owned subsidiary
of Oncimmune Holdings plc and represented the entirety of the
Company's EarlyCDT(R) business.
In the 15-month period ending 31 August 2022, Oncimmune Limited
generated revenue of GBP1.49M and loss before tax of approximately
GBP5.0M, with net liabilities of GBP31,000 as at 31 August 2022.
Oncimmune Limited is being sold on a cash free, debt-free basis.
The historical funding provided by the Company to Oncimmune
Limited, amounting to GBP24.0M, which is classified as an
intercompany loan, has now been fully written-off.
The consideration comprises the following main items:
-- GBP13M in cash on completion on a cash free, debt-free basis,
of which GBP1.3M in cash is being held in escrow for 12 months in
the event of any potential claims that could be made by Freenome
against customary warranties and indemnity given in connection with
the Sale; and
-- The signing of a Master Services Agreement between the
Group's wholly-owned subsidiary Oncimmune Germany GmbH and Freenome
under which Freenome will leverage the ImmunoINSIGHTS pharma
services business for the next two years, with a guaranteed
commitment to purchase services worth EUR1.14M each year.
Furthermore, Freenome has the option to extend the commitment under
this ImmunoINSIGHTS MSA for an additional three years subject to a
EUR1.14M annual financial commitment.
About Oncimmune
Oncimmune is a leading immunodiagnostics developer, primarily
focused on the growing fields of immuno-oncology, autoimmune
disease and infectious diseases. The ImmunoINSIGHTS service
business leverages Oncimmune's technology platform and
methodologies across multiple diseases, to offer life-science
organizations actionable insights for therapies across the
development and product lifecycle. Our core immune-profiling
technology is underpinned by our library of over eight thousand
immunogenic proteins, one of the largest of its kind. This helps
identify trial participants and patients into clinically relevant
subgroups, enabling development of targeted and more effective
treatments.
Oncimmune's ImmunoINSIGHTS service business is based at the
Company's discovery research centre in Dortmund, Germany. The
business platform enables life science organizations to optimize
drug development and delivery, leading to more effectively targeted
and safer treatments for patients.
The ImmunoINSIGHTS development team is based in the US and
Europe and Oncimmune is seeking to replicate the Dortmund facility
in the US in the medium term.
For more information, visit www.oncimmune.com
About Freenome
Freenome is a biotechnology company with a comprehensive
multiomics platform for the early detection of cancer using a
standard blood draw. The company combines its deep expertise in
molecular biology with advanced computational biology and machine
learning to detect disease-associated patterns among billions of
circulating cell-free biomarkers. Freenome is headquartered in
South San Francisco, California.
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