(“Biodexa” or the “Company”)
Biodexa Announces
Proceeds Cover Year 1 eRapa Phase 3 Obligations, Unlocking Twice that Amount in Non-dilutive Grant Funding
The Existing Warrants had initial exercise prices of
In consideration for the immediate exercise of the Existing Warrants for cash, the exercising holders will receive new unregistered warrants (the “Replacement Warrants”) to purchase an aggregate of 6,537,483 ADSs (equivalent to 2,614,993,200 Ordinary Shares) in a private placement pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”). The Replacement Warrants will have an exercise price of
The Company intends to use the net proceeds from the offering to advance its clinical stage assets and for working capital and general corporate purposes.
The Replacement Warrants described above were offered in a private placement pursuant to an applicable exemption from the registration requirements of the 1933 Act and, along with the ADSs issuable upon their exercise, have not been registered under the 1933 Act, and may not be offered or sold in
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.
Total Voting Rights
Following exercise of the Existing Warrants, the Company's issued share capital comprises 4,127,615,322 Ordinary Shares each with voting rights. The Company does not hold any shares in treasury. This figure of 4,127,615,322 may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company. Each of the Company’s American Depositary Shares comprises 400 Ordinary Shares and therefore the equivalent number of ADSs in issue is 10,319,038.
About the
CPRIT was created by the
For more information, please contact:
Tel: +44 (0)29 20480 180 www.biodexapharma.com |
About
eRapa is a proprietary oral tablet formulation of rapamycin, also known as sirolimus. Rapamycin is an mTOR (mammalian Target Of Rapamycin) inhibitor. mTOR has been shown to have a significant role in the signalling pathway that regulates cellular metabolism, growth and proliferation and is activated during tumorgenesis.
Tolimidone is an orally delivered, potent and selective activator of Lyn kinase. Lyn is a member of the Src family of protein tyrosine kinases, which is mainly expressed in hematopoietic cells, in neural tissues, liver, and adipose tissue. Tolimidone demonstrates glycemic control via insulin sensitization in animal models of diabetes and has the potential to become a first in class blood glucose modulating agent.
MTX110 is a solubilised formulation of the histone deacetylase (HDAC) inhibitor, panobinostat. This proprietary formulation enables delivery of the product via convection-enhanced delivery (CED) at chemotherapeutic doses directly to the site of the tumor, by-passing the blood-brain barrier and potentially avoiding systemic toxicity.
Biodexa is supported by three proprietary drug delivery technologies focused on improving the bio-delivery and bio-distribution of medicines. Biodexa’s headquarters and R&D facility is in
Forward-Looking Statements
Certain statements in this announcement may constitute “forward-looking statements” within the meaning of legislation in the
Reference should be made to those documents that Biodexa shall file from time to time or announcements that may be made by Biodexa in accordance with the rules and regulations promulgated by the
(“Biodexa” or the “Company”)
Interim results for the six months ended 30
OPERATIONAL HIGHLIGHTS
The Company announced the following in the six months ended
- Approval by the Data Safety Monitoring Board to escalate the dose of MTX110 in recurrent glioblastoma (rGBM) to 90µM, the expected optimal therapeutic dose.
- Closing of a private placement in the US to raise
$6.0m before expenses. - Following shareholder approval, and in line with its realigned strategy, the Company de-listed from AIM and its name was changed to
Biodexa Pharmaceuticals PLC . - Initiation of a new R&D programme, MTD217, combining MTX110 with an oxidative phosphorylation inhibitor targeted at leptomeningeal carcinomatosis.
- Closing of a registered direct offering and private placement in the US to raise
$3.3m before expenses.
Post period end:
- Completion of enrolment of nine patients in a Phase I study of MTX110 in diffuse midline glioma (DMG), formerly known as diffuse intrinsic pontine glioma (DIPG).
FINANCIAL HIGHLIGHTS
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For more information, please contact:
Tel: +44 (0)29 2048 0180 |
www.biodexapharma.com |
Tel: +1 (860) 573 9637 Email: afactor@edisongroup.com |
About MTX110 is a liquid formulation of the histone deacetylase (HDAC) inhibitor, panobinostat. This proprietary formulation enables delivery of the product via convection-enhanced delivery (CED) at potentially chemotherapeutic doses directly to the site of the tumour, by-passing the blood-brain barrier and avoiding systemic toxicity. Biodexa's headquarters and R&D facility is in Forward-Looking Statements Certain statements in this announcement are forward-looking statements or information (collectively, forward-looking statements). Biodexa hereby provides cautionary statements identifying important factors that could cause the actual results to differ materially from those projected in the forward-looking statements. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases such as “may”, “is expected to”, “anticipates”, “estimates”, “intends”, “plans”, “projection”, “could”, “vision”, “goals”, “objective” and “outlook”) are not historical facts and may be forward-looking and may involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. By their nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, which contribute to the possibility that the predicted outcomes may not occur or may be delayed. The risks, uncertainties and other factors many of which are beyond the control of Biodexa, that could influence actual results include, but are not limited to: a limited operating history; regulatory risks; substantial capital and liquidity requirements; financing risks and dilution to shareholders; competition; reliance on management and dependence on key personnel; conflicts of interest of management; exposure to potential litigation, and other factors beyond the control of Biodexa. Forward looking statements are based on estimates and assumptions made by management in light of their experience of historical trends, current conditions and expected future developments, as well as factors that are believed to be appropriate. Such factors include, among others, Biodexa’s future product revenues, stage of development, additional capital requirements, risks associated with the completion and timing of clinical trials and obtaining regulatory approval to market Biodexa’s products, the ability to protect its intellectual property, dependence upon collaborative partners, changes in government regulation or regulatory approval processes and rapid technological change in the industry. These factors should be considered carefully and readers are cautioned to not place undue reliance on such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by applicable law, Biodexa undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statements are made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all such factors and to assess in advance the impact of each such factor on the business of the Company or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data. You should, however, review the factors and risks we describe in the reports we will file from time to time with the |
CHIEF EXECUTIVE’S REVIEW
Our primary focus in the first half of 2023 was on re-financing the Company before our cash runway was due to expire at the end of the first quarter of 2023 and then, having secured the immediate future, executing on our realigned strategy.
Realigned strategy
In the course of seeking finance for the Company in late 2022 it became clear to us that a company developing therapeutics was more investable than a drug delivery platform company. Accordingly, the Board determined that the Company should be repositioned as a therapeutics company, based around its MTX110 clinical asset, supported by its three enabling technologies, Q-Spera™, MidaSolve™ and MidaCore™.
Going forward, our strategy is to move our development programmes into the clinic and add value by generating clinical data to demonstrate proof-of-concept before seeking partners.
Strategic acquisitions
With a single clinical asset, MTX110 being developed for three types of rare brain cancers, the Board has looked for opportunities to broaden the Company’s R&D pipeline through acquisitions of companies or licensing of assets with a focus on rare diseases and/or oncology. In
R&D update
MTX110
MTX110, a novel formulation of panobinostat administered through convection enhanced delivery (CED), is in clinical development for intractable brain cancers including recurrent glioblastoma (rGBM), diffuse midline glioma (DMG) and medulloblastoma.
MTX110 employs our MidaSolve technology to solubilize panobinostat, a histone deacetylase (HDAC) inhibitor, so that it can be delivered directly to a patient’s brain tumour via an onboard pump and catheter (or CED) system. Our Phase I study of MTX110 in rGBM is ongoing at two clinical centres:
In
A Phase I study of MTX110 in medulloblastoma remains ongoing at the
Q-Sphera
The Company’s drug delivery technologies have been de-prioritised. We intend to continue our existing, and seek new, collaborations for our technology but we will not be expanding our internal Q-Sphera pipeline.
Q-octreotide and Q-brexpiprazole remain available for potential licensing.
MTD217
In
Financing
Following the termination of the Bioasis acquisition and related financing, we were successful in raising
We utilised our capacity under our Registration Statement on Form F-3 to raise
*The above ADS numbers reflect the ADS ratio change effected on
1H23 FINANCIAL REVIEW
The unaudited results for the six months ended
Key performance indicators (KPIs):
1H 2023 | 1H 2022 | Change | |
Total gross revenue(1) | £0.30m | £0.47m | (36)% |
R&D costs | £2.25m | £2.41m | (7)% |
R&D as % of operating costs | 50% | 57% | n/a |
Net cash inflow/(outflow) for the period | £2.39m | £(3.63)m | n/m |
(1) Total revenue represents income from R&D collaborations. |
Biodexa’s KPIs focus on the key areas of operating results, R&D spend and cash management. These measures provide information on the core R&D operations. Additional financial and non-financial KPIs may be adopted in due course.
Revenues
Total revenue for the six months to
Research and Development
R&D costs in 1H23 reduced by £0.16m, or 7%, to £2.25m compared with £2.41m in 1H22. The percentage of R&D costs as a percentage of operating costs reduced in the period to 50% from 57%. The reduction in R&D costs in 1H23 reflects the decision made by the Directors to reposition as a therapeutics company and to not expand our internal drug delivery platform. The resulting cost-reduction program in
Administrative Costs
Administrative expenses in 1H23 increased by 24% to £2.29m from £1.85m in 1H22. The increase in administrative costs in 1H23 is a result of the Company expensing legal and professional fees of £0.40m in connection with the successful financing transactions and aborted acquisitions.
Finance Income and Expense
Finance income in 1H23 and 1H22 included gains in respect of an equity settled derivative financial liability of £0.39m (1H22: £0.40m). The gain arose as a result of the fall in the Biodexa share price. In addition, the Company earned interest on cash deposits.
Finance expense in the period related to lease liabilities.
Cash Flows
Cash outflows from operating activities in 1H23 were £3.88m compared to £3.54m in 1H22, driven by a net loss of £3.57m (1H22: £3.06m) and after positive working capital of £0.21m (1H22: negative £0.05m) and other negative non-cash items totalling £0.52m (1H22: negative £0.43m).
Net cash generated in investing activities in 1H23 of £0.02m (1H22: outflow £0.02m) includes interest received on cash deposits of £0.02m.
Net cash generated in financing activities in 1H23 was £6.25m (1H22: outflow £0.08m), which was driven by receipt of funds from share issuances, including the exercise of pre-funded warrants, of £6.35m. This was offset by payments on lease liabilities of £0.10m.
Overall, cash increased by £2.39m in 1H23 compared to a decrease of £3.63m in 1H22. This resulted in a cash balance at
Post-period end
On
Going concern
Biodexa has experienced net losses and significant cash outflows from cash used in operating activities over the past years as it develops its portfolio. For the six months to
The Group’s future viability is dependent on its ability to raise cash from financing activities to finance its development plans until commercialisation, generate cash from operating activities and to successfully obtain regulatory approval to allow marketing of its development products. The Group’s failure to raise capital as and when needed could have a negative impact on its financial condition and ability to pursue its business strategies.
The Group's consolidated financial statements have been presented on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.
As at
The Directors have prepared cash flow forecasts and considered the cash flow requirement for the Group for the next three years including the period 12 months from the date of approval of this interim financial information. These forecasts show that further financing will be required before the first quarter of 2024 assuming, inter alia, that certain development programs and other operating activities continue as currently planned. If we raise additional funds through the issuance of debt securities or additional equity securities, it could result in dilution to our existing shareholders, increased fixed payment obligations and these securities may have rights senior to those of our ordinary shares (including the ADSs) and could contain covenants that would restrict our operations and potentially impair our competitiveness, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business. Any of these events could significantly harm our business, financial condition and prospects.
In the Directors’ opinion, the environment for financing of small and micro-cap biotech companies continues to be challenging. While this may present acquisition and/or merger opportunities with other companies with limited or no access to financing, as noted above, any attendant financings by Biodexa are likely to be dilutive. The Directors continue to evaluate financing options, including those connected to acquisitions and/or mergers, potentially available to the Group. Any alternatives considered are contingent upon the agreement of counterparties and accordingly, there can be no assurance that any of alternative courses of action to finance the Company would be successful. This requirement for additional financing in the short term represents a material uncertainty that may cast significant doubt upon the Group and Parent Company’s ability to continue as a going concern. Should it become evident in the future that there are no realistic financing options available to the Company which are actionable before its cash resources run out then the Company will no longer be a going concern. In such circumstances, we would no longer be able to prepare financial statements under paragraph 25 of IAS 1. Instead, the financial statements would be prepared on a liquidation basis and assets would stated at net realizable value and all liabilities would be accelerated to current liabilities.
The Directors believe there are adequate options and time available to secure additional financing for the Company and after considering the uncertainties, the Directors consider it is appropriate to continue to adopt the going concern basis in preparing these financial statements.
Our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement and involves risks and uncertainties, and actual results could vary as a result of a number of factors, including the timing of clinical trials. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect. If we lack sufficient capital to expand our operations or otherwise capitalize on our business opportunities, our business, financial condition and results of operations could be materially adversely affected.
Chief Executive Officer and Chief Financial Officer
Consolidated Statements of Comprehensive Income
For the year six month period ended 30 June
Note | 2023 unaudited £’000 | 2022 unaudited £’000 | |
Revenue | 298 | 468 | |
Other income | - | 16 | |
Research and development costs | (2,251) | (2,413) | |
Administrative costs | (2,291) | (1,849) | |
Loss from operations | (4,244) | (3,778) | |
Finance income | 2 | 410 | 404 |
Finance expense | 2 | (22) | (24) |
Loss before tax | (3,856) | (3,398) | |
Taxation | 3 | 288 | 337 |
Loss) for the period attributable to the owners of the parent | (3,568) | (3,061) | |
Other comprehensive income: | |||
Items that will or may be reclassified subsequently to profit or loss: | |||
Total other comprehensive gain net of tax | - | - | |
Total comprehensive loss attributable to the owners of the parent | (3,568) | (3,061) | |
Loss per share | |||
Basic and diluted loss per ordinary share – pence | 4 | (4)p | (62)p |
The accompanying notes form part of these financial statements
Distribution costs, sales and marketing are immaterial in 2023 and 2022 and have been included within administrative costs.
Consolidated Statements of Financial Position
Note | As at 30 £’000 | As at £’000 | ||
Assets | ||||
Non-current assets | ||||
Property, plant and equipment | 693 | 831 | ||
Intangible assets | 5 | 6 | ||
698 | 837 | |||
Current assets | ||||
Trade and other receivables | 903 | 1,006 | ||
Taxation | 1,134 | 846 | ||
Cash and cash equivalents | 5,227 | 2,836 | ||
7,264 | 4,688 | |||
Total assets | 7,962 | 5,525 | ||
Liabilities | ||||
Non-current liabilities | ||||
Borrowings | 5 | 380 | 463 | |
380 | 463 | |||
Current liabilities | ||||
Trade and other payables | 1,755 | 1,447 | ||
Borrowings | 5 | 164 | 161 | |
Provisions | 6 | - | 207 | |
Derivative financial liability | 7 | 364 | 85 | |
2,283 | 1,900 | |||
Total liabilities | 2,663 | 2,363 | ||
Issued capital and reserves attributable to owners of the parent | ||||
Share capital | 8 | 5,341 | 1,108 | |
Share premium | 84,653 | 83,667 | ||
Merger reserve | 53,003 | 53,003 | ||
Warrant reserve | 1,275 | 720 | ||
Accumulated deficit | (138,973) | (135,336) | ||
Total equity | 5,299 | 3,162 | ||
Total equity and liabilities | 7,962 | 5,525 |
The accompanying notes form part of these financial statements
Consolidated Statements of Cash Flows
For the six month period ended 30 June
Note | 2023 unaudited £’000 | 2022 unaudited £’000 | |
Cash flows from operating activities | |||
Loss for the period | (3,568) | (3,061) | |
Adjustments for: | |||
Depreciation of property, plant and equipment | 72 | 96 | |
Depreciation of right of use asset | 70 | 86 | |
Amortisation of intangible fixed asset | 1 | - | |
Loss on disposal of fixed assets | - | 2 | |
Finance income | 2 | (410) | (404) |
Finance expense | 2 | 22 | 24 |
Share-based payment expense | 15 | 100 | |
Taxation | 3 | (288) | (337) |
Cash flows from operating activities before changes in working capital | (4,086) | (3,494) | |
Decrease/(increase) in trade and other receivables | 103 | (224) | |
Increase in trade and other payables | 309 | 187 | |
Decrease in provisions | (207) | (8) | |
Cash used in operations | (3,881) | (3,539) | |
Taxes payments | - | - | |
Net cash used in operating activities | (3,881) | (3,539) |
Consolidated Statements of Cash Flows (continued)
For the six month period ended 30 June
Note | 2023 unaudited £’000 | 2022 unaudited £’000 | |
Investing activities | |||
Purchases of property, plant and equipment | (4) | (33) | |
Proceeds from disposal of fixed assets | - | 9 | |
Interest received | 24 | 7 | |
Net cash generated from/(used in) investing activities | 20 | (17) | |
Financing activities | |||
Interest paid | (7) | (5) | |
Amounts paid on lease liabilities | (95) | (73) | |
Share issues including warrants, net of costs | 8 | 6,354 | - |
Net cash generated from/(used in) financing activities | 6,252 | (78) | |
Net increase/(decrease) in cash and cash equivalents | 2,391 | (3,634) | |
Cash and cash equivalents at beginning of period | 2,836 | 10,057 | |
Exchange (losses)/gains on cash and cash equivalents | - | - | |
Cash and cash equivalents at end of period | 5,227 | 6,423 |
The accompanying notes form part of these financial statements
Consolidated Statements of Changes in Equity (unaudited)
Note | Share capital £’000 | Share premium £’000 | Merger reserve £’000 | Warrant reserve £’000 | Accumulated deficit £’000 | Total equity £’000 | |
At | 1,108 | 83,667 | 53,003 | 720 | (135,336) | 3,162 | |
Loss for the period | - | - | - | - | (3,568) | (3,568) | |
Total comprehensive loss | - | - | - | - | (3,568) | (3,568) | |
Transactions with owners: | |||||||
Shares issued on | 65 | 99 | - | 4,803 | - | 4,967 | |
Costs associated with share issue on | - | (29) | - | (874) | - | (903) | |
Shares issued on | 2,214 | (1,404) | - | 1,214 | - | 2,024 | |
Costs associated with share issue on | - | - | - | (317) | (210) | (527) | |
Exercise of pre-funded warrants during period | 1,244 | 1,024 | - | (2,266) | - | 2 | |
Exercise of warrants during period | 710 | 1,296 | - | (2,005) | - | 1 | |
Share-based payment charge | - | - | - | - | 141 | 141 | |
Total contribution by and distributions to owners | 4,233 | 986 | - | 555 | (69) | 5,705 | |
At | 5,341 | 84,653 | 53,003 | 1,275 | (138,973) | 5,299 | |
Note | Share capital £’000 | Share premium £’000 | Merger reserve £’000 | Warrant reserve £’000 | Accumulated deficit £’000 | Total equity £’000 | |
At | 1,098 | 83,434 | 53,003 | 720 | (127,803) | 10,452 | |
Loss for the period | - | - | - | - | (3,061) | (3,061) | |
Total comprehensive loss | - | - | - | - | (3,061) | (3,061) | |
Transactions with owners: | |||||||
Exercise of warrants on | - | - | - | - | - | - | |
Shares issued on | - | - | - | - | - | ||
Share-based payment charge | - | - | - | - | 100 | 100 | |
Total contribution by and distributions to owners | - | - | - | 100 | 100 | ||
At | 1,098 | 83,434 | 53,003 | 720 | (130,764) | 7,491 |
The accompanying notes form part of these financial statements
Notes Forming Part of The Consolidated Unaudited Interim Financial Information
For the six month period ended 30
1. Basis of preparation
The unaudited interim consolidated financial information for the six months ended
The condensed interim financial information contained in this interim statement does not constitute statutory financial statements as defined by section 434(3) of the Companies Act 2006. The condensed interim financial information has not been audited. The comparative financial information for the six months ended
Biodexa Pharmaceutical’s annual reports may be downloaded from the Company’s website at https://biodexapharma.com/investors/financial-reports-and-presentations/#financial-reportsor a copy may be obtained from
Going Concern
Biodexa has experienced net losses and significant cash outflows from cash used in operating activities over the past years as it develops its portfolio. For the six months to
The Group’s future viability is dependent on its ability to raise cash from financing activities to finance its development plans until commercialisation, generate cash from operating activities and to successfully obtain regulatory approval to allow marketing of its development products. The Group’s failure to raise capital as and when needed could have a negative impact on its financial condition and ability to pursue its business strategies.
The Group's consolidated financial statements have been presented on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.
As at
The Directors have prepared cash flow forecasts and considered the cash flow requirement for the Group for the next three years including the period 12 months from the date of approval of this interim financial information. These forecasts show that further financing will be required before the first quarter of 2024 assuming, inter alia, that certain development programs and other operating activities continue as currently planned. If we raise additional funds through the issuance of debt securities or additional equity securities, it could result in dilution to our existing shareholders, increased fixed payment obligations and these securities may have rights senior to those of our ordinary shares (including the ADSs) and could contain covenants that would restrict our operations and potentially impair our competitiveness, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business. Any of these events could significantly harm our business, financial condition and prospects.
In the Directors’ opinion, the environment for financing of small and micro-cap biotech companies is as challenging as it has been since the financial crisis of 2008-10. While this may present acquisition and/or merger opportunities with other companies with limited or no access to financing, as noted above, any attendant financings by Biodexa are likely to be dilutive. The Directors continue to evaluate financing options, including those connected to acquisitions and/or mergers, potentially available to the Group. Any alternatives considered are contingent upon the agreement of counterparties and accordingly, there can be no assurance that any alternative courses of action to finance the Company would be successful. This requirement for additional financing in the short term represents a material uncertainty that may cast significant doubt upon the Group and Parent Company’s ability to continue as a going concern. Should it become evident in the future that there are no realistic financing options available to the Company which are actionable before its cash resources run out then the Company will no longer be a going concern. In such circumstances, we would no longer be able to prepare financial statements under paragraph 25 of IAS 1. Instead, the financial statements would be prepared on a liquidation basis and assets would stated at net realizable value and all liabilities would be accelerated to current liabilities.
The Directors believe there are adequate options and time available to secure additional financing for the Company and after considering the uncertainties, the Directors consider it is appropriate to continue to adopt the going concern basis in preparing these financial statements.
Our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement and involves risks and uncertainties, and actual results could vary as a result of a number of factors, including the timing of clinical trials. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect. If we lack sufficient capital to expand our operations or otherwise capitalize on our business opportunities, our business, financial condition and results of operations could be materially adversely affected.
2. Finance income and expense
Six months ended 30 unaudited £’000 | Six months ended unaudited £’000 | |
Finance income | ||
Interest received on bank deposits | 24 | 6 |
Gain on equity settled derivative financial liability | 386 | 398 |
Total finance income | 410 | 404 |
The gain on the equity settled derivative financial liability in 1H23 and 1H22 arose as a result of the fall in the Biodexa share price.
Six months ended 30 unaudited £’000 | Six months ended unaudited £’000 | |
Finance expense | ||
Interest expense on lease liabilities | 15 | 24 |
Other loans | 7 | - |
Total finance expense | 22 | 24 |
3. Taxation
Income tax is recognised or provided at amounts expected to be recovered or to be paid using the tax rates and tax laws that have been enacted or substantively enacted at the Group Statement of Financial Position date. Research and development tax credits are recognised on an accruals basis and are included as an income tax credit under current assets. The research and development tax credit recognised is based on management’s estimate of the expected tax claim for the period and is recorded within taxation under the Small and Medium-sized Enterprise Scheme.
Six months ended 30 unaudited £’000 | Six months ended unaudited £’000 | |
Income tax credit | 288 | 337 |
4. Loss per share
Basic loss per share amounts are calculated by dividing the net loss for the period from continuing operations, attributable to ordinary equity holders of the parent company, by the weighted average number of ordinary shares outstanding during the period. As the Group made a loss for the period the diluted loss per share is equal to the basic loss per share.
Six months ended 30 unaudited £’000 | Six months ended unaudited £’000 | |
Numerator | ||
Loss used in basic EPS and diluted EPS: | (3,568) | (3,061) |
Denominator | ||
Weighted average number of ordinary shares used in basic EPS | 99,191,082 | 4,923,828 |
Basic and diluted loss per share: | (4)p | (62)p |
At a General Meeting on
At a General Meeting on
On
In addition, in connection with the February Private Placement the Company entered into a Waiver to the Securities Purchase Agreement (‘SPA’), dated
The Series A and Series B warrants are exercisable on an ‘alternative cashless basis’ effectively allowing the holders to exercise for nil consideration.
All resolutions were passed at the General Meeting on
On
The Series C warrants are exercisable on an ‘alternative cashless basis’ effectively allowing the holders to exercise for nil consideration.
All resolutions were passed at the General Meeting on
The Company has considered the guidance set out in IAS 33 in calculating the denominator in connection with the issuance of Series A, Series B, Series C, Pre-funded and Investor warrants. Management have recognised the warrants from the date of grant rather than the date of issue of the corresponding Ordinary Shares when calculating the denominator.
The Group has made a loss in the current and previous periods presented, and therefore the options and warrants are anti-dilutive. As a result, diluted earnings per share is presented on the same basis as basic earning per share.
*The above ADS numbers reflect the ADS ratio change effected on
5. Borrowings
As at 30 £’000 | As at 31 £’000 | |
Current | ||
Lease liabilities | 164 | 161 |
Total | 164 | 161 |
Non-current | ||
Lease liabilities | 380 | 463 |
Total | 380 | 463 |
Book values approximate to fair value at
Obligations under finance leases are secured by a fixed charge over the fixed assets to which they relate. During the period the finance lease was satisfied.
6. Provision
As at 30 £’000 | As at 31 £’000 | |
Opening provision at 1 January | 207 | 50 |
Utilisation of provision | (207) | (43) |
Provision recognised during the period | - | 200 |
- | 207 |
On
The Company advanced
Management considers recovery of the debt to be uncertain and in 2022 recognised an impairment provision of £207,000 against the advance made in
On
In 2023 the provision was utilised against the advance made to Bioasis in
7. Derivative financial liability – current
As at £’000 | As at £’000 | |
At 1 January | 85 | 553 |
Warrants issued | 665 | - |
Gain recognised in finance income within the consolidated statement of comprehensive income | (386) | (468) |
364 | 85 |
Equity settled derivative financial liability is a liability that is not to be settled for cash.
During the period the following warrants were exercised:
No warrants recognised as equity settled derivatives were exercised in 2023 or 2022.
The Company issues warrants in the ADSs of the Company as part of registered direct offerings and private placements in the US. The number of ADSs to be issued when exercised is fixed, however the exercise price is denominated in US Dollars being different to the functional currency of the Company. Therefore, the warrants are classified as equity settled derivative financial liabilities recognised at fair value through the profit and loss account (‘FVTPL’). The financial liability is valued using the Black-Scholes model in 2023, in previous periods the
Details of the warrants are as follows:
The below ADS numbers reflect the ADS ratio change effected on
In
In
In
On
ADS Warrants Number* | Original price per ADS* | New price per ADS | Equivalent Ordinary Shares (400 ordinary shares per ADS) Number | |
375 | 150,000 | |||
406 | 162,400 |
*Number and original price of warrants have been adjusted to reflect the share consolidation and ratio change of ADS’s to ordinary shares that occurred on
DARA warrants and share options
The Group also assumed fully vested warrants and share options on the acquisition of
The following table details the outstanding warrants and options recognised as equity settled derivative financial liabilities as at
At | Lapsed | At | Granted | Lapsed | Exercised | At | |
ADSs | |||||||
– | – | – | 276,689 | – | – | 276,689 | |
838 | – | 838 | – | – | – | 838 | |
392 | – | 392 | – | – | – | 392 | |
Ordinary Shares | |||||||
DARA Warrants | 204 | (204) | – | – | – | – | – |
DARA Options | 138 | – | 138 | (4) | – | 134 |
Fair value hierarchy
The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:
Level 1: quoted (unadjusted) prices in active markets for identical assets and liabilities;
Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly; and
Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.
The fair value of the Group’s derivative financial liability is measured at fair value on a recurring basis. The following table gives information about how the fair value of this financial liability is determined.
Financial liabilities | Fair value as at 30 June 2023 | Fair value as at 31 December 2022 | Fair value hierarchy | Valuation technique(s) and key input(s) | Significant unobservable input(s) | Relationship of unobservable inputs to fair value | |
Equity settled financial derivative liability – | £364,000 | - | Level 3 | 2023 - Black-Scholes Model | Volatility rate of 90% determined using historical volatility of comparable companies. | The higher the volatility the higher the fair value. | |
Expected life of 4.98 years determined using the remaining life of the share options. | The shorter the expected life the lower the fair value. | ||||||
Risk-free rate of 4.13% determined using the expected life assumptions. | The higher the risk-free rate the higher the fair value. | ||||||
Equity settled financial derivative liability – | – | £48,000 | Level 3 | 2023 – Black- Scholes Model 2022 - Monte Carlo simulation model | Volatility rate of 90% determined using historical volatility of comparable companies. | The higher the volatility the higher the fair value. | |
Expected life between a range of 0.1 and 2.38 years determined using the remaining life of the share options. | The shorter the expected life the lower the fair value. | ||||||
Risk-free rate of 4.68% determined using the expected life assumptions. | The higher the risk-free rate the higher the fair value. | ||||||
Equity settled financial derivative liability – | – | £37,000 | Level 3 | 2023 – Black- Scholes Model 2022 - Monte Carlo simulation model | Volatility rate of 90% determined using historical volatility of comparable companies. | The higher the volatility the higher the fair value. | |
Expected life between a range of 0.1 and 2.00 years determined using the remaining life of the share options. | The shorter the expected life the lower the fair value. | ||||||
Risk-free rate of 4.87% determined using the expected life assumptions. | The higher the risk-free rate the higher the fair value. | ||||||
Total | £364,000 | £85,000 |
Changing the unobservable risk-free rate input to the valuation model by 10% higher while all other variables were held constant, would not impact the carrying amount of shares (2022: nil).
There were no transfers between Level 1 and 2 in the period.
The financial liability measured at fair value on Level 3 fair value measurement represents consideration relating to warrants issued in
8. Share capital and reserves
Authorised, allotted and fully paid – classified as equity | As at 30 Number | As at 30 £ | As at Number | As at £ |
Ordinary shares of £0.001 each | 277,971,722 | 277,972 | 5,417,137 | 108,343 |
‘A’ Deferred shares of £1 each | 1,000,001 | 1,000,001 | 1,000,001 | 1,000,001 |
‘B’ Deferred shares of £0.001 | 4,063,321,418 | 4,063,321 | – | – |
Total | 5,341,294 | 1,108,344 |
At a General Meeting on
At a General Meeting on
On
During the period the Company entered into two private placements as set out in note 4. The pre-funded, Series A, Series B, Series C and Investor warrants have been accounted for as equity warrants and the fair value on recognition allocated to the warrant reserve, net of transaction costs. On exercise of the warrants the fair value has been transferred to share capital and share premium.
Ordinary and deferred shares were recorded as equity.
Rights attaching to the shares of
Shares classified as equity
The holders of ordinary shares in the capital of the Company have the following rights:
(a) to receive notice of, to attend and to vote at all general meetings of the Company, in which case shareholders shall have one vote for each share of which he is the holder; and,
(b) to receive such dividend as is declared by the Board on each share held.
The holders of deferred shares in the capital of the Company:
(a) shall not be entitled to receive notice of or to attend or speak at any general meeting of the Company or to vote on any resolution to be proposed at any general meeting of the Company; and
(b) shall not be entitled to receive any dividend or other distribution of out of the profits of the Company.
In the event of a distribution of assets, the deferred shareholders shall receive the nominal amount paid up on such share after the holder of each ordinary share shall have received (in cash or specie) the amount paid up or credited as paid up on such ordinary share together with an additional payment of £100 per share. The Company has the authority to purchase the deferred shares and may require the holder of the deferred shares to sell them for a price not exceeding 1p for all the deferred shares.
2023 | Ordinary Shares Number | ‘A’ Deferred Shares Number | ‘B’ Deferred Shares Number | Share Price £ | Total consideration £’000 | ||
At | 5,417,137 | 1,000,001 | - | ||||
Private Placements | 3,250,200 | - | - | 0.0505 | 164 | ||
Registered Direct Offering | 110,679,610 | - | - | 0.0097 | 1,076 | ||
April – | Exercise | 62,184,525 | - | - | 0.0505 | 3,139 | |
Exercise Series ‘A’ warrants | 12,931,020 | - | - | 0.0505 | 653 | ||
Exercise Series ‘B’ warrants | 19,396,530 | - | - | 0.0505 | 979 | ||
Exercise Investor warrants | 625,000 | - | - | 0.0505 | 32 | ||
Share sub-division and re-designation | - | - | 4,063,321,418 | n/a | n/a | ||
Exercise ‘C’ warrants | 63,487,700 | - | - | 0.0097 | 617 | ||
At 30 | 277,971,722 | 1,000,001 | 4,063,321,418 | ||||
2022 | |||||||
At | 4,923,420 | 1,000,001 | - | ||||
Exercise of warrants | 1 | - | - | 200.000 | - | ||
Share issue to SIPP trustee* | 1,250 | - | - | 0.001 | - | ||
Registered Direct Offering | 492,466 | - | - | 0.6660 | 321 | ||
At | 5,417,137 | 1,000,001 | - |
*Share issued to
9. Related party transaction
The Directors consider there to be no related party transactions during the periods reported other than Directors Remuneration.
10. Contingent liabilities
The Company entered into an Arrangement Agreement with Bioasis on
On
11. Events after the reporting date
On
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