Annual Report & Accounts 2019
12 Financial review
17 Risk management
Governance
Financial Statements
40 Independent auditor's report
45 Consolidated statement of comprehensive income
46 Consolidated statement of financial position
47 Consolidated statement of cash flows
48 Consolidated statement of changes in equity
49 Notes forming part of the financial statements
97 Company balance sheet
98 Company statement of changes in equity
99 Notes forming part of the Company financial statements
108 Company informationTo find out the latest information, please visit our website
www.midatechpharma.com
Financial highlights | |
Cash and deposits at 31 December 2019 | |
22 | Board of Directors |
24 | Chairman's introduction to |
Corporate Governance | £10.9m |
28 | Audit committee report |
31 | Directors' remuneration report |
38 | Directors' report |
• Total gross revenue(1) for the year of £0.7m (2018: £1.9m, 2017: £1.0m).
• Statutory revenue(2) for 2019 of £0.3m (2018: £0.1m, 2017: £0.1m).
• Subscription, Placing and Open Offer in February 2019 raised £12.3m (net) and Registered Direct Offering in the US in October 2019 raised $2.5m (£1.8m) (net).
• Receipt of €3.6m (£3.1m) net non-dilutive Reindus loan and award of Guazatu loan of €1.5m.
• Provisional award of a GlioKIDS grant of €2.7m (£2.3m), subject to confirmation of Midatech's status as an SME, to support a Phase II trial of MTX110.
• Cash and deposits at 31 December 2019 of £10.9m (2018: £2.3m, 2017: £13.2m).
• Net loss from continuing operations of £9.1m (2018: £10.4m loss, 2017: £11.7m loss) with net cash inflow in the year of £8.4m (2018: £10.9m outflow, 2017: £4.1m outflow).
• Tax credit receivable of £1.8m (2018: £2.0m, 2017: £1.2m).
(1) Total gross revenue represents collaboration income from continuing operations plus grant revenue.
(2) Statutory Revenue represents total gross revenue, excluding grant revenue.
Midatech Pharma plc
Annual Report & Accounts 2019
Operational highlights
• First substantive licensing agreement with China Medical System Holdings Ltd ("CMS") for the Group's pipeline products for Greater China accompanied by an £8.0m strategic investment in the Company, as part of a Subscription, Placing and Open Offer executed in February 2019.
Post period end highlights
• In January 2020, a study of subcutaneous administration of MTD201 compared with traditional intramuscular administration in healthy volunteers showed similar pharmacokinetics and bioavailability, offering the potential for a differentiated, more patient-friendly product profile.
• In March 2020, an exploratory study was initiated by Columbia University in five patients with DIPG using an alternative convection enhanced delivery system.
• Also in March 2020, following a General Meeting, the Company's ordinary shares of £0.00005 each were consolidated on a one-for-20 basis into ordinary shares of £0.001 each. At the same meeting a resolution was passed to change the ratio of the Company's American Depositary Receipts ("ADRs"). This will change from one ADR representing 20 Existing Ordinary Shares to one ADR representing five new ordinary shares.
• On 31 March 2020, the Company announced a wide-ranging strategic review including termination of in-house development of MTD201, closure of the Company's Bilbao operations and a re-alignment of the Board.
• On 20 April 2020, the Company announced an update to the strategic review including the appointment of an adviser and start of a "formal sale process" under the Takeover Code.
• MTX110 received orphan drug designation for malignant glioma including DIPG from the FDA.
• On 18 May 2020, the Company announced that it had raised gross proceeds of £4.3m (£3.8m net of expenses) in a combined UK Placing and Registered Direct Offering in the US. The combined offerings resulted in the issuance of 15.8m new Ordinary Shares and 16.5m new Warrants.
• On 8 June 2020, the Company received a letter sent on behalf of Secura Bio, Inc. ("Secura Bio"), dated 1 June 2020, purporting to terminate a License Agreement, dated 5 June 2017 (the "Secura License Agreement"), by and between Midatech Limited and Novartis AG, which Novartis AG subsequently transferred to Secura Bio. Pursuant to the Secura License Agreement, Midatech Limited was granted a non-exclusive worldwide, sublicenseable license to certain patents of panobinostat, the active pharmaceutical ingredient of the Company's development product MTX110. Midatech Limited's rights are limited to the treatment of brain cancer in humans, administered by convection-enhanced delivery. The Company plans to continue to pursue development of MTX110 and the strategic review process previously disclosed. The Company is also reviewing with its outside counsel remedies it may have if Secura Bio does not withdraw the notice and otherwise cease to interfere with its ongoing business and strategic review process, which the Company has formally requested. The Company is evaluating available actions to protect its rights under the Secura License Agreement and its assets.
Overview
Strategic ReportGovernanceFinancial Statements
01
Midatech Pharma at a glance
Listed on AIM and NASDAQ, Midatech is headquartered in Cardiff, UK. Following the announcement of a strategic review on 31 March 2020, the Company has terminated in-house development of MTD201 and is in the process of closing down its operations in Bilbao, Spain. After the closure, Midatech's remaining 20 employees will be focused on extracting value from its technology platforms.
On 20 April 2020, the Company provided a further update to the strategic review including the appointment of Noble Capital Markets, Inc. to advise the Board and the initiation of a "formal sale process" under the City Code on Takeovers and Mergers.
Technologies
Midatech is focused on developing products based on its three proprietary platform technologies, designed to deliver therapeutic drugs to the right place at the right time. The Company has three proprietary drug delivery technologies based on 120 granted patents, 70 applications in-process across 36 patent families:
Q-Sphera™ | MidaSolve™ | MidaCore™ |
Technology | Technology | Technology |
• Micro-encapsulation PLGA polymer | • Solubilises inherently insoluble drugs | • Gold nanotechnology to deliver |
depot system | • Nano inclusion technology for | chemo/immuno therapeutics |
• Advanced piezo printing technology | chemotherapeutics | • Key attributes are small size and |
• Several million microspheres | • Complex has hydrophobic core | multi-valent binding sites |
produced per second | and hydrophilic surface | • Decorated with therapeutic and |
targeting moieties | ||
Clinical | Clinical | Clinical |
Manufacture
• Scalable, efficient high yield manufacture
• Modest infrastructure, environmentally very friendly
• Low CoGS and broad API compatibility
• Multiple patent families
• | Superior sustained-release | • | Converts oral drugs into liquid | • | Size (2-4nm) improves delivery, |
pharmacokinetics | administration forms | targeting, reduces toxicity | |||
• | Improves usability, patient experience | • | Enables infusion directly into the | • | Enters immune cells to enhance |
and compliance | tumour | immune responses against tumour cells | |||
• | Enhanced dosing and administration | • | Aim to enhance efficacy and reduce | • | Research programmes in |
routes | toxicity | psoriasis and solid tumours |
Manufacture
• Simple manufacturing process
• No solvents, non-toxic
• Lyophilised powder, long shelf-life
• Product-specific patents
Manufacture
• Simple manufacturing process
• Modest infrastructure
• Multiple patent familiesWe have established proof of concept formulations using all three drug delivery platforms and have been tested in human clinical trials.
See our spotlight on lead programmes on pages 06 and 07
02
Midatech Pharma plc
Annual Report & Accounts 2019
Overview
Strategic ReportGovernanceFinancial Statements
Employees | Granted patents | Patent Families |
65 | 120 | 36 |
Development product pipeline |
Midatech's two lead programmes, MTD201 and MTX110, are both in clinical development.
Indication | Pre-clinical | Phase I | Phase II | Phase III/Pivotal | Registration |
Acromegaly
MTD201
Neuroendocrine tumours
DIPG
MTX110 Medulloblastoma
Glioblastoma
MTX114 PsoriasisCompleted
Under way / In preparation
03
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Midatech Pharma plc published this content on 30 June 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 June 2020 11:28:02 UTC