A period of continued significant progress
Avacta Group plc (AIM: AVCT), a life sciences company developing innovative, targeted oncology drugs and powerful diagnostics , is pleased to announce its unaudited preliminary results for the year ended 31 December 2022.
Operating highlights
Therapeutics – clinical and pre-clinical progress
· Avacta’s lead pre|CISION™ programme, AVA6000 – a tumour microenvironment activated form of a chemotherapeutic agent, doxorubicin:
o The first-in-human Phase 1 clinical trial (ALS-6000-101) progressed through the dosing of four cohorts (80 mg/m2 up to 200 mg/m2) following positive reviews of safety and tolerability data.
o Pre-clinical data regarding AVA6000 was presented at the American Association for Cancer Research (‘AACR’) 2022 Annual Meeting and the Theranostics FAP Summit.
o The US Food and Drug Administration (‘FDA’) granted Orphan Drug Designation (‘ODD’) to AVA6000 for treatment of soft tissue sarcoma.
· The next pre|CISION™ drug candidate, AVA3996, a tumour-targeted proteasome inhibitor based on bortezomib, was selected for pre-clinical development aiming for an Investigational New Drug Application in late 2023 to 2024.
· AffyXell Therapeutics (‘AffyXell’), the joint venture between Avacta and Daewoong Pharmaceutical (‘Daewoong’):
o Entered into collaborations with Biocytogen, a Chinese company specialising in developing new biological drugs, and with the Korea Non-Clinical Technology Solution Center (‘KNTSC’).
o The strategic partnership with GenScript ProBio, a leading biopharmaceutical manufacturer was expanded.
o Successfully completed a funding round to advance its lead mesenchymal stem cell (‘MSC’) programme towards the clinic, and to develop its wider pre-clinical pipeline of cell therapies.
o Avacta’s shareholding in AffyXell increased to 19% following the triggering of a milestone equity payment of £3.60 million.
· LG Chem Life Sciences (‘LG Chem’), the life sciences division of the South Korean LG Group, exercised its renewal option as part of the ongoing collaboration with Avacta, triggering a licence renewal fee payment to Avacta of $2 million.
· The Therapeutics Division relocated in April 2022 to new facilities at Scale Space, in Imperial College’s White City Campus in London, bringing together the research and development teams in a single site.
Events after the reporting period
· Announced the completion of the fourth dose escalation cohort of the Company’s Phase 1 clinical trial (ALS-6000-101) in January 2023.
· Analysis of tumour biopsy material shows that the active chemotherapy, doxorubicin, is being released in the tumour microenvironment, confirming the tumour-targeting potential of the pre|CISION ™ technology.
· In February 2023, hosted a Science Day for fund managers and analysts providing a detailed review of the ongoing Phase 1a clinical trial (ALS-6000-101) and update on preclinical programmes.
· First patient was dosed in fifth cohort of AVA6000 Phase 1a dose escalation study at 250mg/m 2 in April 2023
· Announced the opening of the first two US clinical investigator sites for patient enrolment.
· Presented pre-clinical data regarding AVA3996 at the AACR 2023 Annual Meeting.
Diagnostics – Significant progress towards establishing a fully integrated in vitro diagnostics business with first transformational acquisition
· Through its Diagnostics Division, the Group initiated a long-term ‘buy and build’ strategy in the fragmented European diagnostics sector with a vision to build a substantial in-vitro diagnostics (‘IVD’) business, with global reach, serving centralised pathology laboratories in hospital settings and decentralised testing in GP clinics, pharmacies and by consumers themselves.
· In October 2022, the Group acquired Launch Diagnostics, a leading independent IVD distributor serving hospital pathology laboratories in the UK and France for an initial cash consideration of £24 million payable upon completion, in addition to consideration for other short-term non-operating assets of £0.9 million.
· Avacta Diagnostics built an extensive pipeline of further acquisition opportunities to feed its M&A-led growth strategy.
Financial and Corporate highlights
· In October 2022, Avacta completed a fundraise of £61.3 million (gross) through a combination of:
o £55.0 million senior unsecured convertible bonds issued at a 5% discount from a fund advised by Heights Capital Ireland LLC (equating to £52.25 million post-discount).
o £9.0 million through a placing to new and existing shareholders and open offer
· Revenues of £9.7 million (2021: £2.9 million).
· Adjusted EBITDA loss (before non-cash and non-recurring items) of £15.1 million (2021: £21.7 million).
· Operating loss of £32.6 million (2021: £29.1 million).
· Reported loss from continuing operations of £39.5 million (2021: £26.4 million).
· Loss per ordinary share from continuing operations of 15.5p (2021: 10.6p).
· Cash and short-term deposit balances at 31 December 2022 of £41.8 million (31 December 2021: £26.2 million).
· Dr Christina Coughlin, a medical oncologist and immunologist and Chief Executive Officer of CytoImmune Therapeutics, Inc., appointed as Non-executive Director to the Board of Directors of Avacta in March 2022.
Dr Alastair Smith, Chief Executive Officer of Avacta Group plc, commented:
“I am very encouraged by the favourable safety data emerging from the ongoing phase 1a dose escalation study of AVA6000, which has confirmed the tumour targeting potential of the pre|CISION™ platform. We look forward to starting the dose expansion part of the phase 1 study later this year.
“The potential of the pre|CISION™ platform to create a pipeline of better tolerated chemotherapies and improved outcomes for patients has been further evidenced by the AVA3996 pre-clinical data recently presented at the 2023 American Association for Cancer Research Annual Meeting. These data not only support the pre|CISION™ mechanism of FAP activation, but also open up the possibility of treating solid tumours with a proteasome inhibitor for the first time, which would greatly expand the size of the market for this form of cancer therapy.
“I am delighted with the ongoing integration of Launch Diagnostics into the Avacta Diagnostics division following our acquisition of the largest independent in-vitro diagnostics distributor in the UK in October 2022. This is a first step towards our vision of building a fully integrated in-vitro diagnostics company supporting the healthcare professional and broadening access to diagnostics for consumers via a careful, disciplined M&A led growth strategy.
“The progress made during 2022 has positioned Avacta for further strong growth during 2023 and I look forward to updating the market fully as we hit key milestones across the Group.”
– Ends –
For further information from Avacta Group plc, please contact:
Avacta Group plc
Alastair Smith, Chief Executive Officer
Tony Gardiner, Chief Financial Officer
Michael Vinegrad, Group Communications Director
Tel: +44 (0) 1904 21 7070 www.avacta.com
