Pharma group is ‘stronger and leaner’ following administration

Cancer and fibrosis drugs developer Redx Pharma says it is a stronger and leaner company having emerged from administration.

Announcing its results for the year to September 30, today, the Alderley Park-based business said this had been a “seminal year” during which it had been “transformed”.

It declared: “Since successfully exiting administration in November 2017, the restructured board and new management team is delivering on the refocused vision of discovering and developing novel drugs with the potential to transform the treatment of cancer and fibrosis.”

Total revenue for the year came in at £100,000, compared with £30.5m in 2017, which was due to the sale of the group’s BTK programme to Loxo Oncology.

Redx posted a pre-tax loss for the year £8.8m, compared with a £1.5m pre-tax profit, previously.

Its total operating expenditure, however, was reduced from £15.8m to £10.6m, and the cash balance, at September 30, stood at £6.5m, down from £23.8m last year.

AIM-listed Redx exited administration on November 2, 2017, with a cash balance of £13.9m, and resumed trading its shares on AIM on November 6.

Admimistrators had been called in by Liverpool City Council following an ongoing dispute over a £2m loan that matured at the end of March, 2017.

Liverpool Council’s fall out with the company came after it relocated from Liverpool to Alderley Park, in Cheshire, towards the end of 2016.

In July last year the administrators agreed to sell one of the company’s development programmes to a US-based biotechnology company for £30.5m.

The sale meant all creditors were able to be paid and provide enough working capital to return the business to solvency.

Redx announced a revised strategy under the leadership of Iain Ross as executive chairman after exiting administration.

As a result of an extensive worldwide search, Lisa Anson was appointed as chief executive in June 2018 and Iain Ross reverted to the position of non-executive chairman.

A new management team has been built with the appointment of Dr Andrew Saunders, appointed as chief medical officer and the announcement today of Dr James Mead as a full time chief financial officer from February 1, 2019.

A comprehensive review led by Lisa Anson, confirmed the group’s strategic focus on oncology and fibrosis.

Today’s statement said the group remains on track to recommence the Phase 1/2a clinical trial of potential cancer treatment RXC004, at a significantly lower dose, in the first half of 2019 which would generate headline results in mid-2020.

The group’s first development candidate in fibrosis, RXC006 was selected in November 2018, with plans to be in clinic in 2020.

During the year the group delivered significant restructuring, reducing the cost base by one third, of which 80% was overhead.

Iain Ross said today: “This set of results confirms that Redx is operationally, a stronger and leaner company led by an ambitious new management team, with a clear strategic direction.

“Lisa Anson has made a major impact and under her leadership the group is starting to make real progress in our programmes aimed at creating high value drugs that treat significant unmet need in cancer and fibrosis.

“The board is committed to strengthening the group’s balance sheet in the short term and is in active discussions with shareholders, advisers, third party sector specialist investment groups and potential industry partners regarding funding and/or monetisation of early stage programme assets.”

Lisa Anson added: “I am pleased to report on the progress made by Redx during the year.

“The phase 1/2a clinical trial of our lead cancer asset, RXC004, an oral porcupine inhibitor, remains on track to re-commence in 1H 2019 with headline results expected in mid-2020.

“We remain confident that this programme can unlock the potential of the Wnt/ßcatenin pathway as a means to tackle unmet needs in cancer.

“Our re-focused strategy has also provided renewed momentum behind our fibrosis programmes.

“We believe we have a leading position in our selected areas of interest and recently announced the nomination of our first development candidate, RXC006, a novel porcupine inhibitor, as a potential treatment for idiopathic pulmonary disease, a progressive, orphan disease with limited treatment options.”