C4XD excited for future, despite revenues fall and widening losses
Annual revenues have declined, and pre-tax losses deepened, at Manchester drugs discovery company, C4X Discovery Holdings.
But the company said it is excited about the future.
Indivior made a £15.95m payment to acquire C4XD’s oral Orexin-1 receptor antagonist for substance use disorder under an asset purchase agreement, post reporting period, and the company signed an exclusive worldwide licensing agreement with AstraZeneca in November 2022, worth up to $402m, for its NRF2 Activator programme.
Figures released today by the company for the year to July 31, 2023, revealed revenues of £1.71m, a fall from the previous year’s £2.699m turnover. A pre-tax loss of £13.416m worsened from the previous year’s £10.534m loss.
R&D expenses increased by 16% to £10.9m, against £9.4m the prior year, reflecting focused investment in key drug discovery programmes.
Net assets stood at £6.5m, down from £11.8m in 2022, while net cash was £4.2m, compared with £5.1m a year ago.
During the year the company adopted a new strategic focus as an immuno-inflammation company, with new programmes identified progressing towards lead optimisation and beyond.
Mr Dix said: “This year has seen C4XD evolve significantly to build on its proven strengths and expertise and focus on immuno-inflammation.
“The licensing of our NRF-2 programme to AstraZeneca reinforced our confidence in our ability to discover high value new small molecule drugs in the space and the strategic divestment of our Orexin-1 programme further streamlined our portfolio and provided further resources to pursue this more defined path to value.
“The market potential in immuno-inflammation is large and growing, reflecting the need for better treatments.”
He added: “With a robust balance sheet, focused strategy and streamlined portfolio, we believe we are strongly positioned in immuno-inflammation and excited about the future.”
Investment bank Panmure Gordon analysts, Dr Julie Simmonds and Dr Mike Mitchell, reiterated their ‘Buy’ recommendation on C4X’s shares following today’s announcement.
They said: “FY results to July 2023 which, on an underlying basis, are broadly in line with expectations.
“C4XD shifted its strategy during the year to have a formal focus on immuno-inflammation, a field where it has already demonstrated significant success.
“We see the company as very good value considering the ongoing income likely from its out-licensed programmes, the potential for out-licensing of the in-house products and the highly successful drug development strategy; there are few companies which have successfully developed and out-licensed three differentiated products.
“We update our estimates for the FY results and reiterate our BUY recommendation.”
