Search for new equity funding impacts genedrive’s ‘going concern’ status
Manchester molecular testing business, genedrive, is seeking fresh funds, and said its need to bolster resources has affected its ‘going concern’ status.
It said at the current burn rate, the company has a cash runway through to May 2024.
It is confident it will continue to gain commercial traction and securing significant revenues, but due to the time required to achieve this, as previously stated, the business will require additional funding.
The business admitted that this represents “a material uncertainty that may cast significant doubt on the group and company’s ability to continue as a going concern”.
However, it said it is actively pursuing further equity funding to provide the necessary resources to execute the company’s growth strategy.
The announcement came with today’s interim results that showed revenues in the six months to December 31, 2023, of £0.24m, up from £0.02m the previous year.
The company made an operating loss of £2.4m, down from £2.7m the prior year. Its R&D spend of £1.9m fell slightly from £2m last time.
At the end of the reporting period genedrive had cash of £1.2m, compared with £26m at June 30, 2023. As of March 20, 2024, it had cash of £1.2m following a recent receipt of R&D tax credit of £0.8m.
During the six month period it reported progress with America’s Food and Drug Administration (FDA) for the Genedrive MT-RNR1 pharmacogenetic test.
The company is in advanced stages of negotiating a collaboration with a USA-based medical group to support a highly cost-effective pathway for the necessary clinical trials
The test is used for antibiotic induced hearing loss (AIHL) in infants.
Royal Sussex County Hospital, Brighton adopted the Genedrive MT-RNR1 ID Kit for routine use and there are ongoing discussions with other hospitals in the UK and Ireland with further near-term adoption anticipated.
Initial international sales of the MT-RNR1 ID Kit have been received from France, Austria, Greece, Saudi Arabia, Turkey and the Netherlands.
Chief executive, James Cheek, said: “Following my arrival in September I have seen the organisation really move forward with our commercial enterprises and it has been encouraging to see how we have been able to generate Genedrive MT-RNR1 kit sales both inside and outside the UK in such a short space of time.
“As well as our commercial focus, I have also been keen to ensure we have the right strategy for our business overall, leading to tighter controls over costs.
“I said in November, that for MT-RNR1, we would have a new UK site on board soon, sales coming in from overseas and a distributor in place to help us move forward with our desire to sell into the much larger USA market (subject to FDA approval).
“This has all been achieved and my focus going forward is on continuing with our MT-RNR1 sales, especially outside of the UK, as well as building our marketing and sales for CYP2C19 in the UK.”
He added: “Finally, we will seek to raise further equity funding in the coming weeks in order to provide a longer term financing solution for the company’s exciting growth plans.
“On behalf of myself and the board, I would like to thank our shareholders for their support and I look forward to what I hope will be a prosperous year.”
