RNS Number:8147M
Proteome Sciences PLC
26 June 2003
For immediate release 26th June 2003
PRELIMINARY RESULTS FOR THE 12 MONTHS
TO 31ST DECEMBER 2002
HIGHLIGHTS
* Preliminary results
* Acquisition of the proteomics activities from Aventis R&T completed the
transformation of Proteome Sciences into a global leadership position in
applied proteomics.
* Established strong business development team and concluded two
commercialisation deals.
* Developed ProteoSHOPTM, a unique proteomics toolbox of proprietary next
generation technologies for disease biomarkers.
* Loss for year on ordinary activities after taxation of #4.1 million (2001:
#2.0 million loss).
* Cash balance at end of year of #4.3 million.
* Placing
* Placing with institutional investors on 26th June 2003 at 122p per share
raised #5.8 million, representing 5% of the Company's share capital.
* Commercialisation
* Licensing and development deal with Biosite Inc, in December 2002, for
detection of stroke in blood.
* Completion of licensing deal with IDEXX Laboratories Inc, in April 2003,
for BSE biomarkers in cattle and TSEs in other animals. The market for
testing cattle in the EU projected to be Euro450 million annually.
* Current Outlook
* Further commercialisation of stroke markers in high throughput testing
expected over next 12 months.
* Licensing from the TSE programme in areas of blood transfusion screening
and diagnosis of CJD and vCJD.
* Strong newsflow and commercialisation expected from other disease
programmes including acute and chronic organ rejection.
* Sensitizer(R) technology expected to be out-licensed.
* Current Outlook (continued)
* PST and TMT technologies have attracted considerable commercial interest
following their launches in the USA and Europe.
* Dr Sandra Steiner joined the Company as Research and Development Director
in May, completing the executive management team.
* Commercialisation has provided revenue in 2003 and will generate both
revenue and royalties in 2004.
* Revenue from out-licensing, funded research, strategic alliances, grants
and proprietary income.
* Intronn Inc.
* SMART(R) technology platform used successfully to correct cystic fibrosis
gene defect in human cell model and repaired mutant Factor VIII
(haemophilia) RNA.
* Research collaboration with ProBioGen Inc, for cell line development.
* Novel applications for SMART(R) in molecular imaging and for diagnostics
and drug development.
* Moved into purpose built facilities with several key appointments made
during the year - total headcount to 26.
* Veri-Q Inc.
* Concluded licensing agreement with North Carolina State University in July
2002 relating to impurity levels in oligonucleotides.
* Well underway to out-license technology across a range of applications,
with commercialisation expected later in the year.
Commenting on the results for 2002 and on current year progress, Christopher
Pearce, Chief Executive of Proteome Sciences, said:
"The last year has been of major strategic importance to Proteome
Sciences, having seen the business transform into a position of global
leadership in applied proteomics and achieved our first
commercialisation deal followed by a second early in the current year.
This endorses our strategy of concentrating on proteins and protein
modification in disease.
"The importance and value of proteins in biomedical research have been
greatly increased since the sequencing of the human genome in 2001 and
for Proteome Sciences this has been further enhanced by the unique
ProteoSHOPTM toolbox that has been developed. This gives us a
considerable advantage and an outstanding opportunity to capitalise on
the discovery of high value protein biomarkers with our partners that
will accelerate the development of diagnostic, prognostic and
therapeutic applications.
"We are well funded with a low and predictable rate of cash burn and do
not envisage any major capital expenditure for the foreseeable future.
The prospects for the ProteoSHOPTM proteomics technology, its
application in human diseases and the commercial potential across the
Group look increasingly attractive."
ENDS
Attached: Full text of preliminary statement, unaudited consolidated profit and
loss account and notes to the financial information.
For further information please contact:
Proteome Sciences plc Tel: +44 (0)1932 865065
www.proteome.co.uk Email: christopher.pearce@proteome.co.uk
Christopher Pearce, Chief Executive
Public Relations for Proteome Sciences Tel: +44 (0)1483 535102
IKON Associates Mobile: +44 (0)797 9900733
Adrian Shaw Email: adrian@ikonassociates.com
Notes to Editors:
Proteome Sciences plc applies high sensitivity proteomics to identify and
characterise differential protein expression in diseases for diagnostic,
prognostic and therapeutic applications. It has to date developed sensitive
blood assays for stroke, nvCJD, BSE and solid organ transplant rejection.
The main focus of its research currently addresses neurological,
neurodegenerative, diabetes/obesity, oncology and cardiovascular conditions.
Commercialisation of these programmes will be effected through strategic
alliances and licensing agreements.
Proteome Sciences is headquartered in Cobham, Surrey in the UK and has
laboratories at Kings College Hospital, London and in Frankfurt. It employs 40
full time scientists in addition to its corporate and business development
staff. The Company has been listed on the Alternative Investment Market since
1994.
Dear Shareholder,
I am delighted to report that the year under review has been a most significant
one for your company and has witnessed the conclusion of the transformation of
Proteome Sciences plc from a virtual company, prior to the sequencing of the
human genome in 2001, to a global leadership position in 2003 in applied
proteomics for human diseases. This process was largely completed following the
acquisition and integration of the proteomics activities of Aventis Research and
Technologies GmbH & Co KG (Aventis R&T) with our facilities in London in the
third quarter of 2002.
Over the same period, we have established a strong business development team
which has already successfully concluded the commercialisation of two of the
first products to be developed from applied proteomics - biomarkers in blood to
be used in a rapid test to detect stroke in humans and for BSE from blood
samples in live cattle.
The transition that has taken place clearly endorses Proteome Sciences' strategy
of concentrating on proteins and protein modifications in disease, rather than
following the conventional approach pursued by the great majority of life
sciences research in genomics.
Proteomics
The technology comprising proteomics is multi-disciplined and has been largely
concentrated and developed by specialist teams in academia rather than from a
commercial background. The range and high levels of expertise necessary to deal
with the extreme complexity of human diseases need to be combined and integrated
with new methods of data capture, analysis and pattern recognition.
Following the sequencing of the human genome in 2001, Proteome Sciences has been
particularly successful in putting together a unique toolbox to address
differential protein expression in diseases. This has been drawn from the strong
scientific foundations established through its long standing collaborative
agreements in human biology and protein separation with academia and more
recently through the acquisition of the specialist chemistry, computer sciences
and bioinformatics capabilities in Frankfurt.
As a consequence, Proteome Sciences not only has access and expertise across the
key segments of these disparate skills but also has assembled a range of
proprietary and next generation technologies (PST(R), TMT(R), PSS(R), ProteoPrep
(R), Sensitizer(R)) which provide it with considerable advantages in addressing
the requirements of pharmaceutical, biotechnology and diagnostics companies, in
crucial applications, and in particular in the area of membrane proteins. These
are the high value targets for drug discovery and development where existing
technology is currently not particularly effective. Proteome Sciences combines
high sensitivity capability with high throughput.
The Proteome Sciences toolbox ProteoSHOPTM is being applied across a large
number of human diseases including neurology, neurodegeneration, cardiovascular,
cancer and diabetes/obesity to identify novel disease biomarkers. The principle
applications are for:
* Diagnostic Markers
* Prognostic Markers
* Membrane Proteins
* Therapeutic Targets
* Drug Validation
These are being commercially exploited through licensing agreements, funded
research and strategic research alliances.
Commercialisation
The last twelve months have seen major activity in the Business Development
Department and the Company signed its first exclusive licensing agreement for
its stroke biomarkers with Biosite Inc, a world leader in point of care
diagnostics, in December 2002. This collaboration is proceeding extremely well
and Biosite are further validating and developing these markers for use in their
desktop Triage(R) point of care test. The information generated in developing
these markers will be used by Proteome Sciences to attract other licensees for
the high throughput clinical laboratory market which currently accounts for
approximately 90% of global diagnostic sales. Discussions are taking place with
interested parties and further commercialisation of Proteome Sciences' stroke
markers in other applications is anticipated over the next 12 months.
A second licensing deal was announced at the beginning of April 2003, with IDEXX
Laboratories Inc., a world leader in veterinary diagnostic products, granting
exclusive global rights for Proteome Sciences' BSE biomarkers in live cattle and
Transmissible Spongiform Encephalopathies (TSEs) in other animals. Like Biosite,
IDEXX will develop these markers further and intend using them in a blood assay
to detect BSE in live cattle and TSEs in other animals. The only tests currently
available for BSE are post-mortem tests. It is anticipated that the market for
live animal testing will be considerably larger as routine screening of cattle
herds becomes possible for the first time. This will address a major unmet need
in veterinary diagnostics.
The EU cattle population totalled 80 million in 2001. The BSE market for post
mortem testing of cattle was Euro105m, with the EU paying Euro15 for each test kit.
Experts estimate that the demand could grow to 30 million tests in the EU,
projecting a future market size of Euro450m. These figures exclude any demand from
the USA, which has an estimated 100 million cattle population.
Proteome Sciences continues to progress its research programme in human TSEs
(CJD and vCJD), and at the Siena Proteomics Society meeting in September, data
relating to new CSF and serum markers for the diagnosis of CJD and vCJD was
presented which showed 100% sensitivity and specificity in CSF. The recent
receipt of additional samples will accelerate the development and further
validation of these markers. Further licensing agreements from the TSE programme
are envisaged in due course for blood transfusion screening and diagnosis of CJD
and vCJD.
In solid organ transplant rejection, Proteome Sciences' biomarkers for detecting
acute and chronic rejection have attracted considerable interest and the Company
is in active discussions to out-license these to commercial partners.
In addition to biomarkers, Proteome Sciences has novel proprietary technologies
which fall under the ProteoSHOPTM brand - 'Proteome Sciences High Output
Proteomics'. Included in this is our automated, high throughput 2DE capability,
together with PSS(R) the spot detection and image analysis display system and
ProteoPrep(R) the sample preparation methodology.
Our PST(R) and TMT(R) technologies (gel free protein sequence tags) were
launched at major biotechnology meetings in San Diego, USA and in Lyon, France
in April 2003 and will be presented at BIO 2003 in Washington. These have
generated considerable commercial interest and we expect to start entering into
strategic research and development alliances using this powerful technology to
exploit the opportunities in membrane and membrane associated proteins later in
the year.
From our research activities, we have identified a number of proprietary
technologies which can be commercialised through out-licensing. Sensitizer(R) is
a novel chemical reagent that can enhance the sensitivity of mass spectrometers
up to 100 fold for the identification of proteins and biomarkers. Sensitizer(R)
both dramatically increases the number of proteins detected in a cost effective
manner and provides users of mass spectrometry equipment with the ability to
significantly increase the quantity and quality of data produced. This is
particularly important as mass spectrometry is central to modern proteomics and
is utilised in high volume/high throughput applications. Having announced
Sensitizer(R) in March to the trade, Proteome Sciences intends to conclude a
license agreement in the second half of 2003.
Intronn Inc.
Intronn has been involved in a most active period both in terms of its science
and its corporate development. The SMaRT(R) technology featured on the front
cover of Nature Biotechnology at the start of the year having successfully
corrected the cystic fibrosis gene defect in a human cell model in a paper
published by Dr. John Engelhardt (University of Iowa).
In June, mutant Factor VIII (haemophilia) RNA was successfully repaired using
SMaRT(R) transplicing by Dr. Christopher Walsh, University of North Carolina.
The National Institute of Health (NIH), USA recently awarded a $605,791 grant to
take the Factor VIII programme to the final stages of pre-clinical testing.
Approximately 80 per cent of haemophilia patients who suffer from mutations in
the Factor VIII gene can potentially be corrected by SMaRT(R) technology. SMaRT
(R) is also now being used in novel applications for molecular imaging in
diagnostics and drug development. Intronn Inc. was also awarded a US $434,000
grant by the National Cancer Institute, USA, for its research in molecular
imaging, and this will open up a new range of substantial commercial
opportunities and applications for SMaRT(R).
ProBioGen Inc. entered into a research collaboration with Intronn Inc. to use
SMaRT(R) in its cell line development programme. Further scientific results were
presented from the main research programmes by Intronn's principal academic
collaborators at the recent American Society of Gene Therapy meeting.
In March 2002, Intronn relocated to temporary incubator space in Rockville,
Maryland and subsequently moved into purpose built facilities in Gaithersburg,
Maryland in March 2003. A number of key appointments have been made including
Dr. Ed Otto as Chief Operating Officer (formerly COO at Genetic Therapy Inc., a
subsidiary of Novartis), Diane Greene, Vice President of Business Development
(formerly Director of Marketing, Celera Genomics) Dr. Gary Temple, Director of
Cancer Biology (formerly Invitrogen Inc.) and Nancy Streicher as Corporate
Controller. The key hires have now been completed and the total headcount stands
at 26.
Over the last year, Intronn has assembled and expanded the management, premises
and scientific staff at Gaithersburg, USA with an initial focus on the core
applications and advantages of SMaRT(R) in key areas of commercial interest.
Intronn is now well positioned to exploit the significant opportunities afforded
by the SMaRT(R) technology platform.
Veri-Q Inc
Veri-Q concluded a licensing agreement in July 2002 with North Carolina State
University in respect of the results, data and intellectual property of the
research relating to the levels of impurity in synthetic oligonucleotides, and
patents have been filed on the antibodies against the protecting/de-protecting
groups for applications in antisense therapeutics and oligonucleotide
diagnostics. Papers have been published in Analytical Biochemistry and Nature
Biotechnology, which revealed that 31% of commercial DNA products from eight
different suppliers had impurities because the protecting groups had not been
fully removed. This proves costly and unsatisfactory for the users of synthetic
oligonucleotides.
Veri-Q is in the process of out-licensing the technology for applications in
RNA, RNAi, DNA, chip technology and quality control in synthetic oligonucleotide
production and reagents. Commercialisation is expected later this year.
Results
In the twelve month period ended 31st December 2002, Proteome Sciences incurred
a loss on ordinary activities after taxation of #4,109,586 (2001: #2,003,152).
At the year end, cash and cash held on deposit stood at #4,255,750. Costs
relating to the acquisition of the Aventis proteomics activities totalled
#281,338. In addition, the Company has today raised #5.863 million by a placing
of 4,805,766 new ordinary shares of 1 pence each at a price of 122 pence per
share with institutional investors. The new ordinary shares represented 5% of
the Company's share capital prior to their issue and were issued under the
authority granted by shareholders at last year's Annual General Meeting.
Current Outlook
Proteome Sciences has established a global leadership position in applied
proteomics, in particular through the unique ProteoSHOPTM tool box that has been
developed. This includes PST(R) and TMT(R) technology which offer a highly
effective and novel solution to address membrane proteins, one of the main
targets and the high value area for the pharmaceutical industry.
Out-licensing of the blood biomarkers for stroke and BSE have already taken
place but further commercialisation will be undertaken for the same diseases in
different applications in high throughput testing and blood screening. There
will be a strong news flow from other disease programmes at Proteome Sciences in
respect of out-licensing through funded research, strategic alliances in
membrane proteins and using the ProteoSHOPTM tool box. In addition, some
proprietary technology will be out-licensed including Sensitizer(R) reagents and
Veri-Q antibodies where there will be high volume/high margin utilisation and
which will not undermine the technical advantages that have been established in
our proprietary proteomics platform. These should also provide a strong cash
flow contribution.
From a financial perspective, the commercialisation process will have a
significant effect on the business, moving into revenue in the current year and
then generating both revenue and royalties in 2004. This will be made up from a
combination of out-licences with upfront payments and milestones, funded
research, strategic alliances, grants and proprietary technology income from
Sensitizer(R) and Veri-Q. At the same time, the Company continues to have a low
and predictable rate of cash burn and does not envisage any major capital
expenditure for the foreseeable future.
The importance and value of proteins in biomedical research have been greatly
increased since the sequencing of the human genome in 2001 and for Proteome
Sciences this has been further enhanced by the unique ProteoSHOPTM tool box that
has been developed. This gives us a considerable advantage and an outstanding
opportunity to capitalise on the discovery of high value protein biomarkers with
our partners that will accelerate the development of diagnostic, prognostic and
therapeutic applications. The prospects for the ProteoSHOPTM proteomics
technology, its application in human diseases and the commercial potential
across the Group look increasingly attractive.
I would like to take this opportunity to thank all our employees, both in the UK
and overseas, and our collaborators for their hard work and commitment to the
progress at Proteome Sciences over the period, and to welcome Dr. Sandra Steiner
to the Company, the former Executive Vice President at Large Scale Biology
Corporation, Germantown, USA who was recently appointed as Research and
Development Director and completes our executive management team.
Steve Harris
Chairman 26th June 2003
2002 2001
# #
Turnover
Existing operations 100,057 -
Acquisitions 71,344 -
__________ __________
171,401 -
Cost of sales (131,753) -
__________ __________
Gross Profit 39,648 -
Other operating expenses (4,237,832) (2,110,648)
__________ __________
Operating loss (4,198,184) (2,110,648)
__________ __________
Existing operations (2,870,701) (2,028,489)
Acquisitions (1,327,483) -
__________ __________
Continuing operations (4,198,184) (2,028,489)
Discontinued operations - (82,159)
__________ __________
(4,198,184) (2,110,648)
Share of associate's operating loss (322,128) (33,774)
Interest receivable 85,259 104,197
Interest payable and similar charges (11,018) (32,846)
__________ __________
Loss on ordinary activities before taxation (4,446,071) (2,073,071)
Tax on loss on ordinary activities 336,485 69,919
__________ __________
Loss on ordinary activities after taxation (4,109,586) (2,003,152)
Equity minority interest - 26,128
__________ __________
Loss for the financial year (4,109,586) (1,977,024)
__________ __________
Loss per share
Basic and diluted (3.96p) (2.16p)
__________ __________
2002 2001
# #
Fixed assets
Goodwill 6,165,121 -
Tangible assets 1,503,311 671,067
Associates 949,863 1,415,638
Other investments 225,756 225,756
__________ __________
8,844,051 2,312,461
__________ __________
Current assets
Debtors 725,225 374,161
Cash held on deposit as short term investment 3,349,255 800,000
Cash at bank and in hand 906,495 261,024
__________ __________
4,980,975 1,435,185
__________ __________
Creditors: Amounts falling due within one year, including (1,840,698)
convertible debt (1,074,539)
__________ __________
Net current assets 3,140,277 360,646
__________ __________
Total assets less current liabilities 11,984,328 2,673,107
Creditors: Amounts falling due after more than one year (143,430) (163,173)
__________ __________
Net assets 11,840,898 2,509,934
__________ __________
Capital and reserves
Called-up share capital 1,141,153 915,384
Share premium account 15,516,629 12,945,904
Other reserves 10,755,000 -
Profit and loss account (15,571,884) (11,359,442)
Equity minority interests - 8,088
__________ __________
Equity shareholders' funds 11,840,898 2,509,934
__________ __________
2002 2001
# #
Net cash outflow from operating activities (3,494,131) (1,624,406)
Returns on investments and servicing of finance 74,241 71,351
Taxation 146,485
Capital expenditure and financial investment (47,546) (473,469)
Acquisitions and disposals 3,637,730 (78,569)
__________ __________
Cash outflow before financing 316,779 (2,105,093)
Management of liquid resources (2,549,255) 2,000,000
Financing 2,581,467 (52,417)
__________ __________
Increase/(decrease) in cash in the year 348,991 (157,510)
__________ __________
Reconciliation of operating loss to operating cash flows
2002 2001
# #
Operating loss (4,198,184) (2,110,648)
Depreciation charges 369,845 103,093
Amortisation charges 324,480 -
Profit on sale of tangible fixed assets (331) (9,079)
(Increase)/decrease in debtors (79,545) 37,444
Increase in creditors 89,604 354,784
__________ __________
Net cash outflow from operating activities (3,494,131) (1,624,406)
__________ __________
1. There has been no change to any of the accounting policies set
out in the 2001 statutory accounts, except that the Group policy for
accounting for deferred tax has changed to comply with FRS 19 "Deferred
Tax".
2. Following the loss of #4,109,586 incurred in the period, the
Directors do not recommend the payment of a dividend.
3. a. The calculation of the loss per share for the year
ended 31st December 2002 is based on the loss for the year of
#4,109,586 and on 103,672,012 Ordinary Shares, being the
weighted average number of shares in issue and ranking for
dividend during the year.
b. The calculation of the loss per share for the year
ended 31st December 2001 is based on the loss for the year of
#1,977,024 and on 91,538,400 Ordinary Shares, being the weighted
average number of shares in issue and ranking for dividend
during the year.
4. The preceding financial information does not constitute statutory
accounts as defined in Section 240 of the Companies Act 1985. The
financial information for the year to 31st December 2001 is based on the
statutory accounts for that year. These accounts, upon which the
auditors issued an unqualified opinion, and which did not contain any
statement under Section 237(2) or (3) of the Companies Act 1985, have
been delivered to the Registrar of Companies.
The statutory accounts for the year ended 31st December 2002 will be
finalised on the basis of the financial information presented by the
Directors in this preliminary announcement and will be posted to
shareholders this month. After that time they will also be available at
the Company's registered office: Coveham House, Downside Bridge Road,
Cobham, Surrey KT11 3EP.
This information is provided by RNS
The company news service from the London Stock Exchange
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