THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT IS DEEMED BY THE COMPANY TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER ARTICLE 7 OF REGULATION (EU) NO 596/2014 OF THE MAR. UPON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN
Preliminary Results for the year ended 31 December 2018
Sustained Progress made in 2018
Futura Medical plc (AIM: FUM), the pharmaceutical company developing a portfolio of innovative products for sexual health and pain, based on its proprietary, transdermal DermaSys® drug delivery technology is pleased to announce its preliminary results for the year ended 31 December 2018.
- Chairman's Statement
- Chief Executive's Review
- Financial Review
- Statement of Comprehensive loss
- Consolidated Statement of Changes in Equity
- Consolidated Statement of Financial Position
- Consolidated Statement of Cash Flows
- Following an extensive strategic review which was announced in September 2018, Futura has focused on maximising value in its development pipeline and product portfolio addressing two large market categories, sexual health and pain. The lead priorities are MED2005, its innovative topical treatment for erectile dysfunction (ED), and its pain portfolio including TPR100, a topical non-steroidal anti-inflammatory drug. Futura's core objectives are to:
- complete the development of MED2005, currently in Phase 3 clinical trial, and
- further realise value from the pain portfolio.
- In February 2018, Angela Hildreth joined Futura in the role of Finance Director, Chief Operating Officer and Board Director.
MED2005 - Topical glyceryl trinitrate (GTN) formulation for erectile dysfunction
- Publication of positive Phase 2a, "FM53" data, in peer-reviewed Journal of Sexual Medicine in February 2018.
- First Phase 3 study, "FM57", commenced in October 2018.
- Positive results from pharmacokinetic ("PK") study presented at the annual scientific meeting of the Sexual Medicine Society of North America (SMSNA) in November 2018, demonstrating safety and dose related absorption.
- First advisory panel meeting held with US key opinion leaders (KOLs) at the SMSNA meeting in November 2018. KOL reaction to the therapeutic potential for MED2005 in erectile dysfunction and its areas of differentiation as well as the ongoing clinical programme was highly positive.
MED2005 - Post year end
- Data presented at the European Society of Sexual Medicine (ESSM) congress in February 2019, including:
- Positive Phase 2a and Pharmacokinetic data
- In vitro impedance testing (concluded late 2018) which further supports the safety profile for male patients and their sexual partners.
- Second advisory panel held at ESSM in February 2019 with prominent European KOLs to discuss data and the on-going development and educational programme. As with US KOL peers, physician reaction was very positive.
- R&D event held in London in February 2019 including a presentation from Professor David Ralph, a world leading expert in erectile dysfunction and male infertility and Chair of the Futura Medical European Advisory Panel.
TPR100 - Topical non-steroidal anti-inflammatory for the pain and inflammation associated with sprains, strains and bruises and soft tissue rheumatism
- Marketing authorisation application by UK commercialisation partner, Thornton & Ross (a subsidiary of STADA AG) submitted to the UK Medicines and Healthcare products Regulatory Agency (MHRA) in July 2018.
- Ongoing commercial discussions with several potential distribution partners for other territories. Any further licensing deals are expected to be after UK regulatory approval.
TPR100 - Post year end
- Supporting Thornton & Ross on responses to initial MHRA feedback received in February 2019.
- £5.85 million raised in November 2018 to progress MED2005 through Phase 3 "FM57" study in erectile dysfunction.
- £5.89 million net loss in the period (31 Dec 2017: net loss £3.90 million).
- Cash resources of £9.16 million at 31 December 2018 (31 December 2017: £8.36 million).
James Barder, Chief Executive of Futura, commented: "2018 was a significant year of progress for Futura, with the commencement of enrolment of patients into our first Phase 3 trial with MED2005. The trial is progressing as planned, and we look forward to Phase 3 headline data by end 2019. During the year, in parallel to the clinical studies, our team has engaged with a number of eminent experts in the field of erectile dysfunction in both Europe and the US to discuss and gain valuable and positive feedback on the on-going development and educational programme for MED2005.
The funding secured in 2018 ensures that Futura has sufficient resources to complete and deliver the Phase 3 top line data by the end of 2019 - which the Board believes will be a major value inflection point for the Company."
Analyst meeting and webcast
The Executive Team will host a presentation at 10am (BST), 10 April 2019, for analysts at the office of N+1 Singer at 1 Bartholomew Lane, London EC2N 2AX.
2018 - a significant year for Futura Medical
Following an extensive strategic review which was announced in September 2018, Futura's strategy as an innovative R&D company, is to leverage its Dermasys® transdermal delivery technology to bring innovative products to market in sexual health and pain, bringing new treatment options to patients particularly in areas of significant unmet need. Erectile dysfunction (ED) is one such underserved area. It disrupts the lives of at least 1 in 5 men globally, affecting the sexual and emotional health of around 27 million men and their partners in the USA alone. There has been little innovation in ED treatments for over ten years and many patients continue to suffer dissatisfaction from existing treatments especially those looking for a fast acting treatment that can form part of sexual foreplay or those patients that are contraindicated from using existing therapies. Many patients do not just suffer from ED itself. They also suffer the debilitating toll it takes on quality of life, relationships and overall wellbeing for both themselves and their partners. Futura is therefore excited to be taking MED2005, its topical gel for ED through late stage clinical trials in order to make a significant difference in helping ED patients and their partners worldwide. With an independently assessed market potential of over $1 billion as a prescription treatment and subsequently over the counter (OTC) treatment, MED2005 is Futura's lead asset and a key value creation opportunity.
2018 was a busy year for execution. I would like to thank Futura's shareholders for their support and Futura's employees for their unstinting efforts in driving forward the progress of the Company, particularly the extensive preclinical and clinical development programme for MED2005, which requires an immense amount of detailed science, logistical and regulatory work, together with the outsourcing partners used as part of Futura's lean operating model. Futura has had dialogue with and taken the advice of industry stakeholders including potential licensing partners, US and EU regulators and leading experts in the field of sexual medicine, in designing the MED2005 clinical programme and we look forward to headline clinical data from the first Phase 3 "FM57" study by the end of 2019.
Finally, in February 2018, Derek Martin resigned from Futura and Angela Hildreth joined the Company as Finance Director and Chief Operating Officer. On behalf of the Board, I would like to reiterate our thanks to Derek for his contribution to the development of the Company during almost 10 years as Finance Director and to welcome Angela.
Robust governance and strategy
Governance and compliance continues to be a key focus for the Board. Board responsibilities, tasks and achievements for 2018 are described in detail in the Corporate Governance report of the 2018 Annual Report. The Board is focused on optimising Futura's strategies to capitalise on the Dermasys® transdermal technology product portfolio in sexual health and pain, in particular the opportunity for MED2005 in ED. The Board concentrates on ensuring management has the right resources and capabilities to succeed both now and in the future. Futura aims to be a source of new products for the consumer-oriented pharmaceutical and medical industries, in areas under-served by current treatment options and where innovation has stagnated to date. We are confident that Futura will sustain the entrepreneurial and innovative culture it has created, as it moves its Dermasys® based products forward in development and commercialisation.
As an innovative, specialist, R&D company it is our strategy to improve the lives of patients, particularly where they are dissatisfied with existing treatments. Meeting this objective goes hand in hand with value creation, which we seek to maximise by partnering at key inflection points. Our current focus is on sexual health and pain where we have found opportunities to leverage our Dermasys® technology to develop new products that solve clinically meaningful problems for patients.
This year has been an important 12 months of progress for Futura. 2018 saw the Company undertake an extensive review of its pipeline and product portfolio and it was determined by the Board that a more concentrated R&D focus on MED2005, as well as its pain relief gels, will best enable us to achieve our aims.
MED2005 - topical glyceryl trinitrate (GTN) formulation for erectile dysfunction
Supportive pharmacokinetic clinical data
Throughout 2018, Futura has continued to generate additional, positive results from pharmacokinetic ("PK") studies with MED2005. Data, which was also presented in November at the annual scientific meeting of the Sexual Medicine Society of North America (SMSNA), give the Company confidence in the safety and potential efficacy of MED2005, including at the higher doses now being studied in Phase 3. They will add to and strengthen the data packages Futura intends to file with regulators when seeking approval.
In the recent PK study we demonstrated a dose related absorption profile and good bioavailability of glyceryl trinitrate (GTN) when administered at doses 0.2%, 0.4%, and 0.6% GTN. This supports the Company's strong belief that higher doses of MED2005 should improve efficacy. The acceptable tolerance profile of all dose forms of MED2005 tested also allowed inclusion of these three higher doses within the Phase 3 study.
MED2005 was shown to lead to a rapid rate of GTN absorption with first detection in blood plasma in 4-5 minutes, reaching peak levels in the bloodstream within 10-12 minutes for all doses. These findings are consistent with a product that has shown a rapid onset of action in the Phase 2a "FM53" study. It was shown that there is a low GTN residue on the penis at 5 minutes even with a high, 0.6% GTN MED2005 dose. This provides reassurance that there is likely to be minimal risk in transference of GTN to the sexual partner during intercourse, even at the higher doses. This finding also supports the side effect profile seen in the Phase 2a "FM53" study where only four, mild side effects were seen in sexual partners out of 1,003 sexual intercourse attempts.
In February 2018, a peer reviewed paper was published in the Journal of Sexual Medicine detailing the Phase 2a, "FM53" study of MED2005 in ED. The study achieved its primary clinical endpoint and demonstrated efficacy, safety and a rapid speed of onset in a 0.2% GTN dose with MED2005. Positive outcomes were particularly promising in patients with mild and mild to moderate ED at this lowest dose of MED2005. We have confidence that the higher doses of 0.4% and 0.6% being studied in addition to the 0.2% dose in the first Phase 3 will show improved efficacy across patients with mild, mild to moderate and moderate ED. This represents the large majority of ED sufferers throughout the world and the largest commercial opportunity. Severe ED patients, who often have the most medical complications as well as being the oldest men, are a difficult patient cohort to treat. This is further evidenced by the limited success of the existing ED treatments. We therefore remain cautious over the potential benefit MED2005 will bring to severe patients. The first Phase 3 study will include patients of all ED severities as was the case in the Phase 2a study FM53, the analysis of the primary endpoints will pool data across mild, moderate and severe ED. Therefore if reduced efficacy in severe ED patients occurs, it is not expected to compromise the overall success of the study.
The publication of the Phase 2a clinical data in the leading, peer-reviewed scientific Journal of Sexual Medicine underlines the robustness of our previously reported study and demonstrates the level of scientific interest in MED2005.
MED2005 Phase 3 clinical programme underway
MED2005's first Phase 3 study, "FM57" commenced in October 2018. The study protocol has incorporated the Company's learnings from FM53, feedback received from potential commercial partners and also US and European regulatory agencies to optimise the commercial value as well as maximise the chances of clinical success and thereby regulatory approval.
This 1,000 patient study for the treatment of mild, moderate or severe ED includes approximately 60 centres across Central and Eastern Europe to ensure patients are recruited as quickly and efficiently as possible. Regulatory and ethics clearance to conduct FM57 has been received across all nine countries and the target of headline data by the end of 2019 remains on track.
Planning for a second, confirmatory Phase 3 study for MED2005 has been undertaken, again after extensive dialogue with regulators and our KOLs in the field of ED. This study will incorporate a US patient cohort which is expected to enable regulatory filing in the USA. This study is expected to be informed by the first Phase 3 and therefore start after end of the first Phase 3 study. We believe MED2005 has the required efficacy, speed of onset and favourable safety profile consistent with use as a prescription therapy as well as the potential to be an over-the-counter therapy as well.
Discussions continue with a number of interested commercial partners for the out-licensing of MED2005 although the Company's main focus is to deliver Phase 3 headline data by the end of 2019 to facilitate these ongoing discussions.
MED2005 safety profile in female partners
At the European Society of Sexual Medicine (ESSM) congress in Slovenia, 14-16 February 2019, Futura presented data which indicates that MED2005 will have a favourable safety profile in female partners. These data included observational data from the Phase 2a study where only four adverse events were noted in females out of over 1,000 intercourse events; penile swabbing data obtained from the PK Study which indicated that very low amounts of MED2005 remain on the penis after five minutes; and supporting evidence regarding the topical safety of MED2005, based on in vitro impedance testing concluded in late 2018. Results from the latter showed no significant difference in impedance between MED2005 and two commercially available lubricants used for sexual intercourse. These data is strongly suggestive that there is likely to be no increased risk of sexually transmitted infections being transferred to sexual partners, as a result of disruption to local tissue, when using MED2005 compared to the two lubricants also tested.
Education and outreach on erectile dysfunction and MED2005
Futura held its first advisory panel meeting with US experts at the SMSNA meeting in November 2018. The advisory panel were unanimous in their view that there has been little recent credible innovation in the treatment of ED and were therefore excited by the PK and Phase 2a "FM53" findings presented, which demonstrate the potential of MED2005 as both a topical and fast-acting erectile dysfunction treatment, key differentiators to other ED products on the market.
On 11 February 2019, Futura held a Research & Development Day in London for analysts and institutional investors. The event was well received with positive feedback and provided an opportunity to hear first-hand from Professor David Ralph, a prominent world leading expert in erectile dysfunction and male infertility and Chair of the Futura Medical European advisory panel, on the significant negative effect ED has on the quality of life, relationships and overall wellbeing of ED patients and their partners. The event also provided an opportunity for the Futura team to describe the Company's R&D strategy with a focus on its DermaSys® drug delivery technology and lead product MED2005's robust and extensive development programme. A webcast of the event is available on the Futura website.
Following the successful US advisory panel meeting at SMSNA in November 2018, a second advisory panel was held at ESSM in February 2019 to discuss MED2005 data and the on-going development and educational programme for MED2005 with prominent European KOLs. We were delighted that the feedback of this second EU advisory meeting very much echoed the sentiment and excitement seen at the first US advisory meeting. Further meetings are planned to update and increase awareness of the potential innovation that MED2005 brings within the treatment arena of ED.
TPR100 - topical non-steroidal anti-inflammatory for the pain and inflammation associated with sprains, strains and bruises and soft tissue rheumatism
In July 2018, Thornton & Ross, a subsidiary of STADA AG, Futura's UK commercialisation partner for TPR100, filed a marketing authorisation application for the product with the UK Medicines and Healthcare products Regulatory Agency (MHRA). In February 2019, the MHRA responded with some questions requiring some additional laboratory studies which are in the process of being conducted in order to address the MHRA's questions and allow the submission to progress and complete the review process. Futura has ongoing commercial discussions with several potential distribution partners for territories outside of the UK. Finalisation of such regional licensing deals is expected to be after UK regulatory approval.
CSD500 - condom containing the erectogenic Zanifil® gel
In September 2018, Futura received approval for a two-year shelf life for CSD500 for its European contract condom manufacturer. This milestone provides the company with an opportunity to focus its R&D resource fully on the far greater potential of its leading asset, MED2005.
As an innovative specialist R&D company, Futura does not have the marketing or regulatory medical device resource available to support the day-to-day requirements in a growing compliance-driven market and is in discussions with potential partners to assume these obligations. Futura expects to still benefit from the Intellectual Property of CSD500 through potential royalties, but the immediate potential for substantial royalties is low in the absence of a large global brand 'carrier' to take the product forward as previously advised. The Company will continue to explore national, multi-territory and regional agreements where the opportunities arise. The Company is expected to benefit from annual cost savings of approximately £400k in the event that it no longer maintains regulatory clearance itself for CSD500 as a medical device.
Corporate & Financial
In February 2018, Angela Hildreth joined Futura in the role of Finance Director, Chief Operating Officer and Board Director adding further experience to the executive team gained in financial, operational and strategic roles in healthcare and other industries and including the AIM market and development-stage companies.
The £5.85 million fundraising in November provided a new foundation to deliver additional value to our shareholders by progressing the development of MED2005 through the first Phase 3 study, maximising the commercial opportunity.
Futura is now in a position to build value by progressing the development of MED2005 through its planned Phase 3 studies and we look forward to headline data towards the end of 2019 after which we will examine the possibility of an accelerated European filing strategy depending on the strength of the data, including at the higher GTN doses for MED2005. We are excited to be moving closer to bringing an innovative, highly differentiated ED product to market that could help the many ED patients whose needs are not met by current treatments.
As outlined in the Chief Executive Officer's Statement, during the year, we continued to focus our financial resources on the development programme for our lead asset MED2005. Spend on research and development activities continued to grow with other central and administration costs remaining broadly the same as the prior year. November 2018 also saw gross funds raised of £5.85 million through the combination of subscription for shares through PrimaryBid and the Open Offer; and institutional placing.
Research and development expenditure
In July 2018 we commenced the first MED2005 "FM57" Phase 3 study across approximately 60 centres in Central and Eastern Europe with patients commencing recruitment in October 2018. FM57 costs together with additional costs relating to completion of the FM58 PK Study earlier in the year, and expected manufacturing stability and validation activities resulted in research and development expenses increasing by £1.9 million to £6.0 million for 2018 (2017: £4.1 million) which were in line with expectations.
Following the strategic review in the year, there has also been a focus on the reduction in costs relating to CSD500, an erectogenic condom, with limited costs relating to CSD500 expected in 2019.
There was no capitalisation of any Research and Development costs in 2018.
General and administration expenses increased slightly to £1.23 million (2017: £1.12 million). This reflects the continued focus on tight control of central costs with research and development activities out-sourced when required.
No revenue was recorded in the year. The Company resolved to focus its financial and human resources on late stage clinical development of its lead asset MED2005 to accelerate progress towards achieving a significant, continuous revenue stream within a few years.
It is expected that an R&D Tax Credit of £1.36 million will be claimed in respect of 2018 and the cash refund is expected to be received in the second half of 2019 from HMRC.
Loss per share
The basic loss per share for 2018 was £4.46 (2017: £3.23). Details of the loss per share calculations are provided in Note 11 to the accounts.
Cash balance at the end of 2018 was £9.16 million (2017: £8.36 million). Cash burn during the year was £5.63 million (2017: £5.02 million) primarily in relation to MED2005 research and development activities. Net funding of £5.48 million was raised in the year, resulting in a net cash inflow of £0.80 million. Futura is fully funded to deliver the top line data from the first Phase 3 study and will manage its funding strategy appropriately to what is expected to be a material inflection point for the Company.
For the year ended 31 December 2018
|Research and development costs||(6,038,941)||(4,100,453)|
|Loss before tax||(7,238,912)||(4,836,628)|
|Loss for the year being total comprehensive loss attributable to owners of the parent company||(5,880,576)||(3,900,284)|
|Basic and diluted loss per share (pence)||11||(4.46 pence)||(3.23 pence)|
For the year ended 31 December 2018
|At 1 January 2017||240,290||44,451,745||1,152,165||(33,260,172)||12,584,028|
|Total comprehensive loss for the year||-||-||
|Shares issued during the year||18||1,102||219,651||-||-||220,753|
|At 31 December 2017||241,392||44,671,396||1,152,165||(36,959,195)||9,105,758|
|Total comprehensive loss for the year||-||-||
|Shares issued during the year||18||167,775||5,312,464||-||-||5,480,239|
|At 31 December 2018||409,167||49,983,860||1,152,165||(42,692,938)||8,852,254|
Merger reserve represents the reserve arising on the acquisition of Futura Medical Developments Limited in 2001 via a share for share exchange accounted for as a group reconstruction previously using merger accounting under UK GAAP.
Retained losses represent all other net gains and losses not recognised elsewhere.
Share premium represents amounts subscribed for share capital in excess of nominal value, less the related costs of share issues.
As at 31 December 2018
|Plant and equipment||12||47,473||63,517|
|Total non-current assets||47,473||63,517|
|Trade and other receivables||15||306,408||181,076|
|Cash and cash equivalents||16||9,157,916||8,362,646|
|Total current assets||10,830,296||9,541,382|
|Trade and other payables||17||(2,025,515)||(499,141)|
|Total net assets/(liabilities)||8,852,254||9,105,758|
|Capital and reserves attributable to
owners of the parent company
For the year ended 31 December 2018
|Cash flows from operating activities|
|Loss before tax||(7,238,912)||(4,836,628)|
|Loss on disposal of fixed assets||703||-|
|Share-based payment charge||19||146,833||201,261|
|Cash flows from operating activities before changes in working capital||(7,099,102)||(4,641,255)|
|Decrease in inventories||13||62,633||13,228|
|(Increase) / decrease in trade and other receivables||(125,332)||(42,087)|
|(Decrease) / increase in trade and other payables||17||1,526,375||(356,036)|
|Cash used in operations||(5,635,426)||(5,026,150)|
|Income tax received||927,391||851,343|
|Net cash used in operating activities||(4,708,035)||(4,174,807)|
|Cash flows from investing activities|
|Purchase of plant and equipment||12||(4,510)||(55,594)|
|Cash generated by/(used in) investing activities||23,066||(36,278)|
|Cash flows from financing activities|
|Issue of ordinary shares||18||5,943,421||220,753|
|Expenses paid in connection with share issue||(463,182)||-|
|Cash generated by financing activities||5,480,239||220,753|
|(Decrease) / increase in cash and cash equivalents||795,270||(3,990,332)|
|Cash and cash equivalents at beginning of year||8,362,646||12,352,978|
|Cash and cash equivalents at end of year||16||9,157,916||8,362,646|
The Notes to the Financial Statements are contained in the full results which is available to
download in PDF format
Page last updated: 10 April 2019