Avacta Group PLC – AVCT – Final Results

Avacta Group PLC – AVCT – Final Results

Avacta Group plc (AIM: AVCT), the developer of diagnostics and innovative cancer therapies based on its proprietary Affimer® and pre|CISION™ platforms, is pleased to announce its preliminary results for the year ending 31 December 2020.

Operating highlights

Operating highlights - Diagnostics

· Rapid generation of a range of Affimer® reagents that bind the SARS-CoV-2 coronavirus spike antigen for diagnostic testing applications.

· Collaboration with several partners to develop a rapid test for the COVID-19 infection for mass population screening.

· Appointed BBI Solutions, part of BBI Group ('BBI'), and Abingdon Health to manufacture the saliva-based rapid SARS-CoV-2 antigen test.

· Entered a collaboration with the Liverpool School of Tropical Medicine ('LSTM') to provide analytical and clinical validation of the rapid coronavirus antigen test.

· Announced launch of an ELISA laboratory test for the SARS-CoV-2 spike protein to support global research efforts into the coronavirus that causes COVID-19.

· Collaboration with Adeptrix (Beverly, MA, USA) to develop a high throughput Affimer-based SARS-CoV-2 antigen bead-assisted mass spectrometry test ('BAMSTM' test) to be used on hospitals' existing installed base of mass spectrometers to diagnose COVID-19 infection. Initiated clinical evaluation of BAMS™ SARS-CoV-2 antigen test at a UK NHS hospital site.

· Exclusive distribution agreement announced with Medusa19 Limited ('Medusa19') for direct-to-consumer sales of a rapid antigen self-test for Covid-19.

· Major licensing agreement with Astrea Bioseparations Limited ('Astrea') for the use of the Affimer® platform in affinity purification applications.

· Successfully passed first audit by the Group's Notified Body (BSI Group) of the Company's Quality Management System as first step in establishing ISO13485 accreditation, a critical quality assurance system for a developer and legal manufacturer of diagnostic products and medical devices. The final audit will take place in April 2021.

· Strengthened and expanded diagnostics management team with the appointment of a Product Manager, Head of Product Development and Operations Director.

Post-period highlights - Diagnostics

· AffiDX® SARS-CoV-2 Antigen Lateral Flow Test shows excellent analytical sensitivity of 50 pg/ml of S1 spike protein with a read time of 20 minutes. As far as the Group is aware and on the basis of laboratory testing to date, this is currently the most sensitive S1 spike lateral flow test available. On 16 February 2021, we announced the initial clinical evaluation of this test using anterior (front) nasal swab samples (30 positive and 26 negative samples) which demonstrated a sensitivity of 96.7% for samples with an infectious viral load (PCR Ct value < 26) and a specificity of 100%. Subsequently, on 20 April we announced the completion of the clinical validation of the AffiDX® SARS-CoV-2 antigen lateral flow test with excellent performance data (clinical sensitivity of 98.0% for samples with Ct values up to 31 and clinical specificity of 99.0%).

· On 28 January 2021, we entered a collaboration agreement with Bruker Corporation to evaluate the clinical utility and commercial potential of the BAMS™ SARS-CoV-2 Antigen Test.

· On 8 February 2021, we established a commercial partnership with Mologic following several months' collaborative work to provide Avacta with a faster route to market for the lateral flow rapid antigen test by CE marking it for professional use under Mologic's existing ISO13485 quality system. The CE mark will then be transferred to Avacta after it receives ISO13485 accreditation, which is expected in April 2021.

· The collaboration with Mologic also provides initial manufacturing capacity with the benefit of a short set-up time for the lateral flow test with Global Access Diagnostics ('GAD'), in addition to the agreements with BBI Group, Abingdon Health and others, that will provide manufacturing capabilities that can be scaled to several millions of tests per month.

· On 9th March 2021, we announced a royalty bearing license agreement with Biokit, a Werfen Company, to develop and commercialise an Affimer-based in-vitro diagnostic test.

Operating highlights - Therapeutics

· Established a partnered programme ('AffyXell Therapeutics') in South Korea with Daewoong Pharmaceutical Co. Ltd., to develop the next generation of cell and gene therapies, incorporating Affimer® proteins to enhance the immune-modulatory effects. Programme subsequently expanded to provide access to the Affimer® platform for neutralising Affimer® therapies for the treatment of seriously ill patients with COVID-19 and to also prepare to rapidly develop similar therapies for future global pandemics.

· Demonstrated initial proof-of-concept for its proprietary new class of drug conjugate, 'TMAC®', in a pre-clinical animal model of cancer.

· Expanded the existing multi-target collaboration and development agreement with LG Chem Life Sciences ('LG Chem') to include new programmes incorporating Avacta's Affimer XT™ serum half-life extension system, deal worth up to $98.5 million plus royalties.

· Appointment of Neil Bell as Chief Development Officer responsible for the late stage pre-clinical and early clinical development of Avacta's pipeline of pre|CISION™ pro-drugs and Affimer® immunotherapies.

· Submitted the Clinical Trial Authorisation (CTA) to the UK Medicines and Healthcare products Regulatory Agency (MHRA) for a phase I dose-escalation and expansion study of AVA6000 pro-doxorubicin, Avacta's first pre|CISION™ FAP-activated prodrug.

· On schedule to select the next pre|CISION™ prodrug chemotherapy clinical development candidate from the pipeline by the end of 2021.

· Significant progress with in-house Affimer® bispecific programmes towards selection of a clinical development candidate by the end of 2021. Two new programmes initiated, building on the AVA004 PD-L1 antagonist programme: AVA027, a PD-L1/TGfβ receptor trap combination, and AVA028, a PD-L1/IL2 bispecific.

Post-period highlights - Therapeutics

· On 7 January 2021, we announced the licensing agreement with Point Biopharma Inc to provide access to Avacta's pre|CISION™ technology for the development of tumour-activated radiopharmaceuticals.

· Key appointments of Head of Chemistry, Manufacturing and Controls (CMC), Head of Clinical Operations and Head of Translational Sciences will together manage an extensive outsourced network of drug development service providers.

· On 1 February 2021, AffyXell Therapeutics ('AffyXell'), the partnered programme with Daewoong Pharmaceuticals ('Daewoong'), closed a series A venture capital investment of $7.3m to further develop its pipeline of next generation cell and gene therapies.

· On 18 February 2021, the Medicines and Healthcare products Regulatory Agency ('MHRA') approved the CTA for AVA6000 pro-doxorubicin for a phase I, first-in-human, open label, dose-escalation and expansion study in patients with locally advanced or metastatic selected solid tumours. The Group anticipates dosing first patients in mid-2021 subject to COVID-19 restrictions on hospital resources with first pharmacokinetics read-out possible before the year end.

Financial and Corporate highlights

· Fundraisings completed during the period raising £53.8 million to expand Diagnostics and Therapeutics programmes.

· Cash and short-term deposit balances at 31 December 2020 of £47.9 million (31 December 2019: £8.8 million)

· Revenues of £3.6 million for year ended 31 December 2020 (17-month period to 31 December 2019: £5.5 million)

· Operating loss of £21.3 million for year ended 31 December 2020 (17-month period to 31 December 2019: £18.0 million)

· Increased R&D investment across diagnostics and therapeutic programmes, leading to reported loss of £18.9 million (17-month period to 31 December 2019: £15.6 million)

· Loss per ordinary share 8.4p (17-month period to 31 December 2019: 13.0p)

· Paul Fry appointed as Non-executive Director. Paul is Chief Financial Officer of Vectura Group plc, an industry-leading inhaled drug delivery specialist listed on the FTSE Main Market.

Dr Alastair Smith, Chief Executive Officer of Avacta Group, commented:

"There is no doubt that 2020 was a momentous year for Avacta. I am enormously proud of the entire team who have been instrumental in delivering this transformational growth and creating substantial commercial and clinical opportunities for the Group for 2021 and beyond, despite the difficult working conditions imposed on laboratory working by the COVID-19 pandemic.

We are now very close to self-declaration of the CE mark of the AffiDX® rapid antigen test for professional use and commercial launch in early May. We have made very good commercial progress with potential distributors, licensing partners and large-scale end users and demand is strong. We also expect to see the first pharmacokinetic data for AVA6000 before the end of the year which will give us the first indication of the effectiveness of the pre|CISION™ chemistry in humans so I am very much looking forward to updating the market on these events and other progress across the Group during the coming months."

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