link, ReNeuron Group Plc : ReNeuron announces Interim Results for the six months ended 30 September 2011 | 4-Traders

Guildford, UK: 28 November 2011
ReNeuron announces Interim Results for the six months ended 30 September 2011

Highlights

· ReN001 stem cell therapy for stroke:

- Five patients treated in PISCES Phase I clinical trial, with all remaining patients expected to be treated in 2012
- No cell-related adverse events or deteriorations in health reported
- Phase II efficacy study planned for 2013

· ReN009 stem cell therapy for critical limb ischaemia:

- Confirmatory pre-clinical efficacy studies completed with positive results
- Long term pre-clinical safety studies approaching completion
- Phase I/II clinical trial application planned for H2, 2012

· ReN003 stem cell therapy for retinitis pigmentosa:

- Further pre-clinical efficacy studies underway following license agreement signed with Schepens Eye Research Institute
- Retinal cell manufacturing process transferred to US-based contract manufacturer
- Phase I/II clinical trial application planned for mid-2013

· Board strengthened by appointments of John Berriman and Simon Cartmell as non-executive directors

· Loss for the period of £3.0 million (2010: £2.5 million); cash outflow from operating activities of £3.2 million (2010: £2.0 million); cash and cash equivalents at 30 September 2011 of £6.5 million (2010: £3.5 million)

Commenting on the results, Bryan Morton, Chairman, said:

"During the period under review, we have made good progress towards our ambition of developing a clinical-stage pipeline of high value stem cell therapies targeting significant and unmet disease conditions and with high commercial potential. The PISCES stroke trial is making steady and encouraging progress, with our ReN001 therapy exhibiting a very good safety profile in the disabled stroke patients treated thus far. Our other therapeutic programmes are also progressing towards the clinic to plan."

"We believe that our particular stem cell technologies and capabilities provide us with a real competitive advantage in the field and will stand us in good stead as we look to secure commercial development partnerships for our therapies in due course. We look forward to a very exciting period in ReNeuron's development."


Enquiries:

Michael Hunt, Chief Executive Officer - ReNeuron +44 (0) 1483 302560
Dr John Sinden, Chief Scientific Officer - ReNeuron

Lisa Baderoon, Mark Court, Isabel Podda +44 (0) 20 7466 5000
Buchanan Communications

David Hart, Oliver Rigby +44 (0) 20 7776 6550
Daniel Stewart & Company plc

Chairman's and Chief Executive Officer's Joint Statement

Review of Operations

During the six months ended 30 September 2011, we completed dosing of the first dose cohort of patients, and commenced dosing of the second dose cohort, in the ground-breaking Phase I clinical trial of our ReN001 stem cell therapy for stroke disability. The PISCES study (Pilot Investigation of Stem Cells in Stroke) is the world's first fully regulated clinical trial of a neural stem cell therapy for disabled stroke patients. The trial is being conducted in Scotland at the Institute of Neurological Sciences, Southern General Hospital, Greater Glasgow and Clyde NHS Board. In this safety study, the ReN001 stem cell therapy is being administered in ascending doses to a total of 12 stroke patients who have been left disabled by an ischaemic stroke, the most common form of the condition.

To date, five patients have been treated in the study: all three patients in the first dose cohort and two patients in the second dose cohort. The first, second and third patients treated in the first dose cohort are through their 12 month, 9 month and 6 month follow-up points, respectively. The first patient treated in the second dose cohort is through his one month follow-up point. The independent Data Safety Monitoring Board (DSMB) for the trial last met in late October, when it reviewed verified data from the first four patients treated at nine, nine, three and one month follow-up points, respectively. No cell-related adverse events have been reported in any of the patients treated to date and neurological and other safety assessments reviewed by the DSMB show no deterioration in the health of any of the patients as a result of the ReN001 treatment.

We expect that all remaining patients in the PISCES clinical trial will be treated over the course of 2012. We draw considerable encouragement from the progress of the PISCES study thus far and we have commenced the planning and design of a Phase II efficacy study with ReN001. In particular, we hope to be able to set criteria for this efficacy study that will target patients who we believe will best respond to the treatment in terms of the type, size and location of the stroke infarct which has caused their disability. During 2012, we intend to seek advice and clarification from the UK and other regulatory authorities regarding our clinical development strategy for ReN001, with a view to commencing a Phase II study in 2013.

During the period and thereafter, our collaborators at the Bristol Heart Institute completed pre-clinical studies successfully confirming the positive results from earlier pre-clinical efficacy studies with our ReN009 treatment for critical limb ischaemia, the end stage of peripheral arterial disease. Long term pre-clinical safety studies with ReN009 are also approaching completion. With the benefit of support and advice from leading vascular clinicians both in the UK and the US, we are planning to file in mid-late 2012 for approval to commence a substantial multi-centre Phase I/II combined safety and efficacy study with ReN009 in critical limb ischaemia patients. The final choice of location for this study will be determined by further regulatory interactions and the availability of the number of clinical centres that are likely to be required.

Our ReN003 collaborative programme for diseases of the retina continues to make progress in partnership with the Schepens Eye Research Institute in Boston, US, the initial clinical target being the blindness-causing disease, retinitis pigmentosa. Having secured the relevant intellectual property rights from Schepens to develop and commercialise our human retinal precursor cells (hRPCs), we have commenced pivotal pre-clinical efficacy studies to confirm the functional effects of these cells in models of retinitis pigmentosa. During the period, we have also transferred our highly efficient and proprietary hRPC cell expansion process to a contract manufacture in the US, ahead of GMP banking and long term pre-clinical safety studies. On this basis, we expect to be able to file an application in mid-2013 to commence a Phase I/II clinical trial with ReN003 in retinitis pigmentosa patients. We also hope to shortly announce the establishment of a Clinical Advisory Board of eminent clinicians to advise the Company on the clinical aspects of the ReN003 programme.

Subject to available funding, we are planning to test our lead CTX neural stem cell line pre-clinically in other diseases where we believe the properties of this cell line may confer benefit and where our existing CTX safety and quality data packages can be used in any consequent clinical trial applications. We are also progressing further pre-clinical studies to explore the potential of ReN001 as a broader treatment to include patients in the earlier stages of recovery from their stroke, as well as testing differing routes of administration of the ReN001 cells.

During the period, we announced the appointment of John Berriman and Simon Cartmell as non-executive directors of the Company. We further announced that Bryan Morton, an existing non-executive director, was to become Chairman, which took effect from 1st August 2011. At that point, Professor Trevor Jones stepped down as Chairman in order to establish and chair the Company's Scientific and Strategic Advisory Group. The remit of this advisory group will be to advise and assist the Company on strategic matters relating to its scientific and commercial agenda, including links to academic and industrial organisations and relationships with government bodies, the media and the public. We are in the process of clearing the appointments of the remaining members of this advisory group and we look forward to making a further announcement shortly in this regard.

Financial Review

In the six months to 30 September 2011, revenues were £28,000 (2010: £18,000), representing royalty income from the Group's non-therapeutic licensing activities.

Net operating expenses were £3.4 million in the period (2010: £2.9 million). Research and development expenditure increased in the period to £2.5 million (2010: £1.7 million), reflecting additional costs incurred in the treatment of patients in the PISCES clinical trial with ReN001, further investment in the manufacturing development of the Group's therapeutic stem cell products and the progression of pre-clinical work on the ReN003 retinal programme following the signing of the collaboration agreement with the Schepens Eye Research Institute. General and administrative costs in the period reduced to £0.9 million from £1.2 million, primarily as a result of the Group ceasing to incur legal fees in connection with an intellectual property dispute with a competitor business, which settled in January 2011.

Other operating income of £135,000 received in the prior period represented grant income received from the UK Government's Technology Strategy Board under its Regenerative Medicine funding programme. No grant income was received in the current period.

Interest received increased in the period to £25,000 (2010: £10,000) as a result of higher average levels of cash deposits held over the period.

The Group accrued a research and development tax credit of £344,000 during the period (2010: £236,000), the higher claim reflecting the increase in pre-clinical and clinical activity across the Group's core therapeutic programmes.

As a result of the above income statement movements, the total comprehensive loss for the period increased to £3.0 million (2010: £2.5 million).

The basic and diluted loss per share reduced to 0.5p per share (2010: 0.6p loss), reflecting both the increased loss and an increase in ordinary shares in issue in the period following the £10 million share placing completed in December 2010.

Cash outflow from operating activities increased in the period to £3.2 million (2010: £2.0 million), due to a combination of the increase in operating expenses in the period and an adverse working capital position following a comparative reduction in creditors since the 31 March 2011 financial year end.

As a result of the above cash flow movements in the period, the Group had cash and cash equivalents totalling £6.5 million as at 30 September 2011 (2010: £3.5 million).

The directors expect the Group's current financial resources to last into the fourth quarter of 2012. The directors are confident of securing equity-based and other sources of funding sufficient to meet the Group's ongoing requirements thereafter. Based on the above, the going concern basis has been adopted in the preparation of these interim financial statements.

Outlook

During the period under review, we have made good progress towards our ambition of developing a clinical-stage pipeline of high value stem cell therapies targeting significant and unmet disease conditions and with high commercial potential. The PISCES stroke trial is making steady and encouraging progress, with our ReN001 therapy exhibiting a very good safety profile in the disabled stroke patients treated thus far. Our other therapeutic programmes are also progressing towards the clinic to plan.

We believe that our particular stem cell technologies and capabilities provide us with a real competitive advantage in the field and will stand us in good stead as we look to secure commercial development partnerships for our therapies in due course. We look forward to a very exciting period in ReNeuron's development.


Bryan Morton Michael Hunt
Chairman Chief Executive Officer

28 November 2011