Midatech Pharma PLC Announces Unaudited Interim Results for MTX110
Midatech Pharma PLC (AIM:MTPH.L) (NASDAQ:MTP), is a drug delivery technology company focused on improving the bio-delivery and bio-distribution of medicines, announces its unaudited interim results for the six months ended 30 June 2020.
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In March, an exploratory study was initiated with MTX110 by Columbia University in five patients with DIPG using an alternative convection enhanced delivery system.
In March, the Company announced a wide-ranging Strategic Review, updated in April to include a Formal Sale Process under the Takeover Code. The Formal Sale Process was subsequently terminated in July.
In March, the decision was taken to terminate further in-house development of the MTD201 programme with immediate effect although the asset remains available for licensing. All activities connected with MTD201 have been wound down expeditiously and the manufacturing facilities in Bilbao have been closed. Following the termination of in-house development of MTD201, the Company realigned its strategy towards exploiting its Q-Sphera technology more broadly.
In April, an exploratory study was initiated with MTX110 by the University of Texas, Houston in five patients with recurrent medulloblastoma.
In June, the Company signed a research collaboration with Dr Reddy's Laboratories Ltd under which Midatech is deploying its in-house expertise and Q-Sphera drug delivery platform to medicines nominated by Dr Reddy's.
In July, the Company signed a collaboration with an unnamed European affiliate of a global pharmaceutical company, to establish the application of the Q-Sphera platform to new modalities in drug delivery.
Total revenue in H1 2020 was £0.17m (H1 2019: £0.45m). Total revenue represents income from R&D collaborations plus grant revenue.
Research and development costs increased by 15% to £3.99m (H1 2019: £3.46m) as a result of lower MTX110 development costs, redundancy costs of £0.88m and write-down of Spain assets of £0.55m, offset by a negative share-based payment charge of £0.35m.
Administrative expenses increased to £2.93m (H1 2019: £2.05m) and included £0.35m one-time costs associated with Spanish Government loans, £0.07m UK redundancy costs and a £0.51m increase in legal and professional fees.
Impairment of intangible assets of £11.59m (H1 2019: Nil) related to the termination of further in-house development of MTD201 and associated IPRD and goodwill.
Net cash used in operating activities (after changes in working capital) in H1 2020 was £7.09m, compared with £4.56m in H1 2019.
In May, in a concurrent Registered Direct Offering in the US and a Placing in the UK, the Company raised £4.26m before expenses through the sale of 15.76m ordinary shares at £0.27 per share and warrants exercisable for 16.55m ordinary shares at £0.34 per share.
In July, the Company raised an additional £5.75m before expenses in an oversubscribed UK Placing, including a Broker Option, through the sale of 21.3m ordinary shares at £0.27 per share with no warrants.
Since the start of the Strategic Review the Company has developed two formulations for its internal Q-Sphera pipeline: one in CNS (MTD211) and one in transplant anti-rejection (MTD214). Each of the APIs was identified after a comprehensive evaluation of potential candidates. Both MTD211 and MTD214 address large markets and, as long-acting injectables, have the potential to offer significant clinical benefits compared with current therapies and, importantly for reimbursement, savings to the healthcare system. Both formulations are currently being optimised in preparation for IND-enabling in vivo studies later this year. Once completed, we will seek licensing and technology transfer agreements with partners for further development and, ultimately marketing.
Insofar as the Company is aware, there are no FDA approved long-acting injectable formulations of biologic products such as monoclonal antibodies or other forms of high molecular weight proteins. Proteins are delicate and easily de-natured in manufacturing processes which require significant shear forces, heat and/or certain types of solvent. Midatech’s Q-Sphera encapsulation printing technology is inherently less harmful than most traditional PLGA manufacturing methods. A significant number of latest generation medicines are protein based and could benefit from alternative dosing with long-acting injectables and, although there remain significant technical challenges, Midatech’s MTD215 programme is investigating the feasibility of encapsulating a monoclonal antibody using a model protein, representative of closely related therapeutics, to demonstrate proof of concept. If successful, the Company plans to apply the know-how to commercial opportunities.
MTD201, a long-acting Q-Sphera formulation of octreotide for the treatment of acromegaly and neuroendocrine tumours, reported a second Phase I study (“Study 102”) in 28 healthy volunteers comparing subcutaneous versus intramuscular routes of administration. The results showed similar pharmacokinetics and bioavailability for the two routes of administration. Although inhouse development of MTD201 has been terminated, the pre- clinical and two Phase I studies have demonstrated Q-Sphera proof-of-concept as a long-acting injectable formulation technology with several potential advantages compared with other PLGA-based technologies including; predictable kinetics, minimal burst release, improved injectability, simpler reconstitution and now, subcutaneous administration.
The Company’s MidaSolve project, MTX110, is being developed initially for the treatment of an ultra-rare, highly aggressive and inoperable form of childhood brain cancer called Diffuse Intrinsic Pontine Glioma ("DIPG"). This disease is universally fatal with an average life expectancy of nine months. Midatech is also evaluating MXT110 for the treatment of other forms of childhood brain cancer including medulloblastoma and glioblastoma multiforme ("GBM"), a fast-growing form of brain cancer in adults.
MTX110 utilises our MidaSolve nanosaccharide inclusion technology to solubilise an otherwise insoluble chemotherapeutic agent, panobinostat, allowing it to be administered directly into the tumour via a convection enhanced delivery (“CED”) system of micro-catheters. Panobinostat is already approved for the treatment of other cancers and is known to be one of the most potent agents against DIPG tumour cells. However, its lack of
solubility in water means that the currently marketed form of panobinostat can only be given orally and is not effective against brain cancers as it does not readily cross the blood-brain-barrier.
Our initial Phase I study in DIPG patients is being conducted by the University of California, San Francisco and is expected to report safety, tolerability and a recommended dose for Phase II within the next few weeks. Preparations for a Phase II trial of safety and efficacy in 19 patients with Kinderspital, Zurich are well advanced. The study endpoint is expected to be patient survival after 12 months.
The Company has initiated two additional exploratory trials; a study of five DIPG patients with Columbia University utilising an alternative CED system, and a study of five patients with University of Texas, Houston in medulloblastoma.
As announced on 9 June 2020, the Company received a letter from counsel to Secura Bio Inc. purporting to terminate the Company's licence to panobinostat. The Company remains of the view that the grounds for the purported termination of the panobinostat licence agreement by Secura Bio Inc. are unfounded. At this time, the Company is considering various avenues for a resolution and/or best options available to the Company.
We are waiting to hear from the EU whether Midatech meets the EU criteria for an SME and if the GlioKIDS grant will be confirmed.