Paris, October 31, 2022 – 7:15 p.m. CET – Neovacs (Euronext Growth Paris: ALNEV) announces its 2022 half-year results. The half-year financial report is made available to the public today on the company’s website.
Hugo Brugière, CEO of Neovacs, says: “
The start of the 2022 financial year is marked by an acceleration of our strategic plan, both in terms of the company’s clinical developments and investments to enrich the asset portfolio and the potential for value creation. This was done in full compliance with the commitments made, whether vis-à-vis the Commercial Court which validated the recovery plan for which we have reimbursed all of the installments set 8 years in advance, vis-à-vis investors to whom we have promised a balanced investment between clinical developments and equity investments. Beyond that, the financial income generated in the short term by our cash confirms our management as a good father.
»
New advances in research programs around the Kinoid® technology platform before expanding research around mRNA technology
After several months of negotiations, Neovacs reached an agreement with its partner Biosense Global in the treatment of lupus. This “win-win” agreement ensures the continuation of the IFNα kinoid program in lupus based on the results of phase IIb carried out by Neovacs, which showed the relevance of the approach based on the use of IFNα kinoid. This agreement allows the resumption of clinical trials in China, fully supported by Biosense Global, and offers Neovacs a new perspective for the valuation of a strategic asset without any incurred cost. As such, the transfer of know-how is in progress and BioSence informed Néovacs, at the beginning of the summer, that a pre-IND phase (
Investigational New Drug
) was initiated before the possible launch of a new phase IIb.
With this agreement, Neovacs can now focus on its research programs in the field of allergies. As such, the company has signed two worldwide exclusive license agreements negotiated with the private subsidiary of Inserm (Inserm Transfert), on behalf of its historical academic partners, Inserm and the Institut Pasteur, on patent families strategic. These patents define and protect the clinical development work and commercialization of candidate vaccines in the fields of asthma and food allergies. Through these new agreements, the company secures the exclusive rights to exploit these inventions.
Neovacs also broadened its technological potential by announcing, in October, the filing of an international patent application for its new messenger RNA (mRNA) platform in the field of autoimmune and inflammatory diseases, particularly allergies. The invention thus protected relates to a therapeutic vaccine and its use for treating pathological effects associated with aberrant IL-4 and IL-13 expression, in particular asthma, food allergies, venom responses and occurrence of anaphylactic shock, atopic dermatitis, pulmonary fibrosis and chronic obstructive pulmonary disease (COPD). This vaccine, easy to produce, would complement the use of Kinoid products.
3 new strategic investments since the beginning of 2022
At the same time, investment activity in promising projects, both in the development of drug candidates (BioTech) and medical devices (MedTech), has also experienced a marked acceleration since the start of 2022. After the 2 operations with
Bio Detection K9 and Signia Therapeutics in 2021, Neovacs has decided to support:
MEDICAL DEVICES VENTURE, on the occasion of its IPO, in order to make it its new preferred investment vehicle in the world of MedTech. Neovacs has invested €1 million in the company;
NETRI, in order to support the growth of the company and to enable it to become the world leader in the organ-on-chip industry and to expand its fields of application. Neovacs has invested €2 million
[1]
.
Above all, after the half-year closing, Neovacs became a strategic partner of Pharnext by granting it financing for a nominal amount of €21.1 million. Through this agreement, Neovacs could eventually become a reference shareholder of Pharnext in the event of the success of phase III of the drug candidate in Charcot-Marie-Tooth disease type 1A. To date, Néovacs has subscribed to the first two tranches for a total amount of €13.2 million.
The Simple Bonds issued bear interest at the rate of 1% per month which, added to the discount granted to Néovacs, generates an overall annual return of €2.5 million per year. Pharnext has also agreed to pay Neovacs a commitment fee of €1.1 million excluding tax, in the form of a debt issued upon signature of the agreement
[2]
.
€33.0m in cash at the end of June 2022, stable compared to the end of 2021
In order to finance its activity and its investment plan, Neovacs used its financing line in bonds convertible into shares and raised a total of €5.5 million during the 1
er
half of 2022. The drawings made on these contracts and the resulting conversions into new shares of the company have made it possible to consolidate the company’s cash and its equity.
Thus, as of June 30, 2022, Neovacs had cash of €33.0 million (€33.1 million at the end of 2021) after having invested, in accordance with its roadmap, nearly €6 million, including:
50% in its operational activities (€3.0 million compared to €2.1 million on 1
er
semester 2021). The company recognized €2.7 million for research and development activities during the 1
er
half of 2022 compared to €2.6 million during the same period of 2021.50% in investment activities.
The company has also decided to invest 66% of its cash in different financial products. This strategy made it possible to generate €1.3 million in financial income in the 1
er
half of 2022. Néovacs notably subscribed to a bond issue issued by HBR Investment Group for an amount of €3 million. The repayment term is set at 4 years from the date of issue and the fixed interest rate is 5%.
Financial debt is limited, as of June 30, 2022, to €1.2 million (corresponding to bonds not yet converted at closing) for €46.6 million of equity.
On the date of publication of this press release, after the investment in Pharnext and a new drawdown on the financing line, the company has:
€18 million in available cash to enable it to finance ongoing programs;
€29 million of residual drawdown capacity also strengthening its ability to cover its liquidity risk.
ABOUT NEOVACS
Neovacs is a French biotechnology company, listed on Euronext Growth since 2010, specializing in therapeutic vaccines targeting the treatment of autoimmune diseases. Its innovative technology called Kinoid®, patented until 2038, makes it possible to induce a polyclonal immune response, applicable in several indications. Neovacs has developed IFNα Kinoid for the treatment of lupus in a phase IIb clinical study. The main study has been completed, the full results were presented on the 13
th
2019 international lupus congress. The Company has also completed promising preclinical work with another therapeutic vaccine, IL-4/IL-13 Kinoid, for the treatment of allergies. The ambition of this “Kinoid® approach” is to enable patients to better tolerate a lifelong treatment which would be more effective, well tolerated and very flexible in its administration.
For more information :
www.neovacs.fr
Jérôme FABREGUETTES-LEIB | Deborah SCHWARTZ |
s
[1]
With an option for an additional investment of up to €1 million subject to the achievement of objectives and according to the needs of the company
[2]
In the event that, as of December 31, 2023, one or more tranches are not drawn down for a reason exclusively and directly attributable to Neovacs, Pharnext will be recredited with the amount corresponding to the commitment fee applied to the undrawn tranche(s).
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