Cizzle Biotechnology Holdings PLC (LON:CIZ), the UK based diagnostics developer, has announced its results for the six months ended 30th June 2021.
Highlights
· Completed the acquisition of Cizzle Biotechnology Limited (“CBL”) on 14 May 2021 and admission to trading on the London Stock Exchange by way of a Standard Listing, raising gross proceeds of £2,200,000 before expenses from the issue of new shares.
· Change of the company name from Bould Opportunities plc to Cizzle Biotechnology Holdings plc.
Post Period Highlights
· Significant progress has been made to establish the foundations of the Group in its ambition to commercialise and realise the potential of its proprietary CIZ1B biomarker technology that has been developed by Professor Dawn Coverley and her team at the University of York for the early detection of lung cancer.
· A collaboration agreement was signed with FairJourney Biologics to develop proprietary antibodies for early lung cancer detection tests. This important step will not only enable the Company to develop its early ELISA hospital laboratory test, but also provide reagents that can be produced and licensed to commercial partners and facilitate adoption with key clinical opinion leaders worldwide.
· A Memorandum of Understanding (“MOU”) was completed with St George Street Capital (“SGSC”), to collaborate together to develop a companion diagnostic platform for certain therapeutic assets licensed to SGSC from one of the world’s largest pharmaceutical companies, Astra Zeneca. This seeks to address unmet clinical needs in a wide variety of autoimmune diseases which will significantly broaden the Company’s product pipeline and for which SGSC will pay up to £1 million in development fees.
· A full commercial royalty sharing agreement announced with SGSC grants the Company potential future royalty payments of up to £5 million from the commercialisation of SGSC’s therapeutic asset, AZD1656 for the treatment of COVID 19 in vulnerable diabetic patients. Under the terms of the agreement the Company will pay to SGSC £135,000 in addition to £65,000 it paid on signing the MOU.
· A new research agreement was signed with the University of York, a member of the Russell Group of research-intensive universities and one of the world’s premier institutions for inspirational and life-changing research, for the development and validation of molecular tests with potential applications in cancer diagnosis and therapy.
Commenting Allan Syms, Chairman of Cizzle Biotechnology, said :
“The Group’s focus on providing pivotal and diagnostic products for the early detection of cancer and other life-threatening illnesses took a major step forward following the acquisition of CBL, which is developing a product for the early detection of lung cancer that has the potential to decisively help front line physicians detect lung cancer in the clinic. For too long, their diagnostic choices have had to rely on increasing invasive procedures that in many cases are unnecessary. Given the rapid advances in biologics and endoscopy, there is an urgent need now for earlier stages of lung cancer to be reliably found where survival is meaningfully improved for the patient. The Group believes that is has the potential to be part of that step wise change through the development of a product for the early detection of lung cancer. This is proceeding well and in accordance with our business plan.
“The collaboration with FairJourney Biologics represents a significant step and in addition to providing the key antibodies for our hospital test, provides the opportunity to licence these proprietary key reagents to other global manufacturers to ensure that we help facilitate early cancer detection everywhere and help improve patient prognosis as widely as we can.
“Our next steps will be to consider how we can broaden the use of our technology for widescale screening in doctor’s office testing. We also are keen to broaden the scope of our tests beyond lung cancer so we can address the challenge of early diagnosis in other cancers with unmet needs. Our continuing commitment to research at the University of York will play an important part in that potential being realised.
“Clearly early diagnosis is a vital tool in enabling early clinical intervention and improving patient outcomes for a wide range of diseases, notably lung cancer. In addition, diagnostic products can be used to identify which patients may prove most likely to respond to new drugs with the least side effect burden to patients. Such companion diagnostics are a key part of treatments for cancer, and other serious illnesses. Our new partnership with SGSC opens doors for the Group to apply its expertise and products in this regard, initially focussed on tests involved in autoimmune disease. That the Group can now benefit from attractive potential royalty streams from new therapeutics, as well as associated companion diagnostics, and is expected to benefit from near term revenues from development fees, is important to the Group’s long-term ambitions.”
Executive Chairman’s statement
Operational and strategic overview
The major event during the period was the completion of the acquisition of CBL on 14 May 2021 and admission to trading on the London Stock Exchange by way of a Standard Listing. As part of the listing process the Company raised gross proceeds of £2,200,000, before expenses, from the issue of new shares. Following the acquisition, the Group’s principal activity is now focussed on realising and commercialising, through systematic development, CBL’s technology for the early detection of cancer.
CBL, a spin-out from the University of York, founded in 2006 by Professor Coverley, is developing a blood test for the early detection of lung cancer. CBL’s technology is based on the ability to detect the CIZ1B variant of the C1Z1 protein, which is a naturally occurring cell nuclear protein involved in DNA replication. The targeted C1Z1B variant is a stable plasma biomarker that is highly correlated with early-stage lung cancer. CBL’s proof-of-concept prototype test is based on the ability to detect CIZ1B in patient’s blood. Peer-reviewed published research led by Professor Coverley has demonstrated that CIZ1B can be measured via a simple ELISA test, which should allow for its incorporation into established hospital high-throughput testing platforms. We believe that this development overcomes an important barrier to further clinical development of this blood test, and should allow for the detection of lung cancer at a stage when the disease still bears a good prognosis.
Cizzle Biotechnology’s goal is to help front line clinicians in their diagnostic decision making by providing a test that can quickly and accurately give another perspective on whether a patient should be sent forward for more invasive testing. For the majority of patients fortunate enough to have presented with benign radiological findings, such a test would avoid the need for intrusive follow up testing, which can include repeated CT scanning and/or tissue biopsies, which are both costly to the NHS, health providers and medical insurers and stressful to patients.
The Board intends for the Company’s initial product to be a diagnostic immunoassay that can be readily performed by hospitals and reference laboratories, but a potential follow-on product could be a point of care test provided by a primary health care provider e.g. for doctor’s office testing. The Board is currently focussed on the development of the C1Z1B biomarker test through to CE marking and/or FDA 510(k) clearance and will additionally consider broadening its product range into screening tests and tests for other forms of cancer. Significant progress has been made since the acquisition to establish the foundations of the Group in its ambitions as a developer and supplier of innovative clinical diagnostic tests, and to commercialise the CIZ1B biomarker technology.
The collaboration agreement with FairJourney Biologics to develop proprietary antibodies is a key milestone in achieving our goals and will provide important tools that can be used to build not only our own range of hospital and doctor’s office tests, but also provide proprietary licensing opportunities with commercial and clinical partners worldwide. Our new research agreement with the University of York for the development and validation of these molecular tests will strengthen those ambitions.
Post period end, in June 2021, a Memorandum of Understanding (“MOU”) was completed with SGSC, to collaborate on the development of a companion diagnostic, which is a clinical test used to support the safe and effective use of a corresponding drug in appropriate patient populations. This relates to certain therapeutic assets (AZD16560) licensed to SGSC by Astra Zeneca which has been shown to affect the immune system at sites of damaging inflammation which can be typical in autoimmune disease and hence seeks to address unmet clinical needs in autoimmune disease.
SGSC is a biomedical research charity founded to fast-track clinical trials to get new treatments as quickly as possible to the people who need them. The charity brings together a powerful mix of expertise, from investors and business managers to academics and clinicians, and has formed a long-term strategic relationship with Cizzle where we can each benefit from strategically aligned skill sets, building a complimentary portfolio of diagnostic and therapeutic products.
In September this year, SGSC reported encouraging results from its ARCADIA clinical trial. The trial was initiated from an existing collaboration between SGSC and AstraZeneca and funded by international investment through Excalibur Medicines Ltd and an HM Government grant through the UKRI/Innovate UK programme. Cizzle has secured royalty sharing rights for AZD1656 for treating COVID 19 and additional disease indications,.
During September 2021 a royalty sharing agreement was announced with SGSC to grant the Company potential future royalty payments from the commercialisation of AZD1656, of up to £5 million. Under the terms of the agreement the Company has paid £135,000 to SGSC in addition to the £65,000 it paid on signing the MOU. The Company intends, in due course to execute our collaboration agreement, whereby SGSC will, in addition, pay the Group fees of up to £1m for the development of a companion diagnostic.
Financial overview
During the six months ended 30 June 2021, the Company transformed itself from a cash shell into an operating group that is a focussed healthcare diagnostics developer. The Group consists of Cizzle Biotechnology Holdings PLC as the parent company with wholly owned subsidiaries, Cizzle Biotechnology Ltd (“CBL”) and Cizzle Biotech Ltd (formerly Enfis Ltd).
The financial results for the six months to 30 June 2021 are summarised as follows:
· Corporate expenses, before exceptional items, H1: £119,000 (H1 2020, CBL: £8,000).
· Exceptional corporate expenses relating to the acquisition of CBL, H1: £3,219,000 (H1 2020, CBL: £Nil) which include transaction costs of £304,000 and a non-cash share-based expense of £2,815,000. The share-based expense of £2,815,000 arises as these interim financial statements have been prepared using the reverse acquisition methodology of consolidation. Rather than recognising goodwill this expense represents the equity value given up by CBL’s shareholders and the share of the fair value of net liabilities gained by CBL’s shareholders. This is recognised as a share-based payment on reverse acquisition and represents in substance the cost of acquiring a London Stock Exchange listing.
· Total comprehensive loss in H1 2021: £3,238,000 (H1 2020, CBL loss of £8k).
· Loss per share in H1 2021: (3.79)p, (H1 2020, CBL: loss of (0.004)p).
· Cash balances as at 30 June 2021: £1,425,000 (30 June 2020 CBL: £10,000).
