e-Therapeutics' Interim Results for the Six Months Ended 31 July 2013

E-Therapeutics plc (AIM:ETX), the drug discovery and development company, today announces its interim results for the six months ended 31 July 2013.

Commenting on the results, Professor Malcolm Young, CEO of e-Therapeutics, said: "Following our successful fundraising we are investing in further development of our network pharmacology platform, in applying this technology to add to our drug portfolio and in advancing our leading compounds, notably the cancer drug ETS2101, through clinical trials. We are confident this strategy will lead to value-realising partnering deals.”

Chairman’s statement

Overview

We are building a business around the new science of network pharmacology. This science can be applied both to identify existing drug molecules that have unexpected potential for ‘repositioning’ into different disease areas and as a basis for inventing new drug molecules. We have taken two repositioned drugs into the clinic: ETS2101 is in phase I trials for cancer and ETS6103 will advance into phase IIb development for major depressive disorder in the next few weeks. We are seeking further candidates for cancer and central nervous system disorders at our network pharmacology centre near Oxford.

ETS2101 – cancer trials on track

Our phase I programme for ETS2101 includes a US trial in brain cancer and a UK trial in patients with a variety of solid tumours. Both have a dose-escalating design in which successive groups of patients receive higher doses of the drug in order to determine a maximum tolerated dose for use in subsequent studies. In May we reported that the trials had enrolled a total of 17 patients and that no serious drug-related adverse events had been recorded. One patient had experienced severe fatigue and continued on a lower dose of drug and one had shown a partial response according to RECIST, a standard method for assessing the impact of treatments on tumour burden (see Notes). At that time patients had received doses of ETS2101 up to 12 mg/kg body weight. The two trials have now enrolled 33 patients at doses up to 24 mg/kg. There have still been no serious adverse events related to treatment and no further cases of severe fatigue have been noted. The trials remain on track to complete their planned dose escalation steps and report key safety data in Q4 2013 (brain cancer) and Q1 2014 (solid tumours). If by these dates the trials have not identified a maximum tolerated dose, one or both may be extended by addition of one or two extra dose levels beyond those originally planned.

Provided the phase I data are supportive, we intend to move ETS2101 rapidly into further studies. We indicated previously that the next phase of development would likely include a randomised controlled phase II trial in one indication, probably glioma, in addition to a more exploratory phase Ib/II study in four to six other cancer types. We now plan to conduct phase Ib/II work in all of our priority indications so that we can consider data on ETS2101 in combination with standard-of-care treatments before launching a randomised trial in any particular setting. We intend to complete the programme of phase Ib/II and randomised phase II trials in time to conclude a potential licensing deal for ETS2101 within the lifespan of our existing cash resources.

We have begun a programme to evaluate an oral formulation of ETS2101, which might be preferable in some cancer settings to the intravenous formulation currently under evaluation. A phase I trial in healthy volunteers will begin shortly.

Pipeline progress and decisions

In the next few weeks we expect to initiate a phase IIb trial of ETS6103 in major depressive disorder. The trial has been approved by the UK MHRA (Medicines and Healthcare Products Regulatory Agency) but its start has been delayed by several months because the Agency required stability data on the special tablet-in-capsule form of ETS6103 used in the trial to blind patients to their treatment. The phase IIb trial builds on encouraging data from an earlier, small phase IIa study that compared ETS6103 with the approved tricyclic anti-depressant amitriptyline. Given the delay in starting we now expect to report results in the first half of 2015 rather than in the second half of 2014. We regard ETS6103 as a smaller commercial opportunity than ETS2101 but one that justifies the limited further investment needed to complete a proof-of-concept trial designed to demonstrate the product’s value to potential partners.

New tests on our preclinical anti-infective candidate ETX1153c have shown strong synergy between its two constituents, miconazole and nisin, against a wide variety of C. difficile strains including hypervirulent isolates. In addition, extensive testing suggested that it was very hard to induce any resistance to the drug. Despite these encouraging data we do not plan to take ETX1153c forward into clinical trials for C. difficile. Practical challenges in delivering the drug to its site of action in the bowel, together with our view that there will be a limited commercial opportunity for new entrants to the C. difficile market by the time these challenges are surmounted and trials completed, persuade us that there are better investment opportunities elsewhere in our portfolio. We will, however, evaluate some alternative ways to build directly on the positive results seen in our tests.

Platform key to development of portfolio

We continue to evolve our approach to drug discovery and are making significant progress in adding to and refining the techniques used in our network pharmacology platform and in identifying how best to apply these to therapeutic challenges. Some of our projects are based around repositioning of existing drugs and others are expected to produce new chemical entities. We have several discovery programmes in which multiple candidates have been generated and are under evaluation, although we are not yet ready to progress any of our leads into formal development. Our major goal is to ensure that we have a well-diversified portfolio of product assets by the time ETS2101 is scheduled to complete phase II development. With this in mind we are channelling additional investment into our discovery and informatics capabilities: we have just appointed four new scientists, all of whom will join our team by the end of 2013.

Strong balance sheet supports investment

Increasing investment in discovery and development increased our operating expenses from £2.3 million in the six months ended 31 July 2012 to £3.1 million in the six months to 31 July 2013. We had no revenues in the period (H1 2013: nil), but the offsetting impact of R&D tax credits receivable of £0.5 million (H1 2013: £0.3 million) and interest on our cash balances of £0.3 million (H1 2013: £0.1 million) limited our net loss to £2.3 million (H1 2013: £1.8 million).

In March 2013 we concluded an equity placing that raised £40 million through the issue of 125 million shares to new and existing investors at 32 pence per share. Net proceeds of £38.9 million are reflected in a greatly enhanced balance of £45.4 million of cash and short-term investments at 31 July 2013 (31 July 2012: £11.7 million; 31 January 2013: £9.8 million).

The Company’s strategy is to license its products to pharmaceutical companies for late-stage development and commercialisation. In addition, the Company may enter discovery collaborations with selected partners. We anticipate continuing losses until revenues from these sources exceed investment in R&D. Based on our latest projections, we expect to be able to support our discovery and development plans into calendar 2018 even in the absence of any income from partners. This should enable us to complete key efficacy-focused trials of ETS2101 and, if the data from those trials are positive, conclude a licensing deal for the drug.

Outlook

We look forward to reporting results from our phase I trials of ETS2101 over the next six months and are ready to take this drug rapidly into the next stage of trials if data are supportive. At the same time we are working to build a broader business with a diversity of product assets. We believe that continuing investment in network pharmacology-based drug discovery will lead to sustained value creation in our business over the medium and long term.

Professor Oliver James 
16 October 2013

Notes

About the RECIST criteria used to assess tumour responses

RECIST (Response Evaluation Criteria in Solid Tumours) provide a standardised way of assessing the response of solid tumours to treatment. Under the criteria, a partial response is recorded when the linear dimensions of the tumour lesions selected for measurement at the start of the study reduce by at least 30% from baseline and no new lesions appear.

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