On March 25, 2021 Midatech Pharma PLC (AIM: MTPH.L; Nasdaq: MTP), a drug delivery technology company focused on improving the bio‐delivery and biodistribution of medicines, reported the Company has agreed non‐binding Heads of Terms for the co‐development of MTX110 and its unaudited headline results for the year ended 31 December 2020 (Press release, Midatech Pharma, MAR 25, 2021, View Source [SID1234577158]).

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MTX110 ‐ Non‐binding Heads of Terms
On 26 January 2021, the Company announced that it was engaged in tentative discussions with a third party around the potential co‐development of MTX110. These discussions have now advanced and a non‐binding Heads of Terms has been agreed.

The Heads of Terms envisage that, if the deal progresses to definitive agreements, the Company would expect to receive a modest upfront payment upon execution, success‐based development and sales milestones and royalties typical for a licensing agreement with products in a similar stage of development. R&D expenses would be assumed by the two parties with the apportionment to be agreed based on their respective territories. There can be no assurance on the timing for concluding these discussions nor any assurance that the parties will enter into definitive agreements. Further announcements will be made in due course, as appropriate.

Unaudited 2020 Headline Results
In March 2020, the Company announced a strategic review of its operations which led to the termination of further in‐house development of MTD201, closure of its Spanish subsidiary, Midatech Pharma España SL ("MPE"), and the MTD201 dedicated manufacturing facilities in Bilbao, Spain.

The closure of MPE resulted in an immediate halving of the Company’s cash burn rate and significant savings in R&D and administrative expenses going forward. Included in the unaudited headline results for 2020 are R&D expenses and administrative costs of £2.8 million and £1.1 million, respectively, in respect of MPE.

Also in connection with the termination of MTD201, the Company has recognised a non‐cash impairment loss in 2020 for in‐process development of £9.3 million and goodwill of £2.3 million. In addition, in connection with the purported termination of the Company’s licence for panobinostat from Secura Bio, Inc. in June 2020, the Company has recognised a non‐cash impairment of an intangible asset relating to the licence agreement of £0.8 million as of 31 December 2020.

Midatech’s headline unaudited results, including MPE, for the year ended 31 December 2020 compared with the prior yearare as follows:

Year ended 31 December

The Company expects to publish its audited results for the year ended 31 December 2020 by the end of April 2021.

The Company’s consolidated financial statements for the financial year ended 31 December 2020 (the "Period") are not yet available and our independent registered public accounting firm, Mazars LLP, has not completed its audit of the consolidated financial statements for the Period. The Company’s expectations with respect to its unaudited results for the Period are based upon management estimates. The estimates set forth in this announcement were prepared based upon a number of assumptions, estimates and business decisions that are inherently subject to significant business and economic conditions and competitive uncertainties and contingencies, many of which are beyond the Company’s control. This summary is not meant to be a comprehensive statement of Midatech’s unaudited financial results for the Period and the actual results may differ from these estimates.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014 (MAR).