On February 13, 2020 Sosei Group Corporation ("the Company") (TSE: 4565) reported an update on operational activities and reports its consolidated results for the twelve months ended 31 December 2019 (Press release, Sosei Heptares, FEB 13, 2020, View Source [SID1234554329]). The full report can be accessed by clicking here.
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Operational Highlights for Q4 2019
US$3 million payment received from Genentech – triggered by the nomination of a new GPCR disease target under the multi-target research collaboration and license agreement, signed in July 2019
Positive results announced from Phase III IRIDIUM study of QVM149 in patients with uncontrolled asthma announced by Novartis – QVM149 is an investigational, once-daily, inhaled combination treatment for asthma submitted for registration in Europe (Q2 2019) and Japan (Q3 2019) in which Sosei Heptares has an economic interest
US$5 million clinical milestone from Pfizer – triggered by Pfizer dosing the first subject in a clinical trial with a new drug candidate nominated from the multi-target drug discovery collaboration between the two companies
US$3 million pre-clinical milestone from Pfizer – payment resulted from the nomination of a third clinical candidate from the multi-target drug discovery collaboration between the two companies
Creation of Scientific Advisory Board (SAB) – new SAB includes experts from academia and the pharmaceutical industry in the US and Europe. The SAB will provide valuable insight and perspective relevant to strategic areas of focus for Sosei Heptares
Operational Highlights for the Full Year 2019
Two new multi-target collaborations initiated with major global partners – Genentech and Takeda – together, these collaborations are expected to generate up to US$52 million in the form of upfront and early progress payments over the next two to three years, with potential for significant future milestone payments plus royalties
Excellent progress with other partnered programs – AstraZeneca (AZD4635), Pfizer (two candidate nominations), Novartis (QVM149), all triggering progress-related milestones
Creation of two spin-out companies – Spin out of discovered assets (orexin agonists targeting neurological diseases) into Orexia Ltd and Inexia Ltd with funding of up to €40 million from Medicxi, an international investment firm focused on the life sciences sector. Significant progress, triggering release of funding, reported in January 2020
R&D Day for investors (September 2019) – successful event held in Japan showcasing the Company’s state-of-the-art UK R&D center, the potential of StaR technology and artificial intelligence in drug discovery and how this positions Sosei Heptares to continue delivering high-quality drug candidates, strategic partnerships and significant shareholder value
Financial Highlights for the 12-month Period ended 31 December 2019
Revenue totalled JPY 9,726 million (US$89.2 million) (an increase of JPY 6,176 million (US$57.0 million) vs. the prior corresponding period), and related primarily to strong growth in milestones, upfront fees from new partnerships plus royalty payments received.
Total cash operating expenses[1] were down to JPY 6,101 million (US$55.9 million) (an improvement of JPY 2,865 million (US$25.4 million) vs. the prior corresponding period), primarily due to a decrease in R&D costs.
Cash profit[2] totalled JPY 2,802 million (US$25.7 million) vs. a cash loss of JPY 5,704 million (US$51.7 million) in the prior corresponding period, as a result of strong revenue growth and tight cost management.
Net profit totalled JPY 1,432 million (US$13.1 million) vs. a net loss of JPY 6,919 million (US$62.7 million) in the prior corresponding period, on the back of strong business plan execution.
Term loan facilities were fully repaid in FY2019. New ¥5bn ($45m) commitment line (undrawn) established with Mizuho Bank provides financial flexibility for the future
The Company remains well capitalized, with Cash at Hand of JPY 15,375 million (US$140.3 million) as at 31 December 2019.
* Convenience conversion to US$ at the following rates: 2019: 1US$ =109.035 JPY; 2018: 1US$ =110.291 JPY