BTG plc: 2007 Annual General Meeting and Interim Management Statement

BTG plc: 2007 Annual General Meeting and Interim Management Statement

BTG plc: 2007 Annual General Meeting and Interim Management Statement

London, UK, 18 July 2007: BTG plc (LSE: BGC), the life sciences company, today issues the following AGM and Interim Management Statement, which is a summary of comments to be made by Sir Brian Fender, Chairman, and Dr Louise Makin, Chief Executive Officer, at the company’s AGM at 10.30am today.

The Group reported strong results for the year ended 31 March 2007. Increased recurring royalties from licensed products and good realisations from the divestment of non-core IP together with reduced operating and administrative costs have enabled the Group to report a second consecutive year of profits. There was good progress both in BTG’s internal pipeline of pharmaceutical programmes and in its licensed programmes.

Since year-end, BTG has continued to make good financial and operating progress in the year to date, in line with Board expectations. As part of the divestment programme, two licences were granted for patents relating to storage capacity in semiconductor chips, generating $44m in gross income plus an additional $22m if an option is exercised and other conditions are satisfied. In addition, an agreement to grant exclusive worldwide rights to the experimental cancer treatment AQ4N was signed with KuDOS Pharmaceuticals Ltd and Novacea, Inc. These deals have generated approximately £11m net of costs and taxes in the current financial year.

The Group is actively seeking additional licensees for the semiconductor IP and for its remaining physical sciences technologies. It is also seeking development and commercialisation partners for a number of pharmaceutical programmes including plevitrexed, which was recently granted orphan drug status in the US for ovarian and gastric cancer.

There is good momentum in the internal development pipeline, which comprises ten full development programmes, of which four are undergoing clinical trials, plus four additional research programmes.

BGC20-1259, under development for dementia, completed a Phase I study. The drug was well tolerated and has been shown in this and other studies to occupy key molecular targets associated with cognitive improvement and the alleviation of depressive symptoms. In addition, although the study was not powered to demonstrate statistically significant changes in cognition in the healthy young and elderly volunteers, there were significant dose-related improvements in self-assessed calmness, power of attention and quality of working memory. These encouraging results are planned to be explored in a Phase IIa study in people with Alzheimer’s disease, which is anticipated to start in the second half of this financial year.

BGC20-0134, a structured lipid for the treatment of multiple sclerosis, and BGC20-1531, an EP4 receptor antagonist for migraine, both continued through late preclinical development ahead of their first Phase I studies, which are scheduled to commence towards the end of 2007. BGC945 also continued to progress through preclinical development and is anticipated to enter Phase I studies in the first half of 2008.

A Phase II study of BGC20-0582, a proprietary formulation of a GRAS (generally regarded as safe) compound for head lice, is expected to start in late summer 2007, with the results due before the end of the calendar year.

A third centre has started recruiting patients for the Varisolve® US Phase II safety study. This is on track to complete treatment and follow-up of 50 patients around the end of the financial year.

Progress is also anticipated in several licensed programmes. The approval of Genzyme Corporation’s sBLA for Campath® as a first-line treatment for chronic lymphocytic leukaemia (CLL) would significantly increase the number of CLL patients available for treatment with Campath®. Genzyme also expects by the end of 2007 to commence two pivotal Phase III trials of Campath® in multiple sclerosis following the excellent efficacy results in Phase II.

Tolerx, Inc. is continuing with a dose-optimisation Phase II study of TRX4, a monoclonal antibody for the treatment of type 1 diabetes, ahead of a Phase III study planned to begin before the end of the year.

The Group’s financial position is strong, with the revenues earned to date from one-off transactions, the anticipated continued steady growth in recurring royalty revenues and a healthy cash balance. This will enable investment in R&D to increase as planned to around £15-16m this year to expand and further develop the Group’s pipeline of pharmaceutical products. Overall, the financial and operating performance of the Group is expected to be in line with internal expectations.

Louise Makin, Chief Executive Officer, commented:

“We have made a strong start to the year. With £11m generated in one-off revenues already, continued steady growth anticipated in our recurring royalties and a healthy cash position, we can progress our current development programmes and explore options to strengthen our pipeline further.”

“Building value in our pipeline is the key route by which we will create shareholder value. We look forward to reporting significant progress during the remainder of the year, including the progression of several programmes into Phase I studies, the start of two Phase II studies, the completion of our Varisolve® and head lice Phase II studies and the completion of the proof of mechanism sleep apnoea clinical study. We believe we are well positioned to become a leading life sciences company and to create significant shareholder value.”

For further information contact:
Andy Burrows, Director of Investor Relations
+44 (0)20 7575 1741; mobile: +44 (0)7990 530605
Christine Soden, Chief Financial Officer
+44 (0)20 7575 1591

Financial Dynamics
Ben Atwell/Anna Keeble
+44 (0)20 7831 3113


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