Biodexa Pharmaceuticals Plc (formerly Midatech Pharma Plc) — FY2020 Form 20-F
Reporting period: Year ended December 31, 2020; this is an annual report, not a quarterly filing. Financial statements are prepared under IFRS as issued by the IASB and presented in pounds sterling. The company was an early-stage drug-delivery and development business, with no marketed products or recurring revenue at year-end.
Key financial results
| Metric | 2020 | 2019 |
|---|---|---|
| Revenue | £0.180m | £0.312m |
| Grant revenue | £0.163m | £0.362m |
| Total revenue including grants | £0.343m | £0.674m |
| Research and development costs | £6.068m | £7.843m |
| Loss from operations | £23.040m | £11.318m |
| Net loss | £22.189m | £10.085m |
| Cash used in operating activities | £9.301m | £6.489m |
| Cash and cash equivalents at year-end | £7.546m | £10.928m |
| Total assets | £9.817m | £30.895m |
| Total liabilities | £3.099m | £11.337m |
| Total equity | £6.718m | £19.558m |
Operating margins are not meaningful given the company’s minimal service revenue and development-stage model. Borrowings were £0.260m at year-end, including lease liabilities and government/research loans; a separate £1.559m derivative financial liability related principally to warrants. Current assets were £9.275m and current liabilities £2.989m. Accumulated deficit was £122.432m.
Material changes and unusual items
- Total revenue including grants fell about 49% year over year. Service revenue declined from £0.312m to £0.180m; grant revenue declined from £0.362m to £0.163m.
- Net loss increased to £22.189m, principally reflecting £12.369m of non-cash intangible-asset and goodwill impairment charges. These included £9.3m related to MTD201/Q-Sphera, £2.3m of goodwill, and approximately £0.8m related to MTX110.
- R&D expense fell 23% to £6.068m as MTD201 spending was reduced, partly offset by redundancy costs and accelerated depreciation related to the Bilbao closure. Administrative costs rose 29% to £4.952m.
- Cash declined by £3.643m during 2020, compared with an £8.437m increase in 2019. Financing activity included £9.742m of net proceeds from share issues and warrants; the 2020 financings substantially increased the share count and created further potential dilution.
- The company terminated further in-house development of MTD201, closed its Bilbao manufacturing operations and reduced headcount. It repaid most Spanish government loans; £0.119m remained at year-end and was repaid in February 2021.
Outlook, risks and contingencies
- Going concern and funding: Management said year-end cash was expected to fund planned operations into Q4 2021, but forecasts required additional financing during the following 12 months. The auditor highlighted a material uncertainty that raises substantial doubt about the company’s ability to continue as a going concern; the audit opinion was not modified. Funding options included equity fundraising, partnering assets or technologies, and asset or company sale.
- Strategy and pipeline: Following completion of its strategic review in January 2021, the company focused on advancing products toward proof of concept and seeking partners to fund later development and commercialization. It generally did not plan additional human trials without partner or grant funding, except for MTX110 studies.
- MTX110: A Phase I study at UCSF in seven DIPG patients met its primary endpoint. The filing reported median overall survival of 26.06 months and 71.4% survival at 12 months at an interim cutoff; the small patient group and interim analysis limit interpretation. A Phase II study was planned. Secura Bio had sent a letter purporting to terminate the panobinostat license, which Midatech disputed; the outcome could materially affect MTX110.
- Potential partnership: In March 2021, the company reported non-binding heads of terms for possible MTX110 co-development. Any upfront payment, milestones, royalties, cost allocation and definitive agreement remained uncertain.
- Other risks: The filing identifies clinical and regulatory uncertainty, reliance on collaborators and third-party manufacturers, COVID-19-related trial and supply disruption, Brexit-related regulatory changes, foreign-exchange exposure, intellectual-property risks, potential shareholder dilution and Nasdaq listing compliance.
- Other contingencies: A €149,835 Spanish tax-authority fine received in February 2021 was being appealed; the company considered it unfounded. The filing states the liability was recognized. No contingent liabilities were reported at December 31, 2020.
- Controls: Management concluded disclosure controls and internal control over financial reporting were effective as of year-end after remediation measures. Prior material weaknesses had been identified; the company was not required to obtain an auditor attestation of internal controls.
Most important facts for investors to verify
- Subsequent cash, financing, operating runway and any developments affecting the going-concern uncertainty.
- Status and terms of any definitive MTX110 partnership, and the legal outcome and development impact of the Secura Bio license dispute.
- Progress, enrollment, safety and follow-up results in MTX110 clinical studies, particularly the planned DIPG Phase II study.
- Whether the post-review pipeline and partnering strategy can generate funding or recurring revenue, and whether additional impairments or restructuring costs arise.
- Actual dilution from outstanding warrants, options and any further equity financing; also confirm the appeal outcome for the Spanish fine.