XLON:HEMO ESEF Annual Report
HEMOGENYX PHARMACEUTICALS PLC (XLON:HEMO)
ESEF Annual Report
2022-04-29
For: 2021-12-31
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Added on
October 03, 2026
Annual Report & Financial Statements for
the Year Ended 31 December 2021
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
Contents
Page
Company Information 1
Chairman’s Statement 3
Board of Directors and Senior Management 8
Strategic Report 10
Directors’ Report 18
Governance Report 24
Directors’ Remuneration Report 31
Independent Auditor’s Report 37
Consolidated Statement of Comprehensive Income 44
Consolidated Statement of Financial Position 45
Company Statement of Financial Position 46
Consolidated Statement of Changes in Equity 47
Company Statement of Changes in Equity 48
Consolidated Statement of Cash Flows 49
Company Statement of Cash Flows 50
Notes to the Financial Statements 51
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Company Information
Directors
Dr Vladislav Sandler (Chief Executive Officer)
Professor Sir Marc Feldmann (Chairman)
Alexis Sandler (Non-Executive Director)
Peter Redmond (Non-Executive Director)
Company Secretary
Andrew Wright
Registered Office
5 Fleet Place London
EC4M 7RD
Registered Number (England and Wales )
08401609
Joint Brokers
SP Angel Corporate Finance LLP
Prince Frederick House
35-39 Maddox Street
London
W1S 2PP
Peterhouse Capital Limited
80 Cheapside
London
EC2V 6EE
Independent Auditor
PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
Canary Wharf
London
E14 4HD
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UK Solicitors
Cooley (UK) LLP
Dashwood
69 Old Broad Street
London
EC2M 1QS
US Solicitors
Rubin & Rudman LLP
50 Rowes Wharf
Boston
Massachusetts 0211
Principal Bankers
Metro Bank plc
One Southampton Row
London
WC1B 5HA
Registrar
Computershare Investor Services plc
The Pavilions
Bridgwater Road
Bristol
BS13 8AE
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Chairman’s Statement
We achieved significant progress in our lead projects in 2021, having decided to focus on those
developments which we felt promised progression to human trials or other milestones most quickly. Key
to this was the work we have done on our CAR-T cell therapy for blood cancers, while we have also
taken our CDX antibody project forward following completion of the work carried out by Eli Lilly and
Company (“Lilly”) and the signing of a licensing agreement with Lilly for intellectual property developed
by it. Building on lines of research we had been developing previously, we have also filed a provisional
patent application for our Chimeric Bait Receptor (“CBR”) platform technology, a novel approach which
potentially has the capacity to cure most viral infections, both known and yet to appear, and certain
cancers.
As a result of this programme of activity and outstanding scientific work the Company now has a strong
roster of assets, and is firmly on the path to taking them to market.
Financially, as the accounts show, our operating loss rose to approximately £2.7 million over the period,
up from approximately £2.2 million in 2020. Operating costs remained very low for a biotechnology
company developing such cutting-edge assets as ours, but we have made strong progress largely thanks
to the quality and effectiveness of our scientific team and the expertise of our consultants.
Overall, however, the Group made a loss of £5,108,310 (2020: £2,095,023 loss) during the period under
review. Approximately half this figure arose in connection with the convertible loan facility through
which we raised £12 million during the period, which consisted in part of introductory, legal and exchange
listing fees, and in part of the discount on the market value of the shares issued upon conversion of the
debt to shares; this latter component is a non-cash loss arising for accounting reasons and contributed to
the increased reported loss for the year.
The convertible loan facility did not operate as we expected. Consequently, we decided to terminate the
facility through a partial repayment and replacement of the facility balance with conventional equity,
thanks to the efforts of our brokers. While this has proved to be expensive and our share price has fallen
back substantially, conventional sources of finance on this scale were not available at the time and these
arrangements have crucially enabled us to raise sufficient funds to take our key projects significantly
forward and to bring our lead CAR-T product candidate close to being ready, subject to the work now
being carried out, for human trials in the coming months.
I review progress and developments on our lead projects below. I shall refer to our other projects more
briefly, with the reasons for the priorities that we have selected.
CAR-T cell therapy
Our chimeric antigen receptor T-cells are developed to be a treatment for relapsed/refractory (“R/R”)
Acute Myeloid Leukaemia (“AML”), the most common form of leukaemia and one for which there are
currently no fully effective treatments. AML has a five-year survival rate of less than 30% in adults and
is currently treated using chemotherapy, rather than the potentially more effective form of therapy being
developed by Hemogenyx Pharmaceuticals.
Our CAR-T therapy is expected to be a novel form of immunotherapy that programmes a patient’s own
T-cells to recognise an antigen expressed by cancerous cells and hence destroy these cells. The product
we are developing, which we refer to as HEMO-CAR-T, was constructed using our proprietary humanised
monoclonal antibody against a target, the FLT3 protein, that is over-expressed in AML cells and can be
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found on their surface. Testing has demonstrated that HEMO-CAR-T is able to effectively programme
human T-cells to identify and destroy human AML-derived cells both in vitro (in non-animal studies) and
in vivo (in animal studies).
We have made strong progress over the past two years in the development of HEMO-CAR-T. The
programme has seen very encouraging results to date and promises to represent a major breakthrough in
the treatment of AML. The Company is now focusing its greatest efforts on this asset, which remains
proprietary and wholly owned by the Company.
In January 2021, we announced that we had entered into a Master Translational Research Services
Agreement with the University of Pennsylvania (“Penn”) to advance HEMO-CAR-T toward and through
clinical trials. The collaboration with Penn, the world’s leading experts in CAR-T therapies, is of vital
importance and demonstrates the potential value of our development. The intended outcome of the
relationship is clinical proof of concept for HEMO-CAR-T.
In preparation for human trials, the Company engaged Quality Systems LLC (“Quality Systems”) to
oversee chemistry, manufacturing and controls processes and to assist with the compilation of regulatory
filings. Quality Systems is an expert in this field and has taken more than 30 cell and gene-based therapies
to Phase I/II of clinical trials.
In December 2021, we engaged leading contract manufacturing organisation WuXi Advanced Therapies
ATU (“WuXi ATU”) for product development and manufacturing of the DNA plasmids and viral vectors
required to manufacture HEMO-CAR-T cells to support Phase I clinical trials. This partnership is key in
accelerating the timeline to deliver this innovative therapy to patients in need of a more effective treatment
for AML. Work on these precursors for the creation of HEMO-CAR-T is now well advanced.
We are now at an advanced stage of completing our application for Investigational New Drug (“IND”)
status. Work on manufacturability, quality, safety and other key parts of the development of HEMO-CAR-
T has continued and we expect to be in a position scientifically to commence trials once the IND
designation has been granted.
CDX antibody
CDX is a bispecific antibody targeting a majority of forms of relapsed/refractory AML, a subset of ALL,
and myelodysplastic syndrome; it may also be used in conditioning patients for bone marrow transplants
in a more benign way compared to traditional chemotherapy and/or radiotherapy protocols. CDX was the
subject of our development collaboration with Lilly which concluded in 2021. The partnership resulted
in the selection of a clone of the antibody that is ready for IND-enabling studies, the final step before
applying for a licence to conduct clinical trials.
Effective and non-toxic conditioning may extend the use of bone marrow transplantation to older and
more frail patients and potentially target additional indications including autoimmune diseases, such as
lupus and multiple sclerosis, for which the risk of conventional bone marrow transplantation has been a
major road-block.
The potential applications of the CDX antibody have far wider potential than initially anticipated, and we
now believe that CDX may be used not only for conditioning for bone marrow transplants but also as a
direct treatment, or when used in combination with other existing treatments, for AML and other blood
cancers.
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In October 2021 we secured an exclusive worldwide licence for all applications to intellectual property
developed by Lilly related to the final form of the CDX bispecific antibody. With patent protection now
secured (as described below), and following the valuable contributions made by Lilly, we believe that
CDX should attract significant interest from financial or strategic partners in taking the asset forward to
animal toxicology studies and ultimately clinical trials.
Following the year end, in January, the Company announced a partnership with Selexis SA (“Selexis”)
to leverage Selexis’s SUREtechnology Platform™ of protein expression technologies and modular
workflows to advance the Company’s CDX bispecific antibody toward human trials. The service
agreement will help the Company to reduce the time, effort, and costs associated with developing the cell
line for the antibody for the treatment of AML.
CBR
CBR is a novel platform technology that constitutes a new paradigm for treating viral infections and some
forms of cancer. The Company has been working on CBR since before the start of the COVID-19
pandemic, leveraging prior discoveries by the Company, and we have made considerable progress over
the course of 2021.
The essence of the CBR-based approach is to programme immune cells to destroy pathogens using a
novel type of modifiable synthetic receptor. We have ascertained that this approach can also potentially
be used to destroy malignant cells causing certain types of cancer, making it a broadly applicable and
exciting new class of therapy. Detailed work has been undertaken by our scientists to prove the efficacy
and widen the scope of the platform. We have achieved laboratory proof of concept for a CBR construct
that eliminates the SARS-CoV-2 virus responsible for COVID-19. The Company is planning to conduct
in vivo tests of the anti-SARS-CoV-2 CBR construct. Work also continues on a CBR construct for cancer.
Although work to date has been focussed on specific viruses, in particular SARS-CoV-2, the CBR
approach is applicable in principle to almost any form of virus. We believe it is likely to be of particular
value in combatting emerging or rare forms of viral infection, treating sufferers where effective vaccines
or anti-viral drugs have not yet been developed or have failed to be effective. These may include future
mutations of the SARS-CoV-2 virus and also new viruses that may cause new pandemics, referred to as
“Disease X”, which scientists have warned to be highly likely in the coming years.
Major advantages of our CBRs for combatting viral infections are: (1) the use of a bait makes CBRs
insensitive to mutations of the targeted virus, preventing the development of resistance; (2) CBRs are
made from naturally occurring receptors that are responsible for the function of immune cells and endow
the host’s own immune system with the ability to destroy invading pathogens; and (3) CBRs are modular
synthetic receptors that can be rapidly reconfigured to attack almost any virus, bacteria, or malignant
cells.
The Company has said relatively little about its work on CBR to date as it is a potentially broadly
applicable and highly valuable new method of creating immunotherapy treatments that is not comparable
to any other developments taking place, as far as we are aware. Now that we have achieved proof of
concept and a provisional patent application has been filed in relation to CBR we can consider business
development options. We believe that the technology should attract interest from a range of potential
partners with whom we can now hold more substantive conversations.
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Other assets
The Company’s portfolio also includes its licence to the Hu-PHEC cell therapy approach that was the
subject of CEO and Co-founder Dr Vladislav Sandler’s original discovery while working at Cornell
University, and its Advanced Hematopoietic Chimera (“AHC”) humanised mice that uniquely do not
suffer from graft-versus-host disease. These remain potentially valuable assets. Some work continues in
the background, including collaborations using our AHC as platforms for disease modelling. Shareholders
will be aware that we entered into joint ventures in 2018 to take these projects forward but these were
ultimately without result and the convertible loans to subsidiaries associated with them were repaid during
2021. However, our pragmatic focus has been on our lead assets and on becoming a clinical trial-stage
business.
Patents
The Company continued to strengthen the legal protection of its pipeline assets through 2021.
In June 2021, the Company received US patent approval in relation to CDX, covering its method of use
for conditioning patients for bone marrow/hematopoietic stem cell transplantation. It also covers a subset
of sequences of monoclonal antibodies against target proteins existing on the surface of hematopoietic
stem cells/hematopoietic progenitors and/or a number of leukaemias. This patent solidifies the
Company’s leading position in the development of ground-breaking cancer-related therapies and protects
the Company’s intellectual property in this key asset.
In August 2021, the Company received US patent approval covering sequences of monoclonal antibodies
to the human FLT3/FLK2 receptor protein that is found on the surface of AML cells, hematopoietic (blood
forming) stem cells and progenitors, and dendritic cells. These monoclonal antibodies have allowed the
Company to develop both the bispecific CDX antibody and HEMO-CAR-T as treatments for AML as
well as potential treatments for other types of blood cancers, and CDX as a product for bone marrow
transplant conditioning.
The Company has made further patent applications in relation both to HEMO-CAR-T and to the CDX
bi-specific antibodies, the latter being a joint application with Lilly.
Following the period covered by these accounts, in March 2022, the Company filed a seminal provisional
patent application protecting its intellectual property rights in its CBR platform, as mentioned above.
Scientific and business advisers
The scientific advisory board, which I chair, continues to provide valuable guidance to the Company and
its scientists. During 2021 and into 2022 it has been particularly useful in shaping the Company’s intended
protocol for clinical trials of its CAR-T therapy, leveraging our advisers’ extensive experience. The
Company has now also bolstered its commercial expertise through the appointment in July 2021 of Dr
Alan E. Walts as a business adviser and board observer on an initial 12-month term. Dr Walts is a highly
qualified life sciences industry veteran, having served as a senior manager at Genzyme in a career there
lasting over 25 years. He is now a Venture Partner with Advent Life Sciences, a position he has held since
January 2014, and has positions with several other public, private and charitable life sciences
organisations. Dr Walts’s input has been instrumental in shaping the Company’s strategy for developing
its pipeline of assets, and in introducing the Company to several potential partners.
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New laboratory premises
The Company recently occupied new premises in the Manhattanville Factory District of New York. The
premises, custom built to our requirements, are significantly larger than our original laboratory and
include two clean rooms, enabling us to carry out some procedures which we have until now had to
outsource to third parties. These will commence with the manufacturing of HEMO-CAR-T cells for
clinical trials in-house, a process that alone can save the Company over US$2 million compared with
outsourcing this work. They also open up the possibility of manufacturing cells for other organisations as
a potential source of revenue. The new laboratory will enable us to grow as we proceed to clinical trials
and commercialisation of our pipeline products, and has other advantages including proximity to
Columbia University and other life sciences institutions. It is gratifying that the Company’s highly
talented and dedicated scientific team now has the space and quality of facilities that it needs to further
its crucial work.
Conclusion
Overall, 2021 was an important year for Hemogenyx Pharmaceuticals in terms of product development
and strategic focus, and the present year has continued this positive progress. It remains for me to thank
our expert and committed team of scientists and our informed and influential group of scientific and
business advisers. We particularly look forward to taking our key CAR-T project toward human trials and
to seeking partnerships and other financing arrangements to further the development of our CDX and
CBR assets over the rest of 2022.
Prof Sir Marc Feldmann AC, FRS
MB BS, PhD, FRCP, FRCPath, FAA, F Med Sci
Chairman
29 April 2022
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Board of Directors and Senior Management
Professor Sir Marc Feldmann – Non-Executive Director & Chairman – appointed 9 April 2018
Professor Sir Marc Feldmann is a pre-eminent medically trained immunologist at the University of
Oxford where he was Head of the Kennedy Institute of Rheumatology until 2014 and now Emeritus
Professor. He trained in medicine at Melbourne University and then earned a Ph.D. in Immunology at the
Walter & Eliza Hall Institute with Sir Gus Nossal, before working in London at the Imperial Cancer
Research Fund. Sir Marc's main research interests are immunoregulation, understanding mechanisms of
autoimmunity and the role of cytokines in disease, and working out how to fill unmet medical needs.
His work in London led to the generation of a new hypothesis for the mechanism of autoimmunity, linking
upregulated antigen presentation and cytokine expression. Testing this hypothesis led to the discovery,
with colleague Sir Ravinder Maini, of the pivotal role of TNFα (Tumour Necrosis Factor alpha) in the
pathogenesis of rheumatoid arthritis. This major discovery has revolutionised therapy not only of
rheumatoid arthritis but other chronic inflammatory diseases (e.g. inflammatory bowel disease, psoriasis,
and ankylosing spondylitis), and helped change the perception of monoclonal antibodies from niche
products to mainstream therapeutics. Anti-TNF therapeutics are the current leading drug class with 2016
sales exceeding US$36 billion.
This has led to much scientific recognition, for example election to the Royal Society and Academy of
Medical Sciences in London, the National Academy of Sciences USA and the Australian Academy of
Science, and multiple major International prizes including the Crafoord Prize of the Royal Swedish
Academy of Sciences, the Albert Lasker Clinical Research Award (NY), the Ernst Schering Prize, the
Paul Janssen Award for Biomedical Research, and the Canada-Gairdner Award. He was also the first
recipient in biology or medicine of the EU/European Patent Office Inventor of the Year Award in the
Lifetime Achievement category. In addition, Sir Marc has advised more than 20 of the largest
pharmaceutical and biotech companies in the world and has mentored some of the most successful
scientists, many of whom have become senior figures in the commercial pharmaceutical world. Sir Marc
was knighted in the 2010 Queen's Birthday Honours, and was honoured in Australia with the knighthood
equivalent, the Companion of the Order of Australia.
Sir Marc has been at the forefront of promoting effective scientific-medical-pharmaceutical interactions.
He has built up a huge network of friends and collaborators who meet regularly in Oxford and who will
help Hemogenyx Pharmaceuticals to grow and enter clinical trials.
Dr Vladislav Sandler – Chief Executive Officer – appointed 4 October 2017
Dr Vladislav Sandler is the Co-Founder and CEO of Hemogenyx Pharmaceuticals and a research
Assistant Professor at the State University of New York (SUNY) Downstate. Dr Sandler is a widely
published stem cell scientist with decades of experience in scientific research. In particular, Dr Sandler
has extensive experience developing novel methods of direct reprogramming of somatic cells into
functional and engraftable hematopoietic stem cells, as well as developing novel sources of pluri- and
multi-potent cells.
Dr Sandler has conducted his research in Russia, Israel, Canada and the United States, including at the
Children's Hospital at Harvard Medical School, the Salk Institute for Biological Sciences, Harvard
University and Albert Einstein College of Medicine, among others. He also led a team of scientists at
Advanced Cell Technologies, Inc. and was most recently on the faculty of Weill Cornell Medical College.
While at Cornell, Dr Sandler made the significant discovery that the cells that give rise to blood stem
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cells during mammalian development continue to exist after birth, and he developed the method of
isolation of these cells from humans. As a result of this important work, Dr Sandler was awarded the
inaugural Daedalus Fund Award for Innovation at Cornell. He went on to found Hemogenyx
Pharmaceuticals in order to further pursue this significant scientific discovery and his dedication to the
translation of science into clinical practice.
Dr Sandler has published numerous peer-reviewed papers and has received a number of awards and
fellowships for his scientific research. Dr Sandler received his PhD from the University of British
Columbia. He is a member of the International Society for Stem Cell Research.
Alexis Sandler – Non-Executive Director – appointed 4 October 2017
Alexis M. Sandler is the co-founder of Hemogenyx Pharmaceuticals, for which she has served as the
Chief Operating Officer. Ms Sandler is an attorney specialising in intellectual property, with 20 years of
experience representing a range companies and institutions.
Ms Sandler is the Vice President and General Counsel of Pace University. A talented and respected
attorney with a wide range of experience and expertise, Ms Sandler previously served for nearly a decade
as in-house counsel for The Museum of Modern Art. Prior to that, she worked as the director of business
and legal affairs for a major media and entertainment company, and in private practice for several
prominent law firms.
Ms Sandler received her AB from Harvard University and her JD from the UCLA School of Law and is
a member of the State Bar of New York and the State Bar of California.
Peter Redmond – Non-Executive Director – appointed 4 October 2017
Peter Redmond is a corporate financier with some 40 years’ experience in corporate finance and venture
capital. He has acted on and assisted a wide range of companies to attain a listing over many years on the
former Unlisted Securities Market, the Main Market of the London Stock Exchange and AIM, whether
by IPO or in many cases via reverse takeovers, across a wide range of sectors, ranging from technology
through financial services to natural resources and, in recent years has done so as a director and investor
of the companies concerned.
He was a founder director of Cleeve Capital plc (now BigBlu Operations Limited) and Mithril Capital
plc, both formerly listed on AIM prior to reverse takeovers, and of Silver Falcon plc, the Company into
which Hemogenyx Pharmaceuticals reversed, and he took a leading role in negotiating and effecting the
reverse takeover. He undertook the same role in the rescue, reconstruction and refinancing of AIM-quoted
3Legs Resources plc (now SalvaRx Group plc) and now Standard Listed URA Holdings plc and several
other companies, and took a significant active part in fundraising for the above companies.
He is currently a director of Standard Listed URA Holdings plc.
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Directors’ Strategic Report for the year ended 31 December 2021
The Directors present their Strategic Report of Hemogenyx Pharmaceuticals plc for the year ended 31
December 2021.
Introduction
This Strategic Report comprises a number of sections, namely: the Group’s objectives, the Group’s
strategy and business model, a review of the Group’s business using key performance indicators, and the
principal risks and uncertainties facing the business. The disclosures under s172 of the Companies Act
2006 are included in the Governance Report.
Objectives
The Group’s objective is to develop breakthrough therapies for the treatment of blood and autoimmune
diseases and of viral infections.
Strategy and Business Model
The Group’s long-term strategy is to create a suite of products to address current problems associated
with the treatment of blood disorders such as cancers and autoimmune diseases, with viral infections, and
with bone marrow – or hematopoietic stem cell – transplants. The latter represents an important part of
the solution to treating blood-related diseases, with the opportunity to improve outcomes through reduced
blood stem cell transplant rejection and relapse, and if successful potentially provides long-term cures for
these diseases.
The Group’s business model aims to advance its therapies through clinical proof-of-concept, taking them
towards a final stage of development. A goal is the licensing of one or more of its therapies to partners in
return for potential upfront payments, research funding support, success milestone and royalty payments.
Operational Review and Outlook
The operational review and outlook are set out in the Chairman’s Statement.
Financial Review
The Group incurred a loss for the year to 31 December 2021 of £5,108,310 (31 December 2020 – loss
of £2,095,023).
In the year to 31 December 2021 the loss mainly arose from operational expenses pursuing the Group’s
objectives listed above as well as salaries, consulting and professional fees, and general administration
expenses. These expenses have been met from the proceeds of the issue of convertible loans and equity
placings. The Group received other income of £99,943 (2020 – £85,237) from collaborations with
partners, and £71,932 (2020: nil) from the forgiveness of a loan under the United States Payment
Protection Program in 2021 for a total of £171,875 (2020 – £85,237). Finance costs connected with the
convertible loan arrangement have been expensed to profit or loss in ull in the year, following the
cessation of that acility, which would otherwise have been deferred and spread over the life of the
convertible loans.
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Cash flow and cash position
Cash used in operations totalled £2,627,298 (31 December 2020: £1,798,404).
As at 31 December 2021, the Group had a cash balance of £6,840,969 (31 December 2020: £1,812,299).
Key Performance Indicators
The Directors have identified the KPIs below that they feel are the most vital measurements for the Group
to monitor given its current stage of development. KPIs are monitored on an annual basis to ensure that
they remain the most important and relevant measure of performance and progress.
Cash management
The Group supplemented its funding with proceeds totalling £12,000,000 resulting from the issuance of
convertible loans that took place in the year. The lender converted £10,400,000 of such loan into shares
of the Company and we repaid the remaining £1,600,000. We also repaid loans to Orgenesis Inc. during
2021, such that at 31 December 2021 there was no outstanding indebtedness. The cash position at 31
December 2021 was £6,840,969 (31 December 2020: £1,812,299).
The Group carefully plans expenditure with rolling cash flow forecasts and tight financial control. The
Group takes a collaborative cost sharing approach with business partners and avoids long-term
commitments as far as possible.
Intellectual property
The Group will focus on developing new conditioning treatments, drugs and cell therapy products for
blood and autoimmune diseases, HSC/BM transplantation, and viral infections. The Group, or its
licensors, has applied for patents to protect its proprietary technology and future products, which are in
varying stages of development.
The success of the Group will depend largely on the Group’s ability to implement successful drug
development programmes, obtain the required regulatory approvals (in various territories), protect and
exploit its own intellectual property and know-how, and the intellectual property and know-how licensed
to it, and to generate a cash flow in accordance with the strategy of the Group. Intellectual property is
protected by the Group through taking a pro-active approach to filing patents over its products and
technologies, as well as the diligent maintenance and protection of such patents and licences.
The Group patent portfolio currently includes:
CDX bi-specific antibodies
The patent application relating to CDX bi-specific antibodies was filed by Hemogenyx Pharmaceuticals
LLC in the USA on 4 April 2016 ("CDX Patent") and awarded as Patent Number US 11,021,536 B2 on
1 June 2021. The invention summarised in the patent application is a method of eliminating hematopoietic
stem cells/hematopoietic progenitors ("HSC"/"HP") in a patient using bi-specific antibodies specifically
binding to a protein predominantly expressed on the surface of HSC/HP and to a protein uniquely
expressed on a surface of immune cells. The bound bi-specific antibodies redirect immune cells to
eliminate HSC/HP. The invention relates to the required conditioning of a patient prior to a BM/HSC
transplant. In this respect, the invention serves two main purposes:
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▪ it provides adequate immunosuppression of the patient and clears sufficient niche space in the
bone marrow for the transplant of HSC. This allows transplanted cells to engraft in the recipient;
and
▪ it could potentially help to eradicate the source of malignancy.
On April 4 2017, a PCT (Patent Cooperation Treaty) application was filed by Hemogenyx
Pharmaceuticals which includes additional claims that extend the CDX Patent set out in the provisional
patent application. These claims protect specific sequences of several high-quality clones discovered and
validated by the Group. The claim extension transforms the original "method" provisional patent
application into a "composition of matter" PCT application. An additional composition of matter patent
application (covering novel sequences of the antibodies discovered and validated by the Company in
collaboration with Lilly) has been filed following completion of the Lilly collaboration agreement.
Monoclonal antibodies
In July 2019 the Group filed a composition of matter patent application entitled MONOCLONAL
ANTIBODIES TO HUMAN FLT3/FLK2 RECEPTOR PROTEIN in relation to newly-discovered
monoclonal antibodies against a target protein expressed on the surface of hematopoietic stem
cells/hematopoietic progenitors and a number of leukaemias, such as AML. The patent was granted on
31 August 2021 as Patent Number US 11,104,738. This patent covers composition of matter (sequences)
of monoclonal antibodies to the human FLT3/FLK2 receptor protein that is found on the surface of acute
myeloid leukemia (AML) cells, hematopoietic (blood forming) stem cells and progenitors (HSC/HP),
and dendritic cells. It also covers a method of application of the Group’s bi-specific CDX antibodies for
conditioning patients for bone marrow transplantation.
Hu-PHEC cell therapy
The patent relating to Hu-PHEC was filed by Cornell University ("Cornell Patent") in several
jurisdictions on 13 November 2014. The patent was approved and issued in the United States of America
on 25 February 2020 and published by the European Patent Office on 13 May 2020. The invention
summarises a method of isolation and identification of post-natal hemogenic endothelial cells, as well as
the provision of substantially purified populations of post-natal hemogenic endothelial cells,
compositions of post-natal endothelial cells and methods to utilise post-natal hemogenic endothelial cells
to regenerate the hematopoietic system in a patient.
Advanced Hematopoietic Chimeras
The provisional patent application relating to the Group’s proprietary humanised mouse model, the
Advanced Hematopoietic Chimera, is an application filed by Dr Sandler and Dr Rita Simone in the USA
on 20 February 2018 ("AHC Patent"). The invention summarised in the patent application is mice whose
hematopoietic system is at least 40% humanised and methods for preparing the same. The patent was
assigned to the Group’s subsidiary Immugenyx LLC on 24 May 2018. In June 2019 the Group announced
that Immugenyx LLC has further refined its work to develop the Advanced peripheral blood
Hematopoietic Chimera ("ApbHC") as a research and development tool. The major advantage of the
ApbHC compared to other humanised mouse models known to the Group is the absence of Graft versus
Host Disease, a disease that complicates and often renders impossible the efficient use of peripheral blood
mononuclear cells in transplanted mice. The ApbHC can potentially be used for testing multi-specific
antibodies, including its own bi-specific CDX antibody, as well as for the development and testing of
new cell therapies involving immune cell programming such as CAR-T. ApbHC can also potentially be
used for the modeling of autoimmune diseases, such as Systemic Lupus Erythematosus (aka Lupus), with
a goal of developing fundamentally new treatments for those diseases.
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Chimeric Bait Receptor
In March 2022, the Company filed a seminal provisional patent application protecting its rights to the
intellectual property covering CBR.
Product development
The Group develops therapies to transform bone marrow and blood stem cell transplant procedures. These
therapies aim to replace the need for existing methods of preparation of patients for transplantation, such
as chemotherapy and radiation treatments, and at the same time address the problem of finding matching
stem cell donors whilst reducing the risk of blood stem cell rejection after transplantation.
The Group’s key products, CDX antibodies, CAR-T therapy, the CBR platform, and Hu-PHEC cell
therapy, are currently in preclinical development. In addition, the Group’s AHC product is currently the
subject of collaborations with other pharmaceutical companies to evaluate AHCs’ effectiveness as
platforms for disease modelling and drug discovery.
The Directors monitor product development through pre-clinical results. The CDX and CAR-T products
have been successfully evaluated in the Group’s proprietary humanised mouse model, achieving proof of
concept. Furthermore, we have achieved a notable demonstration of CDX’s activity versus AML cells in
vitro and in vivo. If successful, the Company may be able to use the CDX and/or CAR-T products to
eliminate R/R AML in patients who qualify for bone marrow transplantation. The Company is also
investigating the possibility of using its CDX antibodies in combination with other treatments for AML
to increase their effectiveness. A CBR construct designed to target SARS-CoV-2 has been tested in vitro.
Diversity
Hemogenyx Pharmaceuticals is committed to workplace diversity which includes but is not limited to
gender, age, ethnicity and cultural background.
Hemogenyx Pharmaceuticals’ Diversity Policy defines initiatives which assist the Company in
maintaining and improving the diversity of its workforce. The table below highlights the proportion of
women engaged by the Group:
Men
Women
Organisation as a whole
7
6
Executive management team
2
-
Board
3
1
Board of Advisors
The Group engages the services of a Board of Advisors who are highly experienced in both the clinical
development of treatments and regulatory processes to commercialisation. In addition to Professor Sir
Marc Feldmann, who runs the Board of Advisors in addition to his role as Chairman, the advisors are:
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Dr H. Michael Shepard, Ph.D.
SCIENTIFIC ADVISOR
▪ Led the discovery and development of many successful cancer treatments
including Herceptin/trastuzumab – annual sales exceed $6.5 billion worldwide
▪ Received Harvard Medical School's prestigious Warren Alpert Prize in recognition
of contributions to the field of cancer treatment research
▪ Founded NewBiotics, Inc., acquired by Kiadis Pharma
▪ Founded BioLogix, acquired by Symphogen
Dr Koen van Besien M.D.
CLINICAL ADVISOR
▪ Professor of Medicine and Director of the Stem Cell Transplant Program at NYP-Weill Cornell
College of Medicine
▪ Developed novel methods of transplantation for those patients who lack matching donors
▪ >200 publications in peer reviewed journals
▪ Editor in Chief of the journal Leukemia and Lymphoma
Corporate Responsibility
We have defined the scope of our Group’s responsible business practices as falling within the following
key focus areas:
▪ Health and Safety – ensuring the safety and well-being of our staff
▪ Environment – managing our environmental impact areas of waste, energy and water
▪ Employees – supporting our people to develop and flourish within the business
▪ Community – positive interaction with the communities in which we operate
▪ Ethical Standards – operating to the highest ethical standards
We remain committed to ensuring these activities become embedded in how we operate and contribute
towards the success of our business. This includes not only identifying and managing business risk but
exploring opportunities to add value to the business.
Greenhouse Gas Emissions
Given the nature of its activities, there is limited scope for the Group to have a major impact on
environmental matters. Nevertheless, the Directors are mindful of their responsibilities in this regard and
strive to seek opportunities where improvements may be made; these are generally concentrated in areas
of energy conservation, recycling and waste control.
Principal Risks and Uncertainties
The Group operates in an uncertain environment and is subject to a number of risk factors. The Directors
have carried out a robust assessment of the principal risks facing the Group, including those that threaten
its business model, future performance, solvency or liquidity. They consider the following risk factors
are of particular relevance to the Group’s activities and to any investment in the Group. It should be noted
that the list is not exhaustive and that other risk factors not presently known or currently deemed
immaterial may apply.
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The risk factors are summarised below:
Risks relating to the Group’s business strategy
The Group’s business is relatively undeveloped
The operations of Hemogenyx Pharmaceuticals are at a relatively early stage and, to date, no commercial
sales of its products have been made. The ability of the Group to achieve commercialisation is dependent
on a number of factors, many of which are outside of the Group’s control. Examples of factors outside of
the Group’s control are capital market conditions, FDA approval and competition.
Business strategy of the Group
The development of clinical products for new medical treatments is inherently uncertain, with high failure
rates in clinical studies for both early and late stage development products and such clinical studies can
be expensive, time-consuming and complicated and there is no certainty as to the outcome of such
studies. Even once clinical studies have been successfully carried out, later phase trials may not
successfully replicate or improve on such outcomes.
Staffing and key personnel
The Group is reliant on a number of the key personnel, in particular Dr Vladislav Sandler who is the
founder of Hemogenyx Pharmaceuticals (refer to Corporate Governance Report for further detail). Whilst
the Group has endeavoured to ensure that it has contractual arrangements which include non-compete
restrictions in place with such persons to lessen the risk of them ceasing to be involved with the Group,
in the event that the Group was to lose the services of such individuals, its results could be adversely
affected.
Costs of commercialisation
The ability of the Group to bring its products to first commercial sale will be dependent in part on the
overall costs of manufacturing and the costs involved could be significant and there is no guarantee that
the sale prices achievable for its products will be viable and sustainable.
Clinical studies and timelines risk
Hemogenyx Pharmaceuticals is currently progressing its product candidates through preclinical
development. Although encouraging results have been achieved so far, there can be no certainty that
these results can be reproduced in clinical trials. The monies raised in the Placings and Subscriptions,
as well as the Orgenesis and Mint Capital convertible loans, are intended to support those preclinical
development activities.
The development of clinical products for new medical treatments is inherently uncertain, with high
failure rates in clinical studies for both early- and late-stage development products. Furthermore, such
clinical studies (Phase 1, Phase 2a/2b, Phase 3) are typically expensive, complex, can take considerable
time to complete and have uncertain outcomes.
Furthermore, as a result of adverse, undesirable, unintended or inconclusive results from any testing or
clinical trials (which have yet to be designed), the future progress, planning and potential treatment
outcome of the products and clinical programmes may be affected and may potentially prevent or limit
the commercial use of one, many or all of the Company's products. In addition, later phase clinical trials
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may fail to show the desired safety and efficacy obtained in earlier studies, and a successful
completion of one stage of clinical development of an investigational clinical product does not ensure
that subsequent stages of clinical development will be successful.
Failure can occur at any stage of clinical development and, as a result, enforced delays to the clinical
development plan could delay or prevent commercialisation of the Company's product candidates.
Various factors associated with the potential failure or delay in completing a clinical programme include,
but are not limited to:
▪ Delays in securing clinical investigators or clinical study sites;
▪ Delays in securing any regulatory authority, hospital ethics committee, or institutional review
board approval or approvals necessary to commence a clinical study;
▪ Delays or failure to recruit a sufficient number of clinical study participants in accordance with
the clinical study protocol;
▪ Difficulty or inability to monitor subjects adequately during or after treatment;
▪ Inability to replicate in Phase 3 controlled studies any safety and efficacy data obtained from
controlled Phase 2a/2b clinical studies;
▪ Difficulty or inability to secure clinical investigator compliance to follow the approved clinical
study protocol; and
▪ Unexpected adverse events or any other safety or related issues.
Research and development risk
The Group operates in the biotechnology and bio-pharmaceutical development sectors and carries out
complex scientific research. If the research or preclinical testing or clinical trials of any of Hemogenyx
Pharmaceuticals’ product candidates fail, meaning that these candidates will not be licensed or marketed,
this would result in a complete absence of revenue from these failed candidates. Positive results from
preclinical and early clinical studies do not guarantee positive results from clinical trials required to
permit application for regulatory approval. Furthermore, the Group may discontinue the development
of candidates if results are not positive or unlikely to further its progress towards a meaningful outcome
or collaboration.
Intellectual property (IP) infringement
The Group may be subject to future litigation concerning its own IP and the IP of others. Adverse
judgements in relation to its IP would likely have negative outcomes for its results of operations.
Intellectual property (IP) control
The Group is partially reliant on an exclusive, world-wide licence of a patent from Cornell University for
its Hu-PHEC line of business. The exclusivity and exploitable territory for this licence depend on the Group
meeting various developmental milestones.
Environmental and other regulatory requirements
The event of a breach with any environmental or regulatory requirements may give rise to reputational,
financial or other sanctions against the Group, and therefore the Board considers these risks seriously and
designs, maintains and reviews its policies and processes so as to mitigate or avoid these risks. Whilst the
Board has a good record of compliance, there is no assurance that the Group’s activities will always be
compliant.
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Financing
The Group’s ability to develop its product through to commercial sale will depend upon the Group’s
ability to obtain financing primarily through a further raising of new equity capital. Although the Group
has been successful in raising new equity capital, there can be no guarantee that it will be able to do so in
the future. The Group may not be successful in procuring the requisite funds on terms which are
acceptable to it (or at all) and, if such funding is unavailable, would raise questions over its ability to
further develop its products through to commercialisation. Further, Shareholders’ holdings of Ordinary
Shares may be materially diluted if debt financing is not available.
Market conditions
Market conditions, including general economic conditions and their effect on exchange rates, interest
rates and inflations rates, may impact the ultimate value of the Group regardless of its operating
performance. The Group also faces competition from other organisations, some of which may have
greater resources or be more established in a particular territory. The Board considers and reviews all
market conditions to try and mitigate any risks that may arise from these.
Political and country risk – UK departure from the EU
The departure of the UK from the EU is now complete and impact on the business, whose current
operations are principally in the US, has been negligible. Any further changes in international trade, tariff
and import/export regulations as a result of Brexit or otherwise may impose unexpected duty costs or
other non-tariff barriers on the Group. The Company is monitoring matters and will seek advice, where
necessary, as to how to mitigate the risks arising.
Pandemic and business disruption risk
The Company may be affected by disruptions to its operations in one or more locations, particularly in
the near future in light of responses to the novel coronavirus or other potential pandemics. The Company’s
New York operations are classed as an essential business and have not been subject to closure, and work
has continued to date with prudent hygiene and distancing measures in place including limited work in
the laboratory on rota and work from home. All laboratory staff have been fully vaccinated. The Company
is allowing for extended delivery times for some supplies, and for slower progress with collaboration
partners. The Board and UK management continue to operate remotely, as usual. At present the Company
believes that there should be no significant material disruption to its work, but the Board continues to
monitor these risks and the Company’s business continuity plans.
Approved by the Board on 29 April 2022
Dr Vladislav Sandler
CEO
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Directors’ Report for the year ended 31 December 2021
The Directors present their report with the audited financial statements of the Group for the year ended
31 December 2021.
The Company’s Ordinary Shares were admitted to listing on the London Stock Exchange under the name
Silver Falcon plc, on the Official List pursuant to Chapters 14 of the Listing Rules, which sets out the
requirements for Standard Listings, on 9 November 2015.
On 4 October 2017 the Company’s shareholders voted in favour of acquiring the biotechnology company
Hemogenyx Pharmaceuticals Limited, with shares being readmitted to trading on 5 October 2017 under
the name Hemogenyx Pharmaceuticals plc.
Principal Activity
The Group’s principal activity is the discovery, development and commercialisation of a suite of products
to address current problems associated with the treatment of blood disorders such as cancers and
autoimmune diseases, with viral infections, and with bone marrow, or hematopoietic stem cell,
transplants. The company's leading technologies aim to change the way in which bone
marrow/hematopoietic stem cell ("BM"/"HSC") transplants are performed and improve their efficacy.
Hemogenyx Pharmaceuticals’ distinct and complementary products include immunotherapy product
candidates for the treatment of AML and other blood malignancies and patient conditioning – the CDX
bi-specific antibody and CAR-T therapy, and a cell therapy product for BM/HSC transplantation – the
Hu-PHEC. Each of these products holds the potential to revolutionise the way BM/HSC transplants are
being performed or diseases of the blood are treated, offering solutions that mitigate the dangers and
limitations associated with the current standard of care. Additionally, the Group is developing CBR, a
novel platform technology potentially capable of programming immune cells to attract and destroy a wide
range of viruses and malignant (cancer-causing) cells.
The Group has three companies that are located outside of the UK. The principal laboratory of the Group
is located in Manhattan, New York, USA. The Group also had a subsidiary in Liège, Belgium that was
dissolved on 30 March 2022.
Results and Dividends
The Consolidated Statement of Comprehensive Income set out on page 44 shows a loss for the year
amounting to £5,108,310 (2020: loss of £2,095,023). The Directors do not propose a dividend in respect
of the year ended 31 December 2021 (31 December 2020: nil).
Directors and Directors’ Interests
The Directors who held office during the year and up to the date of this report were as follows:
Date Appointed
Date Resigned
Professor Sir Marc Feldmann
9 April 2018
-
Dr Vladislav Sandler
4 October 2017
-
Alexis Sandler
4 October 2017
-
Peter Redmond
29 July 2015
-
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The Directors of the Company who held office at 31 December 2021 had the following beneficial interests
in the Ordinary shares of the Company at 31 December 2021 according to the register of directors’
interests:
Director
At 31 December 2021
At 31 December 2020
Professor Sir Marc Feldmann
-
-
Peter Redmond*
5,596,270
5,596,270
Dr Vladislav Sandler
41,544,677
41,544,677
Alexis Sandler
75,090,685
75,090,685
* Peter Redmond holds the majority of these shares through Catalyst Corporate Consultants Ltd of which
he is the sole shareholder.
At the date of this report, there have been no further changes to the Directors’ beneficial interest in the
Ordinary shares of the Company as disclosed in the table above.
According to the Register of Directors’ Interests, no rights to subscribe for shares in or debentures of
Group companies were granted to any of the Directors or their immediate families, or exercised by them,
during the financial year, save for the annual grant of 10,000 ownership units in Immugenyx LLC due to
Dr Vladislav Sandler under the terms of his appointment as CEO and Chief Scientific Officer of that
company. Grants of options are as indicated below (see Note 20 for detail on option plans):
Options
Date of grant
Number of
options at start
of year
Options granted
or acquired
during year
Options lapsed
during year
Number of
options at end of
year
Professor Sir
Marc Feldmann
9 Apr 2018
18,002,568
-
-
18,002,568
18,002,568
-
-
18,002,568
Dr Vladislav Sandler
20 August 2020
5,000,000
-
-
5,000,000
5,000,000
-
-
5,000,000
Peter Redmond
13 July 2020
2,200,000
-
-
2,200,000
2,200,000
-
-
2,200,000
Qualifying Third Party Indemnity Provision
At the date of this report, the Company has a third-party indemnity policy in place for all Directors.
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Substantial Shareholders
As at 31 December 2021, the total number of issued Ordinary Shares with voting rights in the Company
was 979,749,321 (now: 979,749,321). The Company has been notified of the following interests of 3 per
cent or more in its issued share capital as at the date of approval of this report:
Party Name
Number of Ordinary Shares
% of Share Capital
Alexis Sandler
75,090,685
7.66
Vladislav Sandler
41,544,677
4.24
Relationship Agreement
In accordance with Listing Rule 9.8.4(14)R, the Company has set out below a statement describing the
relationship agreement entered into by the Company with its principal shareholder(s).
On 8 September 2017, the Company entered into a Relationship Agreement with Dr Vladislav Sandler
and Alexis Sandler (the “Controlling Parties”), which came into force at the Company’s re-admission.
The principal purpose of the Relationship Agreement was to ensure that the Company was capable at all
times of carrying on its business independently of the Controlling Parties.
The Relationship Agreement provided that the Controlling Parties undertake to use all reasonable
endeavours to procure that they and their associates shall:
▪ conduct all transactions with the Company on an arm’s length basis and on a normal commercial
basis;
▪ not take any action that would have the effect of preventing the Company from complying with
its obligations under the Listing Rules or the corporate governance principles adopted by the
Group;
▪ not propose or procure the proposal of a shareholder resolution which is intended to, or appears
to be intended to, circumvent the proper application of the Listing Rules; and
▪ not take any action which was intended to, or appeared to be intended to, breach or circumvent
the proper application of the Relationship Agreement, the Listing Rules or the corporate
governance principles adopted by the Group.
The Directors believed that the terms of the Relationship Agreement enabled the Company to carry on
its business independently from the Controlling Parties and their affiliates and ensure that all transactions
and relationships between the Company and the Controlling Parties were at arm’s length and on a normal
commercial basis. The Company has and, in so far as it is aware, the Controlling Parties and their
associates have, complied with the independence provisions set out in the Relationship Agreement from
the date of the agreement, through the relevant period under review. The ordinary shares owned by the
Controlling Parties rank pari passu with the other ordinary shares in all respects.
According to the terms of the Relationship Agreement, if the Company ceases to be admitted to the Main
Market of the London Stock Exchange, or the Controlling Parties (together with their associates) cease
to hold 20 per cent or more of the voting rights over the Company’s shares, the Relationship Agreement
shall terminate save for certain specified provisions. During the course of 2021, the shareholding of the
Controlling Parties fell below 20% and accordingly the Relationship Agreement has now terminated.
Share Capital
Details of the issued share capital, together with details of the movement in issued share capital during
the year, are shown in Note 18 to the financial statements.
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Financial Instruments
Details of the use of the Company’s financial risk management objectives and policies as well as exposure
to financial risk are contained in the Accounting policies and Note 25 of the financial statements.
Future Developments and Events Subsequent to the Year End
Further details of the Group’s future developments and events subsequent to the year end are set out in
the Chairman’s Statement and Strategic Report.
Corporate Governance
The Corporate Governance report forms part of the Directors’ Report and is disclosed on pages 24-30.
Going Concern
The Company’s business activities, together with facts likely to affect its future operations and financial
and liquidity positions are set out in the Chairman’s Statement and Directors’ Strategic Report. In addition,
Note 25 to the financial statements discloses the Company’s capital risk management policy and Note 2
details further considerations made by the Directors in respect of going concern.
The Directors, having made due and careful enquiry, are of the opinion that the Company has access to
sufficient funding in order to execute its operations over the next 12 months. The Directors therefore have
made an informed judgment, at the time of approving the financial statements, that there is a reasonable
expectation that the Company has adequate resources to continue in operational existence for the
foreseeable future. As a result, the Directors have adopted the going concern basis of accounting in the
preparation of the annual financial statements.
Political Donations
The Group made no political donations during the year (2020: £nil).
Charitable Donations
There were no charitable donations made by the Group in the current or prior year.
Greenhouse Gas Emissions
Greenhouse gas emissions, energy consumption and energy efficiency disclosures have not been provided
because the Company has consumed less than 40,000 kWh of energy during the period, based on
consumption figures derived from utility bills for the Company’s premises.
Auditors
The auditors, PKF Littlejohn LLP, have expressed their willingness to continue in office and a resolution
to reappoint them will be proposed at the Annual General Meeting.
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Annual Report & Financial Statements for the
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Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Annual Report and the financial statements in accordance
with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that
law the Directors have elected to prepare the Group and Company financial statements in accordance
with UK-adopted international accounting standards.
Under Company law the Directors must not approve the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of the Group and Company and of the profit or loss of
the Group for that year.
In preparing these financial statements, the Directors are required to:
▪ Select suitable accounting policies and then apply them consistently;
▪ Make judgments and accounting estimates that are reasonable and prudent;
▪ State whether applicable UK-adopted international accounting standards have been followed,
subject to any material departures disclosed and explained in the financial statements; and
▪ Prepare the financial statements on the going concern basis unless it is inappropriate to presume
that the Group and Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the Group and parent company’s transactions and disclose with reasonable accuracy at any time
the financial position of the Group and parent company and enable them to ensure that the financial
statements and the Directors’ remuneration report comply with the Companies Act 2006. They are also
responsible for safeguarding the assets of the Group and parent company and hence for taking reasonable
steps for the prevention and detection of fraud and other irregularities. They are also responsible to make
a statement that they consider that the annual report and accounts, taken as a whole, is fair, balanced, and
understandable and provides the information necessary for the shareholders to assess the Group and
parent company’s position and performance, business model and strategy.
The Directors are responsible for the maintenance and integrity of the corporate and financial information
included on the Company’s website. Legislation in the United Kingdom governing the preparation and
dissemination of the financial statements may differ from legislation in other jurisdictions.
Directors’ Responsibility Statement Pursuant to Disclosure and Transparency Rules
Each of the Directors, whose names and functions are listed on page 1, confirms that, to the best of their
knowledge and belief:
▪ the group and company financial statements have been prepared in accordance with UK-adopted
international accounting standards, and give a true and fair view of the assets, liabilities, financial
position and loss of the Group; and
▪ the Annual Report and financial statements, including the Business review, includes a fair review
of the development and performance of the business and the position of the Group and parent
company, together with a description of the principal risks and uncertainties that they face.
Disclosure of Information to Auditors
So far as the Directors are aware, there is no relevant audit information of which the Company’s auditors
are unaware, and each Director has taken all the steps that he ought to have taken as a Director in order
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to make himself aware of any relevant audit information and to establish that the Company’s auditors are
aware of that information.
Approved by the Board on 29 April 2022
Dr Vladislav Sandler
CEO
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Annual Report & Financial Statements for the
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Governance Report
Introduction
The Company recognises the importance of, and is committed to, high standards of Corporate
Governance. The Company has voluntarily applied the main and supporting principles set out in the UK
Code of Corporate Governance published by the Financial Reporting Council in 2018 ("the Code"). The
Code has been followed to the extent practicable for a company of its size and nature. The Code can be
found at frc.org.uk/our-work/publications/Corporate-Governance. The ways in which the Company has
applied the Code are explained below:
▪ The Code requires that a smaller company should have at least two Independent Non-Executive
Directors. As at 31 December 2021 the Board consisted of an Executive Director and three Non-
Executive Directors. The Non-Executive Directors are interested in either ordinary shares in the
Company, options over ordinary shares in the Company, or both, and cannot therefore be
considered fully independent under the Code. The remuneration of the Non-Executive Directors
includes options and this is contrary to best practice, and thus the Company is not in full
compliance. However, the Directors consider the present structure and arrangements to be
adequate given the size and stage of development of the Company, and all are considered to be
independent in character and judgement.
▪ Directors appointed by the Board are subject to election by shareholders at the Annual General
Meeting of the Company following their appointment and thereafter are subject to re-election in
accordance with the Company’s articles of association. The terms and conditions of appointment
of Non-Executive Directors will be made available upon written request.
The Board has voluntarily adopted a code for Directors’ dealings based on the Model Code contained in
the Listing Rules of the UK Listing Authority that was previously in force. The Board will be responsible
for taking all proper and reasonable steps to ensure compliance with the code by the Directors.
Compliance with the code is being undertaken on a voluntary basis and the FCA will not have the authority
to (and will not) monitor the Company’s voluntary compliance with it, nor to impose sanctions in respect of
any failure by the Company to so comply. In addition, the Company will take all proper and reasonable
steps to ensure compliance by the Founders with the Code for dealings in the Ordinary Shares.
The Company is small with a modest resource base. The Company has a clear mandate to optimise the
allocation of limited resources to support its development plans. As such, the Company strives to maintain
a balance between conservation of limited resources and maintaining robust corporate governance
practices. As the Company evolves, the Board is committed to enhancing the Company’s corporate
governance policies and practices deemed appropriate for the size and maturity of the organisation.
Set out below are the Company’s corporate governance practices for the year ended 31 December 2021.
Committees
The Company has established audit, remuneration and nomination committees.
Audit Committee
The Audit Committee has responsibility for, among other things, the monitoring of the integrity of the
financial statements of the Company and its Group and the involvement of the Group's auditors in that
process. It focuses in particular on compliance with accounting policies and ensuring that an effective
system of external audit and financial control is maintained, including considering the scope of the annual
audit and the extent of the non-audit work undertaken by external auditors and advising on the
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Annual Report & Financial Statements for the
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25
appointment of external auditors. The ultimate responsibility for reviewing and approving the annual
report and accounts and the half-yearly reports remains with the Board. The Audit Committee will meet
at least three times a year at the appropriate times in the financial reporting and audit cycle.
The members of the Audit Committee are Peter Redmond, who acts as chairman of the committee, and
Professor Sir Marc Feldmann.
The Group’s external auditor is PKF Littlejohn LLP who has served as external auditor for six years. The
role of external auditor last went to tender in 2015. The Audit Committee closely monitors the level of
audit and non-audit services that it provides to the Company and Group.
Having assessed the performance, objectivity and independence of the auditor, the Committee will be
recommending the reappointment of PKF Littlejohn LLP as auditor to the Company at the 2022 Annual
General Meeting.
During the year to 31 December 2021 the Audit Committee considered the following key issues in
relation to the Financial Statements:
Issue
Action
▪ Accounting policies
The Committee reviewed and discussed the significant
accounting policies with management and the external
auditor and reached the conclusion that each policy was
appropriate to the Group.
▪ Carrying value of investment in
Hemogenyx Pharmaceuticals
LLC
The Committee reviewed the impairment assessment
report prepared by management and agreed that given the
reasonable expectation that the Group will achieve its
milestone targets over the next 18 months that no
impairment to the value of the investment in Hemogenyx
Pharmaceuticals LLC was required as at 31 December
2021.
▪ Going concern review
The Committee considered the ability of the Group to
operate as a Going Concern considering cash flow
forecasts for the next 12 months and milestone
achievements. It was determined by the Committee that it
was reasonable to expect that the Group has or will have
access to sufficient funding in order to achieve its 12-
month milestone targets and that it was appropriate for the
Financial Statements to be prepared on a going concern
basis.
▪ Review of audit and non-audit
services and fees
The external auditor is not engaged by the Group to carry
out any non-audit work in respect of which it might, in the
future, be required to express an audit opinion.
The Committee reviewed the fees charged for the
provision of audit and non-audit services and determined
that they were in line with fees charged to companies of
similar size and stage of development.
The Committee considered and was satisfied the external
auditor’s assessment of its own independence.
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Remuneration Committee
The remuneration committee reviews the performance of the Executive Directors and makes
recommendations to the Board on matters relating to their remuneration and terms of employment. The
committee also makes recommendations to the Board on proposals for the granting of share awards and
other equity incentives pursuant to any share award scheme or equity incentive scheme in operation from
time to time. The Remuneration Committee will meet at least twice a year.
The members of the Remuneration Committee are Peter Redmond, who acts as chairman of the
committee, and Alexis Sandler.
Nomination Committee
The Nomination Committee is responsible for considering and making recommendations to the Board in
respect of appointments to the Board, the Board committees and the chairmanship of the Board
committees. It is also responsible for keeping the structure, size and composition of the Board under
regular review, and for making recommendations to the Board with regard to any changes necessary,
taking into account the skills and expertise that will be needed on the Board in the future. The Nomination
Committee meets at least once a year.
The members of the Nomination Committee are Peter Redmond, who acts as chairman of the committee,
Professor Sir Marc Feldmann, and Alexis Sandler.
Leadership
The Company is headed by an effective Board which is collectively responsible for the long-term success
of the Company.
The role of the Board: the Board sets the Company’s strategy, ensuring that the necessary resources are
in place to achieve the agreed strategic priorities, and reviews management and financial performance. It
is accountable to shareholders for the creation and delivery of strong, sustainable financial performance
and long-term shareholder value. To achieve this, the Board directs and monitors the Company’s affairs
within a framework of controls which enable risk to be assessed and managed effectively. The Board also
has responsibility for setting the Company’s core values and standards of business conduct and for
ensuring that these, together with the Company’s obligations to its stakeholders, are widely understood
throughout the Company. The Board has a formal schedule of matters reserved which is provided later
in this report.
Board Meetings: the core activities of the Board are carried out in scheduled meetings of the Board. These
meetings are timed to link to key events in the Company’s corporate calendar and regular reviews of the
business are conducted. Additional meetings and conference calls are arranged to consider matters which
require decisions outside the scheduled meetings. During the year, the Board met on 24 occasions.
Outside the scheduled meetings of the Board, the Directors maintain frequent contact with each other to
discuss any issues of concern they may have relating to the Company or their areas of responsibility, and
to keep them fully briefed on the Company’s operations.
Matters reserved specifically for the Board: the Board has a formal schedule of matters reserved that can
only be decided by the Board. The key matters reserved are the consideration and approval of:
▪ The Company’s overall strategy;
▪ Financial statements and dividend policy;
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▪ Management structure including succession planning, appointments and remuneration; material
acquisitions and disposal, material contracts, major capital expenditure projects and budgets;
▪ Capital structure, debt and equity financing and other matters;
▪ Risk management and internal controls;
▪ The Company’s corporate governance and compliance arrangements; and
▪ Corporate policies
Summary of the Board’s work in the year: during the year, the Board considered all relevant matters
within its remit, but focused in particular on the development and risk diversification of the Company.
Attendance at Board meetings
Number held and
entitled to attend
Number
attended
Dr Vladislav Sandler
24
24
Professor Sir Marc Feldmann
24
18
Alexis Sandler
24
24
Peter Redmond
24
23
The Board is pleased with the high level of attendance and participation of Directors at Board and
committee meetings.
The Chairman sets the Board Agenda and ensures adequate time for discussion.
Non-Executive Directors: the Non-Executive Directors bring a broad range of business and commercial
experience to the Company and have a particular responsibility to challenge independently and
constructively the performance of the Executive management (where appointed) and to monitor the
performance of the management team in the delivery of the agreed objectives and targets.
All directors with the exception of the CEO and Professor Sir Marc Feldmann were appointed for an
initial term of 12 months. These terms were extended by mutual agreement after satisfactory performance
and re-election by shareholders.
Other governance matters: all of the Directors are aware that independent professional advice is available
to each Director in order to properly discharge their duties as a Director. In addition, each Director and
Board committee has access to the advice of the Company Secretary.
The Company Secretary: the Company Secretary is Andrew Wright. He is responsible for the Board
complying with UK procedures.
Effectiveness
For the period under review the Board comprised a Chief Executive Officer, a Non-Executive Chairman,
and two independent Non-Executive Directors. Biographical details of the Board members are set out on
pages 8-9 of this report.
The Directors are of the view that the Board and its committees consist of Directors with an appropriate
balance of skills, experience, independence and diverse backgrounds to enable them to discharge their
duties and responsibilities effectively.
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Independence: the Non-Executive Directors bring a broad range of business and commercial experience
to the Company. The Board considers each of the Non-Executive Directors to be independent in character
and judgement.
Appointments: the Board is responsible for reviewing and the structure, size and composition of the Board
and making recommendations to the board with regards to any required changes.
Commitments: all Directors have disclosed any significant commitments to the Board and confirmed that
they have sufficient time to discharge their duties.
Induction: all new Directors received an induction as soon as practical on joining the Board.
Conflict of interest: a Director has a duty to avoid a situation in which he or she has, or can have, a direct or
indirect interest that conflicts, or possibly may conflict with the interests of the Company. The Board had
satisfied itself that there is no compromise to the independence of those Directors who have appointments
on the Boards of, or relationships with, companies outside the Company. The Board requires Directors
to declare all appointments and other situations which could result in a possible conflict of interest.
Board performance and evaluation: Hemogenyx Pharmaceuticals plc has a policy of appraising Board
performance annually. Having reviewed various approaches to Board appraisal, it has concluded that for
a company of its current scale, an internal process in which all Board members submit answers to a
questionnaire that considers the functionality of the Board and its committees is most appropriate at this
stage.
Accountability
The Board is committed to providing shareholders with a clear assessment of the Company’s position
and prospects. This is achieved through this report and as required in other periodic financial and trading
statements.
Going concern: the Company’s business activities, together with factors likely to affect its future
operations, financial position, and liquidity position are set out in the Chairman’s Statement and the
principal risks and uncertainties sections of the Strategic Report. In addition, the Notes to the Financial
Statements disclose the Company’s financial risk management practices with respect to its capital
structure, liquidity risk, interest rate risk, credit risk, and other related matters.
The Directors, having made due and careful enquiry, are of the opinion that the Company has adequate
working capital to execute its operations and has the ability to access additional financing over the next
12 months. The Directors, therefore, have made an informed judgement, at the time of approving financial
statements, that there is a reasonable expectation that the Company has adequate resources to continue in
operational existence for the foreseeable future. As a result, the Directors have continued to adopt the
going concern basis of accounting in preparing the annual financial statements.
Internal controls: the Board of Directors reviews the effectiveness of the Company’s system of internal
controls in line with the requirement of the Code. The internal control system is designed to manage the
risk of failure to achieve its business objectives. This covers internal financial and operational controls,
compliances and risk management. The Company has necessary procedures in place for the year under
review and up to the date of approval of the Annual Report and financial statements. The Directors
acknowledge their responsibility for the Company’s system of internal controls and for reviewing its
effectiveness. The Board confirms the need for an ongoing process for identification, evaluation and
Hemogenyx Pharmaceuticals plc
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management of significant risks faced by the Company. The Directors carry out a risk assessment before
signing up to any commitments.
Workforce policies and practices
The Board is responsible for ensuring that workforce policies and practices are consistent with the
Group’s values and support its long term sustainable success, and that staff are able to raise any matters
of concern. The Non-executive Director designated to engage with the workforce on these matters is
Alexis Sandler. Ms Sandler, and in turn the Board, review the Group’s policies and procedures, including
anti-harassment and discrimination policies, sexual harassment reporting procedures, and procedures for
reporting grievances or other concerns, and oversee the proportionate and independent investigation of
any matters arising from them. These policies are provided to workers prior to the start of their work with
the Group, and hard copies are posted prominently in the Group’s operating premises together with other
legally required notices.
Relations with stakeholders
The Company is committed to a continuous dialogue with shareholders as it believes that this is essential
to ensure a greater understanding of and confidence amongst its shareholders in the medium and longer
term strategy of the Group and in the Board’s ability to oversee its implementation. It is the responsibility
of the Board as a whole to ensure that a satisfactory dialogue takes place.
Section 172 of the Companies Act 2006 requires Directors to take into consideration the interests of
stakeholders in their decision making. The Board is committed to understanding and engaging with all
key stakeholder groups of the Company in order to maximise value and promote long-term Company
success in line with our strategic objectives. The Board recognises its duties under Section 172 and
continuously has regard to how the Company’s activities and decisions will impact employees, those with
which it has a business relationship, the community and environment and its reputation for high standards
of business conduct. In weighing all of the relevant factors, the Board, acting in good faith and fairly
between members, makes decisions and takes actions that it considers will best lead to the long-term
success of the Company.
During the year, the Board assessed its current activities between the Board and its stakeholders, which
demonstrated that the Board actively engages with its stakeholders and takes their various objectives into
consideration when making decisions. Specifically, actions the Board has taken to engage with its
stakeholders in 2021 include:
▪ Attended the 2021 AGM, which was once again a closed meeting in 2021 due to the restrictions
imposed by the UK government’s response to the COVID-19 pandemic, prepared to answer any
questions raised by shareholders;
▪ Arranged meetings with certain stakeholders to provide them with updates on the Company’s
research and development activities and other general corporate updates;
▪ Made presentations at conferences and published recordings and slide decks on the Company’s
research and development;
▪ Evaluated the relationships with the Company’s various collaborators through management and
identified ways to strengthen relationships and arrangements with key collaborations; and
▪ Monitored company culture and engaged with employees on efforts to continuously improve
company culture and morale.
The Board believes that appropriate steps and considerations have been taken during the year so that each
Director has an understanding of the various key stakeholders of the Company. The Board recognises its
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responsibility to contemplate all such stakeholder needs and concerns as part of its discussions, decision-
making, and in the course of taking actions, and will continue to make stakeholder engagement a top
priority in the coming years.
The Board’s primary shareholder contact is through Peter Redmond, the Non-Executive Director
responsible for shareholder relations. The Chairman, the CEO and other Directors, as appropriate, make
themselves available for contact with major shareholders and other stakeholders in order to understand
their issues and concerns.
The Company plans to use the AGM as an opportunity to communicate with its shareholders. Notice of
the AGM will be issued shortly and at least 21 days before the date of the meeting. To ensure compliance
with the Governance Code, the Board proposes separate resolutions for each issue, and proxy forms allow
shareholders who are unable to attend the AGM to vote for or against or to withhold their vote on each
resolution. The results of all proxy voting will be published on the Group’s web site after the AGM.
Shareholders who attend the AGM will have the opportunity to ask questions.
The Group’s web site at https://hemogenyx.com is the primary source of information on the Group. The
web site includes an overview of the activities of the Group and all recent Group announcements.
Viability statement
In accordance with the UK Corporate Governance Code published in July 2018, the Directors have
assessed the prospects of the Group and concluded that it is appropriate to adopt the going concern basis
of accounting based on the amount of cash on hand at the end of the year and at the time of publication
of this report. The assessment of going concern is disclosed in Note 2.
The Board’s assessment of the Group’s current position and principal risks are disclosed in the Directors’
Strategic Report on pages 14 to 17.
Dr Vladislav Sandler
CEO
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Directors’ Remuneration Report
The Company has an established remuneration committee. The Committee reviews the scale and structure
of the Directors’ fees, taking into account the interests of shareholders and the performance of the
Company and directors.
The items included in this report are unaudited unless otherwise stated.
Statement of Hemogenyx Pharmaceutical plc’s Policy on Directors’ Remuneration by the
Chairman of the Remuneration Committee
As Chairman of the Remuneration Committee I am pleased to introduce our Directors’ Remuneration
Report. One of the Remuneration Committee’s aims is to provide clear, transparent remuneration
reporting for our shareholders which adheres to the best practice corporate governance principles that are
required for listed organisations.
The Directors’ Remuneration Policy, which is set out on pages 32 to 36 of this report, will be submitted
to shareholders for approval at our Annual General Meeting.
A key focus of the Directors’ Remuneration Policy is to align the interests of the Directors to the long-
term interests of the shareholders and aims to support a high-performance culture with appropriate reward
for superior performance, without creating incentives that will encourage excessive risk taking or
unsustainable company performance. This is underpinned through the implementation and operation of
incentive plans.
Key Activities of the Remuneration Committee
The key activities of the Remuneration Committee are:
▪ to determine and agree with the Board the framework or broad policy for the remuneration of the
Company's chairman, chief executive, the executive directors, the company secretary and such
other members of the executive management as it is designated to consider;
▪ in determining such policy, take into account all factors which it deems necessary including
relevant legal and regulatory requirements, the provisions and recommendations of the UK
Corporate Governance Code (the "Code") and associated guidance. The objective of such policy
shall be to ensure that members of the executive management of the Company are provided with
appropriate incentives to encourage enhanced performance and are, in a fair and responsible
manner, rewarded for their individual contributions to the success of the Company;
▪ recommend and monitor the level and structure of remuneration for senior management;
▪ when setting remuneration policy for directors, review and have regard to the remuneration
trends across the Company, and review the on-going appropriateness and relevance of the
remuneration policy;
▪ obtain reliable, up-to-date information about remuneration in other companies. To help it fulfil
its obligations the Committee shall have full authority to appoint remuneration consultants and
to commission or purchase any reports, surveys or information which it deems necessary, within
any budgetary restraints imposed by the Board;
▪ be exclusively responsible for establishing the selection criteria, selecting, appointing and setting
the terms of reference for any remuneration consultants who advise the Committee;
▪ approve the design of, and determine targets for, any performance related pay schemes operated
by the Company and approve the total annual payments made under such schemes;
▪ review the design of all share incentive plans for approval by the Board and shareholders. For
any such plans, determine each year whether awards will be made, and if so, the overall amount
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Year Ended 31 December 2021
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of such awards, the individual awards to executive directors, company secretary and other
designated senior executives and the performance targets to be used;
▪ ensure that contractual terms on termination, and any payments made, are fair to the individual,
and the Company, that failure is not rewarded and that the duty to mitigate loss is fully
recognised; and
▪ oversee any major changes in employee benefits structures throughout the Company.
Members
The Remuneration Committee comprises the following independent Non-Executive Directors:
Name
Position
Date of
appointment
Peter Redmond
Chairman
5 October 2017
Alexis Sandler
Member
5 October 2017
Remuneration Components
The Company remunerates directors in line with best market practice in the industry in which it operates.
The components of Director remuneration that are considered by the Board for the remuneration of
directors in future years are likely to consist of:
▪ Base salaries
▪ Pension and other benefits
▪ Annual bonus
▪ Share incentive arrangements
The Executive Director has entered into a service agreement with the Company and the Non-Executive
Directors have entered into letters of appointment with the Company.
All such contracts impose certain restrictions as regards the use of confidential information and
intellectual property and the Executive Director’s service contract imposes restrictive covenants which
apply following the termination of the agreement.
The Executive Director Dr Vladislav Sandler is entitled to pay at a rate of £1,500 per day for time spent in
the UK on the Company’s business. In addition, Dr Sandler has a separate contract with Hemogenyx
Pharmaceuticals LLC effective 1 September 2017 appointing him as CEO and Chief Scientific Officer of
that company for an initial three-year term with automatic continuation and setting out his duties in relation
to his day-to-day to work in connection with Hemogenyx Pharmaceuticals’ product candidates. Pursuant
to this contract, Dr Sandler was entitled to receive $225,000 in 2021 and is currently entitled to receive
$275,000 per annum (due to rise to $324,000 in 2023) and four weeks’ holiday a year. Dr Sandler is also
subject to certain non-compete and non-interference covenants in the event of its termination (subject to
certain limited exceptions). Dr Sandler also has a separate contract with Immugenyx LLC effective from 1
January 2019 appointing him as CEO and Chief Scientific Officer of that company for an initial three-year
term with automatic continuation and setting out his duties in relation to his day-to-day work in connection
with Immugenyx’s development of its AHC. Pursuant to this contract, Dr Sandler receives $64,889 (2021:
$60,000) and 10,000 ownership units in Immugenyx LLC per annum. This contract has the same non-
compete and non-interference covenants in the event of its termination as his contract with Hemogenyx
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
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33
Pharmaceuticals LLC.
Other Matters
The Company does not currently have any annual or long-term incentive schemes or any other scheme
interests in place for any of the Directors.
The Company has established a workplace pension scheme but it does not presently have any employees
qualifying under the auto-enrolment pension rules who have not opted out of the scheme. It does not
currently pay pension amounts in relation to Directors’ remuneration. The Company has not paid out any
excess retirement benefits to any Directors or past Directors. The Company has not paid any
compensation to past Directors.
Recruitment Policy
Base salary levels will take into account market data for the relevant role, internal relativities, their
individual experience and their current base salary. Where an individual is recruited at below market
norms, they may be re-aligned over time (e.g. two to three years), subject to performance in the role.
Benefits will generally be in accordance with the approved policy.
For external and internal appointments, the Board may agree that the Company will meet certain
relocation and/or incidental expenses as appropriate.
Payment for Loss of Office
The Committee will honour Executive Directors’ contractual entitlements. Service contracts do not
contain liquidated damages clauses. If a contract is to be terminated, the Committee will determine such
mitigation as it considers fair and reasonable in each case. There is no agreement between the Company
and its Executive Directors or employees, providing for compensation for loss of office or employment
that occurs because of a takeover bid.
The Committee reserves the right to make additional payments where such payments are made in good
faith in discharge of an existing legal obligation (or by way of damages for breach of such an obligation);
or by way of settlement or compromise of any claim arising in connection with the termination of an
Executive Director’s office or employment.
Service Agreements and Letters of Appointment
The Executive Director’s service agreement had an initial term of two years and may subsequently be
terminated by the Company or the Executive Director by giving 6 months’ notice.
Name
Date of service
agreement
Notice period by
Company (months)
Notice period by
Director (months)
Dr Vladislav Sandler
4 October 2017
6
6
The Non-Executive Directors of the Company do not have service contracts but are appointed by letters
of appointment. Each Non-Executive Director’s term of office runs for an initial period of one year unless
terminated earlier upon written notice or upon their resignations.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
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The terms of the Non-Executive Directors’ appointments are subject to their re-election by the
Company’s shareholders at any Annual General Meeting at which the Non-Executive Directors stand for
re-election.
The details of each Non-Executive Director’s current term are set out below:
Name
Date of service
agreement
Current
term
(years)
Notice
period by
Company
(months)
Notice
period by
Director
(months)
Date of
resignation
Alexis Sandler
4 October 2017
1
3
3
-
Peter Redmond
4 October 2017
1
3
3
-
Professor Sir Marc Feldmann
9 April 2018
3*
3
3
-
* Finalisation of a new service agreement is pending. Sir Marc has indicated his willingness to continue
in office on agreed terms, having put himself forward for re-election by shareholders as a Director at the
2021 Annual General Meeting.
Executive Directors’ Remuneration (audited)
The table below sets out the remuneration received by each Executive Director for the years ended 31
December 2021 and 2020. Dr Vladislav Sandler was the highest paid Director:
Executive Directors
Basic salary
2021
£’000
Pension
2021
£’000
Total
2021
£’000
Dr Vladislav Sandler
206
7
213
Total
206
7
213
Executive Directors
Basic salary
2020
£’000
Pension
2020
£’000
Total
2020
£’000
Dr Vladislav Sandler
200
5
205
Total
200
5
205
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
35
35
Non-Executive Directors’ Remuneration (audited)
The table below sets out the remuneration received by each Non-Executive Director during the years
ended 31 December 2021 and 2020:
Basic salary
2021
£’000
Total
2021
£’000
Alexis Sandler
45
45
Peter Redmond
50
50
Professor Sir Marc Feldmann
15
15
Total
110
110
Basic salary
2020
£’000
Total
2020
£’000
Alexis Sandler
27
27
Peter Redmond
42
42
Professor Sir Marc Feldmann
13
13
Total
82
82
Relative importance of spend on pay
The table below illustrates the year-on-year change in total remuneration compared to distributions to
shareholders and loss before tax for the financial years ended 31 December 2021 and 2020:
Distributions to
shareholders
£
Total employee
pay (including
stock based
compensation)
£
Operational cash
outflow
£
Year ended 31 December 2021
-
1,007,817
2,627,298
Year ended 31 December 2020
-
1,130,763
1,798,404
Percentage change
n/a
(10.9%)
46.1%
Total employee pay includes wages and salaries, social security costs, healthcare cost, 401K scheme cost
and share-based payments for employees in continuing operations. Further details on Employee
remuneration are provided in Note 8.
Operational cash outflow has been shown in the table above as cash flow monitoring and forecasting is
an important consideration for the Remuneration Committee and Board of Directors when determining
cash-based remuneration for directors and employees.
Historical share price performance comparison
The chart below compares the share price performance (based on a notional investment of £100) of
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
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36
Hemogenyx Pharmaceuticals plc against the FTSE SmallCap and FTSE Techmark Mediscience for the
period November 2015 to December 2021 calculated on a month end spot basis. The FTSE SmallCap has
been chosen to provide a wider market comparator constituting companies of an appropriate size and the
FTSE Techmark Mediscience chosen due to sector relevance:
Hemogenyx Pharmaceuticals plc was listed in November 2015 (under the name Silver Falcon plc) and
therefore no historical share price data exists prior to this period. There was also no data between
December 2015 and October 2017 pending completion of a transaction. It is for these reasons that the
historical investment performance is not reflective of the current Group.
Consideration of shareholder views
The Board considers shareholder feedback received and guidance from shareholder bodies. This
feedback, plus any additional feedback received from time to time, is considered as part of the Company’s
annual policy on remuneration.
Approved on behalf of the Board of Directors.
Peter Redmond
Director & Remuneration Committee Chairman
29 April 2022
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
37
37
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF HEMOGENYX
PHARMACEUTICALS PLC
Opinion
We have audited the financial statements of Hemogenyx Pharmaceuticals plc (the ‘parent company’) and
its subsidiaries (the ‘group’) for the year ended 31 December 2021 which comprise the Consolidated
Statement of Comprehensive Income, the Consolidated and Company Statements of Financial Position,
the Consolidated and Company Statements of Changes in Equity, the Consolidated and Company
Statements of Cash Flows and notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and UK-
adopted international accounting standards and as regards the parent company financial statements, as
applied in accordance with the provisions of the Companies Act 2006.
In our opinion:
▪ the financial statements give a true and fair view of the state of the group’s and of the parent
company’s affairs as at 31 December 2021 and of the group’s loss for the year then ended;
▪ the group financial statements have been properly prepared in accordance with UK-adopted
international accounting standards;
▪ the parent company financial statements have been properly prepared in accordance with UK-
adopted international accounting standards and as applied in accordance with the provisions of
the Companies Act 2006; and
▪ the financial statements have been prepared in accordance with the requirements of the
Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section of our report. We are independent of the
group and parent company in accordance with the ethical requirements that are relevant to our audit of
the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed public
interest entities, and we have fulfilled our other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis
of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’
assessment of the group’s and parent company’s ability to continue to adopt the going concern basis of
accounting included a review of management’s assessment of the going concern basis, together with
budgets and cashflows for the 12 months following the reporting date. We have reviewed all the key
inputs into the cash flow forecast, with particular emphasis on those areas of judgment and estimation
uncertainty, and ensured they are appropriate, and no evidence of management bias exists. We assessed
the levels of cash available to the group post year-end and how they are sufficient to cover expected
outgoing costs over the cash flow forecast period. We reviewed post-period end RNS announcements and
discussions with management on future plans.
Based on the work we have performed, we have not identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast significant doubt on the group’s or parent
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
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company's ability to continue as a going concern for a period of at least twelve months from when the
financial statements are authorised for issue.
In relation to the entity’s reporting on how they have applied the UK Corporate Governance Code, we
have nothing material to add or draw attention to in relation to the directors’ statement in the financial
statements about whether the directors considered it appropriate to adopt the going concern basis of
accounting.
Our responsibilities and the responsibilities of the directors with respect to going concern are described
in the relevant sections of this report.
Our application of materiality
For the purposes of determining whether the financial statements are free from material misstatement, we
define materiality as the magnitude of misstatement that makes it probable that the economic decisions
of a reasonably knowledgeable person, relying on the financial statements, would be changed, or
influenced. We also determine a level of performance materiality which we use to assess the extent of
testing needed to reduce to an appropriately low level the probability that the aggregate of uncorrected
and undetected misstatements exceeds materiality for the financial statements as a whole.
Materiality for the group financial statements as a whole was set at £54,000 (2020: £46,000). This was
calculated based on 2% of total expenses for the year. Using our professional judgement, we have
determined this to be the principal benchmark within the financial statements as it will be most relevant
to stakeholders in assessing the financial performance of the group during its years of development as the
group is not currently revenue generating.
Materiality for the parent company financial statements as a whole was set at £20,000 (2020: £40,000)
based on 2% of total expenses. We have determined this level of materiality for the parent company to
gain sufficient coverage of expenses.
Performance materiality for the group financial statements was set at £37,000 (2020: £32,000) and the
parent company was set at £14,000 (2020: £28,000), being 70% of materiality for the financial statements
as a whole respectively. A benchmark of 70% for performance materiality was applied to provide
sufficient coverage of significant and residual risks.
We agreed to report to those charged with governance all corrected and uncorrected misstatements we
identified through our audit with a value in excess of £2,000 for the group financial statements and £1,000
for the parent company financial statements. We also agreed to report any other audit misstatements
below that threshold that we believe warranted reporting on qualitative grounds.
Our approach to the audit
The scope of our audit was influenced by our application of materiality. The quantitative and qualitative
thresholds for materiality determine the scope of our audit and the nature, timing, and extent of our audit
procedures.
The group includes the listed parent company and its US based subsidiaries. We assessed the structure of
the group, its accounting processes and controls, and the industry in which it operates, in order to
determine the scope of our audit work and ensure that we obtained sufficient and appropriate audit
evidence on which to base our group audit opinion. Those entities of the group which were considered
to be significant components, being Hemogenyx LLC and Immugenyx Pharmaeuticals LLC, were subject
to full scope audit procedures by PKF Littlejohn LLP. We did not rely on the work of any component
auditors. Procedures were performed to address the assessed risks of material misstatement.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
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As part of our planning, we assessed the risk of material misstatement including those that required
significant auditor consideration at the component and group level. Procedures were then performed to
address the risk identified and for the most significant assessed risks of material misstatement. The
procedures performed are outlined below in the key audit matters section of this report.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements of the current period and include the most significant assessed risks of
material misstatement (whether or not due to fraud) we identified, including those which had the greatest
effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of
the engagement team. These matters were addressed in the context of our audit of the financial statements
as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key Audit Matter
How our scope addressed this matter
Carrying value of the intangible assets
(Group - Note 14)
The carrying value of intangible assets of
£441k was recorded in the subsidiary’s books.
There is a risk that the carrying value is
impaired. The intangibles are patent rights
and therefore this will ultimately result in the
main source of income for the group.
The directors concluded that no impairment
was required and amortisation will commence
once these products are ready for marketing.
We performed the following procedures to
address this identified risk:
▪ Substantively tested the additions
recognised during the year and agreed the
purchase price to supporting
documentation.
▪ Reviewed the directors’ assessment for
indicators of impairment and challenging
the underlying assumptions used.
▪ Reviewed the events after the year-end for
indicators of impairment.
Through the performance of the above testing, we
obtained sufficient assurance that the carrying
value of the intangible assets was not impaired,
and no indicators of impairment existed at year-
end.
Carrying Value of investments in, and loans to,
subsidiary undertakings
(Company - Note 16 and Note 15 respectively)
Investments held by the parent company in
subsidiaries, as of 31 December 2021, totals
£8.0m. Loans to those subsidiaries, as of 31
December 2021, are reported as £13.2m.
These are significant balances due to the
parent company. If the subsidiary
undertakings are unable to generate sufficient
We performed the following procedures to
address this identified risk:
▪ Reviewed the directors’ assessment of the
carrying value of investments and loans to
subsidiary undertakings, and their
conclusions thereof.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
40
40
future profits or gains in the foreseeable
future, there is a risk that both the investment
and loans held in those entities are overstated.
▪ Reviewed the subsidiary’s financial
performance and development progress to
corroborate the directors’ assessment of
recoverability.
▪ Reviewed and assessed the current state of
development, and scientific and
commercial progress of the products
under development.
▪ Reviewed board minutes for any
indications of changes in investments held
by the parent company.
▪ Agreed ownership documents of all the
subsidiaries in the group.
▪ Reviewed the market capitalisation of the
group to provide further assurance of the
carrying value of the investments and
loans to subsidiary undertakings
subsequent to the year end.
Through the performance of the above testing,
we obtained sufficient assurance that the
carrying value of investments in, and loans to,
subsidiary undertakings are not materially
overstated.
Other information
The other information comprises the information included in the annual report, other than the financial
statements and our auditor’s report thereon. The directors are responsible for the other information
contained within the annual report. Our opinion on the group and parent company financial statements
does not cover the other information and, except to the extent otherwise explicitly stated in our report,
we do not express any form of assurance conclusion thereon. Our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be
materially misstated. If we identify such material inconsistencies or apparent material misstatements, we
are required to determine whether this gives rise to a material misstatement in the financial statements
themselves. If, based on the work we have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the directors’ remuneration report to be audited has been properly prepared in
accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
41
41
▪ the information given in the strategic report and the directors’ report for the financial year for
which the financial statements are prepared is consistent with the financial statements; and
▪ the strategic report and the directors’ report have been prepared in accordance with applicable
legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and their
environment obtained in the course of the audit, we have not identified material misstatements in the
strategic report or the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act
2006 requires us to report to you if, in our opinion:
▪ adequate accounting records have not been kept by the parent company, or returns adequate for
our audit have not been received from branches not visited by us; or
▪ the parent company financial statements and the part of the directors’ remuneration report to be
audited are not in agreement with the accounting records and returns; or
▪ certain disclosures of directors’ remuneration specified by law are not made; or
▪ we have not received all the information and explanations we require for our audit.
Corporate governance statement
We have reviewed the directors' statement in relation to going concern, longer-term viability and that part
of the Corporate Governance Statement relating to the group’s and parent company's voluntary
compliance with the provisions of the UK Corporate Governance Statement specified for our review by
the Listing Rules.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements
of the Corporate Governance Statement is materially consistent with the financial statements and our
knowledge obtained during the audit:
▪ Directors’ statement with regards to the appropriateness of adopting the going concern basis of
accounting and any material uncertainties identified set out on page 28;
▪ Directors’ explanation as to its assessment of the entity’s prospects, the period this assessment
covers and why the period is appropriate set out on page 30;
▪ Directors’ statement on whether it has a reasonable expectation that the group will be able to
continue in operation to meet its liabilities set out on page 54;
▪ Directors' statement that they consider the annual report and the financial statements, taken as a
whole, to be fair, balanced, and understandable set out on page 22;
▪ Board’s confirmation that it has carried out a robust assessment of the emerging and principal
risks set out on page 14;
▪ Section of the annual report that describes the review of effectiveness of risk management and
internal control systems set out on page 28; and
▪ Section describing the work of the audit committee set out on page 24.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
42
42
Responsibilities of directors
As explained more fully in the statement of directors’ responsibilities, the directors are responsible for
the preparation of the group and parent company financial statements and for being satisfied that they
give a true and fair view, and for such internal control as the directors determine is necessary to enable
the preparation of financial statements that are free from material misstatement, whether due to fraud or
error.
In preparing the group and parent company financial statements, the directors are responsible for
assessing the group’s and the parent company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the group or the parent company or to cease operations, or have no
realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an
audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of
irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities,
including fraud is detailed below:
▪ We obtained an understanding of the group and parent company and the sector in which they
operate to identify laws and regulations that could reasonably be expected to have a direct effect
on the financial statements. We obtained our understanding in this regard through discussions
with management and application of our cumulative audit knowledge and experience of the
sector.
▪ We determined the principal laws and regulations relevant to the group and parent company in
this regard to be those arising from the Companies Act 2006, the FCA Listing Rules, the
Disclosure Guidance and Transparency Rules Sourcebook and the UK Corporate Governance
Code.
▪ We designed our audit procedures to ensure the we considered whether there were any
indications of non-compliance by the group and parent company with those laws and regulations.
These procedures included, but were not limited to:
▪ Enquiries of management
▪ Review of minutes
▪ Review of RNS publications
▪ We addressed the risk of fraud arising from management override of controls by performing
audit procedures which included, but were not limited to: the testing of journals; reviewing
accounting estimates for evidence of bias; and evaluating the business rationale of any significant
transactions that are unusual or outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities,
including those leading to a material misstatement in the financial statements or non-compliance with
regulation. This risk increases the more that compliance with a law or regulation is removed from the
events and transactions reflected in the financial statements, as we will be less likely to become aware of
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
43
43
instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather
than error, as fraud involves intentional concealment, forgery, collusion, omission, or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.
Other matters which we are required to address
We were appointed by the audit committee on 30 April 2021 to audit the financial statements for the
period ending 31 December 2021 and subsequent financial periods. Our total uninterrupted period of
engagement is 7 years, covering the periods ending 31 December 2015 to 31 December 2021.
During the period subject to audit, a non-audit service prohibited by the FRC’s Ethical Standard was
inadvertently provided by the Firm to the parent company. This service involved the preparation of a
valuation of the non-cash consideration of shares for the purposes of Section 593(1) of the Companies
Act 2006 by the Firm’s valuation partner. This non-permitted valuation service was provided without the
knowledge or approval of the Firm’s central ethics function. As the consultation required by the Firm’s
policies and procedures did not take place in respect of this service, this was assessed as an inadvertent
breach. In reviewing the nature of this inadvertent breach, specifically that it involved amounts that would
not be subject to review or consideration in the audit, no judgements were made in providing the valuation
and that it was provided by a partner separate from the audit engagement team, we concluded that this
did not affect our professional judgement or our audit report. Accordingly, in reporting the inadvertent
provision of a prohibited non-audit service to those charged with governance, we determined that our
independence had not been compromised and that we could continue to carry out the audit of the group
and parent company, with their approval.
Our audit opinion is consistent with the additional report to the audit committee.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16
of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s
members those matters we are required to state to them in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not accept or assume responsibility to anyone, other than
the company and the company's members as a body, for our audit work, for this report, or for the opinions
we have formed.
David Thompson (Senior Statutory Auditor) 15 Westferry Circus
For and on behalf of PKF Littlejohn LLP Canary Wharf
Statutory Auditor London E14 4HD
29 April 2022
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
44
44
Consolidated Statement of Comprehensive Income
Group - Continuing Operations
Note
Year Ended 31
December 2021
Year Ended 31
December 2020
£
£
Revenue
Administrative Expenses
6
(2,576,414 )
(2,043,633 )
Depreciation Expense
12
(126,340 )
(106,753 )
Operating Loss
(2,702,754 )
(2,150,386 )
Other Income
7
Finance Income
Finance Costs
23
(2,595,389 )
(33,239 )
Loss before Taxation
(5,108,310 )
(2,095,023 )
Income tax
10
Loss for the year
(5,108,310 )
(2,095,023 )
Loss attributable to:
- Owners of Hemogenyx Pharmaceuticals plc
(5,099,228 )
(2,082,220 )
- Non-controlling interests
(9,082 )
(12,803 )
(5,108,310 )
(2,095,023 )
Items that may be reclassified subsequently to profit or loss:
Translation of foreign operations
(18,025 )
(61,119 )
Other comprehensive income for the year
(18,025 )
(61,119 )
Total comprehensive income for the year
(5,126,335 )
(2,156,142 )
Attributable to:
Owners of Hemogenyx Pharmaceuticals plc
(5,117,253 )
(2,143,339 )
Non-controlling interests
(9,082 )
(12,803 )
Total comprehensive income for the year
(5,126,335 )
(2,156,142 )
Basic and diluted earnings per share attributable to the
equity owners of the Company
11
(0.007 )
(0.005 )
The Notes to the Financial Statements form an integral part of these Financial Statements.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
45
45
Consolidated Statement of Financial Position
Group
Note
31 December 2021
31 December 2020
Assets
£
£
Non-current assets
Property and equipment
12
Right of use asset
13
Security deposits
26
Deferred financing costs
23
Intangible asset
14
Total non-current assets
Current assets
Trade and other receivables
17
Cash and cash equivalents
Total current assets
Total assets
Equity and Liabilities
Equity attributable to shareholders
Paid-in Capital
Called up share capital
18
Share premium
19
Other reserves
20
Reverse asset acquisition reserve
4
(6,157,894 )
(6,157,894 )
Foreign currency translation reserve
(25,921 )
(7,896 )
Retained Earnings
(13,134,742 )
(8,035,514 )
Equity attributable to owners of the Company
Non-controlling interests
(24,240 )
(15,158 )
Total Equity
Liabilities
Non-current liabilities
Lease liabilities
13
Total non-current liabilities
Current liabilities
Trade and other payables
22
Borrowings
23
Lease liabilities
13
Total Current Liabilities
Total Liabilities
Total equity and liabilities
The Notes to the Financial Statements form an integral part of these Financial Statements.
This report was approved by the Board and authorised for issue on 29 April 2022 and signed on its
behalf by:
______________________
Dr Vladislav Sandler
CEO
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
46
46
Company Statement of Financial Position
Company
Note
31 December
2021
31 December
2020
£
£
Assets
Non-current assets
Loan to subsidiaries
15
13,214,507
2,766,051
Deferred financing costs
23
-
213,472
Investment in subsidiary
16
8,000,000
8,000,000
Total non-current assets
21,214,507
10,979,523
Current assets
Trade and other receivables
17
15,478
61,448
Cash and cash equivalents
111,245
1,036,214
Total current assets
126,723
1,097,662
Total assets
21,341,230
12,077,185
Equity and Liabilities
Equity attributable to shareholders
Paid-in Capital
Called up share capital
18
9,797,493
4,336,363
Share premium
19
16,808,647
9,990,965
Other reserves
20
903,122
749,767
Retained Earnings
(6,302,461)
(3,136,290)
Total Equity
21,206,801
11,940,805
Liabilities
Current liabilities
Trade and other payables
22
134,429
136,380
Total Current Liabilities
134,429
136,380
Total Liabilities
134,429
136,380
Total equity and liabilities
21,341,230
12,077,185
Hemogenyx Pharmaceuticals plc has used the exemption granted under s408 of the Companies Act 2006
that allows for the non-disclosure of the Income Statement of the parent company. The after-tax loss
attributable to Hemogenyx Pharmaceuticals plc for the year ended 31 December 2021 was £3,166,171
(2020: £930,475).
The Notes to the Financial Statements form an integral part of these Financial Statements.
This report was approved by the Board and authorised for issue on 29 April 2022 and signed on its
behalf by:
________________________
Dr Vladislav Sandler
CEO
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
47
47
Consolidated Statement of Changes in Equity
Group
Called up
Share
Capital
Share
Premium
Other
reserves
Reverse
acquisition
reserve
Foreign
currency
translation
reserve
Retained
earnings
Non-
Controlling
interests
Total Equity
£
£
£
£
£
£
£
£
As at 31 December
2019
(6,157,894 )
(5,953,294 )
(2,517 )
(349,035 )
Loss in year
(2,082,220 )
(12,803 )
(2,095,023 )
Other
Comprehensive
Income
(61,119 )
(61,119 )
Total
comprehensive
income for the year
(61,119 )
(2,082,220 )
(12,803
(2,156,142 )
Issue of shares, net
Exercise of
warrants
Embedded
derivative on
convertible note
Issue of options
Purchase of
subsidiary shares
As at 31 December
2020
(6,157,894 )
(7,896 )
(8,035,514 )
(15,158 )
Loss in year
(5,099,228 )
(9,082 )
(5,108,310 )
Other
Comprehensive
Income
(18,025 )
(18,025 )
Total
comprehensive
income for the
year
(18,025 )
(5,099,228 )
(9,082 )
(5,126,335 )
Conversion of debt
to equity
Shares issued to
arrangers of debt
facility
Shares issued to
consultant
Charge recognised
upon conversion of
debt
Issue of options
Adjustment to
Embedded
derivative on
convertible note
(13,944 )
(13,944 )
As at 31 December
2021
(6,157,894 )
(25,921 )
(13,134,742 )
(24,240 )
The notes to the financial statements form an integral part of these financial statements.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
48
48
Company Statement of Changes in Equity
Company
Called up
Share Capital
Share
Premium
Other reserves
Retained
earnings
Total Equity
£
£
£
£
£
As at 31 December 2019
3,612,429
7,699,789
386,663
(2,205,815)
9,493,066
Loss in year
-
-
-
(930,475)
(930,475)
Other Comprehensive
Income
-
-
-
-
-
Total comprehensive income
for the year
-
-
-
(930,475)
(930,475)
Issue of shares
717,254
2,262,786
-
-
2,980,040
Exercise of warrants
6,680
28,390
35,070
Issue of options
-
-
363,104
-
363,104
As at 31 December 2020
4,336,363
9,990,965
749,767
(3,136,290)
11,940,805
Loss in year
-
-
-
(3,166,171)
(3,166,171)
Other Comprehensive
Income
-
-
-
-
-
Total comprehensive
income for the year
-
-
-
(3,166,171)
(3,166,171)
Conversion of debt to
equity
5,373,710
5,026,290
-
-
10,400,000
Shares issued to arrangers
of debt facility
77,420
522,580
-
-
600,000
Shares issued to consultant
10,000
56,337
-
-
66,337
Charge recognised upon
conversion of debt
-
1,212,475
-
-
1,212,475
Issue of options
-
-
153,355
-
153,355
As at 31 December 2021
9,797,493
16,808,647
903,122
(6,302,461)
21,206,801
The notes to the financial statements form an integral part of these financial statements.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
49
49
Consolidated Statement of Cash Flows
Group
Note
Year Ended
31 December
2021
Year Ended
31 December
2020
£
£
Cash flows generated from operating activities
Loss before income tax
(5,108,310 )
(2,095,023 )
Depreciation
12,13
Other non-cash items
Interest income
(17,958 )
(3,365 )
Interest expense
Beneficial conversion charge related to convertible debt
23
Share based payments
20
Foreign exchange gain
(18,025 )
(146,772 )
Increase/(decrease) in trade and other payables
(35,738 )
Increase in trade and other receivables
(196,683 )
(21,397 )
Prepaid and deposits
Net cash outflow used in operating activities
(2,627,298 )
(1,798,404 )
Cash flows generated from financing activities
Proceeds from issuance of debt and equity securities
23
Proceeds from exercise of warrants
Proceeds from borrowings
23
Share issue costs
(168,160 )
Repayment of loans and borrowings
23
(3,183,281 )
Deferred financing costs
23
(223,615 )
Payment of lease liabilities
13
(39,079 )
(41,249 )
Net cash flow generated from financing activities
Cash flows generated from investing activities
Interest income
Payment of security deposit for lease
(138,913 )
Payment for intangible assets
14
(181,743 )
Purchase of property & equipment
12
(636,255 )
(173,047 )
Net cash flow generated from investing activities
(938,953 )
(169,682 )
Net increase in cash and cash equivalents
Effect of exchange rates on cash
(182,719 )
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at the end of the period
The notes to the financial statements form an integral part of these financial statements.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
50
50
Company Statement of Cash Flows
Company
Note
Year Ended 31
December 2021
Year Ended 31
December 2020
£
£
Cash flows generated from operating activities
Loss before income tax
(3,166,171)
(930,475)
Foreign exchange (loss) gain
(184,759)
26,508
Interest expense
883,692
Beneficial conversion charge related to convertible debt
23
1,212,475
Share based payments
20
153,355
363,104
(Decrease) in trade and other payables
-
(13,153)
Decrease/(increase) in trade and other receivables
45,970
(4,194)
Adjustments to net loss for cash items
(5,821)
-
Net cash outflow used in operating activities
(1,061,259)
(558,210)
Cash flows generated from financing activities
Proceeds from issuance of debt and equity securities
23
12,000,000
3,148,200
Proceeds from exercise of warrants
-
35,070
Share issue costs
-
(168,160)
Repayment of loans and borrowings
23
(1,600,000)
-
Deferred financing costs
-
(213,472)
Net cash flow generated from financing activities
10,400,000
2,801,638
Cash flows generated from investing activities
Loan to related parties
(10,263,778)
(1,221,678)
Net cash flow generated from investing activities
(10,263,778)
(1,221,678)
Net (decrease)/increase in cash and cash equivalents
(925,037)
1,021,750
Effect of exchange rates on cash
68
(41)
Cash and cash equivalents at the beginning of the period
1,036,214
14,505
Cash and cash equivalents at the end of the period
111,245
1,036,214
The Notes to the Financial Statements form an integral part of these Financial Statements.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
51
51
Notes to the Financial Statements
1.
General information
The Group’s business is preclinical-stage biotechnology focused on the discovery, development and
commercialisation of innovative treatments relating to bone marrow/hematopoietic (blood-forming)
stem cell (BM/HSC) transplants for blood diseases, including leukaemia, lymphoma and bone
marrow failure, autoimmune disease, and viral infections. The products under development are
designed to address a range of problems that occur with current standard of care treatments.
The Company’s registered office is located at 5 Fleet Place, London EC4M 7RD, and it is listed on
the London Stock Exchange.
2.
Summary of significant accounting policies
The principal accounting policies applied in the preparation of these financial statements are set out
below. These policies have been consistently applied to all the years presented, unless otherwise
stated.
Basis of preparation
The financial statements have been prepared in accordance with UK-adopted international
accounting standards and with requirements of the Companies Act 2006. The financial statements
have been prepared under the historical cost convention.
Basis of consolidation
The consolidated financial statements comprise the financial statements of Hemogenyx
Pharmaceuticals plc and its subsidiaries as at 31 December 2021. The financial statements of the
subsidiaries are prepared for the same reporting period as the parent company, using consistent
accounting policies.
All intra-group balances, transactions, income and expenses and profits and losses resulting from
intra-group transactions that are recognised in assets, are eliminated in full.
Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group
obtains control, and continue to be consolidated until the date that such control ceases. Hemogenyx
Pharmaceuticals plc owns the majority of the shareholdings and has operational control over all its
subsidiaries. Please refer to note 4 for information on the consolidation of Hemogenyx
Pharmaceuticals LLC.
Hemogenyx Pharmaceuticals plc has used the exemption granted under s408 of the Companies Act
2006 that allows for the non-disclosure of the Income Statement of the parent company. The after-
tax loss attributable to Hemogenyx Pharmaceuticals plc for the year ended 31 December 2021 was
£3,166,171 (2020: £930,475).
Research and development expenditure
(i)
Research and development
Expenditure on research activities, undertaken with the prospect of gaining new scientific or
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
52
52
technical knowledge and understanding, is expensed in profit or loss as incurred. Development
activities involve a plan or design for the production of new or substantially improved products and
processes. Development expenditures are capitalised only if development costs can be measured
reliably, the product or process is technically and commercially feasible, future economic benefits
are probable, and the Company intends to, and has sufficient resources to, complete development
and to use or sell the asset. No development costs have been capitalised to date.
(ii)
Clinical trial expenses
Clinical trial-related expenses are a component of the Company's research and development costs.
These expenses include fees paid to contract research organisations, clinical sites, and other
organisations who conduct development activities on the Company's behalf. The amount of clinical
trial expenses recognised in the period related to clinical agreements is based on estimates of the
work performed using an accrual basis of accounting. These estimates incorporate factors such as
patient enrolment, services provided, contractual terms, and prior experience with similar contracts.
(iii)
Government grants
Government grants relate to financial grants from governments, public authorities, and similar
local, national or international bodies. These are recognised when there is a reasonable assurance
that the Company will comply with the conditions attaching to them, and that the grant will be
received. Government grants relating to research and development are off-set against the relevant
costs.
Intangibles
Research and development
Research expenditure is written off as incurred. Development costs are capitalised only if the
expenditure can be measured reliably, the product or process is technically and commercially
feasible, future economic benefits are probable, the Group intends to and has sufficient resources to
complete development and to use or sell the asset, and it is able to measure reliably the expenditure
attributable to the intangible asset during its development.
The Group’s view is that capitalised assets have a finite useful life and to that extent they should be
amortised over their respective unexpired periods with provision made for impairment when
required. Assets capitalised are not amortised until the associated product is available for use or sale.
Amortisation is calculated using the straight-line method to allocate the costs of development over
the estimated useful economic lives. Estimated useful economic life is assessed by reference to the
remaining patent life and may be adjusted after taking into consideration product and market
characteristics such as fundamental building blocks and product life cycle specific to the category of
expenditure.
Intellectual property (IP)
IP assets (comprising patents, know-how, copyright and licences) acquired by the Group as a result
of a business combination are initially recognised at fair value or as a purchase at cost and are
capitalised.
Internally generated IP costs are written off as incurred except where IAS 38 criteria, as described in
research and development above, would require such costs to be capitalised.
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The Group’s view is that capitalised IP assets have a finite useful life and to that extent they should
be amortised over their respective unexpired periods with provision made for impairment when
required. Capitalised IP assets are not amortised until the Group is generating an economic return
from the underlying asset and as such no amortisation has been incurred to date as the products to
which they relate are not ready to be sold on the open market. When the trials are completed and the
products attain the necessary accreditation and clearance from the regulators, the Group will assess
the estimated useful economic life and the IP will be amortised using the straight-line method over
their estimated useful economic lives.
Property and equipment
All property and equipment are stated at historical cost less accumulated depreciation or impairment
value. Cost includes the original purchase price and expenditure that is directly attributable to the
acquisition of the items to bring the asset to its working condition. Depreciation is provided at rates
calculated to write off the cost less estimated residual value of each asset over its expected useful
economic life. Right of Use assets are depreciated over their expected useful economic life on the
same basis as owned assets, or where shorter, the lease term. Assets are reviewed for impairment
when events or changes in circumstances indicate that the carrying amount may not be recoverable.
The following rates are used:
Computer equipment
33%
Straight-line
Leasehold improvements
12.5%
Straight-line
Property & equipment
20% – 50%
Straight-line
Impairment of non-financial assets
The Group is required to review, at least annually, whether there are indications (events or changes
in circumstances) that non-financial assets have suffered impairment and that the carrying amount
may exceed the recoverable amount. If there are indications of impairment then an impairment
review is undertaken. An impairment charge is recognised within operating costs for the amount by
which the carrying amount exceeds its recoverable amount. The recoverable amount is the higher of
the asset’s fair value less costs to sell and the value-in-use. In the event that an intangible asset will
no longer be used, for example, when a patent is abandoned, the balance of unamortised expenditure
is written off.
Impairment reviews require the estimation of the recoverable amount based on value-in-use
calculations. Non-financial assets relate typically to investments in related parties and in-process
development and patents, and require broader assumptions than for developed technology. Key
assumptions taken into consideration relate to technological, market and financial risks and include
the chance of product launch taking into account the stage of development of the asset, the scale of
milestone and royalty payments, overall market opportunities, market size and competitor activity,
revenue projections, estimated useful lives of assets (such as patents), contractual relationships and
discount rates to determine present values of cash flows.
Investments
Equity investments in subsidiaries are held at cost, less any provision for impairment. As there is no
quoted price in an active market, fair value cannot be reliably measured.
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Going concern
The preparation of financial statements requires an assessment on the validity of the going concern
assumption.
The Directors have given particular thought to the impact on the Group that may result from COVID-
19 and any other potential pandemics that may arise. The Group’s New York operations were classed
as an essential business and were not subject to closure during lockdown periods, and so work
continued with prudent hygiene and distancing measures in place including limited work in the
laboratory on rota and work from home. The Group allowed for extended delivery times for some
supplies, and for slower progress with collaboration partners. The Board and UK management
continued to operate remotely, as usual. At the present time work has returned to normal, and the
Group believes that there should be no material disruption to its work in the event of further
pandemic-related restrictions. The Board continues to monitor these risks and the Group’s business
continuity plans.
The Company raised £12,000,000 before expenses through convertible debt placings during the
period, all of which was converted to equity except for £1,600,000 which was repaid. The Group had
cash and cash equivalents totalling £6,840,969 as at 31 December 2021.
The Directors, having made due and careful enquiry, are of the opinion that the Group and Company
have or will have access to sufficient funding in order to execute its operations over the next 12
months. The Directors therefore have made an informed judgment, at the time of approving the
financial statements, that there is a reasonable expectation that the Group and Company has adequate
resources to continue in operational existence for the foreseeable future. As a result, the Directors
have adopted the going concern basis of accounting in the preparation of the annual financial
statements.
Notwithstanding the Group’s cash balance, should the Group elect to raise additional capital within
the next year, it cannot be certain that such additional funding will be available on acceptable terms,
or at all. To the extent that the Company raises additional funds by issuing equity securities, the
Company’s stockholders may experience dilution. Any debt financing, if available, may involve
restrictive covenants. If the Company is unable to raise additional capital when required or on
acceptable terms, it may have to (i) significantly delay, scale back or discontinue the development
and/or commercialisation of one or more product candidates; (ii) seek collaborators for product
candidates at an earlier stage than otherwise would be desirable and on terms that are less favourable
than might otherwise be available; or (iii) relinquish or otherwise dispose of rights to technologies,
product candidates or products that it would otherwise seek to develop or commercialise on
unfavourable terms.
Trade and other receivables and payables
Trade and other receivables are amounts due from customers for services performed in the ordinary
course of business. If collection is expected in one year or less (or in the normal operating cycle of
the business if longer), they are classified as current assets. If not, they are presented as non-current
assets.
Trade and other receivables are recognised initially at fair value, and subsequently measured at
amortised cost using the effective interest method, less provision for impairment.
Other liabilities measured at amortised cost are obligations to pay for goods or services that have
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been acquired in the ordinary course of business from suppliers. The liabilities are classified as
current liabilities if payment is due within one year or less (or in the normal operating cycle of the
business if longer). If not, they are presented as non-current liabilities.
The liabilities are recognised initially at fair value, and subsequently measured at amortised cost using
the effective interest method.
Foreign currencies
Functional and presentation currency
The Company’s presentation currency is the British Pound Sterling (“£”). The functional currency
for the Company, being the currency of the primary economic environment in which the Company
operates, is the British Pound Sterling. The individual financial statements of each of the Company’s
wholly owned subsidiaries are prepared in the currency of the primary economic environment in
which it operates (its functional currency).
The financial statements of Hemogenyx Pharmaceuticals LLC, Immugenyx LLC and Hemogenyx-
Cell SPRL have been translated in to Pounds Sterling in accordance with IAS 21 The Effects of
Changes in Foreign Exchange Rates. This standard requires that assets and liabilities be translated
using the exchange rate at period end, and income, expenses and cash flow items are translated using
the rate that approximates the exchange rates at the dates of the transactions (i.e. the average rate for
the period). The foreign exchange differences on translation of Hemogenyx Pharmaceuticals LLC,
Immugenyx LLC and Hemogenyx-Cell SPRL are recognised in other comprehensive income (loss).
Foreign currency transactions
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing on the dates of the transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at period-end exchange rates of monetary
assets and liabilities denominated in foreign currencies are recognised in profit and loss.
Share capital
Ordinary Shares are classified as equity. Equity instruments issued by the Hemogenyx
Pharmaceuticals Group are recorded at the proceeds received, net of direct issue costs.
Cash
Cash consists of cash bank deposit balances.
Deferred financing costs
Deferred financing costs at 31 December 2020 represent direct expenditures made by the
Company for the financing transaction completed in January 2021. These costs were offset
against the proceeds received in 2021 from the financing transactions.
Share-based payments
The Group has applied the requirements of IFRS 2 Share-based Payment for all grants of equity
instruments.
The Group issues equity-settled share-based payments to the directors, senior management and
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Annual Report & Financial Statements for the
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employees (“Employee Share Options”), to corporate finance advisers for assistance in raising
private equity, and to its Scientific Advisory Board members (“Non-employee Share Options”). In
2021, the Group adopted the “Hemogenyx Pharmaceuticals plc 2021 Equity Incentive Plan with
Non-Employee Sub-Plan” (the “EIP”) for the grant of options, restricted shares, and restricted share
units to employees, directors and consultants of the Company and its subsidiaries over ordinary
shares in the capital of the Company, to be put to the Company’s shareholders for approval at the
2022 AGM. Equity-settled share-based payments are measured at fair value at the date of grant for
Employee Share Options and the date of service for Non-employee Share Options. The fair value
determined at the grant date or service date, as applicable, of the equity-settled share-based payments
is expensed, with a corresponding credit to equity, on a straight-line basis over the vesting period,
based on the Group’s estimate of shares that will eventually vest. At each subsequent reporting date,
the Group calculates the estimated cumulative charge for each award having regard to any change in
the number of options that are expected to vest and the expired portion of the vesting period. The
change in this cumulative charge since the last reporting date is expensed with a corresponding credit
being made to equity. Once an option vests, no further adjustment is made to the aggregate amount
expensed.
The fair value is calculated using the Black Scholes method for both Employee and Non-employee
Share Options as management views the Black Scholes method as providing the most reliable
measure of valuation. The expected life used in the model has been adjusted, based on management’s
best estimate, for the effects of non-transferability exercise restrictions and behavioural
considerations. The market price used in the model is the issue price of Company shares at the last
placement of shares immediately preceding the calculation date. The fair values calculated are
inherently subjective and uncertain due to the assumptions made and the limitation of the calculations
used.
Taxation
Current tax
Current taxation is based on the results for the year as adjusted for items that are non-assessable or
disallowed. It is calculated using rates that have been enacted, or substantially enacted, by the balance
sheet date. Current income tax assets and liabilities are measured at the amount expected to be
recovered from or paid to the relevant taxation authorities.
Deferred tax
Deferred income tax is recognised on all temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the financial statements, with the following exceptions:
▪ where the temporary difference arises from the initial recognition of goodwill or of an
asset or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither accounting nor taxable profit or loss;
▪ in respect of taxable temporary differences associated with investment in subsidiaries,
associates and joint ventures, where the timing of the reversal of the temporary
differences can be controlled and it is probable that the temporary differences will not
reverse in the foreseeable future; and
▪ deferred income tax assets are recognised only to the extent that it is probable that taxable
profit will be available against which the deductible temporary differences, carried
forward tax credits or tax losses can be utilised.
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Deferred income tax assets and liabilities are measured on an undiscounted basis at the tax rates that
are expected to apply when the related asset is realised or liability is settled, based on tax rates and
laws enacted or substantively enacted at the statement of financial position date.
The carrying amount of deferred income tax assets is reviewed at each statement of financial position
date. Deferred income tax assets and liabilities are offset, only if a legally enforcement right exists
to set off current tax assets against current tax liabilities, the deferred income taxes related to the
same taxation authority and that authority permits the Company to make a single net payment.
Income tax is charged or credited directly to equity if it relates to items that are credited or charged to
equity. Otherwise income tax is recognised in the statement of comprehensive income.
Financial Assets and Liabilities
Financial assets and liabilities are recognised in the Company’s statement of financial position when
the Company becomes a party to the contractual provisions of the instrument. The Company
currently does not use derivative financial instruments to manage or hedge financial exposures or
liabilities.
Loans and receivables are non-derivative financial assets with fixed or determinable payments that
are not quoted in an active market. They are included in current assets, except for maturities greater
than 12 months after the end of the reporting period. These are classified as non-current assets. The
Company’s loans and receivables comprise Trade and Other Receivables and Cash and Cash
Equivalents in the Statement of Financial Position.
Impairment of Financial Assets
The Company and Group assess at each reporting date whether a financial asset is impaired and will
recognise the impairment loss immediately through the consolidated statement of comprehensive
loss.
Interest Bearing Loans and Borrowings
Borrowings are initially recognised at the fair value of consideration received less directly
attributable transaction costs. After initial recognition, borrowings are subsequently measured at
amortised cost using the effective interest rate method. Where borrowings are provided by
shareholders at an interest rate discounted to market rates, the difference on initial fair value is taken
to equity as a capital contribution.
Where the Group has entered into a hybrid instrument whereby there is a debt instrument and an
embedded derivative financial liability, the fair value of the debt instrument less the fair value of the
derivative financial liability is equal to loan recognised on initial measurement.
IFRS 15, Revenue from Contracts with Customers
The Company follows IFRS 15, which establishes principles for reporting useful information to users
of financial statements about the nature, amount, timing, and uncertainty of revenue and cash flows
arising from an entity’s contracts with customers. The standard establishes a five-step principle-based
approach for revenue recognition and is based on the concept of recognising an amount that reflects
the consideration for performance obligations only when they are satisfied, and the control of goods
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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or services is transferred.
The majority of the Group’s revenue is derived from fees related to collaboration agreements.
Management reviewed contracts where the Group received consideration in order to determine
whether or not they should be accounted for in accordance with IFRS 15. To date, Hemogenyx
Pharmaceuticals has entered into few transactions that meet the scope of IFRS 15. Instead, most
income has been generated through collaboration agreements and grants with counterparties that do
not meet the definition of a customer, and therefore the contracts fall outside the scope of IFRS 15
and have been accounted for in accordance with IAS 20.
Income is recognised at either a point-in-time or over time, depending on the nature of the services
and existence of acceptance clauses.
IFRS 16, Leases
IFRS 16 requires lessees to recognise a lease liability reflecting future lease payments and a ‘right-
of-use asset’ for virtually all lease contracts. IFRS 16 includes an optional exemption for certain
short-term leases and leases of low-value assets; however, this exemption can only be applied by
lessees. For lessors, the accounting remains substantially unchanged. IFRS 16 provides updated
guidance on the definition of a lease (as well as the guidance on the combination and separation of
contracts); under IFRS 16, a contract is, or contains, a lease if the contract conveys the right to control
the use of an identified asset for a period of time in exchange for consideration.
The right-of-use asset and lease liability are both based on the present value of lease payments due
over the term of the lease, with the asset being depreciated in accordance with IAS 16 Property,
Plant and Equipment and the liability increased for the accretion of interest and reduced by lease
payments.
Segmental reporting
The Group’s operations are located in New York, USA and in Liège, Belgium (prior to the
dissolution of Hemogenyx-Cell SPRL in 2022) with the head office located in the United Kingdom.
The main assets of the Group, cash and cash equivalents, are held in the United Kingdom, Belgium
and the United States. The Board ensures that adequate amounts are transferred internally to allow
all companies to carry out their operations on a timely basis.
The Group currently has one reportable segment – a biotechnology company focused on the
discovery, development and commercialisation of innovative treatments relating to blood and
immune system disorders and viral infections.
New Accounting Standards and Interpretations issued and applied in the Financial Statements
Amendments to References to the Conceptual Framework in IFRS Standards: included are revised
definitions of an asset and a liability as well as new guidance on measurement and derecognition,
presentation and disclosure.
The Group has applied the following amendments for the first time for the annual reporting period
commencing 1 January 2021:
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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Interest Rate Benchmark Reform – Phase 2, Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and
IFRS 16 became effective from January 1, 2021. These amendments address issues that might affect
financial reporting when an existing interest rate benchmark (i.e. Interbank offered rate – IBOR) is
replaced with an alternative benchmark interest rate. The effects of interest rate benchmark reform
on the Group and Company’s financial instruments and risk management strategies did not have a
material impact on the Group’s consolidated financial statements and are not expected to have a
significant impact in future periods.
On March 31, 2021, the IASB issued COVID-19-Related Rent Concessions beyond June 30, 2021,
an amendment to IFRS 16 effective from August 31, 2021 onwards. The amendment enables lessees,
subject to certain conditions, to opt out of the requirement to determine whether a COVID-19-related
rent concession is a lease modification. Application of this amendment had no material impact on
the Group and Company.
Adoption of the above standards did not have a material impact on the consolidated financial
statements.
New Accounting Standards and Interpretations in issue but not applied in the Financial Statements
The standards and interpretations that are issued, but not yet effective, up to the date of issuance of
the financial statements are listed below. The Group and Company intend to adopt these standards,
if applicable, when they become effective. These are summarised below:
Annual Improvements to IFRS Standards 2018-2020: The pronouncement contains amendments
to four International Financial Reporting Standards (IFRSs) as result of the IASB's annual
improvements project:
▪ IFRS 1 First-time Adoption of International Financial Reporting Standards: subsidiary
as a first-time adopter – The amendment permits a subsidiary that applies paragraph
D16(a) of IFRS 1 to measure cumulative translation differences using the amounts
reported by its parent, based on the parent’s date of transition to IFRSs.
▪ IFRS 9 Financial Instruments – fees in the ‘10 per cent’ test for derecognition of financial
liabilities - The amendment clarifies which fees an entity includes when it applies the ‘10
per cent’ test in IFRS 9 in assessing whether to derecognise a financial liability. An entity
includes only fees paid or received between the entity (the borrower) and the lender,
including fees paid or received by either the entity or the lender on the other’s behalf.
▪ IFRS 16 Leases – Lease incentives – the amendment to Illustrative Example 13
accompanying IFRS 16 removes from the example the illustration of the reimbursement
of leasehold improvements by the lessor in order to resolve any potential confusion
regarding the treatment of lease incentives that might arise because of how lease
incentives are illustrated in that example. Issued 14 May 2020, applicable for annual
periods beginning on or after 1 January 2022 with early application permitted in respect
of IFRS 1, IFRS 9, and IAS 41. The amendment to IFRS 16 only regards an illustrative
example, so no effective date is stated. All subject to EU endorsement.
▪ IAS 41 – This amendment removes the requirement for entities to exclude taxation cash
flows when measuring the fair value of a biological asset using a present value technique.
On 12 February 2021 the IASB issued an amendment to IAS 1 concerning accounting policy
disclosures, and an amendment to IAS 8 concerning the definition of accounting estimates. On 7
May 2021 the IASB issued an amendment to IAS 12 concerning deferred tax related to assets and
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
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liabilities arising from a single transaction. The Company does not expect any material impact from
the application of these two amendments, which are effective for annual reporting periods beginning
on or after 1 January 2023. The Company will not early adopt these amendments.
On 23 January 2020 the IASB issued Classification of Liabilities as Current or Non-current, an
amendment to IAS 1. On 14 May 2020 the IASB issued Reference to the Conceptual Framework, an
amendment to IFRS 3; Proceeds before Intended Use, an amendment to IAS 16; Onerous Contracts
– Cost of Fulfilling a Contract, an amendment to IAS 37; and Annual Improvements to IFRS
standards 2018-2020. The Company does not expect a material impact from those amendments,
which are effective for annual reporting periods beginning on or after 1 January 2022.
The Group has not early adopted any of the above standards and the directors are assessing the impact
on future financial statements. There are no other IFRS or IFRIC interpretations that are not yet
effective that would be expected to have a material impact on the Group or Company.
3.
Significant accounting judgements, estimates and assumptions
The preparation of the financial statements in conformity with International Financial Reporting
Standards requires the use of certain critical accounting estimates. It also requires management to
exercise its judgement in the process of applying the Company’s accounting policies.
Estimates and judgements are continually evaluated, and are based on historical experience and other
factors, including expectations of future events that are believed to be reasonable under the
circumstances. The estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next financial year are
discussed below.
The principal areas in which judgement is applied are as follows:
Convertible debt
The accounting treatment of the shares issued to Arrangers and Introducers of the debt financing
requires the Group to consider the purpose of the issuance of such shares, and whether they directly
relate to the procurement of the debt facility. Shares issued to such Arrangers and Introducers were
a condition of, and therefore judged to be directly related to, the procurement of the debt facility and
were accordingly capitalised. Shares not issued in relation to the debt financing were not capitalised
and were treated as an administrative expense. The fair value of the shares issued was based upon
the quoted price of the Company’s ordinary shares at the date of issuance. The fair value of the shares
issued upon conversion of the debt to ordinary shares was based upon the quoted price of our ordinary
shares at the date of conversion. The difference between such fair value and the amount of the debt
converted plus related accrued interest is considered a debt discount and is recognised as a non-cash
finance charge to the consolidated statement of comprehensive income. See Note 23 for details.
Fair value disclosure
The embedded derivative elements of the convertible notes were measured using a risk-based pricing
model. The computed fair value was not significant in 2021 and 2020. No convertible notes remained
outstanding at 31 December 2021.
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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Valuation of stock options
Management uses the Black Scholes model to value the share options. The model requires use of
assumptions regarding volatility, risk free interest rate, expected term and a calculation of the value
of the option at the time of the grant. The assumptions are based upon current trends and market
factors. Please see Note 20 for details.
Intangible assets impairment
When there is an indicator of a significant and permanent reduction in the value of intangible assets,
an impairment review is carried out. The impairment analysis is principally based on estimated
discounted future cash flows. The determination of the assumptions is subjective and requires the
exercise of considerable judgement about the outcome of research and development activity,
probability of technical and regulatory success, amount and timing of projected future cash flow or
changes in market conditions. Any changes in key assumptions could materially affect whether an
impairment exists. See Note 14 for further details.
4.
Reverse acquisition and LSE listing
On 4 October 2017, the Company acquired the entire issued share capital of Hemogenyx
Pharmaceuticals LLC, a private company incorporated in the United States, by way of a share for
share exchange. In substance, the shareholders of Hemogenyx Pharmaceuticals LLC acquired a
controlling interest in the Company and the transaction has therefore been accounted for as a reverse
acquisition. Following the completion of the transaction the Company changed its name to
Hemogenyx Pharmaceuticals plc.
The reverse acquisition reserve that arose from the reverse takeover is £6,157,894 at 31 December
2021 and 2020 and is made up of the following:
Components
£
Pre-acquisition losses of Hemogenyx Pharmaceuticals plc1
(799,763)
Hemogenyx Pharmaceuticals LLC issued capital at acquisition2
1,010,849
Investment in Hemogenyx Pharmaceuticals LLC3
(8,000,000)
Reverse acquisition expense4
1,631,020
As at 31 December 2021 and 2020
(6,157,894)
The movements on the Reverse acquisition reserve are as follows:
(1) These consolidated financial statements present the legal capital structure of the Company.
However, under reverse acquisition accounting rules, the Company was not acquired until 4 October
2017 and therefore the entry above is required to eliminate the initial retained losses of the Company.
(2) Hemogenyx Pharmaceuticals LLC had issued share capital of equivalent to £1,010,849 as at 4
October 2017. As these financial statements present the capital structure of the parent entity, the
issue of equity by Hemogenyx Pharmaceuticals LLC has been recorded in this reserve.
(3) The Company issued 228,571,428 shares at £0.035 each, totalling £8,000,000 for the entire issued
capital of Hemogenyx Pharmaceuticals LLC. The above entry is required to eliminate the balance
sheet impact of this transaction.
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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62
(4) The entry above represents the difference between the value of the equity issued by the Company,
and the deemed consideration given by Hemogenyx Pharmaceuticals LLC to acquire the Company.
5.
Segment Information
The Group has one reportable segment, the discovery, development and commercialisation of
innovative treatments relating to blood and immune system disorders and viral infections, and
administrative functions in the United Kingdom, and therefore the segmental information is the same
as that presented in the primary statements.
The following tables present expenditure and certain asset information regarding the Group’s
geographical segments for the year ended 31 December 2021 and 2020:
Year Ended
31 December
2021
Year Ended
31 December
2020
£
£
SEGMENT ASSETS
United Kingdom
- Non-current
-
213,472
- Current
126,723
1,097,662
United States
- Non-current
1,381,221
533,841
- Current
6,992,630
798,515
Belgium
- Non-current
-
-
- Current
19,834
21,094
Total
- Non-current
1,381,221
747,313
- Current
7,139,187
1,917,271
CAPITAL EXPENDITURE
United Kingdom
-
-
United States
636,255
173,047
Belgium
-
-
636,255
173,047
Capital expenditure consists of the purchase of property and equipment.
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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63
6.
Expenses by nature
Group
Group
Year Ended 31
December 2021
Year Ended 31
December 2020
£
£
Laboratory expenses
37,583
83,662
Consumable equipment and supplies
283,647
267,057
Contractors & consultants
468,505
(1,459)
Travel
10,603
4,218
Staff Costs
1,023,783
1,130,764
Insurance
56,363
39,303
Other
285,844
80,187
Legal and professional fees
537,954
505,812
Foreign exchange loss/(gain)
(127,868)
(65,910)
Total Administrative Expenses
2,576,414
2,043,633
7.
Other income
Other income during the period ended 31 December 2021 totals £171,875 (2020: £85,537)
comprising £71,932 arising from the forgiveness of a US governmental loan programme (the Payroll
Protection Program) in 2021 and £99,943 received from a third party under a research collaboration
programme relating to humanised mice.
8.
Employees
Group
Group
Company
Company
Year Ended 31
December 2021
Year Ended 31
December 2020
Year Ended 31
December 2021
Year Ended 31
December
2020
£
£
£
£
Wages and salaries
810,851
713,790
115,000
208,750
Social security
41,377
37,732
1,408
2,506
Share based
Payments
153,356
363,104
137,390
363,104
Pension
contributions
18,199
16,138
-
250
1,023,783
1,130,764
253,798
574,610
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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64
Average number of people (including Executive Directors) employed:
Group
Group
Company
Company
Year Ended
31 December
2021
Year Ended
31 December
2020
Year Ended
31 December
2021
Year
Ended 31
December
2020
Research &
development
7
5
-
-
Administration
3
3
2
2
10
8
2
2
9.
Auditor’s remuneration
Group
Group
Year Ended
31 December
2021
Year Ended
31 December
2020
£
£
Fees payable to the Company auditor:
Audit of the financial statements of the Group and
Company
45,000
45,090
Other services
3,500
-
48,500
45,090
10.
Income tax
Group
Group
Year Ended 31
December 2021
Year Ended 31
December 2020
£
£
Current Tax:
Tax on loss on ordinary activities
-
-
Loss on ordinary activities before tax
(5,108,310)
(2,095,023)
Analysis of charge in the year:
Loss on ordinary activities multiplied by
weighted average tax rate for the group of
22.40% (2020: 23.10%)
(1,145,371)
(483,950)
Disallowed items
81,735
116
US R&D credit and timing differences
(136,371)
68,990
Tax losses carried forward
(1,200,007)
(414,844)
Current tax credit
-
-
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
65
65
Weighted average tax rate is calculated by reference to the tax rates effective in each of the
jurisdictions. The tax rates effective at 31 December 2021 are 19%, 28% and 28% in the UK, the
USA and Belgium respectively.
The Group has accumulated tax losses arising in the UK of approximately £4,450,000 (2020:
£1,447,000) that should be available, under current legislation, to be carried forward against future
profits. No deferred tax asset has been recognised against these losses. The Group has tax losses
carried forward in the US of approximately US$6,700,000 available under current rules until 2037.
No deferred tax asset has been recognised against these losses.
Sections 382 and 383 of the US Internal Revenue Code, and similar state regulations, contain
provisions that may limit the tax loss carried forward available to be used to offset income in any
given year upon the occurrence of certain events, including changes in the ownership interests of
significant stockholders. In the event of a cumulative change in ownership in excess of 50% over a
three-year period, the amount of the NOL carry forwards that the Company may utilise in any one
year may be limited.
11.
Earnings per share
The calculation of the basic and fully diluted earnings per share is calculated by dividing the loss for
the year from continuing operations attributable to equity owners of the Group of £(5,099,228) (2020:
£(2,082,220)) by the weighted average number of ordinary shares in issue during the year of
773,952,166 (2020: 414,833,093).
Dilutive loss per Ordinary Share equals basic loss per Ordinary Share as, due to the losses incurred
in 2021 and 2020, there is no dilutive effect from the subsisting share options. See Note 20 for
details of stock options and warrants outstanding.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
66
66
12.
Property and equipment
Group
Property &
equipment
Computer
equipment
Leasehold
Improvements
Total
£
£
£
£
Cost
31 December 2019
270,114
5,379
-
275,493
Additions
167,007
6,040
-
173,047
Foreign exchange movement
(12,013)
(462)
-
(12,475)
31 December 2020
425,108
10,957
-
436,065
Additions
-
8,508
627,747
636,255
Foreign exchange movement
5,063
263
16,408
21,734
31 December 2021
430,171
19,728
644,155
1,094,054
Accumulated depreciation and
impairment losses
31 December 2019
150,336
1,235
-
151,571
Depreciation
67,499
2,360
-
69,859
Foreign exchange movement
(8,052)
(171)
-
(8,223)
31 December 2020
209,783
3,424
-
213,207
Depreciation
84,645
5,322
-
89,967
Foreign exchange movement
2,881
112
-
2,993
31 December 2021
297,309
8,858
-
306,167
Carrying amounts
31 December 2019
119,778
4,144
-
123,922
31 December 2020
215,325
7,533
-
222,858
31 December 2021
132,862
10,870
644,155
787,887
13.
Leases
The Group follows IFRS 16 with respect to its leases, whereby the Group recognises right-of-use
assets and lease liabilities for all leases on its balance sheet. Each of the two US subsidiaries has an
agreement for the lease of laboratory facilities to which IFRS 16 has been applied.
The key impacts on the Statement of Comprehensive Income and the Statement of Financial Position
are as follows:
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
67
67
Group & Company
Right of use
asset
£
Lease liability
£
Income
statement
£
Carrying value at 31
December 2019
109,442
(113,088)
(44,808)
Depreciation
(36,894)
-
(36,894)
Revaluation
(23,777)
32,031
-
Interest
-
(3,637)
(3,637)
Lease payments
-
39,431
-
Foreign exchange
movements
(2,886)
(3,491)
-
Carrying value at 31
December 2020
45,885
(48,754)
(40,531)
Depreciation
(36,373)
-
(36,373)
Interest
-
(1,560)
(1,560)
Lease payments
-
39,079
-
Foreign exchange
movements
(270)
1,083
-
Carrying value at 31
December 2021
9,242
(10,152)
(37,932)
14.
Intangible assets
On 15 January 2015, the Company entered into an Exclusive License Agreement with Cornell
University to grant to the Company patent rights to patent PCT/US14/65469 entitled Post-Natal
Hematopoietic Endothelial Cells and Their Isolation and Use and rights to any product or method
deriving therefrom. The Company paid Cornell University USD $347,500 for such licence rights.
In October 2021, the Company entered into a licence with Eli Lilly and Company to use a patented
product relating to the CDX antibody for a term ending on the latest of (a) the twelfth (12th)
anniversary of the date of First Commercial Sale of a particular Licensed Product in a particular
country; (b) the first day on which there is not at least one Licensed Patent having a Valid Claim
Covering the manufacture, use, or sale of such Licensed Product in such country; or (c) the
expiration of the last-to-expire Data Exclusivity Period for such Licensed Product in such country.
The Company paid £181,743 GBP or $250,000 USD as an up-front payment and will make
milestone payments of up to $1 million through to Phase II clinical trials. Lilly is also eligible to
receive substantial additional milestone payments based on the achievement of prespecified
milestones, as well as tiered single-digit royalties on sales and a percentage of any cash payments
received in respect of any sublicence of the licensed intellectual property. Through 31 December
2021, the Company has not incurred any development or sales-based payment obligations to the
licensor.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
68
68
Cost
Intellectual
Property
£
31 December 2019
262,050
Exchange movements
(7,095)
31 December 2020
254,955
Additions
181,743
Exchange movements
4,795
31 December 2021
441,493
The carrying value of intangible assets is reviewed for indications of impairment whenever events
or changes in circumstances indicate that the carrying value may exceed the recoverable amount. The
products to which they relate are not ready to be sold on the open market. When the trials are
completed and the products attain the necessary accreditation and clearance from the regulators, the
Group will assess the estimated useful economic life and the IP will be amortised using the straight-
line method over their estimated useful economic lives. The directors are of the view that no
impairment is required as the test results to date have been very positive and these products are now
being moved on towards the clinical trial phase. Accordingly, the directors continue to believe that
the products will eventually attain the necessary accreditation and clearance from the regulators and
so no impairment has been considered necessary.
Amortisation will be charged to operating costs in the Statement of Comprehensive Income when
the Group achieves product sales.
15.
Loan to subsidiary
Company
Company
31 December
2021
£
31 December
2020
£
Loan to Hemogenyx
Pharmaceuticals LLC
13,213,951
2,765,500
Loan to Immugenyx LLC
556
551
13,214,507
2,766,051
Hemogenyx Pharmaceuticals plc has made cumulative loans to Hemogenyx Pharmaceuticals LLC
of US$17,883,274 (£13,213,951) as at 31 December 2021 (Dec 2020: (US$3,769,332 (£2,765,500))
and Immugenyx LLC of US$17,883,274 (£13,213,951) as at 31 December 2021 (Dec 2020: (US$752
(£551)). The loans are interest free and will be repaid when Hemogenyx LLC’s operational cash
flow allows. Management has undertaken an impairment assessment of the loan as at 31 December
2021 and has determined that that there was no impairment required. The interest rate and impairment
assessment are reviewed on an annual basis.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
69
69
16.
Investment in subsidiary
Name
Address of the registered
office
Nature of
business
Proportion of
ordinary
shares held
directly by
parent (%)
Proportion of
ordinary
shares held
ultimately by
parent (%)
Hemogenyx UK
Limited
5 Fleet Place, London, UK
EC4M 7RD
Holding
Company
100
-
Hemogenyx
Pharmaceuticals
LLC
9 East Lookerman Street,
Suite 3A, Dover, Kent,
Delaware, USA, 19901
Biomedical
sciences
-
100
Immugenyx LLC
c/o Corporation Service
Company
251 Little Falls Drive,
Wilmington, Delaware,
USA, 19808
Biomedical
sciences
-
93.9
Hemogenyx-Cell
SPRL (dissolved in
2022)
Avenue du Parc Industriel
89, 4041 Milmort,
Belgique
Biomedical
sciences
-
100
The remaining shares in Immugenyx LLC are held by Dr Vladislav Sandler and by a prior employee,
Carina Sirochinsky, as part of their compensation under their respective roles as CEO and Director
of Operations. Ms Sirochinsky’s role as Director of Operations ended on the termination of her
employment on 1 July 2021. Dr Sandler and Ms Sirochinsky receive(d) 10,000 and 1,000 shares
respectively for each year of employment from January 2019. At 31 December 2021, Hemogenyx
Pharmaceuticals LLC, Dr Sandler and Ms Sirochinsky each owns 500,000, 30,000 and 2,500 shares
in Immugenyx LLC, respectively.
17.
Trade and other receivables
Group
Group
Company
Company
31 December
2021
31 December
2020
31 December
2021
31 December
2020
£
£
£
£
VAT receivable
6,127
50,971
6,127
50,971
Trade and other receivables
1,386
5,297
-
-
Prepayments
290,707
48,704
9,351
10,477
Total trade and other receivables
298,220
104,972
15,478
61,448
There are no material differences between the fair value of trade and other receivables and their
carrying value at the year-end. No receivables were past due or impaired at the year-end.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
70
70
18.
Called up share capital
Group & Company
Number of shares
£
As at 31 December 2019
361,242,853
3,612,429
Issue of shares – placement
71,725,402
717,254
Issue of shares – warrant exercise
668,000
6,680
As at 31 December 2020
433,636,255
4,336,363
Conversion of debt to issue of shares – placement 25 Feb 2021
13,131,313
131,313
Conversion of debt to issue of shares – placement 26 Mar 2021
14,285,714
142,857
Conversion of debt to issue of shares – placement 16 Apr 2021
24,547,803
245,478
Conversion of debt to issue of shares – placement 26 Apr 2021
29,850,746
298,508
Conversion of debt to issue of shares – placement 5 May 2021
22,222,222
222,222
Conversion of debt to issue of shares – placement 18 May 2021
433,333,333
4,333,333
Shares issued as arrangement fees for debt issuance
7,741,935
77,419
Shares issued to consultant
1,000,000
10,000
As at 31 December 2021
979,749,321
9,797,493
During 2020, the Company raised £648,200 before expenses through a placing and subscription of
36,011,116 ordinary shares at a price of 1.8p per share. The Company also raised £2,500,000 before
expenses through a placing and subscription of 35,714,286 ordinary shares at a price of 7p per share.
The Company received £35,070 from the exercise of 668,000 warrants at an exercise price of 5.25p
per share.
During 2021, the Company issued 546,113,066 ordinary shares upon conversion of debt – See Note
20.
19.
Share premium
Group & Company
£
As at 31 December 2019
7,699,789
Issue of shares – placement
2,430,946
Share issuance costs
(168,160)
Issue of share – warrant exercise
28,390
As at 31 December 2020
9,990,965
Issue of shares – placement
5,548,969
Issues of shares – consultant
66,337
Charge recognised upon conversion of debt
1,212,475
As at 31 December 2021
16,808,647
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
71
71
20.
Other reserves
Group:
Year Ended 31
December 2021
Year Ended 31
December 2020
£
£
As at start of year
764,815
399,229
Charge for the year - employees
153,355
363,104
Convertible Note embedded derivative
(13,944)
2,482
As at end of year
904,226
764,815
Company:
Year Ended 31
December 2021
Year Ended 31
December 2020
£
£
As at start of year
749,767
386,663
Charge for the year - employees
153,355
363,104
As at end of year
903,122
749,767
The expense recognised for employee and non-employee services during the year is shown in the
following table:
Group and Company:
Year Ended 31
December 2021
Year Ended 31
December 2020
£
£
Expense arising from equity-settled share-based payment
transactions
153,355
363,104
Total expense arising from share-based payment transactions
153,355
363,104
Employee Plan
Under the Employee Plan (“EMP”) share options are granted to directors and employees at the
complete discretion of the Company. The fair value of the options is determined by the Company at
the date of the grant. Options granted vest in tranches on each of the following events/dates:
(i) Admission to the LSE (“Admission”);
(ii) On the date falling six (6) months after Admission;
(iii) On the date falling twelve (12) months after Admission; and
(iv) On the date falling twenty-four (24) months after Admission
On the provision that the option holder remains an employee of the Group.
Options granted to most other option holders from 4 January 2018 onwards vest in equal tranches of
12.5% every three months from the date of grant, until fully vested.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
72
72
The fair value of the options is determined using the Black Scholes method as stated in Note 2. The
contractual life of each option granted is between two and five years. There are no cash settlement
alternatives.
Options are settled when the Company receives a notice of exercise and cash proceeds from the
option holder equal to the aggregate exercise price of the options being exercised.
Non-Employee Plan
Under the Non-Employee Plan (“NEMP”) share options are granted to non-employees at the
complete discretion of the Company. The exercise price of the options is determined by the Company
at the date of the grant. The options vest at the date of the grant.
The fair value of the options is determined using the Black Scholes method as stated in Note 2 and
not the value of services provided as this is deemed the most appropriate method of valuation. In all
cases non-employee option holders received cash remuneration in consideration for services
rendered in accordance with agreed letters of engagement. The contractual life of each option granted
ranges from two to five years. There are no cash settlement alternatives. Volatility was determined
by calculating the volatility for three similar listed companies and applying the average of the four
volatilities calculated.
Options are settled when the Company receives a notice of exercise and cash proceeds from the
option holder equal to the aggregate exercise price of the options being exercised.
2021 Equity Incentive Plan with Non-Employee Sub-Plan
Under the 2021 Equity Incentive Plan with Non-Employee Sub-Plan” (the “EIP”) share options,
restricted shares, and restricted share units may be granted to employees, directors and consultants
of the Company and its subsidiaries at the discretion of the Company in an aggregate amount up to
30,000,000 shares. The fair value of awards made under this plan is determined in the same way as
for the EMP and NEMP described above.
A schedule of options granted is below:
Number options
Employees, including directors*
30,844,314
Members of the Scientific Advisory Board
14,237,192
Total
45,081,506
* Details of options held by individual directors are disclosed in the Directors’ Report.
Group & Company:
2021
Number
2021
Weighted
Average
Exercise
Price pence
2020
Number
2020
Weighted
Average
Exercise
Price pence
Outstanding at the beginning of the year
42,465,787
4.6
30,553,076
3.5
Granted during the year
3,090,441
2.1
11,912,711
7.4
Lapsed during the year
(474,722)
9.0
-
-
Cancelled during the year
-
-
-
-
Outstanding at end of year
45,081,506
4.4
42,465,787
4.6
Exercisable at end of year
43,278,749
3.5
36,812,610
4.5
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
73
73
The weighted average remaining contractual life for the share options outstanding as at 31 December
2021 is 2.08 years (2020: 2.52 years). The weighted average fair value of options granted during the
year was 0.7 pence (2020: 4.2 pence).
The following table lists the inputs to the models used for the two plans for the years ended 31
December 2021 and 31 December 2020:
July 2021
(EMP)
July-Aug 2020
(EMP)
Expected volatility %
65
64-75
Risk-free interest rate %
0.17
0.52-1.0
Expected life of options
(years)
3
5
WAEP – pence
2.1
7.4
Expected dividend yield
-
-
Model used
Black Scholes
Black Scholes
Warrants
In connection with the share placement that completed on 4 October 2017, warrants were also issued
to the brokers who raised funds for that share placement. The warrants were equal in value to 2% of
the total number of new shares issued for the funds raised by each broker, exercisable at £0.0525 per
warrant for a term of three years from the date of the placing, as prescribed in the Company’s 2017
prospectus. Optiva exercised 668,000 warrants in May 2020. No warrants were issued in 2021 and
no warrants remain outstanding as at 31 December 2021.
21.
Capital and reserves
The nature and purpose of equity and reserves are as follows:
Share capital comprises the nominal value of the ordinary issued share capital of the Company.
Share premium represents consideration less nominal value of issued shares and costs directly
attributable to the issue of new shares.
Other reserves represents the value of options in connection with share-based payments, warrants
connected with share placements issued by the Company, and the value of the deemed embedded
derivative connected with the Convertible Note liability.
Reverse asset acquisition reserve is the reserve created in accordance with the acquisition of
Hemogenyx Pharmaceuticals LLC on 5 October 2017.
Foreign currency translation reserve is used to recognise the exchange differences arising on
translation of the assets and liabilities of foreign branches and subsidiaries with functional currencies
other than Pounds Sterling, as well as the revaluation of intercompany loans.
Retained earnings represent the cumulative retained losses of the Company at the reporting date.
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
74
74
22.
Trade and other payables
Group
Group
Company
Company
31 December
2021
31 December
2020
31 December
2021
31 December
2020
£
£
£
£
Trade and other payables
295,829
113,241
87,569
88,853
Accruals and deferred income
46,860
47,530
46,860
47,527
Total
342,689
160,771
134,429
136,380
Current liabilities
342,689
160,771
134,429
136,380
23.
Borrowings
The borrowings are comprised of borrowings and convertible notes. The Group follows IFRS 9, and
as a result, where the instruments contained liability classified embedded derivatives, an election was
taken to fair value the entire financial instrument through profit or loss rather than split out the
embedded derivative. At 31 December 2020, all borrowings were classified as current due to their
maturity being less than 12 months from the balance sheet date. At 31 December 2021, there were
no borrowings outstanding. Costs incurred in 2020 related to procuring the Mint facility in 2021 were
classified as deferred financing costs on the consolidated statement of financial position at 31
December 2020. The notes payable consist of the following:
Group & Company
Year Ended 31
December 2021
Year Ended 31
December 2020
£
£
Borrowings
Balance at 1 January
753,717
571,628
Drawdowns
-
191,146
Paydowns
(791,641)
-
Interest expense
14,354
15,206
Value of embedded derivative transferred to Other Reserves
6,972
(1,033)
Foreign exchange movement
16,598
(23,230)
Balance at 31 December
-
753,717
Convertible Notes
Balance at 1 January
753,065
572,539
Drawdowns
-
191,161
Paydowns
(791,641)
-
Interest expense
14,300
15,272
Value of embedded derivative transferred to Other Reserves
6,972
(941)
Foreign exchange movement
17,304
(24,966)
Balance at 31 December
-
753,065
Balance at 1 January
72,596
-
Payroll Protection Loan borrowing
-
79,469
Payroll Protection Loan forgiveness
(71,932)
-
Foreign exchange movement
(664)
(6,873)
Balance at 31 December
-
72,596
Total Borrowings at 31 December
-
1,579,378
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
75
75
A summary of the debt facilities is as follows:
Mint Transactions
In November 2020, Mint Capital Limited (“Mint”) and the Company entered into a Financing
Facility agreement (“Financing Facility”) whereby Mint conditionally agreed to subscribe for up to
£60 million in aggregate principal amount of Convertible Loan Notes pursuant to an agreement
entered into with the Company (the “Subscription Agreement”). The shareholders of the Company
approved the facility in January 2021 and a prospectus was published on 29 January 2021.
The key terms of the Convertible Loan Notes included:
▪ A principal amount of up to £60,000,000, split into denominations of £50,000 per Convertible
Loan Note. The Convertible Loan Notes were to be subscribed for at par.
▪ The Convertible Loan Notes were to be issued in up to nine tranches. A tranche of £12,000,000
in principal amount was issued on 3 February 2021. The subsequent eight tranches were to be
issuable at the sole discretion of, and in the amounts determined by, the Company at respective
intervals of 90 days after the Initial Issue Date. The aggregate maximum principal amount of the
Convertible Loan Notes was limited to £60,000,000.
▪ No interest was payable on the Convertible Loan Notes.
▪ The Convertible Loan Notes were unsecured.
▪ Each tranche of Convertible Loan Notes issued was to be redeemable at par on the date falling
36 months after the relevant Issue Date (the “Maturity Date”).
▪ Each of the Convertible Loan Notes was convertible into ordinary shares of £0.01 (1 pence) each
in the capital of the Company (“Ordinary Shares”) at any time during the period commencing on
the fifth business day following the relevant Issue Date and ending at 5.00 p.m. London time on
the business day immediately prior to the relevant Maturity Date (the “Conversion Period”).
▪ The price used for the conversion (the “Conversion Price”) was equal to a 10 per cent discount
to the lesser of (i) 125 per cent. of the closing-bid price as reported by Bloomberg for one
Ordinary Share one trading day before the relevant Issue Date (subject to adjustment to reflect
any sub-division or consolidation of the Ordinary Shares) and (ii) the lowest closing bid-price as
reported by Bloomberg for an Ordinary Share from the three consecutive trading days ending on
the day prior to the date of service of the relevant conversion notice (or if such conversion notice
was served after 4.35pm on any such date, then the three consecutive trading days ending on the
day such conversion notice was served. In no event was the Conversion Price to be less than the
nominal value of an Ordinary Share.
▪ A holder was not permitted to submit a conversion notice in respect of the Convertible Loan
Notes if the total Ordinary Shares held by the holder following the execution of such conversion
notice would exceed 29.9% of the Company’s total Ordinary Shares.
▪ If the Company were to commit an “event of default” then the notes could be redeemed at 114-
120% of the principal amount of the convertible loan at the option of the holder.
▪ The Company had the ability to redeem the convertible loan under certain circumstances at 114%
of the principal amount of the convertible loan.
▪ Subject to limited exceptions, the Convertible Loan Notes were not transferable.
▪ Prior to conversion, the Convertible Loan Notes did not entitle the holder to any voting rights in
the Company.
Arrangement fee
The Company agreed to pay a fee of 5% of the aggregate principal value of the Convertible Loan
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
76
76
Notes issued to the arranger for the Facility (the “Arranger”). The company issued 7,741,935 shares
in February 2021 as an arrangement fee to the arranger of the Financing Facility.
Draw Down
The Company received £12,000,000 from the first drawn down of the Financing Facility agreement
in February 2021. The price of the conversion of the convertible loan notes issued under the
Financing Facility agreement into common shares of the Company, as defined by the Financing
Facility agreement, was the lesser of (i) 8.4375p and (ii) 90% of the lowest closing bid price as
reported on Bloomberg from the three closing bid prices immediately preceding a conversion.
The Company received a conversion notice from Mint in respect of £650,000 in principal amount of
Convertible Loan Notes and issued 13,131,313 shares to Mint in March 2021. Further conversion
notices were received from Mint in respect of £900,000 and £950,000 in principal amount of
Convertible Loan Notes. The Company issued a further 14,285,714 shares to Mint in March 2021,
and 24,547,803 shares in April 2021; both of these allotments of shares were admitted to trading on
the London Stock Exchange’s main market in April 2021. Further conversion notices were received
from Mint in respect of £900,000 and £500,000 in principal amount of Convertible Loan Notes. The
Company issued a further 29,850,746 shares to Mint in April 2021, and 22,222,222 shares in May
2021; both of these allotments of shares were admitted to trading on the London Stock Exchange’s
main market in May 2021.
The Company located a new investor to purchase the remaining position of Mint and received a
conversion notice from the new investor in respect of £6,500,000 in principal amount of Convertible
Loan Notes and issued 433,333,333 shares to such investor in May 2021. The Company repaid the
remaining £1,600,000 under the facility and the facility was terminated.
During the year ended 31 December, 2021, the Company recognised £3,883 of financing related
costs related to the stated interest rate on the convertible debt through the date of conversion or
repayment. During the year ended 31 December, 2021, the Company recognized £1,343,245 of
financing related costs, including the fair value of the shares issued to arrangers to obtain the credit
facility from Mint. During the year ended 31 December, 2021, the Company also recognised
£1,208,592 of non-cash financing related costs representing the fair value of shares issued in excess
of the outstanding principal and accrued interest at the date of the conversion.
Convertible Loan Facilities
During 2018 Orgenesis entered in to two debt facility agreements with the Group, one each with
Hemogenyx Pharmaceuticals LLC and Immugenyx LLC:
1) On 7 November 2018 the Group entered into a loan agreement with Orgenesis Inc., an
organisation with which the Group had a collaboration agreement. The loan amount was for not
less than US$1,000,000 with the proceeds of the loan to be used solely for the development of
the cell therapy technology in accordance with the plan of the collaboration agreement.
Drawdowns totalling US$1,000,000 had been made with Hemogenyx Pharmaceuticals LLC
receiving the funds. The loan carried an interest rate of 2% and had a term of three years.
Orgenesis had the option to convert both principal and accrued interest into equity in
Hemogenyx-Cell at any time prior to maturity. Hemogenyx-Cell SPRL (“Hemo-Cell”) was a
wholly owned Belgian entity (dissolved in 2022) and was incorporated in April 2019 at which
point this loan facility was treated as a borrowing in accordance with the provisions of IAS39.
The loan was repaid in full in November 2021.
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Annual Report & Financial Statements for the
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2) On 7 November 2018 the Group entered into a loan agreement, through its wholly owned
subsidiary Immugenyx LLC, with Orgenesis Inc., an organisation with which the Group had a
collaboration agreement. The loan amount was for not less than US$1,000,000 with the proceeds
of the loan to be used solely for the development of the cell therapy technology in accordance
with the plan of the collaboration agreement. Drawdowns totalling US$1,000,000 had been made.
The loan carried an interest rate of 2% and had a term of three years. Orgenesis had the option to
convert both principal and accrued interest into equity in Immugenyx LLC at any time prior to
maturity. This loan has been treated in accordance with the provisions of IAS39. The loan was
repaid in full in November 2021.
In November 2021 the Company repaid a total of US$2,110,761 (£1,583,281) in principal and
interest to settle the convertible loan facilities from Orgenesis Inc.
Paycheck Protection Program Loan
On 1 May 2020, the Company received loan proceeds in the amount of $98,947 under the Paycheck
Protection Program (“PPP”). The PPP, established as part of the Coronavirus Aid, Relief and
Economic Security Act, as amended (“CARES Act”), provides for loans to qualifying businesses for
amounts up to 2.5 times of the average monthly payroll expenses of such qualifying business. The
loans and accrued interest are forgivable after certain time periods further defined in the CARES Act
(the “Covered Period”) as long as the borrower uses the loan proceeds for eligible purposes, including
payroll, benefits, rent and utilities, and maintains its payroll levels. The amount of loan forgiveness
will be reduced if the borrower terminates employees or reduces salaries during the Covered Period.
The loan was forgiven in April 2021 by being converted into a grant at the election of the Company.
The Company qualified for this conversion as at least 60% of the amount of the loan was applied to
payroll expenditure and there was no reduction in employee headcount, and it was therefore included
in other income.
24.
Related party disclosures
There were no related party disclosures other than Directors’ remuneration as disclosed in the
Remuneration Report section of the Directors’ Report. There are no key management personnel other
than the Directors and the Company Secretary.
25.
Financial instruments
The Group’s financial instruments consist of cash, amounts receivable, accounts payable and accrued
liabilities and deferred payment.
Fair value of financial assets and liabilities
Fair values have been determined for measurement and/or disclosure purposes based on the following
methods. When applicable, further information about the assumptions made in determining fair
values is disclosed in the notes specific to that asset or liability.
The carrying amount for cash, accounts receivable, and accounts payable and accrued liabilities on
the statement of financial position approximate their fair value because of the limited term of these
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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instruments. The fair value of deferred payment approximates its fair value. The investment is carried
at cost as it is not traded on an active market.
Fair value hierarchy
Financial instruments that are measured subsequent to initial recognition at fair value are grouped in
Levels 1 to 3 based on the degree to which the fair value is observable:
• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active
markets for identical assets or liabilities; and
• Level 2 fair value measurements are those derived from inputs other than quoted prices included
within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or
indirectly (i.e. derived from prices); and
• Level 3 fair value measurements are those derived from valuation techniques that include inputs
for the asset or liability that are not based on observable market data (unobservable inputs).
The Group did not have any financial instruments in Level 1, 2 and 3.
Financial risk management objectives and policies
The Company has exposure to the following risks from its use of financial instruments:
• Credit risk
• Liquidity and funding risk
• Market risk
The following table sets out the amortised costs categories of financial instruments held by the
Company as at the year ended 31 December 2021 and year ended 31 December 2020:
Group
Group
Company
Company
31 December
2021
31 December
2020
31 December
2021
31 December
2020
£
£
£
£
Assets
Trade and other receivables,
except prepayments and VAT
1,696
5,296
310
-
Cash and cash equivalents
6,840,969
1,812,299
111,245
1,036,214
6,842,665
1,817,595
111,555
1,036,214
Liabilities
Trade and other payables
(295,829)
(113,241)
(87,569)
(88,853)
Lease liabilities
(10,152)
(48,754)
-
-
Borrowings
-
(1,579,378)
-
-
(305,981)
(1,707,741)
(87,569)
(88,853)
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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79
Group
1 January
2021
Cash flows
Non-cash changes
31
December
2021
Adjustment to
reserve
PPP Loan
Forgiveness
Foreign
exchange
movements
Interest
charge
Short-term
borrowings
(1)
1,579,378
(1,583,281)
13,944
(71,932)
33,237
28,654
-
Long-term
borrowings
-
-
-
-
-
-
-
Total
1,579,378
(1,583,281)
13,944
(71,932)
33,237
28,654
-
Group
1 January
2020
Cash flows
Non-cash changes
31
December
2020
Reclassification
to reserve
Foreign exchange
movements
Interest
charge
Short-term
borrowings
(1)
1,144,167
461,776
(1,891)
(54,949)
30,275
1,579,378
Long-term
borrowings
-
-
-
-
-
-
Total
1,144,167
461,776
(1,891)
(54,949)
30,275
1,579,378
(1) Borrowings reclassified to short term since all balance are due within twelve months of
December 31, 2020. At December 31, 2021 the principal and interest on borrowings was paid
in full.
a)
Credit risk
The Group had receivables of £0 owing from customers (31 December 2020: £3,668). All bank
deposits are held with Financial Institutions with a minimum credit rating of B+.
b)
Liquidity and funding risk
The Group regularly reviews its major funding positions to ensure that it has adequate financial
resources in meeting its financial obligations. The Group takes liquidity risk into consideration when
deciding its sources of funds. The principle liquidity risk facing the business is the risk of going
concern which has been discussed in Note 2.
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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80
c)
Market risk
Interest rate risk
Interest rate risk is the risk that the value of financial instruments will fluctuate due to changes in
market interest rates. The Group's income and operating cash flows are substantially independent of
changes in market interest rates as the Group has no significant interest-bearing assets. The
borrowings issued at fixed rates expose the Group to fair value interest rate risk. The Company's
management monitors the interest rate fluctuations on a continuous basis and acts accordingly.
The Company has floating rate financial assets in the form of deposit accounts with major banking
institutions; however, it is not currently subjected to any other interest rate risk.
Based on cash balances as above as at the statement of financial position date, a rise in interest rates
of 1% would not have a material impact on the profit and loss of the Company and such is not
disclosed.
The interest rates on the Convertible Notes are fixed and hence a rise in interest rates of 1% would
not have a material impact on the profit and loss of the Group and such is not disclosed.
In relation to sensitivity analysis, there was no material difference to disclosures made on financial
assets and liabilities.
At the reporting date the interest rate profile of interest-bearing financial instruments was:
Group
Group
Company
Company
31 December
2021
31 December
2020
31 December
2021
31 December
2020
£
£
£
£
Financial Assets
Cash and cash equivalents
6,840,969
1,812,299
111,245
1,036,214
Financial Liabilities
Borrowings
-
(1, 579,378)
-
-
Foreign currency risk
The Group operates internationally and has monetary assets and liabilities in currencies other than
the functional currency of the operating company involved.
The Group seeks to manage its exposure to this risk by ensuring that where possible, the majority of
expenditure and cash of individual subsidiaries within the Group are denominated in the same
currency as the functional currency of that subsidiary.
The Group has not entered into any derivative instruments to manage foreign exchange fluctuations.
The following table shows a currency of net monetary assets and liabilities by functional currency of
the underlying companies for the years ended 31 December 2021 and 31 December 2020:
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
81
81
31 December 2021
Functional Currency
Currency of net
monetary
assets/(liabilities)
Pounds
Sterling
£
US Dollars
£
Euro
£
Total
£
Pounds Sterling
99,050
-
-
99,050
US Dollars
12,197
6,709,888
-
6,722,085
Euros
-
-
19,834
19,834
Total
111,245
6,709,888
19,834
6,840,969
31 December 2020
Functional Currency
Currency of net
monetary
assets/(liabilities)
Pounds Sterling
£
US Dollars
£
Euro
£
Total
£
Pounds Sterling
1,024,010
-
-
1,024,010
US Dollars
12,204
(70,670)
-
(58,466)
Euros
-
-
(753,623)
(753,623)
Total
1,036,214
(70,670)
(732,623)
232,920
Capital risk management
The Group defines capital as the total equity of the Company. The Group’s objectives when
managing capital are to safeguard the Group’s ability to continue as a going concern in order to
provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital
structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid
to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
Fair value of financial assets and liabilities
There are no material differences between the fair value of the Group’s financial assets and liabilities
and their carrying values in the financial statements.
26.
Commitments
Licences
Milestone and royalty payments that may become due under licence agreements are dependent on,
among other factors, clinical trials, regulatory approvals and ultimately the successful development
of new drugs, the outcomes and timings of which are uncertain.
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Annual Report & Financial Statements for the
Year Ended 31 December 2021
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For the licence from Cornell University to the patent of the Hu-PHEC technology, the Group’s
minimum future payments contingent upon meeting certain development, regulatory and
commercialisation milestones total £764,762 ($1,035,000) plus £369,450 ($500,000) on receipt of
marketing approval from each additional market excluding the United States of America and the
European Union. Upon commencement of commercial production, the Group will pay a royalty
between 2 to 5% on all net sales. In addition, the Group pays an annual licence maintenance fee of
up to £55,418 ($75,000) until the commercial sales are achieved.
For the licence to Eli Lilly and Company’s (“Lilly”) contributions to the intellectual property in the
CDX bispecific antibody, future payments will be contingent upon meeting certain similar
development, regulatory and commercialisation milestones and so do not meet the definition of
commitments pending further developments. This licence is subject to an up-front payment to Lilly
of $250,000 and milestone payments of up to $1 million through to Phase II clinical trials. Lilly is
also eligible to receive substantial additional milestone payments based on the achievement of
prespecified milestones, as well as tiered single-digit royalties on sales. In addition, the Company
will pay Lilly a percentage of any cash payments received in respect of any sublicence of the licensed
intellectual property.
Leases
In August 2021, Hemogenyx LLC entered into a lease for a 9,357 square foot purpose-built
laboratory for eight years beginning on January 15, 2022. The lease contains escalating monthly
payments ranging from approximately $64,300 to $76,500 per month over the lease term. The Group
paid a security deposit of £138,913 ($188,005) during the year ended 31 December 2021 for such
facility lease.
Service agreements
In December 2021, Hemogenyx Pharmaceuticals LLC entered into a service agreement to establish
Research Cell Banks (RCBs) for production of the Company’s proprietary recombinant protein(s)
encoded by cDNAs. Under the terms of the agreement, Hemogenyx Pharmaceuticals LLC must pay
(in Swiss Francs) CHF 590,000 in aggregate. After 31 December 2021 through 29 April 2022, which
is the date the financial statements were available to be issued, Hemogenyx Pharmaceuticals LLC
has paid £91,046 (CHF 112,500) under this agreement.
In December 2021, Hemogenyx Pharmaceuticals LLC entered into service agreements to produce
components of the Company’s CAR-T product candidate. Under the terms of the agreement,
Hemogenyx Pharmaceuticals LLC must pay an aggregate of £1,559,005 ($2,109,957) in milestone
payments during the term of production anticipated to be made by the end of 2022. After 31
December 2021 through to 29 April 2022, which is the date the financial statements were available
to be issued, Hemogenyx Pharmaceuticals LLC has paid £628,927 ($851,190) under these
agreements.
Capital equipment
The Company has taken delivery for evaluation purposes of equipment to the value of £428,425
($579,830). This equipment primarily comprises a bioreactor, an automated cell processing system,
and a cell manufacturing system. This would enable the Company to manufacture its cell therapy
products in-house with full control over processes and timing, using the clean rooms in its new
purpose-built laboratory. Based on service fee estimates provided to the Company, having this
capability could save the Company at least $2 million for the cells required for clinical trials of the
Hemogenyx Pharmaceuticals plc
Annual Report & Financial Statements for the
Year Ended 31 December 2021
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83
CAR-T product candidate alone, when compared with outsourcing this work to third parties. It could
additionally give the Company a source of revenue by providing cell manufacturing services to other
biotechnology companies.
27.
Ultimate controlling party
The Directors have determined that there is no controlling party as no individual shareholder holds a
controlling interest in the Company.
28.
Subsequent events
In January 2022, the Company and Selexis SA signed a service agreement to develop the cell line
for the Company’s CDX bispecific antibody for the treatment of acute myeloid leukemia (AML).
Under the agreement, the Company will leverage Selexis’ proprietary SUREtechnology Platform™,
a suite of cell line development tools and technologies that significantly reduces the time, effort, and
costs associated with developing high-performance mammalian cell lines.
In February 2022, the Company received notification from the Food and Drugs Administration
(“FDA”) that the proposed pre-Investigational New Drug (“pre-IND”) meeting relating to the
Company’s lead product candidate Chimeric Antigen Receptor (“CAR”) T-cells (“HEMO-CAR-T”)
is to be deferred until May 2022 as a result of a general FDA policy prioritising work on COVID-
19. The deferment of the meeting is not causing any delay in the development of the product
candidate.
In March 2022, the Company announced that it has achieved proof of concept (“POC”) for its
Chimeric Bait Receptor (“CBR”) platform technology and filed a seminal provisional patent
application protecting its rights to the intellectual property (“IP”) covering CBR.
On 30 March 2022, the Company dissolved Hemogenyx-Cell SPRL. This dissolution will not have
any effect on the financial statements.
29.
Copies of the annual report
Copies of the annual report will be available on the Company’s web site at https://hemogenyx.com
and from the Company’s registered office, 5 Fleet Place London EC4M 7RD.
