17/09/2021 - Midatech Pharma plc: Interim Report 2021

MIDATECH PHARMA PLC

INTERIM RESULTS

Six months ended 30 June 2021

Company number 09216368

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17 September 2021

Midatech Pharma Plc

("Midatech" or the "Company")

Interim results for the six months ended 30 June 2021

Midatech Pharma PLC (AIM: MTPH.L; NASDAQ: MTP), a drug delivery technology company focused on improving the bio-delivery and biodistribution of medicines, announces its unaudited interim results for the six months ended 30 June 2021.

OPERATIONAL HIGHLIGHTS

On 17 June 2021, the Company announced significant progress across a number of R&D programmes including:

Q-Sphera

• Breakthrough data on the successful encapsulation of an exemplar monoclonal antibody (mAb);
• The delivery of proof of concept formulations of MTX214 and MTX216 to the Company's collaboration partner for the partner's in vivo studies; and
• The successful development of MTD211, a long-acting formulation of brexpiprazole which, in in vivo studies, demonstrated therapeutic blood levels over a period of three months.

MTX110

• Demonstration, in vitro, of the potency of MTX110 in four patient-derived Glioblastoma cell lines.

FINANCIAL HIGHLIGHTS (including post period end)

• Total revenue in H1 2021 was £0.40m (1H20: £0.17m). Total revenue represents income from R&D collaborations plus grant revenue.
• Research and development costs decreased by 50% to £2.01m (1H20: £3.99m) as a result of the termination of MTD201 and focus on multiple earlier stage programmes.
• Administrative expenses decreased 44% to £1.64m (1H20: £2.93m) due to expenses incurred in connection with the Strategic Review and restructuring in the prior period.
• Net cash used in operating activities (after changes in working capital) in 1H21 was £3.11m, compared with £7.09m in 1H20.
• In July, post period end, the Company raised £10.0m before expenses in an UK Placing of 35.1m ordinary shares at £0.285 per share.
• The cash balance on 30 June 2021 was £4.20m.

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Commenting, Stephen Stamp, CEO and CFO of Midatech said: "We are pleased to report good progress throughout the Company and an expanded and exciting pipeline of programmes and opportunities. The disruption and costs of the restructuring in 2020 are now behind us. The first half of 2021 has been highly productive with three potentially viable Q-Spheraformulations, one internal and two for a collaboration partner. We believe the breakthrough data on the encapsulation of a protein could prove to be a very significant opportunity for Midatech."

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About Midatech Pharma PLC

Midatech Pharma PLC (dual listed on LSE AIM: MTPH; and NASDAQ: MTP) is a drug delivery technology company focused on improving the bio-delivery and biodistribution of medicines. The Company combines approved and development medications with its proprietary and innovative drug delivery technologies to provide compelling products that have the potential to powerfully impact the lives of patients.

The Company has developed three in-house technology platforms, each with its own unique mechanism to improve delivery of medications to sites of disease. All of the Company's technologies have successfully entered human use in the clinic, providing important validation of the potential for each platform:

• Q-Sphera™platform: a disruptive micro-technology used for sustained release to prolong and control the release of therapeutics over an extended period of time (from weeks to months).
• MidaSolve™ platform: an innovative nanotechnology used to dissolve insoluble drugs so that they can be administered in liquid form directly and locally into tumours.
• MidaCore™ platform: a leading-edge nanotechnology used for targeting medications to sites of disease.

The platform nature of the technologies offers the potential to develop multiple drug assets rather than being reliant on a limited number of programmes. Midatech's technologies are supported by 36 patent families including 120 granted patents and an additional 70 patent applications. Midatech's headquarters and R&D facility is in Cardiff, UK. For more information please visit www.midatechpharma.com

Forward-Looking Statements

Certain statements in this press release may constitute "forward-looking statements" within the meaning of legislation in the United Kingdom and/or United States Private Securities Litigation Reform Act. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements.

Reference should be made to those documents that Midatech shall file from time to time or announcements that may be made by Midatech in accordance with the London Stock Exchange AIM Rules for Companies ("AIM Rules"), the Disclosure and Transparency Rules ("DTRs") and the rules and regulations promulgated by the US Securities and Exchange Commission, which contains and identifies other important factors that could cause actual results to differ materially from those contained in any projections or forward-looking statements. These forward-looking statements speak only as of the date of this announcement. All subsequent written and oral forward-looking statements by or concerning Midatech are expressly qualified in their entirety by the cautionary statements above. Except as may be required under the AIM Rules or the DTRs or by relevant law in the United Kingdom or the United States, Midatech does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future events or otherwise arising.

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CHIEF EXECUTIVE'S REVIEW

In the 14 months following the announcement of our Strategic Review, we have rationalised operations including the shutdown of our Bilbao operations, thereby halving our monthly cash burn rate and pivoted from a largely singular focus on one Phase III ready asset (MTD201, Q-Sphera octreotide) to a "multiple shots on goal" strategy with an expanded pipeline of 10 earlier stage programmes as follows:

The first half of 2021 was highly productive in terms of advancing our R&D pipeline, culminating in the announcement of breakthrough data on the successful encapsulation of a biologic using Q-Sphera technology and significant progress across multiple other R&D programmes on 17 June 2021.

Q-Sphera pipeline

The Company's Q-Sphera technology employs proprietary 3-D printing techniques to encapsulate drugs in polymer-based bioresorbable microspheres which may be injected to form depots in the body which release drug over predictable, sustained periods from one week to several months. Progress of the Q-Sphera pipeline in 1H21 includes:

Proteins (incl mAb) formulation

There are no approved long-acting injectable formulations of biologic products such as mAbs or other high molecular weight proteins primarily because they are delicate and easily de-

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natured in manufacture. We have been working on several proteins including two exemplar mAbs and thus far, have demonstrated encapsulation of the mAb and most importantly, preservation of its functional integrity and antigen binding in vitro. We believe no other commercial or academic organisation has been able to successfully deliver therapeutic proteins over extended periods using methods capable of commercial scaling.

We believe these results could open up very significant opportunities for our Q-Sphera technology. A significant number of latest generation medicines are protein based and reformulation as long-acting injectables could provide significant benefits to patients, physicians and at reduced cost to payors. In 2020, the top 10 mAbs recorded aggregate sales of US$74.9 billion1 and all mAbs US$154 billion1 globally.

The next steps will be to further optimise the drug loading and dissolution profile for encapsulated mAbs. In parallel, we are seeking to replicate the data seen with the first exemplar mAb and we are evaluating multiple high value mAb therapeutics to add to our internal pipeline.

MTX214 and MTX216

Both MTX214 and MTX216 are being developed under collaboration agreements with the European affiliate of a global healthcare company. We manufactured and delivered proof of concept formulations of both MTX214 and MTX216 to the collaboration partner who, in turn, is undertaking in vivo studies with both formulations.

MTD211

As part of our internal pipeline, we have successfully developed a long-acting formulation of brexpiprazole. In in vivo studies, MTD211 was well tolerated and demonstrated that a single injection of MTD211 is expected to deliver therapeutic blood levels of brexpiprazole over a period of three months.

Marketed under the brand name Rexulti®, brexpiprazole is indicated for the treatment of schizophrenia and adjunctive treatment of major depressive disorder (MDD) and is currently only available as an immediate release oral tablet. The market for anti-psychotic drugs is shifting towards long-acting formulations for reasons of improved patient compliance and lowering of payor costs associated with patient hospitalisation events as evidenced by the recent approval of Invega Hafyera™ for schizophrenia. Sales of long-actinganti-psychotic products in 2020 were approximately US$5.7 billion2 globally.

We have initiated discussions with third parties about a potential licencing of MTD211. There can be no assurance on the timing for concluding these discussions nor any assurance that the parties will enter into definitive agreements.

MTX110

MTX110, a novel formulation of panobinostat administered through convection enhanced delivery, is in clinical development for intractable brain cancers including Diffuse Intrinsic Pontine Glioma (DIPG) and Glioblastoma Multiforme (GBM).

Following a constructive pre-IND meeting with the FDA in June 2021, we are planning to initiate a Phase II study in DIPG as soon as possible after the recruitment and treatment of the remaining four patients in the ongoing Phase I study at Columbia University. The Phase II study is expected to be open label with two doses in newly diagnosed patients. Administration of MTX110 will be via convection enhanced delivery (CED) over 48 hours in six cycles, two to four weeks apart. Primary endpoints will be safety, tolerability and overall survival at 12 months (OS12). Approximately 1,000 patients3 globally are diagnosed with DIPG per annum and median survival is approximately 10 months4.

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