18th Sep 2007 07:02
AGI Therapeutics plc18 September 2007 AGI Therapeutics, plc reports Interim financial results for the six months ended 30 June, 2007 and Commencement of enrolment into Phase III study of arverapamil Dublin, Ireland, 18th September 2007 - AGI Therapeutics plc ("AGI" or the"Company"), a speciality pharmaceutical development company focused ongastrointestinal drug products, today reports interim financial results for thesix months ended 30 June, 2007. In addition, today the Company is pleased to report that enrolment has openedinto ARDIS-1, the first of three pivotal Phase III studies of arverapamil,(AGI-003), AGI's lead programme for the treatment of diarrhoea-predominantirritable bowel syndrome, (IBS-D), a major unmet medical need. Financial highlights: • Revenues of €196,000 compared with no revenues in the same period of the previous year • Cash and short term deposits at 30 June 2007 of €37.4 million (2006: €40.4 million) • R & D spend of €4.8 million (2006: €1.7 million) • Net loss of €5.2 million (2006: €2.3 million) • Loss per ordinary share of €0.08 cent (2006: €0.04 cent) Operating highlights: Highlights of the first half of the year include: • In June the Company filed an Investigational New Drug (IND) application with the US Food and Drug Administration (FDA) for our lead development candidate, arverapamil (AGI-003), for the treatment of IBS-D. • In 2006 and early 2007 we reported the Phase II proof-of-concept data for our arbaclofen (AGI-006), 4-ASA (AGI-022) and mecamylamine CR (AGI-004) product candidates. Since then we have focused on the development programmes for these products and we expect to initiate Phase II clinical studies in gastroparesis, ulcerative colitis and chemotherapy-induced diarrhoea respectively later this year or early in 2008. • We continued to progress our co-development programme with Axcan Pharma Inc. for CHRONAB-omeprazole for the treatment of nocturnal acid breakthrough (NAB) in patients with gastro-esophageal reflux disease (GERD), and expect to provide a further update by year end. • In anticipation of the increased level of development activity, particularly in our late-stage arverapamil programme, we further strengthened our management team with the addition of two experienced senior executives to our US group; Sian Bigora, Pharm D. as Vice President, Clinical Research & Regulatory Affairs and Amir Shojaei, Pharm D., Ph.D. as Vice President, Pharmaceutical Development. Since the period end: • We expanded our early-stage development pipeline by signing an exclusive option agreement with US-based Williamsburg Holdings LLC to license certain intellectual property and know-how for a novel prodrug platform for the prokinetic/antiemetic agent, levosulpiride. • Most recently the IND and associated clinical protocols for our ARDIS-1 and ARDIS-3 Phase III studies have been agreed with the FDA and we announce today that these two studies have now opened enrolment. Commenting on the interim results, Dr John Devane, Chief Executive of AGI, said: "The first six months of 2007 were dominated by the substantial work required tomeet our stated objective of advancing arverapamil, our lead programme, intoPhase III. This has now been achieved and we are looking forward to the prospectof developing this product for the treatment of IBS-D, a significant unmetmedical need" Outlook Commenting further on the outlook for the remainder of 2007, Dr. Devane added: "While keeping our primary focus on the progression of arverapamil in Phase III,we remain committed to moving forward our other programmes in GI-relateddisorders. We continue to progress CHRONAB-omeprazole under our co-developmentagreement with Axcan, and have now completed our plans for the further clinicaldevelopment of three mid-stage products, where we will initiate Phase II trialsacross a range of indications in the coming months. Furthermore, we successfullyexpanded our early-stage pipeline and will look to add further new projects onan ongoing basis. We are on track to make 2007 another landmark year for AGI." Contact Information: AGI Therapeutics, plc.Tel: +353 1 449 3254David Kelly, Chief Financial Officer Financial Dynamics - UKTel: +44 (0) 20 7831 3113Deborah Scott Financial Dynamics - IrelandTel: +353 1 663 3607Aisling Garvey For further information please see www.agitherapeutics.com Notes to Editors: About Arverapamil (AGI-003) Arverapamil (AGI-003) is an orally administered triple-action intestinalregulator, a first-in-class mechanism for the treatment of IBS-D. Arverapamil isa single enantiomer moiety of the racemic drug verapamil. Unlike the currentlyavailable commercial forms of racemic verapamil (a mixture of two enantiomers),arverapamil shows a dominant activity in treating the symptoms of IBS-D withoutthe traditional cardiovascular actions of the racemic drug. The efficacy andsafety of arverapamil in IBS patients has already been established in a Phase IItrial, the preliminary results of which were reported by the Company in 2006.The final results of this study will be presented by the Principal Investigator,Professor Eamonn Quigley on October 17th, 2007 at the American College ofGastroenterology's 72nd Annual Scientific Meeting to be held in Philadelphia,PA, USA. About ARDIS ARDIS represents AGI's Phase III programme for arverapamil (AGI-003) in thetreatment of IBS-D and consists of three pivotal studies. ARDIS-1 is a randomised, double-blind, placebo-controlled, parallel group PhaseIII study in IBS-D patients (both men and women). There are four treatment arms(placebo and three dose levels of arverapamil) and patients will be treated for12 weeks of double-blind therapy. At the end of double-blind therapy in ARDIS-1,patients will become eligible to enrol into ARDIS-3. It is planned to randomise1,200 patients into ARDIS-1. ARDIS-2 is a confirmatory Phase III efficacy/safety study to be conducted inIBS-D patients. ARDIS-3 is an open-label safety study designed to capture 1 year extended safetyin approximately 100 patients on continuous arverapamil therapy. About IBS-D Irritable bowel syndrome (IBS) is a functional disorder that comprises a clusterof gastrointestinal symptoms which are likely to be life long and which affectbetween 10% and 20% of the population in developed markets. IBS remains themost common diagnosis made by gastroenterologists and can lead to a substantialreduction in patients' quality of life, accompanied by considerablesocio-economic and psychological consequences. Altered intestinal motility is amajor component of IBS and patients are diagnosed and sub-typed according totheir predominant symptom of bowel disturbance. Diarrhoea-predominant irritablebowel syndrome (IBS-D) is estimated to occur in one-third of all IBS patients.IBS-D represents a significant unmet medical need as there are currently fewsafe and effective therapeutic options available to these patients. About AGI Therapeutics plc AGI is a speciality pharmaceutical company which is focused on the developmentand commercialisation of differentiated drug products for gastrointestinal (GI)diseases and disorders. AGI's common shares are listed on the AlternativeInvestment Market of the London Stock Exchange (AIM) and on the Irish EnterpriseExchange of the Irish Stock Market (IEX) as AGI. The Company has a portfolio of product candidates derived from its KnownMolecular Entity (KME) approach to drug re-profiling and development. KME is are-profiling methodology used by the Company to identify existing therapeuticdrugs which typically have been marketed for a number of years, have establishedsafety profiles and can be developed for new clinical indications or withimproved profiles in their existing clinical indications. In this way, theCompany seeks to reduce the risk, time and cost of new product development ascompared to the development of new chemical entities. AGI is developing a range of product candidates to treat a variety of prevalentGI diseases and disorders, including irritable bowel syndrome (IBS), dyspepsia,gastroparesis, ulcerative colitis, gastro-esophageal reflux disease (GERD) anddiarrhoea-related conditions such as chemotherapy-induced diarrhoea (CID). TheCompany is targeting areas of the GI therapeutic drug products market for itsproduct candidates where there are currently unmet medical needs or where theeffectiveness of existing drug therapies can be further improved. The Company has five active clinical stage product candidates which are eitherisomers or new drug delivery formulations of existing approved drugs, and whichhave established safety and tolerability profiles in their currently approvedclinical indications. For further information please see www.agitherapeutics.com Statements contained within this press release may contain forward-lookingcomments which involve risks and uncertainties that may cause actual results tovary from those contained in the forward-looking statements. In some cases, youcan identify such forward-looking statements by terminology such as 'may', 'will', 'could', 'forecasts', 'expects', 'plans', 'anticipates', 'believes', 'estimates', 'predicts', 'potential', or 'continue'. Predictions andforward-looking references in this press release are subject to the satisfactoryprogress of research which is, by nature, unpredictable. Forward projectionsreflect management's best estimates based on information available at the timeof issue. Chairman's and chief executive's review The first six months of 2007 have been a busy and productive period for AGI. InFebruary we delivered a product update and outlook for 2007 to our shareholdersoutlining our plans for this year. We are pleased to report that, at thehalf-way stage of 2007, we are well on track to meet our various key developmentobjectives. In particular, following a pre-IND meeting with the FDA we proceeded to compileand file a comprehensive IND in June for arverapamil (AGI-003), our productcandidate for treating diarrhoea-predominant irritable bowel syndrome (IBS-D).This IND included details of our planned pivotal Phase III clinical trials. We also completed our review and analysis of all the data from theproof-of-concept clinical trials undertaken for arbaclofen (AGI-006), 4-ASA(AGI-022) and mecamylamine CR (AGI-004) which were previously reported inpreliminary form in 2006 and early 2007, and we are pleased to now report that; o Phase II results for arbaclofen (AGI-006) are supportive of further clinical development for treatment of gastroparesis. o The profile of anti-diarrhoeal activity observed with mecamylamine CR (AGI-004) is encouraging and further investigation is being carried out on the role of this product in treating chemotherapy-induced diarrhoea (CID), a serious and often limiting side-effect of many current anti-cancer drug therapies. o After demonstrating an excellent pharmacokinetic profile consistent with once-daily dosing and colonic targeting, we are now planning to advance 4-ASA (AGI-022) into Phase II clinical development for the treatment of ulcerative colitis (UC). More recently we started to expand our portfolio to include some early-stageproducts which we hope will add further value to the clinical pipeline in futureyears. We entered into an exclusive option with Williamsburg Holdings LLC for anovel prodrug platform for the prokinetic/antiemetic agent, levosulpiride, aproject we have now nominated as AGI-025. We intend to continue our focus onidentifying additional known molecular entities, or KME's, with promisingpotential applications in gastrointestinal-related conditions. Review of key clinical research programmes Arverapamil (AGI-003) in IBS Irritable bowel syndrome (IBS) is a functional disorder that comprises a clusterof gastrointestinal symptoms which are likely to be life long and which affectbetween 10% and 20% of the population in developed markets. IBS remains themost common diagnosis made by gastroenterologists and can lead to a substantialreduction in patients' quality of life, accompanied by considerablesocio-economic and psychological consequences. Altered intestinal motility is amajor component of IBS and patients are diagnosed and sub-typed according totheir predominant symptom of bowel disturbance. Diarrhoea-predominant irritablebowel syndrome (IBS-D) is estimated to occur in one-third of all IBS patientsand there are currently an estimated 6 million diagnosed IBS-D patients indeveloped markets. IBS-D represents a significant unmet medical need as thereare currently few safe and effective therapeutic options available to thesepatients. Arverapamil is being developed in an oral dosage form for thetreatment of IBS-D in both men and women. In June 2006 we announced the positive outcome of a Phase II clinical trialevaluating arverapamil in 129 patients (male and female) meeting ROME IIcriteria (modified) for non-constipation predominant IBS. The results of thisPhase II study demonstrated the efficacy of arverapamil in IBS patients withnon-constipation predominant symptoms and AGI expects that this drug will be ofbenefit to those IBS-D patients who are currently without a safe and effectivetherapy for this condition. Earlier in 2007 we held our first meeting with the Food and Drug Administration(FDA) in the US to discuss the data of the Phase II study and the design of thepivotal Phase III study programme. Following this meeting, we filed anInvestigational Drug Application (IND) with the FDA in June. The IND containeddetails of the planned Phase III programme design, encompassing three pivotalPhase III studies in total. The IND also included the full protocols for two ofthese studies; ARDIS-1 (a pivotal Phase III efficacy/safety study) and ARDIS-3(an open-label safety study) to evaluate arverapamil in IBS-D, both of which wehave now initiated. We have called the Phase III pivotal programme ARDIS. The ARDIS programme asdiscussed with FDA involves three pivotal Phase III studies. ARDIS-1 is a randomised, double-blind, placebo-controlled, parallel group PhaseIII study in IBS-D patients (both men and women). There are four treatment arms(placebo and three dose levels of arverapamil) and patients will be treated for12 weeks of double-blind therapy. At the end of double-blind therapy in ARDIS-1,patients will become eligible to enrol into ARDIS-3. It is planned to randomise1,200 patients into ARDIS-1. ARDIS-2 is a confirmatory Phase III efficacy/safety study to be conducted inIBS-D patients. ARDIS-3 is an open-label safety study designed to capture 1 year extended safetyin approximately 100 patients on continuous arverapamil therapy. CHRONAB-omeprazole (AGI-010) for nocturnal acid breakthrough (NAB) in GERD We are developing a modified release formulation of the proton pump inhibitordrug (PPI), omeprazole based on our CHRONAB technology which we believe will beeffective in treating NAB, a prevalent aspect of current PPI therapy of GERD.GERD is the most prevalent of the major gastrointestinal disorders and is mostcommonly treated with PPI drugs which achieve global annual sales in excess of€15 billion. NAB is estimated to occur in at least 50 per cent of GERD patientson PPI therapy. AGI entered into a co-development and license agreement for North Americanmarkets with Axcan Pharma Inc. in September 2006 to jointly develop a modifiedrelease omeprazole product based on AGI's CHRONAB formulation approach. AGI isworking closely with Axcan to progress omeprazole through the current Phase IIproduct optimisation. This phase of the project is continuing and it is hopedthat an optimised formulation will be identified later this calendar year. Oncethis optimisation is successfully completed, AGI and Axcan plan to submit arequest for a meeting with the FDA to define and agree the final phase ofdevelopment for this product. Mecamylamine CR (AGI-004) in chemotherapy-induced diarrhoea (CID) Preliminary results for controlled release mecamylamine CR in FunctionalDiarrhoea were reported in February 2007. The data from this study demonstrated a strong and statistically significantsignal in improved stool consistency in patients with functional diarrhoea (perprotocol) but without a matching response in the primary endpoint of patientglobal impression. AGI believes that this controlled release mecamylamineproduct has the potential to be an effective agent in diarrhoeal statescharacterised by a high frequency of watery stools. Given the mechanism ofaction of mecamylamine CR on nicotinic acetylcholine receptors (nAChR) and thepathophysiology of certain diarrhoeal states which are not satisfied by currenttherapy, AGI has identified CID as an area of unmet clinical need wheremecamylamine CR may have therapeutic benefit and is finalising plans forprogression to Phase II clinical development in this indication. A Phase II protocol will be submitted shortly for regulatory and ethicsapproval. A leading principal investigator has been selected and AGI isconfident that first patients will be enrolled in H2, 2007. Arbaclofen (AGI-006) in gastroparesis Preliminary results of a 64 patient exploratory Phase II trial of arbaclofen infunctional dyspepsia were reported in February 2007. The results demonstrated a robust profile of beneficial effects on a range ofdyspeptic symptoms but without a matching response in the primary endpoint ofpatient global impression. Nonetheless, arbaclofen did demonstratestatistically significant improvements across a range of secondary endpoints inthis trial, including patient global severity, bloating, nausea,condition-specific Quality-of-Life (QOL) and rescue antacids use. Therefore, AGIhas determined that the profile of activity of arbaclofen in various dyspepticsymptoms matches well with the desired profile of a therapy for the dyspepticsymptoms of gastroparesis. Diabetic gastroparesis is the most commonmanifestation of the dyspeptic symptoms of gastroparesis, however, effective andwell-tolerated therapy options are extremely limited for these patients. AGI is now well advanced in its plans for the further Phase II clinicaldevelopment of arbaclofen in gastroparesis. Regulatory and ethics submissionsare planned for late H2, 2007 with patient enrolment in 2008. 4-ASA (AGI-022) in ulcerative colitis We are developing a modified release oral formulation of 4-aminosalicylatesodium (4-ASA) for the induction and maintenance of remission of mild tomoderate ulcerative colitis (UC). UC is a chronic, recurrent, relapsing andremitting inflammatory disease of the colon and/or rectum. We believe that our4-ASA product may offer certain advantages compared with current 5-ASA basedtherapies which are commonly used to treat UC, including a superior tolerabilityprofile, and more reliable delivery to the target sites of action in UC leadingto a higher efficiency of therapy with potential dosing advantages. In March 2006, we reported on the outcome of a human pharmacokinetics trial in16 human subjects designed to characterise the in-vivo drug release profile andpharmacokinetics of three delayed release/controlled release formulationscompared with a reference solution of 4-ASA. The study demonstrated delayed andcontrolled in-vivo release profiles consistent with targeted colonic delivery. Alead formulation has been selected as optimal and will be the basis for futureclinical development. Based on the positive Phase I results, we have decided to progress this productinto Phase II clinical evaluation for the treatment of ulcerative colitis (UC).The goal of the planned Phase II study will be to confirm the efficacy/dosageadvantages of the product in UC patients. Formulation development work andscale-up of manufacture is now underway. A detailed Phase II protocol has been developed and a leading principalinvestigator selected. Regulatory and ethics submissions are planned in H2, 2007to enable patient enrolment in 2008. Levosulpiride prodrugs (AGI-025) For some time we have been interested in the anti-emetic and prokineticproperties of levosulpiride and its possible application in certain GI-relatedindications, such as nausea and vomiting induced by chemotherapy (CINV), aspectsof functional dyspepsia, gastric stasis including diabetic and post-operativegastroparesis, and gastroesophageal reflux disease (GERD). We were impressed bythe intellectual property developed by Williamsburg Holdings LLC, a US-basedcompany, and recently announced that AGI and Williamsburg had entered into anexclusive option agreement with pre-defined licensing terms. While still anearly stage opportunity, we believe this could become an important programme forAGI in the future and demonstrates our commitment to broaden our early stageportfolio. AGI continues to seek to identify KME-based product opportunities with novel andimportant therapeutic advantages in gastrointestinal conditions and add these toour R&D pipeline. Financial review Basis of preparation and International Financial Reporting Standards (IFRS). The interim results have been prepared in accordance with IFRS as adopted by theEU. Operating performance In the six months to June 30, 2007, AGI was actively engaged in advancing the R&D projects referred to in the chairman's and chief executive's statement above. The Company recorded revenues of €196,000 in the six months to June 30, 2007. Norevenues arose in the comparable period in 2006. The 2007 revenues arise from alicense agreement signed in September 2006 with Axcan Pharma, Inc, a Canadianheadquartered specialty pharmaceutical company with a focus on GI diseases. Aninitial payment of $1.5 million is being recognised on a straight line basisover three years, an estimate of the likely term of the underlying developmentprogramme. Research and development expenditure during the period was €4.8 million comparedto €1.7 million in 2006. This increase is due to the additional expendituresbeing incurred on the Company's development programmes. The costs include thepreparation work for the Phase III study on arverapamil, ARDIS, for which thefirst patients are expected to be enrolled and dosed in the second half of theyear. Included in research and development costs are the costs of internal salariesand costs of maintaining and broadening the Company's intellectual propertyportfolio. Administrative expenses during the period were €1.2 million, an increase overthe €0.9 million incurred in the same period in 2006. This increase reflects theexpansion of the Company's operations including the addition of an office in theUS, as well as the costs of share based compensation. In accordance with IFRS 2 the Company has accounted for the expense of sharebased compensation arising from the issuance of options over the Company'sequity to key employees. The expense in the period was €0.5 million, (2006 €0.2million). This is a non-cash expense. Net cash outflow from operating activities for the period was €2.6 million,comparable to the net outflow of €2.3 million in 2006. At the end of June 2007the Company had cash, cash equivalents and investments in the form of termdeposits, of €37.4 million. UNAUDITED CONSOLIDATED INTERIM INCOME STATEMENTS For the Six Months Ended 30 June Notes Period ended Period ended June 2007 June 2006 •'000 •'000 _____ _____Revenue 196 -Research and development expenses 4,793 1,690 (share based payment charge of €209,000, 30 June 2006 €81,000)Administrative expenses 1,202 813 (share based payment charge of €266,000, 30 June 2006 €159,000) _____ _____Total operating expenses 5,995 2,503 _____ _____Operating loss (5,799) (2,503) Interest income 727 318Interest expense - (98) _____ _____Loss before tax (5,072) (2,283)Income tax (109) - _____ _____Loss for the period (5,181) (2,283) _____ _____Basic loss per ordinary share:Basic and diluted loss per share 2 (0.08) (0.04) _____ _____ UNAUDITED CONSOLIDATED INTERIM BALANCE SHEETS 30 June 30 June 2007 2006 •'000 •'000 _____ _____Non-Current AssetsIntangible assets 1,780 1,504Property, plant and equipment 34 43 _____ _____Total Non-Current Assets 1,814 1,547 _____ _____Current AssetsOther current assets 414 287Other investments - 15,000Cash and cash equivalents 37,390 25,072 _____ _____Total Current Assets 37,804 40,359 _____ _____Total Assets 39,618 41,906 _____ _____Non-Current LiabilitiesConvertible preference shares - - _____ _____Total Non-Current Liabilities - - _____ _____Current LiabilitiesAccounts payable 507 160Accrued and other liabilities 3,913 334 _____ _____Total Current Liabilities 4,420 494 _____ _____Total Liabilities 4,420 494Shareholders' EquityShare capital 674 674Share premium 51,079 51,079Other reserves 1,270 264Retained loss (17,825) (10,605) _____ _____Total Shareholders' Equity 35,198 41,412 _____ _____Total Shareholders' Equity and Liabilities 39,618 41,906 _____ _____ UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS 30 June 2007 30 June 2006 •'000 •'000 _____ _____Loss for the period (5,181) (2,283)Adjustments to reconcile loss to net cash used in operating activities:Depreciation of property, plant and equipment 8 1Amortisation of intangibles 30 17Interest income (727) (318)Interest expense - 98Income tax 109 -Share-based compensation 475 240 _____ _____Operating cash outflow before changes in working capital (5,286) (2,245)Increase in other current assets (161) (89)Increase/(decrease) in accounts payable 49 (564)Increase in accrued and other liabilities 2,087 323 _____ _____Cash used by operations (3,311) (2,575)Interest received 697 324Interest paid - - _____ _____Net cash outflow from operating activities (2,614) (2,251) _____ _____Investing activitiesAcquisition of other investments - (15,000)Acquisition of property, plant and equipment (3) (42) _____ _____Net cash used by investing activities (3) (15,042) _____ _____Financing activitiesProceeds from issue of share capital - 39,450 _____ _____Net cash provided by financing activities - 39,450 _____ _____Net (decrease)/increase in cash and cash equivalents (2,617) 22,157 _____ _____Cash and cash equivalents at the beginning of period 40,007 2,915Cash and cash equivalents at the end of the period 37,390 25,072 _____ _____ UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS'EQUITY Number Ordinary Preference Share Share Premium of Shares share Capital •'000 Capital •'000 •'000 _____ _____ _____ _____ Balance at 1January 2006 - 1 - 4,167Issue of share capital 1,663,599 17 - -Restructuring of share capital and reverseacquisition:Amalgamation of subsidiary share capital - (1) - 1Fair value of new shares issued to acquire 32,019,025 137 183 (320)subsidiaryConversion of preference shares - 183 (183) -Redemption of convertible debt - - - 8,047Issue of ordinary shares on listing on AIM 33,730,159 337 - 42,163Costs of share issue - - - (2,979)Loss for the period - - - -Share-based compensation - - - - _____ _____ _____ _____Balance at 30 June 2006 67,412,783 674 - 51,079Loss for the period - - - -Share-based compensation - - - - _____ _____ _____ _____Balance at 31 December 2006 67,412,783 674 - 51,079Loss for the period - - - -Share-based compensation - - - - _____ _____ _____ _____Balance at 30 June 2007 67,412,783 674 - 51,079 _____ _____ _____ _____ UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS'EQUITY (continued from table above) Other Reserves Retained Loss Total Amount •'000 •'000 •'000 _____ _____ _____Balance at 1January 2006 24 (8,322) (4,130)Issue of share capital - - 17Restructuring of share capital and reverse acquisition:Amalgamation of subsidiary share capital - - -Fair value of new shares issued to acquire subsidiary - - -Conversion of preference shares - - -Redemption of convertible debt - - 8,047Issue of ordinary shares on listing on AIM - - 42,500Costs of share issue - - (2,979)Loss for the period - (2,283) (2,283)Share-based compensation 240 - 240 _____ _____ _____Balance at 30 June 2006 264 (10,605) 41,412Loss for the period (2,039) (2,039) -Share-based compensation 531 - 531 _____ _____ _____Balance at 31 December 2006 795 (12,644) 39,904Loss for the period - (5,181) (5,181)Share-based compensation 475 - 475 _____ _____ _____Balance at 30 June 2007 1,270 (17,825) 35,198 _____ _____ _____ NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS 1 BASIS OF PREPARATION These unaudited condensed consolidated interim financial statements (the interimfinancial statements) have been prepared in accordance with IFRS that areadopted by the European Union (EU) and effective at 30 June 2007. The interimfinancial statements do not include all of the information required for fullannual financial statements. These interim financial statements are presented in euro rounded to the nearestthousand, being the functional currency of the parent company and the groupcompanies. They are prepared on the historical cost basis, except for financialinstruments and share based payments, which are stated at fair value. The accounting policies applied by AGI in these interim financial statements arethe same as those applied by AGI in its consolidated financial statements as atand for the year ended 31 December 2006. The preparation of interim financial statements requires management to makejudgements, estimates and assumptions that affect the application of policiesand reported amounts of assets and liabilities, income and expenses. Actualresults could differ materially from these estimates. In preparing these interimfinancial statements, the significant judgements made by management in applyingour accounting policies and the key sources of estimation uncertainty were thesame as those that applied to the consolidated financial statements as at andfor the year ended 31 December 2006. These interim financial statements do not constitute Statutory FinancialStatements of the Group within the meaning of Regulation 40 of the EuropeanCommunities (Companies: Group Accounts) Regulations, 1992. Statutory FinancialStatements for the year ended 31 December 2006 have been filed with theCompanies Office. The auditor's report on those financial statements wasunqualified. 2 LOSS PER SHARE Basic loss per share is computed by dividing the loss for the period availableto ordinary shareholders by the weighted average number of ordinary sharesoutstanding during the period. Diluted loss per share is computed by dividingthe loss for the period, by the weighted average number of ordinary sharesoutstanding and, when dilutive, adjusted for the effect of all potentiallydilutive shares, including stock options, warrants, and convertible debtsecurities on an as-if-converted basis. The following table sets forth the computation for basic and diluted loss pershare for the six months ended 30 June 2007 and 2005: 30 June 2007 30 June 2006 _____ _____Numerator:Loss attributable to ordinary shareholders (5,181,000) (2,283,000) Denominator:Denominator for basic-weighted average shares 67,412,783 56,420,412 Basic and diluted loss per share:Basic loss and diluted per share (0.08) (0.04) Potentially dilutive instruments, such as share options have not been treated asdilutive as the group made a loss in both periods. 3 RELATED PARTY TRANSACTIONS (a) Transactions with founding members and shareholders In the six months ended 30 June 2007, the Company paid €20,000 (30 June 2006:€20,000) in consulting fees to Kellpharm, a company of which John Kelly, ashareholder of the Company, is also a shareholder. The Company also paid Icon Clinical Research fees of €75,133 (30 June 2006:€309,884) for clinical research studies and consulting, Ronan Lambe, chairman ofAGI's board of directors, is also a director of Icon. Frank Kenny, John O'Sullivan and Peter Sandys are directors of the Company andare board nominees of Delta Partners, ACT Venture Capital and Seroba Bioventuresrespectively. Fees of €17,000 annually are paid by the Company to each ofDelta, ACT and Seroba in respect of their nominees' appointment. (b) Transactions with other related parties BioClin Research Laboratories Limited provides Bioanalytical Sample Analysis tothe Company at contracted rates. In the six months ended 30 June 2007 €124,389(30 June 2006: €53,165) was paid to BioClin for these services. Mary Martin, adirector of the Company is also a director of BioClin. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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