Investment in portfolio company

23 July 2012

Imperial Innovations Group plc

Innovations invests in £17 million funding round for portfolio company, Cell Medica

Imperial Innovations Group plc (AIM: IVO, 'Innovations'), a leading technology commercialisation and investment group, has invested in a £17 million funding round in portfolio company Cell Medica, a clinical stage cell therapeutics business, enabling it to continue development of its immune reconstitution cell therapies in Europe and to launch new operations in Texas, US, focussing on cancer immunotherapy. Invesco Perpetual and the Cancer Prevention and Research Institute of Texas (CPRIT) also participated in the round.

Cell Medica's technology is based on the selection, activation and expansion of immune cells, specifically T-cells, which can prevent and treat a range of diseases. Its CytovirTM product family treats life-threatening viral infections in leukaemia and lymphoma patients who have undergone bone marrow transplants. These patients have severely compromised immune systems, putting them at significant risk of infection from common viruses.

Cell Medica's CytovirTM therapies involve the reconstitution of natural cell-mediated immunity, which represents a unique benefit which cannot be matched by existing antiviral drugs. The European market launch of CytovirTM CMV for cytomegalovirus infections is targeted for 2013 following completion of two randomised controlled studies on-going in the UK.

The investment from CPRIT will fund the clinical development in the US of Cell Medica's novel CytorexTM EBV therapy which treats cancers associated with the Epstein Barr Virus.

Innovations and Invesco Perpetual committed £3 million and £4 million respectively, subject to milestones. CPRIT, a body founded in 2007 to fund cancer research and prevention programmes and services in Texas, committed the balance of £9.7 million. Following the first investment tranche, Innovations will hold a 28% stake in the business. The Wellcome Trust will also become a shareholder in the business through elected conversion of a loan security into equity.

Cell Medica has also appointed Thomas Hecht as Chairman. A former transplant physician, Thomas was vice president of marketing at Amgen Europe until 2002, and since then has been Chairman of a number of boards including Delenex and Cytos Biotechnology AG. Maina Bhaman, Innovations Director of Healthcare Investments sits on the board of the Company.

Susan Searle, CEO of Imperial Innovations, said:

"Cell Medica's innovative cell therapies have the potential to significantly improve outcomes for a group of patients who are currently clinically under served.

"We are pleased that one of our early stage investments is now able to develop and scale into a multinational business. This follow-on funding will allow Cell Medica to grow and exploit opportunities in both the US and European markets."

Gregg Sando, CEO of Cell Medica, said:

"We have brought together a very special group of investors who are supporting an expert team and well considered plan to realise the significant potential of patient-specific cell therapeutics. We will be expanding our management team both in the US and Europe to deliver on current programmes and secure a leadership position in cell therapeutics for cancer and infectious diseases."

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Notes to editors

Imperial Innovations - www.imperialinnovations.co.uk 

Innovations creates, builds and invests in pioneering university technologies addressing global problems in healthcare, energy, engineering and the environment. It combines deep understanding of science and technology with commercial acumen and strong investment expertise.

Innovations supports scientist-entrepreneurs in the commercialisation of their ideas by:

·; leading the formation of new companies and providing facilities in the early stages

·; providing significant investment and encouraging co-investment to accelerate the transition from R&D to products

·; providing operational expertise

·; helping to recruit high-calibre industry figures and experienced entrepreneurs as executive management and Board members

Innovations invests in companies based on technologies from or associated with four universities: Imperial College London; and Cambridge University, Oxford University, and UCL supported by its collaborations with Cambridge Enterprise, OSEM and UCL Business. These are the UK's leading research intensive universities, measured by research income.

By raising £140 million in January 2011, Innovations has been able to accelerate the making of, and increase the size of its investments. In the year to 31 July 2011, Innovations invested £35.1 million (2010: £14 million) in 23 ventures, and launched six new companies.

In its current portfolio of 78 companies, Innovations' top six companies by carrying value include Nexeon, Circassia, PsiOxus, Veryan Medical, CellMedica and Plaxica.

Cell Medica - www.cellmedica.co.uk

Cell Medica is a cell therapeutics company engaged in the development, manufacture, marketing and distribution of cell-based products for immune reconstitution and cancer treatment. The Company's CytovirTM product family for immune reconstitution targets the prevention and treatment of infections caused by latent viruses in immunosuppressed patients following allogeneic haematopoietic stem cell (bone marrow) transplant. In the field of cancer immunotherapy, Cell Medica is targeting a range of cancers associated with the oncogenic Epstein Barr Virus (EBV).

Cell Medica is currently sponsoring two ground-breaking randomised controlled clinical studies to investigate the use of Cytovir CMV to prevent and treat cytomegalovirus (CMV) infection following bone marrow transplantation. Cytovir ADV is for the treatment of adenovirus (ADV) infections in paediatric patients following bone marrow transplantation. The Cytovir ADV development programme will be initiated in 2012 with the launch of a Phase I/II Trial conducted at the Great Ormond Street Hospital for Children in London.