Cambridge, UK 27 July 2015: Horizon Discovery Group plc (LSE: HZD) ("Horizon" or "the Company”), the international life science company supplying research tools and services that power genomics research and the development of personalised medicines, today announces that, further to the trading update announced on 20th July 2015 and as anticipated in the recently announced £25 million share placement, it will invest up to £10 million in its leveraged R&D business over a period of two years to identify the next generation of molecular cancer therapeutics.
This investment into the Group’s leveraged R&D business is in line with its strategy of driving scientific leadership and leveraging its technology platform as stated at IPO.
The leveraged R&D business is underpinned by the Group’s gene editing, genetically-defined disease models, genetic and combination drug screening technology platforms, and its extensive knowhow in cancer research and drug discovery. The business is designed to deliver a portfolio of upside potential to investors over and above the products and services businesses that recently reported 118% growth in revenues to circa £8.6 million in H1, 2015 versus the same period in 2014. Shareholders currently stand to benefit from Horizon’s historical investment of £4 million in this business, which has been recouped with a forward potential to recognise up to £158 million in pre-clinical and clinical drug development milestones from a range of programs, plus product royalties on its HD-001 program, now partnered with AstraZeneca.
This targeted investment will be used to define novel drug targets and early stage New Chemical Entities (NCEs)/New Biological Entities (NBEs) that could lead to the discovery of novel cancer drug candidates across many different oncology indications. The Group will be seeking early partnerships for these programmes with therapeutic-focused companies. This strategy is expected to enable the Group to broaden the pipeline of potential revenue earning milestone agreements as programmes progress, as well as future royalties upon product sales.
The investment will be directed into two areas of research focus: synthetic lethality and immuno- oncology. Synthetic lethality exploits vulnerabilities arising from rewiring of cell signaling pathways by cancer-driving mutations, a strategy recently validated by the approval of AstraZeneca’s drug Lynparza for the treatment of ovarian cancer (synthetic lethality also underpins the Group’s HD-001 programme). Immuno-oncology can overcome the mechanisms by which cancer cells hide from the immune system, and give long-lasting cancer remission. Immuno-oncology successes include the marketed products Yervoy, Opdivo and Keytruda.
Dr. Darrin M. Disley, Chief Executive Officer of Horizon Discovery Group plc, commented: “In line with our strategy to reach profitability in 2017 driven by revenues derived from our products services and leveraged R&D businesses, we are investing to expand our milestone portfolio in two very promising areas of cancer research, which are predicted to represent 20-50% of the oncology market in ten years’ time. By seeking early partnerships we will keep the portfolio broad whilst minimizing risk, with earlier and more predictable returns for the Company”
Dr.Jon Moore, Chief Scientific Officer and Vice President, Oncology, said: “We anticipate that applying our technologies in a focused way will deliver valuable new targets for many cancer types that have not yet been proved treatable by existing therapies. Our goal is to bring the prospect of cures and long-lasting remission to millions more patients, and we believe that our technology and approach provides us with an advantage in finding these targets.”