Guildford, UK, 5 April 2006: ReNeuron Group plc (AIM: RENE) announces that it proposes to raise up to £8.5 million via a non pre-emptive placing of new ordinary shares and American Depositary Shares (ADSs) (the “Placing”). The Company intends that institutional investors (including US and certain existing institutional shareholders) will participate in the Placing. The proceeds of the Placing will be used to fund the Company’s lead ReN001 programme for stroke as it progresses to the clinic, and also to fund the Company’s other therapeutic programmes based on recently announced progress made.
The Directors believe that the Placing will enable ReNeuron to widen its US shareholder base and enhance the Company’s profile in the US, where much of the Company’s activities concerning its lead ReN001 stroke programme are currently focussed. The Directors further believe that an enhanced profile in the US market will provide greater liquidity in the Company’s shares and serve to increase the overall value of the Company in the medium to longer term, to the benefit of all shareholders. To this end, the Directors intend to consider listing the Company’s shares in the US in due course, subject to market conditions, the ability of the Company to meet applicable listing requirements and the Directors then judging that such a listing is in the best interests of the Company and its shareholders as a whole.
ReNeuron has made significant progress with its stem cell programmes since its Admission to the London AIM Market last August, as outlined below:
- confirmation of the Company’s pre-clinical development programme for its ReN001 stroke therapy, following the formal pre-IND1meeting between the Company and the US Food and Drug Administration (FDA) in July 2005. Based on the results of this programme thus far, the Company expects, in the second half of 2006, to file for approval to commence initial clinical trials in the United States with ReN001;
- repeat positive efficacy and dose-response pre-clinical data generated for ReN001, together with first results from late pre-clinical safety studies indicating that the ReN001 stem cells do not form tumours following implantation;
- completion of the manufacturing scale-up of both master and working cell banks for ReN001 to Good Manufacturing Practice (GMP) standards. These cell banks contain the material from which the Company expects all future clinical and in-market supplies for ReN001 will ultimately be drawn;
- manufacturing contract entered into with Angel Biotechnology Holdings plc to scale up production of ReNeuron’s ReN005 stem cell line for Huntington’s disease. This contract initially covers the production of a GMP-compliant master cell bank;
- initial pre-clinical data for the Company’s ReN004 candidate stem cell lines generated showing them to have attributes that may favour the reversal of the neurological deficits seen in Parkinson’s disease; and
- key functional data concerning the Company’s second generation ReNcell hepatocyte (liver) cell lines generated, indicating their high potential utility as a drug toxicology testing and screening tool.
Commenting on the Company’s plans Michael Hunt, Chief Executive Officer of ReNeuron, said:
“Since ReNeuron’s flotation on AIM last summer, we have made steady progress in both our therapeutic and ReNcellTM programmes. Although our current financial resources will fund the Company’s activities well into 2007, we believe that it is appropriate to seek a judicious amount of further funding at this time. This will allow us to build quickly on recent progress across our therapeutic programmes as well as furthering our investor profile in the US, which we regard as an important factor in the Company’s future success.”
ReNeuron is today calling an extraordinary general meeting (EGM) to propose a Special Resolution permitt ing the Company to issue new ordinary shares and ADSs for cash on a non pre-emptive basis. The EGM will be held on 28 April 2006 at 2:30pm at the offices of Morrison & Foerster, 7th Floor, CityPoint, One Ropemaker Street, London EC2Y 9AW.
As at today’s date, no agreement has yet been entered into committing the Company to issue, or any person to subscribe for shares as part of, the proposed Placing. In particular no underwriting agreement has been entered into in respect of the proposed Placing. In addition, the Placing is conditional upon shareholder approval.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the ordinary shares or ADSs in any jurisdiction in which such offer, solicitation or sale would be unlawful. The ordinary shares and ADSs to be offered in the Placing have not been and will not be registered under the U.S. Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
1 Investigational New Drug application
Notes to editors
ReNeuron is a leading, UK-based adult stem cell therapy business. The Company is applying its novel stem cell platform technologies in the development of ground-breaking stem cell therapies to serve significant and unmet or poorly-met clinical needs.
ReNeuron has used its c-mycERTAM technology to generate genetically stable neural stem cell lines. This technology platform has multi-national patent protection and is fully regulated by means of a chemically-induced safety switch. Cell growth can therefore be completely arrested prior to in vivo implantation.
The Company’s lead stem cell therapy, ReN001 for chronic stroke disability, is in late pre-clinical development. Subject to successful completion of pre-clinical testing, the Company plans to file for approval to commence initial clinical trials in stroke later this year, with trials commencing as soon as possible thereafter.
The Company has also generated pre-clinical efficacy data with its ReN005 stem cell therapy for Huntington’s disease, a rare, genetic and fatal neurodegenerative disorder which affects around 1 in 100,000 people. This programme is in pre-clinical development.
In addition to its stroke and Huntington’s disease programmes, ReNeuron is developing stem cell therapies for Parkinson’s disease, Type 1 diabetes and diseases of the retina.
ReNeuron has also leveraged its stem cell technologies into non-therapeutic areas – its ReNcellTM range of cell lines for use in drug discovery applications in the pharmaceutical industry.
ReNeuron’s shares are traded on the London AIM market under the symbol RENE.L, and its warrants are traded under the symbol RENW.L.
Further information on ReNeuron and its products can be found at www.reneuron.com.
Michael Hunt, Chief Executive Officer
Tel: 44 (0)1483 302 560
Tel: 44 (0)20 7831 3113
The terms “ReNeuron” or “the Company” refer to ReNeuron Group plc and its subsidiary undertakings.
This announcement is not for distribution in the United States, Canada, Japan or Australia.