BullsEye Insights

BullsEye: Daily London AIM RNS Round-Up

Monday 29 June 2020

Here is our summary of the day's hottest RNS alerts from across London's Alternative Investments Market (AIM).

OptiBiotix Health (OPTI.LSE)

Launch of WellBiome

OptiBiotix Health Plc, a life sciences business developing compounds to tackle obesity, high cholesterol, diabetes and skin care, announces the launch of WellBiome®, a proprietary blend of prebiotic functional fibres, functional dietary fibres and mineral optimised for health and wellbeing by promoting the diversity of the gut microbiome.

WellBiome® is an evolution of SlimBiome®, a functional ingredient sold in more than 70 countries (RNS: 18 May 2020) formulated to support weight loss and weight management. WellBiome® provides a scientifically formulated, patented and trademarked solution for partners to either enter into, or extend, their product value proposition into the health & wellness market using functional ingredients to improve immune, digestive, heart, or metabolic health.

A recent NutritionInsight expert roundtable discussion on how the industry is coping with the COVID-19 aftermath and future trends, concluded that the pandemic has prompted a significant focus on health and wellbeing amongst consumers. Topics such as immune health and staying fit & healthy are all at the forefront of minds at present and broader issues such as gut health (WellBiome ® ) and weight management (SlimBiome ® ) are of increased interest to consumers.

The Health & Wellness industry was estimated to be worth US$4.2 trillion in 2019 with the digestive health segment accounting for US$60 billion. Moreover, an estimate from Global Market Insights said the global prebiotics market will reach US$7.2 billion by 2024, a significant increase from 2016, when the market value was US$3.4 billion.

For the full RNS, see: https://www.investegate.co.uk/optibiotix-health--opti-/rns/launch-of-wellbiome/202006290700062716R/

Omega Diagnostics (ODX.LSE)

Update on progress of UK-Rapid Test Consortium

Omega, the medical diagnostics company focused on CD4, infectious diseases and food intolerance notes the Press Release issued today by UK Rapid Test Consortium ("UK-RTC") on developing a COVID-19 lateral flow antibody test ("COVID-19 Rapid Test") that can be used by people in their homes.

As announced on 9 April 2020, the Company signed a Memorandum of Understanding ("MOU") with Abingdon Health Limited, BBI Solutions Limited, CIGA Healthcare Limited, in conjunction with the University of Oxford to form the UK-RTC in order to jointly develop and manufacture a COVID-19 Rapid Test as part of the Government's five pillar national testing strategy for COVID-19. 

Abingdon Health Limited, lead partner of the UK-RTC, has informed consortium members that it has attained design freeze for the COVID-19 Rapid Test. The next stage is for Abingdon Health to complete verification, validation, transfer the manufacturing protocols to consortium members and gain regulatory approval. 

The transfer of the manufacturing process to Omega will enable it to undertake its own validation work to prove equivalent performance and to demonstrate the test can be manufactured at scale to meet the UK Government's demand. These activities will commence immediately, and the Company expects to complete this work by the end of August.  Initially it is the Company's plan to produce 100,000 tests per week scaling up to 200,000 tests per week by the end of September. Based on demand for its wider COVID-19 test portfolio, Omega has flexibility in the utilisation of its overall manufacturing capacity so that more could be allocated to the UK-RTC if required.

For full RNS details, see: https://www.investegate.co.uk/omega-diagnostics-gp--odx-/rns/update-on-progress-of-uk-rapid-test-consortium/202006290700072935R/

Advanced Oncotherapy (AVO.LSE)

Strategic funding partnership and debt facility

Strategic €20 million funding partnership with VDL Groep expanding close partnership with existing supplier, VDL ETG Precision

Nerano Pharma to provide $30 million debt facility

Advanced Oncotherapy will use facilities to further develop and advance manufacturing of additional LIGHT systems to address unmet medical need.

Advanced Oncotherapy, the developer of next-generation proton therapy systems for cancer treatment, today announced that it has entered into two financing agreements, providing the Company access to up to approximately £42 million of additional funding to further the development of the LIGHT system and advance the manufacturing of up to 30 LIGHT systems.

Advanced Oncotherapy has entered into an unsecured debt facility agreement with existing supplier VDL ETG Precision BV, a subsidiary of VDL Groep BV, for €20.0 million (the "VDL Facility"), and has also entered into an interest-bearing secured convertible facility with Nerano Pharma Limited ("Nerano Pharma"), a financing vehicle wholly owned by Seamus Mulligan, for up to $30 million (the "Nerano Facility"). Further details of both facilities are set out below.

Nicolas Serandour, CEO of Advanced Oncotherapy, commented:

"We are pleased to announce these debt facilities from VDL Groep and Nerano Pharma, which will allow the Company to further the assembly and certification of our LIGHT system and to advance our pipeline of construction opportunities. We have a long-standing relationship with VDL ETG Precision as a current supplier to our business and we look forward to strengthening this partnership as they help build our business for future orders. In addition, we are delighted with the continued financial support provided by Seamus Mulligan, a significant shareholder in the Company.

"The proton therapy market is still characterised by a highly unmet medical need due to rising populations, only 200 treatment rooms today globally but a need of at least 10,000 treatment rooms if only 20 per cent. of patients undergoing radiotherapy are treated with proton therapy. This additional funding will help us build further LIGHT systems to assist patients across the world, lowering the cost of proton therapy whilst providing more opportunities for treatment and improving patient outcomes."

About the VDL Facility

VDL ETG Precision BV is part of VDL Groep, an industrial family-owned group of companies, and manufactures precision parts, prototypes, sub-assemblies and modules used in the Advanced Oncotherapy's LIGHT System. Advanced Oncotherapy and VDL ETG Precision have the common intention to collaborate in a number of additional areas beyond the activities currently performed by VDL ETG Precision.

The objectives of this collaboration are to ensure a fast delivery of LIGHT systems at an affordable price for users and to position the parties at the forefront of clinical innovation and precision manufacturing.

The Company has entered into the unsecured loan agreement with VDL Participatie BV (the "VDL Agreement"), a member of VDL Groep BV. Under the terms of the VDL Agreement, Advanced Oncotherapy may issue drawdown requests during the six-year commitment period and amounts drawn down will be related to purchase orders placed by Advanced Oncotherapy and VDL ETG Precision and associated with the sale of LIGHT systems to customers.

Advanced Oncotherapy shall repay each loan in full, three years after the initial drawdown date, with the option to voluntarily repay part of or all of the loan in advance. Each loan carries a rate of interest of 5 per cent. per annum payable annually in cash.

About the Nerano Facility

Nerano Pharma is a financing vehicle wholly owned by Seamus Mulligan, a significant shareholder in Advanced Oncotherapy.

The Company has entered into an interest-bearing secured convertible facility with Nerano Pharma for up to $30 million (the "Nerano Agreement"). Advanced Oncotherapy may issue drawdown requests at any time during the three-year term of the Nerano Facility.

A rate of interest of 5 per cent. per annum will accrue on all amounts drawn under the Nerano Facility, paid annually in cash on each anniversary of the Nerano Facility with the option for the Company to defer payment of that interest until the maturity date of the Nerano Facility on 29 June 2023 (without penalty). On the maturity date all amounts drawn under the Nerano Facility and any interest accrued thereon shall be repayable by the Company. The Nerano Facility provides an option for the Company to voluntarily repay part, or all, of the loan (along with any accrued interest) prior to the maturity date. The Nerano Facility is secured on the LIGHT components being built in Daresbury and Geneva and associated intellectual property. Nerano Pharma will be entitled to a share of the profit generated by the Harley Street centre for up to 15 years.

Nerano Pharma may, at its sole discretion, convert: (i) any amount that the Company has opted to voluntarily prepay during the life of the Nerano Facility; and (ii) at maturity of the Nerano Facility in June 2023, any outstanding loan amounts and interest payable, in each case, into new ordinary shares in Advanced Oncotherapy at a price of 25 pence per ordinary share. Conversion of any voluntary prepayment can take place at any time on and from the date on which the Company originally proposed to make that voluntary prepayment and in all circumstances interest will cease to accrue on that voluntary prepayment amount from the originally proposed voluntary prepayment date. Under the terms of the Nerano Agreement, the Board may only issue a drawdown request if it confirms to Nerano Pharma that, as a result, Nerano will have a beneficial interest which is less than 29.9 per cent. of the Company's issued capital upon conversion, taking into account the convertible instruments the Company has issued.

Pursuant to the terms of the Nerano Agreement, Advanced Oncotherapy has today granted 5 million warrants to subscribe for new ordinary shares to Nerano Pharma exercisable until 28 June 2025 at an exercise price of 50 pence. Advanced Oncotherapy will pay to Nerano Pharma a cash commitment fee of 2 per cent. of the total facility upon first drawdown or at maturity.

For full RNS details, see: https://www.investegate.co.uk/advanced-oncotherapy--avo-/rns/strategic-funding-partnership-and-debt-facility/202006290700082975R/

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