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Oct 1

DEINOVE: 2020 Half-year Results: Stronger Financial Position and Research Programs Moving Forward Despite the International Context – Business Wire

MONTPELLIER, France--(BUSINESS WIRE)--Regulatory News:

DEINOVE (Paris:ALDEI) (Euronext Growth Paris: ALDEI), a French biotech company, pioneer in the exploration and exploitation of bacterial biodiversity to address the urgent, global challenge of antibiotic resistance and the need for next-generation active ingredients serving Health, announces that its Board of Directors has approved the financial statements for the first half of 2020.

Charles Woler, Chairman and Chief Executive Officer of DEINOVE, stated: "In the uncertain health and economic context that characterizes 2020, DEINOVE was able to stay the course. Our financial position has improved, and our operating loss has been reduced.

At the same time, we continued our efforts to advance the programs, including the DNV3837 clinical trial, which continued recruiting patients with the support of the investigating physicians, despite the health situation in the United States. Our upstream research programs (AGIR) have also advanced, with completion of the second key milestone, and we continue our efforts to provide the industry with new active substances.

Now led by Alexis RIDEAU, our team is resolutely pursuing its activities with three clear objectives: strengthen the companys presence in the pharmaceutical sector, generate revenues through strategic partnerships in the biotechnology sector, excel in project management in order to control all of our expenses and maintain financial flexibility."


The DEINOVE Groups consolidated financial statements at June 30, 2020 were subject to a limited review by the Groups statutory auditors, the firm PwC (PricewaterhouseCoopers).


(in thousands of euros)



Operating revenues



Of which operating grants



Operating costs

5 480

6 587

Of which Research & Development costs

4 460

5 412

Of which Administrative and General costs

1 020

1 175


- 4 884

- 6 181


- 6

- 14


- 34

- 49

Income tax and deferred taxes

- 544

- 1 140

Goodwill amortization



Results from equity affiliates (MEQ)



- 4 634

- 5 359

(in thousands of euros)



Term deposit



Provision for impairment of marketable securities



Cash on hand

3 193

1 095

ICNE and bank overdrafts




3 193

1 095



DNV3837: Initiation of Phase II clinical trial in Clostridioides difficile infections

The Phase II trial testing the antibiotic candidate DNV3837 in Clostridioides difficile1 gastrointestinal infections (CDIs), enrolled its first patient in January2.

This trial aims to evaluate the efficacy of DNV3837 in a pathological context, in patients with moderate to severe CDI, as well as to consolidate safety and pharmacokinetic data. The trial is multicentric and concentrated in the United States where prevalence is higher and regulatory authorities are looking for new therapeutic options.

Post-closing3, DEINOVE confirmed the continuation of this trial despite the tense health context in the United States, related to the Covid-19 pandemic. Several of the investigative centers have maintained their clinical research activities and continue to screen and include patients. The DEINOVE scientific team and the CRO Medpace are following the situation closely.

AGIR program: DEINOVE validates the second key milestone and receives 1.5M from Bpifrance 4

The challenge for AGIR is to accelerate exploration of the antibiotic activities of multiple strains under various conditions in order to rapidly detect new structures.

The first stage of the program had led to the setting up of a robotic platform for extracting and screening strains. The second stage allowed the screening of an increasing number of strains, the validation of the automated tools developed by DEINOVE and the detection of some thirty hits. The characterization of active extracts makes it possible to identify potential new, previously unknown, bioactive molecules.

According to the terms of the collaborative research program selected in 2017 by the Investments for the Future program, the results obtained enabled DEINOVE to validate the EC2 of the AGIR program and to receive 1.5M.


New industrial production of Phytoene to supply the market5

In early 2020 DEINOVE launched the production of a new batch of phytoene-based active ingredient to meet the needs of its distributors. The product has been sampled by nearly 100 brands, which are carrying out various projects for the development of cosmetic products incorporating this active ingredient.

Launch of a new active ingredient based on Neurosporene, an exclusive carotenoid6

Neurosporene is a novel carotenoid on the market with exceptional antioxidant properties. It has the particularity of absorbing blue light, responsible for early aging of the skin, including the formation of brown spots. Efficacy studies, particularly clinical studies, have demonstrated its beneficial effect on the health and beauty of the skin.

The introduction of this active ingredient to the market was initiated in April 2020.

Commercial launch of the new active ingredient co-developed with Hallstar France7

BIOME Oloactif is an active ingredient produced from a rare extremophilic bacterium that DEINOVE has managed to cultivate, and whose potential is reinforced by the original oleo-eco-extraction technique patented by Hallstar France (formerly Olos). Thanks to its unique composition of innovative active molecules, it helps strengthen the skins barrier function.

The official launch of this active ingredient took place in April 2020.

The planned partnership with Sharon Laboratories is finally abandoned

In February 2020 DEINOVE announced the signing of a Memorandum of Understanding (MoU) with the Israeli group Sharon Laboratories8 for the development and marketing of an innovative range of bio-based cosmetic ingredients. This agreement was to be finalized before the end of March 2020. The rapid development of the Covid-19 pandemic and the deterioration of economic conditions doomed this project9, given the significant uncertainties in the short term. DEINOVE retained the $200K collected on the signature of the MoU.


The consolidated financial statements of the DEINOVE Group for the first half of 2020 include the accounts of the Company, as well as the accounts of the wholly-owned subsidiary MORPHOCHEM.


The Group recorded 596K in operating revenue over H1, mainly comprising the payment by Bpifrance of the grant corresponding to the completion of the second key milestone of the AGIR program for an amount of 381K, and the amount received from Sharon Laboratories on the signature of the MoU (181K), amount that was retained despite the abandonment of the partnership caused by the Covid-19 pandemic and the deterioration of economic conditions.

For the first half of 2019, operating income amounted to 405K, mainly including the part of the grant corresponding to the first milestone of the AGIR program (397K).

During the first half of 2020, the Groups operating expenses reached 5.5M, of which 81% was spent on R&D activities.

When comparing H1 2019 and H1 2020, operating expenses are down 17% (-1.1M). Subcontracting and external study expenses, which mainly include CRO services related to the DNV3837 clinical study, decreased by 28%, mainly due to the internalization of certain operations. The Rents, Maintenance and Servicing costing item decreased by 31%, as a result of the second quarter rent waiver as part of the Covid-19 support measures. Miscellaneous Expenses (+38% over the period), include 36K of OCA-related costs. Fees increased by +10% due to costs incurred with Sharon Laboratories (76K) and pre-financing costs of the R&D Tax Credit (23K). The Missions and Travel item is down -66%.

Staff expenses decreased by -16%, with 2 FTE less and use of partial activity for the teams based in Lille. Depreciation, Amortization and Provisions (-7%), include a provision for risk on the amount of the R&D Tax Credit 2019 (28K) and 2020 (9K). The 2019 R&D Tax Credit has since been formally validated for its full amount by the tax authorities.


The consolidated net loss for the period amounts to 4.6M. It includes a negative financial result of -6K mainly comprising a gain on securities transactions related to the liquidity contract (+5K) and financial expenses related to leasing, pre-financing of the R&D Tax Credit and foreign exchange losses (- 11K in total).

Income tax includes almost exclusively the R&D Tax Credit. The Groups receivable for the first half year was estimated at 544K (compared to 1.140K in H1 2019).

The Exceptional Result at June 30, 2020 is mainly composed of a provision of 38K related to certain expenses charged to the 2019 and 2020 R&D Tax Credit (including 28K for 2019). The eligibility of these expenses on the 2019 R&D Tax Credit has since been validated by the Direction Dpartementale des Finances Publiques (Public Finance Departmental Director) by a letter dated 04/09/2020.


Financial requirements for the first half of the year mainly concerned operating expenses, for 4.9M (excluding depreciation and amortization), to which were added investments in laboratory equipment (including lease payments) for 0.1M.

Over the same period, the Group received 1.5M in public aid under the AGIR program and 2.1M under the 2019 R&D Tax Credit (via pre-financing by Socit Gnrale Factoring). DEINOVE received the sum of 2.5M (net) under the second and third tranches of the OCA subscribed by the ESGO Fund (L1 Capital). At June 30, 2010, the Groups net financial position amounted to +3.2M.

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DEINOVE: 2020 Half-year Results: Stronger Financial Position and Research Programs Moving Forward Despite the International Context - Business Wire

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