In its half-year results for the year to 30 June 2021,  Arix Bioscience (ARIX ) said it has made “strong progress” in new clinical data, trial initiations and successful financing rounds.  

The biotechnology-focused global venture capital company said it saw strong progress particularly within its portfolio of public and private portfolio companies. Collectively, its companies successfully raised over $690 million in 2021, ‘from a broad base of investors.’ 

Despite the challenges faced as a result of the ongoing COVID-19 pandemic, Arix’s portfolio companies continued to make strong clinical and operational progress during the period. 

The Company’s Amplyx Pharmaceuticals was acquired by Pfizer, following strong Phase 2 clinical data from its lead product candidate, Fosmanogepix, in invasive fungal infections. 

Arix said its portfolio saw ‘continued clinical progress’ with data readouts from Harpoon, Imara and Autolus as well as new trial initiations from LogicBio, Harpoon, Artios and Autolus. 

In total, its portfolio companies have collectively raised over $690m in 2021 which Arix said reflects “a strong position” to execute on their important clinical development programmes. 

Over the period, Arix reported net asset value at £281.2m (December 2020: £328.2 million); 214p per share (December 2020: 242p); a 12% decrease in NAV per share for 1H21. 

As at period-end, Arix reported cash at £163.8 million (December 2020: £174.4 million) with £27.6 million of capital deployed and £32.0 million of capital realised during the period. 

Commenting on the results, Robert Lyne, Interim Chief Executive of Arix said: “Collectively our companies have raised over $690 million in 2021, from a broad base of investors. 

 We continued to expand the portfolio with the addition of Pyxis Oncology, where we led the Series B financing round, while exiting Amplyx, which was acquired by Pfizer in April 2021.” 

Arix said data generated from its clinical pipeline will be ‘a key driver of value’. It said that whilst clinical development is not without risk, and the recruitment of clinical trials globally has been impacted by COVID-19, it has several portfolio groups approaching key milestones. 

In particular, Arix said it expects Harpoon, a clinical-stage immuno-oncology company,  to report interim data from ongoing Phase 1/2 clinical trials in ovarian and pancreatic cancer (HPN536), multiple myeloma (HPN217) and small cell lung cancer (HPN328) during 2H21.  

Meanwhile, the Company said it also expects its portfolio company, Artios, a group which is focused on developing first-in-class treatments for cancer, to initiate a Phase 1 clinical study in 2H21 for its Pol-theta inhibitor (ART4215) for the treatment of PARP resistant cancers. 

"Whilst the volatility of public companies has impacted our financial performance during the period, our focus remains on the clinical progress of these businesses. This is what we believe will drive their value in the future. Importantly, these companies are well capitalised and therefore in a strong position to reach their important clinical milestones,” said Lyne. 

Reasons to  ARIX

Arix Bioscience plc is a global venture capital company focused on investing in and building breakthrough biotech companies around cutting-edge advances in life sciences. 

Hardman and Co. research said that last year’s “strong interim results, which saw the NAV rise 24% to £251.0m, highlighted the enormous disconnect between this and its share price. ARIX has prioritised 11 portfolio companies on which to focus its resources and expertise.” 

The investment research firm highlighted that these portfolio companies have “a number of important value inflection points - mostly clinical events - over the next 12-18 months.”  

Not only did results for 1H20 exceed market expectations, but as at 30 June 2020, ARIX had £44m of cash to support existing portfolio companies, early-stage companies, and operations.  

Arix refocused and streamlined the business by significantly reducing net operating costs by over 35% to an annual run rate of around £5m by the end of 2021 down from £8m in 2019. Pre-tax profit therefore turned positive to £48.96m compared to a loss in 1H19 of £44.81m. 

During the 1H20 period, Arix’s portfolio companies raised $392m of working capital, while since its inception, ARIX has deployed £149m into its portfolio, realised £13m through opportunistic divestments, and generated an IRR of 20% (realised and unrealised).   

Arix’s portfolio continues to make ‘strong progress’, with a number of companies reaching important clinical milestones and completing further financing rounds at higher valuations.  

‘With a number of upcoming clinical events, ARIX has set an aspirational target to make an annual IRR of 15%-25%, and produce an NAV of £500m by the end of 2023,’ said Hardman.  

Looking ahead, Arix cited potential for M&A, strategic partnerships and other financing events which could significantly increase the value of its companies, and in turn its NAV.  

‘Whilst the development of important new medicines always carries risk, over the next three years we expect to see at least two additional IPOs across the portfolio and at least two exits.’  

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