Open Orphan plc (LON:ORPH), a rapidly growing specialist pharmaceutical services clinical research organisation (CRO) and a world leader in vaccine and antiviral testing using human challenge clinical trials, has confirmed that, following its announcement on 13 April 2021, it has received Court approval for the reduction in capital. The reduction of capital will become effective on registration of the Court order at Companies House, which is expected to occur in the next few days.
The reduction of capital will give the Company the ability to not only effect the Distribution in Specie, as part of the proposed spin-out of certain non-core Development IP Assets, but also to make other distributions to Shareholders and/or buy back its own Open Orphan Ordinary Shares in the future if and when the Directors may consider that it is appropriate to do so.
As previously announced, the Board has decided that a spin-out and admission to AIM of the wholly owned Development IP Assets may provide the opportunity to secure separate financial resources for the Development IP Assets, with the goal of enabling accelerated development of the asset portfolio and achievement of development and commercial milestones. The Development IP Assets include HVO-001, an orally available, small molecule immunomodulator drug with potential as a treatment for severe influenza and symptoms requiring treatment in hospital with the drug unaffected by viral heterogeneity. It has the potential to treat a broad range of serious unmet needs in patients suffering from severe and fatal respiratory disease.
It is anticipated that a spin-out pursuant to the Demerger would allow the Company’s shareholders to benefit from both the value of the Development IP Assets and the standalone value of the remaining business as it progresses through its own key milestones.
The Company continues to make good progress towards delivering against the potential Demerger and Distribution in Specie and will update shareholders in due course.
Terms defined in the Company’s circular dated 13 April 2021 shall have the same meanings in the announcement.
Cathal Friel, Executive Chairman of Open Orphan plc commented: “We are delighted to have received Court approval of the reduction of capital. The reduction of capital will allow us to return value to shareholders as we go forward either as a distribution in specie as part of the proposed spin-off or through a share buy back or a payment of a dividend, as appropriate. The Company and the entire Open Orphan team have made significant progress in the past year and we remain on target with all of our plans as we continue to build the company going forward.”