Cathal Friel & Mo Khan of Open Orphan expect 2021 to be EBITDA positive on revenues of £40m

Cathal Friel, Executive Chairman & Mo Khan, CEO of Open Orphan #ORPH discuss their trading update where they expect 2021 to have been EBITDA positive, on revenues of approximately £40m & with cash as of 31th December at £15.6m. 

Trading Update

Subject to completion of the audit, the Company expects both revenues and EBITDA to be in line with the expectation detailed at the time of the interim results.  Accordingly the Company expects 2021 to be EBITDA positive with revenues of approximately £40m. Cash and cash equivalents as of 31 December 2021 was £15.6m (30 June 2021: £14.9m). The Company further expects to be in line with management expectations for year-ending 31 December 2022, targeting revenues in the region of £50m in non-COVID-19 work. COVID-19 revenue for 2022 will be in addition to this and will depend on the eventual timing of these studies.

Facilities Expansion

The new facilities will double the Company's previous volunteer screening capacity, significantly boosting its ability to identify and enrol study volunteers and patients and further strengthening its world leading human challenge capabilities.

As part of the opening of a new specialised volunteer recruitment facility in London, the Whitechapel quarantine clinic and the Queen Mary's Bioenterprises Centre ("QMB") clinic will both be exclusively dedicated to conducting human challenge studies going forward. The space at QMB currently providing volunteer screening will be converted into further quarantine bedrooms. As such, the Company's QMB facility will expand to 31 beds, adding to the Whitechapel Clinic's 19 beds and the Plumbers Row Facility's 12; in total the Company's bed count will reach 62. These new facilities offer an opportunity to the Company to expand the scope of the business to offer Phase I and Phase II vaccine field trials, PK (pharmacokinetics) studies, bridging studies, and patient trials (as opposed to healthy volunteer human challenge trials) as part of large international multi-centre studies which do not require a quarantine setting. 

The increase in volunteer recruitment capacity will enable the Company to recruit larger cohorts more quickly than before and cement Open Orphan's world leading position and reputation in volunteer recruitment. Particularly in Manchester, the secondary facility extends the Company's reach for more volunteers and facilitates the increasing demand for human challenge studies. During volunteer screening there are large numbers of volunteers that are ineligible to take part in challenge studies for a variety of reasons, such as previous infection by the virus under investigation. By broadening the business offering to include Phase I and Phase II field trials, a large proportion of the volunteers already in the FluCamp facility could be eligible to take part in these studies.

The Plumbers Row Facility, London, plus the volunteer recruitment facility in Manchester, will have additional laboratory capacity, meaning samples collected during volunteer screening visits can be processed and stabilised on site. As a result, the primary laboratory at QMB has the capacity to expand its virology lab services business and increases its biomarker and molecular testing capabilities.

In addition, the Company's corporate office will move from Alie Street to an upper floor in Plumbers Row. Both London and Manchester facilities offered attractive terms; the new Plumbers Row space is c. 9,000 sq ft and is a third of the cost of the current space of 4,000 sq ft; the new Manchester facility comes at the same cost as the old facility, but with four times the floor space at c. 2,000 sq ft.