Exhibit 99.1

NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

						For the Three Months Ended June 30								For the Six Months Ended June 30,
		Notes				2020				2019				2020				2019
						(in thousands, except per share data)
						£				£				£				£
Research and development expenses							(5,863	)			(5,356	)			(11,801	)			(9,706	)
Administrative expenses							(1,629	)			(1,462	)			(3,238	)			(2,808	)
Net foreign exchange gains (losses)							84				943				2,211				(37	)
Operating loss							(7,408	)			(5,875	)			(12,828	)			(12,551	)
Finance income							64				297				208				616
Loss before tax							(7,344	)			(5,578	)			(12,620	)			(11,935	)
Income tax credit			3				1,283				1,108				2,593				2,108
Loss for the period							(6,061	)			(4,470	)			(10,027	)			(9,827	)
Basic and diluted loss per share			4				(0.19	)			(0.14	)			(0.31	)			(0.30	)

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

 

		For the Three Months Ended June 30,								For the Six Months Ended June 30,
		2020				2019				2020				2019
		(in thousands)
		£				£				£				£
Loss for the period			(6,061	)			(4,470	)			(10,027	)			(9,827	)
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations			1				6				22				1
Other comprehensive income for the period			1				6				22				1
Total comprehensive loss for the period			(6,060	)			(4,464	)			(10,005	)			(9,826	)
Attributable to:
Equity holders of the Company			(6,060	)			(4,464	)			(10,005	)			(9,826	)

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

2

NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

AS AT

 

						June 30, 2020				December 31, 2019
						(in thousands)
		Notes				£				£
Assets
Non-current assets
Intangible assets			5				4,534				3,960
Property, plant and equipment							917				1,109
Deferred tax asset			3				40				46
							5,491				5,115
Current assets
Prepayments, accrued income and other receivables							3,877				4,710
Current income tax receivable			3				6,932				8,481
Cash and cash equivalents			6				47,800				51,962
							58,609				65,153
Total assets							64,100				70,268
Equity and liabilities
Capital and reserves
Share capital and share premium			8				82,783				80,840
Other reserves							64,360				62,737
Accumulated deficit							(90,014	)			(80,055	)
Total equity attributable to equity holders of the Company							57,129				63,522
Non-current liabilities
Provisions							26				26
Lease liabilities							429				538
							455				564
Current liabilities
Trade payables							1,928				2,412
Payroll taxes and social security							151				160
Lease liabilities							246				268
Accrued expenditure							4,191				3,342
							6,516				6,182
Total liabilities							6,971				6,746
Total equity and liabilities							64,100				70,268

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

3

NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

 

		For the Six Months Ended June 30,
		Share capital				Share premium				Own share reserve				Share option reserve				Foreign currency translation reserve				Capital reserve				Accumulated deficit				Total equity attributable to equity holders
		(in thousands)
		£				£				£				£				£				£				£				£
Balance at January 1, 2019			1,289				79,426				(339	)			17,564				1				42,466				(58,813	)			81,594
Loss for the period			—				—				—				—				—				—				(9,827	)			(9,827	)
Other comprehensive income for the period			—				—				—				—				1				—				—				1
Total comprehensive loss for the period			—				—				—				—				1				—				(9,827	)			(9,826	)
Share-based payments			—				—				—				1,166				—				—				—				1,166
Exercise of share options			1				85				—				(132	)			—				—				132				86
Surrender of fully vested share options			—				—				—				(38	)			—				—				38				—
Balance at June 30, 2019			1,290				79,511				(339	)			18,560				2				42,466				(68,470	)			73,020
Balance at January 1, 2020			1,299				79,541				(339	)			20,620				(10	)			42,466				(80,055	)			63,522
Loss for the period			—				—				—				—				—				—				(10,027	)			(10,027	)
Other comprehensive income for the period			—				—				—				—				22				—				—				22
Total comprehensive loss for the period			—				—				—				—				22				—				(10,027	)			(10,005	)
Share-based payments			—				—				—				1,669				—				—				—				1,669
Exercise of share options			1				14				—				(68	)			—				—				68				15
Issue of share capital			18				2,015				—				—				—				—				—				2,033
Share issue expenses			—				(105	)			—				—				—				—				—				(105	)
Balance at June 30, 2020			1,318				81,465				(339	)			22,221				12				42,466				(90,014	)			57,129

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

4

NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

		For the Six Months Ended June 30,
		2020				2019
		(in thousands)
		£				£
Cash flows from operating activities
Loss for the period			(10,027	)			(9,827	)
Adjustments for:
Income tax credit			(2,593	)			(2,108	)
Amortization and depreciation			440				336
Finance income			(208	)			(616	)
Interest expense on lease liabilities			14				—
Share-based payments			1,669				1,166
Net foreign exchange (gains) losses			(2,252	)			22
			(12,957	)			(11,027	)
Movements in working capital:
Decrease (increase) in prepayments, accrued income and other receivables			802				(1,518	)
Decrease in trade payables			(484	)			(164	)
Increase in payroll taxes, social security and accrued expenditure			840				1,063
Movements in working capital			1,158				(619	)
Cash used in operations			(11,799	)			(11,646	)
Net income tax received			4,152				11
Net cash used in operating activities			(7,647	)			(11,635	)
Cash flows from investing activities
Interest received			279				622
Payments for property, plant and equipment			(14	)			(21	)
Payments for intangible assets			(804	)			(734	)
Net cash used in investing activities			(539	)			(133	)
Cash flows from financing activities
Payments of lease liabilities			(148	)			(95	)
Proceeds from issue of share capital – exercise of share options			15				86
Proceeds from issue of share capital			2,033				—
Share issue expenses			(105	)			—
Net cash from (used in) financing activities			1,795				(9	)
Net decrease in cash and cash equivalents			(6,391	)			(11,777	)
Cash and cash equivalents at beginning of period			51,962				76,972
Effect of exchange rate changes on cash and cash equivalents			2,229				(21	)
Cash and cash equivalents at end of period			47,800				65,174

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

5

NUCANA PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

1.	General information

NuCana plc (“NuCana” or the “Company”) is a clinical-stage biopharmaceutical company developing a portfolio of new medicines to treat cancer. NuCana is harnessing the power of phosphoramidate chemistry to generate new medicines called ProTides. These compounds have the potential to improve cancer treatment by enhancing the efficacy and safety of several current standards of care.

The Company has ordinary shares in the form of American Depositary Shares (“ADSs”) registered with the US Securities and Exchange Commission (the “SEC”) and has been listed on The Nasdaq Global Select Market (“Nasdaq”) since October 2, 2017. The Company is incorporated in England and Wales and domiciled in the United Kingdom. The Company’s registered office is located at 77/78 Cannon Street, London EC4N 6AF, United Kingdom and its principal place of business is located at 3 Lochside Way, Edinburgh, EH12 9DT, United Kingdom.

The Company has two wholly owned subsidiaries, NuCana, Inc. and NuCana BioMed Trustee Company Limited (together referred to as the “Group”).

The comparative figures for the year ended December 31, 2019 are not the Group’s statutory accounts for that financial year within the meaning of section 434 of the Companies Act 2006. Those accounts have been reported on by the Company’s auditor and delivered to the Registrar of Companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

 

2.	Significant accounting policies

Basis of preparation

The unaudited condensed consolidated financial statements (the “financial statements”) for the three months and six months ended June 30, 2020 have been prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting” (“IAS 34”). The significant accounting policies and methods of computation applied in the preparation of the financial statements are consistent with those applied in the Company’s annual financial statements for the year ended December 31, 2019. No new standards, amendments or interpretations have had an impact on the financial statements for the three months and six months ended June 30, 2020. The financial statements comprise the financial statements of the Group at June 30, 2020. The financial statements are presented in pounds sterling, which is also the Company’s functional currency. All values are rounded to the nearest thousand, except where otherwise indicated.

The financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Company’s annual financial statements for the year ended December 31, 2019.

In the opinion of management, these unaudited condensed consolidated financial statements include all normal recurring adjustments necessary for a fair statement of the results of operations, financial position and cash flows. The results of operations for the three months and six months ended June 30, 2020 are not necessarily indicative of the results that can be expected for the Company’s fiscal year ending December 31, 2020.

Going concern

In common with many companies in the biopharmaceutical sector, the Company incurs significant expenditure in its early years as it researches and develops its potential products for market.

The Company’s board of directors, having reviewed the operating budgets and development plans, considers that the Company has adequate resources to continue in operation for the foreseeable future. The board of directors is therefore satisfied that it is appropriate to adopt the going concern basis of accounting in preparing the financial statements. The Company believes that its cash and cash equivalents of £47.8 million at June 30, 2020 will be sufficient to fund its current operating plan for at least the next 12 months. Further, the directors have conducted a full assessment of the impact of COVID-19 on the going concern status of the Company and have concluded that it will not have a significant negative impact on the cash outflows of the Company over the period assessed for going concern purposes. During the second quarter of 2020, the Company temporarily paused and then subsequently re-commenced the enrollment of new patients in clinical trials as a result of COVID-19, resulting in the costs relating to these activities being deferred.

 

6

As the Company continues to incur losses, the transition to profitability is dependent upon the successful development, approval and commercialization of its product candidates and achieving a level of revenues adequate to support its cost structure. The Company may never achieve profitability, and unless and until it does, it will continue to need to raise additional capital. The Company currently has sufficient cash reserves to fund operations at least into the fourth quarter of 2021. There can be no assurances, however, that additional funding will be available on acceptable terms.

COVID-19

In December 2019, a novel strain of the coronavirus SARS-CoV-2, which causes COVID-19, surfaced in Wuhan, China. Since then, COVID-19 has spread to multiple countries, including the United Kingdom and the United States.

In response to the spread of COVID-19, all of the Company’s offices have been closed with employees continuing their work outside of the offices and the Company has restricted on-site staff access to only those required to execute their job responsibilities.

Also, in April 2020, in response to the COVID-19 pandemic, the Company announced that in order to ease the burden on clinical trial sites and enable healthcare professionals to focus their efforts on caring for patients with COVID-19, the enrollment of new patients in the Company’s ongoing clinical trials was temporarily paused. There was no interruption to the treatment of patients enrolled at that time. Subsequently, in May 2020, the Company announced that enrollment of new patients in the Company’s global Phase 3 clinical trial for patients with biliary tract cancer (NuTide:121) has re-commenced in certain geographies, including Australia, Canada, South Korea, Taiwan, Ukraine and the United Kingdom. Additionally, in May 2020, the Company announced the re-commencement of new patient enrollment in the Phase 1 and Phase 1b clinical trials of NUC-3373 and the Phase 1 clinical trial of NUC-7738. While the Company continues to evaluate the impact of COVID-19 on its operations, the Company believes that this pandemic will inevitably cause some delays to the timing of initiation and completion of its clinical trials. The overall impact is currently unknown and the Company is continuing to monitor the COVID-19 pandemic as it evolves.

There is no impact on the judgements and estimates used in the preparation of these financial statements.

Judgements and estimates

The accounting estimates and judgements made by management in applying the Group’s accounting policies that have the most significant effect on the amounts included within these financial statements, were the same as those that applied to the annual financial statements for the year ended December 31, 2019.

 

3.	Income tax

 

		For the Three Months Ended June 30,								For the Six Months Ended June 30,
		2020				2019				2020				2019
		(in thousands)								(in thousands)
		£				£				£				£
Current tax:
In respect of current period U.K.			1,289				1,116				2,604				2,123
In respect of current period U.S.			(1	)			(1	)			(1	)			(2	)
			1,288				1,115				2,603				2,121
Deferred tax:
In respect of current period U.S.			(5	)			(7	)			(9	)			(13	)
In respect of prior period U.S.			—				—				(1	)			—
Income tax credit			1,283				1,108				2,593				2,108

The income tax credit recognized primarily represents the U.K. research and development tax credit. In the United Kingdom, the Company is able to surrender some of its losses for a cash rebate of up to 33.35% of expenditure related to eligible research and development projects.

 

7

		June 30,       2020				December 31, 2019
		(in thousands)
		£				£
Current income tax receivable
U.K. tax			6,928				8,477
U.S. tax			4				4
			6,932				8,481
Deferred tax asset
U.S. deferred tax asset			40				46

 

4.	Basic and diluted loss per share

 

		For the Three Months Ended June 30,								For the Six Months Ended June 30,
		2020				2019				2020				2019
		(in thousands, except per share data)
		£				£				£				£
Loss for the period			(6,061	)			(4,470	)			(10,027	)			(9,827	)
Basic and diluted weighted average number of shares			32,668				32,240				32,573				32,233
		£				£				£				£
Basic and diluted loss per share			(0.19	)			(0.14	)			(0.31	)			(0.30	)

Basic loss per share is calculated by dividing the loss for the period attributable to the equity holders of the Company by the weighted average number of shares outstanding during the period.

The potential shares issued through equity settled transactions were considered to be anti-dilutive as they would have decreased the loss per share and were therefore excluded from the calculation of diluted loss per share.

 

5.	Intangible assets

Intangible assets comprise patents with a carrying value of £4.3 million as of June 30, 2020 (as of December 31, 2019: £3.7 million) and computer software with a carrying value of £0.2 million as of June 30, 2020 (as of December 31, 2019: £0.3 million).

During the six months ended June 30, 2020, the Company acquired intangible assets with a cost of £0.8 million in relation to patents. There were no disposals of intangible assets in the six months ended June 30, 2020.

 

6.	Cash and cash equivalents

 

		June 30, 2020				December 31, 2019
		(in thousands)
		£				£
Cash and cash equivalents			47,800				51,962

Cash and cash equivalents comprise cash at bank with maturities of three months or less and earn interest at fixed or variable rates based on the terms agreed for each account.

 

7.	Share-based payments

The Company has six share-based payment plans for employees, directors and consultants. The share options granted under these plans are settled in equity. The six share-based payment plans include three new plans approved by shareholders at the annual general meeting of the Company on June 25, 2020. No awards have been granted under these new plans during the six months ended June 30, 2020.

 

8

As detailed in the table below, during the six months ended June 30, 2020, 2,186,780 share options were granted under the Company’s U.K. share-based payment plans and U.S. share option sub-plan (six months ended June 30, 2019: 1,088,150 share options granted). Options granted under these plans will vest if the option holder remains under respective contract of employment or contract of service for the agreed vesting period. The share options granted in the period will vest over a period of up to four years.

The fair values of options granted were determined using the Black-Scholes model that takes into account factors specific to the share incentive plan. As the Company completed its initial public offering in October 2017, it is not possible to derive historical volatility from the Company’s ADSs prior to October 2017. The underlying expected volatility was therefore determined by using the historical volatility of similar listed entities as a proxy. The volatility percentage applied to each tranche is the average of the historical volatility of comparable companies to the Company.

The following weighted average principal assumptions were used in calculating the fair values of options granted:

 

		Options granted on June 10, 2020
Vesting dates			June 10, 2021
			June 10, 2022
			June 10, 2023
			June 10, 2024
Volatility			76.59	%
Dividend yield			0	%
Risk-free investment rate			0.003	%
Fair value of option at grant date		£	2.76
Fair value of share at grant date		£	4.78
Exercise price at date of grant		£	4.78
Lapse date			June 10, 2030
Expected option life (years)			4.50
Number of options granted			2,186,780

For the three months ended June 30, 2020, the Company has recognized £0.8 million of share-based payment expense in the statement of operations (three months ended June 30, 2019: £0.8 million). For the six months ended June 30, 2020, the Company has recognized £1.7 million of share-based payment expense in the statement of operations (six months ended June 30, 2019: £1.2 million).

 

8.	Share capital and share premium

 

		June 30, 2020				December 31, 2019
		(in thousands)
		£				£
Share capital			1,318				1,299
Share premium			81,465				79,541
			82,783				80,840
		June 30, 2020				December 31, 2019
		Number (in thousands)
Issued share capital comprises:
Ordinary shares of £0.04 each			32,939				32,479

 

9

		Number of shares				Share capital				Share premium
		(in thousands)
Fully paid shares:						£				£
Balance at December 31, 2019			32,479				1,299				79,541
Issue of shares on exercise of options			32				1				14
Issue of shares			428				18				1,910
Balance at June 30, 2020			32,939				1,318				81,465

 

9.	Contingent liabilities

Under its U.K. share-based payment plan, the Company granted unapproved share options that have fully vested. If and when these share options are exercised, the Company will be liable for the Employer Class 1 National Insurance payable to HMRC in the United Kingdom. This contingent liability will be determined based on the market value of the shares on exercise less the exercise price paid by the option holders, at the prevailing rate of Employer National Insurance (currently 13.8%). Based on the closing price of the Company’s ADSs on the Nasdaq Global Select Market on June 30, 2020, the last trading day of the period to which these financial statements relate, and assuming full exercise of all outstanding and vested unapproved share options on that date, the Employer National Insurance contingent liability would have been £1.0 million (December 31, 2019: £1.3 million).

 

10.	Events after the reporting period

Proceeds from issue of share capital

Since the end of the reporting period the Company has issued 323,986 ADSs, representing 323,986 ordinary shares, raising gross proceeds of £1.5 million.

 

10

Exhibit 99.2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of financial condition and results of operations together with the unaudited condensed consolidated financial statements and the related notes to those statements included as Exhibit 99.1 to this Report on Form 6-K submitted to the Securities and Exchange Commission, or the SEC, on August 19, 2020. We also recommend that you read our discussion and analysis of financial condition and results of operations together with our audited financial statements and the notes thereto, and the section entitled “Risk Factors”, each of which appear in our Annual Report on Form 20-F for the year ended December 31, 2019 filed with the SEC on March 10, 2020, or the Annual Report, as well as the Supplemental Risk Factor with respect to the COVID-19 pandemic which appears in our Form 6-K filed with the SEC on April 2, 2020.

We present our unaudited condensed consolidated financial statements in pounds sterling and in accordance with International Accounting Standard 34, “Interim Financial Reporting,” or IAS 34, which may differ in material respects from generally accepted accounting principles in other jurisdictions, including generally accepted accounting principles in the United States, or U.S. GAAP.

Unless otherwise indicated or the context otherwise requires, all references to “NuCana,” the “Company,” “we,” “our,” “us” or similar terms refer to NuCana plc and its consolidated subsidiaries.

The statements in this discussion regarding industry outlook, our expectations regarding our future performance, liquidity and capital resources and other non-historical statements are forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks and uncertainties include, but are not limited to, the risks and uncertainties set forth in the “Risk Factors” section of our Annual Report and any subsequent reports that we file with the SEC.

Company Overview

We are a clinical-stage biopharmaceutical company focused on significantly improving treatment outcomes for cancer patients by applying our ProTide^™ technology to transform some of the most widely prescribed chemotherapy agents, nucleoside analogs, into more effective and safer medicines. While these conventional agents remain part of the standard of care for the treatment of many solid and hematological tumors, their efficacy is limited by cancer cell resistance mechanisms and they are often poorly tolerated. Utilizing our proprietary technology, we are developing new medicines, ProTides, designed to overcome key cancer resistance mechanisms and generate much higher concentrations of anti-cancer metabolites in cancer cells. Our most advanced ProTide candidates, Acelarin^® and NUC-3373, are new chemical entities derived from the nucleoside analogs gemcitabine and 5-fluorouracil, respectively, two widely used chemotherapy agents. Acelarin is currently being evaluated in multiple clinical trials, including a Phase 3 clinical trial for patients with biliary tract cancer, a Phase 1b clinical trial for patients with biliary tract cancer, a Phase 2 clinical trial for patients with platinum-resistant ovarian cancer, and a Phase 3 clinical trial for patients with metastatic pancreatic cancer for which enrollment has been suspended. NUC-3373 is currently in a Phase 1 clinical trial in patients with advanced solid tumors and a Phase 1b clinical trial in patients with advanced colorectal cancer. Our third ProTide, NUC-7738, is a transformation of a novel nucleoside analog (3’-deoxyadenosine) that has never been successfully developed or approved as a chemotherapy but has shown potent anti-cancer activity in preclinical studies. We are evaluating NUC-7738 in a Phase 1 clinical trial for patients with advanced solid tumors. We have retained worldwide rights to these lead product candidates as well as our preclinical product candidates, all of which we refer to as ProTides.

COVID-19

In April 2020, in response to the COVID-19 pandemic, we announced that in order to ease the burden on clinical trial sites and enable healthcare professionals to focus their efforts on caring for patients with COVID-19, the enrollment of new patients in our ongoing clinical trials was temporarily paused. There was no interruption to the treatment of patients enrolled at that time. Subsequently, in May 2020, we announced that enrollment of new patients in our global Phase 3 clinical trial for patients with biliary tract cancer (NuTide:121) has re-commenced in certain geographies, including Australia, Canada, South Korea, Taiwan, Ukraine and the United Kingdom. Additionally, in May 2020, we announced the re-commencement of new patient enrollment in the Phase 1 and Phase 1b clinical trials of NUC-3373 and the Phase 1 clinical trial of NUC-7738. While we continue to evaluate the impact of COVID-19 on our operations, we believe that this pandemic will inevitably cause some delays to the timing of initiation and completion of our clinical trials. The overall impact is currently unknown and we are continuing to monitor the COVID-19 pandemic as it evolves.

Financial Operations Overview

Revenues

We do not have any approved products. Accordingly, we have not generated any revenue, and we do not expect to generate any revenue from the sale of any products unless and until we obtain regulatory approvals for, and commercialize any of, our product candidates. In the future, we will seek to generate revenue primarily from product sales and, potentially, regional or global collaborations with strategic partners.

Operating Expenses

We classify our operating expenses into two categories: research and development expenses and administrative expenses. Personnel costs, including salaries, benefits, bonuses and share-based payment expense, comprise a component of each of these expense categories. We allocate expenses associated with personnel costs based on the function performed by the respective employees.

Research and Development Expenses

The largest component of our total operating expenses since our inception has been costs related to our research and development activities, including the preclinical and clinical development of our product candidates.

Research and development costs are expensed as incurred. Our research and development expense primarily consists of:

 

•

costs incurred under agreements with contract research organizations, or CROs, and investigative sites that conduct preclinical studies and clinical trials;

 

•

costs related to manufacturing active pharmaceutical ingredients and drug products for preclinical studies and clinical trials;

 

•

salaries and personnel-related costs, including bonuses, benefits and any share-based payment expense, for our personnel performing research and development activities or managing those activities that have been out-sourced;

 

•

fees paid to consultants and other third parties who support our product candidate development;

 

•

other costs incurred in seeking regulatory approval for our product candidates; and

 

•

payments under our license agreements.

The successful development of our ProTides is highly uncertain. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. Accordingly, we expect research and development costs to increase significantly for the foreseeable future as programs progress. However, we do not believe that it is possible at this time to accurately project total program-specific expenses through commercialization. We are also unable to predict when, if ever, material net cash inflows will commence from our product candidates to offset these expenses. Our expenditures on current and future preclinical and clinical development programs are subject to numerous uncertainties in timing and cost to completion.

The duration, costs and timing of clinical trials and development of our product candidates will depend on a variety of factors including:

 

•

the scope, rate of progress, results and expenses of our ongoing and future clinical trials, preclinical studies and research and development activities;

 

•

the potential need for additional clinical trials or preclinical studies requested by regulatory agencies;

 

•

potential uncertainties in clinical trial enrollment rates or drop-out or discontinuation rates of patients;

 

•

competition with other drug development companies in, and the related expense of, identifying and enrolling patients in our clinical trials and contracting with third-party manufacturers for the production of the drug product needed for our clinical trials;

 

•

the achievement of milestones requiring payments under in-licensing agreements;

 

•

any significant changes in government regulation;

 

•

the terms and timing of any regulatory approvals;

 

•

the expense of filing, prosecuting, defending and enforcing patent claims and other intellectual property rights; and

 

•

the ability to market, commercialize and achieve market acceptance for any of our product candidates, if approved.

We track research and development expenses on a program-by-program basis for both clinical-stage and preclinical product candidates. Manufacturing and non-clinical research and development expenses are assigned or allocated to individual product candidates, where appropriate.

Administrative Expenses

Administrative expenses consist of personnel costs, allocated expenses and other expenses for outside professional services, including legal, audit and accounting services. Personnel costs consist of salaries, bonuses, benefits and share-based payment expense. Other administrative expenses include office related costs, professional fees and costs of our information systems. We anticipate that our administrative expenses will continue to increase in the future as we increase our headcount to support our continued research and development and potential commercialization of our product candidates. We also incur expenses as a public company, including expenses related to compliance with the rules and regulations of the SEC and The Nasdaq Global Select Market, additional insurance expenses, and expenses related to investor relations activities and other administrative and professional services.

Net Foreign Exchange Gains (Losses)

Net foreign exchange gains (losses) primarily includes gains or losses on cash held in U.S. dollars and on dollar-denominated advances paid to suppliers.

Finance Income

Finance income relates to interest earned on our cash and cash equivalents.

Income Tax Credit

We are subject to corporate taxation in the United Kingdom and our wholly owned U.S. subsidiary, NuCana, Inc., is subject to corporate taxation in the United States. Due to the nature of our business, we have generated losses since inception in the United Kingdom. Our income tax credit recognized represents the sum of the research and development tax credits recoverable in the United Kingdom and in the United States, and income tax payable in the United States.

As a company that carries out extensive research and development activities, we benefit from the U.K. and U.S. research and development tax credit regimes. In the United Kingdom, we are able to surrender some of our losses for a cash rebate of up to 33.35% of eligible expenditures on qualifying research and development projects. In the United States, we are able to offset the research and development credits against corporation tax payable. Qualifying expenditures in the United Kingdom largely comprise clinical trial and manufacturing costs, employment costs for relevant staff and consumables incurred as part of research and development projects. In the United Kingdom, where we receive the larger proportion of the research and development credit, certain subcontracted qualifying research and development expenditures are eligible for a cash rebate of up to 21.68%. A large portion of costs relating to our research and development, clinical trials and manufacturing activities are eligible for inclusion within these tax credit cash rebate claims.

We may not be able to continue to claim research and development tax credits in the United Kingdom in the future under the current research and development tax credit scheme because we may no longer qualify as a small or medium-sized company, or SME. However, we may be able to file under a large company scheme.

Results of Operations

Comparison of the Three Months Ended June 30, 2020 and June 30, 2019

The following table summarizes the results of our operations for the three months ended June 30, 2020 and 2019.

 

		For the Three Months Ended June 30,
		2020				2019
		(unaudited)
		(in thousands)
		£				£
Research and development expenses			(5,863	)			(5,356	)
Administrative expenses			(1,629	)			(1,462	)
Net foreign exchange gains			84				943
Operating loss			(7,408	)			(5,875	)
Finance income			64				297
Loss before tax			(7,344	)			(5,578	)
Income tax credit			1,283				1,108
Loss for the period			(6,061	)			(4,470	)
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations			1				6
Total comprehensive loss for the period			(6,060	)			(4,464	)

Research and Development Expenses

Research and development expenses were £5.9 million for the three months ended June 30, 2020 as compared to £5.4 million for the three months ended June 30, 2019, an increase of £0.5 million. The increase resulted primarily from higher manufacturing costs, which increased by £0.8 million as compared to the three months ended June 30, 2019. This increase was partially offset by a reduction in non-clinical and travel costs of £0.3 million.

The following table gives a breakdown of the research and development costs incurred by product candidate for the three months ended June 30, 2020 and 2019:

 

		For the Three Months Ended June 30,
		2020				2019
		(in thousands)
		£				£
Acelarin			3,057				2,842
NUC-3373			1,155				1,268
NUC-7738			1,158				440
Other			493				806
			5,863				5,356

Administrative Expenses

Administrative expenses were £1.6 million for the three months ended June 30, 2020 as compared to £1.5 million for the three months ended June 30, 2019, an increase of £0.1 million. The increase was primarily related to higher personnel, share-based compensation and insurance costs, offset by lower professional fees and travel costs.

Net Foreign Exchange Gains

For the three months ended June 30, 2020, we reported a net foreign exchange gain of £0.1 million as compared to a net foreign exchange gain of £0.9 million for the three months ended June 30, 2019. In the three months ended June 30, 2019, the gain reflected the appreciation of the U.S. dollar relative to the U.K. pound sterling. In the three months ended June 30, 2020, the U.S. dollar relative to U.K. pound sterling remained broadly flat.

Finance Income

Finance income represents bank interest and was £0.1 million for the three months ended June 30, 2020 and £0.3 million for the three months ended June 30, 2019. The decrease in bank interest resulted from lower cash balances held on term deposits and lower rates of interest being earned on those deposits.

Income Tax Credit

The income tax credit for the three months ended June 30, 2020, which is largely composed of U.K. research and development tax credits, amounted to £1.3 million as compared to £1.1 million for the three months ended June 30, 2019. The increase in the income tax credit was primarily attributable to an increase in our eligible research and development expenses.

Results of Operations

Comparison of the Six Months Ended June 30, 2020 and June 30, 2019

The following table summarizes the results of our operations for the six months ended June 30, 2020 and 2019.

 

		For the Six Months Ended June 30,
		2020				2019
		(unaudited)
		(in thousands)
		£				£
Research and development expenses			(11,801	)			(9,706	)
Administrative expenses			(3,238	)			(2,808	)
Net foreign exchange gains (losses)			2,211				(37	)
Operating loss			(12,828	)			(12,551	)
Finance income			208				616
Loss before tax			(12,620	)			(11,935	)
Income tax credit			2,593				2,108
Loss for the period			(10,027	)			(9,827	)
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations			22				1
Total comprehensive loss for the period			(10,005	)			(9,826	)

Research and Development Expenses

Research and development expenses were £11.8 million for the six months ended June 30, 2020 as compared to £9.7 million for the six months ended June 30, 2019, reflecting an increase of £2.1 million. The increase resulted primarily from higher expenses incurred related to clinical trials of £5.3 million in the six months ended June 30, 2020, compared with £4.1 million in the six months ended June 30, 2019. Manufacturing costs were £1.8 million in the six months ended June 30, 2020 compared with £1.1 million for the six months ended June 30, 2019, representing an increase of £0.7 million. Non-clinical and patent costs decreased by £0.2 million for the six months ended June 30, 2020 as compared to the six months ended June 30, 2019. Other research and development costs increased in the six months ended June 30, 2020 by £0.4 million primarily due to higher personnel costs and share-based compensation expenses incurred during the period, partially offset by a reduction in travel costs.

The following table gives a breakdown of the research and development costs incurred by product candidate for the six months ended June 30, 2020 and 2019:

 

		For the Six Months Ended June 30,
		2020				2019
		(in thousands)
		£				£
Acelarin			6,333				4,988
NUC-3373			2,786				2,523
NUC-7738			1,822				773
Other			860				1,422
			11,801				9,706

Administrative Expenses

Administrative expenses were £3.2 million for the six months ended June 30, 2020 as compared to £2.8 million for the six months ended June 30, 2019, reflecting an increase of £0.4 million. The increase was primarily related to higher amortization and depreciation, personnel, insurance and share-based compensation expenses, partially offset by lower professional fees and travel costs.

Net Foreign Exchange Gains (Losses)

For the six months ended June 30, 2020, we reported a net foreign exchange gain of £2.2 million as compared to a net foreign exchange loss of £37,000 for the six months ended June 30, 2019. In the six months ended June 30, 2020, the gain reflected the appreciation of the U.S. dollar relative to the U.K. pound sterling. In the six months ended June 30, 2019, the U.S. dollar relative to U.K. pound sterling remained broadly flat.

Finance Income

Finance income represents bank interest and was £0.2 million for the six months ended June 30, 2020 and £0.6 million for the six months ended June 30, 2019. The decrease in bank interest resulted from lower cash balances held on term deposits and lower rates of interest being earned on those deposits.

Income Tax Credit

The income tax credit for the six months ended June 30, 2020, which is largely composed of U.K. research and development tax credits, amounted to £2.6 million as compared to £2.1 million for the six months ended June 30, 2019. The increase in the income tax credit was primarily attributable to an increase in our eligible research and development expenses.

Liquidity and Capital Resources

Overview

Since our inception, we have incurred significant operating losses and negative cash flows. We anticipate that we will continue to incur losses for at least the next several years. We expect that our research and development and administrative expenses will increase in connection with conducting clinical trials and seeking marketing approval for our product candidates, as well as costs associated with operating as a public company. As a result, we will need additional capital to fund our operations, which we may obtain from additional equity financings, debt financings, research funding, collaborations, contract and grant revenue or other sources.

As of June 30, 2020 and December 31, 2019, we had cash and cash equivalents of £47.8 million and £52.0 million, respectively. We do not currently have any approved products and have never generated any revenue from product sales. To date, we have financed our operations primarily through the issuances of our equity securities.

In October 2018, we entered into an “at-the-market” (ATM) sales agreement with Cowen and Company, LLC, or Cowen, pursuant to which we may sell from time to time, ADSs having an aggregate offering price of up to $100.0 million through Cowen, acting as our agent. Sales of our ADSs pursuant to this ATM program are subject to certain conditions specified in the sales agreement. Sales under the ATM program are registered on a shelf registration statement on Form F-3 that we filed with the SEC in October 2018, and which permits the offering, issuance and sale by us of up to a maximum aggregate offering price of $400.0 million of our securities, inclusive of our ADSs sold under the ATM program. During the three months and six months ended June 30, 2020, we sold and issued 428,305 ADSs, representing 428,305 ordinary shares, under the ATM program, raising gross proceeds of £2.0 million.

Cash Flows

Comparison of the Six Months Ended June 30, 2020 and June 30, 2019

The following table summarizes the results of our cash flows for the six months ended June 30, 2020 and 2019.

 

		For the Six Months Ended June 30,
		2020				2019
		(in thousands)
		£				£
Net cash used in operating activities			(7,647	)			(11,635	)
Net cash used in investing activities			(539	)			(133	)
Net cash from (used in) financing activities			1,795				(9	)
Net decrease in cash and cash equivalents			(6,391	)			(11,777	)

Operating Activities

The net cash used in operating activities was £7.6 million for the six months ended June 30, 2020 as compared to £11.6 million for the six months ended June 30, 2019, a net decrease in cash outflows of £4.0 million. The principal reason for this decrease was a tax refund of £4.2 million received in the six months ended June 30, 2020, whereas no similar cash inflow was recorded in the six months ended June 30, 2019. Operating loss cash flows were higher by £1.9 million for the six months ended June 30, 2020, reflecting primarily higher research and development costs. The increase in operating loss cash flows was offset by working capital inflows of £1.2 million in the six months ended June 30, 2020 as compared to working capital outflows of £0.6 million in the six months ended June 30, 2019.

Investing Activities

The net cash used in investing activities was £0.5 million for the six months ended June 30, 2020 as compared to £0.1 million for the six months ended June 30, 2019. Interest received for the six months ended June 30, 2020 was £0.3 million compared with £0.6 million for the six months ended June 30, 2019, a decrease of £0.3 million. In the six months ended June 30, 2020, cash used to acquire intangible assets was higher by £0.1 million than in the six months ended June 30, 2019.

Financing Activities

The net cash from financing activities was £1.8 million for the six months ended June 30, 2020 as compared to cash used in financing activities of £9,000 for the six months ended June 30, 2019. For the six months ended June 30, 2020, the Company generated net proceeds from the issue of share capital of £1.9 million, as compared to £0.1 million for the six months ended June 30, 2019.

Operating and Capital Expenditure Requirements

We have not achieved profitability on an annual basis since our inception, and we expect to incur net losses in the future. We expect that our operating expenses will increase as we continue to invest in our research and development programs, exploit our ProTide pipeline and build out our organization with additional employees.

We believe that our existing capital resources will be sufficient to fund our operations, including currently anticipated research and development activities and planned capital spending, at least into the fourth quarter of 2021.

Our future funding requirements will depend on many factors, including but not limited to:

 

•

the scope, rate of progress and cost of our clinical trials, preclinical programs and other related activities;

 

•

the extent of success in our early preclinical and clinical stage research programs, which will determine the amount of funding required to further the development of our product candidates;

 

•

the progress that we make in developing new product candidates based on our proprietary ProTide technology;

•

the cost of manufacturing clinical supplies and establishing commercial supplies of our product candidates and any products that we may develop;

 

•

the costs involved in filing and prosecuting patent applications and enforcing and defending potential patent claims;

 

•

the outcome, timing and cost of regulatory approvals of our ProTide product candidates;

 

•

the cost and timing of establishing sales, marketing and distribution capabilities;

 

•

the costs of hiring additional skilled employees to support our continued growth and the related costs of leasing additional office space; and

 

•

developments related to COVID-19 and its impact on the costs and timing associated with the conduct of our clinical trials, preclinical programs and other related activities.

Exhibit 99.3

NuCana Reports Second Quarter 2020 Financial Results and Provides Business Update

Edinburgh, United Kingdom, August 19, 2020 (GLOBE NEWSWIRE) – NuCana plc (NASDAQ: NCNA) announced financial results for the second quarter ended June 30, 2020 and provided an update on its broad clinical program with its transformative ProTide therapeutics.

As of June 30, 2020, NuCana had cash and cash equivalents of £47.8 million compared to £47.6 million as of March 31, 2020 and £52.0 million as of December 31, 2019. NuCana continues to advance its various clinical programs and reported a net loss of £6.1 million for the quarter ended June 30, 2020, as compared to £4.5 million for the quarter ended June 30, 2019. Basic and diluted loss per share was £0.19 for the quarter as compared to £0.14 per share for the prior-year quarter.

“We had a very productive second quarter despite the COVID-19 pandemic. While we placed a brief pause on the recruitment of new patients in April, we have since lifted that pause and our operations have experienced minimal disruption to date”, said Hugh S. Griffith, NuCana’s Founder and Chief Executive Officer. “We are driving recruitment in the ongoing global Phase III study of Acelarin plus cisplatin in patients with biliary tract cancer. We are also making good progress in the Phase Ib combination and Phase I monotherapy studies of NUC-3373 as well as the Phase I study of NUC-7738.”

Mr. Griffith continued: “We are also excited to have three posters accepted for presentation at the ESMO Virtual Congress 2020 to be held September 19-21, 2020. We look forward to presenting additional interim clinical data from the ongoing Phase Ib study of NUC-3373 in combination with other agents typically combined with 5-FU in patients with advanced colorectal cancer (NuTide:302). Additionally, we will present the first-ever clinical data from the ongoing Phase I study of NUC-7738 in patients with advanced solid tumors (NuTide:701). Finally, we will present a poster related to the ongoing NuTide:121 study of Acelarin plus cisplatin in patients with advanced biliary tract cancer.”

The poster titles are as follows:

 

•

Poster 464P - Pharmacokinetic analysis of NUC-3373 with and without leucovorin in patients with previously treated metastatic colorectal cancer (NuTide:302 study)

 

•

Poster 600TiP - A first-in-human study of, NUC-7738, a 3’-dA phosphoramidate, in patients with advanced solid tumors (NuTide:701)

 

•

Poster 80TiP - Global Phase 3 study of NUC-1031 plus cisplatin vs gemcitabine plus cisplatin for first-line treatment of patients with advanced biliary tract cancer (NuTide:121)

Mr. Griffith said: “We were also pleased to have presented data at the American Association for Cancer Research in June that suggested an additional immunomodulatory mode of action for Acelarin and NUC-3373. These data showed our ProTides’ potential to alter tumor biology and enhance the activity of immune checkpoint inhibitors. They also revealed new and exciting modes of action and help explain why our ProTides appear to be such potent anti-cancer agents.”

Mr. Griffith concluded: “As we continue to advance our novel ProTide pipeline, we remain fortunate to be in a strong financial position with our cash runway still expected to extend at least into the fourth quarter of 2021. We remain focused on advancing our novel ProTide pipeline to develop more effective and safer medicines for patients with cancer.”

Anticipated 2020 Milestones

 

•

Acelarin is a ProTide transformation of gemcitabine. In 2020, NuCana expects to:

 

•

Drive enrollment in the Phase III study of Acelarin combined with cisplatin as a first-line treatment for patients with advanced biliary tract cancer.

 

•

NUC-3373 is a ProTide transformation of the active anti-cancer metabolite of 5-FU. In 2020, NuCana expects to:

 

•

Report data from the ongoing Phase Ib study (NuTide:302) of NUC-3373 in patients with advanced colorectal cancer and establish the recommended Phase II dose of NUC-3373 in combination with other agents with which 5-FU is typically combined, such as leucovorin, oxaliplatin and irinotecan.

 

•

Contingent on regulatory guidance and other factors, initiate a Phase II/III study of NUC-3373 in combination with other agents for patients with colorectal cancer.

 

•

Report data from the ongoing Phase I study (NuTide:301) of NUC-3373 in patients with advanced solid tumors.

 

•

NUC-7738 is a ProTide transformation of a novel nucleoside analog, 3’-deoxyadenosine. In 2020, NuCana expects to:

 

•

Report data from the Phase I study (NuTide:701) of NUC-7738 in patients with advanced solid tumors.

About NuCana plc

NuCana is a clinical-stage biopharmaceutical company focused on significantly improving treatment outcomes for cancer patients by applying our ProTide technology to transform some of the most widely prescribed chemotherapy agents, nucleoside analogs, into more effective and safer medicines. While these conventional agents remain part of the standard of care for the treatment of many solid and hematological tumors, their efficacy is limited by cancer cell resistance mechanisms and they are often poorly tolerated. Utilizing our proprietary technology, we are developing new medicines, ProTides, designed to overcome key cancer resistance mechanisms and generate much higher concentrations of anti-cancer metabolites in cancer cells. NuCana’s robust pipeline includes three ProTides in clinical development. Acelarin and NUC-3373, are new chemical entities derived from the nucleoside analogs gemcitabine and 5-fluorouracil, respectively, two widely used chemotherapy agents. Acelarin is currently being evaluated in four clinical studies, including a Phase III study for patients with biliary tract cancer, a Phase Ib study for patients with biliary tract cancer, a Phase II study for patients with platinum-resistant ovarian cancer and a Phase III study for patients with metastatic pancreatic cancer for which enrollment has been suspended. NUC-3373 is currently in a Phase I study for the potential treatment of a wide range of advanced solid tumors and a Phase Ib study for patients with metastatic colorectal cancer. Our third ProTide, NUC-7738, is a transformation of a novel nucleoside analog (3’-deoxyadenosine) and is in a Phase I study for patients with advanced solid tumors.

Forward-Looking Statements

This press release may contain “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on the beliefs and assumptions and on information currently available to management of NuCana plc (the “Company”). All statements other than statements of historical fact contained in this press release are forward-looking statements, including statements concerning the amount and sufficiency of the Company’s current cash and cash equivalents to fund its planned operations at least into the fourth quarter of 2021; the Company’s planned and ongoing clinical studies for the Company’s product candidates and the potential advantages of those product candidates, including Acelarin, NUC-3373 and NUC-7738; the initiation, enrollment, timing, progress, release of data from and results of those planned and ongoing clinical studies; the impact of COVID-19 on its preclinical studies, clinical studies, business, financial condition and results of operations; the Company’s goals with respect to the development and potential use, if approved, of each of its product candidates; and the utility of prior non-clinical and clinical data in determining future clinical results. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other comparable terminology. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks and uncertainties include, but are not limited to, the risks and uncertainties set forth in the “Risk Factors” section of the Company’s Annual Report on Form 20-F for the year ended December 31, 2019 filed with the Securities and Exchange Commission (“SEC”) on March 10, 2020, and subsequent reports that the Company files with the SEC. Forward-looking statements represent the Company’s beliefs and assumptions only as of the date of this press release. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievements. Except as required by law, the Company assumes no obligation to publicly update any forward-looking statements for any reason after the date of this press release to conform any of the forward-looking statements to actual results or to changes in its expectations.