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Downing’s specialist VCT Healthcare Shareclass backs pioneering biotech company Destiny Pharma

5 September 2017

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Downing’s specialist VCT Healthcare Shareclass

Investment manager Downing LLP has invested £1.75 million in Destiny Pharma PLC, a clinical stage biotechnology company focused on developing revolutionary superbug treatments.

It is the first investment for Downing FOUR VCT – Healthcare Share Class, one of the UK’s specialist healthcare VCTs, backing a business that is targeting a significant opportunity in antibiotic-resistant pathogens, with a potentially faster route to market and improved patent protection in the US.

Downing’s investment comes as part of a successful £15.3 million funding round by Destiny Pharma that saw the company float on the Alternative Investment Market under the leadership of Chief Executive Officer Neil Clark (former CEO of CeNes and CFO of Ergomed that listed in 2014).

Destiny Pharma will primarily use the funds raised through its AIM float to progress development of its XF-73 drug through a Phase IIb clinical trial. The drug is aimed at preventing post-surgical Staphylococcus aureus infections (including MRSA), a market Destiny Pharma estimates to be worth a billion dollars in the US alone and growing. In 2013, the US Center for Disease Control & Prevention estimated that at least 2 million people every year become infected with bacteria that are resistant to antibiotics and at least 23,000 people die each year as a direct result of these infections..

Dr Kostas Manolis, Partner and Head of Unquoted Investments at Downing said:

“We are delighted to be investing in Destiny Pharma, backing a talented team that has built a strong patent portfolio of drugs targeting a real problem in hospitals around the world. This is the first investment for Downing FOUR VCT - Healthcare Share Class, alongside investors in the Generalist Share Class and our Downing Ventures EIS, who also participated in this round.”

Liz Klein, investment consultant to Downing’s specialist healthcare partner BioScience Managers Pty Ltd added:

“I believe the potential for new approaches to treat the threat from antibiotic pathogens will be critical to the future of healthcare systems. The opportunity to invest in this sub-sector through our relationship with Destiny Pharma was one we couldn’t pass up.”

Combining Downing’s expertise in supporting innovative venture and growth stage companies with BioScience Managers’ technical expertise and understanding of the healthcare investment landscape, Downing FOUR VCT – Healthcare Share Class is close to reaching its £10 million target fund raise and continues to actively seek more innovative companies in which to invest.




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Pamela Morris, the lang cat

0131 202 6037


Jean Birrell, Downing LLP




Issued by Downing LLP. Downing LLP is authorised and regulated by the Financial Conduct Authority in the UK (Firm Reference No. 545025). This has been prepared for retail investors and their advisers. This article is for information purposes, should not be regarded as investment or taxation advice and no reliance should be placed upon it. Any personal opinions expressed are subject to change and should not be interpreted as investment advice or a recommendation.

Capital is at risk. The value of investments and any income derived may go down as well as up and investors may not get back the full amount invested.




About the deal

The deal was led by Richard Lewis at Downing LLP, working in collaboration with Liz Klein of

BioScience Managers Pty Ltd.


About Destiny Pharma ()

Destiny Pharma is an established, clinical stage, innovative biotechnology company focused on the development of novel medicines that represent a new approach to the treatment of infectious disease. These potential new medicines are being developed to address the need for new drugs for the prevention and treatment of life-threatening infections caused by antibiotic resistant bacteria, often referred to as “superbugs”. Tackling anti-microbial resistance has become a global imperative recognised by the WHO and the United Nations, as well as the G7 and G20 countries. 

Destiny Pharma floated on AIM on 4 September 2017. On the same day it also announced a mutually beneficial regional framework development and commercialisation agreement with China Medical Systems Holdings Ltd that will see the two companies collaborate in China and certain other Asian companies (excluding Japan).

The Destiny Pharma management team comprises Neil Clarke (CEO), Simon Sacerdoti (CFO) and Bill Love (CSO and founder).



Please note, capital is at risk and returns are not guaranteed. There is no guarantee that the valuation of shares will fully reflect their underlying net asset value, or that you will be able to buy and sell at that valuation or at all. The key risks associated with Downing FOUR are listed below. Please refer to the Prospectus for a full list of risk factors.

·         Tax reliefs are not guaranteed: If Downing FOUR does not maintain VCT qualifying status investors could lose the upfront 30% income tax relief and all other tax reliefs.

·         Single sector exposure: The qualifying investments in this share class will only be invested in the healthcare sector, which may increase risks compared to a VCT share class that is diversified by sector.

·         There are market risks: The investments the Company will make in funds comprising listed stocks will be subject to normal market fluctuations and other risks inherent in investing in securities.

·         VCT rules are restrictive: Downing FOUR’s ability to obtain maximum value from its investments may be limited by the VCT rules. Changes in the VCT rules may be applied retrospectively and may reduce the level of returns for investors.

·         You cannot rely on past performance: Downing FOUR invests in small unlisted companies which, by their nature, are higher risk than larger “blue-chip” companies. Past performance is not a reliable indicator of future performance. 

·         This is a long-term investment: You should be prepared to hold your shares for a minimum of five years to qualify for the available VCT tax reliefs.

·         Nature of smaller companies: VCT funds must be invested in smaller companies which may be riskier than their larger counterparts and where shares may be less liquid.

·         You may lose money: the value of shares may go down as well as up and shareholders may not receive back the full amount invested. In addition, there is no certainty as to the level of dividends.


 US Center for Disease Control & Prevention  

Important Notice

Investing in our products will place your capital at risk and you may not get back the full amount invested. Any tax treatment may be subject to change and the availability and value of the reliefs depend on the individual circumstances of each investor. The availability of tax reliefs also depends on the investee companies maintaining their qualifying status.

Further information can be found at HMRC’s website. Neither past performance or forecasts are reliable indicators of future results and should not be relied upon. Unquoted or smaller company shares are likely to have higher price fluctuations and are likely to be more difficult to sell than shares quoted on the London Stock Exchange Official List. Website content is not intended to constitute investment, tax or legal advice. We recommend you seek independent advice before investing in any of our products.

Important Notice

Downing’s investments place your capital at risk and you may not get back the full amount invested. Past performance and forecasts are not a reliable guide to future results. Tax treatment may be subject to change and depends on individual circumstances. Smaller company shares are likely to have higher volatility and liquidity risks than other types of main market listed instruments. We recommend that you seek professional independent financial advice before investing. We do not offer investment or tax advice.

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