Futura Medical plc
Focused on the future
Annual Report and Accounts
2023
INTRODUCING
Our 2023 Annual Report
WELCOME TO THE FUTURA MEDICAL
ANNUAL REPORT
Futura Medical specialises in
the development and global
commercialisation of innovative and
proprietary sexual health products.
Our lead product is Eroxon®, a
clinically proven breakthrough
treatment for erectile dysfunction.
We are experts in the
research, development and
commercialisation of topically
delivered gel formulations.
Our purpose is to provide
a range of clinically proven
sexual health products that
enhance quality of life.
CONTENTS
STRATEGIC REPORT
Business at a glance
Investment case
Year at a glance
Chairman’s Statement
Chief Executive’s Review
Our marketplace
Eroxon® progress at a glance
Commercialisation process
Commercialisation at a glance
Spotlight on commercial partners
How Eroxon® has changed lives:
two real-life case studies
Our business model
Our strategy
Key performance indicators
Product Review – Eroxon®
Our strategy in action – European launch
Our strategy in action – US go-to-market
strategy
Financial Review
Stakeholder engagement
Key risks and mitigation
Sustainability Review
02
03
05
07
08
11
13
14
15
16
17
19
21
23
25
27
28
29
31
34
37
GOVERNANCE
Board of Directors
Corporate Governance Statement
Spotlight on our new Chairman
Our Governance Structure
Corporate Governance Report
Audit Committee Report
Remuneration Committee Report
Directors’ Report
FINANCIAL STATEMENTS
Independent Auditor’s Report to the
Members of Futura Medical plc
Consolidated Statement of
Comprehensive Loss
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial
Statements
Parent Company Balance Sheet
Parent Company Statement of Changes
in Equity
Notes to the Parent Company Financial
Statements
Company information
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91
Futura Medical plc Annual Report 2023 | 01
BUSINESS AT A GLANCE
Delivering clinically proven products to improve sexual health
Futura specialises in the development and global
commercialisation of innovative and proprietary sexual
health products. Our lead product is Eroxon®, a clinically
proven breakthrough treatment for erectile dysfunction
(“ED”). We are experts in the research, development and
commercialisation of topically delivered gel formulations
to improve sexual health. Our purpose is to provide a range
of clinically proven sexual health products that enhance
quality of life.
Futura Medical is based in Guildford, United Kingdom
(“UK”) and is listed on the AIM market of the London Stock
Exchange. We are an agile, driven and committed team
with extensive experience in the research, development
and commercialisation of consumer health products
globally with a particular expertise in Europe and the
United States of America (“USA”).
Futura’s business model focuses on a de-risked go-to-
market strategy via leading consumer healthcare partners
who are well resourced to commit significant marketing
spend and expertise. Futura has distribution partners
in place for Eroxon® in a number of major consumer
markets including Haleon plc (“Haleon”) in the USA, the
largest consumer health market in the world, and Cooper
Consumer Health in Europe.
Eroxon®, Futura's clinically proven lead product, has been
developed for the treatment of ED. Eroxon® is approved in
a number of markets across the world including in Europe
and the USA. Eroxon® launched in its first markets the UK
and Belgium in March 2023, being available to consumers
for the first time and changing the lives of men with ED
and their partners. Launches in the UK and Belgium were
followed by “soft-launches” in other European countries
and by the first launch in the Middle East in 2023 with
further launches in both regions taking place in 2024.
The highly differentiated product, which is the only topical
gel treatment for ED available over-the-counter (“OTC”)
and helps men get an erection in ten minutes, addresses
significant unmet needs in the ED market.
EROXON® IS THE ANSWER:
• It is the first OTC topical gel clinically proven for the
treatment of ED
• It is the only topical gel treatment for ED available
without the need of a doctor’s prescription
• It helps men get an erection in ten minutes, addressing
significant unmet needs in the ED market.
Read more about our
Strategy on page 21
Read more about our
Marketplace on page 11
Read about our
commercial partners
on page 16
Read about Eroxon®
on page 25
20%
50%
25%
ED impacts around 20% of men
globally across all age brackets1
Approximately half of all men over
40 experience ED2
Around 25% of new diagnoses are
in men under 403
1 EMA, Withdrawal assessment report for Viagra, 2008
2 Feldman HA et al. J Urol 1994; 151: 54 – 61
3 Pozzi, J of Sexual Medicine, Volume 20, 2022
Futura Medical plc Annual Report 2023 | 02
INVESTMENT CASE
We utilise our expertise to deliver long-term shareholder value
HIGH BARRIERS TO ENTRY
INNOVATIVE AND EXPERIENCED TEAM
LARGE, GROWING AND UNDERSERVED
ADDRESSABLE MARKET
ED impacts around 20% of men globally across
all adult age brackets1, with approximately 50%
of all men over 40 experiencing ED2 and around
25% of all new diagnoses being in men under 403.
Over-the-counter (“OTC”) availability, longer lasting,
faster acting and affordability are the top unmet
needs for ED treatments4.
Futura has already taken first mover advantage
with regulatory approvals in key markets such
as the USA and European Union (“EU”) as well
as having distribution agreements in place with
leading consumer healthcare partners. In addition,
the Company has patents granted or pending in
over 30 countries including all the key ED markets.
Read more about the ED
market on page 11
View our regulatory approvals
and licensing deals on page 15
Futura has an innovative and experienced Research
and Development (“R&D”) team in place to broaden
the Eroxon® range and develop range extension
products.
Futura has gained unique knowledge and expertise
in the new and underserved OTC sexual health
category and therefore has the capability to build
upon market research already undertaken to
identify product extensions and potentially new
market segments for OTC products.
Read more about our Board
of Directors on page 39
1 EMA, Withdrawal assessment report for Viagra, 2008
2 Feldman HA et al. J Urol 1994; 151: 54 – 61
3 Pozzi, J of Sexual Medicine, Volume 20, 2022
4
Ipsos research carried out on behalf of Futura in the USA, 2022
Futura Medical plc Annual Report 2023 | 03
INVESTMENT CASE
SIGNIFICANTLY DIFFERENTIATED
LEAD PRODUCT
Our lead clinically proven product Eroxon® is
significantly differentiated against its peers, being
OTC and quicker to work.
Eroxon® is the only topical gel treatment for ED
available over the counter and helps men get an
erection in ten minutes. Being OTC significantly
improves access for men or their partners without
the normal cost or embarrassment, issues often
associated with consultation of a healthcare
practitioner. According to IPSOS research,
users who are dissatisfied with their current
medication mostly cite limited efficacy, slow onset
of action, and side effects as the source of their
dissatisfaction4.
DE-RISKED GO-TO-MARKET STRATEGY
AT AN INFLECTION POINT
Significant low-cost opportunity to broaden
the availability of Eroxon® rapidly and efficiently
worldwide through de-risked go-to-market strategy
via leading consumer healthcare partners who are
well resourced to commit significant marketing
spend and expertise.
Futura has distribution partners in place in a
number of major consumer markets including
Haleon in the USA, the largest consumer healthcare
market in the world, and Cooper Consumer Health
in Europe. These partners manage the marketing
and distribution of the product, investing their own
significant capital to market Eroxon® and broaden
its availability rapidly and efficiently.
The Company is at an inflection point following
recent commercialisation with first meaningful
revenues generated. Strong cash balance and
capital light corporate structure provide sufficient
funding for the growth strategy.
The first meaningful revenues generated from
product sales and the broader success of the
UK launch have been a catalyst for significant
strategic progress across multiple markets. With
the nature of the model, partnering with leading
consumer healthcare partners, there is low capital
commitment needed from Futura to significantly
broaden the reach of Eroxon® and deliver on the
Company’s growth strategy.
Read more about
Eroxon® on page 25
Read more about our
business model on page 19
Read more in our Financial
Review on page 29
Futura Medical plc Annual Report 2023 | 04
YEAR AT A GLANCE
A transformational year for the Group
2023 has been a year of huge progress across the business with key milestones being achieved
towards the commercialisation of Eroxon®, particularly in Europe and the USA.
OPERATIONAL HIGHLIGHTS
FINANCIAL HIGHLIGHTS
Significant progress has been made in key target markets
• Food and Drug Administration (“FDA”) marketing authorisation for Eroxon® in
the USA, the largest consumer healthcare market in the world
• Haleon plc secured as distribution partner for the USA and US$ 4 million
upfront payment received which will be recognised in FY24
• Successful UK and Belgium launches in March 2023 through Cooper
Consumer Health (“Cooper”)
• Granted allowance of EU patent which will provide protection for Eroxon® until
2040 in all key European markets
• Approvals received in a number of new markets, including Saudi Arabia,
Mexico and Australia, as well as launching in the United Arab Emirates (“UAE”)
Proven demand for Eroxon® – early data shows c. 20% market share in the UK
and Belgium
• The Company delivered first meaningful revenues of £3.1 million (2022: £nil)
following the launch of Eroxon®
• Gross profit of £1.8 million (2022: £nil) reflecting a gross margin of 57%
• Adjusted operating loss of £4.2 million*
• Loss after tax of £6.51 million (2022: £5.85 million)
• Strong cash position of £7.7 million (2022: £4.0 million), supported by the
Company’s efficient operating model and tight cost controls
POST PERIOD END
Extension of licensing agreement with Cooper to 2029
Eroxon® available on prescription in England and Wales, improving availability
and raising awareness
Presentation at ESSM
Congress
Eroxon® granted US
FDA approval for
OTC sale
Regulatory approval
granted in Saudi Arabia
and Australia
First launch in the
Middle East
Eroxon® awarded “New
product of the year”
by Boots
Eroxon® approved on
the NHS Drug Tariff
FEB 2023
JUN 2023
AUG 2023
OCT 2023
NOV 2023
DEC 2023
Key
Regulatory approvals
MAR 2023
JUL 2023
OCT 2023
OCT 2023
NOV 2023
Product launches
Licensing deals
Other
Launch in the UK and
Belgium
Commercialisation
agreement with
Haleon for the USA
European patent
granted for Eroxon®
Marketing
authorisation granted
in Mexico
M8 Pharmaceuticals
partnership expanded
* Adjusted for a non-cash share-based payment charge of £2.72 million (2022: £0.67 million). The share-based payment charge predominantly relates to the Long Term Incentive Plan (“LTIP”) award in
October 2023.
Futura Medical plc Annual Report 2023 | 05
Strategic
Report
STRATEGIC REPORT
Chairman’s Statement
Chief Executive’s Review
Our marketplace
Eroxon® progress at a glance
Commercialisation process
Commercialisation at a glance
Spotlight on commercial partners
How Eroxon® has changed lives:
two real-life case studies
Our business model
Our strategy
Key performance indicators
Product Review – Eroxon®
Our strategy in action – European launch
Our strategy in action – US go-to-market
strategy
Financial Review
Stakeholder engagement
Key risks and mitigation
Sustainability Review
07
08
11
13
14
15
16
17
19
21
23
25
27
28
29
31
34
37
Futura Medical plc Annual Report 2023 | 06
CHAIRMAN’S STATEMENT
We have built a solid foundation from which to seize our clear
opportunity for growth
It gives me great pleasure to present my first set of results
as the Chairman of Futura. 2023 was a momentous year
for Futura, with the Group successfully commercialising
and generating its first meaningful revenues from sales of
its lead product, Eroxon®, delivering on the objectives we
set out at the beginning of the period. This achievement
cannot be overstated, and my thanks go to the wider team
for all of their efforts this year, which are beginning to bear
fruit as we enter the next, exciting phase of Futura’s journey.
Since taking over the role of Chairman from John Clarke
in July and while serving on the Board as a Non-Executive
Director before this, I have seen how tirelessly the team
has worked to make such excellent progress. I would like
to thank John again, for all his contributions and guidance
which left the Company well positioned for its next phases
of growth. I undertook my role as Chairman with great
excitement as we are on the cusp of huge commercial
potential having a unique product already approved in the
two key erectile dysfunction (ED) markets of the USA and
Europe.
The market opportunity for Eroxon® is large and
there are three crucial factors that give me great
confidence that Eroxon® will establish itself as a
leading brand in the markets in which it is launched.
Firstly, it is the first pure OTC brand on the shelf
that will be accessible to consumers without a
prescription or the need for interaction with a
pharmacist during the purchasing process. This
“open accessibility” for the consumer is critical to
creating a large market for the brand. Secondly,
Eroxon®’s fast onset of action, with its key brand
claim of “helps you get an erection within 10
minutes”, is a major product advantage over the
traditional oral ED drugs that typically take 30 to 60
minutes to have an effect. And, thirdly, Futura has
been successful in entering into agreements with
market leading commercial partners that possess
deep expertise in executing and managing
successful consumer brand launches. We are
excited that we have the building blocks in place
to realise success in our key markets.
In the year, we have seen the successful rollout of Eroxon®
in the UK and Belgium, FDA marketing authorisation
in the USA and the subsequent licensing agreement
with Haleon, as well as further agreements made with
our distributors across our other markets. The Board’s
priority now is to build on this and ensure the successful
commercialisation of Eroxon® around the world, especially
in the USA, the largest consumer healthcare market in the
world. This, coupled with the delivery of recurring revenues
and profits is what the whole business is working towards
and is energised to achieve.
We were delighted to welcome Roy Davis to the Board
in January 2024, further strengthening our ability to
deliver on our strategy. With a wealth of experience in
the commercialisation of medical device development
companies and a proven track record of successfully
scaling businesses and delivering substantial shareholder
value, Roy’s expertise will be invaluable moving forward.
Alongside the commercialisation of Eroxon®, we remain
focused on the evolution and development of innovative
sexual health products. We have a small but highly
experienced R&D team, who have delivered a world first
product in Eroxon®. We are proud of our R&D heritage and
are already exploring where next to apply this resource, in
a cost-efficient way, as we seek to develop further clinically
proven sexual health products in the medium to long term.
Looking to the year ahead, we are excited to continue to
build on the progress made this year. With a clearly laid
out strategy, motivated team, solid foundations to build on
and exciting partnerships in place, we are confident in the
long-term prospects of the Group.
By order of the Board
JEFF NEEDHAM
Non-Executive Chairman
Futura Medical plc
9 April 2024
Futura Medical plc Annual Report 2023 | 07
“2023 was a momentous
year for Futura, with
the Group successfully
commercialising and
generating its first
meaningful revenues
from sales of its lead
product, Eroxon®.”
JEFF NEEDHAM
Non-Executive Chairman
CHIEF EXECUTIVE'S REVIEW
2023 – Delivering against our strategic objectives
I am very proud to be able to report the progress we
achieved in 2023. The year marks a pivotal moment for
Futura having delivered our first meaningful revenues from
our lead product, Eroxon®. To be able to walk into the UK’s
leading pharmacy and health and beauty retailers across
the country and see our product on the shelves in over
2,500 stores is truly momentous, but just the start.
We delivered on the three key objectives that we set out
in 2023: achieving marketing authorisation in the USA;
securing a standout US distribution partner in Haleon plc
for the largest consumer healthcare market in the world
and reporting our first meaningful revenues.
Erectile dysfunction (“ED”) should not be underestimated.
Globally it impacts approximately 20% of men1, affecting
all age ranges, with approximately 50% of men over 40
experiencing ED2 and around 25% of new diagnoses
being in men under 403. Moreover, with a globally ageing
population, this is a large market that is expected
to continue to grow. Research shows this is
an underserved market with the majority
of those affected yet to be diagnosed,
whilst within the cohort that have been
diagnosed, there is a high proportion
that are not on treatment or stop
treatment after one year. Our market
research shows limited efficacy, slow
onset of action, side effects and
costs as the main sources of their
dissatisfaction4.
Our lead product, Eroxon®, addresses
many of these needs. Clinically
proven, it is the only topical gel
treatment for ED available over the
counter (“OTC”) and helps men
get an erection in ten minutes.
Cost and embarrassment
can be a blocker to seeking a
solution to ED, particularly in
many parts of the world where
erectile dysfunction still holds a
significant stigma within society.
Eroxon®, being a clinically proven treatment available
without the need of consulting with a doctor, reducing the
need for consultation fees, significantly improves ease of
access for men and their partners.
Following the launch of Eroxon® in the UK and Belgium,
we generated revenue of £3.1 million from product sales
in 2023. As noted in our trading update in February, this
performance was then followed by a strong start to 2024,
as orders in excess of £0.5 million placed with our UK
manufacturer for contractual delivery in December 2023
were delivered late in early January 2024. The Company
delivered a gross margin of approximately 57% and ended
the period with a cash position of £7.7 million, providing a
solid foundation for Futura as it enters 2024.
We continue to build on a leading position in the
development of a topical gel treatment for ED, with high
barriers to entry and first mover advantage. Our leading
position is the result of the significant resources we have
invested into R&D and a lot of hard work, and I would like
to extend my thanks to our dedicated and loyal team for
their unwavering commitment and support of the business
which has now started to come to fruition.
STRATEGY UPDATE
In our 2022 Annual Report we set out five priorities for the
year ahead, below we cover the progress we have made
during 2023 against these priorities.
1. Marketing authorisation of Eroxon® by the US FDA as
an OTC De Novo medical device in Q2 2023.
In June 2023, Eroxon® received FDA marketing
authorisation in the USA, the largest consumer healthcare
market in the world. Eroxon® is the first OTC topical gel
available to treat ED in the USA, a huge breakthrough for
Futura and a significant milestone on our journey. The FDA
sets a very high standard in evaluating the effectiveness
and safety of De Novo Medical Devices and I am therefore
delighted that we met this standard with our submission
of 22 clinical, biocompatibility, human factor studies and
performance bench tests which were rigorously reviewed
and accepted by the FDA.
Futura Medical plc Annual Report 2023 | 08
“We delivered on the
three key objectives
that we set out in 2023:
achieving marketing
authorisation in
the USA; securing a
standout US distribution
partner in Haleon plc
and reporting our first
meaningful revenues.”
JAMES BARDER
Chief Executive
CHIEF EXECUTIVE'S REVIEW
2. First launches of Eroxon® in Europe and first
revenues reported, with further launches planned in
2024.
Our European distribution partner, Cooper, launched in
the UK and Belgium in March, followed in July with soft
launches, providing initial online-only availability without
advertising or promotional spend in France, Italy and
Spain. The results of the launches in these initial markets
have been encouraging, with Eroxon® taking c. 20% market
share of approved ED treatments in the UK and Belgium
within 12 months of launch, very strong media interest in
the launch, early signs of repeat purchase from customers,
and Eroxon® receiving several industry awards.
The success of the partnership with Cooper to date
was demonstrated through the recent extension of
the licensing agreement until January 2029, with full
launches in at least ten countries including key European
markets such as France, Italy and Spain already occurred
or expected during the first half of 2024. The granting
of Futura's EU patent for Eroxon® until 2040 further
cements the intellectual property of the product as Cooper
continues the roll out.
3. Sign further agreements for key markets and
countries worldwide – with the USA being the main
focus – to build a strong global network of licensing
and distribution partners and a strong brand identity
for Eroxon®.
Following FDA marketing authorisation in the USA, we
were delighted to secure agreement with Haleon, one of
the world’s leading consumer healthcare companies, for
exclusive marketing and distribution rights in the USA.
As part of the agreement, Haleon will commercialise
Eroxon® in the USA as the first and only clinically proven
gel treatment for ED, available OTC without a prescription.
The USA is the biggest consumer healthcare market
globally. Haleon will be responsible for all advertising and
promotional activities related to the launch and marketing
of the product in the USA. We believe Haleon, with its
strong capabilities in brand-building and marketing
through an unrivalled breadth of channels, as well as its
connections and market reach, makes the ideal partner
to introduce Eroxon® to the millions of men with ED in
the USA. We continue to work closely with Haleon on the
preparation for the launch which is progressing well and
will update shareholders on timings as appropriate.
Post-period end, we announced that Eroxon®, with effect
from 1 March 2024, is available to be prescribed by doctors
in England and Wales for the treatment of ED as well as
the existing OTC availability of Eroxon®. The purpose is to
increase the awareness and credibility of Eroxon® amongst
healthcare professionals.
5. Expand our supply chain and manufacturing
capabilities to increase supply chain robustness and
capacity.
As we start to supply Eroxon® to our distributors around
the globe it is essential that we have a robust supply chain
in place to provide greater supply certainty, as well as
additional capacity based on both Futura and distribution
partners’ sales projections moving forwards. To this end,
we have developed strategic partnerships with two new
contract manufacturers (“CMO”), one located in the
During the year, we also further strengthened our
relationship with our distribution partner for Central
and South America, M8 Pharmaceuticals Inc (“M8”), by
expanding our current agreement for Brazil and Mexico to
include a further fourteen countries covering the Central
and South American region. M8 is an excellent partner
with dedicated brand-building and marketing experience,
as well as a strong and reputable consumer healthcare
presence in South and Central America.
In conjunction with our advisers, we continually look to
strengthen our Intellectual Property portfolio whenever
possible and have recently filed three new patent
applications in relation to Eroxon®. These are new
submissions in addition to the patent that the EU granted
allowance in September 2023 and we expect to receive
further patent approval across other key ED markets
during 2024 and beyond providing protection for Eroxon®
until 2040.
4. Continue to support our commercial partners in their
own submissions to local regulatory bodies and in their
launch preparations.
Alongside our distribution partner for the Middle East,
Labatec Pharma, Eroxon® has been granted regulatory
approval in six Middle Eastern countries, including the
Kingdom of Saudi Arabia and the United Arab Emirates.
In addition, the Mexican Secretariat of Health granted OTC
sale marketing authorisation for Eroxon® in Mexico.
We also continue to make submissions in those countries
where we currently do not have distributors but where the
existing EU MDR approval is evidence of conformity of local
national requirements thereby simplifying the regulatory
approval procedure. Australia being one of such countries
where in 2023 we received approval for Eroxon®.
Futura Medical plc Annual Report 2023 | 09
CHIEF EXECUTIVE'S REVIEW
USA and the other in the EU to supply product to our
commercial partners. These supply chain partners will
be central to the long-term success of the product, and
we are working closely with them to deliver continuity of
supply, with a product of high quality at the lowest cost
possible.
FUTURE STRATEGY
2023 has seen us move from a pre-revenue R&D company
to a business with first meaningful revenues being
generated from commercial sales of Eroxon®. This is a
significant step forward and therefore it feels appropriate
to refine our strategy as follows:
To commercialise innovative and clinically proven
products for the OTC sexual health market. We will
partner with leading consumer healthcare partners
who are well resourced to commit significant marketing
spend and expertise to engage effectively with
consumers.
This approach is aligned with the demographic changes
of ageing populations, increasing prosperity and the
expectation of people to lead a full and active life no
matter their age.
We have a fantastic springboard from which to deliver our
de-risked, go-to-market strategy, and we have confidence
that we have found the best distribution partners for our
product.
With an innovative R&D team, we will look to fulfil the
needs of the large, underserved OTC sexual health market.
Going forwards, we will report against three strategic
pillars:
1. Address the growing needs within the OTC sexual
health market
2. Broaden the Company’s clinically proven product range
leveraging its innovative and experienced R&D capability
whilst being mindful of costs and focusing on return on
investment (“ROI”)
3. Commit to delivering strong returns for shareholders,
sustained profitability and financial discipline
Our priorities for 2024 are:
• Address – Address worldwide demand for Eroxon®
through strengthening our supply chain and
commercial network whilst achieving further regulatory
approvals and further launches across the world
• Broaden – Explore other range extensions as well as new
innovative products within the sexual health category to
meet further unmet demand, supported by clinical data
whilst remaining mindful of costs
• Commit – Deliver further revenue growth and progress
on the path towards profitability in the next 12 months
FOCUS FOR FY24 AND OUTLOOK
2023 was a year of significant achievement and I expect
2024 to be a year of precise execution primarily with the
further commercialisation of Eroxon®. The first meaningful
revenues generated from product sales and the broader
success of the UK launch have been a catalyst for
significant strategic progress across multiple markets and
we expect this to continue.
As stated previously, we continue to work with Haleon
on preparations for the US launch and look forward to
updating shareholders in due course.
Futura has already taken first mover advantage with
regulatory approvals and distribution agreements in
place with leading consumer healthcare partners for
Eroxon® in key markets such as the USA and EU. With the
size of the target market and the continuous progress
we are making, we look forward to the year ahead with
confidence.
By order of the Board
JAMES BARDER
Chief Executive Officer
Futura Medical plc
9 April 2024
1 EMA, Withdrawal assessment report for Viagra, 2008
2 Feldman HA et al. J Urol 1994; 151: 54 – 61
3 Pozzi, J of Sexual Medicine, Volume 20, 2022
4
Ipsos research carried out on behalf of Futura in the USA, 2022
Futura Medical plc Annual Report 2023 | 10
OUR MARKETPLACE
A large and growing addressable market
THE SEXUAL HEALTH MARKET
The sexual health market comprises of treatments
for sexual dysfunction in men and women and of the
global market for sexual wellness. The global sexual
dysfunction market we estimate is worth around
US$ 6.6 billion when combining the market value of
treatments for male and female sexual dysfunction1.
The sexual wellness market is worth US$ 11 billion2.
Our focus is on the development of innovative and
clinically proven sexual health products, with our lead
product being Eroxon®, a breakthrough treatment for
erectile dysfunction.
THE UNMET NEEDS IN THE
ERECTILE DYSFUNCTION MARKET
MARKET OPPORTUNITY
FOR EROXON®
The rising affordability of phosphodiesterase-5 inhibitors
(“PDE5is”) following the availability of generic versions has
led to significant increases in volumes with the number of
doses sold globally increasing by over 80% between 2018
and 20233. For the vast majority of markets, treatments
for ED are only available on prescription which creates a
significant opportunity for a new category OTC.
Prior to Eroxon®, existing treatments for ED were available
only on prescription in most countries around the world,
creating barriers to access4. Embarrassment, denial,
reticence, cost of a consultation and lack of awareness
may prevent someone seeking the help of a doctor. Men
with ED whose sexual partners wish to be supportive and
solutions-oriented are doubly hindered by these factors as
only the sufferer can be prescribed the treatment. On-
demand oral treatments such as sildenafil (brand name
“Viagra®”) typically take between 30 minutes to one hour to
work, requiring planning and patience, which stand in the
way of intimacy and spontaneity, and put undue pressure
on couples. Oral treatments can also have systemic side
effects and cannot be taken in combination with several
medications.
According to IPSOS research5:
• Users who are dissatisfied with their current medication
mostly cite limited efficacy, slow onset of action, and side
effects as the source of their dissatisfaction
• OTC availability, longer lasting, affordability and faster
acting are identified as the top unmet needs for ED.
3.5 billion
50%
Doses of Rx ED
treatments sold
globally in 20233
Approximately half of
all men with ED do not
discuss their condition
with their doctor6
Eroxon® addresses many of the unmet needs for
men with ED and their partners. Ipsos’ research5
showed that around three quarters of the sales
would come from men with ED and their partners
who are not currently on treatment, which means
sales would be mainly incremental to existing sales
of oral PDE5is which appears to have been reflected
in the experience in market to date. According to
Ipsos’ forecast, commissioned by Futura in 2022,
the market opportunity for Eroxon® OTC in the USA,
the largest consumer healthcare market in the
world, is US$ 350+ million as estimated by Ipsos (at
retail price). This is based on the assumption of a
retail price of US$ 5 per tube7.
20%
ED impacts around 20%
of men globally across all
age brackets8
50%
Approximately half
of all men over 40
experience ED9
25%
Around 25% of new
diagnoses are in men
under 4010
Futura Medical plc Annual Report 2023 | 11
OUR MARKETPLACE
ED MARKET DRIVERS
Market driver
Impact
Long-term market drivers in consumer health in general
and ED specifically indicate a shift towards more self-care
with consumers taking a more active role in their health,
ageing populations, increases in chronic conditions,
changing socio-cultural context and the rising cost of
healthcare putting pressure on health systems.
Ageing populations
The proportion of people aged 65 years and over is expected
to increase from 9.3% of the global population in 2020 to
16%, or approximately one in six people globally, in 205011. The
incidence of ED increases with age which means a higher
proportion of the population with ED.
Increases in chronic
medical conditions
More people are being diagnosed and at a younger age with
conditions such as cardiovascular disease, obesity and diabetes
which increases the likelihood of having ED.
Socio-cultural context
Increasing pressures on
health systems
Younger men suffer increasingly from performance anxiety
due to societal pressures and unrealistic portrayals of sexual
performance in online pornography, as well as increasing
general stress and mental health issues. ED is increasingly
affecting younger men with around 25% of new diagnoses for
ED in men under 4010.
Healthcare systems have recently been under great pressure.
Sexual health conditions such as ED can be perceived as a
“quality of life” issue by doctors and not seen as a priority. OTC
products provide affordable and accessible treatment options
for consumers and lower the overall costs to health systems.
How we are
responding
Our strategy is built
around addressing
these key drivers. It aims
to meet the growing
demand for self-
care in sexual health
and recognises the
opportunity to serve
the unmet needs of
consumers in sexual
health and with Eroxon®
in ED where barriers
to access treatment
remain high.
We do this by offering
clinically proven
treatments to improve
sexual health OTC,
without the need for a
prescription.
Read more about
Eroxon® on page 25
1 Based on the following: ED market worth US$ 3.1 billion, IQVIA data 2022; Premature ejaculation market worth US$ 3.15 billion, 2022,
Business Research Insights, “Premature Ejaculation Treatment market size, etc….”, 2023; Female sexual dysfunction treatment market worth
US$ 0.4 billion, xResearch “Female Sexual Dysfunction Treatment market 2024”.
2 DataBridge market research “Global Sexual Wellness Market”, 2023.
3 Manufacturer’s Selling Prices, IQVIA market data, 2023
4
In the UK, Ireland, Norway, Poland, New Zealand, and Switzerland, sildenafil 50mg can be purchased without prescription but still requires
the involvement of the pharmacist. Cialis 10mg has recently switched OTC in the UK and also requires involvement of the pharmacist.
Ipsos research carried out on behalf of Futura in the USA, 2022
5
6 Jannini et al – Health-related characteristics and unmet needs of men with erectile dysfunction: a survey in five European countries, J Sex
Med, 2014 Jan.
7 Pricing strategy is the responsibility of our commercial partner.
8 EMA, Withdrawal assessment report for Viagra, 2008
9 Feldman HA et al. J Urol 1994; 151: 54 – 61
10 Pozzi, J of Sexual Medicine, Volume 20, 2022
11 UN Population Facts, October 2020
Futura Medical plc Annual Report 2023 | 12
EROXON® PROGRESS AT A GLANCE
Progress across the world in making Eroxon® accessible to men with ED
Futura’s lead product is Eroxon®, a unique topical treatment for erectile dysfunction which has been
approved without the need for a prescription in many countries around the world, including in the USA and
Europe and which has launched in a number of countries in Europe including the UK.
Development
Regulatory
Commercial partners
Launch
EU
USA
Eroxon® approved as a medical device
in the EU (“CE mark approval”).
Cooper Consumer Health
UKCA mark approval received in 2022.
Launched in the UK and Belgium in
March 2023 with further launches in
France, Spain, Portugal and other EU
countries in March and April 2024.
Marketing authorisation granted by
the FDA in June 2023.
Licensing deal signed with Haleon in
July 2023.
REST OF
WORLD
MIDDLE EAST
Approval received in six countries.
Further regulatory submissions have
been made.
Labatec Pharma
Launched in the UAE and in the
Kingdom of Saudi Arabia
LATAM
ASIA
Marketing authorisation granted in
Mexico.
M8 Pharmaceuticals
Discussions being held with
regulators to clarify regulatory
pathways and scope of
additional work.
Menarini KR (South Korea)
AUSTRALIA
Marketing authorisation granted in
Australia.
Futura Medical plc Annual Report 2023 | 13
COMMERCIALISATION PROCESS
Our go-to-market process step-by-step
Once a product has completed the main development phase and before it can be on the shelf available to consumers, a number of key activities need to be
undertaken in relation to: gaining regulatory approval, finding licensing partners, setting up the supply chain, and developing and implementing retail and
launch plans. These activities do not always take place in the order below and some can also occur in parallel but this visual is intended to show the process that
needs to be undertaken to commercialise the product and highlight the many key activities that need to have been completed to ensure a successful launch.
Regulatory
Approval
Licensing
Partner
Supply
Chain
Market
Engagement
Retail and
Launch Plans
• Engage with local
regulatory authorities to
understand and address
all data requirements
to obtain regulatory
approval
• This can include:
• Clinical trials
• Non-clinical studies
• Technical
investigations
• Preparation and
submission of product
dossier
• Resolution of
deficiencies raised by
local regulatory authority
• Search for licensing
partner and sign deal
• Key licensee criteria:
• Regulatory expertise
and capabilities
• Financial resources
and commitment
• Strong on-line and
off-line marketing and
sales capability
• Understanding of local
ED market dynamics
• Robust sales forecast
and business plan
• Ongoing support of
partners across all
functions and close
collaboration
Key Activities
• Search for contract
manufacturing
organisations
• Assessment of capability,
equipment and line
capacity
• Establish supply chain
• Quality control
• Clearance of all export
protocols
• Tech transfer from
Futura
• Local approval of all
packaging materials
• Approval and audit of
factory by Futura
• Registration of
new factory with
launch market
L
A
U
N
C
H
• Local market research to
optimise the positioning,
pricing and advertising
strategy
• Identify and educate Key
Opinion Leaders (“KOLs”)
• Presentations,
publications and
conferences to drive
healthcare professionals
(“HCPs”) education and
awareness
• Preparation and
translation of all
marketing materials
• Ensure compliance of
marketing materials
with local regulatory and
advertising framework
• Negotiation and
agreement with key
online and offline
retailers – most retail
stores only review
their product range
once a year
• Alignment with key
retailers on launch date
and promotional activity
• Clearance of local
trademarks and
other intellectual
property (“IP”)
• Preparation for PR
campaign
• Booking of advertising
slots ahead of launch
Futura Medical plc Annual Report 2023 | 14
COMMERCIALISATION AT A GLANCE
The global expansion of Eroxon® and our partnerships
This map is interactive and shows the countries in which Eroxon® has
received regulatory approvals, the countries where we have a licensing
partner and the countries where Eroxon® has been launched.
Click on the tabs on the right to select one of these three options.
Futura Medical plc Annual Report 2023 | 15
SPOTLIGHT ON COMMERCIAL PARTNERS
Building a global network of leading consumer healthcare partners who
are well resourced to commit significant marketing spend and expertise
HALEON PLC (“HALEON”) – USA
In July 2023, Futura entered into a groundbreaking
licensing agreement with world leading consumer
healthcare Company Haleon (previously GSK
Consumer Healthcare) for the rights to exclusively
commercialise Eroxon® in the USA. As part of the
agreement, Futura received an initial upfront
payment of US$ 4 million, will receive further royalty
payments on all sales, and potential commercial
and performance driven sales milestone payments
totalling between US$ 5 million and US$ 45 million
payable over the course of several years.
Haleon will be responsible for all investment
activities related to the launch and marketing of
the product in the USA, with Futura providing
ongoing technical support for OTC product
development and commercialisation opportunities.
COOPER CONSUMER HEALTH
(“COOPER”) – EUROPEAN ECONOMIC AREA,
UNITED KINGDOM AND SWITZERLAND
Cooper is a leading European independent
self-care organisation, and has the rights to
commercialise Eroxon® throughout the European
Economic Area (“EEA”), the United Kingdom and
Switzerland. Under the terms of the agreement,
Futura received an initial upfront payment, and
will receive undisclosed cumulative sales milestone
payments. The original agreement was for an initial
term of five years complying with EU competition
law but was extended in January 2024 to last
another five years until January 2029. Futura
remains legal manufacturer and is responsible
for the supply of Eroxon®, through its third-party
contract manufacturers.
MENARINI KOREA LIMITED
(“MENARINI KOREA”) – SOUTH KOREA
Menarini Korea, a wholly owned subsidiary
of Menarini Group, has the exclusive rights to
commercialise Eroxon® in South Korea. Under the
terms of the agreement, Menarini is responsible
for all costs related to the regulatory approval and
marketing of the product in the region, including
a clinical bridging study if necessary. Futura
provides reasonable technical support for product
development and commercialisation and received
an upfront payment. Futura will supply Eroxon®
from Futura’s third-party contract manufacturers.
Menarini is now in discussions with the Korean
regulator relating to the marketing authorisation of
Eroxon®.
LABATEC PHARMA (“LABATEC”) – GULF
CO-OPERATION COUNCIL (“GCC”) REGION
AND MIDDLE EAST
Swiss-based specialty pharma company Labatec
has the rights to exclusively commercialise Eroxon®
in the GCC region as well as Jordan, Lebanon and
Iraq. The initial licence agreement term is for eight
years with the ability to extend for successive two-
year terms by mutual consent.
M8 PHARMACEUTICALS INC (“M8”) – CENTRAL AND SOUTH AMERICA
Specialty biopharmaceutical company M8 has the rights to exclusively develop and commercialise Eroxon® in
Central and South America, including Brazil which is the largest market for prescription treatments for erectile
dysfunction. The agreement is for an initial term of 15 years. In November 2023 the agreement was extended
from Brazil and Mexico to the rest of the Central and South American region. Futura has received an undisclosed
upfront milestone payment from M8 as part of the extended agreement. M8 will be responsible for all costs
related to the regulatory approval and marketing of the product. Futura will provide reasonable ongoing technical
support for OTC product development and commercialisation.
Futura Medical plc Annual Report 2023 | 16
HOW EROXON® HAS CHANGED LIVES
Two real-life case studies
Approximately 50% of men over the
age of 401 and around 25% of men
under 402 have experienced erectile
dysfunction (ED) at some time.
These numbers are likely to increase as a result of obesity,
an ageing population and the rise of other conditions
associated with ED. However, UK consumer research
shows that while ED is increasingly common, many men
still struggle to discuss their intimacy issues3.
Dr Janine David, specialist in men’s health and ED notes:
“Apart from the obvious impact that ED has on a man’s sex
life, it also undermines intimacy, relationships and self-
esteem, as well as emotional and psychological health. The
wider impact of ED is detailed in recent research which
found that half of men with ED feel a sense of failure when
they can’t perform and almost as many – 47% – experience
embarrassment or shame3.
“The launch of Eroxon® in 2023
in the UK was a game-changer
for the growing number of men
— and their partners — who are
affected by erectile dysfunction.
It is the first clinically proven OTC
topical ED treatment that helps
men achieve an erection in just 10
minutes in 60% of applications4.”
Here David Brown and Darren Ramsey share their
experiences of ED and the difference Eroxon® has made to
their lives, and their partner’s lives. Their names have been
changed to protect their privacy5.
Eroxon® for me was just a breath
of fresh air and it gave me back
my confidence. My partner was
thrilled. I think it was because it
was quite frustrating for us both
at that time. There was a sense of
relief for both of us.”
DAVID BROWN5
Eroxon® user
David Brown5, aged 45 began experiencing ED
about four years ago, when he and his partner
were trying for a baby.
David admits: “I felt pressure to perform and romance
went out the window, and that's when ED became a
bit of an issue. I mean, I did have sort of issues prior
to that, but they could well have been alcohol or
stress related. I spoke to the GP, who said there was
nothing physically wrong with me, it was probably
stress related and would resolve itself.
“The clock was ticking, so we went for fertility
treatment and had a beautiful baby girl — but
the ED didn’t resolve itself. Sometimes it was all
right and sometimes it wasn't. It was very random.
And the more I’d stress, the more likely it was
that nothing would happen. I was slightly sort of
embarrassed by the whole situation, so I didn't
really want to go to the chemist and ask for it in
front of everyone else. It felt emasculating and
there’s certainly a stigma attached to ED.
“Then I started using Eroxon® and it really, really
changed things for me. The fact that it works so
quickly is incredible. It’s fantastic! You put it on
and it works pretty much straight away. Ten or 15
minutes and you're good to go! The application
of the gel is really easy. I suppose some people
would say it was kind of arousing, because the gel
does seem to do something to the sensitivity that
enhances the overall experience.”
Futura Medical plc Annual Report 2023 | 17
HOW EROXON® HAS CHANGED LIVES
Darren Ramsay5, 34 is married to Louise and they
have a five-year-old daughter, Chloe. Darren
started experiencing ED from his mid-20s.
Darren notes: “I don’t smoke, I'm not a massive
drinker and I’m fit and active, but I was having a lot
of mental health issues and this was affecting me
mentally and emotionally.
“The ED got worse over time and then it started
affecting my marriage because I couldn't be as
intimate as I wished. You start feeling inferior
because you sense like it's your fault, because that’s
the way the body makes you feel. It's a real guilt trip.
“I thought it was an older person problem and I just
thought it was just my mental health taking a toll
on me, but it worked out that it wasn't. Once I was
comfortable with my mental health, we were still
having the same problems. My partner Louise was
supportive, she never showed it, but probably deep
down it was difficult for her. It was probably a year
before I got up the courage to speak to the doctor
about my ED.
“I was told because of my age at the time, I should
just try things over the counter. We were using
a load of lubricants and stuff that has different
sensations to try and make an effect. I tried a
pharmacy only medicine, but it's not as strong as
the medicine you can get prescribed from a doctor.
It didn’t make a massive difference. You could still
slightly get active, but it wasn't a massive difference.
“Then I started using Eroxon®. For me, it worked
within five to ten minutes of applying the gel. I think
the best way to describe it when applied, is that
it's a warm sensation. That’s what I experienced.
It’s an enjoyable feeling and it just seemed to help
progress; it was easier to get an erection. Plus, you
can have your partner put the Eroxon® gel on while
you're doing foreplay. However, if you didn’t want
them to know, you could go to the bathroom and
then put it on and come back in.
LAST WORD,
DR JANINE DAVID
“Men sometimes describe ED
as a huge cloud hanging over
them which makes them feel
hopeless and helpless as well
as embarrassed or feeling
inadequate – all barriers
to seeking effective ED
treatment. Many men with untreated ED say it has made
them feel less of a man and these doubts and insecurities
will inevitably lead to anxiety and stress.
“We need to examine the difficulties which still prevent
men from seeking help and the damage that denial
can inflict on both their relationships and their own
emotional wellbeing, and Eroxon® is very much part of that
conversation.
“The unique topical action of Eroxon® means it can
be incorporated into foreplay to enhance intimacy. In
addition, we know from the clinical trials run that there
are minimal side effects and no known drug interactions
when using this topical therapy. Another big plus is the
gel’s rapid-onset, which restores spontaneity in love-
making, something that consumer research confirms is
valued by 97% of men3. There was clearly a need for a fast-
acting, clinically proven topical ED therapy — and Eroxon®
has fulfilled that need.”
1
2
3
Feldman HA et al. J Urol 1994; 151: 54 – 61
Salonia et al “One Patient Out of Four with Newly Diagnosed Erectile Dysfunction Is
a Young Man—Worrisome Picture from the Everyday Clinical Practice”, The Journal of
Sexual Medicine, Volume 10, Issue 7, July 2013
Omnibus survey of 1,081 ED sufferers and their partners conducted by Perspectus Global
in January 2023
4 MED3000, a clinically proven, fast-acting topical product for Erectile Dysfunction with the
prospect of being the first globally available OTC treatment for ED; Professor David Ralph
(University College London), Tim Holland (Futura Medical), Ken James (Futura Medical);
February 2023
5 For the two case studies the names of the men have been changed to protect their
privacy. Their stories are published with their consent.
Futura Medical plc Annual Report 2023 | 18
My partner was very happy
with us using Eroxon® because
obviously it did what it was
meant to do and it allowed us
to be intimate together as well
as allowing for spontaneity into
our relationship. It was also
more enjoyable, because you
are confident Eroxon® is going
to work.
“The gel was really easy to use
and it’s been a great success
for me. I also now have a
confidence boost and a ‘spring
in my step’ as they say.”
DARREN RAMSAY5
Eroxon® user
OUR BUSINESS MODEL
A sustainable model geared for our success
As Futura
moves into a
new phase of its
development
and to reflect our
new strategy, we
have reviewed
our business
model which is
centred on our
ability to innovate,
attract leading
commercial
partners and
extend our reach.
KEY RESOURCES
ABILITY TO ADDRESS A LARGE UNDERSERVED MARKET THROUGH:
People
Innovate
• Highly experienced, loyal and motivated team focused
on innovative solutions
• Access to a team of 30 consultants and Key Opinion
Leaders used for their specialist knowledge and
leadership in the pharmaceutical and consumer
healthcare field
• Strong results-driven culture and teamwork
Expertise and innovation
Innovative and experienced R&D team with regulatory agility – proven ability to
research and develop award-winning product
Attract
De-risked go-to-market strategy – attract leading consumer healthcare partners who
are well resourced to commit significant marketing spend and expertise
• Highly efficient patented proprietary topical formulation
expertise
Extend
• Expertise in clinical development and clinical trials,
regulatory, quality, manufacturing and supply chain
management
• Semi-virtual structure with outsourcing optimised to
maximise expertise and minimise overhead cost
Broaden the reach and extend the range of opportunities in the sexual
health market
Strong leadership
Delivering solutions that make a difference
Outcomes
• Experienced management team with expertise in
researching and developing innovative products as well as
business and commercial acumen in the global consumer
healthcare market
• Expertise in US consumer healthcare market with two
Directors based in the USA who have spent more than 30
years each in senior management roles in leading OTC
consumer health businesses.
Sexual health issues, specifically ED, can be detrimental to the quality of life of those
who experience it and their partners. We provide clinically proven sexual health
treatments that enhance their quality of life.
Delivering sustainable profitability
Our aim is to deliver sustainable profits by using our ability to develop and globally
commercialise our innovative products in a cost effective manner, maximising the
significant opportunity in the OTC sexual health market.
Futura Medical plc Annual Report 2023 | 19
OUR BUSINESS MODEL
We also wanted
to share the
two different
operating models
we have with
our commercial
partners.
TYPICAL OPERATING MODELS
IP LICENCE MODEL
DIRECT SALES MODEL
Manufacture
Licensee
Futura
Regulatory
and Quality
Sales and
Marketing
Licensee
Futura and Licensee
Licensee
Licensee
We generate
revenue through:
Royalty payments
Direct sales
Milestone payments
Milestone payments
Read more about our
strategy on page 21
Futura Medical plc Annual Report 2023 | 20
OUR STRATEGY
Address, Broaden, Commit: a refined strategy for our next phase
of growth
This year has seen us move from a pre-revenue R&D company to a business
with a commercialised product selling online and on the shelves at retailers
with first meaningful revenues being generated. This is a significant shift and
therefore it feels appropriate to refine our strategy.
OUR REFINED STRATEGY IS AS FOLLOWS:
Our strategy is to commercialise innovative and clinically
proven products for the OTC sexual health market. We will
then partner with leading consumer healthcare partners
who are well resourced to commit significant marketing
spend and expertise.
This strategy is aligned with the well-publicised
demographic changes of ageing populations, increasing
prosperity and the expectation of leading a full and active
life no matter your age.
With an innovative R&D team, we will look to fulfil the
needs of the large, underserved OTC sexual health market.
Going forwards, we will report against our three
strategic pillars:
ADDRESS
Address the growing needs within the
OTC sexual health market
Priorities for 2024
Address worldwide demand for Eroxon®
through strengthening our supply chain
and commercial network whilst achieving
further regulatory approvals and further
launches across the world
OUR THREE
STRATEGIC
PILLARS
BROADEN
Broaden the Company’s clinically proven
product range leveraging its innovative
and experienced R&D capability whilst
being mindful of costs and focusing on
ROI
Explore other range extensions as well as
new innovative products within the sexual
health category to meet further unmet
demand, supported by clinical data whilst
remaining mindful of costs
COMMIT
Commit to delivering strong returns for
shareholders, sustained profitability and
financial discipline
Deliver further revenue growth and progress
on the path towards profitability in the next
12 months
Futura Medical plc Annual Report 2023 | 21
OUR STRATEGY
In order to maintain appropriate transparency and
disclosure, we have reported our progress for this year
against our 2023 strategic priorities.
2023 priorities
(taken from previous Annual
Report)
Performance vs priority
Approval of Eroxon® by the US FDA as an
OTC medical device in Q2 2023.
In June 2023, Eroxon® received FDA approval in the USA, the largest consumer healthcare
market in the world.
First launches under the brand name
Eroxon® in Europe with further launches
planned in 2024, with first revenues
reported.
Our European distribution partner, Cooper, launched in the UK and Belgium in March
2023, followed by soft launches in France, Italy and Spain. We have been encouraged by
the performance to date in these initial markets, with Eroxon® taking c. 20% market share
of approved ED treatments in the UK and Belgium within 12 months of launch, resulting in
first meaningful revenues of £3.1 million.
Sign further agreements for key markets
and countries worldwide – with the
USA being the main focus – to build a
strong global network of licensing and
distribution partners and a strong brand
identity for Eroxon®.
Following FDA approval, the Company was delighted to announce that it had entered
into an agreement with Haleon plc, the world leading consumer healthcare company, for
exclusive marketing and distribution rights in the USA.
In addition, during the year, the Company extended its distribution agreement with
M8 Pharmaceuticals Inc from Brazil and Mexico to cover a further fourteen countries
throughout the Central and South American region.
Continue to support our commercial
partners in their own submissions to local
regulatory bodies and in their launch
preparations.
Expand our supply chain and
manufacturing capabilities to increase
supply chain robustness and capacity.
The Company also received regulatory approval in Australia.
Post period-end in January 2024, the licensing agreement with Cooper Consumer Health
was extended until January 2029.
The Company’s distribution partners received a number of approvals including Saudi
Arabia and Mexico and launched in the UAE.
Agreement in principle was reached with two new Contract Manufacturing Organisations
located in the USA and EU for the production of Eroxon®.
Futura Medical plc Annual Report 2023 | 22
KEY PERFORMANCE INDICATORS
A measure of our progress
The Directors consider the successful achievement of licensing and
commercialisation to be the major drivers of value creation for the Group.
Key to strategy
Address
Broaden
Commit
There are other financial and non-financial key performance indicators
which the Directors use as a measure of the Group’s performance.
Read our Strategy
on page 21
REVENUE
GROSS PROFIT
NET LOSS AFTER TAX
£3.10m
(2022: £nil)
£1.77m
(2022: £nil
£6.51m
(2022: £5.85m)
CASH RESOURCES AT
31 DECEMBER 2023
£7.71m
(2022: £4.03 m)
Link to Strategy
Link to Strategy
Link to Strategy
Link to Strategy
2023
2022
2023
2022
2023
2022
2023
2022
NON-FINANCIAL MEASURES
Number of countries Eroxon® launched
Number of commercial partners
The Group is focused on the commercialisation of
its lead asset Eroxon® and building a network of
leading consumer healthcare partners.
2023
2022
0
8
2023
2022
5
4
Read our Financial
Review on page 29
Futura Medical plc Annual Report 2023 | 23
Futura Medical plc Annual Report 2023 | 24
PRODUCT REVIEW – EROXON®
A unique product that is winning approval from consumers and industry
professionals alike
WHAT IS EROXON®?
Eroxon® is a breakthrough treatment for ED available
over the counter and without prescription, and which is
clinically proven to help men achieve an erection within 10
minutes. Eroxon® is a clear gel that can be applied by the
man or their partner, available in a single dose tube.
WHAT UNMET NEEDS IS EROXON®
ADDRESSING?
Prior to Eroxon®, existing treatments for
ED were available only on prescription in
most countries around the world, creating
barriers to access1. Embarrassment, denial,
reticence, cost of consultation and lack of
awareness may prevent someone seeking
the help of a doctor. Sexual partners of
men with ED wishing to be supportive and
solutions-oriented are doubly hindered by
these factors as only the sufferer can be
prescribed the treatment.
On-demand oral treatments such as
sildenafil (brand name “Viagra®”) typically
take between 30 minutes to one hour to
work, requiring planning and patience,
which stand in the way of intimacy and
spontaneity, and put undue pressure on
couples. Oral treatments can also have
systemic side effects and cannot be taken
in combination with several medications.
As a result of all these barriers and unmet
needs most men with ED are either not
diagnosed or not treating their ED.
WHERE IS EROXON® AVAILABLE?
Eroxon® is a new brand and a new category
in most markets. Eroxon® is now approved
in a number of markets across the world
including in Europe, the USA, six countries
in the Middle East, Australia and Mexico.
Eroxon® launched in its first markets the
UK and Belgium in March 2023, being
available to consumers for the first time
and changing the lives of men with ED
and their partners. This was followed by
further soft launches in Europe and in the
UAE with full launches in ten countries
including key European markets such as
France, Italy and Spain already occurred or
expected during the first half of 2024.
50%
Approximately half of all men
with ED do not discuss their
condition with their doctor2
Read more about our
marketplace on page 11
Futura Medical plc Annual Report 2023 | 25
Pack from our licensing and
distribution partner in Europe
UNIQUE BENEFITS OF EROXON®
10
minutes
Fast-acting,
helping to
achieve an
erection within
10 minutes
Excellent safety
profile
Available without
a prescription
Can involve
the partner in
treatment and
easy to use
PRODUCT REVIEW – EROXON®
OTC STATUS
CLINICALLY PROVEN EFFICACY
EXCELLENT SIDE EFFECTS PROFILE
Eroxon® can be purchased online or in person without a
doctor’s prescription, making treatment for ED easier to
access and addressing some of the barriers to treatment
mentioned previously.
FAST-ACTION HELPS RESTORE SPONTANEITY
A key advantage of Eroxon® is that it works fast helping
men get an erection within 10 minutes which means
Eroxon® can be used as part of foreplay helping to restore
intimacy and spontaneity in the relationship. Partners
can also be part of the solution and apply Eroxon® to their
partner.
1
2
In the UK, Ireland, Norway, Poland, New Zealand, and Switzerland, sildenafil 50mg can
be purchased without prescription but still requires the involvement of the pharmacist.
Cialis 10mg has recently switched OTC in the UK and also requires involvement of the
pharmacist.
Jannini et al – Health-related characteristics and unmet needs of men with erectile
dysfunction: a survey in five European countries, J Sex Med, 2014 Jan.
60%
63%
of erections occurred
within 10 minutes of
application (FM57)
of men using Eroxon® met
or exceeded the MCID* at
12 weeks (FM57 and FM71)
* MCID is the minimal clinically important difference (4 IIEF-EF Units) a criteria used by
regulators when assessing efficacy, Rosen et al 2011.
Eroxon® is a gel that has a unique evaporative physical
action which, through a rapid cooling and then warming
effect, stimulates nerve endings on the head of the
penis which increases blood flow and ultimately leads
to erections. The action of Eroxon® as a local gel is fast,
helping men achieve an erection within 10 minutes.
The efficacy of Eroxon® was proven in two Phase 3 clinical
trials conducted in Europe and the USA which were used
to obtain regulatory approval in countries around the
world including Europe and the USA.
Eroxon® has an excellent side effect profile with no known
drug interactions. The overall rate of side effects for the
two Phase 3 studies was very low. The table below shows
a list of side effects experienced by men and women that
occurred in more than 1% of subjects.
Men – Adverse events (1% or more)
Headache
Penile burning sensation
Women – Adverse events (1% or more)
Headache
Percentage
of subjects
3.0%
1.0%
Percentage
of subjects
1.3%
The table above lists adverse events that occurred at 1% or more in the clinical studies when
the data is combined (FM57 and FM71). The adverse events are Treatment Emergent Adverse
Events defined as AEs that begin after the start of trial medication and the percentages are
based on the combination of the side effects for both studies with 297 subjects.
The results of the Phase 3 clinical trials were presented at
the Sexual Medicine Society of North America Conference
in 2022 and at the European Society for Sexual Medicine
(ESSM) Congress in 2023 and 2024.
EU and UK approval
US approval
2021
2023
2018–2020
2021–2022
2023
FM57
Phase 3 dose-ranging multi-
centre randomised double
blind study in men with ED
FM71
Phase 3 multi-centre
randomised open label
study in men with ED
UK and Belgium
launch
Futura Medical plc Annual Report 2023 | 26
PRODUCT REVIEW - EROXON®
Our strategy in action – European launch
For the first time Eroxon® is
available to men with ED and
their partners with the first
launches of Eroxon® in the UK
and Belgium in March 2023 by
our European partner Cooper.
View our European partner's
website eroxon.eu
Cooper Consumer Health (“Cooper”) launched in the
UK and Belgium in March 2023, followed by online-only
availability without advertising or promotional spend (“soft
launches”) in France, Italy and Spain with full launches
in at least six countries including key European markets
such as France and Spain on track to take place by the end
of April 2024. The results of the launches in these initial
markets have been encouraging, with Eroxon® taking
c. 20% market share of approved ED treatments in the
UK and Belgium within 12 months of launch, very strong
media interest in the launch, early signs of repeat purchase
from customers, and Eroxon® receiving several high profile
industry awards.
LAUNCH AND RETAIL SUCCESS STORY
The UK launch PR campaign was very successful with
exclusives in national newspapers and the product being
discussed on TV. This was followed by a significant TV
advertising campaign and in-store activity. The product
was initially only available through Boots, the UK’s leading
health and beauty retailer, and one of the most trusted UK
healthcare brands. This was a key element of the strategy
to build the credibility of the product, alongside the
KOL and HCP engagement programme. Eroxon® is now
available in over 2,500 retail stores across the UK as well as
online from retailers such as Amazon.
INDUSTRY RECOGNITION
Eroxon® has received several high profile industry awards.
Eroxon® has won the “New Product of the Year, Healthcare”
category at the Boots Supplier Awards 2023 and Cooper
won the Best Big Budget OTC campaign at the 2023 UK
OTC Marketing Awards and was highly commended in a
number of other categories.
KOL AND HCP ENGAGEMENT
Cooper has undertaken a programme of webinars,
presentations and attendance at conferences as well as
produced materials for healthcare professionals. Cooper
had a strong presence at the last two European Society
of Sexual Medicine (“ESSM”) Congresses in particular at
the February 2024 ESSM Conference in Bari, Italy where
they were a main sponsor. Three leading KOLs presented
Eroxon®’s mode of action and the clinical evidence,
followed by a Q&A. Over 150 delegates attended the
presentation and several hundreds visited the Eroxon®
booth over three days. The response and feedback from
delegates was very encouraging.
Available in
>2,500 stores
Across the UK as well as online from
retailers such as Amazon
c. 20%
market share
Of approved ED treatments in the UK and
Belgium within 12 months of launch
1 million
packs
Shipped by Futura
Futura Medical plc Annual Report 2023 | 27
PRODUCT REVIEW - EROXON®
Our strategy in action – US go-to-market strategy
2023 was a year of great progress
towards our goal of launching
Eroxon® in the USA with the FDA
approving Eroxon® in June and Futura
signing a deal with Haleon in July.
COMMERCIALISATION DEAL SIGNED WITH
HALEON FOR THE USA IN JULY 2023
In July 2023, Futura entered into a groundbreaking
licensing agreement with world leading consumer
healthcare company Haleon plc (“Haleon”) for the rights
to exclusively commercialise Eroxon® in the USA. As part
of the agreement, Futura received an initial upfront
payment of US$ 4 million, will receive further royalty
payments on all sales, and potential commercial and
performance driven sales milestone payments totalling
between US$ 5 million and US$ 45 million payable over
the course of several years.
Haleon is responsible for all investment activities related
to the launch and marketing of the product in the
USA, with Futura providing ongoing technical support
for OTC product development and commercialisation
opportunities. Haleon continues to advance the launch
plans in the USA to bring the product to market and we
are expecting the launch by early 2025.
ABOUT HALEON
Haleon (previously GSK Consumer Healthcare) is a
global leader in consumer health, with a purpose to
“deliver better everyday health with humanity”. Haleon’s
turnover in 2023 was £11.3 billion1. Haleon’s product
portfolio spans five major categories – Oral Health,
Pain Relief, Respiratory Health, Digestive Health and
Vitamins, Minerals and Supplements. Haleon has a range
of long-standing brands – such as Advil, Sensodyne,
23 million
Men with ED in the USA3
75%
Three in four men with
ED in the USA are not on
treatment4
Panadol, Voltaren, Theraflu, Otrivin, Polident, Parodontax
and Centrum – that have been built on trusted science,
innovation and deep human understanding making them
an ideal partner to launch Eroxon® in the USA, which is
the largest consumer health market in the world. In the
USA Haleon was awarded Walgreens Supplier Award: 2023
Health & Wellbeing Expertise, thanks to its leveraging of
shopper insights. Haleon has a commercial presence in 170
markets2.
FDA APPROVED
In June 2023, Eroxon® received FDA marketing
authorisation in the USA. Eroxon® is the first OTC topical
gel available to treat ED in the USA. The FDA sets a very
high standard in evaluating the effectiveness and safety
of De Novo Medical Devices. We met this standard with
our submission of 22 clinical, biocompatibility, human
factor studies, and performance bench tests which were
rigorously reviewed and accepted by the FDA.
US MARKET OPPORTUNITY
The USA is the largest consumer healthcare market and
has the potential to be the largest market for Eroxon®
helping to address the unmet needs of men with ED. There
are around 23 million men with ED in the USA3 but three
out of four are not on treatment4 highlighting significant
unmet needs. According
to Ipsos’ forecast,
commissioned by Futura,
the market opportunity
for Eroxon® OTC in the
USA is US$ 350+ million
(retail price)5. This is
based on a retail price of
US$ 5 per tube6.
US$ 350+
million
market opportunity in
the USA5
KEY INSIGHTS FROM THE IPSOS US MARKET
RESEARCH
In 2022 Futura commissioned independent market
research from Ipsos in the USA5. Ipsos conducted extensive
research talking to both doctors and ED sufferers before
conducting an online survey with 400 ED sufferers and 100
female partners.
Key learnings from the Ipsos US market research
• Strong positive reactions to the Eroxon® concept from
men, women and doctors with speed of onset the key
benefit for consumers.
• Strong purchase intent from men with ED and their
female partners.
• Partners want to play a key role in treatment with high
levels of interest from female partners in using Eroxon®
and buying Eroxon® themselves.
• Availability of low-cost generics has not eroded the
opportunity for Eroxon® with peak sales achieved at
US$ 5 retail.
Some of the other research findings
1 in 4 times an “on demand” oral PDE5is is
taken men do not then attempt intercourse.
81% of female partners would probably/
definitely buy Eroxon®.
90% of ED sufferers would probably/ definitely
buy Eroxon® if their partner brought it home.
1 Haleon 2023 full year results, February 2024
2 Haleon website, accessed March 2024
3 2021 JSB Partners estimate based on US Census International Programs Population by
age groups and “Prevalence of erectile dysfunction: Massachusetts Male Aging Study”,
1987 ± 1989 (n=1626); source Kleinman et al. J Clin Epidemiol 2000.
4 Frederick L., “Undertreatment of erectile dysfunction: claims analysis of 6.2 million
5
patients”, J Sex Med, 2014, Oct, (10):2546-53.
Ipsos research carried out on behalf of Futura in the USA, 2022
6 Pricing strategy is the responsibility of our commercial partner.
Futura Medical plc Annual Report 2023 | 28
FINANCIAL REVIEW
Delivering our first meaningful revenues with momentum building
ANGELA HILDRETH
Finance Director and Chief
Operating Officer
“Futura continued to focus
its financial and human
resources on Eroxon®.
I am incredibly proud to be
reporting first meaningful
revenues.”
As outlined in the Chairman’s Statement and Chief
Executive‘s Review, Futura continued to focus its financial
and human resources on Eroxon®, its clinically proven
breakthrough treatment for erectile dysfunction (“ED”).
During the year, Futura launched Eroxon® in a number
of markets, including the UK, and I am incredibly proud
to be reporting first meaningful revenues. These initial
launches have been highly encouraging with Eroxon®
taking c. 20% market share of approved ED treatments
in the UK and Belgium. The Company also achieved
marketing authorisation in the USA and secured a
standout commercial partner in Haleon to launch Eroxon®
in the USA.
FINANCIAL RESULTS AT A GLANCE
Revenue
Cost of goods
Gross profit
57%
FY 23
3,100,968
(1,326,743)
1,774,225
FY22
–
–
–
Research and
development
costs
Administrative
costs
Adjusted
operating loss*
Share-based
payments
Operating loss
before tax
(2,045,988)
(4,131,224)
(3,971,710)
(2,068,413)
(4,243,473)
(6,199,637)
(2,720,297)
(671,852)
(6,963,770)
(6,871,489)
* Adjusted for a non-cash share-based payment charge of £2.72
million (2022: £0.67 million). The share-based payment charge
predominantly relates to the LTIP award in October 2023.
REVENUE
Eroxon® initially launched in March 2023 and the Company
delivered total revenue of £3.10 million in 2023 (2022: £nil).
Revenues were predominantly generated from Eroxon®
sales and further details of revenue are provided in Note 5
to the consolidated financial statements.
In July 2023, the Group signed an exclusive commercial
agreement with Haleon to commercialise Eroxon® in
the USA and an upfront payment of £3.20 million (US$
4 million) was received in 2023 upon execution of the
agreement. This is expected to be recognised in the
Consolidated Statement of Comprehensive Income in full
in the first half of 2024. Details of the revenue recognition
policy can be found in Note 2.6 of the consolidated
financial statements.
COST OF SALES
Cost of sales were £1.33 million (2022: £nil) and generated
a gross profit of £1.77 million (2022: £nil) reflecting a gross
margin of 57%.
RESEARCH AND DEVELOPMENT
Research and Development (“R&D”) costs for the period
ended 31 December 2023 were £2.05 million, compared to
£4.13 million for the period ended 31 December 2022. The
decrease of £2.08 million reflects the focus shifting towards
commercialisation of Eroxon® as headcount costs are now
allocated to administrative expenses. The costs incurred
are mainly reflective of the activities that were required
ahead of US FDA marketing authorisation.
There was no capitalisation of R&D costs in 2023
(2022: £nil).
Futura Medical plc Annual Report 2023 | 29
FINANCIAL REVIEW
ADMINISTRATIVE EXPENSES
BALANCE SHEET
GOING CONCERN
Administrative costs were £6.69 million for the period
ended 31 December 2023 compared to £2.74 million for the
period ended 31 December 2022. This expense includes
a non-cash share-based payment charge of £2.72 million
which is a £2.05 million increase compared to 2022. The
share-based payment charge is predominantly relating to
the LTIP award in October 2023.
The cash balance at the end of 2023 was £7.71 million
(2022: £4.03 million). Current cash runway extends beyond
the Eroxon® launch in the USA expected by early 2025.
Trade and other receivables increased from £0.27 million
at 31 December 2022 to £1.24 million at 31 December 2023
reflecting the commencement of Eroxon® trading.
The increase within administrative expenses includes
headcounts costs which have been historically allocated
to R&D and are now allocated to administrative expenses
as the Company has focused on the commercialisation
of Eroxon®. Other costs that have increased compared to
2022 are associated with supporting commercial partners
and supply chain activities as Eroxon® launches continue
to be rolled out in other markets. In addition, there were
some one-off costs incurred relating to fees associated
with negotiating and concluding US commercial
arrangements for Eroxon®.
LOSS PER SHARE
The basic loss per share for 2023 was 2.21p (2022: 2.03p).
Details of the loss per share calculations are provided in
Note 9 to the consolidated financial statements.
Trade and other payables increased from £1.75 million
at 31 December 2022 to £6.34 million at 31 December
2023 predominantly as a result of the £3.20 million
Haleon upfront payment, received in 2023, which will be
recognised in 2024. The balance is related to an increase
in trade creditors as a result of Eroxon® trading volumes
and equipment procured to expand the supply chain
capabilities.
The current tax asset of £0.38 million at 31 December 2023
(31 December 2022: £1.02 million) relates to the anticipated
R&D tax credit claim in respect of the 2023 financial year.
The Directors believe that it remains appropriate to
prepare the financial statements on a going concern
basis. However, they also acknowledge that a material
uncertainty exists that may cast significant doubt on
the Group’s ability to generate sufficient net revenues
and resulting cash inflows and raise sufficient finance to
meet its expected costs to discharge its liabilities in the
normal course of business. The financial statements do not
include any adjustments that would result from the basis
of preparation being inappropriate. The Auditor's Report
includes reference to the material uncertainty relating to
going concern. Further information in relation to going
concern can be found in Note 2.2 of the consolidated
financial statements.
ANGELA HILDRETH
Finance Director and Chief Operating Officer
Read our Chief Executive's
Review on page 8
View our consolidated financial
statements on pages 67–70
Futura Medical plc Annual Report 2023 | 30
STAKEHOLDER ENGAGEMENT
Taking the long-term interests of key stakeholders into account
The Board recognises its
responsibility to take into
consideration the needs
and concerns of Futura’s key
stakeholders. The Board sought
to understand the views of
its stakeholders through its
interactions with them during
the year and had regards for their
interests in Board discussion and
decision-making.
S172 COMPANIES ACT 2006
The Board is aware of its duties under s172 of the
Companies Act and has worked throughout the
year to promote the success of the Company for the
benefit of its members as a whole. In doing so, it has
regard to those stakeholders identified under s172, as
well as the additional stakeholders set out here.
Shareholders
Commercial
partners
Employees
Our key
stakeholders
Development
partners and
manufacturers
Consumers
Regulators
Healthcare
professionals
Futura Medical plc Annual Report 2023 | 31
STAKEHOLDER ENGAGEMENT
Shareholders
Consumers
Healthcare
professionals
Commercial
partners
How we engage
Outcome of our engagement
The Company engages with its shareholders and potential shareholders on a
regular basis with investor meetings throughout the year as well as focused
roadshows at the time of our published results. In 2023 we also held an
investor seminar in June which included presentations from two Key Opinion
Leaders (“KOLs”) and a representative from Cooper on the UK launch. The
Company produces regular webcasts and video interviews which are posted
to the Investor section of the website.
The people our products are designed to treat are at the heart of why we
do it. Our purpose is clear, “to enhance quality of life”. We consult with KOLs
regularly, hold Advisory Boards at key stages and conduct market research to
help us with consumer insights.
As our commercial partners launch their products they are sharing with us
their in-market experience and insights. Our Quality team monitors customer
complaints as part of our robust Quality Management System.
We have supported our commercial partner Cooper in their HCP and KOL
engagement programme which has included webinars, presentations and
attendance at conferences as well as materials for healthcare professionals.
We attended the last two European Society of Sexual Medicine (“ESSM”)
Congresses to support Cooper, with some of our KOLs presenting at those
conferences. Most recently at the February 2024 ESSM Conference KOLs
presented Eroxon®’s mode of action and the clinical evidence to over 150
delegates and several hundreds visited the Eroxon® booth over three days.
The Board naturally considers its shareholders to be key stakeholders of the
Company and is focused upon delivering long-term value for their benefit.
The results of our investor engagement are reported to the Board to help
inform our strategy and communications.
We are focused on bringing innovative products to the sexual health market
where there are unmet needs with existing treatments. We are excited that
men with ED and their partners can now purchase Eroxon® in some markets
in the EU and the Middle East and are working hard to ensure we make it
accessible to more people across the world.
Read our case
studies on page 17
We learn from our interactions with HCPs and KOLs and refine our product
positioning and the information we provide our commercial partners to
address questions from HCPs and consumers. Discussions with KOLs help us
understand unmet needs and new product opportunities in sexual health.
The Board places great emphasis on selecting the most suitable consumer
healthcare partners who are well resourced to commit significant marketing
spend and expertise as well as have the drive and enthusiasm to make our
products a success. When looking to license the rights to one of our products,
the Company appoints specialist advisers to identify and target the right
potential partners and facilitate discussions and negotiations.
The Company has signed a number of deals around the world to build a
network of licensing and distribution partners for Eroxon® covering the USA,
Europe and the rest of the world.
The Company, where applicable, is supporting commercial partners with
regulatory, IP, manufacturing and commercial input.
The Company is working closely with its new commercial partners building
mutually beneficial long-term relationships to ensure the success of Eroxon®.
Read about our commercial
partners on page 16
Futura Medical plc Annual Report 2023 | 32
STAKEHOLDER ENGAGEMENT
How we engage
Outcome of our engagement
Development
partners and
manufacturers
Employees
We work with our development partners and manufacturers in a
collaborative way that allows them to plan work and become part of the
team. As a semi-virtual company, Futura relies upon its relationships with
external service providers, manufacturers, consultants and subcontractors
to provide resources on an “as needed” basis. These resources provide the
Company with specialist skills and insights as well as additional capacity.
As the business grows these relationships, particularly with partners in
our supply chain, are critical. We therefore work closely with our suppliers,
define clear responsibilities, work in an ethical and collaborative manner to
achieve mutually beneficial outcomes to build sustainable and long-term
relationships.
The Board considers its employees to be a primary stakeholder of the
Company and is conscious of the regard it has to them under s172. Employees
want to be valued and rewarded for their contribution to the Company’s
development and success. The executive team favours an open-door policy
where employee feedback is encouraged. There are regular formal and
informal meetings and gatherings to keep employees informed of key
developments in the Company as well as Company events to promote team
spirit and thank employees.
As the Company prepares to supply Eroxon® to commercial partners around
the globe our contract manufacturing organisations are central to the
long-term success of the product. We are working with two new contract
manufacturers, one located in the USA and the other in the EU to supply
product to our commercial partners. We are working closely with them to
deliver continuity of supply, with a product of high quality at the lowest cost
possible.
The Board, and especially the Remuneration Committee, has had particular
regards to employees as it reviewed and revised the long-term incentive
arrangements as part of its strategy to attract, retain and motivate employees
in order to deliver value for shareholders.
Regulators
Regulators are agencies that regulate medicines and/or medical devices
in their territories. They play a leading role in protecting and improving
public health and supporting innovation. Futura works proactively and
collaboratively with regulators through the pre-submission and submission
process with an open and constructive dialogue.
Constructive discussions with regulators enables Futura to optimise its clinical
development costs and timeline and shorten the time from development
of the product to access by consumers. This approach led to the approval of
Eroxon® OTC in the USA by the FDA.
Futura Medical plc Annual Report 2023 | 33
KEY RISKS AND MITIGATION
KEY RISKS AND MITIGATION
The Audit Committee and the
Risk and Oversight Committee are
responsible to the Board for risk
management and internal controls
and for ensuring that procedures are
in place, and are being effectively
implemented to identify, evaluate and
manage the significant risks faced
by the Group. The internal controls
are designed to manage rather than
eliminate risk and provide assurance
against material misstatement or
loss. Given the current size and
transparency of the operations of
the Group, the Board has concluded
that an internal audit function is not
required, and this will be continually
reviewed as the Company grows.
The Group is at an early stage of its commercial execution
and faces a number of operational, strategic and financial
risks frequently encountered by loss-making companies
who have previously focused financial resources on
R&D activities. The development of medical devices and
consumer healthcare products requires the necessary
safety, quality and efficacy to be demonstrated in
clinical and technical programmes in order to meet the
requirements of the appropriate regulatory bodies.
HOW WE MANAGE RISK
RISK MANAGEMENT
Risks facing the business are identified and assessed on a regular basis
INTERNAL CONTROL
Internal controls are designed and developed to mitigate these risks to an accepted level
COMPLIANCE
Compliance activities assess compliance against the QMS and issues arising
out of the clinical trials that the Company is planning and undertaking
THE AUDIT COMMITTEE AND THE RISK AND OVERSIGHT COMMITTEE
THE BOARD
OPERATIONAL LEVEL
Futura Medical plc Annual Report 2023 | 34
KEY RISKS AND MITIGATION
The Board considers that the key risks of the Group are:
Risk
Potential impact
Mitigation
Commercial risk
The lead product has not yet launched in all key markets. There can be no
guarantee that the Group will succeed in establishing and maintaining
the necessary contractual relationships with licensing partners for the
Group’s products under development. Even when the Group’s products are
successfully developed and approved by the appropriate regulatory bodies,
they may not be launched by the Group’s licensing partners, be successfully
promoted or enjoy commercial acceptance. The Group is reliant on
commercial partners to carry out their contractual obligations and the degree
to which these can be enforced by the Group is limited.
The Group cannot rely upon any historical sales data to accurately predict
revenues generated from commercial sales of the products and revenues
may fall short of expectations.
Financial risk
Availability of capital
The Group is focused on delivering revenue following the launch and roll
out of its lead product Eroxon®. However, the Group has not yet generated a
net positive operating cash flow and its ultimate success will depend on the
Board’s ability to implement the Group’s strategy and generate positive cash
flow.
Lower revenues received or increase in costs of capital and/or unavailability of
requisite, additional capital may constrain growth.
Income
Shortfalls in income mean inability to fund additional R&D activities and/or
result in the need to cut overheads and/or announce to the market lower than
expected revenues.
The Group seeks to reduce this risk by carefully selecting experienced
commercial and distribution partners, maintaining and developing these
relationships and seeking to develop new products of commercial interest to
these and other partners.
Prior to 2023, the Company entered into licensing and distribution
agreements for the European Economic Area, United Kingdom and
Switzerland and South Korea and Eroxon® has now successfully launched
in a number of those markets with further launches planned throughout
2024. In 2023, the Company entered into a commercial agreement with
Haleon plc for the USA. The agreements ensure that the commercial partners
are contractually and financially committed to advertise and promote the
product.
The Company has worked closely with partners to understand their commercial
forecasts and will continue to monitor sales against forecast expectations.
Whilst the Group is at an early stage of its commercial execution, a number
of commercial agreements in key markets have been entered into with
further launches of Eroxon® expected to result in increased revenues in
2024. The Group will work closely with commercial partners to understand
their commercial forecasts and monitor sales against forecast expectations.
The Group is also committed to mitigating this risk by delivering against
the Group’s growth strategy, generating revenue through existing and
new commercial agreements with partners. The Board reviews financial
performance on a frequent basis in order to ensure that Management
are delivering against plan. The Group held a cash balance of £7.7 million
at the end of 2023 and will continue to be revenue generating and cost
conscientious throughout 2024.
Market research suggests that demand for a fast-acting topical, clinically
proven treatment for ED, that is available without a doctor’s prescription is
high. The Company is focused upon delivering revenue growth and avoiding
the need to reduce discretionary R&D and/or overheads as this would impact
on the Group’s growth potential. The Company has received committed
orders for Eroxon® and positive forecast data from commercial partners and
works very closely with commercial partners to ensure mutual success.
Futura Medical plc Annual Report 2023 | 35
KEY RISKS AND MITIGATION
Risk
Potential impact
Mitigation
Disruption to
supply products
The Group relies upon third-party manufacturers to supply its products to
commercial partners. Failure to provide products at prices and quantities
that are commercially acceptable could potentially result in a financial and
reputational loss to the Group and compromise the commercial success of its
products.
The Group has clearly defined agreements with its suppliers and maintains
close oversight of their processes. In addition, the Group has ensured that the
third-party manufacturers have stockpiled key raw materials and packaging.
The Group has also expanded its manufacturing network to add capacity,
protect prices and reduce risk of reliance on individual sources of supply.
Intellectual
property
risk
Key people
The commercial success of the Group and its ability to compete effectively
with other companies depend, amongst other things, on its ability to obtain
and maintain patents sufficiently broad in scope to provide protection for
the Group’s intellectual property rights against third-parties and to exploit
its medical products. The absence of any such patents may have a material
adverse effect on the Group’s ability to develop its business.
The expertise and experience of its key people can have an enormous impact
on business results. Poor recognition and incentivisation could undermine the
Group’s success.
The Group seeks to reduce this risk by only developing products where
legal advice indicates patent protection would be available, seeking patent
protection for the Group’s products, maintaining confidentiality agreements
regarding Group know-how and technology and monitoring technological
developments and the registration of patents by other parties.
The Group appreciates the high level of expertise and contributions made
by its key people. It offers a merit-based, stimulating work environment with
a culture focused on teamwork and freedom to operate. In addition, there
is a competitive performance-based reward structure, including annual
performance bonus and share options that vest over a number of years.
The following risk has also been identified by the Group and will be kept under review as the situations develop, and any potential impact becomes clearer.
Risk
Potential impact
Mitigation
Economic
and political
conditions
The Group is not immune from the risk of downturn in economic conditions
resulting from events outside of its control. Whilst the impact of Brexit and
COVID-19 are both now relatively low, the Russia-Ukraine conflict (as an
example) did impact on the prices of raw materials and energy and other
conflicts that could occur could also potentially impact in the same way.
The availability of capital could also be impacted in any economic downturn.
The impact of economic and political events continues to be monitored as
they arise. To date, there has been limited impact from events such as Brexit,
COVID-19 and the Ukraine-Russia conflict.
Key
Up trend
Down trend
No change
Futura Medical plc Annual Report 2023 | 36
SUSTAINABILITY REVIEW
A core aspect of our business
Our approach to sustainability is an important part of
living our purpose. We are committed to maintaining
a culture whereby we behave in a responsible and
ethical manner and make a positive impact on all our
stakeholders. We believe that operating responsibly and
ethically is vital to our long-term success. Our approach is
underpinned by our Corporate Governance principles of
responsibility, transparency and integrity for the benefit
of our shareholders, employees, commercial partners and
other stakeholders. We strive to be fair, accountable and
responsible in all our dealings. We monitor and report on
our activities in a way that is accurate, balanced, reliable
and clear and enables our shareholders and stakeholders
to compare our progress year on year.
The focus of our sustainability reporting is the UN
Sustainable Development Goals (“SDGs”). The UN SDGs are
a universal call to action to end poverty, protect the planet
and ensure that all people enjoy peace and prosperity.
Each SDG has global sustainable development priorities
and aspirations for 2030, which give a common set of goals
and targets to mobilise global efforts around.
Our focus is on the four SDGs where we believe we can have the greatest
impact and therefore the greatest opportunity to make a real and lasting
difference. These are:
GOOD HEALTH AND WELLBEING
• We are developing sexual health products that are optimised for clinical efficacy, safety, mode of
administration and consumer convenience, and will lead to improved health and wellbeing.
• We continue to place the health and safety of our staff and consultants at the heart of our business
and have adopted a policy to allow our staff to optionally work approximately 50% of the time from
home giving them the flexibility to balance their work and family commitments.
INDUSTRY, INNOVATION AND INFRASTRUCTURE
• We invest in R&D to develop a portfolio of innovative products based on our expertise in topically
delivered gel formulations to generate future revenue and value for our shareholders. We invest
in clinical research to test our products and optimise their safety and efficacy and we share and
publish the results of this research with the medical community to enhance scientific research.
• Our semi-virtual structure supports economic and infrastructure development through the
outsourcing of numerous activities including most recently the manufacturing of our lead product.
If we are successful with our products this creates more opportunities for our partners.
DECENT WORK AND ECONOMIC GROWTH
• Our employees are our most important asset. We are reliant on a skilled workforce for the success
of the Group. We treat our employees fairly and support their ongoing development. We seek to
empower them and ensure that they are fully engaged in all aspects of Futura’s objectives and high
quality standards. Each of our employees contributes and shares in Futura’s success.
• We are focused on commercialising our products and growing the value of the Group, which will
lead to developmental benefits for the shareholders and employees of the Group.
GENDER EQUALITY
• We believe in a diverse and gender balanced
workforce. We are committed to supporting
employment policies and practices that make
provision for equal opportunities and non-
discrimination in our workforce. We aim to have
a balanced workforce across the Group.
TOTAL WORKFORCE GENDER SPLIT
Men
Women
Futura Medical plc Annual Report 2023 | 37
Governance
CONTENTS
GOVERNANCE
Board of Directors
Corporate Governance Statement
Spotlight on our new Chairman
Our Governance Structure
Corporate Governance Report
Audit Committee Report
Remuneration Committee Report
Directors’ Report
39
41
42
44
45
49
50
56
Futura Medical plc Annual Report 2023 | 38
BOARD OF DIRECTORS
A driven and experienced team
The Board is responsible to
shareholders for the proper
management of the Group
and meets at least six times
per year to set the overall
direction and strategy
of the Group, to review
scientific, operational and
financial performance and
to advise on other strategic
matters as they arise. All key
operational and investment
decisions are subject to
Board approval.
Read more about our new Chairman in our
Q&A section on page 42
JEFF NEEDHAM
Non-Executive Chairman
JAMES BARDER
Chief Executive
ANGELA HILDRETH
Finance Director, Chief Operating
Officer, and Company Secretary
CURRENT ROLES
CURRENT ROLES
CURRENT ROLES
Jeff Needham is Non-Executive Chairman
of Futura Medical plc. He was previously a
Non-Executive Director of Futura Medical
plc since November 2021. He is also Chair
of the Nominations Committee. Jeff is also
currently on the Board of McKee Foods Corp.
PAST ROLES
President of Perrigo Consumer Self-Care
Americas (including USA) and Executive
Vice President at Perrigo Company plc, the
US-based manufacturer and marketer of
consumer healthcare products, and a board
director of the US Consumer Healthcare
Products Association (“CHPA”) for 11 years.
BRINGS TO THE BOARD
Over 35 years of experience in
manufacturing and marketing of consumer
healthcare products with strategic and
corporate management expertise, with
particular expertise in the US market.
James Barder is the Group’s Chief Executive.
He assists the Remuneration Committee
and the Nominations Committee (but is
not a member of and does not vote on
either). He has overall responsibility for all
activities of the Group, is a principal contact
for shareholder and investor relations and
leads commercial negotiations. He is also a
Non-Executive Director of Caisson IO Group
Limited and a Director of the Mary How
Trust for Cancer Prevention.
PAST ROLES
Managing Director of Aon Capital Markets
Limited and Non-Executive Director of
Lorega Limited. James predominantly
worked in the field of reinsurance and
finance, including firms he founded.
BRINGS TO THE BOARD
Over 30 years of experience in setting up,
managing and running companies.
Angela Hildreth leads the Group’s finance,
HR and IT functions, drives commercial
and financial strategy, ensures its
compliance procedures and is a principal
contact for shareholder and investor
relations matters.
PAST ROLES
Senior financial roles in a diverse range
of industries, including seven years as UK
Finance Director at Shield Therapeutics
plc (quoted on AIM). She was also an
Independent Non-Executive Director and
Chair of the Audit Committee at AIM-listed
Aptamer plc.
BRINGS TO THE BOARD
Over 15 years’ strategic and operational
financial experience of developing and
commercialising pharmaceutical products.
Futura Medical plc Annual Report 2023 | 39
BOARD OF DIRECTORS
DIRECTOR WHO HAS SERVED
IN THE YEAR
KEN JAMES
Executive Director
and Head of R&D
ANDREW UNITT
Senior Independent
Non-Executive Director
ROY DAVIS
Independent Non-Executive
Director (joined 9 January 2024)
JOHN CLARKE
Non-Executive Chairman
(resigned 18 July 2023)
John Clarke was the Chairman of Futura
Medical plc. He chaired the Nominations
Committee and was a member of the
Audit Committee and the Remuneration
Committee.
CURRENT ROLES
CURRENT ROLES
CURRENT ROLES
Ken James is the Head of R&D. He oversees
the development, regulatory, quality and
manufacturing strategies for the Group’s
existing pipeline and the evaluation of early
stage pipeline opportunities. He is also an
Executive Director.
PAST ROLES
Senior Vice President of Research and
Development for GlaxoSmithKline
Worldwide Consumer Healthcare, having
worked in the UK and the USA.
BRINGS TO THE BOARD
Over 40 years’ experience in the research,
development and commercialisation of
consumer healthcare products.
Andrew Unitt is an Independent Non-
Executive Director and Chair of the Audit
Committee. He is also a member of
the Remuneration Committee and the
Nominations Committee.
PAST ROLES
Chief Financial Officer at the University
of Nottingham until 2016. Andrew spent
eleven years at Boots plc, where he was
Managing Director and Finance Director for
four years of Boots Healthcare International,
its over-the-counter (“OTC”) medicines
business. Andrew was also Independent
Non-Executive Director of AIM-listed
company Oncimmune Holdings plc.
BRINGS TO THE BOARD
Over 20 years of experience as a Finance
Director in a wide range of industries
with strong financial experience and OTC
market expertise.
Roy Davis is an Independent Non-
Executive Director and Chair of the
Remuneration Committee. He is a
member of the Audit Committee and the
Nominations Committee. He is also a Non-
Executive Chair at LungLife AI plc, Foster
and Freeman (the trading name of the
Galton group of companies), Rair Health
Ltd and Inspiration Healthcare Group plc.
PAST ROLES
Leadership positions at a number of
publicly quoted med tech companies,
including CEO of Optos plc and Gyrus
Group plc and Non-Executive Chair at
Medica Group plc.
BRINGS TO THE BOARD
Over 35 years of commercial experience
including in medical devices companies
and strategic consulting and has a
proven track record of successfully scaling
companies and delivering substantial value
for shareholders.
Futura Medical plc Annual Report 2023 | 40
CORPORATE GOVERNANCE STATEMENT
Committed to the highest standards in Corporate Governance
JEFF NEEDHAM
Non-Executive Chairman
Dear Shareholder,
As Chairman of Futura Medical, and on behalf of the
Board, I am pleased to present our Corporate Governance
Statement for the year ended 31 December 2023. The
Board is committed to the highest standards of corporate
governance and to maintaining a sound framework for the
control and management of the Group’s business.
I was appointed as Chairman in July 2023, having
served as a Non-Executive Director since 2021 , following
the departure of John Clarke. I would like to take this
opportunity to thank John and recognise his invaluable
contribution to Futura Medical plc in the 11 years he served
as Non-Executive Chairman.
As Chairman, I have overall responsibility for corporate
governance and in promoting high standards throughout
the Group. As well as leading and chairing the Board my
responsibilities are to ensure:
• Committees are properly structured and operate with
appropriate terms of reference;
• The performance of individual Directors, the Board and
its committees are reviewed on a regular basis;
• The Company has a coherent strategy and sets
objectives against this;
• There is effective communication between the Company
and its shareholders.
Futura Medical has adopted the QCA Corporate
Governance Code (the “QCA Code”) as it considers that
this is the most suitable framework for smaller listed
companies. The Board is committed to the highest
standards of corporate governance and to maintaining
a sound framework for the control and management of
Futura Medical plc. The Board is responsible for leading
and controlling the activities of the Group, with overall
authority for the management and conduct of the
business, together with its strategy and development. The
Board believes that good corporate governance improves
long-term success and the support from our shareholders
is vital to our success. We remain responsive to our
shareholders’ and stakeholders’ views to deliver on our
strategy and objectives.
The principal methods of communicating our application
of the QCA Code are this Annual Report and the Investor
section of our website at www.futuramedical.com. The
QCA Code sets out ten principles and in the Corporate
Governance Report on pages 45 to 48 we have set out the
Group’s application of the QCA Code, including, where
appropriate, cross references to other sections of this
Annual Report and to our website.
JEFF NEEDHAM
Non-Executive Chairman
9 April 2024
Futura Medical plc Annual Report 2023 | 41
SPOTLIGHT ON OUR NEW CHAIRMAN
Q&A
JEFF NEEDHAM
Non-Executive Chairman
“What is important to our
shareholders is maximising
the value of Futura which
we are going to accomplish
by being laser focused on
the commercial execution
of Eroxon® launches in
Europe, the USA, and other
geographies such as South
America, Asia and the
Middle East.”
companies, geographies and responsibilities?
Q Where have you previously worked in terms of
A I had a 36-year career at the Perrigo Company.
Perrigo is the world's largest manufacturer and
marketer of a retailer’s own or store brand consumer
healthcare products, in addition to having a broad portfolio
of its own branded products across the European markets.
I worked primarily in the USA over that 36-year period
and still live in the USA, however I did work in the UK to
establish Perrigo’s presence in the European marketplace.
Over my career, I worked with all of the major US retailers,
establishing, developing, and growing their own brand
consumer healthcare businesses. I would say that I have
been immersed in consumer healthcare for a significant
period of time, and this was recognised by me receiving
the US Consumer Healthcare Products Association
(“CHPA”) lifetime achievement award recently.
Q What are your top three learnings from working
at publicly quoted companies? What are the
highlights as well?
A Right at the top of the list would have to be the
importance of delivering the financial results
throughout the year. It heightens the challenge of
managing a business because, running any business, you
have got to balance long-term strategies and investments
with short-term objectives and results. The need to report
as often as we have to makes striking that balance much
more difficult to achieve.
Also, as a public company, you have to understand that
the true bosses and owners of the business are your
shareholders. You have got to always remember that and
make daily decisions with shareholders front of mind.
Q What is your connection to the UK – what was
your favourite aspect of living and working
in the UK? How has living and working in different
geographies in the USA and Europe shaped and
influenced your career and outlook?
A My family and I really enjoyed our time in the
UK. We consider England and more specifically
Southwest England, a second home for ourselves. I really
enjoyed the lifestyle in the UK. I think the people are
particularly sincere and that it's generally a very good
culture. We made very good, lasting friendships from
our time there. From a business standpoint, the UK has
a somewhat different approach compared to the USA.
When I was based in the UK I learned a lot about the
positive, pragmatic business approach that can contribute
to a healthy work/non-work life balance.
motivated you to take on the role of Chairman?
Q What attracted you to Futura Medical and
A What attracted me was the excitement and
interest that I had with Futura being on the cusp
of having a new product that was nearing approval for
the US market and preparing to be commercialised for
the erectile dysfunction market. Erectile dysfunction
as an OTC business is a virtually untapped consumer
healthcare market with huge potential. In addition, Futura
is comprised of a team of very dedicated individuals
who have been very focused on executing against the
clear objectives they have set for themselves. I have truly
enjoyed my two years of being involved with the business
and can say it has been a very positive experience. I have
really enjoyed my time thus far with Futura and its team.
Futura Medical plc Annual Report 2023 | 42
SPOTLIGHT ON OUR NEW CHAIRMAN
Q What do you bring to Futura?
A I think first and foremost is my US consumer and
broader commercial background. Among the
most important priorities for Futura at this point is the
successful commercialisation of Eroxon® in the markets
where we have regulatory approval. Having managed a
large consumer healthcare business, I bring significant
commercial experience combined with executive
management responsibility. I also understand the
importance of having a robust governance and leadership
structure, and processes to enable the Company to grow
and scale.
shareholders?
Q What do you want to achieve for Futura’s
A Ultimately what is important to our shareholders is
maximising the value of Futura, which we are going
to accomplish by being laser focused on the commercial
execution of Eroxon® launches in Europe, the USA, and
other geographies such as South America, Asia and the
Middle East. I also think having follow-on brand extensions
and new products under that Eroxon® umbrella will be
important to provide long-term growth.
leader in the ED space?
Q Why do you think Eroxon® will become a market
A There are three key factors that give me great
confidence that Eroxon® will establish itself as the
leading brand in the markets in which it is launched.
Firstly, it is going to be the first pure OTC brand on the
shelf that will be accessible to consumers without a
prescription or the need for interaction with a pharmacist
during the purchasing process. That “open accessibility”
for the consumer is key to creating a large market for
the brand. Secondly, Eroxon’s fast onset of action, with its
key brand claim of “Helps you get an erection within 10
minutes”, is a key product advantage over the traditional
oral ED drugs that do not start working for 30 to 60
minutes. And, finally, Futura has had the good fortune to
enter into agreements with market leading commercial
partners that possess deep expertise in executing and
managing successful consumer brand launches. We are
excited that we have the building blocks in place to realise
success in all of our key markets.
Q You have talked about heading up the US Perrigo
business, what do you think a brand needs to be
successful in the USA?
A First and foremost, a new successful brand will
ideally meet an unmet consumer need. We have
that with Eroxon® as the first OTC ED treatment with a
“fast-acting” claim. With that, a strong market launch
will have excellent planning preceding a focused, well-
executed launch, which will drive awareness amongst
the consumer, while educating them of the benefits of
the new brand. Planning, coordination and execution
with all key retailers is key to a successful market launch.
As I stated, we have great confidence in our commercial
partners to accomplish all of these considerations.
have any hobbies?
Q What are your interests outside of work? Do you
A I have always been a runner and am fortunate, in my
advanced age, to still be running fairly regularly, but I
have been running since I was a teenager. I try to prioritise
daily exercise into my schedule. I also like to play golf and
try to do that at least weekly.
workplace?
Q What is your greatest achievement outside of the
A My greatest achievement is my family and I am very
proud of them. I have been married to my wife, Erin,
for 37 years. We have two adult boys and we are very proud
of the success that they are both having in their lives and
that my wife and I are at a point where we can enjoy that.
We are looking forward to welcoming our first grandchild
later this year.
Jeff received a lifetime achievement award
at the US CHPA conference in March 2024.
Futura Medical plc Annual Report 2023 | 43
OUR GOVERNANCE STRUCTURE
Responsible for the Group’s vision, business model, risk and strategy. Together, the Directors are
responsible for providing effective leadership to promote the long-term success of the Group.
View our Board of Directors’ biographies on pages 39 to 40.
THE BOARD
CHIEF EXECUTIVE OFFICER
BOARD CHAIR
BOARD COMMITTEES
Responsible for the day-to-day running of the business
and the implementation of the Group’s strategy.
Leads the Board and facilitates the effective
contribution of all members to meetings.
Three Committees operate under delegated powers
and with clear terms of reference.
SENIOR MANAGEMENT TEAM
Supports the CEO and has management responsibility
for the business operations and its support functions.
NOMINATIONS COMMITTEE
AUDIT COMMITTEE
REMUNERATION COMMITTEE
Reviews the leadership needs of the organisation
and monitors succession planning for both Board
and senior executive roles. Responsible for the
selection process and nomination of all Directors
to the Board, and reviews the structure, size, and
composition of the Board.
Monitors and reviews the financial results and
other reporting and oversees the effectiveness of
risk management and systems of internal control.
Provides confidence to shareholders on the
integrity of reported financial results and challenge
to the External Auditor and senior management.
Ensures there is a formal process for reviewing
salaries, benefits, and other terms of service to
determine appropriate levels of remuneration for
the Executive Directors and other senior executives.
Committee Chair:
Jeff Needham
Members: 3
Meetings: 2
Read their report
on page 49
Committee Chair:
Andrew Unitt
Members: 2
Meetings: 2
Read their report
on page 50
Committee Chair:
Roy Davis
Members: 3
Meetings: 3
Futura Medical plc Annual Report 2023 | 44
CORPORATE GOVERNANCE REPORT
JEFF NEEDHAM
Non-Executive Chairman
PRINCIPLE 1 – BUSINESS MODEL AND STRATEGY
The strategy and business operations of the Group are set
out in the Strategic Report section of the Annual Report.
The full Board meets formally at least six times per year
and informally as required. It is responsible for formulating
and monitoring Group strategy, as well as complying with
legal, regulatory and corporate governance matters. The
strategy and business model and amendments thereto,
are developed by the Chief Executive Officer and his senior
management team and approved by the Board. The
management team, led by the Chief Executive Officer, is
responsible for implementing the strategy and managing
the business at an operational level.
PRINCIPLE 2 – UNDERSTANDING SHAREHOLDER
NEEDS AND EXPECTATIONS
The Group seeks to maintain a regular dialogue with
both existing and potential new shareholders in order
to communicate the Group’s strategy and progress and
understand the needs and expectations of shareholders.
Institutional shareholders and analysts have the
opportunity to discuss general issues and provide
feedback at meetings with the Company. In addition, all
shareholders are encouraged to attend the Company’s
Annual General Meeting.
PRINCIPLE 3 – STAKEHOLDER RESPONSIBILITIES
The Group’s overall strategic objective is to commercialise
innovative and clinically proven products for the OTC
sexual health market. We then partner with leading
consumer healthcare companies who are well resourced
to commit significant marketing spend and expertise.
This strategy is aligned with the demographic changes
of ageing populations, increasing prosperity and the
expectation of leading a full and active life, no matter your
age. With an innovative R&D team and capabilities, we look
to fulfil the needs of the large, underserved OTC sexual
health market.
The Group is aware of its corporate and social
responsibilities and the need to maintain effective
working relationships across a range of stakeholder
groups. In addition to shareholders, these include the
Group’s employees, regulators, commercial partners,
manufacturers, consumers and healthcare professionals.
The Group’s operations and working practices need to
balance the needs of all of these stakeholder groups while
maintaining focus on the Board’s primary responsibility
to promote the success of the Group for the benefit of its
members as a whole.
Now that Eroxon® has had regulatory approval in the USA,
EU and other key markets, the Group has chosen to realise
monetary value via out-licensing deals with commercial
partners. If resources permit, the Group may choose to
advance other products through clinical development
and approval in order to retain the full value of the product
within the Group.
The Group operates in a high-risk and heavily regulated
sector and this is reflected in the principal risks and
uncertainties set out on pages 34 to 36 of our Strategic
Report. The key challenge to the successful development
of this strategy is ensuring that there are sufficient
financial resources that can be deployed in the short
term in advance of the products being able to generate
sufficient financial rewards for the Group in the
longer term.
The Group endeavours to take feedback received from
stakeholders by meeting regularly and responding
accordingly. This feedback ensures that the Group can
respond to new issues and opportunities that arise to
further the Group in the delivery of its long-term strategy.
Further information can be found on pages 31 to 33.
PRINCIPLE 4 – RISK MANAGEMENT
The Audit Committee and the Risk and Oversight
Committee are responsible to the Board for risk
management and internal controls and for ensuring
that procedures are in place, and are being effectively
implemented to identify, evaluate and manage the
significant risks faced by the Group. The internal controls
are designed to manage rather than eliminate risk and
provide assurance against material misstatement or loss.
Futura Medical plc Annual Report 2023 | 45
CORPORATE GOVERNANCE REPORT
The Audit Committee is responsible for reviewing the
effectiveness of these internal controls on an annual
basis and the Risk and Oversight Committee (“ROC”)
provides additional oversight of its operational compliance
in respect of its assets. During 2023 the ROC provided
oversight of the Company’s Medical Device Quality
Management System (“QMS”) as defined in the Medical
Device Quality Manual. The ROC meets at least once a year
or more frequently if required and agenda items are driven
by a management review which assesses compliance
against the QMS and any issues arising out of the
commercial activities and clinical trials that the Company
is planning and undertaking.
Given the current size and transparency of the operations
of the Group, the Board has concluded that an internal
audit function is not required and this will be continually
reviewed as the Group grows. A summary of principal risks
and uncertainties facing the Group, as well as mitigating
actions, are set out on pages 34 to 36 of our Strategic
Report.
PRINCIPLE 5 – A WELL-FUNCTIONING BOARD OF
DIRECTORS
Futura’s Board comprises three Non-Executive Directors
and three Executive Directors. All of the Directors are
subject to election by shareholders at the first Annual
General Meeting after their appointment and will
continue to seek re-election by rotation at least once every
three years.
Board of Directors
During the year under review, the Board comprised three
Executive Directors, a Non-Executive Chairman and two
Non-Executive Directors. Details of the Directors who
served in the year can be found on page 56.
Attendance at Board and Committee meetings
The Board is responsible to shareholders for the proper
management of the Group and meets at least six times
per year to set the overall direction and strategy of the
Group, to review scientific, operational and financial
performance and to advise on other strategic matters as they arise. All key operational and investment decisions are
subject to Board approval. The Board met formally seven times during 2023 and, in addition, authority was delegated on
an ad hoc basis to subcommittees to deal with statutory matters, such as the approval of the full year results and interim
statements.
Director
John Clarke
Andrew Unitt
Jeff Needham
James Barder
Angela Hildreth
Ken James
Board
Audit
Committee
Remuneration
Committee
Nominations
Committee
2/2
2/2
1/1
2/2
3/3
N/A
2/2
2/2
4/4
7/7
7/7
7/7
7/7
6/7
Attendance is expressed by the number of meetings attended/number eligible to attend. Directors’ attendance by
invitation at meetings of committees of which they are not a member is not reflected in the table above.
Non-Executive Directors’ letters of appointment stipulate that they are expected to devote such time as is necessary
for the proper performance of their duties, being not less than 25 days per year. Non-Executive Directors are required
to notify the Chairman before taking on any additional commitments that may impact the time available to devote to
the Non-Executive Director role. The Board is satisfied that all Directors have continued to be effective and demonstrate
commitment to their respective roles.
Independence of Board Directors
The Board considers itself independent. The QCA code suggests that a Board should have at least two independent Non-
Executive Directors who currently sit on the Board of the Company and are regarded as independent under the QCA’s
guidance for determining such independence.
The Non-Executive Directors receive their fees in the form of a basic cash fee and an equity-based fee which takes the
form of nominal price share options under the Company’s Non-Executive Share Option Scheme. To avoid any incentive
that may influence the Non-Executive Directors’ independence, the options grants are not deemed significant, either for
any individual Non-Executive Director or in aggregate. The current remuneration structure for the Board’s Non-Executive
Directors is deemed to be proportionate and in line with market rates. The Directors commit the time required to fulfil
their duties.
PRINCIPLE 6 – APPROPRIATE SKILLS AND EXPERIENCE OF THE DIRECTORS
The Board considers that all of the Non-Executive Directors are of sufficient competence and calibre to add strength and
objectivity to its activities and bring significant experience in the commercial, operational and financial development of
the Group’s products.
Futura Medical plc Annual Report 2023 | 46
CORPORATE GOVERNANCE REPORT
The Board regularly reviews the composition of the Board
to ensure that it has the necessary depth and breadth of
skills to support the ongoing delivery of the Group’s long-
term strategy and the Board is committed to ensuring
diversity of skill, experience and gender.
Board members maintain their skillsets through practice
in day-to-day roles, enhanced with attending specific
training where required. This is a combination of in-house
Company-arranged briefings and external courses.
The Board uses external advisers where necessary to
enhance knowledge or to gain access to particular skills
or capabilities. Accountants and lawyers are used for
diligence work on specific projects. Both the Nominations
Committee and the Remuneration Committee use
recruitment and employment consultants and specialist
advisers have been used by the Board to ensure
compliance in specific areas.
The Chairman, in conjunction with the Company Secretary,
ensures that the Directors’ knowledge is kept up to date
on key issues and developments pertaining to the Group,
its operational activities and the Directors’ responsibilities
as members of the Board. During the course of the
year, the Directors received updates from the Company
Secretary on a number of corporate governance matters.
The Company Secretary provides information and advice
on corporate governance and to individual Directors
on any aspect of their role, particularly supporting the
Chairman and those who chair Board Committees. The
Company Secretary is also responsible for ensuring
that Board procedures are followed, that the Company
complies with company law and AIM Rules and that the
Board receives the information it needs to fulfil its duties
effectively.
The skills and experience of the Board members are shown in the table below:
Director
John Clarke*
Jeff Needham
Andrew Unitt
James Barder
Angela Hildreth
Ken James
Pharma/
OTC sector
Financial
General
management
Other public
company
(Board level)
* John Clarke resigned 18 July 2023
PRINCIPLE 7 – EVALUATION OF BOARD PERFORMANCE
Internal evaluation of the Board, the Committees and individual Directors is undertaken on an annual basis and was
recently completed in March 2024 in the form of peer appraisal, questionnaires and discussions led by the Chairman to
determine their effectiveness and performance as well as the Non-Executive Directors’ continued independence. The
Board may utilise the results of the evaluation process when considering the adequacy of the composition of the Board,
to identify any training and development needs and for succession planning.
The Board, as a collective, is evaluated on diversity, balance, governance and strategy and individual members
are evaluated on a range of criteria such as leadership, strategy, governance, interpersonal skills and integrity. The
performance of the Chairman was also evaluated in the same way and this was led by Senior Non-Executive Director
Andrew Unitt.
The Chairman is responsible for the annual performance assessment of the Chief Executive Officer and the Chief
Executive Officer reviews the performance of the Finance Director/Chief Operating Officer and Head of R&D where
performance against corporate objectives set at the start of the year is measured.
The review in March 2024 concluded that the Directors were satisfied with Board operations and processes with no major
issues raised.
The Nominations Committee continues to monitor the requirement for succession planning.
PRINCIPLE 8 – CORPORATE CULTURE
The Board recognises that its decisions regarding strategy and risk will impact on the culture of the Group as a whole and
that this will impact the performance of the Group. The Board seeks to maintain the highest standards of integrity in the
conduct of the Group’s operations. An open culture is encouraged within the Group with regular communications with
staff regarding progress and staff feedback regularly sought. The Board's assessment of the culture within the Group at
the present time is one where there is respect for all individuals, there is open dialogue within the Group and there is a
commitment to provide the best service possible to all the Group’s customers, which include commercial partners and
consumers.
Futura Medical plc Annual Report 2023 | 47
CORPORATE GOVERNANCE REPORT
PRINCIPLE 9 – MAINTENANCE OF GOVERNANCE
STRUCTURES AND PROCESSES
member present) with the External Auditor at least once
per year.
The Board has overall responsibility for promoting the
success of the Group. The Executive Directors have day-
to-day responsibility for the operational management of
the Group’s activities. The Non-Executive Directors are
responsible for the overall operational management of
the Group’s activities and for bringing independent and
objective judgement to Board decisions.
There is a clear separation of the roles of Chief Executive
Officer and Non-Executive Chairman. The Chairman is
responsible for overseeing the running of the Board,
ensuring that no individual or group dominates the
Board’s decision-making and ensuring the Non-Executive
Directors are properly briefed on matters. The Chairman
has overall responsibility for corporate governance matters
in the Group and chairs the Nominations Committee. The
Chief Executive Officer has responsibility for implementing
the strategy of the Board and managing the day-to-day
business activities of the Group. The Company Secretary
is responsible for ensuring that Board procedures
are followed and applicable rules and regulations are
complied with.
The Audit Committee
The Audit Committee normally meets two to three times
per year and has responsibility for, amongst other things,
reviewing the annual report and accounts and interim
statements involving, where appropriate, the External
Auditor. The Committee also approves the External
Auditor’s fees and ensures the Auditor’s independence as
well as focusing on compliance with legal requirements
and accounting standards. It is also responsible for
ensuring that an effective system of internal control is
maintained. The ultimate responsibility for approving
the annual financial statements and interim statements
remains with the Board.
The Finance Director and Chief Operating Officer, and the
External Auditor attend meetings by invitation only. The
Audit Committee meets privately (without any other Board
The Group’s Auditor is Grant Thornton UK LLP based at
2nd Floor, St John’s House, Haslett Avenue West, Crawley
RH10 1HS and was appointed in 2019 as part of a tender
process. The senior statutory auditor is Jonathan Oakey.
The Remuneration Committee
The Remuneration Committee, which meets as required,
but at least once per year, has responsibility for making
recommendations to the Board on the compensation
of senior executives and determining, within agreed
terms of reference, the specific remuneration packages
for each of the Executive Directors. It also supervises the
Group’s share incentive schemes and sets performance
conditions for share options granted under the schemes.
The Independent Non-Executive Directors and the Non-
Executive Chairman sit on the Committee, and the Chief
Executive Officer attends by invitation only.
The Directors’ remuneration can be found in the
Remuneration Committee Report on pages 50 to 55.
The Directors believe that the disclosures in that report
constitute sufficient disclosure to meet the requirements
of the QCA Code for a Remuneration Committee Report.
Consequently, a separate Directors’ Remuneration Report
is not presented in the Group’s Annual Report. However,
the Committee will continue to review guidance in relation
to the contents of remuneration reports and ensure the
reporting evolves as the Committee considers appropriate.
The Nominations Committee
The Nominations Committee, which meets as required,
has responsibility for reviewing the size and composition of
the Board, the appointment or replacement of Directors,
the monitoring of compliance with applicable laws,
regulations and corporate governance guidance and
making appropriate recommendations to the Board.
The Independent Non-Executive Directors and the Non-
Executive Chairman sit on the Committee, and the Chief
Executive Officer attends by invitation only.
The terms of reference for the above committees can
be found in the Investors section of our website at
www.futuramedical.com.
The Board also oversees the Group’s share dealing code
and its whistle-blowing policies and procedures.
PRINCIPLE 10 – SHAREHOLDER COMMUNICATION
The Group places a high priority on regular communication
with its shareholders and aims to ensure that all
communications concerning the Group’s activities are
clear, fair and accurate. The website is regularly updated
and users can register to be alerted when announcements
or details of presentations and events are posted onto the
website.
The Group’s financial reports can be found in the Investor
section of our website at www.futuramedical.com.
Notice of General Meetings of the Company and results
of voting on all resolutions in future general meetings
can be found in the RNS section of our website at
www.futuramedical.com.
The results of voting on all resolutions in future general
meetings will be posted to the Group’s website after the
relevant meeting.
JEFF NEEDHAM
Non-Executive Chairman
9 April 2024
Futura Medical plc Annual Report 2023 | 48
AUDIT COMMITTEE REPORT
ANDREW UNITT
Chairman of the Audit Committee
THE AUDIT COMMITTEE
EXTERNAL AUDITOR
During the year the Audit Committee considered the
adequacy of financial standards and how existing and new
accounting standards apply to the business. In addition,
the Audit Committee considered how applying these
standards may flow through into internal processes and
controls, the Group’s accounting policies and the Group’s
financial reporting to shareholders.
Whilst the Board has overall responsibility for the review
and approval of the annual and interim accounts, certain
aspects are delegated to the Audit Committee including:
• monitoring the integrity of the financial statements of
the Group and any formal announcements relating to
the Group’s financial performance;
• reviewing accounting standards, policies and
judgements;
• reviewing internal controls and risk management
procedures which arise during the external audit
process, or if concerns are raised by a member of the
Board or by an employee under the Company’s whistle-
blowing process; and
• oversight of the Group’s compliance with legal
requirements ensuring that an effective internal control
system is maintained.
Full terms of reference for the Audit Committee can be
found in the Investor section of the Company website at
www.futuramedical.com.
There were two meetings held in the year and matters
discussed were as follows:
January 2023
Presentation of 2022 Audit Plan
April 2023
The Audit Committee has responsibility for the
relationship between the Group and its External Auditor.
Representatives from the External Auditor are invited to
attend Audit Committee meetings and whilst the Finance
Director and other Executives are invited to attend the
Committee meetings, time at the end of a meeting is
allowed without any other Executive Directors or other
executives present, to give the External Auditor an
opportunity to raise any issues of concern.
The Audit Committee is responsible for reviewing the
scope of work and fee proposals presented by the
External Auditor to ensure that its independence is not
compromised. The independence of the Auditor is kept
under review and is reported once per year, as part of
the Audit Committee Report presented to the Audit
Committee by the External Auditor.
The Group’s External Auditor, Grant Thornton UK LLP,
is engaged to provide its independent opinion on the
Group’s financial statements. A full scope of its work for
the year ended 31 December 2023 is included within the
Independent Auditor’s Report on pages 59 to 66. Grant
Thornton was appointed in 2019 following a tender process.
The senior statutory auditor is Jonathan Oakey.
INTERNAL AUDIT
The Audit Committee reviews the requirement for an
internal audit function on an annual basis, taking into
account the scale and complexity of the Group’s activities
and any issues identified in the assessment of controls. The
Committee remains of the opinion that an internal audit
function is currently not appropriate for the Group and the
Committee will continue to review the appropriateness of
these arrangements.
Presentation of 2022 Audit Report (see 2022 Annual Report
for 2022 Audit Report)
ANDREW UNITT
Chairman of the Audit Committee
Review of 2022 audit performance
Futura Medical plc Annual Report 2023 | 49
REMUNERATION COMMITTEE REPORT
ROY DAVIS
Chairman of the Remuneration
Committee
REMUNERATION COMMITTEE: COMPOSITION
AND TERMS OF REFERENCE
POLICY ON EXECUTIVE DIRECTORS’
REMUNERATION
During the period under review the Remuneration
Committee comprised the independent Non-Executive
Directors and was chaired by Jeff Needham until Roy
Davis joined in January 2024 and took over as Chair. The
Company has adopted the Quoted Companies Alliance’s
Corporate Governance Code (the “QCA Code”) and
the report has been prepared in accordance with the
principles of the QCA Code. The contents of this report are
unaudited unless otherwise stated.
The purpose of the Remuneration Committee is to ensure
that the Executive Directors and other employees are fairly
rewarded for their individual contribution to the overall
performance of the Group. The Committee considers
and recommends to the Board the remuneration of
the Executive Directors and is kept informed of the
remuneration packages of senior staff and invited to
comment on these. There were three Remuneration
Committee meetings during 2023.
The Board retains responsibility for overall remuneration
policy. The terms of reference of the Remuneration
Committee are set out in the Investor Centre/Corporate
Governance section on the Group’s website at
www.futuramedical.com.
Executive remuneration packages are designed to attract
and retain executives of the necessary skill and calibre
to run the Group. Direct benchmarking of remuneration
is difficult given the specialised nature and size of the
Group. The Remuneration Committee recommends to the
Board remuneration packages by reference to individual
performance and uses the knowledge and experience of
the Committee members, published surveys relating to
AIM companies, the healthcare and medicine industry and
market changes generally. The Remuneration Committee
has responsibility for recommending any long-term
incentive plans.
The Board determines whether or not Executive Directors
are permitted to serve in roles with other companies. Such
permission is only granted where a role is on a strictly
limited basis, where there are no conflicts of interest or
competing activities and providing there is not an adverse
impact on the commitments required to the Group.
Earnings from such roles are not disclosed to the Group.
Futura Medical plc Annual Report 2023 | 50
REMUNERATION COMMITTEE REPORT
The table below sets out the elements of the Executive Director’s compensation and how each element operates as well as the maximum level of each element and any applicable
performance measures.
Element and Purpose
Operation
Maximum Level
Fixed Remuneration
Basic Salary
To provide a competitive base
salary for the market and size of the
Group in order to attract and retain
Executive Directors of a suitable
calibre.
Benefits
Usually reviewed annually by the Remuneration Committee and
recommended to the Board, taking account of:
Salary increases will generally be in line with salary increases to other
employees, but may be adjusted to take account of:
• Salary increases awarded to the wider workforce
• Promotion
• Group performance
• Role and experience
• Individual performance; and
• Competitive environment
• Change in scope of role
• Realignment with market; and
• Development and performance in the role
To provide a competitive range of
benefits as part of total remuneration.
Executive Directors usually receive:
• Private medical insurance
No overall maximum has been set, but the level of benefits provided
is determined taking into account the overall cost to the Group.
Retirement Benefits
To provide an appropriate level of
retirement benefit (or cash allowance
equivalent).
SERVICE CONTRACTS
• Salary-related death-in-service life insurance
Executive Directors are eligible to participate in the Group defined
contribution pension scheme. In appropriate circumstances,
Directors may be permitted to take benefits as a salary cash
supplement (which will usually be reduced to take into account
employer National Insurance contributions).
Contributions for 2022 and 2023 were set at 10% of base salary.
The Executive Directors are employed under service contracts requiring six months’ notice by either party. Non-Executive Directors and the Chairman receive payments under
appointment letters which are terminable by three months’ notice by either party. The service contracts of the Non-Executive Directors are made available for inspection on request.
Futura Medical plc Annual Report 2023 | 51
REMUNERATION COMMITTEE REPORT
Element and Purpose
Operation
Maximum Level
Variable Remuneration
Annual Bonus
Rewards performance over the
financial year, including in relation
to performance which supports the
Group’s longer-term objectives.
Awards for Executive Directors are based on performance, measured
over the financial year to which they relate, and split between
strategic and corporate, and individual objectives split 90% and 10%
respectively.
The maximum annual bonus level in 2021 and 2022 was 50% of base
salary and following a remuneration/benchmark review in 2023 was
80% of salary. Any bonus is granted on a discretionary basis.
Annual Share Options Awards
To create alignment between
Executive Directors’ and shareholders’
interests through annual share
options issued through the approved
and unapproved share options
schemes.
Long-term Incentive Plan (“LTIP”)
To create alignment between
Executive Directors’ and shareholders’
interests through the delivery of
performance-based awards.
Awards are made annually in the form of market value share options.
Vesting is subject to performance criteria being met and the
Directors remaining in office.
Share options are awarded in the form of nominal cost share options
with the quantum of options dependent on a target share price
achieved.
The schemes are overseen by the Remuneration Committee, which
recommends to the Board all grants of share options based on the
Remuneration Committee’s assessment of personal performance
and specifying the terms under which eligible individuals may be
invited to participate. The share options granted in 2023 will vest
three years from the date of grant providing the Executive Director
remains in office, or is not under notice, at the date of vesting.
In 2023, performance milestones were achieved, and the target share
price reached. The options granted will vest 25% immediately with a
further 25% vesting annually following the date of grant, subject to the
Executive Directors remaining in office at the date of vesting.
This LTIP scheme is now closed. The Board is considering the most
appropriate measure and timing to introduce a further scheme.
POLICY ON NON-EXECUTIVE DIRECTORS’ REMUNERATION
The Non-Executive Directors and the Chairman each receive a fee for their services
as a director, which is approved by the Board, mindful of the time commitment and
responsibilities of their roles and of current market rates for comparable organisations and
appointments. Non-Executive Directors and the Chairman are reimbursed for travelling
and other incidental expenses incurred on Group business in line with the Group
Expenses Policy.
The Board encourages the ownership of Futura shares by Executive and Non-Executive
Directors alike and in normal circumstances does not expect Directors to undertake
dealings of a short-term nature.
The Non-Executive Directors receive a proportion of their remuneration in the form of
shares. The quantum of shares is determined at the start of each calendar year based on
the average closing mid-price of the last ten trading days prior to the year-end. The award
for 2023 was settled in January 2024 by the issue of 43,500 shares at 51.50 pence per share.
The 2024 award has been determined at 27.10 pence per share and the Non-Executive
Directors will accrue these shares over 2024 and receive them, or such lower number as
have accrued if they leave the Group earlier, in January 2025.
The Board considers ownership of Futura shares by Non-Executive Directors as a
positive alignment of their interest with shareholders. The Board periodically reviews the
shareholdings of the Non-Executive Directors and will seek guidance from its advisers if,
at any time, it is concerned that a shareholding may, or could appear to, conflict with their
duties as an independent Non-Executive Director of the Group.
Futura Medical plc Annual Report 2023 | 52
REMUNERATION COMMITTEE REPORT
DIRECTORS’ EMOLUMENTS
The emoluments of the Directors, who represent the key management personnel were as follows, in 2023:
Salary and
Directors’ Fees
Bonus
Share Awards
Benefits in Kind
Pension
Year ended 31 December 2023
£
277,407
200,000
205,000
41,853
53,947
39,000
817,207
£
183,600
144,000
147,600
–
–
–
475,200
£
–
–
–
29,302
13,000
13,000
55,302
£
8,547
–
1,685
–
–
–
10,232
£
–
–
20,500
–
–
–
20,500
Total
£
469,554
344,000
374,785
71,155
66,947
52,000
1,378,441
Year ended 31
December 2022
£
435,059
284,594
310,799
97,067
53,125
50,000
1,230,644
James Barder
Ken James
Angela Hildreth
Non-Executive Directors
John Clarke*
Jeff Needham
Andrew Unitt
Totals
* John Clarke resigned July 2023.
The above fees and emoluments exclude reimbursed expenditure incurred in the conduct of Group business.
DIRECTORS’ INTERESTS IN SHARES
James Barder
John Clarke*
Ken James
Angela Hildreth
Jeff Needham
Andrew Unitt
Totals
31 December 2023
31 December 2022
Beneficial
Interests
Non-beneficial
Interests
1,323,472
–
299,581
142,857
27,961
38,496
1,832,367
117,500
–
–
–
–
–
117,500
Beneficial
Interests
1,323,472
795,100
299,581
142,857
20,612
26,526
2,608,148
Non-beneficial
Interests
117,500
–
–
–
–
–
117,500
* John Clarke resigned as a Director of the Group in July 2023. As such, his interests in shares are not required to be disclosed as at 31 December 2023.
Futura Medical plc Annual Report 2023 | 53
REMUNERATION COMMITTEE REPORT
DIRECTORS’ INTERESTS IN SHARE OPTIONS
The Board uses share options to align Directors and employees’ interests with those of shareholders in order to provide incentives and reward them based on improvements in Group
performance. Options granted to the Directors included options granted under the LTIP scheme and were as follows:
James Barder
Ken James
Angela Hildreth
John Clarke*
Totals
31 December 2023
31 December 2022
Options
Held
3,615,927
3,375,955
3,040,081
–
10,031,963
Share-based
Payment
Expense
386,893
341,500
330,191
–
1,058,584
Options
Held
2,085,716
1,945,227
1,508,340
463,343
6,002,626
Share-based
Payment
Expense
100,119
87,113
83,789
42,846
313,867
* John Clarke resigned as a Director of the Group in July 2023. As such, his interests in share options are not required to be disclosed as at 31 December 2023.
All share options were granted with an exercise price at or above market value on the date of grant. The main vesting condition of the share options is that the Director remains
employed with the Group as at the date of exercise or continues to provide consultancy services as at the date of exercise. The share options of the Directors under the Futura Medical
plc Enterprise Management Incentive Scheme are set out below:
James Barder
James Barder
James Barder
James Barder
Ken James
Ken James
Ken James
Angela Hildreth
Angela Hildreth
Angela Hildreth
Angela Hildreth
Angela Hildreth
Totals
Grant Date
Number Awarded
Exercise Price/Share
17 September 2019
21 September 2020
5 October 2021
6 April 2023
12 September 2017
19 November 2018
17 September 2019
19 November 2018
17 September 2019
21 September 2020
5 October 2021
14 September 2022
250,000
300,000
94,322
43,000
200,000
200,000
200,000
200,000
200,000
240,000
264,000
79,425
2,270,747
31.00 pence
15.50 pence
37.90 pence
43.60 pence
30.50 pence
7.50 pence
31.00 pence
7.50 pence
31.00 pence
15.50 pence
37.90 pence
45.00 pence
Earliest
Exercise Date
1 October 2021
1 October 2022
1 October 2023
1 April 2026
1 October 2019
1 October 2020
1 October 2021
1 October 2020
1 October 2021
1 October 2022
1 October 2023
1 October 2025
Expiry Date
30 September 2026
30 September 2027
30 September 2028
31 March 2033
30 September 2024
30 September 2025
30 September 2026
30 September 2025
30 September 2026
30 September 2027
30 September 2028
30 September 2030
Futura Medical plc Annual Report 2023 | 54
REMUNERATION COMMITTEE REPORT
The share options of the Directors under the Futura Medical plc Unapproved Option Scheme are set out below:
James Barder
James Barder
James Barder
James Barder
Ken James
Ken James
Ken James
Ken James
Angela Hildreth
Angela Hildreth
Totals
Grant Date
Number Awarded
Exercise Price/Share
Earliest Exercise Date
Expiry Date
12 September 2017
5 October 2021
14 September 2022
6 April 2023
21 September 2020
5 October 2021
14 September 2022
6 April 2023
14 September 2022
6 April 2023
250,000
235,678
165,000
287,000
240,000
264,000
132,000
264,000
52,575
264,000
2,154,253
30.50 pence
37.90 pence
45.00 pence
43.60 pence
15.50 pence
37.90 pence
45.00 pence
43.60 pence
45.00 pence
43.60 pence
1 October 2019
1 October 2023
1 October 2025
1 April 2026
1 October 2022
1 October 2023
1 October 2025
1 April 2026
1 October 2025
1 April 2026
30 September 2024
30 September 2028
30 September 2030
31 March 2033
30 September 2027
30 September 2028
30 September 2030
31 March 2033
30 September 2030
31 March 2033
DIRECTORS’ INTERESTS IN LONG-TERM INCENTIVE PLAN
Some performance milestones, which are non-market-related milestones, were met in 2022. The options granted will vest 25% immediately with a further 25% vesting annually following
the date of grant. In 2022, a performance milestone was met at the target share price and the following number of share options were granted:
Grant Date
Number Awarded
Exercise Price/Share
Earliest Exercise Date
Expiry Date
James Barder
Ken James
Angela Hildreth
John Clarke
Totals
7 December 2022
7 December 2022
7 December 2022
7 December 2022
540,716
509,227
472,340
463,343
1,985,626
0.2 pence
0.2 pence
0.2 pence
0.2 pence
10 January 2023
10 January 2023
10 January 2023
10 January 2023
30 September 2030
30 September 2030
30 September 2030
30 September 2030
Some performance milestones, which are non-market-related milestones, were met in 2023. The options granted will vest 25% immediately with a further 25% vesting annually following
the date of grant. In 2023, a performance milestone was met at the target share price and the following number of share options were granted:
James Barder
Ken James
Angela Hildreth
Totals
10 October 2023
10 October 2023
10 October 2023
1,450,211
1,366,728
1,267,742
4,084,681
0.2 pence
0.2 pence
0.2 pence
10 October 2023
10 January 2023
10 January 2023
Grant Date
Number Awarded
Exercise Price/Share
Earliest Exercise Date
Expiry Date
30 October 2033
30 October 2033
30 October 2033
A share-based remuneration charge has been included in the Consolidated Statement of Comprehensive Loss in respect of the Approved Share Option scheme, Unapproved Share
Option scheme and the LTIP scheme.
ROY DAVIS
Chairman of the Remuneration Committee
Futura Medical plc Annual Report 2023 | 55
DIRECTORS’ REPORT
DIRECTORS
The Directors during the year were:
John Clarke
Non-Executive Chairman1
Jeff Needham
Non-Executive Director/Non-Executive
Chairman2
Andrew Unitt
Non-Executive Director
James Barder
Chief Executive Officer
Report. The Directors do not recommend the payment of a
dividend (2022: £nil).
DIRECTORS’ INTERESTS
The Directors’ interests in the Company’s shares
and options over ordinary shares are shown in the
Remuneration Committee Report on pages 50 to 55.
No Director has any beneficial interest in the share
capital of any subsidiary or associate undertaking.
Angela Hildreth
Finance Director/Chief Operating Officer
DIRECTORS’ REMUNERATION
Ken James
Head of R&D/Executive Director
1 Resigned July 2023.
2 Appointment to Non-Executive Chairman July 2023.
GENERAL INFORMATION
Futura Medical plc is a public limited company
incorporated in the United Kingdom, registered number
04206001, which is listed on the Alternative Investment
Market (“AIM”) of the London Stock Exchange.
REVIEW OF BUSINESS
The Group continues to invest in the development
of innovative and proprietary sexual health products,
utilising its expertise in the research, development and
commercialisation of topically delivered gel formulations
to improve sexual health. The Strategic Report on pages
2 to 37 provides a review of the business, including the
Group’s trading for the year ended 31 December 2023, an
indication of likely future developments, key performance
indicators and risks.
DIVIDENDS
The Group has reported its consolidated financial
statements in accordance with International Financial
Reporting Standards (“IFRSs”) as adopted by the UK. The
results for the year and financial position of the Company
and the Group are set out in the financial statements
and reviewed in the Financial Review within the Strategic
Details of the Directors’ remuneration appear in the
Remuneration Committee Report on pages 50 to 55.
DIRECTORS’ AND OFFICERS’ LIABILITY
INSURANCE
The Company has, as permitted by the Companies
Act 2006, maintained insurance cover on behalf of the
Directors, indemnifying them against certain liabilities
which may be incurred by them in relation to the
Company.
POLITICAL DONATIONS
The Group made no political donations during the current
or prior year.
FINANCIAL INSTRUMENTS – RISK MANAGEMENT
The Group’s financial risk management policy is set out in
Note 4 to the financial statements.
RESEARCH AND DEVELOPMENT (“R&D”)
During the year ended 31 December 2023 the Group’s
expenditure on R&D was £2,045,988 (2022: £4,131,224).
ADEQUACY OF INFORMATION SUPPLIED TO
EXTERNAL AUDITOR
Each Director who held office at the date of approval of
this Report confirms that, so far as the Director is aware,
there is no relevant audit information of which the
Company’s External Auditor is unaware and the Director
has taken all the steps that he or she ought to have
taken as a Director to make himself or herself aware of
any relevant audit information and to establish that the
Company’s External Auditor is aware of that information.
This confirmation is given and should be interpreted
in accordance with the provisions of section 418 of the
Companies Act 2006.
The Directors confirm that:
• so far as each Director is aware, there is no relevant
audit information of which the Company’s Auditor is
unaware; and
• the Directors have taken all the steps that they ought
to have taken as Directors in order to make themselves
aware of any relevant audit information and to establish
that the Company’s Auditor is aware of that information.
CHANGE OF CONTROL PROVISIONS
There are some agreements that may take effect, alter or
terminate on a change of control of the Company, such as
commercial contracts, property leases and share option
schemes. None of these are considered to be significant in
their likely impact on the business as a whole.
STATEMENT OF ENGAGEMENT WITH SUPPLIERS,
CUSTOMERS AND OTHERS IN A BUSINESS
RELATIONSHIP WITH THE COMPANY
The Directors are mindful of their statutory duty to act
in the way they each consider, in good faith, would be
most likely to promote the success of the Company for
the benefit of its members as a whole, as set out in our
s.172(1) statement on page 31. A consideration of the
Company's relationship with wider stakeholders, including
manufacturers and commercial partners, is disclosed in
the Stakeholders section on pages 31 to 33.
Futura Medical plc Annual Report 2023 | 56
DIRECTORS’ REPORT
SIGNIFICANT INTERESTS
On 9 April 2024 the Company was notified of the following
shareholders with 3% or more of the issued share capital of
the Company in accordance with the Disclosure Guidance
and Transparency rules:
Lombard Odier Asset Management
(Europe) Limited
T Adams
WT Lamb Investments Limited
RA Lamb
28.50%
6.89%
4.51%
3.28%
Most recently notified details of significant shareholdings
may be found in the Investor section of our website, at
www.futuramedical.com.
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
IN RESPECT OF THE ANNUAL REPORT AND THE
FINANCIAL STATEMENTS
The Directors are responsible for preparing the Annual
Report and the Group and Parent Company financial
statements in accordance with applicable law and
regulations. Company law requires the Directors to prepare
Group and Parent Company financial statements for each
financial year. Under the AIM Rules of the London Stock
Exchange they are required to prepare the Group financial
statements in accordance with UK-adopted International
Accounting Standards (IFRSs as adopted by the UK) and
applicable law and they have elected to prepare the Parent
Company financial statements in accordance with UK
accounting standards and applicable law (UK Generally
Accepted Accounting Practice), including FRS 101 Reduced
Disclosure Framework.
Under company law the Directors must not approve
the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of
the Group and Parent Company and of their profit or
loss for that period. In preparing each of the Group and
Parent Company financial statements, the Directors are
required to:
• select suitable accounting policies and then apply them
consistently;
• make judgements and estimates that are reasonable,
relevant, reliable and prudent;
• state whether they have been prepared in accordance
with UK-adopted International Accounting Standards;
• for the Parent Company financial statements, state
whether applicable UK accounting standards have been
followed, subject to any material departures disclosed
and explained in the financial statements;
• assess the Group and Parent Company’s ability to
continue as a going concern, disclosing, as applicable,
matters related to going concern; and
• use the going concern basis of accounting unless
they either intend to liquidate the Group or the Parent
Company or to cease operations, or have no realistic
alternative but to do so.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain the Parent Company’s transactions and disclose
with reasonable accuracy at any time the financial
position of the Parent Company and enable them to
ensure that its financial statements comply with the
Companies Act 2006. They are responsible for such internal
control as they determine is necessary to enable the
preparation of financial statements that are free from
material misstatement, whether due to fraud or error,
and have general responsibility for taking such steps as
are reasonably open to them to safeguard the assets of
the Group and to prevent and detect fraud and other
irregularities.
The Directors have also decided to prepare voluntarily
a Corporate Governance Statement as if the Company
were required to comply with the Listing Rules and the
Disclosure Guidance and Transparency Rules of the
Financial Conduct Authority in relation to those matters.
Under applicable law and regulations, the Directors are
also responsible for preparing a Strategic Report and a
Directors’ Report that comply with that law and those
regulations.
We consider the Annual Report and Accounts, taken as a
whole, are fair, balanced and understandable and provide the
information necessary for shareholders to assess the Group’s
position and performance, business model and strategy.
GOING CONCERN
The Directors believe that it remains appropriate to
prepare the financial statements on a going concern
basis. However, they also acknowledge that a material
uncertainty exists that may cast significant doubt on
the Group’s ability to generate sufficient net revenues
and resulting cash inflows and raise sufficient finance to
meet its expected costs to discharge its liabilities in the
normal course of business. The financial statements do not
include any adjustments that would result from the basis
of preparation being inappropriate. Further details can be
found in Note 2.2.
WEBSITE PUBLICATION
The Directors are responsible for the maintenance and
integrity of the corporate and financial information
included on the Company’s website. Legislation in
the United Kingdom governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.
The Directors have decided to prepare voluntarily
a Remuneration Committee Report in accordance
with Schedule 8 to The Large and Medium-sized
Companies and Groups (Accounts and Reports)
Regulations 2008 made under the Companies Act
2006, as if those requirements applied to the Company.
By order of the Board
ANGELA HILDRETH
Company Secretary
9 April 2024
Futura Medical plc Annual Report 2023 | 57
Financial
Statements
CONTENTS
FINANCIAL STATEMENTS
Independent Auditor’s Report to the Members of
Futura Medical plc
Consolidated Statement of Comprehensive Loss
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Parent Company Balance Sheet
Parent Company Statement of Changes in Equity
Notes to the Parent Company Financial Statements
Company information
59
67
68
69
70
71
87
88
89
91
Futura Medical plc Annual Report 2023 | 58
Independent Auditor’s Report to the Members of Futura Medical plc
for the year ended 31 December 2023
OPINION
BASIS FOR OPINION
Our opinion on the financial statements is
unmodified
We have audited the financial statements of Futura
Medical Plc (the ‘parent company’) and its subsidiaries
(the ‘group’) for the year ended December 31, 2023,
which comprise the Consolidated statement of
comprehensive loss, the Consolidated statement of
changes in equity, the Consolidated statement of
financial position, the Consolidated statement of cash
flows, the Parent company balance sheet, the Parent
Company statement of changes in equity and notes
to the financial statements, including a summary of
significant accounting policies.
The financial reporting framework that has been applied
in the preparation of the group financial statements is
applicable law and UK-adopted international accounting
standards. The financial reporting framework that has
been applied in the preparation of the parent company
financial statements is applicable law and United
Kingdom Accounting Standards, including Financial
Reporting Standard 101 ‘Reduced Disclosure Framework
(United Kingdom Generally Accepted Accounting
Practice).
In our opinion:
• the financial statements give a true and fair view of
the state of the group’s and of the parent company’s
affairs as at December 31, 2023 and of the group’s loss
for the year then ended;
• the group financial statements have been properly
prepared in accordance with UK adopted international
accounting standards;
• the parent company financial statements have
been properly prepared in accordance with
United Kingdom Generally Accepted Accounting
Practice; and
• the financial statements have been prepared in
accordance with the requirements of the Companies
Act 2006.
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further
described in the ‘Auditor’s responsibilities for the audit
of the financial statements’ section of our report. We
are independent of the group and the parent company
in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the
UK, including the FRC’s Ethical Standard as applied to
listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
opinion.
MATERIAL UNCERTAINTY RELATED
TO GOING CONCERN
We draw attention to note 2.2 in the consolidated financial
statements, which indicates the risks of the Group’s ability
to continue as a going concern due to the uncertainty
around the Group’s ability to generate sufficient net
revenues and resulting cash inflows and raise sufficient
finance to meet its expected costs to discharge its
liabilities in the normal course of business. As stated in
note 2.2, these events or conditions, along with the other
matters as set forth in going concern note, indicate that a
material uncertainty exists that may cast significant doubt
on the company’s ability to continue as a going concern.
Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded
that the director’s use of the going concern basis of
accounting in the preparation of the financial statements
is appropriate.
Our evaluation of management’s assessment of the
entity’s ability to continue as a going concern
Our evaluation of the directors’ assessment of the group’s
and the parent company’s ability to continue to adopt the
going concern basis of accounting included obtaining
management’s going concern assessments covering
the period to 30 June 2025 and performing the following
procedures:
• obtaining an understanding of relevant controls over
management’s going concern models, including those
over the inputs and assumptions used in the models;
• corroborating key assumptions, such as assessing the
timing and quantity of future sales, increases of costs in
line with inflation, delays in R&D tax credit receipts and
challenging management where necessary;
• assessing the impact of not achieving expected revenue
and evaluating the impact of a reduced revenue
scenario. We considered whether the assumptions are
consistent with our understanding of the business and
other audit work undertaken;
• assessing the impact of the mitigating factors available
to management in respect of the ability to reduce
expenditure through cost saving exercises, such
as reducing bonus payments and R&D expense, or
alternative options;
• assessing the accuracy of management’s past
forecasting by comparing management’s future
forecasts modelled in the two prior financial years to the
actual results for that relevant year and considering the
impact on the going concern models;
• evaluating events that occurred post balance sheet date
and challenging management as to whether these have
been correctly reflected in the forecasts prepared;
• assessing management’s sensitivity analysis on
the going concern models and considering if they
appropriately consider reasonably possible adverse
movements; and
• assessing the adequacy of related disclosures within the
annual report and accounts.
Futura Medical plc Annual Report 2023 | 59
Independent Auditor’s Report to the Members of Futura Medical plc
for the year ended 31 December 2023
Our responsibilities
We are responsible for concluding on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on the group’s and the parent company’s ability to continue as a going concern. If we conclude that
a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the
auditor’s opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause the group or the parent
company to cease to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
OUR APPROACH TO THE AUDIT
OVERVIEW OF OUR AUDIT APPROACH
Overall materiality:
Group: £329,000, which represents approximately 5% of the group’s loss before tax.
Parent company: £720,000, which represents approximately 1% of the parent company’s total assets.
Key audit matters were identified as
Materiality
Key audit
matters
Group: In addition to the matter described in the Material uncertainty related to going concern section, we have determined the matter(s)
described below to be the key audit matter(s) to be communicated in our report: Revenue Recognition from License Income (new in current
year).
Parent: Except for the matter described in the Material uncertainty related to going concern section, we have determined that there are no
other key audit matters to be communicated in our report.
Scoping
Our auditor’s report for the year ended 31 December 2022 included one key audit matter that has not been reported as key audit matter in
our current year’s report. This relates to Impairment of investment in the subsidiary as market uncertainty with respect to the potential of
MED3000 has resolved post the EU and US FDA approval and revenue generation.
We performed a full-scope audit on the Parent Company and the other significant component (Futura Medical Developments Limited) using
component materiality. 100% of the revenue and loss before tax for the year ended 31 December 2023 and 100% of the assets and liabilities as at
31 December 2023 were included within full-scope audit procedures. This approach is the same as the previous year.
Futura Medical plc Annual Report 2023 | 60
Independent Auditor’s Report to the Members of Futura Medical plc
for the year ended 31 December 2023
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) that we identified. These matters included those that had the greatest effect on: the overall
audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters
were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters.
In the graph below, we have presented the key audit matters, significant risks and other risks relevant to the audit.
Description
Audit response
KAM
High
l
i
a
c
n
a
n
fi
l
a
i
t
n
e
t
o
P
t
c
a
p
m
i
t
n
e
m
e
t
a
t
s
Low
Low
Existence of cash and
cash equivalents
Impairment of investments
(Parent only)
Going
concern
Revenue – Sale of product
Revenue recognition –
License contract
Disclosures
Our results
Completeness and accuracy
of accrued bonus expense
Management override
of controls
Capitalisation of R&D
expense
Accuracy and existence
of tax receivable
Accounting for new share
options issued in year
Extent of management judgement
High
Key audit matter
Significant risk
Other risk
Futura Medical plc Annual Report 2023 | 61
Independent Auditor’s Report to the Members of Futura Medical plc
for the year ended 31 December 2023
Key Audit Matter – Group
Revenue – License Contract
We identified revenue recognition for license contract as one of the most significant
assessed risks of material misstatement due to fraud and error.
Revenue is the most significant item in the Consolidated Statement of Loss and is a
key performance indicator as set out in the Annual Report and Financial Statements.
Revenue is recognised in accordance with International Financial Reporting Standard
(IFRS) 15 ‘Revenue from Contracts with Customers’ and requires judgement in
identification of performance obligations.
In the current year, the company entered a new contract with Haleon plc (“Haleon”) for
commercialisation of the product in USA. We determined that the significant risk in
revenue relates to the identification of the performance obligations within this contract
and the timing of the recognition of the license fee revenue. There were also judgements
required in determining whether the contract included an embedded lease.
Relevant disclosures in the Annual Report
• Financial statements: Note 2.6,
How our scope addressed the matter – Group
In responding to the key audit matter, we performed the following audit procedures:
• obtained and assessed the management expert’s assessment for evaluation of the
accounting treatment of the contract;
• evaluated whether the accounting policies adopted are in accordance with IFRS 15,
including the identification of a performance obligation. As part of testing performed,
assessed whether the policies had been applied consistently;
• assessed whether the accounting policies adopted are in accordance with IFRS 16,
including the assessment of whether the license contract contains an embedded lease;
• assessed the competence and objectivity of managements expert used to assist in
evaluation of the new contract;
• assessed the completeness and accuracy of the contract liability associated with the
performance obligation in the contract;
• considered the appropriateness of management judgements and rationale; and
• obtained an understanding of the relevant controls through with the business initiates,
records and recognised revenue and contract liability under this contract.
Our results
Based on our audit work, we did not identify any material misstatements with respect
to the revenue recognition of the new license contract. Revenue was recognised in
accordance with the group’s accounting policy and IFRS 15 ‘Revenue from Contracts with
Customers’.
We did not identify any key audit matters relating to the audit of the financial statements of the parent company only.
Futura Medical plc Annual Report 2023 | 62
Independent Auditor’s Report to the Members of Futura Medical plc
for the year ended 31 December 2023
OUR APPLICATION OF MATERIALITY
We apply the concept of materiality both in planning and performing the audit, and in evaluating the effect of identified misstatements on the audit and of uncorrected misstatements,
if any, on the financial statements and in forming the opinion in the auditor’s report.
Materiality was determined as follows:
Materiality measure
Group
Parent company
Materiality for
financial statements
as a whole
We define materiality as the magnitude of misstatement in the financial statements that, individually or in the aggregate, could reasonably be expected
to influence the economic decisions of the users of these financial statements. We use materiality in determining the nature, timing and extent of our
audit work.
Materiality threshold
£329,000, which represents approximately 5% of loss before tax.
£720,000, which represents approximately 1% of total assets of company
Significant
judgements made by
auditor in determining
materiality
In determining materiality, we made the following significant judgements:
• The group’s loss before tax is considered the most appropriate benchmark
because it is a prominent key performance measure for the users of the
financial statement;
In determining materiality, we made the following significant judgements:
• The company’s total assets are considered the most appropriate
benchmark because its principal activity is that of a holding company,
with the largest financial statement line items being investments;
• 5% was deemed to be an appropriate measurement percentage to
take into account the additional risk of being listed and the associated
shareholder expectations. The percentage is in line with the prior year.
Materiality for the current year is higher than the level that we determined
for the year ended 31 December 2022 to reflect increase in loss before tax.
Materiality for the current year is higher than the level that we determined
for the year ended 31 December 2022 to reflect increase in assets.
We set performance materiality at an amount less than materiality for the financial statements as a whole to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected misstatements exceeds materiality for the financial statements as a whole.
£230,300, which is 70% of financial statement materiality.
£504,000, which is 70% of financial statement materiality.
In determining performance materiality, we made the following significant
judgements:
• Our understanding of the entity, updated during the performance of risk
In determining performance materiality, we made the following significant
judgements:
• Our understanding of the entity, updated during the performance of risk
assessment procedures; and
assessment procedures; and
• Our experience with auditing the financial statements of the group in
previous years including the number of misstatements identified.
• Our experience with auditing the financial statements of the parent
company in previous years, including the number of misstatements
identified.
Performance
materiality used to
drive the extent of
our testing
Performance
materiality threshold
Significant
judgements made by
auditor in determining
performance
materiality
Specific materiality
We determine specific materiality for one or more particular classes of transactions, account balances or disclosures for which misstatements of lesser
amounts than materiality for the financial statements as a whole could reasonably be expected to influence the economic decisions of users taken on the
basis of the financial statements.
Futura Medical plc Annual Report 2023 | 63
Independent Auditor’s Report to the Members of Futura Medical plc
for the year ended 31 December 2023
Materiality measure
Group
Parent company
Specific materiality
Communication of
misstatements to the
audit committee
We determined a lower level of specific materiality for the following areas:
• Directors Remuneration; and
• Related party transactions.
We determine a threshold for reporting unadjusted differences to the audit committee
Threshold for
communication
£16,500 and misstatements below that threshold that, in our view, warrant
reporting on qualitative grounds.
£36,000 and misstatements below that threshold that, in our view, warrant
reporting on qualitative grounds.
The graph below illustrates how performance materiality interacts with our overall materiality and the threshold for communication to the audit committee.
Overall materiality – Group
Overall materiality – Parent
Loss before tax
£6,891,973
FSM
£329,000
5%
PM
£230,000
70%
TfC
£16,500
5%
Total assets
£74,088,381
FSM
£720,000
1%
PM
£504,000
70%
TfC
£36,000
5%
FSM: Financial statement materiality
PM: Performance materiality
TfC: Threshold for communication to the audit committee
AN OVERVIEW OF THE SCOPE OF OUR AUDIT
We performed a risk-based audit that requires an understanding of the group’s and the parent company’s business and in particular matters related to:
Understanding the group, its components, and their environments, including group-wide controls
• We evaluated the group’s internal control environment and documented our understanding of controls relevant to the audit.
• We evaluated IT systems and controls. ISA (UK) 315 (Revised July 2020) requires us to consider the risks arising from the use of IT and the entity’s ITGCs related to each internal control
relevant to the audit.
• We performed process walkthroughs and documented and assessed, the relevant controls covering the Key Audit Matters and certain other risks in the financial reporting system
identified as part of our risk assessment.
• The processes and systems are centralised and as such our understanding of the Group’s controls are the same for all components.
Futura Medical plc Annual Report 2023 | 64
Independent Auditor’s Report to the Members of Futura Medical plc
for the year ended 31 December 2023
Identifying significant components
We identified the significant components of the group
based on the relative contribution of revenue, loss before
tax and net assets of each component to the group.
Type of work to be performed on financial information
of parent and other components (including how it
addressed the key audit matters)
We performed a full scope audit on the financial
statements of Futura Medical plc and Futura Medical
Developments Limited.
We tested the consolidation process and carried out
analytical procedures on the financial statements of
Futura Medical Healthcare Limited to confirm that there
were no significant risks of material misstatement of
the aggregated financial information of the remaining
component.
Performance of our audit
Our responsibility is to read the other information and,
in doing so, consider whether the other information is
materially inconsistent with the financial statements or
our knowledge obtained in the audit or otherwise appears
to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we
are required to determine whether there is a material
misstatement in the financial statements themselves. If,
based on the work we have performed, we conclude that
there is a material misstatement of this other information,
we are required to report that fact.
We have nothing to report in this regard.
OUR OPINION ON OTHER MATTERS
PRESCRIBED BY THE COMPANIES ACT 2006
IS UNMODIFIED
In our opinion, based on the work undertaken in the
course of the audit:
The year-end audit was conducted through a mixture of
remote and onsite working. This was supported through
the use of software collaboration platforms for the secure
and timely delivery of requested audit evidence.
the information given in the strategic report and the
directors’ report for the financial year for which the
financial statements are prepared is consistent with the
financial statements; and
100% of the Group’s revenue, Group’s total assets, Group’s
total liabilities and of the Group’s loss before tax were
included in the scope of our full scope audit procedures.
the strategic report and the directors’ report have
been prepared in accordance with applicable legal
requirements.
Changes in approach from previous period
There are no changes in the scope of the current year audit
form the scope of that of prior year.
OTHER INFORMATION
The other information comprises the information included
in the annual report, other than the financial statements
and our auditor’s report thereon. The directors are
responsible for the other information contained within the
annual report. Our opinion on the financial statements
does not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do not
express any form of assurance conclusion thereon.
MATTER ON WHICH WE ARE REQUIRED TO
REPORT UNDER THE COMPANIES ACT 2006
In the light of the knowledge and understanding of the
group and the parent company and their environment
obtained in the course of the audit, we have not identified
material misstatements in the strategic report or the
directors’ report.
MATTERS ON WHICH WE ARE REQUIRED TO
REPORT BY EXCEPTION
We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
• adequate accounting records have not been kept by the
parent company, or returns adequate for our audit have
not been received from branches not visited by us; or
• the parent company financial statements are not in
agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified
by law are not made; or
• we have not received all the information and
explanations we require for our audit.
RESPONSIBILITIES OF DIRECTORS
As explained more fully in the directors’ responsibilities
statement set out on pages 56–57, the directors are
responsible for the preparation of the financial statements
and for being satisfied that they give a true and fair view,
and for such internal control as the directors determine
is necessary to enable the preparation of financial
statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the group’s and the parent
company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless
the directors either intend to liquidate the group or the
parent company or to cease operations, or have no realistic
alternative but to do so.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT
OF THE FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is
not a guarantee that an audit conducted in accordance
with ISAs (UK) will always detect a material misstatement
when it exists.
Futura Medical plc Annual Report 2023 | 65
Independent Auditor’s Report to the Members of Futura Medical plc
for the year ended 31 December 2023
Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate,
they could reasonably be expected to influence the
economic decisions of users taken on the basis of these
financial statements.
Irregularities, including fraud, are instances of non-
compliance with laws and regulations. The extent to which
our procedures are capable of detecting irregularities,
including fraud, is detailed below:
• We obtained an understanding of the legal and
regulatory frameworks that are applicable to the
Group and Parent Company and determined that
the most significant which are directly relevant to the
financial statements are those related to the reporting
framework, being the Companies Act 2006, Financial
Reporting Standard 101 (for the Parent Company)
and UK-adopted international accounting standards,
together with the QCA Corporate Governance Code and
the AIM Rules for Companies. Other applicable legal and
regulatory frameworks include following EU Directive
2001/83/EC, being regulated, and licensed by the
medicines and healthcare products regulatory agency
(MHRA) and being ISO 13485 accredited.
• We obtained an understanding of how the Group is
complying with those legal and regulatory frameworks
by making enquiries of management. We corroborated
our enquiries through our review of board minutes and
correspondence received from regulatory bodies.
• We assessed the susceptibility of the financial
statements to material misstatement, including how
fraud might occur, by making enquiries of management
and those charged with governance. We utilised internal
and external information to corroborate these enquiries
and to perform a fraud risk assessment. We considered
the risk of fraud to be highest through the potential for
management override of controls. Our audit procedures
involved: − evaluation of the design and implementation
of controls that management has in place to prevent
and detect fraud; − journal entry testing, with a focus
on material manual journals, including those posted
directly to cash and those impacting areas of estimation
uncertainty; and − challenging assumptions and
judgements made by management in its significant
accounting estimates.
the classes of transactions, account balances, expected
financial statement disclosures and business risks that
may result in risks of material misstatement.
• In addition, we completed audit procedures to conclude
on the compliance of disclosures in the annual report
and accounts with applicable financial reporting
requirements.
• These audit procedures were designed to provide
reasonable assurance that the financial statements
were free from fraud or error. The risk of not detecting
a material misstatement due to fraud is higher than
the risk of not detecting one resulting from error
and detecting irregularities that result from fraud is
inherently more difficult than detecting those that result
from error, as fraud may involve collusion, deliberate
concealment, forgery or intentional misrepresentations.
Also, the further removed non-compliance with laws and
regulations is from events and transactions reflected
in the financial statements, the less likely we would
become aware of it;
• The engagement partners assessed the appropriateness
of the collective competence and capabilities of the
engagement team, including consideration of the
engagement team’s:
• understanding of, and practical experience with, audit
engagements of a similar nature and complexity,
through appropriate training and participation;
• knowledge of the industry in which the group
operate; and
• understanding of the legal and regulatory
requirements specific to the Group and Parent
Company.
• Team communications in respect of potential non-
compliance with laws and regulations and fraud
included the potential for fraud in revenue recognition
through manipulation of the identified performance
obligations in contracts. In assessing the potential risks
of material misstatement we obtained an understanding
of the Group’s operations, including the nature of its
revenue sources, products and services to understand
A further description of our responsibilities for
the audit of the financial statements is located
on the Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.
USE OF OUR REPORT
This report is made solely to the company’s members,
as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the company’s members
those matters we are required to state to them in an
auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume
responsibility to anyone other than the company and the
company’s members as a body, for our audit work, for this
report, or for the opinions we have formed.
JONATHAN OAKEY FCA
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
Crawley
9 April 2024
Futura Medical plc Annual Report 2023 | 66
Consolidated Statement of Comprehensive Loss
for the year ended 31 December 2023
Revenue
Cost of sales
Gross Profit
Research and development costs
Administrative expenses
Operating loss
Finance income
Loss before tax
Taxation recoverable
Loss for the year being total comprehensive loss attributable to owners of the Parent Company
Basic and diluted loss per share (pence)
All amounts relate to continuing activities.
The Notes on pages 71 to 86 form part of these consolidated financial statements.
Year ended
31 December
2023
£
3,100,968
(1,326,743)
1,774,225
(2,045,988)
(6,692,007)
(6,963,770)
71,797
(6,891,973)
379,074
Year ended
31 December
2022
£
–
–
–
(4,131,224)
(2,740,265)
(6,871,489)
–
(6,871,489)
1,024,994
(6,512,899)
(5,846,495)
(2.21)
(2.03)
Notes
5
6
8
9
Futura Medical plc Annual Report 2023 | 67
Consolidated Statement of Financial Position
as at 31 December 2023
Assets
Non-current assets
Plant and equipment
Total non-current assets
Current assets
Inventories
Trade and other receivables
Current tax asset
Cash and cash equivalents
Total current assets
Liabilities
Current liabilities
Trade and other payables
Total liabilities
Total net assets
Capital and reserves attributable to owners of the Parent Company
Share capital
Share premium
Merger reserve
Warrant reserve
Retained losses
Total equity
By order of the Board
JAMES BARDER
Chief Executive Officer
Registered number: 04206001
As at
31 December
2023
£
As at
31 December
2022
£
Notes
10
12
8
13
14
16
18
2,484,748
2,484,748
1,158,035
1,158,035
339
1,240,174
376,910
7,714,182
9,331,605
–
265,684
1,022,831
4,026,112
5,314,627
(6,339,534)
(6,339,534)
5,476,819
(1,753,109)
(1,753,109)
4,719,553
602,812
71,068,945
1,152,165
–
(67,347,103)
5,476,819
576,093
66,545,796
1,152,165
165,868
(63,720,369)
4,719,553
Futura Medical plc Annual Report 2023 | 68
Consolidated Statement of Changes in Equity
for the year ended 31 December 2023
At 1 January 2022
Total comprehensive loss for the year
Share-based payment
Shares issued during the year
Transactions with owners
At 31 December 2022
Total comprehensive loss for the year
Share-based payment
Shares issued during the year
Warrant exercise
Transactions with owners
At 31 December 2023
Notes
17
16
17
16
18
Share
Capital
£
574,302
–
–
1,791
1,791
576,093
–
–
4,844
21,875
26,719
Share
Premium
£
66,378,003
–
–
167,793
167,793
66,545,796
–
–
170,024
4,353,125
4,523,149
602,812
71,068,945
Merger
Reserve
£
1,152,165
–
–
–
–
1,152,165
–
–
–
–
–
1,152,165
Warrant
Reserve
£
Retained
Losses
£
165,868 (58,545,726)
(5,846,495)
671,852
–
671,852
–
–
–
–
165,868 (63,720,369)
(6,512,899)
2,720,297
–
165,868
2,886,165
–
–
–
(165,868)
(165,868)
Total
Equity
£
9,724,612
(5,846,495)
671,852
169,584
841,436
4,719,553
(6,512,899)
2,720,297
174,868
4,375,000
7,270,165
–
(67,347,103)
5,476,819
The merger reserve represents the reserve arising on the acquisition of Futura Medical Developments Limited in 2001 via a share for share exchange accounted for as a group
reconstruction previously using merger accounting under UK GAAP.
Retained losses represent all other net gains and losses not recognised elsewhere.
Share premium represents amounts subscribed for share capital in excess of nominal value, less the related costs of share issues.
Warrants issued are held as a separate ‘warrant reserve’ within equity. These warrants were exercised in 2023 and the warrant reserve was transferred to retained earnings.
Please refer to Note 18.
The Notes on pages 71 to 86 form part of these consolidated financial statements.
Futura Medical plc Annual Report 2023 | 69
Consolidated Statement of Cash Flows
for the year ended 31 December 2023
Cash flows from operating activities
Loss before tax
Adjustments for:
Depreciation
Loss on disposal of fixed assets
Finance income
Share-based payment charge
Cash flows used in operating activities before changes in working capital
(Increase) in inventories
(Increase) in trade and other receivables
Increase/(decrease) in trade and other payables
Cash generated by/(used in) operations
Income tax received
Net cash generated/(used) in operating activities
Cash flows from investing activities
Purchase of plant and equipment
Interest received
Cash used in investing activities
Cash flows from financing activities
Issue of ordinary shares
Exercise of warrants
Cash generated by financing activities
Increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Net foreign exchange differences
Cash and cash equivalents at end of year
The Notes on pages 71 to 86 form part of these consolidated financial statements.
Year ended
31 December
2023
£
Year ended
31 December
2022
£
Notes
(6,891,973)
(6,871,489)
130,272
48,865
(71,797)
2,720,297
(4,064,336)
24,734
585
–
671,852
(6,174,318)
(339)
(974,490)
4,586,424
(452,741)
–
(186,429)
(325,075)
(6,685,822)
1,022,994
570,253
910,476
(5,775,346)
(1,505,849)
71,797
(1,434,052)
(740,697)
–
(740,697)
174,868
4,375,000
4,549,868
3,686,069
4,026,112
2,001
7,714,182
169,584
–
169,584
(6,346,459)
10,372,571
–
4,026,112
10
17
12
14
10
16
18
13
Futura Medical plc Annual Report 2023 | 70
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
1. CORPORATE INFORMATION
Futura Medical plc (the “Company”) is a public limited
company incorporated and domiciled in England and
Wales and whose shares are publicly traded on the AIM
Market of the London Stock Exchange. The registered
office is located at Surrey Technology Centre, 40 Occam
Road, Guildford, Surrey, GU2 7YG.
These Group financial statements consolidate those of the
Company and its subsidiaries (together referred to as “the
Group” and individually as “Group entities”) for the year
ended 31 December 2023.
The consolidated financial statements of the Company
and the Group for the year ended 31 December 2023
were authorised for issue by the Board of Directors on
9 April 2024.
The Group is principally engaged in the development and
sale of consumer healthcare products.
2. ACCOUNTING POLICIES
2.1 Basis of preparation
The consolidated financial statements have been prepared
on a going concern basis and under the historical cost
convention and have been prepared and approved by the
Directors in accordance with UK-adopted International
accounting standards (“IFRS”). The principal accounting
policies applied in the preparation of the consolidated
financial information are set out below. These policies have
been consistently applied to all years presented, unless
otherwise stated.
Monetary amounts in these financial statements
are rounded to the nearest pound sterling (£), unless
otherwise stated, which is also the functional currency of
the Company.
2.2 Going concern
The Board has considered the applicability of the
going concern basis in the preparation of the financial
statements. Notwithstanding a loss for the year ended
31 December 2023 of £6,512,899, the Board considers that,
based on the reasons set out below, the preparation of the
financial statements on a going concern basis remains
appropriate.
2.3 Standards, amendments and interpretation to
existing standards
In assessing the appropriateness of adopting the going
concern assumption, the Group has prepared a detailed
budget (“the budget”) for the period ending 31 December
2024 and a further forecast (“the forecast”) for the period
ending 30 June 2025.
The Board considers that the budget and the forecast
represent a reasonable best estimate of the Group’s
performance over the period to 30 June 2025 and the
Directors are satisfied that in the scenario modelled in the
budget and the forecast, the Group and Parent Company
would be able to continue as a going concern.
However, in preparing the budget and forecast, the Board
also noted the existence of a number of factors that
increase the difficulty inherent in predicting the Group’s
performance, in particular its revenue generation and
timing of key milestone payments. These include a lack of
any historical information from which to reliably predict
sales volume and growth and timing of receipts from
customers in respect of Eroxon® as the product continues
to launch in further key markets throughout FY24.
Forecasts provided by commercial partners continue to be
highly encouraging but are not guaranteed. In addition to
the budget and forecast, the Board therefore considered a
possible scenario in which Eroxon® revenues were reduced
compared to the budget and forecast (the “downside
scenario”). The Board further considered remedial action
within Management’s control to delay some discretionary
spending. In this downside scenario, after taking the
remedial actions, the Board believes that the Group’s
resources could still extend beyond June 2025.
The Board does not believe that the Group’s position
at this point in the execution of its strategy is unusual.
However, despite the mitigations available to the Group, it
acknowledges that a material uncertainty exists that may
cast significant doubt on the Group’s ability to generate
sufficient net revenues and resulting cash inflows and
raise sufficient finance to meet its expected costs and to
continue as a going concern and to realise its assets and
discharge its liabilities in the normal course of business.
On 1 January 2023, the Group adopted the following
amendments which are mandatorily effective for the
period beginning 1 January 2023:
• Disclosure of Accounting Policies (Amendments to IAS 1
and IFRS Practice Statement 2);
• Definition of Accounting Estimates (Amendments to
IAS 8);
• Deferred Tax Related to Assets and Liabilities arising
from a Single Transaction (Amendments to IAS 12);
• IFRS 17 – Insurance contracts; and
• International Tax Reform – Pillar Two Model Rules
(Amendments to IAS 12).
The adoption during the year of the amendments and
interpretations has not had a material impact on the
consolidated financial statements.
2.4 Basis of consolidation
The financial statements of the Group consolidate
the financial statements of Futura Medical plc and its
subsidiary undertakings (together referred to as the
“Group”) up to 31 December each year. All subsidiaries have
a reporting date of 31 December.
Subsidiaries are entities controlled by the Group.
Control exists when the Group has the power, directly or
indirectly, to govern the financial and operating policies
of an entity so as to obtain benefits from its activities. In
assessing control, potential voting rights that are currently
exercisable or convertible are taken into account. All
subsidiaries are 100% owned.
The financial statements of subsidiaries are included in
the consolidated financial statements from the date that
control commences until the date that control ceases,
in accordance with IFRS 10. Intra group transactions and
balances, and any unrealised gains or losses arising from
intra group transactions, are eliminated in preparing the
consolidated financial statements.
Futura Medical plc Annual Report 2023 | 71
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
2. ACCOUNTING POLICIES CONTINUED
Product revenue
2.5 Segment reporting
An operating segment is a component of the Group that
engages in business activities from which it may earn
revenues and incur expenses, including revenue and
expenses that relate to transactions with any of the Group’s
other components. The Board of Directors consider that
it is appropriate to report results as one single business
segment. This is consistent with management accounting
information reported regularly to the Board. The Group’s
Chief Operating Decision Maker (“CODM”) is considered to
be the Board.
2.6 Revenue
To determine whether to recognise revenue, the Group
follows a five-step process:
1. Identifying the contract with a customer
2. Identifying the performance obligations
3. Determining the transaction price
4. Allocating the transaction price to the performance
obligations
5. Recognising revenue when/as performance obligation(s)
are satisfied.
In accordance with IFRS 15, revenue is calculated based
on the consideration to which the Group expects to be
entitled and is recognised over the length of services
provided under the contract and once performance
obligations have been met. The transaction fee is
allocated over the length of the service being provided
in accordance with the project plan. It is recognised as a
contract liability at the time of the initial transaction and is
recognised on a straight-line basis over the lifetime of the
contracts. The progress is re-evaluated by Management
at each reporting date and the revenue recognised is re-
measured accordingly.
The Group enters into contracts for supply of goods to
external customers against orders received. The majority
of contracts that the Company enters into relate to sales
orders containing single performance obligation for the
delivery of consumer healthcare products. Revenue is
recognised when control of the goods is passed to the
customer. The point at which control passes is determined
by each customer arrangement, but generally occurs
when title passes to the customer, on receipt of the goods
on an ex-works basis.
Product revenue represents net invoice less estimated
volume discounts, which are considered to be variable
consideration and include significant estimates. Other
variable considerations such as milestone payments and
royalties are not recognised in full until it is highly probable
that a significant reversal in the amount of cumulative
revenue recognised will not occur. In Management’s
opinion, that will be when the Group’s customer confirms
that the milestone has been met or that a royalty is
due. Estimates associated with variable consideration
are revisited at each reporting date or when the related
uncertainty resolved and revenue is adjusted accordingly.
Contracts with customers carry no obligations relating to
returns or refunds of the product. As such, no provision has
been made in respect of returns or refunds.
Commercialisation and licensing revenue
The Group entered into commercialisation agreements
to license the Group’s products to other parties. These
contracts give rise to fixed and variable consideration from
upfront payments, development milestones, sales-based
milestones and royalties.
The licences that the Group grant are typically rights to
use intellectual property which do not change significantly
during the period of the licence and therefore related non-
conditional licensing revenue is recognised at the point
where the licence is granted and variable consideration
as soon as recognition criteria are met. Where control of
a right to use licence for an intangible asset passes at the
outset of a contract, revenue is recognised at the point in
time when control is transferred.
Income dependent on the achievement of a development
milestone is recognised when it is highly probable that a
significant reversal in the amount of cumulative revenue
recognised will not occur, which is usually when the
related event occurs. In general, when triggering of a
milestone is subject to the decisions of third parties (e.g.
the acceptance or approval of a filing by a regulatory
authority), the Group does not consider that the threshold
for recognition is met until that decision is made.
Sales-based milestone income is recognised when it is
highly probable that the sales threshold will be reached.
Sales-based royalties on a licence of intellectual property
are not recognised until the relevant product sale occurs.
2.7 Leased assets
For any new contracts entered into, the Group considers
whether a contract is, or contains a lease. A lease is defined
as a contract, or part of a contract, that conveys the right
to use an asset (the underlying asset) for a period of time
in exchange for consideration. To apply this definition, the
Group assesses whether the contract meets three key
evaluations which are whether:
• the contract contains an identified asset, which is either
explicitly in the contract or implicitly specified by being
identified at the time the asset is made available to
the Group;
• the Group has the right to obtain substantially all of the
economic benefits from the use of the identified asset
throughout the period of use, considering its rights
within the defined scope of the contract; and
• the Group has the right to direct the use of the identified
asset throughout the period of use. The Group assesses
whether it has the right to direct “how and for what
purpose” the asset is used throughout the period of use.
Futura Medical plc Annual Report 2023 | 72
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
2. ACCOUNTING POLICIES CONTINUED
The Group makes use of leasing arrangements principally
for the provision of the main office space and IT
equipment. The rental contracts for offices are typically
negotiated on a short-term rolling basis with one month’s
notice. Lease terms for IT equipment have lease terms of
three years without any extension terms. The Group does
not enter into sale and leaseback arrangements. All the
leases are negotiated on an individual basis and contain
a wide variety of different terms and conditions such as
purchase options and escalation clauses.
The Group has elected to account for short-term leases
and leases of low-value assets using the practical
expedients. These leases relate to items of certain low
value IT equipment and short-term office leases. Instead
of recognising a right-of-use asset and lease liability,
the payments in relation to these are recognised as an
expense in profit or loss on a straight-line basis over the
lease term.
2.8 Intangible assets
Research and development (“R&D”)
Expenditure incurred on the development of
internally generated products is capitalised if it can be
demonstrated that:
• it is technically feasible to develop the product for it to
be sold;
• adequate resources are available to complete the
development;
• there is an intention to complete and sell the product;
• the Group is able to out-license or sell the product;
• sale of the product will generate future economic
benefits; and
R&D costs recognised in the Consolidated Statement of
Comprehensive Loss. The useful life and the value of the
capitalised development cost are assessed for indicators
of impairment at least annually. The value is written
down immediately if impairment has occurred and the
unimpaired cost amortised over the remaining useful life.
The Directors consider that the criteria to capitalise
development expenditure are not yet met for any of its
products as they have either not yet been approved or
they have not yet commercially launched in the major
markets therefore commercial feasibility of the product is
not yet certain. For markets where the products have been
launched, development spend is no longer applicable.
Development expenditure, not satisfying the above criteria,
and expenditure on the research phase of internal projects
are included in R&D costs recognised in the Consolidated
Statement of Comprehensive Loss as incurred.
2.9 Plant and equipment
Plant and equipment is initially recognised at cost, and
subsequently at cost less accumulated depreciation
and any accumulated impairment losses. Cost includes
expenditure that is directly attributable to the acquisition
of the items. Depreciation is charged to the Consolidated
Statement of Comprehensive Loss at rates calculated
to write off the cost, less estimated residual value, of
each asset on a straight-line basis over their estimated
useful lives.
Plant and equipment
Furniture and fittings
2–5 years straight-line
3–10 years straight-line
The assets’ residual values and useful lives are determined
by the Directors and reviewed and adjusted, if appropriate,
at each reporting date.
• expenditure on the project can be measured reliably.
2.10 Impairment of non-financial assets
Capitalised development costs, including patents and
trademarks, are amortised over the periods in which
the Group expects to benefit from selling the products
developed. The amortisation expense is included in
Assets are assessed for indicators of impairment at
each reporting date. Where indicators are identified,
an impairment review is carried out for assets being
amortised or depreciated when a change in market
conditions and other circumstances indicate that the
carrying value may not be recoverable. The recoverable
amount is the higher of an asset’s fair value less costs
to sell and value-in-use. For the purpose of assessing
impairment, assets are grouped at the lowest levels for
which there are separately identifiable cash flows.
2.11 Classification of financial instruments issued by the
Group
In accordance with the requirements of IAS 32, financial
instruments issued by the Group are treated as equity only
to the extent that they meet the following two conditions:
• they include no contractual obligations upon the
Company to deliver cash or other financial assets or
to exchange financial assets or financial liabilities with
another party under conditions that are potentially
unfavourable to the Company; and
• where the instrument will or may be settled in the
Company’s own equity instruments, it is either a non-
derivative that includes no obligation to deliver a variable
number of the Company’s own equity instruments
or is a derivative that will be settled by the Company
exchanging a fixed amount of cash or other financial
assets for a fixed number of its own equity instruments.
2.12 Financial instruments
i) Recognition and initial measurement
At the year-end, the Group had no financial assets or
liabilities designated at fair value through the Consolidated
Statement of Comprehensive Loss (2022: £nil). Trade
receivables and debt securities are initially recognised
when they are originated. All other financial assets and
liabilities are initially recognised when the Group becomes
a party to the contractual provisions in the instrument.
A financial asset (unless it is a trade receivable without a
significant financing component) or a financial liability is
initially measured at fair value plus, for items not measured
at fair value through profit and loss (“FVTPL”), transaction
costs that are directly attributable to its acquisition or
issue. A trade receivable without a significant financing
component is measured at the transaction price.
Futura Medical plc Annual Report 2023 | 73
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
2. ACCOUNTING POLICIES CONTINUED
ii) Classification and subsequent measurement
Financial assets
On initial recognition a financial instrument is classified
as measured at amortised cost, fair value through other
comprehensive income (“FVOCI”) or FVTPL. Financial
assets are not reclassified subsequent to their initial
recognition unless the Group changes its business model
for managing financial assets.
A financial asset is measured at amortised cost if it meets
both the following conditions and is not designated as
FVTPL:
• it is held within a business model whose objective is to
hold assets to collect contractual cash flows; and
• its contractual terms give rise on a specified date to
cash flows that are solely the payment of principal and
interest on the principal outstanding.
Financial liabilities
Financial liabilities are classified as measured at amortised
cost or FVTPL. A financial liability is classified as FVTPL
if it is held for trading, it is a derivative or it is designated
as such on initial recognition. Other financial liabilities
are subsequently measured at amortised cost using the
effective interest method. Interest expense is recognised in
profit or loss. At the year-end, the Group had no financial
assets or liabilities designated at FVOCI (2022: £nil).
iii) Derecognition
Financial assets
The Group derecognises a financial asset when the
contractual rights to the cash flows from the financial
asset expire, or it transfers the rights to receive the
contractual cash flows in a transaction in which
substantially all the risks and rewards of ownership of
the financial asset are transferred or in which the Group
neither transfers nor retains substantially all of the risks
and rewards of ownership and it does not retain control of
the financial asset.
An impairment loss is recognised for the expected credit
losses on financial assets when there is an increased
probability that the counterparty will be unable to settle
an instrument’s contractual cash flows on the contractual
due dates, a reduction in the amounts expected to be
recovered, or both.
The Group applies a simplified approach in calculating
expected credit losses. The probability of default and
expected amounts recoverable are assessed using
reasonable and supportable past and forward-looking
information that is available without undue cost or effort.
In calculating, the Group uses its historical experience,
external indicators and forward-looking information to
calculate the expected credit losses on a customer-by-
customer basis.
Financial liabilities
The Group derecognises a financial liability when the
contractual obligations are discharged, cancelled or
expire. The Group also derecognises a financial liability
when its terms are modified and the cash flows of the
modified liability are substantially different, in which case
a new financial liability based on the modified terms is
recognised at fair value. On derecognition of a financial
liability, the difference between the carrying amount
extinguished and the consideration paid is recognised in
profit or loss.
2.13 Taxation
Income tax is recognised or provided at amounts expected
to be recovered or to be paid using the tax rates and tax
laws that have been enacted or substantively enacted at
the Consolidated Statement of Financial Position date.
R&D tax credits are recognised on an accruals basis and
are included as an income tax credit under current assets.
Deferred tax assets and liabilities are recognised where the
carrying amount of an asset or liability on the Consolidated
Statement of Financial Position date differs from its tax
base, except for differences arising on:
• the initial recognition of an asset or liability in a
transaction which is not a business combination and
which at the time of the transaction affects neither
accounting profit nor taxable profit; and
• investments in subsidiaries and jointly controlled entities
where the Group is able to control the timing of the
reversal of the difference and it is probable that the
difference will not reverse in the foreseeable future.
Recognition of deferred tax assets is restricted to those
instances where it is probable that taxable profits will be
available against which the difference can be utilised.
The amount of the asset or liability is determined using
tax rates that have been enacted or substantively enacted
by the Consolidated Statement of Financial Position date
and are expected to apply when the deferred tax liabilities/
(assets) are settled/(recovered). Deferred tax balances are
not discounted.
Deferred tax assets and liabilities are offset when the
Group has a legally enforceable right to offset current
tax assets and liabilities and the deferred tax assets and
liabilities relate to taxes levied by the same tax authority on
either:
• the same taxable group company; or
• different group entities which intend to settle current
tax assets and liabilities on a net basis, or to realise the
assets and settle the liabilities simultaneously, on each
future period in which significant amounts of deferred
tax assets or liabilities are expected to be settled or
recovered.
Futura Medical plc Annual Report 2023 | 74
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
2. ACCOUNTING POLICIES CONTINUED
2.14 Foreign currency translation
Foreign currency transactions are translated into the
functional currency using the exchange rates prevailing at
the dates of the transactions. Foreign exchange gains and
losses resulting from the settlement of such transactions
and from the translation at period end exchange rates of
monetary assets and liabilities denominated in foreign
currencies are recognised in the Consolidated Statement
of Comprehensive Loss in the period in which they arise.
2.15 Employee benefits
Defined contribution plans
The Group provides retirement benefits to all employees
who wish to participate in defined contribution pension
schemes. The assets of these schemes are held separately
from those of the Group in independently administered
funds. Contributions made by the Group are charged to
the Consolidated Statement of Comprehensive Loss in the
period in which they become payable.
Accrued holiday pay
Provision is made at each reporting date for holidays
accrued but not taken, at applicable rates of salary. The
expected cost of compensated short-term absence
(holidays) is charged to the Consolidated Statement of
Comprehensive Loss on an accruals basis.
Share-based payment transactions
The Group operates an annual equity-settled share-based
compensation plan. For all share options awarded to
employees, and others providing similar services, the fair
value of the share options at the date of grant is charged
to the Consolidated Statement of Comprehensive Loss
over the vesting period. Non-market vesting conditions
are taken into account by adjusting the number of equity
instruments expected to vest at each Consolidated
Statement of Financial Position date so that, ultimately,
the cumulative amount recognised over the vesting period
is based on the number of share options that eventually
vest. There are no market-based vesting conditions. If
the terms and conditions of share options are modified
before they vest, any incremental increase in the fair value
of the share options, measured immediately before and
after the modification, is also charged to the Consolidated
Statement of Comprehensive Loss over the remaining
vesting period. The proceeds received when share options
are exercised, net of any directly attributable transaction
costs, are credited to share capital (nominal value) and the
remaining balance to share premium. All employee share
option holders enter into an HM Revenue & Customs joint
election to transfer the employers’ National Insurance
contribution potential liability to the employee, therefore
no Group asset or liability arises.
Long-term incentive plan
The Group operates a long-term incentive plan (“LTIP”)
for all staff and Directors. The quantum of any awards
receivable will depend on the Group achieving set
milestones and the share price at the time relative to
targets set in advance. The Group plan is intended to be
settled in equity with cash settlement possible at the
discretion of the Board. For all LTIP share options awarded
to employees, and others providing similar services, the fair
value of the share options at the date of grant is charged
to the Consolidated Statement of Comprehensive Loss
over the vesting period. Non-market vesting conditions
are taken into account by adjusting the estimate of the
number of equity instruments expected to vest at each
reporting date so that, ultimately, the cumulative amount
recognised over the vesting period is based on the number
of share options that eventually vest. If the terms and
conditions of share options are modified before they vest,
the change in the fair value of the share options, measured
immediately before and after the modification, is also
charged to the Consolidated Statement of Comprehensive
Loss over the remaining vesting period. The proceeds
received when share options are exercised, net of any
directly attributable transaction costs, are credited to share
capital (nominal value) and any remaining balance to
share premium. All employee share option holders enter
into an HM Revenue & Customs joint election to transfer
the employers’ National Insurance contribution potential
liability to the employee, therefore no Group asset or
liability arises.
2.16 Finance income
Interest income is recognised on a time-proportion basis
using the effective interest rate method.
2.17 Cash and cash equivalents
Cash and cash equivalents are basic financial assets and
comprise of cash in hand, which are readily available and
with original maturity of three months or less.
2.18 Warrants
The Company may issue warrants from time to time in
conjunction with equity instruments. Where warrants
are issued, the fair value of the warrants are determined
using the Black–Scholes method and the balance held
in a warrant reserve until such time the warrants are
exercised or lapse. The warrant reserve is transferred to
retained earnings on exercise or lapse, as it is treated as
distributable profit reserve from the point of issue.
Futura Medical plc Annual Report 2023 | 75
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
3. ESTIMATES AND JUDGEMENTS
In the application of the Group’s accounting policies,
which are described in Note 2, Management is required
to make judgements, estimates and assumptions about
the carrying amounts of assets and liabilities that are not
readily apparent from other sources.
The significant judgements and estimates made in
relation to the financial statements are:
Share-based payments
The Group operates an equity-settled share-based
compensation plan for employee services (and others
providing similar services) to be received and the
corresponding increases in equity are measured by
reference to the fair value of the equity instruments as at
the date of grant. The fair value determination is based
on the principles of the Black–Scholes model which uses
an input of volatility based on historical data. Historical
volatility may not be indicative of future volatility, yet the
Directors judge this to be the most appropriate method
of calculation. Given the share-based payment expense
of £2,720,297 (2022: £671,852), the volatility methodology
used is not expected to have a material impact on these
financial statements. Details of the fair value calculation
for options granted during the year, including other inputs
into the Black–Scholes model, are disclosed in Note 17.
Fair value of derivative instruments
Where the fair value of derivative instruments recorded
in the Consolidated Statement of Financial Position
cannot be derived from active markets, their fair value
is determined using valuation techniques. The inputs to
these models are taken from observable markets where
possible. Where this is not feasible, a degree of judgement
is required in establishing fair values. The judgements
include considerations of inputs such as volatility.
There are no significant estimates which are expected
to lead to material adjustments in the next accounting
period.
4. FINANCIAL RISK
4.1 Financial risk factors
The Group’s activities expose it to a variety of financial risks:
market risk (including foreign exchange rate risk, cash
flow interest rate risk and fair value interest rate risk); credit
risk and liquidity risk. It is Group policy not to enter into
speculative positions using complex financial instruments.
(i) Market risk
Foreign exchange rate risk
The Group primarily enters into supplier contracts which
are to be settled in sterling. However, some contracts
involve other currencies including the US Dollar and the
Euro. The Group may use forward exchange contracts as
an economic hedge against currency risk, where cash
flow can be judged with reasonable certainty. There were
no open forward contracts as at 31 December 2023 or at
31 December 2022.
At 31 December 2023, the Group held balances of the
following denominated currencies:
Year ended
31 December
2023
£
4,199,183
832,462
2,682,537
Year ended
31 December
2022
£
3,589,876
139,167
377,427
£
€
$
GBP
EUR
USD
The majority of operating costs are denominated in
Sterling although certain expenditures were payable in
Euros and US Dollars. At 31 December 2023 the Group had
trade payables denominated in a foreign currency totalling
£115,071 (31 December 2022: £149,189) and trade receivables
denominated in foreign currency totalling £1,147,709
(31 December 2022: £nil).
Cash flow interest rate risk and fair value
interest rate risk
The Group’s interest rate risk arises from short-term money
market deposits.
(ii) Credit risk
Credit risk arises from cash and cash equivalents and
money market deposits as well as credit exposure in
relation to outstanding receivables. Trade receivables have
been reviewed and there are no historical cases of default
or material balances which are past due. Management
considers that the financial assets below are of good
credit quality.
The carrying value of the financial assets recorded in the
Consolidated Statement of Financial Position represents
the Group’s maximum exposure to credit risk.
The credit risk for liquid funds and short-term financial
assets relates to banking institutions holding such funds
or assets on behalf of the Group. The counterparties
are considered to be reputable banks with high-quality
external risk ratings.
The exposure relating to outstanding receivables and the
carrying amount of cash balances is as follows:
Cash at bank and
in hand
Trade receivables
31 December
2023
£
31 December
2022
£
7,714,182
1,147,709
8,861,891
4,026,112
–
4,026,112
The Directors consider the Group’s exposure to credit risk
to be acceptable and normal for a similar entity at its stage
in development.
Futura Medical plc Annual Report 2023 | 76
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
4. FINANCIAL RISK CONTINUED
(iii) Liquidity risk
In the normal course of business the Group is exposed to liquidity risk. The Group’s objective is to ensure that sufficient
resources are available to fund short-term working capital and longer-term strategic requirements. The Group manages
its liquidity needs by monitoring cash outflows due in day-to-day business. Liquidity needs are monitored in various time
bands, on a day-to-day and week-to-week basis. Long-term liquidity needs are monitored regularly.
At 31 December 2023 and 31 December 2022, the Group’s liabilities had contractual maturities which are summarised as
follows:
31 December 2023
Trade and other payables
Contract liability
31 December 2022
Trade and other payables
Contract liability
Carrying
amount
£
2,491,818
3,847,716
6,339,534
Carrying
amount
£
1,320,958
432,151
1,753,109
2 months
or less
£
2,491,818
–
2,491,818
2 months
or less
£
1,320,958
–
1,320,958
2–12
months
£
More than
1 year
£
–
3,321,970
3,321,970
–
525,746
525,746
2–12
months
£
More than
1 year
£
–
322,716
322,716
–
109,435
109,435
The Group manages all of its external bank accounts centrally and in accordance with defined treasury policies. The
policies include a minimum acceptable credit rating of relationship bank accounts and financial transaction authority
limits. Any material change to the Group’s principal bank facility requires Board approval.
4.2 Capital risk management
The Group’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can
provide returns for shareholders and benefits for other stakeholders. The Group does not yet have significant recurring
revenues and has mainly financed its operations through the issue of new shares and management of working capital.
The Group’s capital resources are managed to ensure it has resources available to invest in operational activities designed
to generate future income. These resources were represented by £7,714,182 of cash at bank as at 31 December 2023
(31 December 2022: £4,026,112).
5. SEGMENT REPORTING
The Group is focused on the development and
commercialisation of Eroxon® and therefore operates as
one segment. The Group derives revenue from the transfer
of goods and services over time and at a point in time in
the following geographical split:
EU and UK
Rest of world
Revenue recognised at
a point in time
Revenue recognised
over time
31 December
2023
2,725,475
375,493
3,100,968
31 December
2022
–
–
–
31 December
2023
31 December
2022
3,044,075
56,893
3,100,968
–
–
–
In the current year, two customers represented more than
10% (2022: n/a) of revenue.
All revenue reported by the Group is from contracts with
customers.
The relationship between the timing of the satisfaction
of the Group’s performance obligations and the typical
timing of payments from contracts with customers is as
follows:
• Revenue for the sale of goods is recognised at the
point in time when the goods are delivered or collected
under ex-works arrangements, which completes our
performance obligation. At this point in time the
consideration is unconditional because only the passage
of time is required before payment is due. Payment is
typically due between 30 and 60 days following delivery
of the goods.
Futura Medical plc Annual Report 2023 | 77
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
7. STAFF NUMBERS AND COSTS
The average number of persons (including all Executive
and excluding Non-Executive Directors) employed by
the Group during the year, analysed by category, was as
follows:
R&D staff
Finance and
administration staff
Executive Directors
Year ended
31 December
2023
7
Year ended
31 December
2022
7
2
3
12
2
3
12
The aggregate payroll costs of these persons were as
follows:
Year ended
31 December
2023
£
2,284,686
448,689
Year ended
31 December
2022
£
2,150,346
274,083
196,252
153,384
2,929,627
2,577,813
2,720,297
5,649,924
671,852
3,249,665
Wages and salaries
Social security costs
Other pension and
insurance benefits costs
Total cash-settled
remuneration
Share-based payment
remuneration charge
Total remuneration
All employees of the Group are employed by Futura
Medical Developments Limited.
Directors’
remuneration
Wages and salaries
Other pension and
other benefit costs
Share-based payment
remuneration charge
Social security costs
Total remuneration
Year ended
31 December
2023
£
1,350,349
Year ended
31 December
2022
£
1,166,078
28,371
26,591
1,058,584
256,535
2,693,839
313,867
143,503
1,650,039
In 2023 there were no Directors (2022: one) who exercised
share options under the Group share option schemes
and a gain of £nil was realised (2022: £37,975). In respect of
the highest paid Director there was £nil gain realised
(2022: £37,975).
In 2023 there were no Directors (2022: no Directors)
who participated in a private money purchase defined
contribution pension scheme. Emoluments for individual
Directors are disclosed within the Remuneration
Committee Report.
5. SEGMENT REPORTING CONTINUED
• For revenue recognised over time, payment is typically
received in the form of upfront payments. The
performance obligations are met over the duration
of the contract. A contract liability is recognised and
adjusted at each reporting period to reflect unsatisfied
performance obligations based on a straight-lined
apportioned basis over the term of the customer
contract. Included in revenue for the year is £24,832
(2022: £nil) which was included in the contract liability
at the beginning of the period. See Note 15 on contract
liabilities.
6. OPERATING LOSS
Operating loss is
stated after charging/
(crediting):
Depreciation of plant
and equipment
(Note 10)
Loss on disposal of plant
and equipment
Short-term leases:
property
(Gain)/loss on foreign
exchange
Year ended
31 December
2023
£
Year ended
31 December
2022
£
128,360
24,734
54,256
585
128,205
120,881
(80,007)
98,923
The fees of the Group’s Auditor Grant Thornton UK LLP for
services provided are analysed below:
Audit services
Parent Company
Subsidiaries
Other non-audit
services
iXBRL tagging
Total fees
Year ended
31 December
2023
£
Year ended
31 December
2022
£
49,368
28,462
–
77,830
51,237
15,420
2,000
68,657
Futura Medical plc Annual Report 2023 | 78
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
7. STAFF NUMBERS AND COSTS CONTINUED
The Directors consider that there are no Key Management Personnel other than the Directors.
Remuneration on the previous page includes the following amounts in respect of the highest-paid Director:
Wages and salaries
Employer pension contributions and other benefits
Share-based payment remuneration charge
Social security costs
Total remuneration
8. TAXATION
8.1 Current tax
UK corporation tax credit on loss on ordinary activities
The tax assessed for the year was lower than the UK corporation tax rate (2022: lower). The differences are explained below:
Loss on ordinary activities before tax
Loss on ordinary activities multiplied by the standard rate of corporation tax in the UK of 23.5% (2022: 19%)
Expenses not deductible for tax purposes
Movement in unrecognised deferred tax
Unutilised tax losses
Share scheme deduction
Surrender of tax losses for R&D tax credit refund
Additional deduction for R&D expenditure
UK corporation tax credit
UK corporation tax credit reported in the Consolidated Statement of Comprehensive Loss
Year ended
31 December
2023
£
462,027
6,186
386,893
76,391
931,497
Year ended
31 December
2022
£
390,898
6,186
100,119
60,144
557,347
Year ended
31 December
2023
£
Year ended
31 December
2022
£
379,074
1,024,994
Year ended
31 December
2023
£
Year ended
31 December
2022
£
6,891,973
1,621,028
(42,579)
(591,322)
(815,647)
223,602
(402,538)
386,530
379,074
379,074
6,871,489
1,305,583
(247)
(122,999)
(624,175)
25,793
(318,101)
759,140
1,024,994
1,024,994
Futura Medical plc Annual Report 2023 | 79
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
8. TAXATION CONTINUED
The unrecognised asset comprises of:
An increase in the main rate of UK corporation tax from
19% to 25% came into force on 1 April 2023. As a result, the
current tax charge is calculated using the average tax rate
of 23.52% for the year ended 31 December 2023.
The corporation tax credit for the year represents research
and development tax credits of £379,074 (2022: £1,024,994),
arising from the surrender of losses (rather than carrying
forward to future years) of £3,323,097 (2022: £7,068,921)
under HMRC’s small and medium size enterprise scheme.
The taxable loss for the year is in excess of the accounting
loss for various reasons, principally the additional
deductions given for tax purposes on research and
development expenditure.
The Group has tax losses of approximately £42,242,997
(2022: £38,980,404) available for offset against future
taxable profits.
8.2 Deferred tax
Deferred tax assets amounting to £11,980,458 (2022:
£10,484,989) have not been recognised due to it not being
probable that taxable profits will be available against
which these deductible temporary differences can be
utilised.
Depreciation differential versus capital allowances
Other short-term timing differences
Unutilised tax losses
Year ended
31 December
2023
£
Year ended
31 December
2022
£
(5,049)
1,424,758
10,560,749
11,980,458
(6,800)
746,688
9,745,101
10,484,989
9. LOSS PER SHARE
The calculation of basic and diluted earnings per share (“EPS”) is based on the following data:
Loss for the purposes of basic EPS and diluted EPS (£)
Weighted average of ordinary shares for purposes of basic and diluted EPS (number)
Loss per share basic and diluted (pence)
2023
6,512,899
294,912,404
2.21
2022
5,846,495
287,478,055
2.03
Diluted EPS is calculated in the same way as basic EPS but also with reference to reflect the dilutive effect of share
options in existence at the year-end which were 20,518,841 (2022: 6,583,800). The diluted loss per share is identical to the
basic loss per share, as potential dilutive shares are not treated as dilutive since they would reduce the loss per share.
Futura Medical plc Annual Report 2023 | 80
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
10. PLANT AND EQUIPMENT
Cost
At 1 January 2023
Additions
Disposals
At 31 December 2023
Depreciation
At 1 January 2023
Eliminated on disposals
Charge for year
At 31 December 2023
Net book value
At 31 December 2023
At 31 December 2022
Cost
At 1 January 2022
Additions
Disposals
At 31 December 2022
Depreciation
At 1 January 2022
Eliminated on disposals
Charge for year
At 31 December 2022
Net book value
At 31 December 2022
At 31 December 2021
Plant and
Equipment
£
1,283,853
1,505,849
(54,255)
2,735,447
132,089
(5,391)
126,544
253,242
Furniture
and Fittings
£
65,321
–
–
Total
£
1,349,174
1,505,849
(54,255)
65,321
2,800,768
59,050
–
3,728
62,778
191,139
(5,391)
130,272
316,020
2,482,205
1,151,764
2,543
6,271
2,484,748
1,158,035
Plant and
Equipment
£
Furniture
and Fittings
£
545,270
740,697
(2,114)
1,283,853
108,884
(1,529)
24,734
132,089
1,151,764
436,386
Total
£
610,591
740,697
(2,114)
1,349,174
167,934
(1,529)
24,734
191,139
65,321
–
–
65,321
59,050
–
–
59,050
6,271
6,271
1,158,035
442,657
All fixed assets of the Group are held in Futura Medical Developments Limited. At 31 December 2023, the Group was
committed to purchase plant and equipment totalling £2,200,218 (31 December 2022: £nil) and had paid advances on
assets under construction of £1,363,215 (2022: £nil).
11. FINANCIAL INSTRUMENTS BY CATEGORY
The accounting policies for financial instruments have
been applied to the line items below:
Assets as per
Consolidated
Statement of
Financial Position
Receivables at
amortised cost
Trade and other
receivables (Note 12)
Cash and cash
equivalents (Note 13)
Total financial assets
at amortised cost
Liabilities as per
Consolidated
Statement of
Financial Position at
amortised cost
Trade and other
payables (Note 14)
Total financial
liabilities at
amortised cost
31 December
2023
£
31 December
2022
£
1,147,709
70,114
7,714,182
4,026,112
8,861,891
4,096,226
31 December
2023
£
31 December
2022
£
6,339,534
1,753,109
6,339,534
1,753,109
The Directors consider that there is no material difference
between the carrying values of financial assets and
liabilities, and their fair value.
Futura Medical plc Annual Report 2023 | 81
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
12. TRADE AND OTHER RECEIVABLES
Amounts receivable
within one year:
Trade receivables
Financial assets (Note 11)
Prepayments
31 December
2023
£
31 December
2022
£
1,147,709
1,147,709
92,465
1,240,174
70,114
70,114
195,570
265,684
Trade and other receivables do not contain any impaired
assets. The Group does not hold any collateral as security and
the maximum exposure to credit risk at the Consolidated
Statement of Financial Position date is the fair value of each
class of receivable.
Trade receivables are measured initially at fair value and
subsequently held at amortised cost less an allowance
for expected credit losses. The Group has applied the
simplified approach to measuring credit losses, which
uses a lifetime expected loss allowance. To measure
the expected credit losses, trade receivables have been
grouped based on days overdue. Standard credit terms
are between 30 and 90 days from the date the invoice
was issued.
The allowance for expected credit losses assessment
requires a degree of judgement and estimation based on a
combination of factors, including the Group’s historical loss
experience and any anticipated effects related to current
economic conditions, as well as Management knowledge
of the current composition of trade receivables. Trade
receivables that Management believe to be ultimately
not collectible are written off upon such determination.
The Group defines default of customer balances as any
amounts outside of the contractual repayment terms.
Trade receivables are regularly reviewed for impairment
loss. The Group has assessed the credit risk of its financial
assets measured at amortised cost and has determined
that the loss allowance for expected credit losses of
those assets is immaterial to the financial statements.
As the Group has no material expected credit losses the
disclosure of the ageing and credit risk relating to trade
receivables is not required and therefore not presented.
The Group’s trade receivables are denominated in GBP.
The carrying value of trade and other receivables in the
Group is consistent with fair value in the current and
prior year.
The other classes of assets within trade and other
receivables are denominated in GBP and do not contain
impaired assets.
Contracts with customers
No impairment losses (2022: £nil) were recognised on
receivables arising from contracts with customers.
Receivables included
within ‘Trade and other
receivables’
Contract liabilities
31 December
2023
£
31 December
2022
£
1,147,709
3,847,716
4,995,425
70,114
432,151
502,265
13. CASH AND CASH EQUIVALENTS
Cash at bank and in
hand
31 December
2023
£
31 December
2022
£
7,714,182
7,714,182
4,026,112
4,026,112
14. TRADE AND OTHER PAYABLES
Trade payables
Social security and
other taxes
Contract liabilities
Accrued expenses
31 December
2023
£
1,006,054
31 December
2022
£
316,181
71,850
3,847,716
1,413,914
6,339,534
145,092
432,151
859,685
1,753,109
Futura Medical plc Annual Report 2023 | 82
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
15. CONTRACT LIABILITIES
16. SHARE CAPITAL
Contract liabilities comprise of payments from commercial
partners where performance obligations remain
outstanding at the period end and revenue is recognised
over time. The revenue recognition policy is explained in
Note 2.6.
The significant changes in contract liabilities are
presented below:
Allotted, called up and fully paid
31 December
2023
Number
31 December
2022
Number
31 December
2023
£
31 December
2022
£
Ordinary shares of 0.2 pence each
301,405,950
288,046,527
602,812
576,093
The number of issued ordinary shares as at 1 January 2022 was 287,150,971. Each ordinary share carries the right to one
vote and receive dividends from time to time. During the year ended 31 December 2022, the Company issued shares of
0.2 pence per share, as follows:
Revenue recognised
in the year that was
included in the opening
contract liability balance
Revenue recognised
in the year that was
received in the current
year
Cash received,
excluding amounts
recognised as revenue
in the period
31 December
2023
£
31 December
2022
£
24,832
32,061
–
–
3,472,475
432,151
Month
Reason For Issue
January 2022
September 2022
September 2022
September 2022
November 2022
Non-Executive Director award at 15 pence per share
Exercise of share options at 30 pence per share
Exercise of share options at 7.5 pence per share
Exercise of share options at 31 pence per share
Exercise of share options at 7.5 pence per share
Gross
Consideration
£
21,834
75,000
18,750
46,500
7,500
169,584
Shares
Issued
Number
145,556
250,000
250,000
150,000
100,000
895,556
The number of issued ordinary shares as at 1 January 2023 was 288,046,527. During the year ended 31 December 2023, the
Company issued shares of 0.2 pence with each ordinary share carrying the right to one vote and receive dividends from
time to time as follows:
The maturities of the contract liabilities are
presented below:
Month
Reason For Issue
Due within one year
Due after one year
31 December
2023
£
3,321,970
525,746
3,847,716
31 December
2022
£
322,716
109,435
432,151
January 2023
June 2023
July 2023
July 2023
July 2023
July 2023
July 2023
October 2023
November 2023
Non-Executive Director award at 36.36 pence per share
Exercise of warrants
Exercise of share options at 15.5 pence per share
Exercise of share options at 31 pence per share
Exercise of share options at 30.50 pence per share
Exercise of share options at 7.5 pence per share
Exercise of share options at 0.2 pence per share
Exercise of share options at 0.2 pence per share
Exercise of share options at 0.2 pence per share
Gross
Consideration
£
31,790
4,375,000
70,672
46,500
15,250
7,500
1,770
530
857
Shares
Issued
Number
87,430
10,937,500
456,000
150,000
50,000
100,000
884,836
265,000
428,657
4,549,869
13,359,423
Futura Medical plc Annual Report 2023 | 83
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
17. SHARE OPTIONS
At 31 December 2023, the number of ordinary shares of 0.2 pence each subject to share options granted under the Company’s Approved and Unapproved Share Option Schemes were:
Exercise Period
1 October 2018 – 30 September 2023
1 October 2019 – 30 September 2024
1 October 2020 – 30 September 2025
1 October 2021 – 30 September 2026
1 October 2022 – 30 September 2027
1 October 2023 – 30 September 2028
1 October 2023 – 30 September 2028
1 October 2025 – 30 September 2030
7 January 2023 – 6 January 2033
6 April 2026 – 31 March 2033
9 October 2023 – 30 September 2033
Exercise Price
per Share
Pence
57.50
30.50
7.50
31.00
15.50
37.90
29.50
45.00
0.2
43.60
0.2
At
1 January
2023
Number
680,000
500,000
500,000
940,000
1,308,000
1,588,800
100,000
967,000
4,444,940
–
–
Options
Exercised
Number
–
(50,000)
(100,000)
(150,000)
(456,000)
–
–
–
(885,074)
–
(693,657)
Options
Lapsed
Number
(680,000)
–
–
–
–
–
–
–
–
–
Options
Granted
Number
–
–
–
–
–
–
–
–
–
1,934,000
10,570,832
11,028,740
(2,334,731)
(680,000)
12,504,832
At
31 December
2023
Number
–
450,000
400,000
790,000
852,000
1,588,800
100,000
967,000
3,559,866
1,934,000
9,877,175
20,518,841
On 6 April 2023 share options over 1,934,000 new ordinary
shares were granted to employees (including Executive
Directors) at a price of 43.6p. The options have a three-year
vesting period and vesting is subject to the satisfaction of a
non-market performance condition. The exercise period for
these options is 1 April 2026 to 31 March 2033.
On 9 October 2023 share options over 10,570,832 new
ordinary shares were granted to employees (including
Executive and Non-Executive Directors) at a price of 0.02p
per share. The options granted will vest 25% immediately
with a further 25% vesting annually following the date
of grant.
The share options outstanding at 31 December 2023
represented 6.81% of the issued share capital as at that
date (2022: 3.84%) and would generate additional funds of
£2,481,113 (2022: £2,142,884) if fully exercised. The weighted
average remaining life of the share options outstanding at
31 December 2023 was 98 months (2022: 81 months) with a
weighted average remaining exercise price of 11.96 pence
(2022: 19.43 pence).
The share options exercisable at 31 December 2023 totalled
8,430,027 (2022: 5,039,235) with an average exercise price of
13.98 pence (2022: 21.34 pence) and would have generated
additional funds of £1,202,739 (2022: £1,075,373) if fully
exercised.
Options have historically been issued to advisers under
the unapproved scheme. There were 910,506 share options
outstanding to advisers at 31 December 2023 (31 December
2022: 247,416).
There were no market vesting conditions within the terms
of the grant of the share options.
The Black–Scholes formula is the option pricing model
applied to the grants of all share options made in respect of
calculating the fair value of the share options.
The Group’s share option scheme rules apply to all of
the share options outstanding at 31 December 2023
(31 December 2022: 11,028,740) and include a rule regarding
the forfeiture of unexercised share options upon the
cessation of employment (except in specific circumstances).
An amount of £2,720,297 (2022: £671,852) has been
recognised as a charge within administrative expenses in
the Consolidated Statement of Comprehensive Loss and
a credit to retained earnings within equity. There were no
cash-settled share-based payment transactions.
Futura Medical plc Annual Report 2023 | 84
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
17. SHARE OPTIONS CONTINUED
Share-based payments
Grant date
Number of shares under option
Vesting period ends
Share price as at date of grant
Option exercise price
Expected volatility
Dividend yield
Risk-free investment rate
Exercisable from/to
Expected life of options (years)
Fair value per share at grant date
Grant date
Number of shares under option
Vesting period ends
Share price as at date of grant
Option exercise price
Expected volatility
Dividend yield
Risk-free investment rate
Exercisable from/to
Expected life of options (years)
Fair value per share at grant date
LTIP Award
Tranche 1
9 Oct
2023
2,642,708
Oct 23
40p
0.2p
88.26%
0%
5.01%
2023
annual
award
6 Apr 2023
1,934,000
Apr 26
43.00p
43.60p
89.58%
0%
3.51%
Oct 23–Oct 33 Oct 24–Oct 33 Oct 25–Oct 33 Oct 26–Oct 33 Apr 26–Mar 33
3
24.96p
Tranche 4
9 Oct
2023
2,642,708
Oct 26
40p
0.2p
88.26%
0%
4.60%
Tranche 2
9 Oct
2023
2,642,708
Oct 24
40p
0.2p
88.26%
0%
4.86%
Tranche 3
9 Oct
2023
2,642,708
Oct 25
40p
0.2p
88.26%
0%
4.72%
0.25
39.80p
2.25
39.82p
3.25
39.83p
1.25
39.81p
LTIP Award
2022 annual share awards
Tranche 1
07 Dec
2022
1,111,235
Dec 22
44.60p
0.2p
96.49%
0%
3.29%
Tranche 2
07 Dec
2022
1,111,235
Dec 23
44.60p
0.2p
96.49%
0%
3.25%
02 Jun
2022
100,000
Oct 23
29.50p
29.50p
113.72%
0%
1.98%
Dec 22–Dec 30 Dec 23–Dec 30 Dec 24–Dec 30 Dec 25–Dec 30 Oct 25–Sep 30 Oct 23–Sep 28
3
16.5p
21 Sep
2022
967,000
Oct 25
44.80p
45.00p
100.62%
0%
3.05%
Tranche 4
07 Dec
2022
1,111,235
Dec 25
44.60p
0.2p
96.49%
0%
3.24%
Tranche 3
07 Dec
2022
1,111,235
Dec 24
44.60p
0.2p
96.49%
0%
3.12%
0.25
39.94p
3.25
39.96p
2.25
39.95p
1.25
39.95p
3
26.53p
Futura Medical plc Annual Report 2023 | 85
Notes to the Consolidated Financial Statements
for the year ended 31 December 2023
18. WARRANTS AND WARRANT RESERVE
19. PENSION COSTS
22. RELATED PARTY TRANSACTIONS
The pension charge represents contributions payable by
the Group to independently administered funds which
during the year ended 31 December 2023, amounted to
£196,532 (2022: £153,383). Pension contributions payable in
arrears at 31 December 2023, included in accrued expenses
at the relevant Consolidated Statement of Financial
Position date, totalled £5,258 (2022: £11,325).
Related parties, as defined by IAS 24 “Related Party
Disclosures”, are the wholly owned subsidiary companies,
Futura Medical Developments Limited, Futura Consumer
Healthcare Limited and the Board. Transactions between
the Company and the wholly owned subsidiary companies
have been eliminated on consolidation and are not
disclosed.
20. COMMITMENTS
At 31 December 2023 the Group had operating short-
term lease commitments in respect of property leases
cancellable on one month’s notice of £10,916
(2022: £10,365).
21. INVENTORIES
Inventory is carried at cost and the balance of £339 (2022:
£nil) relates to product samples held for testing and
marketing purposes.
Key management compensation
The Directors represent the key management personnel.
Details of their compensation and share options are
given in Note 7 and within the Remuneration Committee
Report.
On 21 January 2020, Futura Medical plc issued a warrant
instrument as part of a wider share issue to raise funds
under a subscription agreement. The Company issued
10,937,500 warrants at a ratio of one warrant for every two
ordinary shares subscribed in respect of the Subscription.
The warrants were exercisable until the fifth anniversary
of their issue at a price of 40 pence per ordinary share.
The warrants have been measured using the relative fair
value method and fair value has been calculated using the
Black–Scholes method using the following inputs:
Inputs to warrant pricing model
31 December
2022
Grant date
Number of warrants
Share price as at date of grant
Warrant conversion price
Expected life of warrants
Expected volatility
Dividend yield: no dividends assumed
Risk-free rate
21 January 2020
10,937,500
12.75 pence
40 pence
5 years
81.56%
0%
0.44% p.a.
At 1 January 2023, the balance of £165,868 (2022: £165,868)
was held in warrant reserve. The warrants were exercised
in June 2023 at a price of 40 pence per ordinary share
and 10,937,500 shares were issued. Upon exercise of the
warrant, £4.38 million was received as share capital and
premium and the balance held in the warrant reserve was
transferred to retained earnings.
Futura Medical plc Annual Report 2023 | 86
Parent Company Balance Sheet
as at 31 December 2023
Company No. 04206001
Non-current assets
Investments
Current assets
Trade and other receivables
Cash at bank and in hand
Total current assets
Liabilities
Trade and other payables
Total liabilities
Total net assets
Capital and reserves
Share capital
Share premium
Warrant reserve
Retained losses
Total equity
As at
31 December
2023
£
As at
31 December
2022
£
Notes
2
3
4
5
70,080,942
65,244,565
50,519
3,956,920
4,007,439
12,812
2,090,384
2,103,196
(182,112)
(182,112)
73,906,269
(149,633)
(149,633)
67,198,128
602,812
71,068,945
–
2,234,512
73,906,269
576,093
66,545,796
165,868
(89,629)
67,198,128
The loss in respect of the Company for the year was £564,024 (2022: £643,770). The Parent Company financial statements were approved and authorised for issue by the Board on
9 April 2024.
The Notes on pages 89 to 90 form part of these Parent Company financial statements.
By order of the Board
JAMES BARDER
Chief Executive
Futura Medical plc Annual Report 2023 | 87
Parent Company Statement of Changes in Equity
for the year ended 31 December 2023
At 1 January 2022
Total comprehensive loss for the year
Share-based payment
Shares issued during the year
Transactions with owners
At 31 December 2022
Total comprehensive loss for the year
Share-based payment
Shares issued during the year
Warrant exercise
Transactions with owners
At 31 December 2023
Notes
5
17
16
18
Share
Capital
£
574,302
–
–
1,791
1,791
576,093
–
–
4,844
21,875
26,719
Share
Premium
£
66,378,003
–
–
167,793
167,793
66,545,796
–
–
170,024
4,353,125
4,523,149
Warrant
Reserve
£
165,868
–
–
–
–
165,868
–
–
–
(165,868)
(165,868)
Retained
Losses
£
Total
Equity
£
(117,711) 67,000,462
(643,770)
671,852
169,584
841,436
(643,770)
671,852
–
671,852
(89,629)
(562,024)
2,720,297
–
165,868
2,886,165
67,198,128
(562,024)
2,720,297
174,868
4,375,000
7,270,165
602,812
71,068,945
–
2,234,512
73,906,269
Share premium represents amounts subscribed for share capital in excess of nominal value, less the related costs of share issues.
Warrants issued are held as a separate “warrant reserve” within equity. The warrant reserve will be transferred to retained earnings on exercise or lapse, as it is treated as distributable
profit from the point of issue.
Profit and loss account represents the cumulative net profit recognised. The total comprehensive loss for the year represents the total recognised income and expense for the year.
The Notes on pages 89 to 90 form part of these Parent Company financial statements.
Futura Medical plc Annual Report 2023 | 88
Notes to the Parent Company Financial Statements
for the year ended 31 December 2023
1. ACCOUNTING POLICIES
• the disclosure of the remuneration of key management
Warrants
The Parent Company financial statements have been
prepared on a going concern basis and under the
historical cost convention and have been prepared and
approved by the Directors in accordance with Financial
Reporting Standard 101 “Reduced Disclosure Framework”
(“FRS 101”). The principal accounting policies applied
in the preparation of the financial information and
where advantage of the FRS 101 disclosure exemptions
have been taken are set out below. These policies have
been consistently applied to all years presented, unless
otherwise stated.
Monetary amounts in these financial statements
are rounded to the nearest pound sterling (£), unless
otherwise stated, which is also the functional currency of
the Company.
As a Consolidated Statement of Comprehensive Loss
is published, no separate statement of comprehensive
loss for the Parent Company has been included in these
financial statements, as permitted by section 408 of
the Companies Act 2006. The loss in respect of the
Company for the year was £562,024 (2022: £643,770). The
remuneration of the Directors of the Company is disclosed
in Note 7 to the consolidated financial statements.
Auditor’s remuneration is disclosed in Note 6 to the
consolidated financial statements.
Disclosure exemptions adopted
In preparing these financial statements the Company has
taken advantage of all disclosure exemptions conferred
by FRS 101. Therefore, these financial statements do not
include:
• certain comparative information as otherwise required
by UK endorsed IFRS;
• financial instrument disclosures;
• certain disclosures regarding the Company’s capital;
• a statement of cash flows;
• the effect of future accounting standards not yet
adopted;
personnel;
• disclosure of related party transactions with other wholly
owned members of the Group; and
• disclosure of impairment of assets.
The Company’s financial position and performance
is included in the consolidated financial statements
presented on pages 67 to 86.
The Company may issue warrants from time to time in
conjunction with equity instruments. Where warrants
are issued, the fair value of the warrants are determined
using the Black–Scholes method and the balance held
in a warrant reserve until such time the warrants are
exercised or lapse. The warrant reserve will be transferred
to retained earnings on exercise or lapse, as it is treated as
distributable profit reserve from the point of issue.
Non-derivative financial instruments
Taxation
Tax on the profit or loss for the year comprises current
and deferred tax. Tax is recognised in the profit and
loss account except to the extent that it relates to items
recognised directly in equity or other comprehensive loss,
in which case it is recognised directly in equity or other
comprehensive loss.
Current tax is the expected tax payable or receivable on the
taxable profit or loss for the year, using tax rates enacted or
substantively enacted at the balance sheet date, and any
adjustment to tax payable in respect of previous years.
A deferred tax asset is recognised only to the extent that
it is probable that future taxable profits will be available
against which the temporary difference can be utilised.
Non-derivative financial instruments comprise
investments in equity, trade and other debtors, cash and
cash equivalents and trade and other creditors.
Trade and other receivables
Trade and other debtors are recognised initially at fair
value. Subsequent to initial recognition they are measured
at amortised cost using the effective interest method, less
any impairment losses.
Trade and other payables
Trade and other creditors are recognised initially at fair
value. Subsequent to initial recognition they are measured
at amortised cost using the effective interest method.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and
treasury fund units.
Share-based employee remuneration
The Company has no employees but does issue shares
to satisfy share option awards made by its subsidiary
company Futura Medical Developments Limited.
The grant date fair value of share-based payments awards
granted to employees is recognised as an increase
in the investment, with a corresponding increase in
equity, over the period in which the employees become
unconditionally entitled to the awards. The fair value of
the awards granted is measured using the Black–Scholes
model, taking into account the terms and conditions upon
which the awards are granted.
Futura Medical plc Annual Report 2023 | 89
Notes to the Parent Company Financial Statements
for the year ended 31 December 2023
2. INVESTMENT IN SUBSIDIARY
3. TRADE RECEIVABLES
The investment represents 100% of the issued ordinary
£1 shares in the subsidiary undertaking Futura Medical
Developments Limited whose registered address is:
40 Occam Road, Guildford, Surrey GU2 7YG. The principal
activity of Futura Medical Developments Limited is the
research and commercialisation of consumer healthcare
products. The investment is stated at cost plus amounts
capitalised in respect of the intercompany receivable,
less accumulated impairment losses. The results of the
subsidiary are included in the consolidated financial
statements. The Company capitalises intercompany
balances with its subsidiaries at each month-end (creating
an investment in subsidiaries) up to the point where
it believes the subsidiary is in a position to repay any
balances within the next 12 months. Capitalised balances
are reviewed for impairment annually. It was concluded
that there was no impairment required.
At 1 January 2022
Additions in the year
At 31 December 2022
Additions in the year
At 31 December 2023
£
58,427,010
6,817,555
65,244,565
4,836,377
70,080,942
Futura Medical Developments Limited owns 100% of the
issued ordinary £1 shares of Futura Consumer Healthcare
Limited whose registered address is: 40 Occam Road,
Guildford, Surrey GU2 7YG. The principal activity of
Futura Consumer Healthcare Limited is the commercial
exploitation and branding of pharmaceutical drugs
and medical devices developed by Futura Medical
Developments Limited. This is an indirect investment and
Futura Consumer Healthcare Limited has been dormant
since the start of 2018.
Amounts receivable within one year: prepayments
VAT receivable
4. TRADE PAYABLES
Trade creditors
Accruals
5. CALLED UP SHARE CAPITAL
Allotted, called up and fully paid
Ordinary shares of 0.2 pence each
31 December
2023
£
34,163
16,356
50,519
31 December
2022
£
12,812
–
12,812
31 December
2023
£
116,742
65,370
182,112
31 December
2022
£
80,318
69,315
149,633
31 December
2023
Number
301,405,950
31 December
2022
Number
288,046,527
31 December
2023
£
602,812
31 December
2022
£
576,093
Details of shares issued by the Company in the year and details of share options outstanding are given in Notes 16 and 17
to the consolidated financial statements.
6. RELATED PARTY TRANSACTIONS
The Company has taken the exemption in line with FRS 101 not to disclose related party transactions between wholly
owned subsidiaries.
Futura Medical plc Annual Report 2023 | 90
Company Information
COMPANY NUMBER
04206001
DIRECTORS
John Clarke
Jeff Needham
James Barder
Angela Hildreth
Ken James
Andrew Unitt
Non-Executive Chairman1
Non-Executive Director/ Non-Executive Chairman2
Chief Executive Officer
Finance Director and Chief Operating Officer
Executive Director
Non-Executive Director
1 Appointment ended July 2023.
2 Appointment to Non-Executive Chairman July 2023.
COMMITTEE MEMBERS SERVING DURING THE YEAR WERE:
Audit
committee
Andrew Unitt
John Clarke
Secretary and registered
office
Angela Hildreth
Futura Medical plc
Surrey Technology Centre
40 Occam Road
Guildford
Surrey
GU2 7YG
Nominated adviser
and broker
Liberum Capital Limited
25 Ropemaker Street
London
EC2Y 9LY
Remuneration
committee
Jeff Needham
John Clarke
Andrew Unitt
Nominations
committee
John Clarke
Andrew Unitt
Auditor
Registrar
Grant Thornton UK LLP
2nd Floor
St John’s House
Haslett Avenue West
Crawley
RH10 1HS
Link Group
Unit 10
Central Square
29 Wellington Street
Leeds
LS1 4DL
Joint broker
Patent attorney
Public relations adviser
Principal banker
Stifel Nicolaus Europe LTD
150 Cheapside
London
EC2V 6ET
Withers & Rogers LLP
2 London Bridge Road
London
SE1 9RA
Alma Strategic
Communications
71 -73 Carter Lane
London
EC4V 5EQ
HSBC Bank
12A North Street
Guildford
GU1 4AF
Futura Medical plc Annual Report 2023 | 91
Futura Medical plc Annual Report 2023 |
Futura Medical plc
Surrey Technology Centre
40 Occam Road
Guildford
Surrey
GU2 7YG
Tel: +44 (0) 1483 685 670
Email: info@futuramedical.com
Website: www.futuramedical.com