|Agennix AG Reports Financial Results For Fiscal Year 2011|
Provides update on lead product candidate, oral talactoferrin
Torsten Hombeck, Ph.D., Chief Financial Officer and Spokesperson of the Management Board, said: “Our efforts in 2011 focused on advancing the development of our lead product candidate, the first-in-class oral Dendritic Cell Mediated Immunotherapy, talactoferrin. We are preparing for success and have been putting in place key elements to achieve our goals while keeping a watchful eye on what we spend. Prior to Phase III data from our ongoing FORTIS-M trial, which we now expect in the July/August 2012 timeframe, we are investing only in those activities that we believe are on the critical path for a timely and successful regulatory submission and potential product launch.”
Fiscal year 2011 compared to fiscal year 2010
The Company did not recognize any revenues in 2011 compared to € 0.2 million recognized in 2010. Research and development expenses were € 36.6 million for the year ended December 31, 2011, compared with € 29.4 million for the same period in 2010. The increase in R&D expenses was primarily due to increased patient enrollment in the Phase III FORTIS-M trial with talactoferrin in non-small cell lung cancer (NSCLC) and the Phase II portion of the OASIS trial with talactoferrin in severe sepsis, which was initiated at the end of the second quarter of 2011 and stopped in the first quarter of 2012. Administrative expenses were € 8.8 million for the year ended December 31, 2011, compared to € 10.0 million for the same period in 2010. The decrease was primarily due to decreases in legal expenses related to shareholder litigation and variable employee compensation expense, neither of which were incurred in 2011. Net loss in 2011 was € 41.8 million compared to € 27.0 million for the preceding year. Net loss before income tax benefit was € 42.6 million in 2011 compared to € 36.5 million in 2010. Income tax benefit for the year ended December 31, 2011 was € 0.8 million (€ 9.5 million for the same period in 2010) and related to the net operating losses incurred by the Company’s subsidiary, Agennix Incorporated, during the period. Basic and diluted loss per share was € (0.98) for 2011 compared to € (1.07) for 2010.
At December 31, 2011, the Company had cash, cash equivalents, other current financial assets and restricted cash of € 44.0 million (2010: € 79.3 million). Net cash burn for 2011 was € 45.8 million (2010: € 34.5 million), with net cash burn of € 11.5 million in the first quarter, € 11.6 million in the second quarter, € 11.8 million in the third quarter and € 10.9 million in the fourth quarter of 2011. Net cash burn is derived by adding net cash used in operating activities and purchases of property, equipment and intangible assets. The figures used to calculate net cash burn are contained in the Company’s respective consolidated statements of cash flows.
Comparison to previous year: fourth quarter 2011 compared to fourth quarter 2010
The Company did not recognize any revenues for the three months ended December 31, 2011 or 2010. R&D expenses for the fourth quarter of 2011 were € 12.0 million compared to € 9.5 million for the fourth quarter of 2010. Administrative expenses for the fourth quarter of 2011 were € 2.2 million compared to € 3.6 million for the same quarter in 2010. Net loss for the fourth quarter of 2011 was € 16.7 million compared to € 7.6 million for the fourth quarter of 2010. Net loss before income tax expense/benefit was € 10.3 million for the fourth quarter of 2011 compared to € 10.2 million for the fourth quarter of 2010. Basic and diluted loss per share was € (0.37) for the fourth quarter of 2011 compared to € (0.19) for the same period in 2010.
Quarter over quarter results: fourth quarter 2011 compared to third quarter 2011
The Company did not recognize any revenues for the fourth quarter or third quarter of 2011. R&D expenses were € 12.0 million for the fourth quarter of 2011 compared to € 8.1 million for the third quarter of 2011. Administrative expenses for the fourth quarter of 2011 were € 2.2 million compared to € 2.1 million for the previous quarter. The Company had a net loss of € 16.7 million in the fourth quarter of 2011 compared to € 8.2 million for the previous quarter. Net loss before income tax expense/benefit was € 10.3 million in the fourth quarter of 2011 compared to € 9.7 million for the third quarter of 2011. Basic and diluted loss per share was € (0.37) for the fourth quarter of 2011 compared to € (0.20) for the previous quarter.
Agennix also provided an update on its lead product candidate, the oral Dendritic Cell Mediated Immunotherapy (DCMI), talactoferrin.
The Company reported that top-line results from the ongoing FORTIS-M trial in NSCLC patients whose disease has progressed following two or more prior therapies are now expected in the July/August 2012 timeframe, rather than in the second quarter of 2012 as previously anticipated. The change is due to the fact that the analysis of the FORTIS-M data is event driven and the rate at which events have occurred to date is slower than previously projected. The number of events needed to perform the analysis has not yet been reached.
Agennix reported that its review of the available results from the OASIS Phase II/III trial with talactoferrin in severe sepsis confirmed the finding of the trial’s Data Safety Monitoring Board (DSMB), which had recommended that the study be stopped. The Company reported that the latest data from the trial, which incorporates additional patients’ data that were not available to the DSMB at the time of its analysis, indicate that 28-day all-cause mortality, the primary endpoint of the study, in the talactoferrin arm was 25% compared to 18% in the placebo group. This difference was not statistically significant. These results were based on 305 patients treated in the study, with 153 in the talactoferrin group and 152 in the placebo group. No other safety issues have been identified to date.
Further evaluation of apparent differences in some baseline characteristics between the two arms in the OASIS trial is ongoing. Women in the talactoferrin arm, particularly those with cardiovascular dysfunction (septic shock), had an apparent higher 28-day mortality compared to women in the placebo arm. Male patients without cardiovascular dysfunction who received talactoferrin had an apparent lower 28-day mortality than those who received placebo. Further analyses are ongoing to more fully understand the findings.
The above results are still preliminary and subject to change. The final results from the OASIS trial are expected to be presented at a medical meeting later in the year.
Once the ongoing data review is completed and Agennix has held further discussions with the critical care community and consultants, the Company will make a decision on whether further development of talactoferrin in severe sepsis is warranted. Until that time, Agennix does not intend to invest further in the development of talactoferrin in severe sepsis.
The Company has discussed the results of the OASIS trial with the DSMB of the FORTIS trials. The FORTIS DSMB has agreed with Agennix’s assessment that, based on the available data from the OASIS trial, no changes to the conduct of the ongoing FORTIS-M trial are necessary and the trial can continue as planned.
Agennix provided the following updated financial guidance. The Company’s financial outlook for 2012 and 2013 is highly dependent on the outcome of the FORTIS-M Phase III trial in NSCLC.
Revenues: Management expects no substantial cash-generating revenues for 2012 and 2013. This guidance does not consider any potential cash revenue from future partnering of talactoferrin due to the uncertainty of the timing of such events. If the FORTIS-M trial is positive, Agennix plans to submit a Biologics License Application (BLA) to the U.S. Food & Drug Administration (FDA), and a Marketing Authorization Application (MAA) to the European Medicines Agency (EMA), requesting marketing approval of talactoferrin.
R&D expenses: The Company expects R&D expenses for the first half of 2012 to be in line with the first half of 2011. For the second half of 2012 and for 2013, R&D expenses are dependent on the outcome of the FORTIS-M trial. Should the FORTIS-M trial be positive, the Company would expect to incur additional costs related to regulatory filings and increased manufacturing costs in preparation for a potential market launch. In addition, in such a positive scenario, Agennix is likely to expand its clinical development activities.
Administrative expenses: Administrative expenses in 2012 and 2013 are expected to increase compared to 2011 as the Company expects to ramp up certain critical pre-commercialization activities for a potential market launch of talactoferrin. Should the FORTIS-M trial be positive, these activities and related expenses would increase significantly, potentially including costs related to beginning to build a commercial infrastructure in the U.S.
Cash position: Management believes that Agennix will have sufficient cash to fund its operations into the first quarter of 2013. This should enable the Company to obtain top-line data from the FORTIS-M trial, now expected in July/August 2012, assuming no significant changes to currently projected timelines, and to significantly advance potential partnering discussions. The Company will need to raise additional funds through licensing agreements and/or through strategic and/or public equity or debt investments to fund the Company’s operations beyond that point.
2012 corporate calendar
The Company reported the dates for its 2012 corporate calendar as follows:
First quarter financial results: May 9
Annual Shareholders Meeting: June 15 (previously August 7)
Second quarter financial results: July 31
Third quarter financial results: November 8
Conference call scheduled
As previously announced, the Company has scheduled a conference call to which participants may listen via live webcast, accessible through the Agennix Web site at www.agennix.com or via telephone. A replay will be available via the Web site following the live event. The call, which will be conducted in English, will be held today, March 15th at 14:00 CET/9:00 AM EDT. The dial-in numbers for the call are as follows:
Participants from Europe:
0044 (0)20 3003 2666
Participants from the U.S.:
Please dial in 10 minutes before the beginning of the call.
Agennix AG is a publicly listed biopharmaceutical company that is focused on the development of novel therapies that have the potential to substantially improve the length and quality of life of critically ill patients in areas of major unmet medical need. The Company’s most advanced program is talactoferrin, a first-in-class oral Dendritic Cell Mediated Immunotherapy (DCMI). Talactoferrin is currently in Phase III clinical trials in non-small cell lung cancer. Other clinical development programs include RGB-286638, a multi-targeted kinase inhibitor in Phase I testing for cancer, and a topical gel form of talactoferrin for diabetic foot ulcers. Agennix’s registered seat is in Heidelberg, Germany. The Company has three sites of operation: Planegg/Munich, Germany; Princeton, New Jersey and Houston, Texas. For additional information, please visit the Agennix Web site at www.agennix.com.
This press release contains forward-looking statements, which express the current beliefs and expectations of the management of Agennix AG, including statements about the Company’s future cash position and the timing of clinical trial results. Such statements are based on current expectations and are subject to risks and uncertainties, many of which are beyond our control, that could cause future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Actual results could differ materially depending on a number of factors, and we caution investors not to place undue reliance on the forward-looking statements contained in this press release. The achievement of positive results in early stage clinical studies does not ensure that later stage or large scale clinical studies will be successful. Even if the results from our later stage trials with talactoferrin, including the ongoing FORTIS-M trial in non-small cell lung cancer, are considered positive, there can be no guarantee that they will be sufficient to gain marketing approval in the United States or any other country, and regulatory authorities may require additional information, data and/or further pre-clinical or clinical studies to support approval. In such event, there can be no guarantee that the Company will have or be able to obtain the financial resources to conduct any such additional studies or that such studies will yield results sufficient for approval. Forward-looking statements speak only as of the date on which they are made and Agennix undertakes no obligation to update these forward-looking statements, even if new information becomes available in the future.
Agennix™ is a trademark of the Agennix group.