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8-K - FORM 8-K - SELLAS Life Sciences Group, Inc. | b87734e8vk.htm |
Exhibit 99.1
RXi Pharmaceuticals Provides Update and
Reports Financial Results for Q2 2011
Reports Financial Results for Q2 2011
| NeuVax (E75) makes significant progress towards initiating the Phase 3 PRESENT (Prevention of Recurrence in Early-Stage, Node-Positive Breast Cancer with Low to Intermediate HER2 Expression with NeuVax Treatment) study in 1H, 2012 |
WORCESTER, Mass., August 15, 2011 RXi Pharmaceuticals Corporation (NASDAQ: RXII), a
biotechnology company focused on discovering, developing and commercializing innovative therapies
addressing major unmet medical needs using targeted biotherapeutics, today reported its financial
results for the quarter ended June 30, 2011.
RXi currently is focusing its effort primarily on its lead product, NeuVax (E75), a peptide-based
immunotherapy. The company expects to initiate its Phase 3 PRESENT (Prevention of
Recurrence in Early-Stage, Node-Positive Breast Cancer with Low to
Intermediate HER2 Expression with NeuVax Treatment) study in the first
half of 2012 under a Special Protocol Assessment (SPA) from the U.S. Food and Drug Administration
(FDA).
Recent Highlights
Since RXis acquisition of NeuVax in April 2011, the Company has aggressively completed several
operational steps towards initiating the Phase 3 PRESENT trial including:
| Dr. Beth Mittendorf announced as the Phase 3 Principle Investigator. Elizabeth A. Mittendorf, MD, Assistant Professor in the Department of Surgical Oncology at the University of Texas M. D. Anderson Cancer Center (MDACC). At MDACC, Dr. Mittendorf focuses both her clinical and non-clinical (i.e., laboratory) efforts on the study of breast cancer with a specific interest in breast cancer immunotherapy. Her laboratory work is focused on identifying novel tumor antigens and investigating aspects of the tumor microenvironment that impact the response to anti-cancer vaccination. Dr Mittendorf has published extensively on breast cancer immunotherapy as well as on subjects related to the clinical management of breast cancer patients, | ||
| Phase 3 site IRB approvals obtained. Obtained conditional Institutional Review Board approval of the NeuVax protocol from two sites; a total of at least five key sites are targeted for approval in Q4 2011, | ||
| Clinical Research Organization (CRO) selected to manage the international, multicenter Phase 3 PRESENT trial, and | ||
| Product manufacturing filings completed. Submitted manufacturing amendment to the U.S. Food and Drug Administration (FDA), as well as initiated preparation of final Phase 3 clinical trial drug product. |
In just over three months since the acquisition of NeuVax, we have made significant progress
towards advancing into a pivotal Phase 3 trial to address a large patient population where there is
currently a significant unmet medical need, stated Mark J. Ahn, PhD, President and Chief Executive
Officer of RXi Pharmaceuticals. In addition, during the first half of 2011, RXi raised over $18
million of capital and
has successfully completed a rapid transition from a research company to a late clinical stage
development company.
Clinical Data Presentations:
| Presented positive 36-month data from the NeuVax Phase 2 trial at the American Society of Clinical Oncology (ASCO) annual meeting. Patients in the Phase 3 target patient population maintained a strong response to NeuVax with a 0% recurrence in the treated group versus 22.2% in the untreated group, demonstrating statistical significance. NeuVax continued to demonstrate an excellent safety profile with no serious adverse events. | ||
| Presented Phase 2 data from the combination of NeuVax and Herceptin® in HER2 3+ patients at ASCO. The HER2 3+ patients in the study who received NeuVax in combination with Herceptin indicated no relapses in the patient population, when compared to a relapse rate of about 13% for patients who received Herceptin only, which is consistent with historical norms for this patient population. This data represents a potential improvement to the current standard of care for this patient population, and a possible expansion of the target patient population for NeuVax in the future. |
Corporate:
| Strengthened NeuVax patent portfolio. Acquired two additional patents covering worldwide rights to develop and commercialize NeuVax (E75) in combination with trastuzumab (Herceptin®; Genentech/Roche); and use in low-to-intermediate HER2+ breast cancer patients not eligible for Herceptin therapy. | ||
| Awarded a total of $578,000 in National Institutes of Health (NIH) Grants to Advance RNAi Therapeutics. Awarded two Small Business Innovation Research grants from the NIH focused on the preclinical development of novel RNAi therapeutics for amyotrophic lateral sclerosis (ALS) and other neurodegenerative disorders, as well as funding for a project seeking to improve the delivery of RNAi therapeutics through medicinal chemistry. | ||
| RXi Pharmaceuticals and the University of Massachusetts Medical School (UMMS) Announce Massachusetts Life Sciences Center Cooperative (MLSC) Research Grant for RNAi Therapeutics for ALS. The grant will contribute towards funding an ongoing collaboration between UMMS and RXi to develop a new treatment for ALS using RXIs proprietary self-delivering RNAi therapeutic platform (sd-rxRNA). The MLSC grant amount is $250,000 per year for two years, and subject to a formalized agreement between the parties, matched dollar for dollar by RXi, totaling to up to $500,000 in funding for this project. | ||
| Completed $12 million public offering to accelerate the Phase 3 PRESENT trial. |
Quarterly Financial Highlights:
Cash, Cash Equivalents and Short-Term Investments
As of June 30, 2011, cash, cash equivalents and short-term investments totaled $17.9 million,
compared with cash and cash equivalents of $6.9 million at December 31, 2010. This $11.0 million
increase is
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attributable to the closing of two underwritten public offerings that provided net cash proceeds of
approximately $18.2 million after underwriting fees and other estimated offering expenses (the
March 2011 offering of net proceeds of $7.3 million and the April 2011 offering of net proceeds of $10.9
million), offset by net cash used in operating activities of $7.2 million for the six months ended
June 30, 2011.
Net Loss
Net loss for the three months ended June 30, 2011 was $1.4 million or $0.04 per basic and diluted
share, compared with a net loss of $2.1 million, or $0.12 per basic and diluted share, for the
comparable period in 2010. RXi also reported a net loss of $5.2 million, or $0.18 per basic and
diluted share, for the six months ended June 30, 2011, compared with a net loss of $6.0 million, or
$0.35 per basic and diluted share, for the six months ended June 30, 2010. The decrease in net loss
for the three and six months ended June 30, 2011 compared to the same periods in the prior year was
primarily attributable to the non-cash expense as a result of the change in fair value of warrant
liability of $3.2 million and $4.7 million, respectively, which was primarily due to changes in our
Black-Scholes assumptions.
Net loss from operations decreased to $4.6 million in the second quarter of 2011 from $4.8 million
in the second quarter of 2010, and increased to $9.9 million for the six months ended June 30, 2011
compared to $9.2 million for the comparable period in 2010. This decrease of $0.2 million, or 4%,
in net loss from operations for the quarter ended June 30, 2011 compared to the quarter ended June
30, 2010 was primarily due to a $1.2 million decrease in non-cash equity compensation offset by an
increase of $1.0 million in research and development expenses, as noted below. The increase of
$0.7 million, or 8%, in net loss from operations for the six months ended June 30, 2011 compared to
six months ended June 30, 2010 was primarily the result of a decrease of $1.2 million in non-cash
equity compensation offset by a $1.5 million increase in research and development expenses and an
increase of $0.4 million in general and administrative expenses, as noted below.
Research and Development Expense
Research and development expenses increased to $2.7 million in the second quarter of 2011 from $2.3
million in the second quarter of 2010, and increased to $4.8 million for the first six months of
2011 from $4.2 million for the first six months of 2010. The increase in research and development
expenses for the second quarter of 2011 compared with the second quarter of 2010 of $0.4 million,
or 17%, was primarily due to an increase of $1.0 million in research and development cash expenses
due to a ramp up in NeuVax-related consulting fees and activities in our progression toward
releasing NeuVax off clinical hold offset by a decrease of $0.7 million in non-employee non-cash
stock based compensation related to a change in our Black-Scholes assumptions and $0.1 million in employee
non-cash stock based compensation. The increase of $0.6 million, or 15% for the six months ended
June 30, 2011 compared to the six months ended June 30, 2010 was primarily due to an increase of
$1.5 million in research and development cash expenses primarily related to the ramp-up in
NeuVax-related development activities, which was partially offset by a decrease of $0.8 million in
non-employee non-cash stock based compensation and a $0.1 million decrease in employee non-cash
stock based compensation.
General and Administrative Expenses
General and administrative expenses decreased to $1.9 million in the second quarter of 2011 from
$2.5 million in the second quarter of 2010, and increased to $5.1 million for the first six months
of 2011 from
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$5.0 million for the first six months in 2010. The decrease in general and administrative
expenses for the second quarter of 2011 compared with the second quarter of 2010 of $0.6 million,
or 24%, was primarily due to a $0.3 million decrease in non-cash employee stock based compensation and a $0.2 million
decrease in non-cash stock based compensation expense related to a change in our Black-Scholes
assumptions. Excluding these non-cash items, general and administrative expenses decreased to $1.6
million for the quarter ended June 30, 2011 from $1.7 million for the quarter ended June 30,
2010. The decrease of $0.1 million was primarily due to a decrease in headcount offset by severance
payments in connection with a reduction in force. The decrease of $0.1 million, or 2%, for the six
months ended June 30, 2011 compared to the six months ended June 30, 2010 was primarily due to a
$0.4 million decrease in non-cash stock based compensation related to a warrant issued for business
advisory services offset by a $0.1 million increase in non-cash stock based compensation.
Excluding these non-cash items, general and administrative expenses increased to $3.5 million for
the six months ended June 30, 2011 from $3.1 million for the six months ended June 30, 2010. This
increase of $0.4 million was primarily due to severance payments in connection with a reduction in
force.
About NeuVax (E75)
NeuVax consists of the Her2/neu (E75) peptide derived from HER2 combined with the immune adjuvant
granulocyte macrophage-colony stimulating factor. Treatment with NeuVax stimulates cytotoxic
(CD8+) T cells in a highly specific manner to target cells expressing any level of HER2. NeuVax is
given as an intradermal injection once a month for six months, followed by a booster injection once
every six months. Based on a successful Phase 2 trial, which achieved its primary endpoint of
disease-free survival, the FDA granted NeuVax a Special Protocol Assessment for its Phase 3 PRESENT
(Prevention of Recurrence in Early-Stage, Node-Positive Breast Cancer with Low to Intermediate HER2
Expression with NeuVax Treatment) study. This Phase 3multicenter trial is expected to commence in
the first half of 2012.
According to the National Cancer Institute, over 200,000 women in the U.S. are diagnosed with
breast cancer annually. Of these women, about 75% test positive for Human Epidermal growth factor
Receptor 2 (IHC 1+, 2+ or 3+). Only 25% of all breast cancer patients, those with HER2 3+ disease
are eligible for Herceptin® (trastuzumab; Roche-Genentech) which had revenues of over $5 billion in
2010. NeuVax targets the remaining 50% of HER2 positive patients (HER2 1+ and 2+) who achieve
remission with current standard of care, but have no available HER2 targeted adjuvant treatment
options to maintain their disease free status.
About RXI-109
RXi has initiated development of clinical candidate RXI-109, a self-delivering RNAi compound
(sd-rxRNA) for the reduction of dermal scarring in planned surgeries. RXI-109 is designed to reduce
the expression of CTGF (connective tissue growth factor), a critical regulator of several
biological pathways involved in fibrosis, including scar formation in the skin. RXi has
manufactured RXI-109 with an experienced cGMP oligonucleotide manufacturer to support its IND
enabling toxicology program and the planned clinical trial. Pending FDA review, the Company intends
to use an innovative clinical trial design to study safety and tolerability as well as initial
efficacy in its first clinical trial targeted for 2012.
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About RXi Pharmaceuticals Corporation
RXi Pharmaceuticals Corporation (NASDAQ: RXII) is a biotechnology company focused on discovering,
developing and commercializing innovative therapies using targeted biotherapeutics thus addressing
major unmet medical needs. For more information, visit www.rxipharma.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about
the future expectations, plans and prospects of the development of RXi Pharmaceuticals
Corporations products. These forward-looking statements about future expectations, plans and
prospects of the development of the Companys products are subject to a number of risks,
uncertainties and assumptions, including those identified under Risk Factors in the Companys
most recently filed Annual Report on Form 10-K, Quarterly Report on Form 10-Q and in other filings
the Company periodically makes with the SEC. Actual results may differ materially from those
contemplated by these forward-looking statements. The Company does not undertake to update any of
these forward-looking statements to reflect a change in its views or events or circumstances that
occur after the date of this presentation.
RXi PHARMACEUTICALS
CORPORATION
(A Development Stage Company)
CONDENSED CONSOLIDATED STATEMENTS OF EXPENSES
(Amounts in thousands, except share and per share data)
(Unaudited)
CORPORATION
(A Development Stage Company)
CONDENSED CONSOLIDATED STATEMENTS OF EXPENSES
(Amounts in thousands, except share and per share data)
(Unaudited)
For the Three | For the Three | For the Six | For the Six | |||||||||||||
Months Ended | Months Ended | Months Ended | Months Ended | |||||||||||||
June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | |||||||||||||
Research and development
expense |
$ | 2,673 | $ | 2,264 | $ | 4,833 | $ | 4,190 | ||||||||
General and administrative
expense |
1,949 | 2,490 | 5,068 | 5,020 | ||||||||||||
Operating loss |
(4,622 | ) | (4,754 | ) | (9,901 | ) | (9,210 | ) | ||||||||
Other income (expense), net |
3,240 | 2,613 | 4,674 | 3,183 | ||||||||||||
Net loss |
$ | (1,382 | ) | $ | (2,141 | ) | $ | (5,227 | ) | $ | (6,027 | ) | ||||
Net loss per common share: |
||||||||||||||||
Basic and diluted loss per
share |
($0.04 | ) | ($0.12 | ) | ($0.18 | ) | ($0.35 | ) | ||||||||
Weighted average common
shares outstanding: |
||||||||||||||||
Basic and diluted |
38,568,501 | 18,371,808 | 29,492,756 | 17,384,606 |
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RXi PHARMACEUTICALS CORPORATION
(A Development Stage Company)
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share data)
(Unaudited)
(A Development Stage Company)
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share data)
(Unaudited)
June 30, | December 31, | |||||||
2011 | 2010 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 17,933 | $ | 6,891 | ||||
Prepaid expenses and other current assets |
259 | 150 | ||||||
Total current assets |
18,192 | 7,041 | ||||||
Equipment and furnishings, net |
436 | 419 | ||||||
In-process research and development |
12,864 | | ||||||
Goodwill |
845 | | ||||||
Deposits |
6 | 16 | ||||||
Total assets |
$ | 32,353 | $ | 7,476 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 1,065 | $ | 724 | ||||
Accrued expenses and other current liabilities |
1,785 | 1,113 | ||||||
Deferred Revenue |
578 | | ||||||
Current maturities of capital lease obligations |
59 | 51 | ||||||
Fair value of stock options modified |
682 | | ||||||
Fair value of warrants potentially settleable in cash |
11,882 | 3,138 | ||||||
Current contingent purchase price consideration |
768 | | ||||||
Total current liabilities |
16,819 | 5,026 | ||||||
Capital lease obligations, net of current maturities |
10 | 20 | ||||||
Contingent purchase price consideration, net of current portion |
5,664 | | ||||||
Total liabilities |
22,493 | 5,046 | ||||||
Total stockholders equity |
9,860 | 2,430 | ||||||
Total liabilities and stockholders equity |
$ | 32,353 | $ | 7,476 | ||||
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RXi Pharmaceuticals
Tamara McGrillen
508-929-3615
ir@rxipharma.com
Tamara McGrillen
508-929-3615
ir@rxipharma.com
or
Remy Bernarda
IR Sense, LLC
415-203-6386
remy@irsense.com
IR Sense, LLC
415-203-6386
remy@irsense.com
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