All amounts are in US dollars
QUEBEC CITY, March 17, 2015 /CNW Telbec/ - Aeterna Zentaris
Inc. (NASDAQ: AEZS) (TSX: AEZ) (the "Company"), a specialty
biopharmaceutical company engaged in developing and commercializing
novel treatments in oncology, endocrinology and women's health,
today reported financial and operating results as at and for the
fourth quarter and the year ended December
31, 2014.
Research and development ("R&D") costs, net of refundable
tax credits and grants, were $6.3
million and $23.7 million for
the three-month period and the year ended December 31, 2014,
respectively, as compared to $5.3
million and $21.3 million for
the same periods in 2013. The increase for the year ended
December 31, 2014, as compared to the
same period in 2013, is attributable to higher comparative employee
compensation and benefits costs, which in turn are mainly due to
the recording of R&D restructuring costs of approximately
$2.5 million related to R&D staff
redundancies resulting from the Company's global resource
optimization program (the "Resource Optimization Program"), partly
offset by lower comparative salaries, short-term employee benefits
and share-based compensation costs.
Selling, general and administrative ("SG&A") expenses
were $4.7 million and $13.7 million for the three-month period and the
year ended December 31, 2014, respectively, compared to
$2.6 million and $12.3 million for the same periods in 2013. For
the three-month period ended December 31,
2014, the increase in SG&A expenses, as compared to the
same period in 2013, is mainly related to the deployment of the
Company's contracted sales force, which is currently detailing
EstroGel®, and higher comparative operating foreign
exchange losses. For the year ended December 31, 2014, the increase in SG&A
expenses, as compared to the same period in 2013, is mainly related
to higher comparative operating foreign exchange losses, the
ramping up of the Company's pre-commercialization activities, the
deployment of its contracted sales force related to its
co-promotion activities and to the recording of restructuring costs
related to administrative staff redundancies resulting from the
Resource Optimization Program.
Net income (loss) for the three-month period and the year
ended December 31, 2014 was
$4.2 million and $(16.6) million, or $0.06 and $(0.28)
per basic and diluted share, respectively, as compared to
$(8.2) million and $6.8 million, or $(0.22) and $0.24
per basic and diluted share, for the same periods in 2013. The
increase in net income for the three-month period ended
December 31, 2014, as compared to the
same period in 2013, is due largely to higher comparative net
finance income, offset partially by higher comparative operating
expenses and by lower net income from discontinued
operations. The decrease in net income for the year ended
December 31, 2014, as compared to the
same period in 2013, is due largely to the higher loss from
operations and to lower net income from discontinued operations,
partially offset by higher comparative net finance income.
Cash and cash equivalents totaled $34.9 million as at December 31, 2014, as compared to $43.2 million as at December 31, 2013.
David Dodd, Aeterna
Zentaris Chairman and CEO, commented, "During 2014, we achieved
significant progress in the implementation of our strategy of
transitioning into a commercially operating specialty
biopharmaceutical company, as we put our commercial structure in
place, built a full-time contract sales force of 19
representatives, signed a co-promotion agreement with ASCEND and
started selling its product EstroGel® in our specific
territories in the US. We are continuing to evaluate potential
in-licensing and/or acquisition opportunities, as well as
additional co-promotional arrangements related to marketed
products, in order to grow our commercial activities. We are also
proud of our collaboration agreement for our lead oncology
compound, zoptarelin doxorubicin, with Sinopharm A-Think for
China, one of the largest markets
in the world. With regards to our ZoptEC Phase 3 study in
endometrial cancer with zoptarelin doxorubicin, we are very pleased
with the progress of patient recruitment as we now have over 400
patients enrolled in the trial out of an expected total of 500,
which is in line with our projections. Therefore, we expect that at
this rate, a first interim analysis of the trial should be secured
in the first half of the current year, and patient recruitment
should be completed by year-end. As for Macrilen™, following the
FDA's Complete Response Letter, we intend to make a decision in the
near term on our different options for this product in the
evaluation of AGHD. For 2015, we remain fully focused on becoming a
growth-oriented, commercially operating specialty biopharmaceutical
organization, while continuing to develop key late-stage product
candidates in our existing pipeline, such as our novel targeted
anti‑cancer agent, zoptarelin doxorubicin."
Dennis Turpin, Chief Financial
Officer of the Company added, "With our cash and cash equivalents
position of $34.9 million as at
December 31, 2014, our controlled
burn rate and the completion of our recent public offering, which
resulted in net proceeds of approximately $34.5 million, the Company has a solid financial
position upon which it can advance its strategic initiatives."
2014 Highlights
Commercial Developments
- During the fourth quarter, pursuant to the co-promotion
services agreement signed with ASCEND Therapeutics US LLC
("ASCEND") in August 2014, the
Company's own full-time contract sales force of 19 sales
representatives started the field selling of
EstroGel®, ASCEND's leading non-patch transdermal
hormone replacement therapy product, in specific agreed upon US
territories, in exchange for a sales commission.
Product Candidate Developments
Zoptarelin Doxorubicin
- During the year, site initiation was completed, with over 120
sites currently in operation in North
America, Europe and
Israel for the ZoptEC
(Zoptarelin doxorubicin in Endometrial Cancer)
Phase 3 trial in women with locally advanced, recurrent or
metastatic endometrial cancer. To date, over 400 of the expected
500 patients have been entered into the trial.
- On December 1, 2014, the Company
entered into a master collaboration agreement with Sinopharm
A-Think Pharmaceuticals Co., Ltd. ("Sinopharm"), for the
development, manufacture and commercialization of zoptarelin
doxorubicin in the People's Republic of
China, including Hong Kong
and Macau. Aeterna Zentaris
received a one‑time, non-refundable payment of $1.1 million transfer fee from Sinopharm, and
will be entitled to receive additional consideration upon achieving
certain pre-established milestones, including certain regulatory
and commercial events, as well as royalties on future net sales of
zoptarelin doxorubicin in China.
Macrilen™
- On November 6, 2014, the FDA
issued a Complete Response Letter ("CRL") for the Company's New
Drug Application ("NDA") for Macrilen™ in the evaluation of adult
growth hormone deficiency ("AGHD"). Based on its review, the FDA
determined that the NDA could not be approved in its form, as
submitted. To demonstrate the efficacy of macimorelin as a
diagnostic test for growth hormone deficiency, the CRL states that
a new, confirmatory clinical study will be necessary. The CRL also
stated that a serious event of electrocardiogram QT interval
prolongation occurred for which attribution to drug could not be
excluded. Therefore a dedicated thorough QT study to evaluate the
effect of macimorelin on the QT interval would be necessary.
- The Company intends to make a decision regarding the future
development of Macrilen™ in the near term, taking into account
various considerations, including prior and upcoming discussions
with the FDA.
Corporate Developments
Establishment of Global Commercial Operations and Resource
Optimization
- On May 5, 2014, the Company
announced it had selected Charleston,
South Carolina, as the new location for its North American
business and global commercial operations.
- On August 7, 2014, the Company's
Nominating, Governance and Compensation Committee approved its
Resource Optimization Program, as part of its strategy to
transition into a commercially operating specialty
biopharmaceutical organization. The Resource Optimization Program,
the goal of which is to streamline R&D activities and increase
commercial operations and flexibility, is expected to result in the
termination of 30 employees, with employee departures continuing
through August 31, 2015. The Company
expects that overall annualized savings upon completion of the
Resource Optimization Program will amount to approximately
$2.3 million. Total restructuring
costs associated with the Resource Optimization Program recorded
during 2014 were approximately $2.5
million.
Public Offerings
- On January 14, 2014, the Company
completed a public offering of 11.0 million units, generating net
proceeds of approximately $12.2
million, with each unit consisting of one common share and
0.80 of a warrant to purchase one common share, at a purchase price
of $1.20 per unit.
- Subsequent to year-end, on March 11,
2015, the Company completed a public offering of 59,677,420
units, generating net proceeds of approximately $34.5 million, from which the Company paid
approximately $5.7 million to the
holders of approximately 21.1 million outstanding warrants issued
by the Company in previous public offerings as consideration for
their agreement to immediately terminate the warrants. Each unit of
this March 11, 2015 public offering
consists of either one common share or one warrant to purchase one
common share ("Series C Warrant"), 0.75 of a warrant to purchase
one common share ("Series A Warrant") and 0.50 of a warrant to
purchase one common share ("Series B Warrant"), at a purchase
price of $0.62 per unit. The Series A
Warrants are exercisable for a period of five years at an exercise
price of $0.81 per share. The Series
B warrants are exercisable for a period of 18 months at an exercise
price of $0.81 per share. Total gross
proceeds payable to the Company in connection with the exercise of
the Series C Warrants have been pre-paid by investors and therefore
are included in the aforementioned proceeds.
"At-the-Market" Issuance Program
- Between July 1, 2014 and
December 31, 2014, the Company issued
a total of approximately nine million common shares under its
At-the-Market ("ATM") sales agreement entered into May 2014 with MLV & Co. LLC (the
"May 2014 ATM Program"), at an
average price of $1.36 for aggregate
gross proceeds of approximately $12.2
million, less cash and non-cash transaction costs of
approximately $0.4 million. The
May 2014 ATM Program provides that
the Company may, at its discretion, from time to time during the
term of the sales agreement, sell up to a maximum of 14.0 million
of its common shares through ATM issuances on the NASDAQ, up to an
aggregate amount of $15 million.
NASDAQ Minimum Bid Price Compliance
- On December 18, 2014, the Company
received a notice from the NASDAQ regarding its failure to comply
with the NASDAQ's $1.00 minimum bid
price requirement. The Company has 180 calendar days, or until
June 16, 2015, to regain compliance
with the minimum bid price requirement.
CONFERENCE CALL
Management will be hosting a conference call for the investment
community beginning at 8:30 a.m. (Eastern
Time) tomorrow, Wednesday, March 18, 2015, to discuss the
2014 fourth quarter and full year results. Individuals interested
in participating in the live conference call by telephone may dial,
in Canada, 514-807-9895 or
647-427-7450, outside Canada,
888-231-8191. They may also listen through the Internet at
www.aezsinc.com in the "Newsroom" section. A replay will be
available on the Company's website for 30 days following the live
event.
For reference, the Management's Discussion and Analysis of
Financial Condition and Results of Operations for the fiscal year
2014, as well as the Company's consolidated financial statements,
can be found at www.aezsinc.com in the "Investors" section.
About Aeterna Zentaris Inc.
Aeterna Zentaris is a specialty biopharmaceutical company
engaged in developing and commercializing novel treatments in
oncology, endocrinology and women's health. For more information,
visit www.aezsinc.com.
Forward-Looking Statements
This press release contains forward-looking statements made
pursuant to the safe harbor provisions of the US Securities
Litigation Reform Act of 1995. Forward-looking statements involve
known and unknown risks and uncertainties that could cause the
Company's actual results to differ materially from those in the
forward-looking statements. Such risks and uncertainties include,
among others, the availability of funds and resources to pursue
R&D projects, the successful and timely completion of clinical
studies, the risk that safety and efficacy data from any of our
Phase 3 trials may not coincide with the data analyses from
previously reported Phase 1 and/or Phase 2 clinical trials, the
ability of the Company to efficiently commercialize one or more of
its products or product candidates, the ability of the Company to
take advantage of business opportunities in the pharmaceutical
industry, uncertainties related to the regulatory process, the
ability to protect our intellectual property, the potential of
liability arising from shareholder lawsuits and general changes in
economic conditions. Investors should consult the Company's
quarterly and annual filings with the Canadian and US securities
commissions for additional information on risks and uncertainties
relating to forward-looking statements. Investors are cautioned not
to place undue reliance on these forward-looking statements. The
Company does not undertake to update these forward-looking
statements. We disclaim any obligation to update any such factors
or to publicly announce the result of any revisions to any of the
forward-looking statements contained herein to reflect future
results, events or developments, unless required to do so by a
governmental authority or by applicable law.
Attachment: Financial summary
Consolidated
Statements of Comprehensive Income (Loss)
Information
|
|
|
|
|
|
|
|
Three-month
periods
ended December 31,
|
|
Years ended
December 31,
|
(in thousands,
except share and per share data)
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2012
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
—
|
|
—
|
|
—
|
|
96
|
|
834
|
License
fees
|
|
11
|
|
—
|
|
11
|
|
6,079
|
|
1,219
|
|
|
11
|
|
—
|
|
11
|
|
6,175
|
|
2,053
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
—
|
|
—
|
|
—
|
|
51
|
|
591
|
Research and
development costs, net of refundable tax credits and
grants
|
|
6,282
|
|
5,345
|
|
23,716
|
|
21,284
|
|
20,592
|
Selling, general and
administrative expenses
|
|
4,676
|
|
2,627
|
|
13,690
|
|
12,316
|
|
10,606
|
|
|
10,958
|
|
7,972
|
|
37,406
|
|
33,651
|
|
31,789
|
Loss from
operations
|
|
(10,947)
|
|
(7,972)
|
|
(37,395)
|
|
(27,476)
|
|
(29,736)
|
Finance
income
|
|
15,053
|
|
65
|
|
20,319
|
|
1,748
|
|
6,974
|
Finance
costs
|
|
—
|
|
(2,689)
|
|
—
|
|
(1,512)
|
|
(382)
|
Net finance income
(costs)
|
|
15,053
|
|
(2,624)
|
|
20,319
|
|
236
|
|
6,592
|
Income (loss) before
income taxes
|
|
4,106
|
|
(10,596)
|
|
(17,076)
|
|
(27,240)
|
|
(23,144)
|
Income tax
expense
|
|
(111)
|
|
—
|
|
(111)
|
|
—
|
|
—
|
Net income (loss)
from continuing operations
|
|
3,995
|
|
(10,596)
|
|
(17,187)
|
|
(27,240)
|
|
(23,144)
|
Net income from
discontinued operations
|
|
158
|
|
2,353
|
|
623
|
|
34,055
|
|
2,732
|
Net income
(loss)
|
|
4,153
|
|
(8,243)
|
|
(16,564)
|
|
6,815
|
|
(20,412)
|
Other
comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
Items that may be
reclassified subsequently to profit or loss:
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
(677)
|
|
424
|
|
(1,158)
|
|
1,073
|
|
(504)
|
Items that will not
be reclassified to profit or loss:
|
|
|
|
|
|
|
|
|
|
|
|
Actuarial gain (loss)
on defined benefit plans
|
|
1,336
|
|
2,346
|
|
(1,833)
|
|
2,346
|
|
(3,705)
|
Comprehensive
income (loss)
|
|
4,812
|
|
(5,473)
|
|
(19,555)
|
|
10,234
|
|
(24,621)
|
Net income (loss)
per share (basic and diluted) from continuing
operations
|
|
0.06
|
|
(0.28)
|
|
(0.29)
|
|
(0.92)
|
|
(1.17)
|
Net income (basic
and diluted) from discontinued operations
|
|
—
|
|
0.06
|
|
0.01
|
|
1.16
|
|
0.14
|
Net income (loss)
(basic and diluted) per share
|
|
0.06
|
|
(0.22)
|
|
(0.28)
|
|
0.24
|
|
(1.03)
|
Weighted average
number of shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
65,383,290
|
|
37,274,129
|
|
59,024,730
|
|
29,476,455
|
|
19,775,073
|
Diluted
|
|
65,383,290
|
|
37,274,129
|
|
59,024,730
|
|
29,476,455
|
|
19,806,687
|
Consolidated
Statement of Financial Position Information
|
|
|
|
|
|
As at December
31,
|
(in
thousands)
|
|
2014
|
|
2013
|
|
|
$
|
|
$
|
Cash and cash
equivalents1
|
|
34,931
|
|
43,202
|
Trade and other
receivables and other current assets
|
|
1,286
|
|
2,453
|
Restricted cash
equivalents
|
|
760
|
|
865
|
Property, plant and
equipment
|
|
797
|
|
1,351
|
Other non-current
assets
|
|
9,661
|
|
11,325
|
Total
assets
|
|
47,435
|
|
59,196
|
Payables and other
current liabilities2
|
|
7,304
|
|
7,242
|
Current portion of
deferred revenues
|
|
270
|
|
—
|
Warrant
liability
|
|
8,225
|
|
18,010
|
Non-financial
non-current liabilities3
|
|
17,152
|
|
16,880
|
Total
liabilities
|
|
32,951
|
|
42,132
|
Shareholders'
equity
|
|
14,484
|
|
17,064
|
Total liabilities
and shareholders' equity
|
|
47,435
|
|
59,196
|
_________________________
|
1
|
Of which
approximately $3.6 million was denominated in EUR as at December
31, 2014.
|
2
|
Of which
approximately $1.5 million is related to a provision for
restructuring costs.
|
3
|
Comprised mainly of
employee future benefits, provisions for onerous contracts and
non-current portion of deferred revenues.
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SOURCE Aeterna Zentaris Inc.