Clinical phase of Zoptrex™ and
Macrilen™ development programs completed;
Zoptrex™ top-line results expected in April
All amounts are in US Dollars
Recent key developments
- Development programs progressing
toward completion
- Zoptrex™ (zoptarelin doxorubicin)
pivotal Phase 3 trial clinically completed on January 30, 2017;
pre-NDA meeting with FDA held on January 31, 2017; top-line results
expected to be reported in April 2017
- Company believes that analysis of data
from confirmatory Phase 3 trial of Macrilen™ (macimorelin) is
supportive of registration consideration; Meeting with FDA will be
held at the end of Q1
- Financial condition and capital
structure improved
- $22.0 million unrestricted cash and
cash equivalents at year-end; no third-party debt
- Approximately $7.6 million of gross
proceeds raised from a successful registered direct offering of
Units concluded on November 1, 2016
- Approximately $4.7 million of gross
proceeds raised from sales of Common Shares pursuant to ATM program
during and subsequent to the fourth quarter
- Approximately 13.5 million Common
Shares outstanding as of March 15, 2017
Aeterna Zentaris Inc. (NASDAQ: AEZS) (TSX: AEZS) (the
“Company”), a specialty biopharmaceutical company engaged in
developing and commercializing novel treatments in oncology and
endocrinology, today reported financial and operating results for
the fourth quarter and year ended December 31, 2016.
Commenting on recent key developments, David A. Dodd, President
and Chief Executive Officer of the Company, stated, “During the
fourth quarter and the first few weeks of 2017, we made substantial
progress with our development programs. On January 30, 2017, we
announced the conclusion of the clinical phase of our development
of Zoptrex™. The following day we had a successful pre-NDA meeting
with the FDA. We anticipate reporting top-line results in April.
This is a very exciting and anxious time for us, as we approach the
culmination of highly dedicated and successful work by many
throughout our Company. I would like to thank our R&D team for
their hard work in bringing Zoptrex™ to this point.”
Mr. Dodd continued his commentary with an update on the
development of Macrilen™. “On January 4, 2017, we reported the
top-line results from our confirmatory Phase 3 study of Macrilen™
for the evaluation of adult growth hormone deficiency ("AGHD"). We
reported that the top-line results indicated that macimorelin did
not meet one of the pre-defined criteria required to demonstrate
equivalence to the Insulin Tolerance Test ("ITT") as a means of
diagnosing AGHD. Following this announcement, we conducted a
thorough evaluation of the study data, including external
statistical expertise and independent review by leading
endocrinologists in both the U.S. and Europe. We were highly
encouraged by the results and input received from these experts. As
we announced on February 13, 2017, we concluded that Macrilen™
demonstrated performance supportive of achieving registration with
the U.S. Food and Drug Administration, despite its failure to meet
one of the pre-defined equivalence criteria. We explained the
reasons for our conclusion in our February 13 release. Briefly, we
concluded that Macrilen™ demonstrated more consistent and
reproducible results than the ITT. Moreover, Macrilen™ stimulated
the pituitary gland more powerfully than the ITT and demonstrated
good specificity and sensitivity in this study, thus reproducing
the results of our previous study. We demonstrated that Macrilen™
achieves a high degree of correlation with the ITT, which could be
further optimized when a higher cut-off point, such as the ITT
cut-off point, is used for the Macrilen™ test. We believe that such
an increased cut-off point would be justified by the more powerful
stimulation of Macrilen™ as compared to the ITT. We are scheduled
to meet with the FDA at the end of Q1 to discuss our rationale for
proceeding with Macrilen™.”
Fourth Quarter and Full Year Financial Highlights
Revenues
Sales commission and other were $94,000 and $414,000 for the
three and twelve months ended December 31, 2016, respectively, and
$41,000 and $297,000, for the same periods in 2015, respectively.
The quarter-over-quarter and year-over-year increases were
attributable to our sales team exceeding pre-established unit sales
baseline thresholds under our co-promotion agreements to sell
Saizen® and to our promotion of APIFINY®, which did not begin until
the first quarter of 2016. In the corresponding periods of 2015,
sales commission and other revenues were mainly related to
EstroGel®, which we no longer promote.
License fees were $210,000 and $497,000 for the three and twelve
months ended December 31, 2016, respectively, as compared to
$61,000 and $248,000 for the same periods in 2015. The increase is
explained by the out-licensing agreements that we entered into in
2016 for Zoptrex™ with respect to certain territories outside our
core areas of interest.
Research and Development (“R&D”) costs
R&D costs were $4.6 million and $16.5 million for the three
and twelve months ended December 31, 2016, respectively, compared
to $4.2 million and $17.2 million for the same periods in 2015. The
increase in our R&D costs for the three months ended December
31, 2016, as compared to the same period in 2015, was mainly
attributable to higher comparative third-party costs in connection
with the confirmatory Phase 3 clinical trial of Macrilen™, which
was initiated late in 2015 with the enrollment of the first patient
in the fourth quarter of 2015. Patient recruitment was completed in
the fourth quarter of 2016. The decrease in our R&D costs for
the twelve months ended December 31, 2016, as compared to the same
period in 2015, was mainly attributable to the realization of cost
savings in connection with our ongoing efforts to streamline our
R&D activities and to increase our commercial operations and
flexibility by reducing our R&D staff, which was started in
2014.
General and Administrative (“G&A”) Expenses
G&A expenses were $1.8 million and $7.1 million for the
three and twelve months ended December 31, 2016, respectively, as
compared to $4.0 million and $11.3 million for the same periods in
2015. The decrease in our G&A expenses for the three months and
twelve months ended December 31, 2016, as compared to the same
periods in 2015, is mainly due to the recording in the fourth
quarter of 2015 of a provision related to the restructuring of our
finance and accounting function and the closure of our office in
Quebec City, as well as the realization of cost savings in
connection with the restructuring. The comparative decrease for the
twelve-month period is also explained by certain transaction costs
allocated to warrants in connection with the completion of share
issuances in March and December 2015.
Selling Expenses
Selling expenses were $1.5 million and $6.7 million for the
three and twelve months ended December 31, 2016, respectively, as
compared to $1.8 million and $6.9 million for the same periods in
2015. Selling expenses for the three and twelve months ended
December 31, 2016 and 2015 represent mainly the costs of our
contracted sales force related to our co-promotion activities as
well as our internal sales management team. Selling expenses
remained relatively stable during 2016.
Net Finance (Costs) Income
Net finance (costs) income were $(622,000) and $4.5 million for
the three and twelve months ended December 31, 2016, as compared to
$(185,000) and $(15.3) million, for the same periods in 2015. The
increases in finance income or decreases in finance costs were
mainly attributable to the change in fair value recorded in
connection with our warrant liability. Such change in fair value
results from the periodic “mark-to-market” revaluation, via the
application of option pricing models, of outstanding share purchase
warrants. During 2016, the “mark-to-market” warrant valuation was
impacted by the expiration of the remaining Series B Warrants.
During 2015, the change in assumptions that were applied to
determine the fair value of the alternate cashless feature included
in the Series B Warrants significantly impacted the
“mark-to-market” valuation. Furthermore, the closing price of our
common shares, which, on the NASDAQ, fluctuated from $3.25 to $4.94
during the three-month period and $2.67 to $4.94 during the
twelve-month period ended December 31, 2016, respectively, compared
to $4.00 to $11.43 and $4.00 to $84.20 during the same periods in
2015, also had a direct impact on the change in fair value of
warrant liability. In addition, with specific reference to 2015,
finance costs were also impacted by the warrant exercise inducement
fee paid to certain holders of the Series B Warrants.
Net Loss
Net loss for the three and twelve months ended December 31, 2016
was $(8.2) million and $(25.0) million, or $(0.71) and $(2.41) per
basic and diluted share, as compared to a net loss of $(10.0)
million and $(50.1) million, or $(1.46) and $(18.14) per basic and
diluted share, for the same periods in 2015. The decrease in net
loss for the three months ended December 31, 2016, as compared to
the same period in 2015, is due largely to lower G&A expenses,
as presented above. The decrease in net loss for the twelve months
ended December 31, 2016, as compared to the same period in 2015, is
due largely to lower operating expenses and higher comparative net
finance income, as presented above.
Liquidity
Cash and cash equivalents were $22.0 million as at December 31,
2016, as compared to $41.5 million as at December 31, 2015. The
decrease in cash and cash equivalents as at December 31, 2016, as
compared to December 31, 2015, is mainly due to the net cash used
in operating activities. The decrease was partially offset by the
net proceeds generated by the sale and issuance of common shares
and warrants during 2016.
Conference Call & Webcast
The Company will host a conference call and live webcast to
discuss these results on Thursday, March 16, 2017, at 8:30 a.m.,
Eastern Time. Participants may access the live webcast via the
Company's website at www.aezsinc.com or by telephone using the
following dial-in number: 201-689-8029 and Confirmation number
13653427. A replay of the webcast will also be available on the
Company’s website for a period of 30 days.
For reference, the Management’s Discussion and Analysis of
Financial Condition and Results of Operations for the fourth
quarter and full year 2016, as well as the Company’s audited
consolidated financial statements as at December 31, 2016, 2015 and
2014, 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. We are engaged in drug
development activities and in the promotion of products for others.
We recently completed Phase 3 studies of two internally developed
compounds. The focus of our business development efforts is the
acquisition of licenses to products that are relevant to our
therapeutic areas of focus. We also intend to license out certain
commercial rights of internally developed products to licensees in
non-U.S. territories where such out-licensing would enable us to
ensure development, registration and launch of our product
candidates. Our goal is to become a growth-oriented specialty
biopharmaceutical company by pursuing successful development and
commercialization of our product portfolio, achieving successful
commercial presence and growth, while consistently delivering value
to our shareholders, employees and the medical providers and
patients who will benefit from our products. For more information,
visit www.aezsinc.com.
Forward-Looking Statements
This press release contains forward-looking statements made
pursuant to the safe-harbor provision of the U.S. Securities
Litigation Reform Act of 1995, which reflect our current
expectations regarding future events. Forward-looking statements
may include, but are not limited to statements preceded by,
followed by, or that include the words “expects,” “believes,”
“intends,” “anticipates,” and similar terms that relate to future
events, performance, or our results. Forward-looking statements
involve known risks and uncertainties, many of which are discussed
under the caption “Key Information - Risk Factors” in our most
recent Annual Report on Form 20-F filed with the relevant Canadian
securities regulatory authorities in lieu of an annual information
form and with the U.S. Securities and Exchange Commission (“SEC”).
Such statements include, but are not limited to, statements about
the progress of our research, development and clinical trials and
the timing of, and prospects for, regulatory approval and
commercialization of our product candidates, the timing of expected
results of our studies, anticipated results of these studies,
statements about the status of our efforts to establish a
commercial operation and to obtain the right to promote or sell
products that we did not develop and estimates regarding our
capital requirements and our needs for, and our ability to obtain,
additional financing. Known and unknown risks and uncertainties
could cause our actual results to differ materially from those in
forward-looking statements. Such risks and uncertainties include,
among others, the availability of funds and resources to pursue our
research and development projects and clinical trials, 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 rejection or non-acceptance of
any new drug application by one or more regulatory authorities and,
more generally, uncertainties related to the regulatory process
(including whether or not the regulatory authorities will accept
the Company’s conclusions regarding Macrilen™ following its
comprehensive review of the Phase 3 study data described elsewhere
in this press release), the ability of the Company to efficiently
commercialize one or more of its products or product candidates,
the degree of market acceptance once our products are approved for
commercialization, our ability to take advantage of business
opportunities in the pharmaceutical industry, our 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 U.S. securities commissions
for additional information on risks and uncertainties. Given these
uncertainties and risk factors, readers are cautioned not to place
undue reliance on these forward-looking statements. We disclaim any
obligation to update any such factors or to publicly announce 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 applicable law.
Consolidated Statements of
Comprehensive Loss Information
(unaudited)
Three months ended December 31, Years ended
December 31, (in thousands, except share and per share data)
2016 2015 2016
2015 2014 $ $ $
$ $ Revenues Sales commission and other
94 41
414 297 — License fees
210 61
497 248 11
304 102
911 545 11
Operating
expenses Research and development costs
4,619 4,243
16,495 17,234 23,716 General and administrative expenses
1,757 3,953
7,147 11,308 9,840 Selling expenses
1,526 1,764
6,745 6,887
3,850
7,902 9,960
30,387
35,429 37,406
Loss from operations
(7,598 ) (9,858 )
(29,476 ) (34,884 )
(37,395 ) (Loss) gain due to changes in foreign currency exchange
rates
(396 ) (315 )
(70 ) (1,767 )
1,879 Change in fair value of warrant liability
(245
) 3,030
4,437 (10,956 ) 18,272 Warrant exercise
inducement fee
— (2,926 )
— (2,926 ) — Other finance
income
19 26
150 305 168
Net finance (costs) income (622 ) (185
)
4,517 (15,344 ) 20,319 Loss before income
taxes
(8,220 ) (10,043 )
(24,959 )
(50,228 ) (17,076 ) Income tax expense
— —
— — (111 )
Net loss from continuing
operations (8,220 ) (10,043 )
(24,959
) (50,228 ) (17,187 )
Net income from discontinued
operations — 25
— 85
623
Net loss (8,220 ) (10,018 )
(24,959 ) (50,143 ) (16,564 )
Other Comprehensive
Loss: Items that may be reclassified subsequently to profit or
loss: Foreign currency translation adjustments
870 249
569 1,509 (1,158 ) Items that will not be reclassified to
profit or loss: Actuarial gain (loss) on defined benefit plans
1,143 (116 )
(1,479 ) 844 (1,833
)
Comprehensive loss (6,207 ) (9,885 )
(25,869 ) (47,790 ) (19,555 )
Net loss per share
(basic and diluted) from continuing operations (0.71
) (1.46 )
(2.41 ) (18.17 ) (29.12 )
Net
income purchase per share (basic and diluted) from discontinued
operations — —
— 0.03
1.06
Net loss per share (basic and diluted)
(0.71 ) (1.46 )
(2.41 ) (18.14 ) (28.06
)
Weighted average number of shares outstanding: Basic
11,565,210 6,874,460
10,348,879
2,763,603 590,247 Diluted
11,614,234
7,302,816
10,665,149 3,424,336 590,247
Consolidated Statement of Financial
Position Information
(unaudited)
December 31, (in thousands)
2016
2015 $ $ Cash and cash equivalents1
21,999 41,450 Trade and other receivables and other current
assets
744 944 Restricted cash equivalents
496 255
Property, plant and equipment
204 256 Other non-current
assets
8,216 8,593
Total assets 31,659
51,498 Payables and other current liabilities2
3,778
4,770 Current portion of deferred revenues
426 244 Warrant
liability
6,854 10,891 Non-financial non-current
liabilities3
14,389 13,978
Total liabilities
25,447 29,883
Shareholders' equity 6,212
21,615
Total liabilities and shareholders' equity
31,659 51,498 _________________________ 1.
Approximately $1.5 million was denominated in EUR as at December
31, 2016 and December 31, 2015, and approximately $3.7 and $4.4
million were denominated in Canadian dollars as at December 31,
2016 and December 31, 2015, respectively. 2. Approximately $0.6
million was related to our provision for restructuring as at
December 31, 2015. 3. Comprised mainly of employee future benefits,
provisions for onerous contracts and non-current portion of
deferred revenues.
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version on businesswire.com: http://www.businesswire.com/news/home/20170315006476/en/
Aeterna Zentaris Inc.Philip A. Theodore, 843-900-3211Senior Vice
PresidentIR@aezsinc.com
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