Biota Pharmaceuticals, Inc. (NASDAQ: BOTA)
- LANI Influenza Program Advancing Toward Phase
2 Clinical Development
- Merger between Nabi Biopharmaceuticals and
Biota Holdings Limited Successfully Completed
Biota Pharmaceuticals, Inc. (NASDAQ: BOTA) today announced its
financial results for the three month period ended December 31,
2012 and recent corporate developments. The Company's fiscal year
end is June 30.
"We are pleased with the progress of the LANI program such that
we anticipate initiating a large, global Phase 2 clinical trial in
patients with influenza in mid-2013," stated Russell H. Plumb,
President and CEO of Biota Pharmaceuticals, Inc. "With the merger
behind us and our balance sheet strengthened with the related net
cash proceeds, we are now focused on integrating operations and
completing an in-depth strategic, operational and financial review
of our development programs, which we expect to complete by the end
of this quarter."
Recent Corporate Developments
Merger between Nabi Biopharmaceuticals and Biota Holdings
Limited - On November 8, 2012, the Company announced the completion
of the merger between Nabi and Biota Holdings Limited, resulting in
the formation of Biota Pharmaceuticals, Inc. Former Biota Holdings
Limited shareholders retained approximately 83% of the Company's
shares of common stock, while former Nabi shareholders retained
approximately 17% as consideration for Nabi's net assets, which
consisted primarily of $27 million in net cash on the date of the
merger. The merger has been accounted for as a reverse merger, such
that Biota Holdings Limited is considered the accounting acquirer
for financial reporting purposes even though Nabi was the legal
acquirer.
Reverse Stock Split - Concurrent with the completion of the
merger, a reverse stock split of Nabi common stock occurred,
resulting in each six shares of Nabi common stock issued and
outstanding immediately prior to the reverse split being
automatically combined into one share of Nabi common stock. As a
result of the reverse split, the per share exercise price of, and
the number of shares of common stock underlying all stock options
outstanding immediately prior to the reverse split were
automatically proportionally adjusted based on the 1:6 ratio in
accordance with the terms of such options.
Laninamivir Octanoate (LANI) - Laninamivir octanoate is marketed
in Japan by Daiichi Sankyo as Inavir® for the treatment of
influenza A and B in adults and children. In November 2012, Daiichi
Sankyo submitted an application for a label change in Japan to
manufacture and market the influenza antiviral product Inavir® for
the prevention of influenza A and B.
Under the contract the Company has with the U.S. Office of
Biomedical Advanced Research and Development Authority ("BARDA"),
in January 2013 the Company initiated a Phase 1 clinical trial
designed to assess the pharmacokinetics and metabolite profile of
laninamivir octanoate following an inhaled dose administered via
TwinCaps®. This study is a single center, single dose, open-label
study in six healthy male subjects. The Company anticipates that
top-line results from this study will be available in mid-2013.
Further, the Company anticipates initiating a 636-patient,
randomized, placebo-controlled Phase 2 clinical trial of
laninamivir octanoate in mid-2013. The primary objective of the
study is to evaluate the safety and efficacy of two doses of
inhaled laninamivir octanoate (40 and 80 mg) delivered via
TwinCaps® in adults with symptomatic presumptive influenza A or B
infection. The primary endpoint for this study is time to
alleviation of influenza symptoms and fever for ≥ 24 hours.
Executive Management Changes - In connection with the merger, on
November 14, 2012, the Company announced the appointment of Russell
H. Plumb as its President and Chief Executive Officer, as well as a
director, and Joseph M. Patti, M.S.P.H., Ph.D. as its Executive
Vice President, Corporate Development & Strategy. Peter Cook,
who resigned as the Chief Executive Officer of Biota Holdings
Limited upon the completion of the merger, continues to serve as a
director.
Mr. Plumb previously served as President, Chief Executive
Officer and Chief Financial Officer of Inhibitex, Inc., a
publicly-traded clinical-stage drug development company, from
December 2006 through February 2012, when it was acquired. From
2000 to December 2006, Mr. Plumb was the Chief Financial Officer of
Inhibitex.
Dr. Patti was a co-founder of Inhibitex, and served as its Chief
Scientific Officer and Senior Vice President of Research and
Development from 2007 through February 2012. Prior to that, he
served as the Vice President, Research and Development and Chief
Scientific Officer from 2005 to 2007 and Vice President of
Preclinical Development from 1998 to 2005.
Financial Results for the Three Month Period
Ended December 31, 2012
As of December 31, 2012, the Company held $74.1 million in cash
and cash equivalents.
The Company reported net income in the three month period ended
December 31, 2012 of $4.8 million, as compared to a net loss of
$7.0 million in the second quarter of 2011. The $11.8 million
change from net loss in 2011 to net income in 2012 was primarily
the result of an $8.2 million increase in revenue, the recording of
a $7.8 million gain related to the merger, and the receipt of a
$4.4 million research and development credit, offset in part by a
$7.7 million increase in total operating expenses, a $0.4 million
decrease in interest income and a $0.5 million decrease in income
tax benefits. Basic and diluted net income per share were $0.17 for
the three month period ended December 31, 2012, as compared to a
net basic and diluted loss per share of $0.31 in the same period of
2011.
Revenue increased to $10.4 million for the three months ended
December 31, 2012 from $2.1 million in the same period of 2011,
primarily as a result of increased service revenue in 2012 due
principally to the advancement of the laninamivir octanoate program
under the BARDA contract and higher royalty revenue.
Cost of revenue increased to $7.1 million in the three months
ended December 31, 2012 from $2.9 million in the same three month
period in 2011 due principally to the advancement of the
laninamivir octanoate program under the BARDA contract.
Research and development expense decreased to $4.0 million in
the second quarter of 2012 from $5.7 million in the second quarter
of 2011, due largely to the completion of the vapendavir Phase 2
clinical trial during the quarter ended June 30, 2012, as well as
lower preclinical costs associated with our antibacterial and
hepatitis C virus programs and lower personnel-related and other
indirect costs in general.
General and administrative expense increase to $7.1 million in
the second quarter of 2012 as compared to $1.9 million in the
second quarter of 2011 primarily due to merger-related costs of
$3.3 million in 2012, an increase in salaries, benefits,
stock-based compensation and recruiting costs related to the
addition of executive and administrative staff in the U.S., as well
as generally higher insurance, rent, and maintenance costs.
About Influenza and Laninamivir
Octanoate
Influenza is a contagious and potentially fatal disease caused
by a virus which infects the respiratory tract. Influenza viruses
replicate in the cells lining the airways of the lungs and are
generally spread directly to and from the respiratory tract by
coughing and sneezing. Influenza can seriously affect anyone, but
the people at highest risk of severe disease include young
children, adults older than 65, and people of any age with
underlying medical conditions, such as chronic heart, lung, kidney,
liver, blood or metabolic diseases (for example, diabetes), or
weakened immune systems.
Influenza spreads rapidly around the world in seasonal epidemics
affecting between 5-15% of the population each year. According to
the Centers for Disease Control and Prevention, in the U.S. alone,
more than 200,000 people are hospitalized on average every year
with influenza complications, and about 36,000 people die due to
the disease. The World Health Organization estimates that annual
epidemics around the world cause between three and five million
cases of severe influenza, resulting in between 250,000 and 500,000
deaths every year.
The Company has developed first and second generation
neuraminidase inhibitors, the first of which is zanamivir, which is
marketed as Relenza® by GlaxoSmithKline. The Company's second
generation neuraminidase inhibitors are referred to as long-acting
neuraminidase inhibitors (LANIs) and are being evaluated as a
once-weekly or once-only inhaled dose as compared to five day,
twice-daily dosing needed with first generation neuraminidase
inhibitors. The Company and Daiichi Sankyo co-own the rights for
the development and commercialization of LANIs. The lead LANI,
known as laninamivir octanoate, has completed clinical development
in Japan and is marketed by Daiichi Sankyo as Inavir®.
In 2011, the Company announced it had been awarded a contract
from BARDA for up to $231 million designed to support the clinical
development and U.S. based manufacturing for laninamivir octanoate
for the treatment of influenza A and B infections.
About Human Rhinovirus and Vapendavir
Human rhinoviruses (HRV) are a member of a large family of small
viruses known as picornaviruses which are responsible for human
diseases ranging from mild respiratory tract infections (the common
cold) to paralytic poliomyelitis. HRV are the most commonly
isolated viruses from people with mild upper respiratory tract
illness. HRV can be a much more serious problem for some segments
of the population such as infants and the frail elderly. HRV is a
major cause of hospitalization for patients with underlying
respiratory conditions, such as asthma, chronic obstructive
pulmonary disease (COPD) and cystic fibrosis, where HRV can
aggravate their existing disease. Estimates suggest that HRV is
linked to about 70% of all asthma exacerbations and more than 50%
of the hospitalized cases. Studies also suggest that more than 35%
of acute COPD patients requiring hospitalization are associated
with respiratory viruses, including rhinovirus.
The Company is developing vapendavir, a potent oral broad
spectrum inhibitor of HRVs for the treatment of human rhinovirus
infections and the reduction of exacerbations in patients with
moderate to severe asthma or COPD. Vapendavir binds to the capsid
of the HRVs and effectively stops the infection by interfering with
the early steps in the infectious cycle. In March 2012, the Company
announced that it had successfully completed a Phase 2b study in
asthmatics with naturally acquired HRV infection.
About Biota
Biota Pharmaceuticals, Inc. is a biopharmaceutical company
focused on the discovery and development of innovative
anti-infective products to prevent and treat a number of serious
and potentially life-threatening viral and bacterial infectious
diseases. The Company currently has two Phase 2 clinical-stage
development programs, laninamivir octanoate and vapendavir, and
also has preclinical programs focused on developing treatments for
respiratory syncytial virus (RSV) infections, hepatitis C virus
(HCV), gram-positive and gram-negative bacterial infections. For
additional information about the Company, please visit
www.biotapharma.com.
Safe Harbor Statement This press release
contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 that involve known
and unknown risks and uncertainties. All statements, other than
historical facts, including statements regarding: the timing of
commencement and/or completion of the Company's clinical trials;
the planned design, size and timing of when the Company anticipates
initiating a 636-patient, placebo-controlled Phase 2 clinical trial
of laninamivir octanoate; and the anticipated time to complete
management's ongoing strategic, operational and financial review,
are forward looking statements. Various important factors could
cause actual results, performance, events or achievements to
materially differ from those expressed or implied by the
forward-looking statements, including: BARDA not terminating or
significantly amending the Company's existing contract to develop
laninamivir octanoate for the U.S.; the Company, BARDA, the FDA, a
data safety monitoring board, or an institutional review board,
delaying, limiting, suspending or terminating the clinical
development of laninamivir octanoate at any time for a lack of
safety, tolerability, anti-viral activity, commercial viability,
regulatory or manufacturing issues, or any other reason whatsoever;
the Company's ability to comply with extensive government
regulations in various countries and regions in which it expects to
conduct clinical trials; the Company's ability to secure, manage
and retain qualified third-party clinical research, preclinical
research, data management and contract manufacturing organizations
who it relies on to assist in the design, development and
implementation of the clinical development of its product
candidates, including laninamivir octanoate; and other cautionary
statements contained elsewhere in this press release and in the
Company's Quarterly Report on Form 10-Q for the quarter ended
December 31, 2012, as filed with the Securities and Exchange
Commission, or SEC, on February 11, 2013.
There may be events in the future that the Company is unable to
predict, or over which it has no control, and the Company's
business, financial condition, results of operations and prospects
may change in the future. The Company may not update these
forward-looking statements more frequently than quarterly unless it
has an obligation under U.S. Federal securities laws to do so.
Biota is a registered trademark of Biota Holdings Limited.
Relenza™ is a trademark of GlaxoSmithKline plc, Inavir® is a
registered trademark of Daiichi Sankyo Company, Ltd, and TwinCaps®
is a registered trademark of Hovione FarmaCiencia SA.
BIOTA PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except per share amounts)
December 31,2012 June 30,2012
---------------- ----------------
ASSETS
Current assets
Cash and cash equivalents $ 74,111 $ 53,790
Accounts receivable 11,383 5,966
Prepaid and other current assets 2,495 1,374
---------------- ----------------
Total current assets 87,989 61,130
Non-current assets:
Property and equipment, net 4,454 4,944
Intangible assets, net 1,312 1,804
Deferred tax assets 2,427 1,419
---------------- ----------------
Total non-current assets 8,193 8,167
---------------- ----------------
Total assets $ 96,182 $ 69,297
================ ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,466 $ 2,851
Accrued expenses 5,649 6,133
Accrued severance obligations 4,423 -
Deferred revenue 881 398
Deferred tax liabilities 1,526 130
---------------- ----------------
Total current liabilities 16,945 9,512
Non-current liabilities:
Other liabilities, net of current
portion 275 504
---------------- ----------------
Total non-current liabilities 275 504
Total liabilities 17,220 10,016
Stockholders' equity:
Common stock, $0.10 par value;
200,000,000 shares authorized
34,219,690 shares issued and
182,350,316 shares outstanding at
December 31, 2012 and June 30, 2012,
respectively 3,422 100,394
Additional paid-in capital 234,384 668
Treasury stock, 5,867,361 and
1,816,178 at cost, at December 31,
2012 and June 30, 2012, respectively (117,048) (1,397)
Accumulated other comprehensive income 30,517 29,516
Accumulated deficit (72,313) (69,900)
---------------- ----------------
Total stockholders' equity 78,962 59,281
---------------- ----------------
Total liabilities and stockholders'
equity $ 96,182 $ 69,297
================ ================
BIOTA PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except per share amounts)
Three Months Ended Six Months Ended
December 31, December 31,
------------------------ ------------------------
2012 2011 2012 2011
----------- ----------- ----------- -----------
Revenue:
Royalty revenue and
milestones $ 1,943 $ (1,047) $ 1,927 $ 1,460
Revenue from services 8,208 3,121 9,681 4,732
Other 235 19 242 47
----------- ----------- ----------- -----------
Total revenue 10,386 2,093 11,850 6,239
Operating expense: `
Cost of revenue 7,088 2,929 8,637 4,260
Research and
development 4,046 5,727 8,647 12,056
General and
administrative 7,077 1,853 10,268 3,651
----------- ----------- ----------- -----------
Total operating expense 18,211 10,509 27,552 19,967
----------- ----------- ----------- -----------
Loss from operations (7,825) (8,416) (15,702) (13,728)
Non-operating income:
Gain recorded on
merger 7,805 - 7,805 -
Research and
development credit 4,428 - 4,428 -
Interest income 415 841 952 1,826
----------- ----------- ----------- -----------
Income (loss) before tax 4,823 (7,575) (2,517) (11,902)
Income tax benefit 6 520 104 650
----------- ----------- ----------- -----------
Net income (loss) $ 4,829 $ (7,055) $ (2,413) $ (11,252)
=========== =========== =========== ===========
Basic income (loss) per
share $ 0.17 $ (0.31) $ (0.09) $ (0.50)
Diluted income (loss)
per share $ 0.17 $ (0.31) $ (0.09) $ (0.50)
Basic weighted-average
shares outstanding 28,137,346 22,695,081 28,137,346 22,695,081
Diluted weighted-average
shares outstanding 28,352,329 22,695,081 28,137,346 22,695,081
Contacts: Russell H. Plumb President and Chief Executive Officer
(678) 762-3240 r.plumb@biotapharma.com Hershel Berry Blueprint Life
Science Group (415) 375-3340 Ext. 102 hberry@bplifescience.com
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