Galectin Therapeutics Inc. (NASDAQ: GALT), the leading developer of
therapeutics that target galectin proteins, today reported
financial results and provided a business update for the three
months ended March 31, 2019. These results are included in the
Company's Quarterly Report on Form 10-Q, which has been filed with
the U.S. Securities and Exchange Commission and is
available at
www.sec.gov.
Harold H. Shlevin, Ph.D., President and Chief
Executive Officer of Galectin Therapeutics, said, “The past
quarter we continued to prepare for a Phase 3 clinical trial
program with our proprietary compound, belapectin (formerly known
as GR-MD-02), the first drug to show positive results in a clinical
trial in patients with compensated NASH cirrhosis without
esophageal varices. We further announced our Rights Offering as the
means chosen to raise equity capital in a cost-effective manner,
which also provides all of our existing stockholders the
opportunity to participate. We intend to use the net proceeds from
this offering for general working capital purposes and for a
portion of the cost of our NASH-RX Phase 3 clinical trial
evaluating the efficacy of our drug candidate belapectin for the
treatment of NASH cirrhosis patients without esophageal
varices.
“We are making progress with our preparations for
the Phase 3 trial. A Clinical Research Organization (CRO) to run
the clinical trial has been selected and engaged, and we are also
in the latter stages of a process that would enlarge and strengthen
our management team. Beyond our NASH trial, there have been
encouraging developments in other paths forward for belapectin, as
illustrated by a presentation made at the Keystone Symposia on
Molecular and Cellular Biology, where Dr. Sturgill, a researcher at
Providence Portland Medical Center, discussed the effects
belapectin had when combined with various T-cell targeting
immunotherapies, including both aOX40 and Pembrolizumab
(KEYTRUDA®). The trial involving belapectin and KEYTRUDA at
Providence Portland reported a favorable Objective Response Rate
(ORR) in the first 3 cohorts.” Richard E. Uihlein, Chairman of the
Board, added, “I was originally drawn to Galectin Therapeutics as
an investor for its goal to save and change lives, as well as its
potential return. Now that we prepare to commence our NASH-RX Phase
3 clinical trial, under my board leadership we are changing our
lead strategy for equity raises. As the critical first step in the
financial plan to fund the trial, we have commenced our Rights
Offering through which we will turn first to our stockholder base
for additional funding. This will give all of our stockholders,
large and small, the ability to maintain their pro-rata ownership
or increase their ownership percentage if they so choose to
oversubscribe, and I invite my co-investors to invest along side of
me.
“My intention is to personally subscribe $20
million dollars in this offering, which alone will be a
significant portion of the total we hope to raise in this round. I
hope this Rights Offering will be viewed as equitable and fair by
our stockholder base, many of whom have been invested in our
company for many years, and by others who invest with us in the
future.”
Summary of Key Development Programs and
Updates
- Filed a Registration Statement on Form S-3 with the U.S.
Securities and Exchange Commission (SEC) with regards to a planned
Rights Offering of common stock and warrants to its stockholders
and certain warrant holders. The offering states that the company
seeks to raise $50 million to $70 million. The Registration
Statement is now effective, and the Rights Offering has
commenced.
- Released an open letter to stockholders written by Richard E.
Uihlein, Board Chair. In the letter, Mr. Uihlein states that he
intends to personally subscribe $20 million in the Company’s Rights
Offering.
- The official nonproprietary, generic name for GR-MD-02 is now
belapectin. The United States Adopted Names (USAN) Council is
responsible for selecting simple, informative and unique
nonproprietary (generic) drug names. Recently the USAN
assigned the name belapectin to GR-MD-02.
Scientific Presentations and
Conferences
- Dr. Elizabeth Sturgill of Providence Cancer Institute presented
findings on belapectin at the 2019 Keystone Symposia on Molecular
and Cellular Biology, March 25 in Keystone, Colorado. In the oral
presentation titled “Galectin-3 Inhibition with GR-MD-02 Synergizes
with T Cell-Targeting Immunotherapy, Leading to Reduced Immune
Suppression and Improved Overall Survival,” Dr. Sturgill discussed
the effects belapectin had when combined with various T-cell
targeting immunotherapies, including both aOX40 and Pembrolizumab
(KEYTRUDA). Dr. Sturgill also gave a poster presentation titled
“Galectin-3 inhibition with belapectin synergizes with agonist
anti-OX40 mAb therapy leading to reduced immune suppression and
improved overall survival.”
- Dr. Elizabeth Sturgill’s talk described how combination
therapies with belapectin have been shown to improve the survival
rate of tumor-bearing mice, reducing the percentage of suppressive
myeloid cells (MDSC) as well as diminishing the cells’ suppressive
capabilities. Belapectin acts as an inhibitor of galectin-3, a
molecule found in many tumors and associated with poor prognosis
because it depresses immune response to the tumor. Under the
direction of Brendan D. Curti, M.D., Member and Director,
Providence Melanoma Program and Cytokine and Adoptive Immunotherapy
Program, Phase 1 human trials at Providence Cancer
Institute using KEYTRUDA in combination with belapectin have
borne out the preclinical results, with patients in the trial
showing stronger responses than expected with KEYTRUDA alone.
Recent analysis confirms the preliminary findings and suggests that
reduced M-MDSCs may serve as a potential biomarker for response to
treatment.
- Dr. Harold Shlevin presented at the H.C. Wainwright Global Life
Sciences Conference, held at the Grosvenor House in London on April
9.
- Dr. Harold Shlevin participated in the Roth Capital Partners
Battle of the NASH Thrones Investor Conference, held on March 28 in
New York City.
Dr. Shlevin concluded, “We are very excited to be
embarking on a Phase 3 program using belapectin in treatment of
compensated NASH cirrhotic patients. We look forward to the
continued support of our stockholders in this undertaking. In
particular, Mr. Uihlein has been a staunch supporter of the Company
and his efforts have been instrumental in helping us advance our
development programs targeted to assisting patients with NASH
cirrhosis.” Financial Results
For the three months ended March 31, 2019, the
Company reported a net loss applicable to common stockholders of
$9.1 million, or $0.20 per share, compared to a net loss applicable
to common stockholders of $4.5 million, or $0.12 per share, for the
three months ended March 31, 2018. The increase was caused by a
one-time, non-cash $6.6 million charge related to extending the
life of warrants held by the holder of the Company’s Series B
preferred stock in connection with the conversion of all the Series
B preferred stock into common stock. Results also reflect lower
preclinical, clinical and non-cash stock-based compensation
expenses in the current period compared to the year ago period.
Research and development expense for the three months
ended March 31, 2019, was $0.6 million compared with $2.3
million for the three months ended March 31, 2018. The decrease
primarily relates to a reduction in costs for the NASH-CX Phase 2
clinical trial as it wound down, and lower preclinical costs.
General and administrative expense for the three months
ended March 31, 2019, were $1.7 million, compared to $1.9
million for the three months ended March 31, 2018, primarily due to
a decrease in non-cash stock-based compensation expenses somewhat
offset by higher legal costs. As of March 31, 2019, the
Company had $7.0 million of cash and cash equivalents.
The Company also has a $10 million unsecured line of credit, under
which no borrowings have been made to date. The Company believes it
has sufficient cash, including availability under the line of
credit, to fund currently planned operations and research and
development activities through at least March 31, 2020. The
currently planned operations do not include costs related to a
planned Phase 3 clinical trial. While the costs of the trial
and general overhead during the Phase 3 trial are expected to be
approximately $100 million, the costs and timing of such trial are
not yet finalized. The Company has not made commitments for such
trial that cannot be covered with available cash.
About Galectin Therapeutics
Galectin Therapeutics is dedicated to developing novel
therapies to improve the lives of patients with chronic liver
disease and cancer. Galectin’s lead drug belapectin (formerly known
as GR-MD-02) is a carbohydrate-based drug that inhibits the
galectin-3 protein which is directly involved in multiple
inflammatory, fibrotic, and malignant diseases for which it has
Fast Track designation by the U.S. Food and Drug Administration.
The lead development program is in non-alcoholic steatohepatitis
(NASH) with cirrhosis, the most advanced form of NASH-related
fibrosis. This is the most common liver disease and one of the
largest drug development opportunities available today. Additional
development programs are in treatment of severe atopic dermatitis,
moderate-to-severe plaque psoriasis, and in combination
immunotherapy for advanced melanoma and other malignancies;
advancement of these additional clinical programs is largely
dependent on finding a suitable partner. Galectin seeks to leverage
extensive scientific and development expertise as well as
established relationships with external sources to achieve
cost-effective and efficient development. Additional information is
available
at www.galectintherapeutics.com.
Forward Looking StatementsThis
press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These statements relate to future events or future financial
performance, and use words such as “may,” “estimate,” “could,”
“expect” and others. They are based on management’s current
expectations and are subject to factors and uncertainties that
could cause actual results to differ materially from those
described in the statements. These statements include those
regarding the hope that Galectin’s development program for
belapectin will lead to the first therapy for the treatment of
fatty liver disease with cirrhosis and those regarding the hope
that our lead compounds will be successful in the treatment of
severe atopic dermatitis, moderate-to-severe plaque psoriasis and
in cancer immunotherapy and in other therapeutic indications.
Factors that could cause actual performance to differ materially
from those discussed in the forward-looking statements include,
among others, that Galectin may not be successful in developing
effective treatments and/or obtaining the requisite approvals for
the use of belapectin or any of its other drugs in development; the
Company may not be successful in scaling up manufacturing and
meeting requirements related to chemistry, manufacturing and
control matters; the Company’s currently planned clinical trial and
any future clinical studies may not produce positive results in a
timely fashion, if at all, and could prove time consuming and
costly; plans regarding development, approval and marketing of any
of Galectin’s drugs are subject to change at any time based on the
changing needs of the Company as determined by management and
regulatory agencies; regardless of the results of any of its
development programs, Galectin may be unsuccessful in developing
partnerships with other companies or raising additional capital,
including in its Rights Offering, that would allow it to further
develop and/or fund any studies or trials. Galectin has
incurred operating losses since inception, and its ability to
successfully develop and market drugs may be impacted by its
ability to manage costs and finance continuing operations. For a
discussion of additional factors impacting Galectin’s business, see
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2018, and subsequent filings with the SEC. You should
not place undue reliance on forward-looking statements. Although
subsequent events may cause its views to change, management
disclaims any obligation to update forward-looking statements.
Contact:Jack Callicutt, Chief Financial
Officer(678) 620-3186ir@galectintherapeutics.com.
Galectin Therapeutics and its associated logo is
a registered trademark of Galectin Therapeutics Inc.
Condensed Consolidated Statements of
Operations
|
Three Months EndedMarch 31, |
|
2019 |
|
2018 |
|
|
(in thousands, except per share data) |
Operating expenses: |
|
|
Research and development |
$ 646 |
|
$ 2,298 |
|
General and administrative |
1,721 |
|
1,880 |
|
Total operating expenses |
2,367 |
|
4,178 |
|
Total operating loss |
(2,367) |
|
(4,178) |
|
|
|
|
Other income (expense): |
|
|
Interest and other |
(8) |
|
(80) |
|
Total other income |
(8) |
|
(80) |
|
Net loss |
(2,375) |
|
(4,258) |
|
Preferred stock dividends |
(96) |
|
(285) |
|
Non-cash charge related to warrant modification |
(6,622) |
|
-- |
|
Net loss applicable to common stock |
$ (9,093) |
|
$ (4,543) |
|
Basic and diluted net loss per share |
$ (0.20) |
|
$ (0.12) |
|
Shares used in computing basic and diluted net loss per share |
44,975 |
|
37,284 |
|
|
|
|
|
|
Condensed Consolidated Balance Sheet
Data
|
|
March 31, 2019 |
|
|
December 31, 2018 |
|
|
|
(in thousands) |
|
Cash and cash equivalents |
$ |
6,972 |
|
$ |
8,253 |
|
Total assets |
|
7,830 |
|
|
9,006 |
|
Total current liabilities |
|
907 |
|
|
2,108 |
|
Total liabilities |
|
988 |
|
|
2,108 |
|
Total redeemable, convertible preferred stock |
|
1,723 |
|
|
1,723 |
|
Total stockholders’ equity |
$ |
5,119 |
|
$ |
5,175 |
|
|
|
|
|
|
|
|
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