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ProMetic Life Sciences Inc
Symbol PLI
Shares Issued 554,183,070
Close 2015-03-31 C$ 2.42
Market Cap C$ 1,341,123,029
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ProMetic earns $2.6-million in 2014

2015-04-01 05:21 ET - News Release

Mr. Pierre Laurin reports

PROMETIC REPORTS ITS 2014 FOURTH QUARTER AND YEAR-END HIGHLIGHTS AND FINANCIAL RESULTS

ProMetic Life Sciences Inc. had revenues of $23.0-million and a net profit of $2.6-million and revenues of $10.5-million and a net profit of $8.5-million for the year and quarter ended Dec. 31, 2014, respectively. This compares with revenues of $20.6-million and a net loss of $17.4-million and revenues of $5.1-million and a net loss of $7.5-million for the year and quarter ended Dec. 31, 2013, respectively.

"The continuation of our transition towards becoming a vertically integrated biopharmaceutical company was greatly facilitated in 2014 by the strengthening of both our market capitalization and overall general financial position. We have continued to increase our investment in the development of more of our own assets by successfully completing two different financings totalling more than $48-million," mentioned Bruce Pritchard, ProMetic's chief operating and chief financial officer. "ProMetic is now well positioned to continue executing on its value creation strategic corporate initiatives."

Commenting on the various milestones achieved in 2014, Pierre Laurin, ProMetic's president and chief executive officer, stated: "All our operational and clinical milestone achievements throughout 2014 have favourably positioned ProMetic to benefit from its rapidly growing and significant product pipeline. With numerous drug candidates progressing through and towards advanced stages of clinical development, ProMetic now possesses all the required elements to become a leader in the field of large unmet medical conditions and rare diseases."

Highlights in 2014

Business highlights

ProMetic continued its transition into a vertically integrated biopharmaceutical corporation with a rapidly growing pipeline of drug candidates targeting underserved patient populations in both existing and emerging markets.

In 2014, ProMetic:

  • Entered into definitive agreements with Generium Pharmaceuticals for several plasma-derived biopharmaceuticals to be manufactured and commercialized in Russia and Commonwealth of Independent States; the alliance includes the granting of manufacturing rights by ProMetic to Generium for several plasma-derived biopharmaceuticals using ProMetic's proprietary PPPS technology to be manufactured in an up-to-600,000-litre-per-year facility to be built and operated by Generium in Russia;
  • Announced the pursuit of a clinical program designed to evaluate the benefits of PBI-4050 in patients affected by the metabolic syndrome and resulting Type 2 diabetes;
  • Entered into an agreement with a syndicate of underwriters under which the underwriters agreed to buy, on a bought-deal basis, 15.2 million common shares in the capital of the corporation, including the overallotment, at a price of $1.90 per share for gross proceeds of $28.8-million;
  • Disclosed new preclinical data on PBI-4050 from studies performed by Vanderbilt University in a very severe model of accelerated Type 2 diabetes, where PBI-4050 attenuated the development of diabetic nephropathies in Type 2 diabetes;
  • Received approval to commence clinical trials for its orally active small-molecule lead compound, PBI-4050, in patients suffering from chronic kidney disease following the CTA clearance by Health Canada;
  • Received clearance by the Food and Drug Administration for its IND application for its intravenous plasminogen for the treatment of Type 1 plasminogen deficiency;
  • Announced the pursuit of idiopathic pulmonary fibrosis as one of its PBI-4050 orphan indications;
  • Announced its addition to the S&P/TSX SmallCap Index;
  • Secured a follow-on investment from Thomvest Seed Capital Inc. consisting of a $20-million loan;
  • Announced the launch of fibrinogen for commercial sales during the fourth quarter of 2014 after its successful scale-up at its Laval-based plasma purification facility;
  • Completed its PBI-4050 phase 1 clinical trial in 40 healthy volunteers where it was found to be safe and very well tolerated without any serious adverse events reported;
  • Received a $5.6-million purchase order from Octapharma relating to the purchase of PrioClear, a proprietary prion capture resin incorporated in Octapharma's manufacturing process for its solvent-/detergent-treated plasma product, OctaplasLG;
  • Increased its ownership in NantPro following the amendment of its related corporate and commercial agreement with NantPharma LLC providing ProMetic with the effective control of NantPro and a greater portion of the future value and revenues associated with the development and sales of IVIG in the U.S. market;
  • Presented new preclinical data at the annual meeting of the 2014 European Association for the Study of the Liver supporting the claim of PBI-4050 anti-fibrotic activity to address various liver conditions;
  • Presented new preclinical data at the 2014 International Society of Nephrology Nexus symposium, demonstrating that PBI-4050 was shown to significantly reduce oxidative stress markers, as well as inflammatory and pro-fibrotic cytokines in animal models designed to emulate chronic kidney disease and diabetic kidney disease;
  • Appointed Dr. John Moran as its new chief medical officer.

Financial results for 2014

This financial information should be read in conjunction with the corporation's consolidated financial statements for the year ended Dec. 31, 2014, as well as management's discussion and analysis dated March 31, 2015.

Total revenues for the fourth quarter of 2014, which were derived from product sales, development services and licensing revenues, were $10.5-million as compared with $5.1-million for the fourth quarter of 2013. Total revenues for the 2014 financial year were $23.0-million as compared with $20.6-million for the previous financial year.

Revenues from the sale of goods and services totalled $15.6-million in 2014 compared with $18.1-million in 2013. The decrease is a result of the NantPro consolidation and the elimination of these service revenues upon consolidation.

Milestone and licensing revenues were $7.4-million in 2014 compared with $2.6-million in 2013, representing an increase of $4.8-million. The increase reflects the upfront payment related to the closing of the alliance with Generium Pharmaceuticals.

ProMetic generated a net profit of $8.5-million for the quarter ended Dec. 31, 2014, and a net profit of $2.6-million for the 2014 financial year compared with a net loss of $7.5-million for the previous 2013 quarter ended Dec. 31, 2013, and a net loss of $17.4-million for the financial year ended Dec. 31, 2014.

The net profits are mainly due to the recognition of a purchase gain on business combination of $14.8-million in regard to the additional 40.83 per cent of equity acquired in NantPro and the recognition of a gain on revaluation of the equity investment of $34.4-million, representing the difference between the fair value and the carrying amount of ProMetic's equity interest in NantPro just before the transaction.

Non-rechargeable research and development expenses were $32.1-million in 2014 compared with $13.7-million in 2013, representing an increase of $18.4-million. The increase mainly comes from a higher level of research activities associated to the PBI-4050 clinical program and the costs associated with the preparation of the Laval plasma purification facility for a GMP validation.

"Our total assets have more than quadrupled on a year-to-year comparison basis following the successful completion of the NantPro transaction and closing of two financings completed in 2014. Our cash capital and intangible assets positions have all significantly increased during 2014 compared with 2013," stated Mr. Pritchard, ProMetic's chief financial officer.

Amendment and restatement of Structured Alpha LP loan agreements

ProMetic and Structured Alpha have entered into amended and restated loan agreements on March 31, 2015, in respect of the loan agreements dated Sept. 10, 2013, and July 31, 2014, entered into between ProMetic, certain of its affiliates and Thomvest Seed Capital Inc., an affiliate of Structured Alpha. The amended and restated loan agreements provide for several amendments in favour of ProMetic, which amongst others include the extension of the maturity date of the loan agreements to July 31, 2022, a right of repayment of the loan agreements commencing on Sept. 13, 2018, and more flexibility in its affirmative and negative covenants. In consideration for these modifications, ProMetic granted Structured Alpha seven million warrants to purchase ProMetic's common shares at an exercise price equal to the greater of: (i) $3 per common share and (ii) the volume-weighted average trading price of the common shares on the Toronto Stock Exchange for the five-trading-day period following the date of release of the annual financial statements of the corporation for the period ended Dec. 31, 2014. The warrants have an expiry date of July 31, 2022. ProMetic also granted Structured Alpha a pre-emptive right to participate in any future public offering or private placement of ProMetic's common shares or securities convertible or exchangeable into common shares of ProMetic.

"We are pleased with Structured Alpha's decision to strengthen its relationship with us by further participating in our share capital. The terms of the amended and restated loan agreements provide us with the necessary flexibility to pursue our growth objectives while we continue to build and advance our product pipeline and diversify our stream of recurring revenues," said Mr. Laurin, president and chief executive officer of ProMetic Life Sciences.

Fourth quarter and year-end 2014 conference call information

ProMetic will host a conference call at 11 a.m. (EST) on April 1, 2015. The telephone numbers to access the conference call are: 647-788-4922 (international) and 1-877-223-4471 (toll-free). A replay of the call will be available from April 1, 2015, at 2 p.m. until April 7, 2015. The numbers to access the replay are 1-416-621-4642 (passcode 14920787) and 1-800-585-8367 (passcode 14920787).

Additional information in respect of the three-month and 12-month periods ended Dec. 31, 2014

ProMetic's management's discussion and analysis and 2014 financial statements will be filed on SEDAR and will be available on the company's website.

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