Dr. Mark Murray reports
TEKMIRA PROVIDES CORPORATE UPDATE AND ANNOUNCES THIRD QUARTER 2014 RESULTS
Tekmira Pharmaceuticals Corp. has released its financial and operating results for the third quarter ended Sept. 30, 2014, and provided a corporate update.
"Our goal this quarter was to continue the advancement of our product development programs, reflecting the company's focus on developing novel RNAi-based therapeutics," said Dr. Mark J. Murray, Tekmira's president and chief executive officer. "It is an important time at Tekmira, and we are pleased with our progress to date as we concentrate on achieving future milestones."
Dr. Murray added: "In response to the extremely unique circumstances surrounding the Ebola virus outbreak, we have designed and initiated production of a modified RNAi therapeutic directed against the Guinea variant of the Ebola virus, which is responsible for the epidemic in West Africa. We are also very pleased that the U.S. Department of Defense exercised the option to manufacture TKM-Ebola-Guinea, valued at $7-million. This shows a commitment to the continued development of anti-Ebola therapeutics."
- For the third quarter ended Sept. 30, 2014, Tekmira had cash, cash equivalents and investments of $120.5-million. The company has 22.3 million common shares issued and outstanding, and 24.6 million shares on a fully diluted basis;
Results from the TKM-HBV program presented this quarter demonstrate potent and rapid reduction in hepatitis B surface antigen (HBsAg) in several well-validated models. The data demonstrate that inclusion of three RNAi triggers results in a more broadly effective knock-down of viral proteins than a single trigger alone. The results were presented on Oct. 15, 2014, at the 10th annual meeting of the Oligonucleotide Therapeutics Society in San Diego, Calif.;
In the TKM-PLK1 phase I/II clinical trial targeting advanced gastrointestinal neuroendocrine tumours (GI-NET) or adrenocortical carcinoma (ACC) tumours, enrolment of patients, with advanced GI-NET or ACC, has been completed. These patients will continue treatment and will be followed to determine if TKM-PLK1 results in meaningful clinical benefit;
- In the phase I/II clinical trial with TKM-PLK1 in patients with hepatocellular carcinoma (HCC), dosing of the first cohort of patients has been completed;
- In September, Tekmira joined an international consortium led by the International Severe Acute Respiratory and Emerging Infections Consortium (ISARIC) at the University of Oxford, with representatives from the World Health Organization (WHO), U.S. Centres for Disease Control (CDC), Medecins sans frontieres (MSF), Institut Pasteur and others, to potentially provide an RNAi-based investigational therapeutic for expedited clinical studies in West Africa. The international consortium was awarded 3.2 million British pounds ($5.1-million) from the Wellcome Trust to fund this initiative;
The design of a modified RNAi therapeutic targeting the Ebola-Guinea virus variant, which is responsible for the current epidemic in West Africa, has been completed. GMP manufacture of the TKM-Ebola-Guinea product has commenced, and supply of this product will be available in early December, 2014, with the objective of using the product for clinical studies in West Africa;
The U.S. Department of Defense joint project manager medical countermeasure systems bio-defence therapeutics (JPM-MCS-BDTX) has exercised an option, in the current contract with Tekmira, to manufacture a modified RNAi therapeutic targeting the Ebola-Guinea variant. Tekmira has been awarded the option for scale-up and GMP manufacture of the product for approximately 500 treatment courses, which is valued at $7-million;
With recent developments such as the production of a new product candidate, TKM-Ebola-Guinea, for clinical trials in infected patients, and the continued emergency use of Tekmira's original TKM-Ebola product under expanded access protocols, the clinical development pathways of the company's Ebola products have evolved. As a result, the company may not resolve the partial clinical hold of the multiple ascending dose portion of the phase I trial of TKM-Ebola in healthy volunteers in 2014;
- Under the U.S. Food and Drug Administration's expanded access program, several patients with a confirmed or suspected Ebola virus infection have been treated with TKM-Ebola. Data are being collected and will be provided to the FDA under the company's investigational new drug application;
In October, Alnylam Pharmaceuticals Inc. released data from its continuing Patisiran (TTR02) phase II open-label extension study in patients with familial amyloidotic polyneuropathy. This program is LNP-enabled and its results further validate Tekmira's proprietary LNP delivery technology. Alnylam's results also demonstrate that multidosing with LNP has been well tolerated with treatments out to one year;
Along with the University of Texas medical branch at Galveston, U.S., the company published non-human primate TKM-Marburg data in the Aug. 20, 2014, edition of the journal Science Translational Medicine;
- The company received an additional $1.5-million payment from Monsanto following completion of specified program developments;
The company announced it will be hosting an analyst day on Nov. 21 at the Le Parker Meridien in New York;
As of Jan. 1, 2015, the company will be deemed to be a domestic issuer for U.S. Securities and Exchange Commission reporting purposes. As a result, Tekmira will be required to comply with SEC disclosure and proxy solicitation rules applicable to domestic issuers.
The net loss for the third quarter of 2014 was $8.6-million (39 cents per common share), as compared with a net loss of $5.9-million (41 cents per common share) for the third quarter of 2013.
Revenue was $4.4-million for third quarter 2014 as compared with $3-million for third quarter 2013.
Under the U.S. Department of Defense contract to develop TKM-Ebola, Tekmira is being reimbursed for costs incurred, including an allocation of overheads, and is being paid an incentive fee. For this contract, Tekmira recorded $1.5-million in revenue in third quarter 2014 as compared with $2.8-million in third quarter 2013. The revenue decline quarter on quarter is due to a decrease in activity as the company nears the end of stage one of the contract.
Tekmira also recorded revenue from Monsanto for research services and the use of the company's technology. As of third quarter 2014, Tekmira is due $1.5-million from Monsanto following the completion of specified program developments. Most of the revenue recorded under this contract are being amortized over the contract period, which was determined to be four years at contract inception. Monsanto revenue in the third quarter was $1-million.
In August, 2014, Tekmira received notification from BMS that the anticipated extension of this collaboration would not occur. As such, the collaboration expired and both parties' obligations under the agreement have ended. Revenue recognized in third quarter 2014 relates to the release of the deferred revenue balance of $1.6-million now that the agreement has expired.
In addition, Tekmira recorded royalty revenue from Spectrum Pharmaceuticals for the commercial sales of Marqibo during third quarter 2014.
Research, development, collaborations and contracts expenses
Research, development, collaborations and contracts expenses were $9.3-million in third quarter 2014 as compared with $5.5-million in third quarter 2013.
TKM-HBV expenses increased as Tekmira prepares to file an IND, or equivalent, in fourth quarter 2014, and TKM-PLK1 expenses increased with the expansion in the number of clinical trial sites and set-up costs for the commencement of the HCC trial. In addition, Tekmira increased research activities related to the collaboration with Monsanto in the agricultural field.
General and administrative
General and administrative expenses were $1.8-million in third quarter 2014 as compared with $1-million in third quarter 2013. The increase in general and administrative expense was due to an increase in compensation expense with the growth in employee base to support an expanded portfolio of product candidates.
In third quarter 2014, Tekmira recorded a foreign exchange gain of $3.1-million related to the appreciation in value of U.S. dollar funds, as compared with a foreign exchange gain of $50,000 in third quarter 2013.
The aggregate increase in value of Tekmira's common share purchase warrants was $5.1-million in third quarter 2014 as compared with an increase in the value of common share purchase warrants outstanding of $2.4-million in third quarter 2013. The increase is a result of an increase in the company's share price from the previous reporting date.
Conference call information
Tekmira will hold a conference call and webcast today (Thursday, Nov. 6, 2014) at 2 p.m. Pacific Time (5 p.m. Eastern Time) to provide a corporate update and report financial results for the third quarter ended Sept. 30, 2014. A live webcast of the call can be accessed through the investor section of Tekmira's website. Or, alternatively, to access the conference call, please dial 914-495-8556 or 1-866-393-1607.
An archived webcast will be available on the Tekmira website approximately two hours after the event. Alternatively, you may access a replay of the conference call by calling 404-537-3406 or 1-855-859-2056 and referencing conference ID 7467109.
About RNAi and Tekmira's LNP
RNAi therapeutics have the potential to treat a number of human diseases by silencing disease-causing genes. The discoverers of RNAi, a gene-silencing mechanism used by all cells, were awarded the 2006 Nobel Prize for physiology or medicine. RNAi trigger molecules often require delivery technology to be effective as therapeutics. Tekmira believes its LNP technology represents the most advanced and widely adopted delivery technology for the systemic delivery of RNAi triggers. Tekmira's LNP platform is being utilized in multiple clinical trials in various disease areas by Tekmira and its partners. Tekmira's LNP technology (formerly referred to as stable nucleic acid-lipid particles or SNALP) encapsulates RNAi triggers with high efficiency in uniform lipid nanoparticles that are effective in delivering these therapeutic compounds to disease sites. Tekmira's LNP formulations are manufactured by a proprietary method which is robust, scalable and highly reproducible, and LNP-based products have been reviewed by multiple regulatory agencies for use in clinical trials. LNP formulations comprise several lipid components that can be adjusted to suit the specific application.
About joint project manager medical countermeasure systems bio-defence therapeutics (JPM-MCS-BDTX)
Tekmira's Ebola program is being conducted under a $140-million contract with the U.S. Department of Defense joint project manager medical countermeasure systems bio-defence therapeutics. JPM-MCS-BDTX, a component of the Joint Program Executive Office for Chemical and Biological Defence, aims to provide U.S. military forces and the nation with safe, effective and innovative medical solutions to counter chemical, biological, radiological and nuclear threats. JPM-MCS facilitates the advanced development and acquisition of medical countermeasures and systems to enhance bio-defence response capability.
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