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Aeterna Zentaris Inc (3)
Symbol AEZS
Shares Issued 23,509,871
Close 2020-03-30 C$ 0.71
Recent Sedar Documents

Aeterna Zentaris loses $6.04-million in 2019

2020-03-30 17:10 ET - News Release

Dr. Klaus Paulini

AETERNA ZENTARIS REPORTS FOURTH QUARTER AND FULL-YEAR 2019 FINANCIAL AND OPERATING RESULTS AND PROVIDES BUSINESS UPDATE

Aeterna Zentaris Inc. has released its financial and operating results for the fourth quarter and year ended Dec. 31, 2019.

The Company also provided an update on its clinical program to develop macimorelin for the diagnosis of child-onset growth hormone deficiency (CGHD), an area of significant unmet need, and its plans to expand macimorelin for the diagnosis of adult growth hormone deficiency (AGHD) in Europe.

"We have been working diligently with our U.S. and Canadian commercialization partner, Novo Nordisk, to increase the awareness and access to Macrilen (macimorelin) for the diagnosis of AGHD and are pleased with the progress made in this regard over the fourth quarter of 2019. The inclusion of macimorelin in the American Association of Clinical Endocrinologists 2019 Guidelines was an important milestone that reflects the hard work of both teams and we intend to build on this momentum," commented Dr. Klaus Paulini, Chief Executive Officer of Aeterna Zentaris. "Additionally, our business development efforts to secure a marketing partner for macimorelin for the diagnosis of AGHD in Europe and other key markets remain ongoing."

Recent Highlights

  • Closed $4.5 million registered direct offering priced at-the-market;
  • Announced the completion of patient recruitment in the AEZS-130-P01 ("Study P01") dose-finding pediatric study of macimorelin; and
  • Announced the inclusion of macimorelin in the American Association of Clinical Endocrinologists (AACE) and American College of Endocrinology (ACE) 2019 Guidelines for Management of Growth Hormone Deficiency in Adults and Patients Transitioning from Pediatric to Adult Care.

Dr. Paulini continued, "We also see a significant opportunity in the use of macimorelin for the diagnosis of CGHD and with the upcoming results of the P01 study expected early next quarter, we believe we will be well positioned with a validated dose to move into our planned P02 study, an efficacy and safety registration study."

For more information about Study P01, please visit EU Clinical Trials Register and reference EudraCT #2018-001988-23.

Macimorelin

The Company's lead product, macimorelin, is the only FDA approved oral drug indicated for the diagnosis of AGHD and is currently marketed in the United States under the tradename Macrilen, by Novo Nordisk. Aeterna is currently developing macimorelin for the diagnosis of CGHD, an area of significant unmet need, in collaboration with Novo Nordisk.

Upcoming Anticipated Program Milestones

  • Announce results of CGHD dose-ranging study (AEZS-130-P01) in Q2 2020;
  • Commence CGHD safety and efficacy study (AEZS-130-P02: multi-national, including U.S.); and
  • Advance business development efforts to secure a marketing partner for macimorelin for the diagnosis of AGHD in Europe and other key markets.

The Company is closely monitoring the evolving situation with coronavirus, or COVID-19, and is following guidance from health authorities. COVID-10 is affecting the global community and is adversely affecting our business operations, in a manner which at this time cannot be fully determined or quantified. The situation with coronavirus is rapidly evolving and the impact of COVID-19, including travel and business restrictions, and other impediments to undertaking clinical studies, may significantly affect our business, operations, results, projected timelines and market price for our common shares. Like many of our peers, we have put into place a robust risk mitigation plan to ensure the safety of our employees, partners and community. For more information, please see the Risk Factor entitled "The economic effects of a pandemic, epidemic or outbreak of an infectious disease could adversely affect our operations or the market price of our Common Shares" in our Annual Report on Form 20-F for the year ended December 31, 2019.

Summary of Full Year 2019 Financial Results

All amounts are in U.S. dollars

For the twelve-month period ended December 31, 2019, the Company reported a consolidated net loss of $6.0 million, or $0.35 loss per common share (basic), as compared with a consolidated net income of $4.2 million, or $0.25 income per common share (basic), for the twelve-month period ended December 31, 2018. The $10.2 million decline in net results is primarily from a reduction of $26.3 million in revenue offset by $5.6 million in tax expense, $6.3 million decline in operating expenses, $2.8 million increase in net finance income and $1.4 million decline in settlements.

Revenues

The Company reported total revenue for the twelve-month period ended December 31, 2019 of $0.5 million as compared with $26.9 million for the same period in 2018, representing a decline of $26.4 million. The decline in total revenue in 2019 relates primarily to the one-time $24.0 million cash payment received from executing the License Agreement in January 2018 and the initial delivery of Macrilen (macimorelin) to our licensee.

Operating Expenses

The Company reported total operating expense for the twelve-month period ended December 31, 2019 of $10.8 million as compared with $17.0 million for the same period in 2018, representing a decrease of $6.2 million. This net decline arises primarily from a $2.3 million reduction in general and administration expenses, a $1.9 million reduction in selling costs, a $1.7 million decline in cost of sales and a $1.1 million reduction in research and development costs, offset by $0.5 million increase in restructuring costs, $0.02 million impairment in right to use asset[s] and $0.2 million write-off of other current assets.

Net Finance Income

The Company reported net finance income for the twelve-month period ended December 31, 2019 of $4.0 million as compared with $1.2 million for the same period in 2018, representing an increase of $2.8 million. This is primarily due to a $4.3 million increase change in fair value of warrant liability, offset by a reduction in gain due to foreign currency exchange rates of $0.6 million and a $0.9 million increase in other finance costs.

Consolidated Financial Statements and Management's Discussion and Analysis

For reference, the Management's Discussion and Analysis of Financial Condition and Results of Operations for the fourth quarter and fiscal 2019, as well as the Company's audited consolidated financial statements as at December 31, 2019, 2018 and for the years ended December 31, 2019, 2018 and 2017 will be available at www.zentaris.com in the "Investors" section or at the Company's profile at www.sedar.com and www.sec.gov .

About Aeterna Zentaris Inc.

Aeterna Zentaris Inc. is a specialty biopharmaceutical company commercializing and developing therapeutics and diagnostic tests. The Company's lead product, Macrilen (macimorelin), is the first and only U.S. FDA and European Commission approved oral test indicated for the diagnosis of adult growth hormone deficiency (AGHD). Macrilen is currently marketed in the United States through a license agreement with Novo Nordisk. Aeterna Zentaris retains its rights to macimorelin outside of the U.S. and Canada.

           Condensed Consolidated Statements of Comprehensive Loss Information
                    (in thousands, except share and per share data)

                             Three months ended December 31,     Years ended December 31,  
                                      2019             2018        2019    2018     2017  
                                       $                 $          $        $         $
Revenues
License fees                            19              (332)         74  24,325  458
Product sales                            -             1,446         129   2,167        -
Royalty income                          16               184          45     184        -
Sales commission                         -                 -           -     110      465
Supply chain                           (17)               94         284      95        -
Total revenues                          18             1,392         532  26,881      923
Operating expenses
Cost of sales                          309             1,413         410   2,104        -
Research and development costs         263               767       1,837   2,932   10,704
General and administrative expenses  1,691             1,665       6,615   8,894    8,198
Selling expenses                        38               588       1,214   3,109    5,095
Restructuring costs                   (266)                -         507       -        -
Impairment of right of use asset      (254)                -          22       -        -
Write-off of other current assets        -                 -         169       -        -
Total operating expenses             1,781             4,433      10,774  17,039   23,997
(Loss) income from operations       (1,763)           (3,041)    (10,242)  9,842  (23,074)
Settlements                              -            (1,400)          -  (1,400)       -
Gain due to changes in foreign
currency exchange rates                 26                64          87     656      502
Change in fair value
of warrant liability                   533            (1,489)      4,518     263    2,222
Other finance (costs) income            10               104        (593)    278       75
Net finance income (costs)             569            (1,321)      4,012   1,197    2,799
(Loss) income before income taxes   (1,194)           (5,762)     (6,230)  9,639  (20,275)
Income tax recovery (expense)          188               636         188  (5,452)   3,479
Net (loss) income                   (1,006)           (5,126)     (6,042)  4,187  (16,796)
Other comprehensive (loss) income:
Foreign currency
translation adjustments               (268)              (13)         83    (260)  (1,430   )
Actuarial gain (loss)
on defined benefit plans               959              (418)     (1,068)    193      694
Comprehensive (loss) income           (315)           (5,557)     (7,027)  4,120  (17,532)
Net loss per share (basic)           (0.05)            (0.31)      (0.35)   0.25    (1.12)
Net loss per share (diluted)         (0.05)            (0.31)      (0.35)   0.24    (1.12)

We seek Safe Harbor.

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