All amounts are in US dollars
QUEBEC CITY, Nov. 4, 2014
/PRNewswire/ - Aeterna Zentaris Inc. (NASDAQ: AEZS) (TSX: AEZ) (the
"Company"), a specialty biopharmaceutical company engaged in
developing and commercializing novel treatments in oncology and
endocrinology, today reported financial and operating results as at
and for the third quarter ended September
30, 2014.
Research and development ("R&D") costs, net of refundable
tax credits and grants, for the three-month period ended
September 30, 2014, were $6.1 million, as compared to $6.2 million for the same period in 2013. R&D
costs for the quarter ended September 30,
2014 include a provision for restructuring costs, amounting
to approximately $1.6 million, for
severance payments and other directly related costs associated with
our R&D restructuring activities.
Selling, general and administrative ("SG&A") expenses
were $3.7 million for the three-month
period ended September 30, 2014,
compared to $2.4 million for the same
period in 2013. The increase in SG&A expenses is mainly related
to higher comparative foreign exchange losses, the ramping up of
our pre-commercialization activities associated with Macrilen™ and
the recording of restructuring costs related to planned
administrative staff redundancies.
Net loss for the three-month period ended September 30, 2014 was $11.3 million, or $0.20 per basic and diluted share, compared to a
net income of $3.8 million, or
$0.13 per basic and diluted share,
for the same period in 2013. The decrease in net income is due
largely to lower net income from discontinued operations related to
our former Cetrotide® Business, higher comparative
operating expenses and higher comparative net finance costs.
Cash and cash equivalents totaled $42.0 million as at September 30, 2014, as compared to $43.2 million as at December 31, 2013.
David Dodd, Chairman and CEO of
Aeterna Zentaris, commented, "During the quarter, we intensified
our commercial development efforts which resulted in the signing of
a co-promotion agreement with Ascend Therapeutics for the selling
of their already marketed leading non patch transdermal hormone
replacement therapy product, EstroGel®, in specific US
territories. This agreement will jump start our commercial
activities as we expect to start the field selling of
EstroGel® in a few weeks through our sales force of
about 20 representatives. We intend to pursue additional commercial
opportunities, including other co-promotional arrangements,
in-licensing transactions or product acquisitions throughout the
remainder of the year. For Macrilen™, we continued to focus on our
pre-commercialization activities while building our core business
team. We are awaiting the FDA's imminent decision on its review of
our NDA for Macrilen™, which has a PDUFA date of November 5, 2014. If approved, Macrilen™ would be
the only FDA indicated oral drug for use in evaluating Adult Growth
Hormone Deficiency. As for our ongoing ZoptEC Phase 3 trial in
endometrial cancer, we are very pleased to report that we have
completed clinical site initiation with 120 sites currently in
operation, and to date, over 300 of the expected 500 patients have
been entered into the trial. We are on track to reach the number of
patients required to secure our first interim analysis in the first
half of 2015. Finally, we started implementing our global resources
optimization program which is expected to lead to the termination
of 31 employees over a 12-month period. This program should enable
us to streamline R&D activities, increase commercial operations
and flexibility, ultimately reduce our operating cash burn and more
appropriately align our financial resources with our strategic goal
of transitioning into a commercially operating specialty
biopharmaceutical company."
Dennis Turpin, CFO of Aeterna
Zentaris commented, "With our cash position, combined with the
streamlining of our R&D activities, we are able to continue to
advance our strategic programs in pursuit of our near-term
milestones."
Q3 2014 HIGHLIGHTS
Pipeline
Macrilen™ (macimorelin)
- Ongoing FDA review of the Company's New Drug Application
("NDA") for Macrilen™, a ghrelin agonist, which, if approved, will
be the first orally-administered drug indicated for the evaluation
of AGHD. Results from the FDA's review are expected imminently, as
the NDA has a Prescription Drug User Fee Act ("PDUFA") date of
November 5, 2014.
- Ongoing pre-commercialization activities for Macrilen™,
including the hiring of new employees and the appointment of a
specialized third-party contract sales organization which will
provide sales representatives and related commercial
activities.
Zoptarelin Doxorubicin
- Completed site initiation for the current
ZoptEC (Zoptarelin doxorubicin in Endometrial
Cancer) Phase 3 trial in endometrial cancer with 120 sites
in operation. To date, over 300 patients of the expected 500
patients have been entered into this trial.
Commercial Developments
- Signing of a co-promotion services agreement (the "Co-promotion
Agreement") with Ascend Therapeutics US, LLC ("Ascend"). Under the
terms of the Co-promotion agreement, Aeterna Zentaris will market
Ascend's leading non-patch transdermal hormone replacement therapy
product, EstroGel®, in specific agreed-upon US
territories in exchange for a sales commission. The Co-promotion
Agreement also provides that, following regulatory approval of
Macrilen™, Ascend will provide similar services to Aeterna Zentaris
in exchange for a sales commission.
- Subsequent to quarter-end, implementation of the Company's
full-time contract US sales force of about 20 representatives for
the field selling of EstroGel®, which is expected to
start during the week of November 17,
2014. Together with Ascend's existing sales force, there
will be a total of 53 sales representatives covering sales
activities related to EstroGel®. This combined sales
force also will sell Macrilen™, following regulatory approval
thereof.
Resource Optimization and Executive
Appointment
- Implementation of the global resources optimization program
(the "Resource Optimization Program") as part of the Company's
objective of transitioning into a commercially operating specialty
biopharmaceutical company, by streamlining R&D activities and
increasing commercial operations and flexibility. The Resource
Optimization Program is expected to result in the termination of 31
employees over a period of about 12 months.
- Subsequent to quarter-end, appointment of Philip A. Theodore as Senior Vice President,
Chief Administrative Officer, General Counsel and Corporate
Secretary.
Corporate Developments
- Between July 1, 2014 and
September 30, 2014, the Company
issued a total of approximately 7.4 million common shares under its
At-the-Market ("ATM") sales agreement, entered into May 2014 (the "May
2014 ATM Program"), at an average price of $1.36 for aggregate gross proceeds of
approximately $10.1 million, less
cash and non-cash transaction costs of approximately $0.3 million. The May
2014 ATM Program provides that the Company may, at its
discretion, from time to time during the term of the sales
agreement, sell up to a maximum of approximately 14.0 million of
its common shares through ATM issuances on the NASDAQ, up to an
aggregate amount of $15.0
million.
- Between October 1, 2014 and
November 4, 2014, the Company issued
a total of approximately 1.6 million common shares under the
May 2014 ATM Program for aggregate
gross proceeds of approximately $2.1
million.
CONFERENCE CALL
Management will be hosting a conference call for the investment
community beginning at 8:30 a.m. (Eastern
Time) tomorrow, Wednesday, November 5, 2014, to discuss the
2014 third quarter results. Individuals interested in participating
in the live conference call by telephone may dial, in Canada, 514-807-9895 or 647-427-7450, outside
Canada, 888-231-8191. They may
also listen through the Internet at www.aezsinc.com in the
"Newsroom" section. A replay will be available on the Company's
website for 30 days following the live event.
For reference, the Management's Discussion and Analysis of
Financial Condition and Results of Operations for the third quarter
of 2014, as well as the Company's condensed interim consolidated
financial statements, can be found at www.aezsinc.com in the
"Investors" section.
About Aeterna Zentaris Inc.
Aeterna Zentaris is a specialty biopharmaceutical company
engaged in developing and commercializing novel treatments in
oncology and endocrinology. For more information, visit
www.aezsinc.com
Forward-Looking Statements
This press release contains forward-looking statements made
pursuant to the safe harbor provisions of the US Securities
Litigation Reform Act of 1995. Forward-looking statements involve
known and unknown risks and uncertainties that could cause the
Company's actual results to differ materially from those in the
forward-looking statements. Such risks and uncertainties include,
among others, the availability of funds and resources to pursue
R&D projects, the successful and timely completion of clinical
studies, the risk that safety and efficacy data from any of our
Phase 3 trials may not coincide with the data analyses from
previously reported Phase 1 and/or Phase 2 clinical trials, the
ability of the Company to efficiently commercialize one or more of
its products or product candidates, the ability of the Company to
take advantage of business opportunities in the pharmaceutical
industry, uncertainties related to the regulatory process and
general changes in economic conditions. Investors should consult
the Company's quarterly and annual filings with the Canadian and US
securities commissions for additional information on risks and
uncertainties relating to forward-looking statements. Investors are
cautioned not to rely on these forward-looking statements. The
Company does not undertake to update these forward-looking
statements. We disclaim any obligation to update any such factors
or to publicly announce the result of any revisions to any of the
forward-looking statements contained herein to reflect future
results, events or developments, unless required to do so by a
governmental authority or by applicable law.
Attachment: Financial summary
Condensed Interim
Consolidated Statements of Comprehensive (Loss) Income
Information
|
|
|
|
Three months
ended
September 30,
|
|
Nine months
ended
September 30,
|
(in thousands,
except share and per share data)
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
$
|
|
$
|
|
$
|
|
$
|
Revenues
|
|
|
|
|
|
|
|
|
Sales and
royalties
|
|
—
|
|
—
|
|
—
|
|
96
|
License fees and
other
|
|
—
|
|
17
|
|
—
|
|
6,079
|
|
|
—
|
|
17
|
|
—
|
|
6,175
|
Operating
expenses
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
—
|
|
—
|
|
—
|
|
51
|
Research and
development costs, net of refundable tax credits and
grants
|
|
6,142
|
|
6,230
|
|
17,434
|
|
15,939
|
Selling, general and
administrative expenses
|
|
3,701
|
|
2,435
|
|
9,014
|
|
9,689
|
|
|
9,843
|
|
8,665
|
|
26,448
|
|
25,679
|
Loss from
operations
|
|
(9,843)
|
|
(8,648)
|
|
(26,448)
|
|
(19,504)
|
Finance
income
|
|
1,091
|
|
1,384
|
|
5,266
|
|
3,567
|
Finance
costs
|
|
(2,877)
|
|
(535)
|
|
—
|
|
(707)
|
Net finance
(costs) income
|
|
(1,786)
|
|
849
|
|
5,266
|
|
2,860
|
Net loss from
continuing operations
|
|
(11,629)
|
|
(7,799)
|
|
(21,182)
|
|
(16,644)
|
Net income from
discontinued operations
|
|
292
|
|
11,641
|
|
465
|
|
31,702
|
Net (loss)
income
|
|
(11,337)
|
|
3,842
|
|
(20,717)
|
|
15,058
|
Other
comprehensive (loss) income:
|
|
|
|
|
|
|
|
|
Items that may be
reclassified subsequently to profit or loss:
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
(387)
|
|
550
|
|
(481)
|
|
649
|
Items that will not
be reclassified to profit or loss:
|
|
|
|
|
|
|
|
|
|
Actuarial loss on
defined benefit plans
|
|
(1,099)
|
|
—
|
|
(3,169)
|
|
—
|
Comprehensive
(loss) income
|
|
(12,823)
|
|
4,392
|
|
(24,367)
|
|
15,707
|
Net loss per share
(basic and diluted) from continuing operations
|
|
(0.20)
|
|
(0.26)
|
|
(0.37)
|
|
(0.62)
|
Net income per
share (basic and diluted) from discontinued
operations
|
|
—
|
|
0.39
|
|
0.01
|
|
1.18
|
Net (loss) income
per share (basic and diluted)
|
|
(0.20)
|
|
0.13
|
|
(0.36)
|
|
0.56
|
Weighted average
number of shares outstanding:
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
59,163,710
|
|
29,627,222
|
|
56,881,919
|
|
26,848,668
|
Condensed Interim
Consolidated Statement of Financial Position
Information
|
|
|
|
As at September
30,
|
|
As at December
31,
|
(in
thousands)
|
|
2014
|
|
2013
|
|
|
$
|
|
$
|
Cash and cash
equivalents
|
|
41,952
|
|
43,202
|
Trade and other
receivables and other current assets
|
|
2,124
|
|
2,453
|
Restricted cash
equivalents
|
|
794
|
|
865
|
Property, plant and
equipment
|
|
705
|
|
1,351
|
Other non-current
assets
|
|
9,942
|
|
11,325
|
Total
assets
|
|
55,517
|
|
59,196
|
Payables and other
current liabilities1
|
|
7,364
|
|
7,242
|
Warrant
liability
|
|
22,304
|
|
18,010
|
Non-financial
non-current liabilities2
|
|
18,445
|
|
16,880
|
Total
liabilities
|
|
48,113
|
|
42,132
|
Shareholders'
equity
|
|
7,404
|
|
17,064
|
Total liabilities
and shareholders' equity
|
|
55,517
|
|
59,196
|
_________________________
|
1 Of which approximately $1.6
million is related to a provision for restructuring
costs.
|
2 Comprised mainly of employee
future benefits and provisions for onerous contracts.
|
SOURCE Aeterna Zentaris Inc.