Threshold Pharmaceuticals Reports First Quarter Financial Results
May 05 2016 - 4:02PM
Threshold Pharmaceuticals, Inc. (Nasdaq:THLD), a clinical-stage
biopharmaceutical company developing novel therapies for cancer,
today reported financial results for the first quarter ended March
31, 2016 and provided an update on the Company's corporate and
clinical development activities.
“We remain focused on establishing a potential regulatory path
forward for evofosfamide as well as a possible strategic partnering
initiative, and we are making progress on both of these fronts,”
said Barry Selick, Ph.D., Chief Executive Officer of Threshold. “I
am also pleased with the appointment of Stew Kroll as Chief
Operating Officer who most capably leads the strategy, design and
execution of our clinical development programs.”
Recent HighlightsEvofosfamide
– The Company’s lead product candidate is an investigational
hypoxia-activated prodrug that is designed to be activated under
tumor hypoxic conditions, a hallmark of many cancers. Additional
analysis of the MASTRO Phase 3 data combined with previous Phase 2
experience strongly suggests that evofosfamide plus gemcitabine is
an active regimen in patients with pancreatic cancer, most notably
in the Japanese patients.
- Conducted additional analyses of evofosfamide data in
pancreatic cancer; the Company intends to discuss potential
registration pathways with health regulatory authorities; and
- Continued ongoing clinical development collaborations
investigating evofosfamide in patients with pancreatic
neuroendocrine tumors (pNET), recurrent glioblastoma (GBM) and
hepatocellular carcinoma (HCC).
Tarloxotinib – Beyond the Company’s
evofosfamide program, the clinical development team is focused on
tarloxotinib, a hypoxia-activated epidermal growth factor receptor
(EGFR) tyrosine kinase inhibitor (TKI), which is designed to
selectively release an irreversible EGFR-TKI in hypoxic tumors.
- Continued to enroll patients in two proof-of-concept Phase 2
clinical trials in patients with advanced non-small cell lung
cancer (NSCLC) as well as metastatic head and neck squamous cell
carcinoma; the Company plans to share preliminary results from both
trials in mid-2016.
First Quarter 2016 Financial Results
- Cash, cash equivalents and marketable securities totaled $38.0
million at March 31, 2016 compared to $48.7 million at December 31,
2015; the net decrease was a result of operating cash requirements
for the quarter ended March 31, 2016, including the payment of $2.3
million of accrued severance benefits related to the previously
announced workforce reduction in December of 2015. With the
previously announced decision to cease joint development of
evofosfamide under the Company’s former collaboration with Merck
KGaA and the workforce reduction, the Company expects its quarterly
operating cash requirements to decrease for the remainder of fiscal
year 2016 compared to the first quarter ended March 31, 2016.
- No revenue was recognized in the first quarter ended March 31,
2016 compared to $3.7 million for the same period of 2015. Revenue
for the quarter ended March 31, 2015 related to the amortization of
the aggregate of $110 million in upfront and milestone payments
received from the Company’s former collaboration with Merck KGaA,
Darmstadt, Germany. The revenue from the upfront payment and
milestone payments received under the agreement were previously
being amortized over the relevant performance period, rather than
being immediately recognized when the upfront payment and
milestones were earned or received. As a result of Merck KGaA,
Darmstadt, Germany's and the Company’s decision to cease further
joint development of evofosfamide in December 2015, the Company
immediately recognized all of the remaining deferred revenue into
revenue during the quarter ending December 31, 2015. Also as
a result of the termination of the agreement, the Company is no
longer eligible to receive any further milestone payments from
Merck KGaA, Darmstadt, Germany.
- Research and development expenses were $6.0 million for the
first quarter ended March 31, 2016, compared to $10.7 million for
the same period in 2015. The decrease in research and development
expenses, net of reimbursement for Merck KGaA, Darmstadt, Germany’s
70 percent share of total eligible collaboration expenses for
evofosfamide, was due primarily to a $3.1 million decrease in
employee related expenses, including a $0.5 million decrease in
non-cash stock-based compensation expense and a $1.6 million
decrease in clinical development expenses and consulting expenses.
The Company expects research and development expenses to continue
to decline in 2016 as result of the decision to cease further joint
development of evofosfamide under the Company’s former
collaboration with Merck KGaA and the workforce reduction.
- General and administrative expenses were $2.2 million for the
first quarter of 2016 compared to $2.6 million for the same period
in 2015. The decrease in general and administrative expenses was
due primarily to a $0.2 million decrease in consulting expenses and
a $0.2 million decrease in employee related expenses.
- Non-cash stock-based compensation expense included in total
operating expenses was $0.8 million for the first quarter of 2016
compared to $1.4 million for the same period in 2015. The decrease
in stock-based compensation expense was due to the amortization of
a smaller number of options with lower fair values.
- Net loss for the first quarter of 2016 was $7.9 million
compared to $11.2 million for the same period in 2015. Included in
the net loss for the first quarter of 2016 was an operating loss of
$8.3 million and non-cash income of $0.4 million compared to an
operating loss of $9.6 million and non-cash expense of $1.5 million
for the first quarter of 2015. The non-cash income or expense is
related to changes in the fair value of the Company’s outstanding
and exercised warrants that was classified as other income
(expense).
About EvofosfamideEvofosfamide (previously
known as TH-302) is an investigational hypoxia-activated prodrug of
a bis-alkylating agent that is preferentially activated under
severe hypoxic tumor conditions, a feature of many solid tumors.
Areas of low oxygen levels (hypoxia) in solid tumors are due to
insufficient blood vessel supply. Similarly, the bone marrow of
patients with hematological malignancies has also been shown, in
some cases, to be severely hypoxic. On December 6, 2015, the
Company announced the outcomes of two Phase 3 studies (MAESTRO and
TH-CR-406/SARC021) of evofosfamide stating that neither study met
its primary endpoint.
About Tarloxotinib BromideTarloxotinib bromide
(the proposed International Nonproprietary Name, previously known
as TH-4000), or "tarloxotinib", is a prodrug designed to
selectively release a covalent (irreversible) EGFR tyrosine kinase
inhibitor under severe hypoxia, a feature of many solid tumors.
Accordingly, tarloxotinib has the potential to effectively shut
down aberrant EGFR signaling in a tumor-selective manner, thus
potentially avoiding or reducing the systemic side effects
associated with currently available EGFR tyrosine kinase
inhibitors. Tarloxotinib is currently being evaluated in two Phase
2 proof-of-concept trials: one for the treatment of patients with
mutant EGFR-positive, T790M-negative advanced non-small cell lung
cancer progressing on an EGFR tyrosine kinase inhibitor, and the
other for patients with recurrent or metastatic squamous cell
carcinomas of the head and neck or skin. Threshold licensed
exclusive worldwide rights to tarloxotinib from the University of
Auckland, New Zealand, in September 2014.
About Threshold Pharmaceuticals Threshold is a
clinical-stage biopharmaceutical company focused on the discovery
and development of drugs and diagnostic agents targeting tumor
hypoxia, the low oxygen condition found in microenvironments of
most solid tumors as well as the bone marrows of some hematologic
malignancies. This approach offers broad potential to treat a
variety of cancers. By selectively targeting tumor cells, we are
building a pipeline of drugs that hold promise to be more effective
and less toxic to healthy tissues than conventional anticancer
drugs. For additional information, please visit the Company’s
website.
Forward-Looking StatementsExcept for statements
of historical fact, the statements in this press release are
forward-looking statements, including all statements regarding
anticipated development activities and clinical development outlook
related to company-sponsored clinical trials for evofosfamide and
tarloxotinib, including establishing collaborations for our product
candidates, the planned analyses of evofosfamide and tarloxotinib
clinical trials, and the timing thereof; the expected efficient
execution of, and the anticipated timing of protocol-specified
events and the availability of the results of the primary efficacy
analyses from the evofosfamide and tarloxotinib clinical trials;
the potential submission of marketing applications for
evofosfamide; the varying interpretations of the data obtained from
preclinical and clinical testing could delay, limit or prevent
regulatory approval; the timing of the Phase 2 proof-of-concept
study of tarloxotinib; potential development opportunities for
evofosfamide, including the potential for Threshold’s evofosfamide
Phase 3 clinical trial to support registration for the treatment of
patients with advanced pancreatic cancer, and other cancers; and
the therapeutic potential of tarloxotinib. These statements involve
risks and uncertainties that can cause actual results to differ
materially from those in such forward-looking statements. Potential
risks and uncertainties include, but are not limited to: the
ability of Threshold to establish collaborations for our product
candidates or otherwise raise substantial additional capital and
even if we are successful in raising the additional capital
necessary, Threshold’s ability to advance the development of its
product candidates; Threshold's dependence on the transfer of
development activities from Merck KGaA, Darmstadt, Germany,
including its dependence on decisions by Merck KGaA, Darmstadt,
Germany regarding the amount and timing of resource expenditures
for the transfer of evofosfamide development activities and
the risk of potential disagreements with Merck KGaA, Darmstadt,
Germany, regarding the time and expense required to transfer
clinical trials and analyze data; the uncertainty of clinical
success and regulatory approval; the risk that later analysis may
not confirm the results of earlier analysis; the risks that the
design of, or data collected from, the Phase 3 clinical trials of
evofosfamide may be inadequate to demonstrate safety and efficacy,
or otherwise may be insufficient to support any marketing
authorization submissions and/or regulatory approvals, and that
despite the potential benefits of the SPA agreements with the FDA,
significant uncertainty remains regarding the regulatory approval
process for evofosfamide and that evofosfamide may not receive any
marketing approvals in a timely manner or at all; issues arising in
the regulatory process and the results of such clinical trials
(including product safety issues and efficacy results); dependence
of Threshold on single source suppliers, including the risk that
these single source suppliers may be unable to meet clinical supply
demands for evofosfamide and/or tarloxotinib which could
significantly delay the development of evofosfamide and/or
tarloxotinib; Threshold’s ability to enroll or complete
tarloxotinib clinical trials, including the ability of Threshold to
complete the ongoing clinical trials in the expected timeframe or
at all; the risks that Threshold’s evaluation of tarloxotinib is at
an early stage and it is possible that tarloxotinib may not be
found to be safe or effective in the Phase 2 proof-of-concept study
of tarloxotinib or in any other studies of tarloxotinib that
Threshold may conduct, and that Threshold may otherwise fail to
realize the anticipated benefits of its licensing of this product
candidate; the amount and timing of licensing fees, milestone
payments and royalty payments that we are obligated to pay; and
Threshold’s need for and the availability of resources to develop
evofosfamide and tarloxotinib and to support Threshold’s
operations. Further information regarding these and other risks is
included under the heading "Risk Factors" in Threshold's Annual
Report on Form 10-K, which was filed with the Securities and
Exchange Commission on March 10, 2016 and is available from the
SEC's website (www.sec.gov) and on our website
(www.thresholdpharm.com) under the heading "Investors". We
undertake no duty to update any forward-looking statement made in
this news release.
|
THRESHOLD PHARMACEUTICALS, INC. |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(in thousands, except per share
amounts) |
(Unaudited) |
|
|
|
|
Three Months Ended |
|
March 31, |
|
|
2016 |
|
|
2015 |
|
|
|
|
|
|
|
|
Revenue |
$ |
— |
|
$ |
3,681 |
|
|
|
|
Operating
expenses |
|
|
Research and development |
|
6,005 |
|
|
10,680 |
|
General and administrative |
|
2,249 |
|
|
2,616 |
|
Total Operating
Expenses |
|
8,254 |
|
|
13,296 |
|
|
|
|
Loss from
operations |
|
(8,254 |
) |
|
(9,615 |
) |
|
|
|
Interest income (expense), net |
|
32 |
|
|
33 |
|
Other Income (expense), net
(1) |
|
370 |
|
|
(1,572 |
) |
|
|
|
Net loss |
|
(7,852 |
) |
|
(11,154 |
) |
|
|
|
Net loss per
share: |
|
|
Basic |
$ |
(0.11 |
) |
$ |
(0.17 |
) |
Diluted |
$ |
(0.11 |
) |
$ |
(0.17 |
) |
|
|
|
Weighted-average shares used in net loss per |
|
|
share
calculations: |
|
|
Basic |
|
71,488 |
|
|
66,732 |
|
Diluted |
|
71,488 |
|
|
66,732 |
|
|
|
|
(1) Non-cash income
(expense) related to the change in fair value of the Company's
outstanding |
|
and exercised warrants, classified
as other income (expense). |
|
|
|
THRESHOLD PHARMACEUTICALS, INC. |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(in thousands) |
|
|
|
|
|
|
|
March
31,2016 |
December
31,2015(1) |
|
(unaudited) |
|
|
|
|
Assets |
|
|
|
|
|
Cash, cash equivalents and |
|
|
marketable securities |
$ |
37,966 |
|
$ |
|
48,680 |
|
|
Collaboration Receivable |
|
777 |
|
|
|
1,891 |
|
|
Prepaid expenses and other current
assets |
|
1,880 |
|
|
|
2,599 |
|
|
Property and equipment, net |
|
261 |
|
|
|
333 |
|
|
Other assets |
|
166 |
|
|
|
166 |
|
|
Total assets |
$ |
41,050 |
|
$ |
|
53,669 |
|
|
|
|
|
Liabilities and
stockholders' equity |
|
|
|
|
|
Total current liabilities |
$ |
5,575 |
|
$ |
|
10,828 |
|
|
Long-term liabilities (2) |
|
1,603 |
|
|
|
1,995 |
|
|
Stockholders' equity (deficit) |
|
33,872 |
|
|
|
40,846 |
|
|
Total liabilities and stockholders'
equity (deficit) |
$ |
41,050 |
|
$ |
|
53,669 |
|
|
|
|
|
|
|
|
(1)
Derived from audited financial statements |
(2) Includes
as of March 31, 2016 and December 31 2015, $1.5 million and $1.9
million of warrant liability, respectively. |
Contact:
Denise Powell
denise@redhousecomms.com
510.703.9491
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