Galena Biopharma, Inc. (NASDAQ:GALE), a biopharmaceutical company
committed to the development and commercialization of hematology
and oncology therapeutics that address unmet medical needs, today
reported its financial results for the quarter ended June 30, 2016.
As announced on June 29, 2016, Galena discontinued its NeuVax™
(nelipepimut-S) Phase 3 PRESENT (Prevention of
Recurrence in
Early-Stage, Node-Positive Breast
Cancer with Low to Intermediate HER2 Expression
with NeuVax Treatment) clinical
trial due to futility in accordance with the recommendation from
the Independent Data Monitoring Committee (IDMC). With support from
outside experts, the Company conducted a thorough investigation of
the trial that confirmed the IDMC recommendation and found no
evidence of a systemic reversal of the treatment arms, as suggested
by the IDMC letter dated June 27, 2016. As a result, Galena is
closing the PRESENT trial.
“While we are clearly disappointed in the outcome of the PRESENT
trial, we are fortunate to have a diversified, robust pipeline
which includes GALE-401 that we are advancing into late stage
development,” said Mark W. Schwartz, Ph.D., President and Chief
Executive Officer. “We plan to meet with the FDA by the end
of the year to discuss our Phase 2/3 clinical trial design for
GALE-401. We expect to initiate a pivotal trial in the first half
of 2017 addressing an unmet medical need in patients with essential
thrombocythemia.”
Dr. Schwartz continued, “We remain committed to the prevention
of recurrence in breast, ovarian, and endometrial cancers. We have
shared the PRESENT information with our investigators for the
NeuVax plus trastuzumab combination trials in breast cancer, and
those trials are continuing as planned. The first data
presentation of the interim safety analysis from the HER2 1+/2+
patients will be at the European Society for Medical Oncology
Congress in October. Our GALE-301 and GALE-302 trials are also
ongoing with multiple data presentations expected this
year.”
Galena will host a webcast and conference call today at 2:00
p.m. P.T./5:00 p.m. E.T. to discuss its financial and business
results. The live webcast will include slides that can be
accessed on the Company's website under the Investors
section/Events and Presentations:
http://investors.galenabiopharma.com/events.cfm. The
conference call can be accessed by dialing (844) 825-4413 toll-free
in the U.S., or (973) 638-3403 for participants outside the U.S.
The Conference ID number is: 51743330. The archived webcast
replay will be available on the Company's website for one year.
FINANCIAL REVIEW
Operations
Operating loss from Galena’s development programs and general
and administrative expenses, classified as continuing operations,
during the three months ended June 30, 2016 was $9.3 million,
including $0.6 million in non-cash stock-based compensation,
compared to an operating loss from continuing operations of $9.1
million, including $0.4 million in non-cash stock-based
compensation for the same period in 2015. Operating loss for the
first half of 2016 was $18.3 million, including $1.3 million in
non-cash stock-based compensation, compared to an operating loss
from continuing operations of $18.0 million, including $0.8 million
in non-cash stock-based compensation for the same period in
2015.
Income from continuing operations for Q2 2016 was $8.3 million,
or $0.05 per basic and diluted share, including $17.6 million in
non-operating income. Loss from continuing operations for Q2 2015
was $13.5 million, or $0.08 per basic and diluted share, including
a $4.3 million non-cash loss on the change in the warrant
liability. Loss from continuing operations for the first half of
2016 was $4.8 million, or $0.03 per basic and diluted share,
including $13.4 million in non-operating income. Loss from
continuing operations for the first half of 2015 was $21.8 million,
or $0.15 per basic and diluted share, including a $3.1 million
non-cash loss on the change in the warrant liability.
The increase in Galena's net non-operating income during the
three and six months ended June 30, 2016 compared to the three
and six months ended June 30, 2015 was largely due to two
factors: a significant decrease in the estimated fair value of
warrants accounted for as liabilities driven by the decline in
Galena's common stock price; and, the significant decrease in the
fair value of the contingent purchase price liability for NeuVax
given the decision to terminate the PRESENT study. This increase in
net non-operating income is reflected as a non-cash gain in the
consolidated financial statements. Management believes the most
relevant measure of our performance is operating loss and loss from
discontinued operations. The non-cash gains in non-operating income
were partially offset by $1.8 million in opt-out litigation
settlements that were paid in July 2016, with $1.65 million paid in
shares of common stock and $0.15 million paid in cash.
Loss from discontinued operations from Galena's former
commercial business for Q2 2016 was $2.9 million, or $0.02 per
basic and diluted share, compared to $2.2 million, or $0.02 per
basic and diluted share, for the same period of 2015. Loss from
discontinued operations for the first half of 2016 was $6.3
million, or $0.03 per basic and diluted share, compared to $4.4
million, or $0.03 per basic and diluted share, for the same period
of 2015.
Net income for Q2 2016 was $5.4 million, or $0.03 per basic and
diluted share, compared to net loss of $15.7 million, or $0.10 per
basic and diluted share, for the same period of 2015. Net loss for
the first half of 2016 was $11.1 million, or $0.06 per basic and
diluted share, compared to $26.2 million, or $0.18 per basic and
diluted share, for the same period of 2015.
Cash and Cash Equivalents
Galena had cash and cash equivalents of approximately $19.6
million as of June 30, 2016, compared with $29.7 million as of
December 31, 2015. The decrease of approximately $10.1 million
in cash and cash equivalents from December 31, 2015 to
June 30, 2016 was attributable primarily to $24.7 million used
in operating activities, $1.1 million in selling expenses related
to the sale of the Company’s commercial products, and $4.8 million
in payments on long-term debt. The decrease was partially offset by
$20.2 million in net proceeds from issuance of common stock and
warrants to purchase common stock in January 2016.
Subsequent to quarter end, on July 13, 2016, Galena closed the
sale to certain institutional investors of common stock in a
registered direct offering, and warrants to purchase common stock
in a concurrent private placement. The net proceeds to Galena,
after deducting placement agent fees and estimated offering
expenses, were approximately $11.7 million.
Additionally, on May 10, 2016, Galena entered into a Securities
Purchase Agreement with JGB Newton Ltd. to sell $25.5 million
principal amount of Debentures. The Debentures include a 6.375%
original issue discount, and, after broker and other expenses, net
proceeds were approximately $23.4 million. The net proceeds are
currently restricted cash, and Galena is in discussions with the
holder of the Debentures to modify the agreement.
SECOND QUARTER AND RECENT ACTIVITIES
Clinical Development
Discontinued NeuVax Phase 3, PRESENT Interim Analysis
based on Independent Data Monitoring Committee
RecommendationOn June 24, 2016, the IDMC met to
conduct a pre-planned safety and futility analysis of the Phase 3
PRESENT (Prevention of Recurrence
in Early-Stage, Node-
Positive Breast Cancer with Low to Intermediate
HER2 Expression
with NeuVax Treatment)
clinical trial. On June 29, 2016, the Company announced the
IDMC recommendation to stop the trial for futility. The Company
immediately stopped the PRESENT trial, and initiated an
investigation into the causes of the recommendation.
Presented GALE-401 Combined Safety Data at the European
Hematology Association 21st Congress. A total of six
trials have been run with GALE-401, five Phase 1 trials in healthy
volunteers (N=98), and one Phase 2 single arm, open label pilot
study in patients with myeloproliferative neoplasms (MPNs) (N=18).
The poster, entitled, “Anagrelide Controlled Release (GALE-401)
Safety Profile Consistently Well Tolerated in Myeloproliferative
Neoplasms Patients and Healthy Volunteers” was designed to
characterize the safety profile of GALE-401 in all subjects treated
to date. The results demonstrated that GALE-401 is well tolerated
in MPN patients as well as in healthy volunteers and predominantly
mild to moderate toxicities were observed that did not reveal any
unexpected adverse events.
Received Two Orphan Drug Designations for GALE-301 and
GALE-301/GALE-302The U.S. Food and Drug Administration
granted two orphan-drug designations for Galena’s two cancer
immunotherapy peptides derived from Folate Binding Protein (FBP)
for the treatment (including prevention of recurrence) of ovarian
cancer: one for GALE-301 (E39), and one for GALE-301 (E39) and
GALE-302 (E39’).
Presented GALE-301 Phase 1/2a Primary Analysis at the
American Society of Clinical Oncology Annual Meeting 2016.
The poster, entitled, “The primary analysis of a phase I/IIa dose
finding trial of a folate binding protein vaccine, E39 + GM-CSF in
ovarian and endometrial cancer patients to prevent
recurrence,” demonstrated that the vaccine is well tolerated
and immunogenic. In the optimal dose group, the results demonstrate
potential clinical benefit for GALE-301 to prevent recurrence in
these patients, and that boosters may sustain this effect.
Received Fast Track Designation for NeuVax On
June 1, 2016, Galena announced that the FDA has designated
NeuVax™, combined with GM-CSF, as a Fast Track development program
for the treatment of patients with early stage, node positive
breast cancer with low to intermediate HER2 expression, otherwise
known as HER2 1+ or 2+, following standard of care.
Presented GALE-301 Phase 1/2a Clinical Booster Data at
the American Association for Cancer Research (AACR) Annual
Meeting. The poster, entitled, “Comparing an
attenuated booster (E39’) vs. E39 booster to potentiate the
clinical benefit of the folate binding protein (FBP)-derived
vaccine (E39 + GM-CSF) in a phase I/IIa trial to prevent recurrence
in endometrial (EC) and ovarian cancer (OC) patients,” randomized
patients to two different boosters: the wildtype peptide
(GALE-301/E39), versus the attenuated peptide (GALE-302/E39’). Both
peptides demonstrated the same tolerable safety profile with only
Grade 1 local reactions and minimal Grade 2 toxicities.
Importantly, the percentage of patients who received two booster
inoculations and remained disease free showed a statistically
significantly improvement in the drug treatment arm, versus the
control arm, regardless of which booster was used.
Corporate
Closed an Underwritten Public Equity
Offering. On July 13, 2016, Galena closed the
previously announced underwritten public offering of common stock
and warrants. The net proceeds to the Company were
approximately $11.7 million.
Derivative and Securities Class Action Lawsuits Granted
Final Court Approval. On June 24, 2016, the U.S.
District Court for the District of Oregon entered a final order and
partial judgment in In re Galena Biopharma, Inc. Securities
Litigation, granting final approval of the settlement. On the same
day, the Court also issued an opinion and order awarding attorney’s
fees of $4.5 million plus costs, which is paid out of the
settlement funds. The settlement provides for a payment of $20
million to the class and the dismissal of all claims against the
Company and current and former officers and directors in connection
with the consolidated federal securities class actions. Of the $20
million settlement payment to the class, $16.7 million was paid by
Galena’s insurance carriers and $2.3 million in cash was paid by
Galena on July 1, 2016, along with $1 million in shares of
common stock (480,053 shares) issued on July 6, 2016.
Appointed Mary Ann Gray, Ph.D. to the Company’s Board of
Directors. Effective April 25, 2016, the Board increased
the number of directors from eight to nine directors and appointed
Mary Ann Gray, Ph.D. as a Class III director. Dr. Gray is President
of Gray Strategic Advisors, LLC, which provides strategic advice to
both public and private biotechnology companies. Previously, she
worked at the Federated Kaufmann Fund focusing on both public and
private healthcare investments, and was also a sell-side
biotechnology analyst for nine years. Earlier in her career, Dr.
Gray held scientific positions at Schering Plough and NeoRx,
managed pre-clinical toxicology studies for the National Cancer
Institute through Battelle Memorial Institute, and worked in a
hospital laboratory. Dr. Gray has a Ph.D. in Pharmacology from the
University of Vermont where she focused on novel chemotherapeutic
agents for the treatment of cancer, and she received her B.S. in
biology from the University of South Carolina. She completed her
postdoctoral work at Northwestern University Medical School and
Yale University School of Medicine.
|
GALENA BIOPHARMA, INC. |
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(unaudited) |
(Amounts in thousands, except share and per
share data) |
|
|
Three Months EndedJune 30, |
|
Six Months EndedJune 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Operating expenses: |
|
|
|
|
|
|
|
Research and
development |
$ |
6,175 |
|
|
$ |
7,197 |
|
|
$ |
11,618 |
|
|
$ |
13,022 |
|
General and
administrative |
3,117 |
|
|
1,886 |
|
|
6,642 |
|
|
4,973 |
|
Total
operating expenses |
9,292 |
|
|
9,083 |
|
|
18,260 |
|
|
17,995 |
|
Operating loss |
(9,292 |
) |
|
(9,083 |
) |
|
(18,260 |
) |
|
(17,995 |
) |
Non-operating income
(expense): |
|
|
|
|
|
|
|
Litigation
settlements |
(1,800 |
) |
|
— |
|
|
(1,800 |
) |
|
— |
|
Change in
fair value of warrants potentially settleable in cash |
14,392 |
|
|
(4,267 |
) |
|
10,520 |
|
|
(3,115 |
) |
Interest
expense, net |
(519 |
) |
|
(207 |
) |
|
(611 |
) |
|
(432 |
) |
Change in
fair value of the contingent purchase price liability |
5,497 |
|
|
83 |
|
|
5,327 |
|
|
(238 |
) |
Total
non-operating income (expense), net |
17,570 |
|
|
(4,391 |
) |
|
13,436 |
|
|
(3,785 |
) |
Income (loss) from
continuing operations |
$ |
8,278 |
|
|
$ |
(13,474 |
) |
|
$ |
(4,824 |
) |
|
$ |
(21,780 |
) |
Discontinued
operations |
|
|
|
|
|
|
|
Loss from
discontinued operations |
(2,889 |
) |
|
(2,186 |
) |
|
(6,280 |
) |
|
(4,417 |
) |
Net income (loss) |
$ |
5,389 |
|
|
$ |
(15,660 |
) |
|
$ |
(11,104 |
) |
|
$ |
(26,197 |
) |
Net income (loss) per
common share: |
|
|
|
|
|
|
|
Basic and
diluted net income (loss) per share, continuing operations |
$ |
0.05 |
|
|
$ |
(0.08 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.15 |
) |
Basic and
diluted net income (loss) per share, discontinued operations |
$ |
(0.02 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.03 |
) |
Basic net income (loss)
per share |
$ |
0.03 |
|
|
$ |
(0.10 |
) |
|
$ |
(0.06 |
) |
|
$ |
(0.18 |
) |
Weighted-average common
shares outstanding: basic |
182,034,593 |
|
|
161,383,398 |
|
|
180,703,456 |
|
|
148,647,581 |
|
Weighted-average common
shares outstanding: diluted |
185,477,330 |
|
|
161,383,398 |
|
|
180,703,456 |
|
|
148,647,581 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GALENA BIOPHARMA, INC. |
|
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(Amounts in thousands) |
|
|
June 30, 2016 |
|
December 31, 2015 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and
cash equivalents |
$ |
19,590 |
|
|
$ |
29,730 |
|
Restricted
cash |
24,401 |
|
|
401 |
|
Litigation
settlement insurance recovery |
— |
|
|
21,700 |
|
Prepaid
expenses and other current assets |
1,210 |
|
|
1,398 |
|
Current
assets of discontinued operations |
83 |
|
|
392 |
|
Total
current assets |
45,284 |
|
|
53,621 |
|
Equipment and furnishings,
net |
259 |
|
|
335 |
|
In-process research and
development |
12,864 |
|
|
12,864 |
|
GALE-401 rights |
9,255 |
|
|
9,255 |
|
Goodwill |
5,898 |
|
|
5,898 |
|
Deposits |
218 |
|
|
171 |
|
Total
assets |
$ |
73,778 |
|
|
$ |
82,144 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts
payable |
$ |
1,273 |
|
|
$ |
1,597 |
|
Accrued
expense and other current liabilities |
4,703 |
|
|
5,292 |
|
Litigation
settlement payable |
5,100 |
|
|
25,000 |
|
Fair value
of warrants potentially settleable in cash |
9,264 |
|
|
14,518 |
|
Current
portion of long-term debt |
23,157 |
|
|
4,739 |
|
Current
liabilities of discontinued operations |
3,727 |
|
|
5,925 |
|
Total
current liabilities |
47,224 |
|
|
57,071 |
|
Deferred tax liability,
non-current |
5,418 |
|
|
5,418 |
|
Contingent purchase price
consideration, net of current portion |
815 |
|
|
6,142 |
|
Total
liabilities |
53,457 |
|
|
68,631 |
|
Stockholders’ equity |
20,321 |
|
|
13,513 |
|
Total liabilities and
stockholders’ equity |
$ |
73,778 |
|
|
$ |
82,144 |
|
|
|
|
|
|
|
|
|
About Galena Biopharma
Galena Biopharma, Inc. is a biopharmaceutical company committed
to the development and commercialization of hematology and oncology
therapeutics that address unmet medical needs. Galena’s pipeline
consists of multiple mid-to-late-stage clinical assets led by our
hematology asset, GALE-401, and our novel cancer immunotherapy
programs including NeuVax™ (nelipepimut-S) and GALE-301/GALE-302.
For more information, visit www.galenabiopharma.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Such statements include, but are not limited to,
statements about development of our products, our future financial
condition and results of operations and potential for
profitability, the sufficiency of our cash resources, our ability
to obtain additional equity or debt financing, possible partnering
or other strategic opportunities for the development of our
products, as well as other statements related to the progress and
timing of our product commercialization and development activities,
present or future licensing, collaborative or financing
arrangements or that otherwise relate to future periods. These
forward-looking statements are subject to a number of risks,
uncertainties and assumptions, including those identified under
“Risk Factors” in Galena’s Annual Report on Form 10-K for the year
ended December 31, 2015 and most recent Quarterly Reports on Form
10-Q filed with the SEC. Actual results may differ materially
from those contemplated by these forward-looking statements. Galena
does not undertake to update any of these forward-looking
statements to reflect a change in its views or events or
circumstances that occur after the date of this press release.
NeuVax is a trademark of Galena Biopharma, Inc.
Contact:
Remy Bernarda
SVP, Investor Relations & Corporate Communications
(925) 498-7709
ir@galenabiopharma.com
SELLAS Life Sciences (NASDAQ:SLS)
Historical Stock Chart
From Aug 2024 to Sep 2024
SELLAS Life Sciences (NASDAQ:SLS)
Historical Stock Chart
From Sep 2023 to Sep 2024