WARRINGTON, Pa., March 31, 2017 /PRNewswire/ -- Windtree
Therapeutics, Inc. (Nasdaq: WINT), a biotechnology company focused
on developing aerosolized KL4 surfactant therapies for respiratory
diseases, today reported financial results for the fourth quarter
ended December 31, 2016 and provided
key business updates.
Key Business and Financial Updates
- Enrollment in the AEROSURF® phase 2b clinical trial in up to
240 premature infants 28 to 32 week gestational age for respiratory
distress syndrome (RDS) is progressing and the Company reaffirms
its plan to announce top-line results from this study in mid-year
2017.
- Enrollment in the third dose group of the AEROSURF phase 2a
clinical trial in 48 premature infants 26 to 28 week gestational
age for RDS is progressing. This study is designed to evaluate
safety and tolerability of AEROSURF. Due to a lower number of
premature infants who are eligible for enrollment in this age
range, enrollment has required additional time and the
Company now expects to complete enrollment and announce
top-line results in mid-second quarter of 2017.
- The Company previously reported positive results from two NIH
funded preclinical studies evaluating (i) KL4 surfactant as a
possible countermeasure to mitigate acute and chronic/late-phase
radiation induced lung injury; and, (ii) as a potential medical
intervention to reduce morbidity and mortality associated with both
seasonal and pandemic influenza pneumonia.
- As of December 31, 2016, the
Company had cash and cash equivalents of $5.6 million. In February
2017, the Company completed a private placement offering of
7,049 Series A Convertible Preferred Stock units for net proceeds
of approximately $10.5 million,
including $1.6 million of non-cash
consideration in the form of a reduction in amounts due for current
development services that otherwise would have become payable in
cash in the first and second quarters of 2017.
- The Company anticipates that, before any additional financings,
its currently existing cash resources are sufficient to fund its
operations through the planned completion of the AEROSURF phase 2b
clinical trial and announcement of results in mid-year 2017.
"The fourth quarter of 2016 was one of meaningful progress for
Windtree and our AEROSURF phase 2 program," commented Craig Fraser, President and Chief Executive
Officer. "The expansion of our phase 2b clinical trial to select
sites in Europe and Latin America resulted in an increased rate of
patient screening and enrollments. We have enrolled patients from
all regions and active sites and are on track with previously
stated guidance to release top-line data by mid-year 2017. In
addition, with the successful completion of the $10.5 million private placement in February, we
have met our previously stated goal of securing the additional
capital necessary to adequately fund our operations through
announcement of top line phase 2b data."
Select Financial Results for the Fourth Quarter ended
December 31, 2016
For the quarter ended December 31,
2016, the Company reported an operating loss of $6.4 million, compared to $9.8 million for the fourth quarter of 2015.
Grant revenue for the fourth quarter of 2016 was $0.9 million compared to $0.7 million for the fourth quarter of 2015.
Grant revenue for 2016 primarily represents funds received and
expended under Small Business Innovation Research (SBIR) Grants
from the National Institutes of Health (NIH) to study the Company's
aerosolized KL4 surfactant as (i) a medical countermeasure to
mitigate acute and chronic/late-phase radiation-induced lung
injury; and, (ii) to provide support for the AEROSURF phase 2b
clinical trial in premature infants 28 to 32 week gestational age
with RDS. The 2015 grant revenue was from a SBIR Grant from the NIH
to study the Company's aerosolized KL4 surfactant as a medical
countermeasure to mitigate acute and chronic/late-phase
radiation-induced lung injury.
Research and development expenses were $5.9 million for the fourth quarter of 2016,
compared to $8.2 million for the
fourth quarter of 2015. The decrease was due to reductions in (i)
development costs under the Battelle collaboration agreement for
the next generation aerosol delivery system for use in our
remaining AEROSURF development activities and, if approved, initial
commercial activities; and, (ii) the technology transfer of
our lyophilized surfactant manufacturing process to a new facility
at our CMO to conserve our cash resources and better align the
manufacture of our clinical drug supply with our expected revised
clinical time lines.
Selling, general and administrative expenses for the fourth
quarter of 2016 were $1.3 million,
compared to $2.2 million for the
fourth quarter of 2015. The decrease was primarily due to cost
reduction initiative initiated in the second quarter of 2016 as we
focus our limited resources on advancing the AEROSURF clinical
development program.
Interest expense for the fourth quarter of 2016 and 2015 was
$0.6 million.
The Company reported a net loss of $6.6
million ($0.77 per basic
share) on 8.5 million weighted-average common shares outstanding
for the quarter ended December 31,
2016, compared to a net loss of $10.1
million ($1.26 per basic
share) on 8.1 million weighted average common shares outstanding
for the comparable period in 2015.
Net cash outflows before financing activities for the fourth
quarter of 2016 were $6.9 million.
As of December 31, 2016, the
Company had cash and cash equivalents of $5.6 million. In February 2017, the Company completed a private
placement offering which generated net proceeds of approximately
$10.5 million, including $1.6 million of non-cash consideration in the
form of a reduction in amounts due for current development services
that otherwise would have become payable in cash in the first and
second quarters of 2017. In addition, from January 1, 2017 through March 23, 2017, we completed registered offerings
under our at-the-market equity sales program resulting in net
proceeds to us of $0.9 million.
Based on current projections and development timelines, the Company
anticipates that it has sufficient cash to support its operations
through the planned completion of the AEROSURF phase 2b clinical
trial and the release of top line results, which is expected in
mid-year 2017.
In addition, as of December 31,
2016, the Company reported current liabilities of
$13.4 million and long-term debt of
$25 million. The debt is payable in
two equal installments of $12.5
million in each of February
2018 and 2019. The payment due in February 2018 may be deferred if certain
conditions are satisfied.
Readers are referred to, and encouraged to read in its entirety,
the Company's Annual Report on Form 10-K for the year ended
December 31, 2016 which is expected
to be filed with the Securities and Exchange Commission on
March 31, 2017, which includes
discussion about the Company's business plans and operations,
financial condition and results of operations.
About AEROSURF®
Windtree's lead product candidate is
AEROSURF®, a novel, investigational drug/device combination product
that combines the Company's proprietary KL4 surfactant and
aerosolization technologies. AEROSURF is being developed to
potentially reduce or eliminate the need for endotracheal
intubation and mechanical ventilation in the treatment of premature
infants with respiratory distress syndrome (RDS). Enrollment
is ongoing in a phase 2b clinical trial in up to 240 premature
infants 28 to 32-week gestational age receiving nasal continuous
positive airway pressure (nCPAP) for RDS, comparing AEROSURF to
infants receiving nCPAP alone. The phase 2b trial is a global
trial with clinical sites in North
America, Europe and
Latin America.
About Windtree Therapeutics
Windtree Therapeutics,
Inc. is a clinical-stage biotechnology company focused on
developing novel surfactant therapies for respiratory diseases and
other potential applications. Windtree's proprietary technology
platform includes a synthetic, peptide-containing surfactant (KL4
surfactant) that is structurally similar to endogenous pulmonary
surfactant and novel drug-delivery technologies being developed to
enable noninvasive administration of aerosolized KL4 surfactant.
Windtree is focused initially on improving the management of
respiratory distress syndrome (RDS) in premature infants and
believes that its proprietary technology may make it possible, over
time, to develop a pipeline of KL4 surfactant product candidates to
address a variety of respiratory diseases for which there are few
or no approved therapies.
For more information, please visit the Company's website at
www.windtreetx.com.
Forward-Looking Statements
To the extent that
statements in this press release are not strictly historical, all
such statements are forward-looking, and are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. These forward-looking statements are subject to
certain risks and uncertainties that could cause actual results,
including projections of future cash balances and anticipated cash
outflows, to differ materially from the statements made.
Examples of such risks and uncertainties include: the risk that, as
a development company, with limited resources and no operating
revenues, the Company's ability to continue as a going concern in
the near term is highly dependent upon the successful completion of
the AEROSURF phase 2b clinical trial in mid-2017 and obtaining
results sufficient to support a strategic or financing transaction;
risks that Windtree will be unable to secure significant additional
capital as needed, and may be unable in a timely manner, if at all,
to identify potential strategic transactions (including strategic
partnerships and other transactions) that would provide funding and
support product development, regulatory and, if approved,
commercialize our products, or to access debt or equity financings,
which could result in substantial equity dilution; risks related to
Windtree's AEROSURF development program and other development
programs in the future, which may involve time-consuming and
expensive pre-clinical studies and clinical trials and which may be
subject to potentially significant delays or regulatory holds, or
fail; risks related to the Company's receipt of a deficiency
notification from The NASDAQ Stock Market concerning its failure to
comply with The Nasdaq Capital Market listing requirements and the
Company's ability to regain compliance in a timely manner, if at
all; risks related to technology transfers to contract
manufacturers and problems or delays encountered by Windtree,
contract manufacturers or suppliers in manufacturing drug products,
drug substances, aerosol delivery systems (ADS) and other materials
on a timely basis and in sufficient amounts; risks relating to
rigorous regulatory requirements, including that: (i) the FDA or
other regulatory authorities may not agree with Windtree on matters
raised during regulatory reviews, may require significant
additional activities, or may not accept or may withhold or delay
consideration of applications, or may not approve or may limit
approval of Windtree's products,
and (ii) changes in the national or
international political and regulatory environment may make it more
difficult to gain regulatory approvals; risks related to Windtree's
efforts to maintain and protect the patents and licenses related to
its products; and other risks and uncertainties described in
Windtree's filings with the Securities and Exchange Commission
including the most recent reports on Forms 10-K, 10-Q and 8-K, and
any amendments thereto.
Windtree
Therapeutics, Inc.
|
Condensed
Consolidated Statement of Operations
|
(in thousands, except
per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Product
sales
|
$
–
|
|
$
–
|
|
$
–
|
|
$
7
|
|
Grant
revenue
|
900
|
|
655
|
|
2,042
|
|
980
|
|
|
|
900
|
|
655
|
|
2,042
|
|
987
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
(1)
|
|
|
|
|
|
|
|
|
Cost of product
sales
|
–
|
|
–
|
|
–
|
|
929
|
|
Research and
development
|
5,948
|
|
8,225
|
|
31,705
|
|
28,888
|
|
Selling, general and
administrative
|
1,320
|
|
2,211
|
|
8,373
|
|
11,004
|
|
|
Total
expenses
|
7,268
|
|
10,436
|
|
40,078
|
|
40,821
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
(6,368)
|
|
(9,781)
|
|
(38,036)
|
|
(39,834)
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value
of common stock warrant
|
|
|
|
|
|
|
|
|
liability
(1)
|
–
|
|
274
|
|
223
|
|
851
|
|
Loss on debt
extinguishment
|
–
|
|
–
|
|
–
|
|
(11,758)
|
|
Interest income /
(expense), net
|
(608)
|
|
(604)
|
|
(2,500)
|
|
(4,579)
|
|
Other income /
(expense), net
|
374
|
|
2
|
|
823
|
|
150
|
Net loss
|
$
(6,602)
|
|
$
(10,109)
|
|
$
(39,490)
|
|
$
(55,170)
|
|
|
|
|
|
|
|
|
Net loss per common
share – basic and diluted
|
$
(0.77)
|
|
$
(1.26)
|
|
$
(4.74)
|
|
$
(7.98)
|
|
|
|
|
|
|
|
|
Weighted avg. common
shares outstanding – basic and diluted
|
8,523
|
|
8,050
|
|
8,328
|
|
6,967
|
|
|
|
|
|
|
|
|
|
|
(1)
Material non-cash items include the change in fair
value of certain outstanding warrants accounted for as derivative
liabilities, and in operating expenses, depreciation and
stock-based compensation. For the three months ended December
31, 2016 and 2015, the charges for depreciation and stock-based
compensation were $0.4 million ($0.2 million in R&D and $0.2
million in S, G & A) and $0.4 million ($0.2 million in R&D
and $0.2 million in S, G & A), respectively. For the twelve
months ended December 31, 2016 and 2015, the charges for
depreciation and stock-based compensation were $1.7 million ($0.9
million in R&D and $0.8 million in S, G & A) and $2.2
million ($1.1 million in R&D and $1.1 million in S, G & A),
respectively.
|
Windtree
Therapeutics, Inc.
|
Condensed
Consolidated Balance Sheets
|
(in
thousands)
|
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
|
|
2016
|
|
2015
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
5,588
|
|
$
38,722
|
|
Prepaid interest,
current portion
|
|
1,094
|
|
1,710
|
|
Prepaid expenses and
other current assets
|
|
512
|
|
362
|
|
|
|
Total current
assets
|
|
7,194
|
|
40,794
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
1,054
|
|
1,039
|
Restricted
cash
|
|
225
|
|
225
|
Prepaid interest,
non-current portion
|
|
1,226
|
|
2,319
|
|
|
Total
Assets
|
|
$
9,699
|
|
$
44,377
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
|
Accounts payable,
collaboration payable and accrued expenses
|
|
$
13,391
|
|
$
10,845
|
|
Common stock warrant
liability
|
|
–
|
|
223
|
|
|
|
Total current
liabilities
|
|
13,391
|
|
11,068
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
25,000
|
|
25,000
|
Other
liabilities
|
|
138
|
|
43
|
Stockholders'
Equity
|
|
(28,830)
|
|
8,266
|
|
|
Total Liabilities and
Stockholders' Equity
|
|
$
9,699
|
|
$
44,377
|
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visit:http://www.prnewswire.com/news-releases/windtree-therapeutics-reports-fourth-quarter-2016-financial-results-and-provides-key-business-updates-300432457.html
SOURCE Windtree Therapeutics, Inc.