-- Avid Achieves Year-Over-Year Topline Revenue
Growth of 30% Exceeding $57 Million --
Peregrine Pharmaceuticals, Inc. (NASDAQ:PPHM) (NASDAQ:PPHMP), a
biopharmaceutical company committed to improving patient lives by
manufacturing high quality products for biotechnology and
pharmaceutical companies, and advancing its proprietary R&D
pipeline, today announced financial results for the fourth quarter
and fiscal year (FY) ended April 30, 2017, and provided an update
on its contract manufacturing operations, research and development
programs, and other corporate highlights.
Highlights Since January 31,
2017“We are very pleased to announce that the business
recorded its highest annual revenue to date during fiscal 2017,”
stated Steven W. King, president and chief executive officer
of Peregrine, and president of Avid Bioservices. “While we
are happy to report continued year-over-year revenue growth, we are
projecting revenues for FY 2018 to be similar with FY 2017 due to
recent changes in the forecast of a large customer and a delayed
regulatory filing for another customer. We believe this is a
temporary lull and remain confident that Avid is in a strong
position for continued growth in the future.” Mr. King
continued, “An important part of continuing revenue growth and
reducing risk for the business is to attract new customers.
On that front, we have recently signed four new customers that we
expect to contribute to top-line revenue in FY 2018 and into the
future. In addition, we successfully completed three process
validation campaigns this fiscal year for existing third-party
customers which we believe may significantly contribute to future
revenue as these customers move toward building inventory for their
potential launch, and commercial supply.
“We are also continuing to take other important
steps to ensure Avid’s growth in the coming years. As part of
this effort, we have recently installed two new 2,000 liter
bioreactors in our Myford facility, and we already have commitments
for part of this capacity. Due to its state-of-the-art and
modular design, there remains potential to install additional
bioreactors in Myford, which will allow us to continue growing the
business within our current facilities.
“Turning to the Peregrine business, we were able
to generate some of the most compelling bavituximab data to date,
further supporting the combination of bavituximab and checkpoint
inhibitors even while reducing R&D spending by over 50% in FY
2017. The clinical findings came from the comprehensive
analysis of maturing Phase III SUNRISE data while impressive
preclinical results came from our collaborators at Memorial Sloan
Kettering Cancer Center (MSKCC). The researchers at MSKCC presented
promising preclinical data combining PS-targeting with adoptive T
cell transfer therapy which may support the combination of
bavituximab with CAR-T cell immunotherapy in the future.
“Both Peregrine and Avid have achieved important
milestones in recent quarters. The success of Avid and its
continued revenue growth with the compelling data we have seen from
the Phase III SUNRISE trial have led us to explore various
strategic options that we believe will enable us to enhance
stockholder value for all stockholders, including the possible
separation of these two distinct businesses.”
Research and Development
Highlights"The most compelling data to date from the Phase
III SUNRISE trial was presented at AACR and together with the PD-L1
results presented at ASCO this year add to the growing body of data
supporting the further development of bavituximab with checkpoint
inhibitors," said Joseph Shan, vice president of clinical and
regulatory affairs at Peregrine.
AACR Highlights: In a subgroup analysis,
Peregrine researchers looked at the outcome of 91 patients that
were enrolled in the Phase III SUNRISE trial that were subsequently
treated with anti-PD-1/PD-L1 immune checkpoint inhibitors (“ICI’s”)
post study treatments. The results from this analysis
demonstrated that the patients who received docetaxel plus
bavituximab (Doc+Bavi) and subsequent ICI had not yet reached
median overall survival (“mOS”) compared to mOS of 13.0 months for
patients who received docetaxel plus placebo (Doc+Placebo) (hazard
ratio [HR], 0.43; p=0.005). The statistically significant
difference between the two arms in the trial provides strong
rationale for combining bavituximab with ICI’s and supports the
hypothesis that bavituximab may modulate the tumor microenvironment
to enhance the anti-tumor activity of ICI’s.
A photo accompanying this announcement is available at
http://www.globenewswire.com/NewsRoom/AttachmentNg/428c1a61-a599-4976-8a92-d65148671bcd
ASCO Highlights:Peregrine researchers presented
additional supportive data demonstrating that patients in the
bavituximab containing arm who had low baseline PD-L1 expression on
tumor cells (i.e., patients typically with poorer response to
PD-1/PD-L1 checkpoint inhibitors) lived significantly longer than
patients with high baseline PD-L1 expression. These data
further support the hypothesis that bavituximab may modulate the
tumor microenvironment to complement and enhance the anti-tumor
activity of ICI’s.
NCCN Highlights:The three clinical trials under
the collaboration with the NCCN are advancing as planned.
- Massachusetts General Hospital Cancer Center—Phase I/II
Clinical Trial of Bavituximab with Radiation and Temozolomide for
Patients with Newly Diagnosed Glioblastoma. This trial is
open for enrollment.
- Moffitt Cancer Center—A Phase I Trial of Sorafenib and
Bavituximab Plus Stereotactic Body Radiation Therapy for
Unresectable Hepatitis C Associated Hepatocellular Carcinoma.
This trial is open for enrollment.
- The Sidney Kimmel Comprehensive Cancer Center at Johns
Hopkins—Phase II Study of Pembrolizumab and Bavituximab for
Progressive Recurrent/Metastatic Squamous Cell Carcinoma of the
Head and Neck. This trial is expected to be initiated by the
end of the calendar year 2017.
Preclinical Highlights:Researchers from Memorial
Sloan Kettering Cancer Center (MSKCC) presented a preclinical study
evaluating the anti-tumor activity and toxicities of adoptive T
cell transfer therapy in combination with either PS-targeting
antibodies or anti-OX40 antibodies in mice with advanced
melanomas. Whereas PS-targeting and anti-OX40 demonstrated
comparable tumor regression when administered in combination with
transferred adoptive T cells, only the PS-targeting combination
achieved these results without any off-target toxicities. In
contrast, the anti-OX40 treatment combination triggered off-target
side effects.
PS Exosome Technology Highlights:The company
continues to make progress with its PS exosome diagnostic
technology that is designed to detect and monitor cancer. The
assay has been successfully optimized and we are currently
preparing to generate additional data by testing human
samples. Such data will be important to partnering
discussions.
Avid Bioservices Highlights"FY
2017 was a strong year for Avid Bioservices with year-over-year
revenue growth of 30% compared to FY 2016. The company
recognized revenue of $17.9 million for the fourth quarter and
$57.6 million for the full fiscal year,” stated Paul Lytle, chief
financial officer of Peregrine. "While we missed our revenue
guidance of $60 to $65 million, we were ready to ship a number of
process validation runs which were delayed due to events outside
our control. This delay has caused approximately $10 million
in manufacturing revenue to shift from fiscal year 2017 to fiscal
year 2018.”
- The company is providing manufacturing revenue guidance for the
full FY 2018 of $50 million - $55 million.
- Avid's current manufacturing revenue backlog is $58 million,
representing estimated future manufacturing revenue to be
recognized under committed contracts. Most of the backlog is
expected to be recognized during FY 2018.
Financial Highlights and
Results
- During the fourth quarter of FY 2017, we recorded total
revenues of $17,904,000 as compared to $18,783,000 in the fourth
quarter of the prior FY. For FY 2017, we achieved total
revenues of $57,630,000 as compared to $44,686,000 for FY
2016. This represents total revenue growth of 29% for FY 2017
compared to the same prior year period.
- Contract manufacturing revenue from Avid's clinical and
commercial biomanufacturing services was $17,904,000 for the fourth
quarter of FY 2017 compared to $18,783,000 for the fourth
quarter of FY 2016. For the year, revenue increased 30%
to $57,630,000 for FY 2017 compared
to $44,357,000 for FY 2016. The fiscal year increase was
primarily attributed to an increase in demand for contract
manufacturing services associated with process validation
activities. Current committed manufacturing backlog for Avid is
approximately $58 million, covering services to be provided
during FY 2018 and into FY 2019. Based on this current
backlog, Peregrine expects contract manufacturing revenue for FY
2018 to be between $50 and $55 million.
- Total costs and expenses for the fourth quarter of FY 2017 were
$23,208,000, compared to $30,698,000 for the fourth quarter of FY
2016. For FY 2017, total costs and expenses
were $85,890,000 compared to $101,046,000 for FY
2016. For the fourth quarter of FY 2017, research and
development expenses decreased 59% to $6,717,000, compared to
$16,265,000 for the fourth quarter of FY 2016. For FY 2017,
research and development expenses decreased 52% to $28,297,000
compared to $59,529,000 for FY 2016.
- Cost of contract manufacturing increased to $11,782,000 in the
fourth quarter of FY 2017 compared to $9,721,000 for the fourth
quarter of FY 2016, and to $38,259,000 for the full FY 2017 as
compared to $22,966,000 for the full FY 2016. These increases
are primarily due to an increase in the cost of contract
manufacturing associated with higher reported revenue. Also
contributing to this increase and impacting gross margins for the
period is the higher overhead cost of operating the new Myford
facility as well as higher labor cost associated with performing
process validation runs combined with lower utilization of
available capacity. For the fourth quarter of FY 2017,
selling, general and administrative expenses decreased slightly to
$4,709,000 compared to $4,712,000 for FY 2016. For FY 2017
selling, general and administrative expenses increased to
$19,334,000 compared to $18,551,000 for FY 2016.
The full-year increase is primarily due to the company's growing
manufacturing business.
- Peregrine's consolidated net loss attributable to common
stockholders was $6,714,000 or $0.16 per share, for the fourth
quarter of FY 2017, compared to a net loss attributable to common
stockholders of $13,264,000, or $0.40 per share, for the same prior
year quarter. For FY 2017, net loss attributable to
common stockholders was $32,799,000, or $0.88 per
share, compared to $60,136,000, or $1.95 per share,
for FY 2016.
- Peregrine reported $46,799,000 in cash and cash equivalents as
of April 30, 2017, compared to $61,412,000 at fiscal year ended
April 30, 2016.
More detailed financial information and analysis
may be found in Peregrine's Annual Report on Form 10-K, which will
be filed with the Securities and Exchange Commission today.
Conference CallPeregrine will
host a conference call and webcast this afternoon, July 14, 2017,
at 4:30 PM EDT (1:30 PM PDT).
To listen to the conference call, please dial
(877) 312-5443 or (253) 237-1126 and request the Peregrine
Pharmaceuticals conference call. To listen to the live webcast, or
access the archived webcast, please visit:
http://ir.peregrineinc.com/events.cfm.
About Peregrine Pharmaceuticals,
Inc.Peregrine Pharmaceuticals, Inc. is a biopharmaceutical
company committed to improving the lives of patients by delivering
high quality pharmaceutical products through its contract
development and manufacturing organization (CDMO) services and
through advancing and licensing its investigational immunotherapy
and related products. Peregrine's in-house CDMO services,
including cGMP manufacturing and development capabilities, are
provided through its wholly-owned subsidiary Avid Bioservices, Inc.
(www.avidbio.com), which provides development and biomanufacturing
services for both Peregrine and third-party customers. The
company is also working to evaluate its lead immunotherapy
candidate, bavituximab, in combination with immune stimulating
therapies for the treatment of various cancers, and developing its
proprietary exosome technology for the detection and monitoring of
cancer. For more information, please visit
www.peregrineinc.com.
About Avid BioservicesAvid
Bioservices provides a comprehensive range of process development,
high quality cGMP clinical and commercial manufacturing services
for the biotechnology and biopharmaceutical industries. With over
15 years of experience producing monoclonal antibodies and
recombinant proteins in batch, fed-batch and perfusion modes,
Avid's services include cGMP clinical and commercial product
manufacturing, purification, bulk packaging, stability testing and
regulatory strategy, submission and support. The company also
provides a variety of process development activities, including
cell line development and optimization, cell culture and feed
optimization, analytical methods development and product
characterization. For more information about Avid, please visit
www.avidbio.com.
Safe Harbor Statement:
Statements in this press release which are not purely historical,
including statements regarding Peregrine Pharmaceuticals'
intentions, hopes, beliefs, expectations, representations,
projections, plans or predictions of the future are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. The forward-looking statements involve risks
and uncertainties including, but not limited to, the risk that a
future clinical trial combining bavituximab with an immune
checkpoint inhibitor my not generate statistically significant
data, data consistent with the data presented at AACR
regarding SUNRISE patients who were treated with bavituximab and
subsequently treated with immune checkpoint inhibitors or data
supporting the theory that bavituximab modulates the tumor
microenvironment to complement and enhance anti-tumor activity of
immune checkpoint inhibitors, the risk that one or more of the NCCN
grant funded investigator-initiated clinical studies may
experience enrollment delays, the risk that data from one or
more of the NCCN grant funded investigator-initiated clinical
studies does not support further evaluation, the risk that the
results from the pre-clinical studies are not replicated in human
clinical trials, the risk that the company may not have or raise
adequate financial resources from debt and/or equity financings
and/or Avid's manufacturing operations to enable it to continue as
a going concern, or to fund the further development of bavituximab
or further development of PS exosome diagnostic technology, the
risk that data from further testing of the PS exosome diagnostic
with human samples will not support further development,
commercialization or contemplated partnering discussions, the risk
that Avid's revenue growth may slow or decline, the risk that the
company does not achieve profitability, the risk that Avid may
experience technical difficulties in processing customer orders
which could delay delivery of products to customers, revenue
recognition and receipt of payment, the risk that one or more
existing Avid customers terminates its contract prior to completion
or reduces or delays its demand for manufacturing services, and the
risk that commencement of construction of the new manufacturing
facility will be delayed indefinitely due to a lack of customer
demand and/or inability to raise the capital to construct the
facility. The company's actual results could differ
materially from those in any such forward-looking statements.
Factors that could cause actual results to differ materially
include, but are not limited to, uncertainties associated with
completing preclinical and clinical trials for our technologies;
the early stage of product development; the significant costs to
develop our products as all of our products are currently in
development, preclinical studies or clinical trials; obtaining
additional financing to support our operations and the development
of our products; obtaining regulatory approval for our
technologies; anticipated timing of regulatory filings and the
potential success in gaining regulatory approval and complying with
governmental regulations applicable to our business. Our business
could be affected by a number of other factors, including the risk
factors listed from time to time in our reports filed with the
Securities and Exchange Commission including, but not limited to,
our annual report on Form 10-K for the fiscal year ended April 30,
2017 as well as any updates to these risk factors filed from time
to time in the company's other filings with the Securities and
Exchange Commission. The company cautions investors not to place
undue reliance on the forward-looking statements contained in this
press release. Peregrine Pharmaceuticals, Inc. disclaims any
obligation, and does not undertake to update or revise any
forward-looking statements in this press release.
|
PEREGRINE PHARMACEUTICALS, INC. |
CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE
LOSS |
|
|
THREE MONTHS ENDEDAPRIL
30, |
|
TWELVE MONTHS ENDEDAPRIL
30, |
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
Unaudited |
|
Unaudited |
|
|
|
|
REVENUES: |
|
|
|
|
|
|
|
Contract manufacturing
revenue |
$ |
17,904,000 |
|
|
$ |
18,783,000 |
|
|
$ |
57,630,000 |
|
|
$ |
44,357,000 |
|
License revenue |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
329,000 |
|
Total
revenues |
|
17,904,000 |
|
|
|
18,783,000 |
|
|
|
57,630,000 |
|
|
|
44,686,000 |
|
|
|
|
|
|
|
|
|
COSTS AND
EXPENSES: |
|
|
|
|
|
|
|
Cost of contract
manufacturing |
|
11,782,000 |
|
|
|
9,721,000 |
|
|
|
38,259,000 |
|
|
|
22,966,000 |
|
Research and
development |
|
6,717,000 |
|
|
|
16,265,000 |
|
|
|
28,297,000 |
|
|
|
59,529,000 |
|
Selling, general and
administrative |
|
4,709,000 |
|
|
|
4,712,000 |
|
|
|
19,334,000 |
|
|
|
18,551,000 |
|
Total
costs and expenses |
|
23,208,000 |
|
|
|
30,698,000 |
|
|
|
85,890,000 |
|
|
|
101,046,000 |
|
|
|
|
|
|
|
|
|
LOSS FROM
OPERATIONS |
|
(5,304,000 |
) |
|
|
(11,915,000 |
) |
|
|
(28,260,000 |
) |
|
|
(56,360,000 |
) |
|
|
|
|
|
|
|
|
OTHER INCOME
(EXPENSE): |
|
|
|
|
|
|
|
Interest and other
income |
|
37,000 |
|
|
|
31,000 |
|
|
|
108,000 |
|
|
|
722,000 |
|
Interest and other
expense |
|
(5,000 |
) |
|
|
— |
|
|
|
(7,000 |
) |
|
|
(14,000 |
) |
NET
LOSS |
$ |
(5,272,000 |
) |
|
$ |
(11,884,000 |
) |
|
$ |
(28,159,000 |
) |
|
$ |
(55,652,000 |
) |
|
|
|
|
|
|
|
|
COMPREHENSIVE LOSS |
$ |
(5,272,000 |
) |
|
$ |
(11,884,000 |
) |
|
$ |
(28,159,000 |
) |
|
$ |
(55,652,000 |
) |
|
|
|
|
|
|
|
|
Series E preferred
stock accumulated dividends |
|
(1,442,000 |
) |
|
|
(1,380,000 |
) |
|
|
(4,640,000 |
) |
|
|
(4,484,000 |
) |
|
|
|
|
|
|
|
|
NET LOSS
ATTRIBUTABLE TO COMMON STOCKHOLDERS |
$ |
(6,714,000 |
) |
|
$ |
(13,264,000 |
) |
|
$ |
(32,799,000 |
) |
|
$ |
(60,136,000 |
) |
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING: |
|
|
|
|
|
|
|
Basic and
Diluted (1) |
|
42,141,720 |
|
|
|
33,478,863 |
|
|
37,109,493 |
|
|
|
30,895,089 |
|
|
|
|
|
|
|
|
|
BASIC AND DILUTED LOSS
PER COMMON SHARE (1) |
$ |
(0.16 |
) |
|
$ |
(0.40 |
) |
|
$ |
(0.88 |
) |
|
$ |
(1.95 |
) |
(1) All share and per share amounts
of our common stock issued and outstanding for all periods have
been retroactively adjusted to reflect the one-for-seven reverse
stock split which took effect with the opening of trading on July
10, 2017.
PEREGRINE PHARMACEUTICALS, INC. |
|
CONSOLIDATED BALANCE SHEETS |
AS
OF APRIL 30, 2017 AND 2016 |
|
|
2017 |
|
2016 |
ASSETS |
|
|
|
CURRENT ASSETS: |
|
|
|
Cash and cash
equivalents |
$ |
46,799,000 |
|
|
$ |
61,412,000 |
|
Trade and other
receivables |
|
7,742,000 |
|
|
|
2,859,000 |
|
Inventories |
|
33,099,000 |
|
|
|
16,186,000 |
|
Prepaid expenses |
|
1,460,000 |
|
|
|
1,351,000 |
|
|
|
|
|
Total current assets |
|
89,100,000 |
|
|
|
81,808,000 |
|
|
|
|
|
PROPERTY AND EQUIPMENT: |
|
|
|
Leasehold improvements |
|
20,098,000 |
|
|
|
19,610,000 |
|
Laboratory equipment |
|
10,777,000 |
|
|
|
10,257,000 |
|
Furniture, fixtures, office equipment and software |
|
4,499,000 |
|
|
|
4,045,000 |
|
|
|
|
|
|
|
|
|
|
|
35,374,000 |
|
|
|
33,912,000 |
|
Less
accumulated depreciation and amortization |
|
(11,700,000 |
) |
|
|
(9,610,000 |
) |
|
|
|
|
Property and equipment, net |
|
23,674,000 |
|
|
|
24,302,000 |
|
|
|
|
|
Restricted cash |
|
1,150,000 |
|
|
|
600,000 |
|
Other
assets |
|
4,188,000 |
|
|
|
2,333,000 |
|
|
|
|
|
TOTAL ASSETS |
$ |
118,112,000 |
|
|
$ |
109,043,000 |
|
|
PEREGRINE PHARMACEUTICALS, INC. |
|
CONSOLIDATED BALANCE SHEETS |
AS
OF APRIL 30, 2017 AND 2016 (continued) |
|
|
2017 |
|
2016 |
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
CURRENT
LIABILITIES: |
|
|
|
Accounts payable |
$ |
5,779,000 |
|
|
$ |
8,429,000 |
|
Accrued clinical trial
and related fees |
|
4,558,000 |
|
|
|
7,594,000 |
|
Accrued payroll and
related costs |
|
6,084,000 |
|
|
|
5,821,000 |
|
Deferred revenue |
|
28,500,000 |
|
|
|
10,030,000 |
|
Customer deposits |
|
17,017,000 |
|
|
|
24,212,000 |
|
Other current
liabilities |
|
993,000 |
|
|
|
1,488,000 |
|
Total current liabilities |
|
62,931,000 |
|
|
|
57,574,000 |
|
|
|
|
|
Deferred rent, less current portion |
|
1,599,000 |
|
|
|
1,395,000 |
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY
(1): |
|
|
|
Preferred stock - $.001
par value; authorized 5,000,000 shares;issued and outstanding -
1,647,760 and 1,577,440, respectively |
|
2,000 |
|
|
|
2,000 |
|
Common stock - $.001
par value; authorized 500,000,000shares; issued and outstanding -
44,014,040 and 33,847,213,respectively |
|
44,000 |
|
|
|
34,000 |
|
Additional
paid-in-capital |
|
590,971,000 |
|
|
|
559,314,000 |
|
Accumulated
deficit |
|
(537,435,000 |
) |
|
|
(509,276,000 |
) |
|
|
|
|
Total stockholders' equity |
|
53,582,000 |
|
|
|
50,074,000 |
|
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY |
$ |
118,112,000 |
|
|
$ |
109,043,000 |
|
|
|
|
|
(1) All share and per share
amounts of our common stock issued and outstanding for all periods
have been retroactively adjusted to reflect the one-for-seven
reverse stock split which took effect with the opening of trading
on July 10, 2017.
The photo is also available at Newscom,
www.newscom.com, and via AP PhotoExpress.
Contacts:
Stephanie Diaz (Investors)
Vida Strategic Partners
415-675-7401
sdiaz@vidasp.com
Tim Brons (Media)
Vida Strategic Partners
415-675-7402
tbrons@vidasp.com
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