Pfenex Inc. (NYSE American: PFNX) is a clinical-stage development
and licensing biotechnology company focused on leveraging its
Pfēnex Expression Technology® to develop and improve protein
therapies for unmet patient needs. Using the patented Pfēnex
Expression Technology platform, Pfenex has created an advanced
pipeline of potential therapeutic equivalents, novel biologics,
vaccine and vaccine components, and biosimilars. Today Pfenex Inc.
reported financial results for the first quarter ended March 31,
2019 and provided a business update.
“We are excited to report that during the first quarter of 2019
our lead program, PF708, continued to advance along our projected
timeline. Importantly, it has the potential to change Pfenex from a
clinical stage biotech company to a company with its first
commercial product. Our PDUFA date of October 7, 2019, combined
with Lilly’s decision not to pursue a lawsuit on our paragraph IV
certification, as well as our progress on commercial initiatives
all support a potential launch as early as the fourth quarter of
2019, subject to FDA approval and other factors. We believe the
market potential for PF708 could be significant as a potential
cost-efficient alternative to Forteo, which had $1.6 billion in
global sales in 2018,” said Eef Schimmelpennink, Chief Executive
Officer of Pfenex.
“Beyond PF708, we are also progressing with our Jazz partnership
and our CRM197 partnerships with Merck and Serum Institute of
India, each of which are closing in on milestone clinical studies
or regulatory decisions. Just like PF708, these programs were
developed using our Pfēnex Expression Technology platform. As PF708
moves toward potential commercial launch, research and development
capacity has started to become available, which we are leveraging
toward new pipeline and partnership opportunities. To lead this
expansion of our research and development efforts, we recently
appointed Dr. Martin Brenner as Chief Scientific Officer. He brings
decades of experience identifying new therapies at some of the
world’s leading pharmaceutical companies. This is an exciting time
for Pfenex, as we harness near- and long-term opportunities to
drive value for our stockholders,” concluded Schimmelpennink.
Business Review and Update
PF708 therapeutic equivalent to Forteo
(teriparatide)
PF708 is being developed as a therapeutic equivalent candidate
to Forteo, which is approved and marketed by Eli Lilly & Co.
(Lilly) for the treatment of osteoporosis in certain patients with
a high risk of fracture and achieved $1.6 billion in global product
sales in 2018.
The new drug application (NDA) for PF708 was accepted by the
U.S. Food and Drug Administration (FDA) for substantive review with
a PDUFA date of October 7, 2019. Pfenex believes that this puts
PF708 on track for a potential commercial launch in the United
States as early as the fourth quarter of 2019, subject to FDA
approval and other factors. Pfenex’s development and licensing
partner for PF708, Alvogen, has assumed responsibility to
manufacture and commercialize PF708 in the United States, assuming
FDA approval, at Alvogen’s own cost and expense. Pfenex and Alvogen
are working together on implementing initial stages of the
commercialization strategy for PF708 in preparation for a U.S.
launch following the PDUFA date.
In February 2019, Pfenex and Alvogen announced expanding their
collaboration to develop and commercialize PF708 to the EU, Middle
East and North Africa (MENA) and the ROW territories (excluding
Mainland China, Hong Kong, Singapore, Malaysia and Thailand). This
collaboration leverages Alvogen’s established international
experience and expertise in regulatory and supply chain activities,
as well as its established network of specialty marketing and sales
pharmaceutical companies in these regions. Subject to applicable
regulatory approvals, PF708 will be commercialized in Europe and
Switzerland by Theramex, a leading global specialty pharmaceutical
company dedicated to Women’s Health, in MENA by SAJA, a Tamer Group
company, and in ROW by Alvogen’s current and/or future
commercialization partners. Pfenex will be eligible to receive
additional upfront and milestone payments of $2.5 million for EU
and MENA and additional potential milestone payments for ROW.
For EU, MENA and ROW, Pfenex may also be eligible to receive a
gross profit split of up to 60% on Alvogen’s gross profit derived
from product sales, depending on geography and cost of goods
sold.
In April 2019, Pfenex announced the expiration of the 45-day
period for Lilly to file a lawsuit under the Hatch-Waxman Act and
stay the approval of PF708 for 30 months. Because Lilly did
not file a lawsuit within this time period, there will be no
30-month litigation stay delaying approval of PF708, and if
approved by the FDA, Pfenex will be able to engage in the
commercial manufacture, use, or sale of PF708.
Jazz Collaboration Agreement
Through its collaboration with Jazz Pharmaceuticals, Pfenex has
completed the process development of PF743, a recombinant
crisantaspase, while the development is ongoing for PF745, a
recombinant crisantaspase with half-life extension technology.
Pfenex expects to be eligible to achieve certain development
milestones under the collaboration agreement in the near
term. Overall, Pfenex has made good progress on both products
and believes its success on these programs further demonstrates the
unique capabilities of Pfenex’s platform technology.
Through March 31, 2019, Pfenex has received approximately $36
million under the Jazz agreement. Under the agreement, Pfenex is
eligible to receive an aggregate total of $224.5 million in
development, regulatory and sales milestone fees, of which $188.5
million is still eligible to be received. Of this $188.5
million, $29.5 million are development milestones, $34.0 million
are regulatory milestones and $125.0 million are sales milestones.
Pfenex may also be eligible to receive tiered royalties on
worldwide sales of any products resulting from the
collaboration.
CRM197
CRM197 is a non-toxic mutant of diphtheria toxin. It is a well
characterized protein and functions as a carrier for
polysaccharides and haptens making them immunogenic. CRM197 is
currently being used by Pfenex’s vaccine development focused
pharmaceutical partners, Merck and the Serum Institute of India
Private Ltd (SIIPL) for such diseases as pneumococcal and
meningitis bacterial infections. Merck is currently using
CRM197 in multiple Phase 3 studies of PVC-15 (V114), its
investigational polyvalent conjugate vaccine for the prevention of
pneumococcal disease. SIIPL is using CRM197 in its pneumococcal
vaccine, Pneumosil, which recently completed a successful Phase 3
program and as of January 2019 is in the World Health Organization
(WHO) pre-qualification marketing process.
Pfenex is eligible to receive tiered royalties based upon net
sales by both Merck and SIIPL. Pfenex also has other
non-disclosed partnerships in various stages of development and
continues to sell non-GMP and cGMP grade CRM197 to vaccine
development-focused pharma partners.
Financial Highlights for the First Quarter
2019
Total Revenue increased by $6.6 million, or
177%, to $10.4 million in the three-month period ended March 31,
2019, compared to $3.7 million in the same period in 2018. The
increase in revenue was primarily due to a milestone payment from
Alvogen and recognition of deferred revenue from NT Pharma upon FDA
acceptance of the NDA for PF708, and increases in sales of Pfenex’s
CRM197 product, partially offset by a decrease in activity related
to its Px563L product candidate under government contract.
Cost of revenue increased by approximately $0.1
million, or 3%, to $1.6 million in the three-month period ended
March 31, 2019, compared to $1.5 million in the same period in
2018. The increase was primarily due to greater sales of Pfenex’s
CRM197 product, offset by lower costs for its Px563L product
candidate under its government contract.
Research and development expenses decreased by
approximately $0.9 million, or 10%, to $7.9 million in the
three-month period ended March 31, 2019, compared to $8.8 million
in same period in 2018. This was primarily due to timing of
expenses related to Pfenex’s lead product candidate PF708.
Significant activity occurred leading up to submission of the NDA
to the FDA, which occurred in December 2018.
Selling, general and administration expenses
increased by $0.1 million, or 3%, to $4.6 million in the
three-month period ended March 31, 2019, compared to $4.5 million
in the same period in 2018.
Cash and cash equivalents As of March 31, 2019,
Pfenex had $45.8 million in cash and cash equivalents. Pfenex
believes that its existing cash and cash equivalents will be
sufficient to meet its anticipated cash needs for at least the next
12 months.
Conference Call Information
The Pfenex management will host a conference call and webcast
today at 4:30 PM Eastern Time. Participants may access the call by
dialing 866-376-8058 (Domestic) or 412-542-4131 (International).
The call will also be webcast and can be accessed from the
Investors section of the Company’s website at www.pfenex.com or
https://www.webcaster4.com/Webcast/Page/1061/30275
A replay of the call will also be available through May
16th. Participants may access the replay of the call by
dialing 877-344-7529 (Domestic) or 412-317-0088 (International) and
providing the conference ID number: 10130782.
About Pfenex Inc.
Pfenex is a clinical-stage development and licensing
biotechnology company focused on leveraging its Pfēnex
Expression Technology® to develop and improve protein
therapies for unmet patient needs. Using the patented Pfēnex
Expression Technology platform, the Company has created an advanced
pipeline of potential therapeutic equivalents, novel biologics,
vaccine and vaccine components, and biosimilars. The Company’s lead
product candidate is PF708, a therapeutic equivalent candidate to
Forteo® (teriparatide) for the treatment of
osteoporosis. In addition, in collaboration with Jazz
Pharmaceuticals Ireland Limited (Jazz) the Company is developing
hematologic oncology products including PF743 a recombinant
crisantaspase and PF745 a recombinant crisantaspase with half-life
extension. Both PF743 and PF745 are being developed for the
treatment of Acute Lymphoblastic Leukemia (ALL). We also use our
Pfēnex Expression Technology platform to produce CRM197, a
diphtheria toxoid carrier protein used in prophylactic and
therapeutic vaccine candidates under development by third
parties.
Cautionary Note Regarding Forward-Looking Statement
–
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements generally relate to future events
or Pfenex's future financial or operating performance. In some
cases, you can identify forward-looking statements because they
contain words such as "may," "will," "should," "expects," "plans,"
"anticipates," "could," "intends," "target," "projects,"
"contemplates," "believes," "estimates," "predicts," "potential" or
"continue" or the negative of these words or other similar terms or
expressions that concern Pfenex's future expectations, strategy,
plans or intentions. Forward-looking statements in this press
release include, but are not limited to, statements regarding the
future potential of Pfenex's product candidates and the company in
general, including future plans to advance, develop, manufacture
and commercialize its product candidates; the size of potential
markets; the possibility of the potential commercial US launch of
PF708 as early as the fourth quarter of 2019; Pfenex’s expectations
with respect to the sufficiency of its cash resources; Pfenex's
expectations regarding the timing and advancement of clinical
trials and studies and the types of future clinical trials and
studies for its product candidates; Pfenex’s expectations that it
will achieve development milestones near-term under its Jazz
Agreement; the potential benefits of use of Pfenex’s product
candidates; Pfenex’s belief that its research and development
expense will fluctuate; Pfenex believes that it has the potential
to change Pfenex from a clinical stage biotech company to a company
with its first commercial product; Pfenex's expectations with
regard to future milestones, royalty payments, and reimbursements
from Pfenex’s collaborations with Jazz Pharmaceuticals, Alvogen,
and its other collaboration partners; and Pfenex's
expectation with respect to its agreement with Merck and SIIPL,
including its potential to receive payments. Pfenex's expectations
and beliefs regarding these matters may not materialize, and actual
results in future periods are subject to risks and uncertainties
that could cause actual results to differ materially from those
projected. Actual results may differ materially from those
indicated by these forward-looking statements as a result of the
uncertainties inherent in the clinical drug development process,
including, without limitation, Pfenex's ability to successfully
demonstrate the efficacy and safety of its product candidates; the
pre-clinical and clinical results for its product candidates, which
may not support further development of product candidates or may
require Pfenex to conduct additional clinical trials or modify
ongoing clinical trials or regulatory pathways; challenges related
to commencement, patient enrollment, completion, and analysis of
clinical trials; difficulties in achieving and demonstrating
biosimilarity in formulations; Pfenex's ability to manage operating
expenses; Pfenex's ability to obtain additional funding to support
its business activities and establish and maintain strategic
business alliances and new business initiatives; Pfenex's
dependence on third parties for development, manufacture,
marketing, sales and distribution of products; unexpected
expenditures; litigation and other proceedings regarding
intellectual property rights; and difficulties in obtaining and
maintaining intellectual property protection for its product
candidates. Information on these and additional risks,
uncertainties, and other information affecting Pfenex's business
and operating results is contained in Pfenex’s Quarterly Report on
Form 10-Q for the quarter ended March 31, 2019 to be
filed with the Securities and Exchange Commission and in its other
filings with the Securities and Exchange Commission. The
forward-looking statements in this press release are based on
information available to Pfenex as of the date hereof, and Pfenex
disclaims any obligation to update any forward-looking statements,
except as required by law.
Pfenex investors and others should note that we announce
material information to the public about the Company through a
variety of means, including our website (http://www.pfenex.com/),
our investor relations website (http://pfenex.investorroom.com/),
press releases, SEC filings, public conference calls, corporate
Twitter account (https://twitter.com/pfenex), Facebook page
(https://www.facebook.com/Pfenex-Inc-105908276167776/timeline/),
and LinkedIn page (https://www.linkedin.com/company/pfenex-inc) in
order to achieve broad, non-exclusionary distribution of
information to the public and to comply with our disclosure
obligations under Regulation FD. We encourage our investors and
others to monitor and review the information we make public in
these locations as such information could be deemed to be material
information. Please note that this list may be updated from time to
time.
Company Contact: Susan A. KnudsonChief
Financial Officer(858) 352-4324sknudson@pfenex.com
PFENEX INC.Consolidated
Statements of Operations
|
|
|
|
|
|
|
|
|
Three Months
EndedMarch 31, |
|
(in thousands, except per
share data) |
2019 |
|
|
2018 |
|
Revenue |
$ |
10,362 |
|
|
$ |
3,746 |
|
Cost of revenue |
|
1,572 |
|
|
|
1,520 |
|
|
|
|
|
|
|
|
|
Gross profit |
|
8,790 |
|
|
|
2,226 |
|
Operating expense |
|
|
|
|
|
|
|
Research and development |
|
7,923 |
|
|
|
8,806 |
|
Selling, general and administrative |
|
4,597 |
|
|
|
4,450 |
|
|
|
|
|
|
|
|
|
Total operating expense |
|
12,520 |
|
|
|
13,256 |
|
|
|
|
|
|
|
|
|
Loss from operations |
|
(3,730 |
) |
|
|
(11,030 |
) |
Other income, net |
|
69 |
|
|
|
3 |
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(3,661 |
) |
|
$ |
(11,027 |
) |
|
|
|
|
|
|
|
|
Net loss per common share: |
|
|
|
|
|
|
|
Basic and diluted |
$ |
(0.12 |
) |
|
$ |
(0.47 |
) |
|
|
|
|
|
|
|
|
Weighted-average common shares used in calculating net
loss per share: |
|
|
|
|
|
|
|
Basic and diluted |
|
31,487 |
|
|
|
23,569 |
|
|
|
|
|
|
|
|
|
PFENEX INC.Consolidated
Balance Sheets
|
|
|
|
|
|
|
|
|
March 31,2019(unaudited) |
|
|
December 31,2018 |
|
|
|
|
|
|
|
|
(in thousands) |
|
Assets |
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
45,754 |
|
|
$ |
56,220 |
|
Restricted cash |
|
200 |
|
|
|
200 |
|
Accounts and unbilled receivables, net |
|
6,460 |
|
|
|
5,171 |
|
Income tax receivable |
|
159 |
|
|
|
207 |
|
Other current assets |
|
2,116 |
|
|
|
1,851 |
|
|
|
|
|
|
|
|
|
Total current assets |
|
54,689 |
|
|
|
63,649 |
|
Property and equipment, net |
|
7,596 |
|
|
|
7,671 |
|
Other long-term assets |
|
170 |
|
|
|
133 |
|
Intangible assets, net |
|
4,115 |
|
|
|
4,248 |
|
Goodwill |
|
5,577 |
|
|
|
5,577 |
|
|
|
|
|
|
|
|
|
Total assets |
$ |
72,147 |
|
|
$ |
81,278 |
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders’
Equity |
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
Accounts payable |
$ |
1,155 |
|
|
$ |
2,005 |
|
Accrued liabilities |
|
8,574 |
|
|
|
9,812 |
|
Current portion of deferred revenue |
|
993 |
|
|
|
5,317 |
|
Current portion of capital lease obligations |
|
321 |
|
|
|
316 |
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
11,043 |
|
|
|
17,450 |
|
Deferred revenue, less current portion |
|
2,500 |
|
|
|
2,500 |
|
Capital lease obligations, less current portion |
|
135 |
|
|
|
191 |
|
|
|
|
|
|
|
|
|
Total liabilities |
|
13,678 |
|
|
|
20,141 |
|
Commitments and contingencies |
|
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
|
|
|
Preferred stock, $0.001 par value, 10,000,000 shares authorized; no
shares issued and outstanding |
|
— |
|
|
|
— |
|
Common stock, par value $0.001, 200,000,000 shares authorized;
31,499,980 and 31,467,580 shares issued and outstanding at
March 31, 2019 and December 31, 2018, respectively |
|
32 |
|
|
|
32 |
|
Additional paid-in capital |
|
263,398 |
|
|
|
262,405 |
|
Accumulated deficit |
|
(204,961 |
) |
|
|
(201,300 |
) |
|
|
|
|
|
|
|
|
Total stockholders’ equity |
|
58,469 |
|
|
|
61,137 |
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders’ equity |
$ |
72,147 |
|
|
$ |
81,278 |
|
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