Fourth quarter progress lays foundation for promising
2016
All amounts are in US Dollars
Fourth quarter key developments
- Capital structure repaired
- Share consolidation successfully
concluded
- Compliance with NASDAQ listing
standards achieved
- $15.4 million of net capital obtained
on favorable terms
- Product development advanced towards
registration
- Zoptrex™ (zoptarelin doxorubicin)
pivotal Phase 3 clinical program received DSMB recommendation to
continue to completion following review of the final interim
efficacy and safety data; completion of trial scheduled for Q3
2016
- Zoptrex™ licensee in China and related
territories, Sinopharm A-Think Pharmaceuticals Co., Ltd., on track
to commence clinical program in H2 2016 and to begin manufacturing
the compound
- Macrilen™ (macimorelin) confirmatory
Phase 3 Trial for the evaluation of AGHD initiates patient
enrollment; completion of trial scheduled for Q3 2016
- Co-Marketing Agreement for
APIFINY® Prostate Cancer Blood Test concluded with
Armune BioScience
- Restructuring of financial team and
closing of the Quebec City office
Aeterna Zentaris Inc. (NASDAQ: AEZS) (TSX: AEZ) (the “Company”),
a specialty biopharmaceutical company engaged in developing and
commercializing novel treatments in oncology, endocrinology and
women's health, today reported financial and operating results for
the fourth quarter and year ended December 31, 2015.
Commenting on fourth quarter accomplishments, David A. Dodd,
Chairman, President and Chief Executive Officer of the Company,
stated, “Our progress during the fourth quarter was truly
astounding. As we began the quarter, we faced the prospect of
massive dilution from the exercise of warrants that had very
unfavorable terms and a capital structure that challenged our
ongoing operations and our ability to raise further funding. We
ended the quarter with a cleaned-up capital structure and a
successful, significant capital raise on favorable terms. A
tremendous amount of difficult work during the quarter made this
successful turn-around possible. We now have the resources to
complete the Phase 3 studies of both Zoptrex™ and Macrilen™ and to
move the Company to an entirely new level, if our confidence in our
product candidates is demonstrated with positive outcomes of the
clinical programs. I would like to thank our team for their very
hard and dedicated work during the quarter that achieved these
critical accomplishments. I also want to thank our Board for their
commitment and supportive efforts that enabled these successful
achievements. We recognize that substantial progress remains to be
achieved and we are committed to successfully building a profitable
growth-oriented company, providing attractive financial returns to
our shareholders, commercializing meaningful products that improve
the lives of patients and enabling our employees to develop
purposeful careers.”
Commenting on the Company’s product-development progress, Mr.
Dodd stated, “During the fourth quarter, we received very
encouraging news regarding Zoptrex™ when, following a comprehensive
review of the final interim efficacy and safety data, the DSMB
recommended that we continue the ZoptEC Phase 3 clinical study to
its conclusion. We expect to complete the ZoptEC trial in Q3 of
2016 and, if the results of the trial warrant doing so, to file the
NDA for Zoptrex™ in the first half of 2017. More recently, we
reported on the successful progress of the Zoptrex™ development
program in China. We also initiated patient enrollment in our
confirmatory Phase 3 clinical study of Macrilen™, which we expect
to be the first FDA-approved test for the evaluation of adult
growth hormone deficiency. We expect the confirmatory Phase 3
clinical study of Macrilen™ to be concluded in Q3 of 2016, which
would permit us to submit a NDA by mid-year 2017. If the study is
successful in meeting its primary endpoint, we anticipate FDA
approval of Macrilen™ by as early as year-end 2017.”
Continuing with his commentary, Mr. Dodd stated, “Restructuring
our financial team and closing our office in Quebec City was
another very important and difficult accomplishment during the
fourth quarter, which permitted us to further simplify our
operations. We continue our search for a permanent finance staff
and we are committed to taking the time necessary to find the
appropriate expertise and experience that will contribute to our
continued progress. I would like to note that we ended the year
with a global headcount of approximately 48 active employees,
compared to the almost 100 active employees we had when I joined
the company in April of 2013. This restructuring, as well as the
Resource Optimization Program implemented in 2014, has positioned
us to achieve net research and development (“R&D”) and general
and administrative (“G&A”) savings of approximately $2.5
million annually.”
Concluding, Mr. Dodd addressed the Company’s commercial
operations, stating, “Our co-promotions of EstroGel® and Saizen®
continued to ramp up during the fourth quarter, although not at the
pace we are seeking. During 2015, our selling efforts resulted in a
consistent increase of EstroGel® prescriptions within our
territories. Specifically, we increased EstroGel® market share of
total prescriptions for non-patch transdermal estrogen products in
our territories from 23.8% in Q1 to 26.9% in Q4. This resulted in a
17.4% increase in EstroGel® total prescriptions within our
territories over this same period, compared to a 0.5% decline by
our competitors. However, this increase did not result in our
receipt of meaningful commission revenue from our promotion of
EstroGel®. During the fourth quarter, we expanded our Saizen®
target list from the 450 endocrinologists we had during most of
last year to 900 validated targets that we are now addressing. As a
result, recent performance is producing attractive results, which
we expect will result in meaningful commission revenue this year.
During 2016, we expect to achieve more significant commission
revenue for both of these products as we continue our focused
selling efforts. One way to increase the productivity and income
contribution resulting from our selling efforts is to expand our
selling portfolio. During the fourth quarter, we added what we
think will be a significant product, when we concluded a
co-marketing agreement with Armune BioScience for APIFINY®, the
only cancer-specific, non-PSA blood test for the evaluation of the
risk of prostate cancer. This product was launched by our sales
force in mid-February. Early reports from our representatives are
positive regarding the interest in targeted physicians adopting
this product."
Fourth Quarter and Full Year 2015 Financial
Highlights
R&D costs were $4.2 million and $17.2 million for the
three-month period and the year ended December 31, 2015,
respectively, compared to $6.3 million and $23.7 million for the
same periods in 2014. The decrease for the three-month period and
for the year ended December 31, 2015, as compared to the same
period in 2014, is mainly attributable to the realization of cost
savings in connection with our 2014 Resource Optimization Program,
as well as to the weakening, in 2015, of the euro against the US
dollar. The decrease for the year ended December 31, 2015 was
partly offset by higher third-party costs, which increased slightly
during the year ended December 31, 2015, as compared to the same
period in 2014, mainly due to a higher comparative number of
patients enrolled in the ZoptEC clinical trial, which is now fully
enrolled. However, the quarter-over-quarter decrease in third-party
costs is explained by the fact that the number of patients in
treatment was lower in 2015 as compared to the same period in
2014.
G&A expenses were $4.0 million and $11.3 million for the
three-month period and the year ended December 31, 2015,
respectively, as compared to $2.6 million and $9.8 million for the
same periods in 2014. The increase is mainly attributable to the
recording of a provision related to the closure of our Quebec City
office and the restructuring of our finance and accounting team in
the fourth quarter of 2015, as well as to the recording of certain
transaction costs associated with the completion of our March 2015
and December 2015 offerings of Common Shares and warrants.
Selling expenses were $1.8 million and $6.9 million for the
three-month period and the year ended December 31, 2015,
respectively, as compared to $2.0 million and $3.9 million for the
same periods in 2014. The decrease in selling expenses for the
three-month period ended December 31, 2015 is explained by the
start-up costs related to the deployment of our contracted sales
force in connection with the co-promotion activities, which were
launched in late 2014. The increase in selling expenses for the
year ended December 31, 2015 as compared to the same period in
2014, is attributable to the fact that 2014 was not a full year of
sales activity. During the third quarter of 2015, we also expanded
the size of our contracted sales force from 19 to 21 sales
representatives in order to support our promotional efforts
associated with Saizen®. This sales force expense will also cover
the recently initiated selling in support of APIFINY®.
Net (loss) income for the three-month period and the year ended
December 31, 2015 was ($10.0) million and ($50.1) million, or
($1.46) and ($18.14) per basic and diluted share, respectively,
compared to $4.2 million and ($16.6) million, or $6.35 and ($28.06)
per basic and diluted share for the same periods in 2014. The
increase in our net loss from operations for the three-month period
and for the year ended December 31, 2015, as compared to the same
period in 2014, is due to the higher comparative G&A and
selling expenses and net finance costs, partly offset by lower
comparative R&D costs.
Cash and cash equivalents were $41.5 million as at December 31,
2015, compared to $34.9 million as at December 31, 2014.
Conference Call & Webcast
The Company will host a conference call and live webcast to
discuss these results on Wednesday, March 30, 2016, at 8:00 a.m.,
Eastern Time. Participants may access the live webcast via the
Company's website at www.aezsinc.com,
or by telephone using the following number: 201-689-8029,
Confirmation #13632538. A replay of the webcast will also be
available on the Company’s website for a period of 30 days.
For reference, the Management’s Discussion and Analysis of
Financial Condition and Results of Operations for the fourth
quarter and full-year 2015, as well as the Company’s audited
consolidated financial statements as at December 31, 2015 and 2014
and for the years ended December 31, 2015, 2014 and 2013, can
be found at www.aezsinc.com in the
“Investors/Regulatory Filings” section.
About Aeterna Zentaris Inc.
Aeterna Zentaris is a specialty biopharmaceutical company
engaged in developing and commercializing novel treatments in
oncology, endocrinology and women’s health. We are engaged in drug
development activities and in the promotion of products for others.
We are now conducting Phase 3 studies of two internally developed
compounds. The focus of our business development efforts is the
acquisition or license of products that are relevant to our
therapeutic areas of focus. We also intend to license out certain
commercial rights of internally developed products to licensees in
territories where such out-licensing would enable us to ensure
development, registration and launch of our product candidates. Our
goal is to become a growth-oriented specialty biopharmaceutical
company by pursuing successful development and commercialization of
our product portfolio, achieving successful commercial presence and
growth, while consistently delivering value to our shareholders,
employees and the medical providers and patients who will benefit
from our products. For more information, visit www.aezsinc.com.
Forward-Looking Statements
This press release contains forward-looking statements made
pursuant to the safe harbor provisions of the US Securities
Litigation Reform Act of 1995. Forward-looking statements may
include, but are not limited to statements preceded by, followed
by, or that include the words “expects,” “believes,” “intends,”
“anticipates,” and similar terms that relate to future events,
performance, or our results. Forward-looking statements involve
known and unknown risks and uncertainties that could cause the
Company's actual results to differ materially from those in the
forward-looking statements. Such risks and uncertainties include,
among others, the availability of funds and resources to pursue
R&D projects and clinical trials, the successful and timely
completion of clinical studies, the risk that safety and efficacy
data from any of our Phase 3 trials may not coincide with the data
analyses from previously reported Phase 1 and/or Phase 2 clinical
trials, the rejection or non-acceptance of any new drug application
by one or more regulatory authorities and, more generally,
uncertainties related to the regulatory process, the ability of the
Company to efficiently commercialize one or more of its products or
product candidates, the degree of market acceptance once our
products are approved for commercialization, the ability of the
Company to take advantage of business opportunities in the
pharmaceutical industry, the ability to protect our intellectual
property, the potential of liability arising from shareholder
lawsuits and general changes in economic conditions. Investors
should consult the Company's quarterly and annual filings with the
Canadian and US securities commissions for additional information
on risks and uncertainties relating to forward-looking statements.
Investors are cautioned not to place undue reliance on these
forward-looking statements. The Company does not undertake to
update these forward-looking statements. We disclaim any obligation
to update any such factors or to publicly announce the result of
any revisions to any of the forward-looking statements contained
herein to reflect future results, events or developments, except if
required to do so.
Attachment: Financial summary
Consolidated Statements of Comprehensive (Loss) Income
Information
(unaudited)
Three-month periods ended
December 31,
Years ended December 31, (in thousands)
2015
2014 2015 2014
2013 $ $ $ $ $
Revenues Sales commission and other
41 —
297 —
96 License fees
61 11
248 11
6,079
102 11
545
11 6,175
Operating expenses Cost of sales
— —
— — 51 Research and development costs
4,243 6,282
17,234 23,716 21,284 General and
administrative expenses
3,953 2,633
11,308 9,840
11,091 Selling expenses
1,764 2,043
6,887 3,850 1,225
9,960
10,958
35,429 37,406 33,651
Loss from operations (9,858 ) (10,947 )
(34,884 ) (37,395 ) (27,476 ) Finance income
26 15,053
305 20,319 1,748 Finance costs
(211
) —
(15,649 ) — (1,512 )
Net
finance (costs) income (185 ) 15,053
(15,344 ) 20,319 236 (Loss) income
before income taxes
(10,043 ) 4,106
(50,228
) (17,076 ) (27,240 ) Income tax expense
—
(111 )
— (111 ) —
Net (loss) income from
continuing operations (10,043 ) 3,995
(50,228 ) (17,187 ) (27,240 )
Net income from
discontinued operations 25 158
85
623 34,055
Net (loss) income
(10,018 ) 4,153
(50,143 ) (16,564 )
6,815
Other comprehensive (loss) income: Items that may be
reclassified subsequently to profit or loss: Foreign currency
translation adjustments
249 (677 )
1,509 (1,158 )
1,073 Items that will not be reclassified to profit or loss:
Actuarial (loss) gain on defined benefit plans
(116 )
1,336
844 (1,833 ) 2,346
Comprehensive (loss) income (9,885 ) 4,812
(47,790 ) (19,555 ) 10,234
Net
(loss) income per share (basic and diluted) from continuing
operations1 (1.46 ) 6.11
(18.17 ) (29.12 ) (92.41 )
Net income purchase per
share (basic and diluted) from discontinued operations1
0.00 0.24
0.03 1.06 115.53
Net (loss) income per share (basic and
diluted)1 (1.46 ) 6.35
(18.14 ) (28.06 ) 23.12
Weighted average
number of shares outstanding1 Basic
6,874,460
653,833
2,763,603 590,247
294,765 Diluted
7,302,816 653,833
3,424,336 590,247 294,765
1 Adjusted to reflect the November 17, 2015 100 - 1 share
consolidation
Consolidated Statement of Financial Position
Information
(unaudited)
As at December 31, (in thousands)
2015
2014 $ $ Cash and cash equivalents1
41,450 34,931 Trade and other receivables and other current
assets
944 1,286 Restricted cash equivalents
255 760
Property, plant and equipment
256 797 Other non-current
assets
8,593 9,661
Total assets 51,498
47,435 Payables and other current liabilities2
4,770
7,304 Current portion of deferred revenues
244 270 Warrant
liability (current and non-current portion)
10,891 8,225
Non-financial non-current liabilities3
13,978 17,152
Total liabilities 29,883 32,951
Shareholders'
equity 21,615 14,484
Total liabilities and
shareholders' equity 51,498 47,435
_________________________
1 Of which approximately $1.5 million was denominated in EUR as
of December 31, 2015 ($3.6 million as of December 31, 2014).
2 Of which approximately $0.6 million is related to a provision
for restructuring costs as of December 31, 2015 ($1.5 million as of
December 31, 2014).
3 Comprised mainly of employee future benefits, provisions for
onerous contracts and non-current portion of deferred revenues.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160329006498/en/
Aeterna Zentaris Inc.Philip A. Theodore, Senior Vice
PresidentIR@aezsinc.com843-900-3211
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