Axovant Gene Therapies Ltd. (NASDAQ: AXGT), a clinical-stage
company developing innovative gene therapies, today provided
financial results for its third fiscal quarter ended December 31,
2019.
Fiscal Third Quarter Financial
Summary
Research and development expenses were $8.3 million for the
third fiscal quarter ended December 31, 2019 compared to $21.5
million for the third fiscal quarter ended December 31, 2018.
Research and development expenses decreased by $4.2 million in the
current year period, after excluding a $10.0 million upfront
license fee paid in the prior year period to the University of
Massachusetts Medical School ("UMMS") and $1.0 million due to UMMS
for development and regulatory milestones achieved in the current
year period. While program-specific costs increased during the
period for the programs currently under development, they were
offset by decreases related to the discontinuation of our
AXO-AAV-OPMD and nelotanserin programs, as well as decreases in
share-based compensation and personnel-related costs primarily
associated with a decrease in headcount.
General and administrative expenses decreased by $5.5 million
from $10.9 million for the three months ended December 31,
2018 to $5.4 million in the three months ended December 31, 2019,
primarily due to reductions in (i) personnel costs of $1.7 million
and share-based compensation expense of $1.2 million attributable
to reduced headcount, (ii) legal, accounting and other
administrative professional fees of $1.6 million and (iii) costs
allocated under our services agreements with Roivant Sciences, Inc.
("RSI") and Roivant Sciences GmbH ("RSG") of $0.6 million as a
result of the decentralization of the services provided to us.
Going forward, the costs allocated to us under our services
agreements with RSI and RSG are expected to continue to be
insignificant.
Net loss for the fiscal third quarter ended December 31,
2019 was $14.0 million, or $0.62 per share, based on a
weighted-average of 22.8 million common shares outstanding,
compared to a net loss of $34.3 million, or $2.13 per share, based
on a weighted-average of 16.1 million common shares outstanding for
the quarter ended December 31, 2018.
Nine-Months Financial
Summary
Research and development expenses were $36.2 million for the
nine months ended December 31, 2019 compared to $80.4 million
for the nine months ended December 31, 2018. Research and
development expenses decreased by $13.2 million in the current year
period, after excluding a net amount of $13.0 million due to Oxford
BioMedica (UK) Ltd. ("Oxford") for a development milestone achieved
and $1.0 million due to UMMS for development and regulatory
milestones achieved in the current year period, as well as the
upfront license fees of $25.0 million paid to Oxford, $10.0 million
paid to Benitec Biopharma Limited ("Benitec") and $10.0 million
paid to UMMS in the prior year period. While program-specific costs
increased during the period for the programs currently under
development, they were offset by decreases related to the
discontinuation of our legacy intepirdine, nelotanserin and
AXO-AAV-OPMD programs, as well as decreases in share-based
compensation and personnel-related costs primarily associated with
a decrease in headcount, in addition to costs allocated under our
services agreements with RSI and RSG as a result of the
decentralization of the services provided to us.
General and administrative expenses decreased by $16.4 million
from $33.3 million for the nine months ended December 31, 2018 to
$16.9 million in the nine months ended December 31, 2019,
primarily due to reductions in (i) share-based compensation expense
of $6.2 million and personnel costs of $1.5 million attributable to
reduced headcount, (ii) legal, accounting and other administrative
professional fees of $4.7 million, and (iii) costs allocated under
our services agreements with RSI and RSG of $2.5 million as a
result of the decentralization of the services provided to us.
Net loss for the nine months ended December 31, 2019 was
$56.0 million, or $2.46 per share, based on a weighted-average of
22.8 million common shares outstanding, compared to a net loss of
$120.0 million, or $8.06 per share, based on a weighted-average of
14.9 million common shares outstanding for the nine months ended
December 31, 2018. Net cash used in operating activities for the
nine months ended December 31, 2019 was $49.6 million, or
$41.6 million excluding a total of $8.0 million paid to Oxford and
UMMS for development and regulatory milestones achieved.
In November 2019, we amended our loan and security agreement
with Hercules Capital, Inc. ("Hercules"), which, among other
things, provides for a 9-month interest-only period that commenced
in December 2019, the elimination of the covenant to maintain a
minimum cash balance, and prepayment of 50%, or approximately $15.7
million, of outstanding principal due without penalty. No new
securities or derivatives in Axovant Gene Therapies Ltd. were
issued as part of this loan amendment with Hercules.
As of December 31, 2019, we had $27.8 million of cash and cash
equivalents, working capital of $2.7 million, and total debt of
$15.3 million, net of discount, of which $6.5 million was
classified as long-term debt.
About Axovant
Axovant Gene Therapies, part of the Roivant family of companies,
is a clinical-stage company focused on developing a pipeline of
innovative gene therapy product candidates for debilitating
neurological diseases. The company's current pipeline of gene
therapy candidates targets GM1 gangliosidosis, GM2 gangliosidosis
(including Tay-Sachs disease and Sandhoff disease), and Parkinson’s
disease. Axovant is focused on accelerating product candidates into
and through clinical trials with a team of experts in gene therapy
development and through external partnerships with leading gene
therapy organizations. For more information, visit
www.axovant.com.
About Roivant
Roivant Sciences aims to improve health by rapidly delivering
innovative medicines and technologies to patients. It does this by
building Vants – nimble, entrepreneurial biotech and healthcare
technology companies with a unique approach to sourcing talent,
aligning incentives, and deploying technology to drive greater
efficiency in R&D and commercialization. For more information,
please visit www.roivant.com.
Forward-Looking Statements
This press release contains forward-looking statements for the
purposes of the safe harbor provisions under The Private Securities
Litigation Reform Act of 1995 and other federal securities laws.
The use of words such as "may," "might," "will," "would," "should,"
"expect," "believe," "estimate," and other similar expressions are
intended to identify forward-looking statements. For example, all
statements Axovant makes regarding costs associated with its
operating activities are forward-looking. All forward-looking
statements are based on estimates and assumptions by Axovant’s
management that, although Axovant believes to be reasonable, are
inherently uncertain. All forward-looking statements are subject to
risks and uncertainties that may cause actual results to differ
materially from those that Axovant expected. Such risks and
uncertainties include, among others, the initiation and conduct of
preclinical studies and clinical trials; the availability of data
from clinical trials; the expectations for regulatory submissions
and approvals; the continued development of its gene therapy
product candidates and platforms; Axovant’s scientific approach and
general development progress; and the availability or commercial
potential of Axovant’s product candidates. These statements are
also subject to a number of material risks and uncertainties that
are described in Axovant’s most recent Quarterly Report on Form
10-Q filed with the Securities and Exchange Commission on February
10, 2020, as updated by its subsequent filings with the Securities
and Exchange Commission. Any forward-looking statement speaks only
as of the date on which it was made. Axovant undertakes no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
Contacts:
Media and Investors
Parag MeswaniAxovant Gene Therapies(212)
547-2523investors@axovant.commedia@axovant.com
AXOVANT GENE THERAPIES
LTD.Condensed Consolidated Statements of
Operations(Unaudited, in thousands, except share and per
share amounts)
| |
Three Months Ended December 31, |
|
Nine Months Ended December 31, |
| |
2019 |
|
2018 |
|
2019 |
|
2018 |
| Operating expenses: |
|
|
|
|
|
|
|
| Research and development
expenses(1) |
|
|
|
|
|
|
|
|
(includes share-based compensation expense of $876 and $1,910 for
the three months ended December 31, 2019 and 2018 and $2,006 and
$3,299 for the nine months ended December 31, 2019 and 2018,
respectively) |
$ |
8,267 |
|
|
$ |
21,483 |
|
|
$ |
36,190 |
|
|
$ |
80,403 |
|
| General and administrative
expenses(2) |
|
|
|
|
|
|
|
|
(includes share-based compensation expense of $1,436 and $2,648 for
the three months ended December 31, 2019 and 2018 and $3,332 and
$9,575 for the nine months ended December 31, 2019 and 2018,
respectively) |
5,409 |
|
|
10,933 |
|
|
16,928 |
|
|
33,309 |
|
|
Total operating expenses |
13,676 |
|
|
32,416 |
|
|
53,118 |
|
|
113,712 |
|
| Other (income) expenses: |
|
|
|
|
|
|
|
|
Interest expense |
1,066 |
|
|
1,906 |
|
|
3,937 |
|
|
5,808 |
|
|
Other (income) expense |
(694 |
) |
|
(78 |
) |
|
(1,231 |
) |
|
275 |
|
| Loss before income tax
expense |
(14,048 |
) |
|
(34,244 |
) |
|
(55,824 |
) |
|
(119,795 |
) |
| Income tax expense (benefit) |
(9 |
) |
|
52 |
|
|
156 |
|
|
224 |
|
| Net loss |
$ |
(14,039 |
) |
|
$ |
(34,296 |
) |
|
$ |
(55,980 |
) |
|
$ |
(120,019 |
) |
| Net loss per common share — basic
and diluted |
$ |
(0.62 |
) |
|
$ |
(2.13 |
) |
|
$ |
(2.46 |
) |
|
$ |
(8.06 |
) |
| Weighted-average common shares
outstanding — basic and diluted |
22,791,669 |
|
|
16,096,488 |
|
|
22,785,006 |
|
|
14,897,890 |
|
(1) Includes total costs (benefit) allocated from certain wholly
owned subsidiaries of our parent company, Roivant Sciences Ltd., of
$0 and $(450) for the nine months ended December 31, 2019 and 2018,
respectively. No such costs (benefit) were allocated during the
three months ended December 31, 2019 and 2018.
(2) Includes total costs allocated from certain wholly owned
subsidiaries of our parent company, Roivant Sciences Ltd., of $27
and $698 for the three months ended December 31, 2019 and 2018,
respectively, and $103 and $2,772 for the nine months ended
December 31, 2019 and 2018, respectively.
AXOVANT GENE THERAPIES
LTD.Condensed Consolidated Balance
Sheets(Unaudited, in thousands, except share and per share
amounts)
| |
December 31, 2019 |
|
March 31, 2019 |
| Assets |
|
|
|
| Current assets: |
|
|
|
|
Cash and cash equivalents |
$ |
27,812 |
|
|
$ |
106,999 |
|
|
Prepaid expenses and other current assets |
3,621 |
|
|
5,859 |
|
|
Income tax receivable |
1,988 |
|
|
1,726 |
|
|
Total current assets |
33,421 |
|
|
114,584 |
|
| Long-term investment |
5,871 |
|
|
5,871 |
|
| Other non-current assets |
46 |
|
|
973 |
|
| Operating lease right-of-use
assets |
1,946 |
|
|
— |
|
| Property and equipment, net |
980 |
|
|
1,278 |
|
|
Total assets |
$ |
42,264 |
|
|
$ |
122,706 |
|
| |
|
|
|
| Liabilities and
Shareholders’ Equity |
|
|
|
| Current liabilities: |
|
|
|
|
Accounts payable |
$ |
347 |
|
|
$ |
1,698 |
|
|
Accrued expenses |
20,334 |
|
|
20,619 |
|
|
Current portion of operating lease liabilities |
1,156 |
|
|
— |
|
|
Current portion of long-term debt |
8,851 |
|
|
21,182 |
|
|
Total current liabilities |
30,688 |
|
|
43,499 |
|
| Operating lease liabilities, net
of current portion |
77 |
|
|
— |
|
| Long-term debt |
6,452 |
|
|
22,994 |
|
|
Total liabilities |
37,217 |
|
|
66,493 |
|
| |
|
|
|
| Shareholders’ equity: |
|
|
|
|
Common shares, par value $0.00001 per share, 1,000,000,000 shares
authorized, 22,791,669 and 22,779,891 issued and outstanding at
December 31, 2019 and March 31, 2019, respectively |
— |
|
|
— |
|
|
Additional paid-in capital |
746,845 |
|
|
741,318 |
|
|
Accumulated deficit |
(741,996 |
) |
|
(686,016 |
) |
|
Accumulated other comprehensive income |
198 |
|
|
911 |
|
|
Total shareholders’ equity |
5,047 |
|
|
56,213 |
|
| Total liabilities and
shareholders’ equity |
$ |
42,264 |
|
|
$ |
122,706 |
|
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