Celsion Corporation (NASDAQ: CLSN), an oncology drug
development company, today announced financial results for the
three and nine months ended September 30, 2020, and provided an
update on clinical development programs with GEN-1, its
DNA-mediated IL-12 immunotherapy currently in Phase II development
for the treatment of advanced ovarian cancer, and ThermoDox®, its
proprietary heat-activated liposomal encapsulation of doxorubicin
currently in Phase III development for the treatment of
hepatocellular carcinoma (HCC), or primary liver cancer.
“The OVATION 2 Study
with our GEN-1 immunotherapy continues recruitment into the 100
mg/m² dose cohort,” said Michael H. Tardugno, Celsion’s chairman,
president and chief executive officer. “This study is based on
encouraging results from our Phase Ib OVATION 1 Study in advanced
ovarian cancer. In June 2020, the Data Safety Monitoring Board
(DSMB) for the OVATION 2 Study recommended that the Phase II
portion proceed with the dose of 100 mg/m2, and in July 2020, we
announced the randomization of the first two patients in this
portion of the Study. This milestone was achieved approximately
five months ahead of our previously announced schedule. We have a
very aggressive recruitment program in place and anticipate
completing enrollment of approximately 110 patients in the second
or third quarter of 2021. Importantly, as an open-label study,
clinical updates will be provided throughout the course of
treatment, including response rates and surgical resection scores,”
Mr. Tardugno added.
Continuing his comments, Mr. Tardugno noted,
“Since the DMC’s finding that the OPTIMA Study crossed the futility
boundary, albeit with substantial uncertainty, and leaving the
decision to terminate the Study up to the Company, we have
determined to continue following patients for overall survival (OS)
until such time as futility is either confirmed or dispelled.”
Mr. Tardugno added, “As promised, Celsion has
engaged a global biometrics contract research organization (CRO),
with forensic statistical analysis capability that specializes in
data management, statistical consulting, statistical analysis and
data sciences. They have particular expertise in evaluating unusual
data from clinical trials, and experience with associated
regulatory issues. The primary objective of the CRO’s work is to
determine the basis and reasoning behind continuing to follow
patients for OS. Also as promised, and in parallel, the Company has
submitted all OPTIMA Study clinical trial data to the National
Institutes of Health (NIH) for an independent evaluation using a
Cox Regression Analysis for minimum burn time per tumor volume.
This evaluation is similar to the hypothesis generated from the NIH
paper published in the Journal of Vascular and Interventional
Radiology.”
In conclusion, Mr. Tardugno stated, “Celsion
feels strongly that we owe it to patients, physicians and our
investors to continue examining the data from the OPTIMA Study,
particularly given how surprising the recommendation was to Celsion
from the DMC. While the trial outcome as predicted by the second
interim analysis may not change, and as unlikely as it may be, in
the event we see substantial clinical benefit from the CRO and NIH
analyses, we will carefully review our options with the 14
regulatory agencies under which the OPTIMA Study is being
conducted. We expect to report findings from these independent
analyses before the end of the year, either or both of which will
guide our decision to continue to follow patients to the final
analysis at 197 or more deaths, a milestone we expect to be reached
in mid-2021.”
Recent
Developments
GEN-1
Immunotherapy
Initiation of Phase II OVATION 2 Study
in Advanced Ovarian Cancer. In July 2020, the Company
announced the randomization of the first two patients in the Phase
II portion of the OVATION 2 Study with GEN-1 in advanced ovarian
cancer. The Company anticipates completing enrollment of up to 118
patients in mid-summer 2021. Because this is an open-label study,
clinical updates will be provided throughout the course of
treatment including response rates and surgical resection scores.
The OVATION 2 Study combines GEN-1 with standard-of-care
neoadjuvant chemotherapy (NACT) in patients newly diagnosed with
Stage III/IV ovarian cancer. NACT is designed to shrink the tumor
as much as possible for optimal surgical removal after three cycles
of chemotherapy. Following NACT, patients undergo interval
debulking surgery, followed by three adjuvant cycles of
chemotherapy and up to nine additional weekly GEN-1 treatments, the
goal of which is to delay progression and improve OS. The OVATION 2
Study is an open-label, 1-to-1 randomized trial, 80% powered to
show the equivalent of a 33% improvement in progression-free
survival (PFS) (HR=0.75), the primary endpoint, when comparing the
treatment arm (standard of care + GEN-1) with the control arm
(standard of care alone).
ThermoDox®
Patients in Phase III OPTIMA Study
Continue to be Followed for Overall Survival. In August
2020, the Company provided an update on its ongoing review of
unblinded data from the second pre-planned interim analysis of the
global Phase III OPTIMA Study. The Company announced it will
continue following patients for OS, noting that the unexpected and
marginally crossed futility boundary suggested by the Kaplan-Meier
analysis at the second interim analysis on July 9, 2020 may be
associated with a data maturity issue.
Recommendation from the Independent DMC
to Consider Stopping the Phase III OPTIMA Study of ThermoDox® in
Primary Liver Cancer. In July 2020, the Company announced
that it received a recommendation from the independent DMC to
consider stopping the global Phase III OPTIMA Study. The
recommendation was made following the second pre-planned interim
safety and efficacy analysis by the DMC on July 9, 2020. The DMC
analysis found that the pre-specified boundary for stopping the
trial for futility of 0.900 was crossed with an actual value of
0.903. However, the p-value of 0.524 for this analysis provides
uncertainty. The DMC left the final decision of whether or not to
stop the OPTIMA Study to Celsion. There were no safety concerns
noted during the interim analysis.
The statistical plan for the OPTIMA Study
included two interim efficacy analyses by the DMC. The first
interim analysis was announced in November 2019 following data lock
in August 2019 after the prescribed minimum number of 128 patient
events (deaths) was reached, and the second interim analysis was
conducted on July 9, 2020 following data lock in April 2020 after
the prescribed minimum number of 158 events was reached.
Corporate Developments
New Common Stock Purchase Agreement with
Lincoln Park Capital. In September 2020, the Company
announced a common stock purchase agreement for the issuance and
sale, from time to time, of up to $26 million of shares of
common stock with Lincoln Park Capital Fund, LLC (LPC). In
connection with the execution of the purchase agreement, LPC made
an initial purchase of $1 million of common stock at $1.00 per
share, representing a significant premium to the then-current
market price. Under the terms of the new purchase agreement with
LPC, the Company has the right at its sole discretion, but not the
obligation, to sell to LPC up to $26 million worth of shares
(including the $1 million initially purchased) over the 36-month
term of the agreement, subject to certain conditions. There are no
upper limits to the price per share LPC may pay to purchase the
shares, and the purchase price of the shares will be based on the
prevailing market prices at the time of each sale to LPC. Celsion
controls the timing and amount of any future sales of its stock to
LPC. There are no warrants, derivatives, financial or business
covenants associated with the agreement, and LPC has agreed not to
cause or engage in any direct or indirect short selling or hedging
of Celsion’s common stock.
Strategic Loan Facility with Horizon
Technology Finance Corporation Restructured. In September
2020, the Company announced an amendment to its $10 million loan
agreement with Horizon Technology Finance Corporation. Consistent
with its target to leverage equity capital, the Company elected to
reduce its outstanding debt under the loan by $5 million and
restructure the terms of the remaining $5 million loan balance. The
Company’s restructured $5 million loan is in the form of secured
indebtedness bearing interest at a LIBOR-based variable rate.
Payments under the loan agreement are interest only for the first
12 months through July 2021, followed by a 21-month amortization
period of principal and interest through the scheduled maturity
date of April 2023. In conjunction with the amended loan agreement,
Celsion issued to Horizon warrants exercisable for 247,525 shares
of Celsion’s common stock at an exercise price of $1.01 per share.
Warrants previously issued to Horizon exercisable for 95,057 shares
at an exercise price of $2.63 per share were cancelled.
Third Quarter Financial
Results
For the quarter ended September 30, 2020,
Celsion reported a net loss of $8.1 million ($0.24 per share),
compared with $5.5 million ($0.25 per share) in the same period of
2019.
Research and development expenses decreased $1.2
million to $2.5 million in the third quarter of 2020, compared with
$3.7 million in the third quarter of 2019. Clinical
development costs for the Phase III OPTIMA Study decreased $0.7
million to $0.5 million in the third quarter of 2020, compared with
$1.2 million in the third quarter of 2019, due to the completion of
enrollment in this 556-patient trial in August 2018. Costs
associated with the OVATION 2 Study were $0.2 million in each of
the third quarters of 2020 and 2019. Other costs related to
clinical supplies and regulatory support for the ThermoDox® and
GEN-1 clinical development programs decreased to $1.3 million in
the current quarter from $1.4 million in the third quarter of 2019,
largely driven by lower regulatory costs for ThermoDox®. General
and administrative expenses were $1.8 million in each of the third
quarters of 2020 and 2019.
Operating expenses were $4.3 million in the
third quarter of 2020, which represented a $1.2 million (21.8%)
decrease from $5.5 million in the same period of 2019. These lower
operating expenses were offset by the following non-operating
expenses: (i) a non-cash charge of $1.1 million for the change in
valuation of the earn-out milestone liability for the GEN-1 ovarian
product candidate; and (ii) a non-cash charge of $2.4 million
related to the impairment of certain in-process research and
development assets related to the development of the Company’s GBM
cancer product candidate.
In connection with the Company’s venture debt
facility with Horizon entered in late June 2018, the Company repaid
$5.0 million of the loan and restructured the remaining $5.0
million for one-year interest only payments and 21-month payback
period thereafter. The Company incurred interest expense of $0.5
million during the third quarter of 2020. This compares with
interest expense of $0.3 million in the comparable prior-year
period.
The Company ended the third quarter of 2020 with
$18.3 million in cash and cash equivalents. Coupled with
future planned sales of its New Jersey NOL’s, the Company believes
it has sufficient capital resources to fund its operations through
the end of 2021. The Company has based its estimates on assumptions
that may prove to be wrong and, accordingly, the Company may need
to obtain additional funds sooner or in greater amounts than is
currently anticipated.
Nine Month Financial
Results
For the nine months ended September 30, 2020,
the Company reported a net loss of $18.5 million ($0.62 per share),
compared with $13.7 million ($0.67 per share) in the same period of
2019.
Research and development expenses decreased $1.5
million to $8.5 million in the first nine months of 2020 from $10.0
million in the comparable prior year period. Clinical development
costs for the Phase III OPTIMA Study decreased by $1.5 million to
$1.8 million in the first nine months of 2020, compared with $3.3
million in the first nine months of 2019, due to the completion of
enrollment in this 556-patient trial in August 2018. Costs
associated with the OVATION 2 Study increased to $0.7 million in
the first nine months of 2020, compared with $0.4 million in the
comparable nine-month period in 2019. Other costs related to
ThermoDox® and GEN-1 clinical development programs decreased by
$0.2 million in the first nine months of 2020, compared with the
same prior-year period due to lower regulatory costs for the
ThermoDox development program.
General and administrative expenses were $5.5
million in the first nine months of 2020, compared with $6.2
million in the same period of 2019. This 11% decrease was
primarily attributable to lower professional fees.
Operating expenses were $14.1 million during the
first nine months of 2020, which represented a $2.1 million (13%)
decrease from $16.2 million in the same period of 2019. These
lower operating expenses in the first nine months of 2020 were
offset by the following non-operating expenses: (i) a non-cash
charge of $1.4 million for the change in valuation of the earn-out
milestone liability for the GEN-1 ovarian product candidate,
compared with a non-cash gain of $2.7 million, net of charge of
$0.4 million, for the 200,000 warrant issuance related to an
amendment for the potential milestone payments for the GEN-1
ovarian product candidate during the comparable prior-year period;
and, (ii) a non-cash charge of $2.4 million related to the
impairment of certain in-process research and development assets
related to the development of the Company’s GBM cancer product
candidate.
The Company realized $0.1 million of interest
income during the first nine months of 2020 and $0.4 million in the
comparable prior-year period. The Company incurred interest expense
of $1.2 million and $1.0 million during the first nine months of
2020 and 2019, respectively.
Net cash used for operating activities was $11.9
million in the first nine months of 2020, compared with $16.2
million in the same period in 2019. This was in line with the
Company’s projected cash utilization for 2020 of approximately
$15.6 million, or an average of approximately $3.9 million per
quarter. Cash provided by financing activities was $15.4 million
during the first nine months of 2020 resulting from equity
offerings in March 2020 and June 2020, and proceeds from (i) the
sale of equity from its ATM facility with Jones Trading, (ii) the
sale of equity from its Common Stock Purchase Agreement with
Lincoln Park Capital, including a $1 million sale at 22% premium to
market in September 2020, and (iii) the exercise of stock
options.
Third Quarter Conference
Call
The Company will host a conference call to
provide a business update and discuss third quarter 2020 financial
results at 11:00 a.m. EST today. To participate in the call,
interested parties may dial 1-800-367-2403 (Toll-Free/North
America) or 1-334-777-6978 (International/Toll) 10 minutes before
the call is scheduled to begin, and ask for the Celsion Corporation
Third Quarter 2020 Earnings Call (Conference Code: 8337630). The
call will also be broadcast live on the internet at
www.celsion.com.
The call will be archived for replay on November
16, 2020 and will remain available until November 30, 2020. The
replay can be accessed at 1-719-457-0820 or 1-888-203-1112 using
Conference ID: 8337630. An audio replay of the call will also be
available on the Company's website, www.celsion.com, for 90 days
after 2:00 p.m. EST on November 16, 2020.
About Celsion
Corporation
Celsion is a fully integrated oncology company
focused on developing a portfolio of innovative cancer treatments,
including immunotherapies, DNA-based therapies and directed
chemotherapies. The Company’s product pipeline includes GEN-1, a
DNA-based immunotherapy for the localized treatment of ovarian
cancer and ThermoDox®, a proprietary heat-activated liposomal
encapsulation of doxorubicin, currently in Phase III development
for the treatment of primary liver cancer and in development for
other cancer indications. Celsion has two feasibility stage
platform technologies for the development of novel nucleic
acid-based immunotherapies and other anti-cancer DNA or RNA
therapies. Both are novel synthetic, non-viral vectors with
demonstrated capability in nucleic acid cellular transfection. For
more information on Celsion, visit: http://www.celsion.com.
(CLSN-FIN).
Celsion wishes to
inform readers that forward-looking statements in this release are
made pursuant to the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. Readers are cautioned
that such forward-looking statements involve risks and
uncertainties including, without limitation, unforeseen changes in
the course of research and development activities and in clinical
trials; the uncertainties of and difficulties in analyzing interim
clinical data; the significant expense, time, and risk of failure
of conducting clinical trials; the need for Celsion to evaluate its
future development plans; possible acquisitions or licenses of
other technologies, assets or businesses; possible actions by
customers, suppliers, investors, competitors or regulatory
authorities; and other risks detailed from time to time in
Celsion's periodic reports and prospectuses filed with the
Securities and Exchange Commission. Celsion assumes no obligation
to update or supplement forward-looking statements that become
untrue because of subsequent events, new information or
otherwise.
Celsion Investor Contact
Jeffrey W.
Church609-482-2455 jchurch@celsion.com
LHA Investor
RelationsKim Sutton
Golodetz212-838-3777kgolodetz@lhai.com
Celsion
CorporationCondensed Statements of
Operations(in thousands except per share
amounts)
|
|
Three Months EndedSeptember
30, |
|
|
Nine Months EndedSeptember
30, |
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Licensing revenue |
|
$ |
125 |
|
|
$ |
125 |
|
|
$ |
375 |
|
|
$ |
375 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
2,492 |
|
|
|
3,674 |
|
|
|
8,535 |
|
|
|
10,000 |
|
General and administrative |
|
|
1,793 |
|
|
|
1,839 |
|
|
|
5,533 |
|
|
|
6,193 |
|
Total operating expenses |
|
|
4,285 |
|
|
|
5,513 |
|
|
|
14,068 |
|
|
|
16,193 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(4,160 |
) |
|
|
(5,388 |
) |
|
|
(13,693 |
) |
|
|
(15,818 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) gain from change in valuation of earn-out milestone
liability |
|
|
(1,100 |
) |
|
|
86 |
|
|
|
(1,397 |
) |
|
|
3,089 |
|
Loss from impairment of in-process research and development |
|
|
(2,370 |
) |
|
|
– |
|
|
|
(2,370 |
) |
|
|
– |
|
Fair value of warrants issued in connection with amendment to
modify GEN-1 earn-out milestone payment |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(400 |
) |
Interest expense, investment income and other income (expense),
net |
|
|
(442 |
) |
|
|
(175 |
) |
|
|
(1,011 |
) |
|
|
(620 |
) |
Total other income (expense), net |
|
|
(3,912 |
) |
|
|
(89 |
) |
|
|
(4,778 |
) |
|
|
2,069 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(8,072 |
) |
|
$ |
(5,477 |
) |
|
$ |
(18,471 |
) |
|
$ |
(13,749 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted |
|
$ |
(0.24 |
) |
|
$ |
(0.25 |
) |
|
$ |
(0.62 |
) |
|
$ |
(0.67 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted |
|
|
34,112 |
|
|
|
21,663 |
|
|
|
29,935 |
|
|
|
20,525 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Celsion
CorporationSelected Balance Sheet
Information(in thousands)
ASSETS |
|
September 30,
2020(Unaudited) |
|
|
December 31,2019 |
|
Current
assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
18,340 |
|
|
$ |
6,875 |
|
Investment securities and interest receivable on investment
securities |
|
|
– |
|
|
|
8,007 |
|
Advances, deposits on clinical programs and other current
assets |
|
|
1,566 |
|
|
|
1,353 |
|
Total current assets |
|
|
19,906 |
|
|
|
16,235 |
|
|
|
|
|
|
|
|
|
|
Property and
equipment |
|
|
302 |
|
|
|
405 |
|
|
|
|
|
|
|
|
|
|
Other
assets |
|
|
|
|
|
|
|
|
Deferred tax asset |
|
|
- |
|
|
|
1,820 |
|
In-process research and development |
|
|
13,366 |
|
|
|
15,736 |
|
Goodwill |
|
|
1,976 |
|
|
|
1,976 |
|
Operating lease right-of-use assets, net |
|
|
1,147 |
|
|
|
1,432 |
|
Other intangible assets, deposits and other assets |
|
|
578 |
|
|
|
674 |
|
Total other assets |
|
|
17,067 |
|
|
|
21,638 |
|
Total
assets |
|
$ |
37,275 |
|
|
$ |
38,278 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
4,088 |
|
|
$ |
5,166 |
|
Notes payable – current portion |
|
|
416 |
|
|
|
1,840 |
|
Operating lease liability – current portion |
|
|
422 |
|
|
|
388 |
|
Deferred revenue - current portion |
|
|
500 |
|
|
|
500 |
|
Total current liabilities |
|
|
5,426 |
|
|
|
7,894 |
|
|
|
|
|
|
|
|
|
|
Earn-out milestone liability |
|
|
7,115 |
|
|
|
5,718 |
|
Notes payable |
|
|
4,627 |
|
|
|
7,963 |
|
Operating lease liability |
|
|
823 |
|
|
|
1,144 |
|
Deferred revenue and other liabilities |
|
|
625 |
|
|
|
1,000 |
|
Total liabilities |
|
|
18,616 |
|
|
|
23,719 |
|
Stockholders’
equity |
|
|
|
|
|
|
|
|
Common stock |
|
|
362 |
|
|
|
232 |
|
Additional paid-in capital |
|
|
327,370 |
|
|
|
304,886 |
|
Accumulated other comprehensive gain (loss) |
|
|
– |
|
|
|
43 |
|
Accumulated deficit |
|
|
(308,988 |
) |
|
|
(290,517 |
) |
|
|
|
18,744 |
|
|
|
14,644 |
|
Less: Treasury stock |
|
|
(85 |
) |
|
|
(85 |
) |
Total stockholders’ equity |
|
|
18,659 |
|
|
|
14,559 |
|
Total liabilities and
stockholders’ equity |
|
$ |
37,275 |
|
|
$ |
38,278 |
|
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