BERLIN--(BUSINESS WIRE)--MOLOGEN AG (ISIN DE0006637200; Frankfurt Stock Exchange Prime Standard: MGN) had an eventful and positive fiscal year 2016. Almost all key milestones were reached in the last financial year. The main focus was on developing and implementing the new “Next Level” corporate strategy, with its clear concentration on the further development of the lead product candidate, the immunotherapy lefitolimod. All four current studies with lefitolimod have reported good progress. In particular, initial positive results were presented for the TEACH study in the indication human immunodeficiency virus (HIV). In addition, the first combination study of lefitolimod with another immunotherapeutic agent started in the reporting period. As expected, the study advancements resulted in a slight increase in expenditure in the area of research and development.
MOLOGEN secured the future funding – for both the company's new alignment and the continuation of studies with lefitolimod and the follow-up molecules EnanDIM® – through two successfully completed capital measures, with the capital increase and the convertible bond generating gross proceeds of €16.1 million in total.
Over the past financial year, there were two changes on the Executive Board of MOLOGEN AG: since 1 April 2016, Walter Miller has been the new Chief Financial Officer (CFO) of MOLOGEN AG. On 31 March 2016, the Chief Medical Officer (CMO) Dr. Alfredo Zurlo left the company. He is being succeeded by Dr. Matthias Baumann, who will start in his new position on 1 May 2017.
Dr. Mariola Söhngen, Chief Executive Officer (CEO) of MOLOGEN AG: “For MOLOGEN, 2016 was an eventful and at the same time good year in which we laid the foundations for our future success: with our new “Next Level” corporate strategy, we have set a clear strategic course that will enable us in future to adopt a new positioning as a product-oriented company with a strong lead product, our immunotherapeutic agent lefitolimod. Our principal objective is to prepare lefitolimod for possible market entry. To this end, we pressed on with approval preparation and held further discussions with potential partners. In the past year, we made further significant progress in our clinical studies with lefitolimod. Through the two capital measures in 2016 and the issuance of a second convertible bond in January 2017, we have been able to secure our funding into 2018. On the personnel side, we have gained two extremely experienced and competent new Executive Board members in Walter Miller for the position of CFO and now also Dr. Matthias Baumann as a new CMO. They will both make a positive contribution to advancing the development of the company.”
Broad application spectrum for lefitolimod
In the wake of a comprehensive portfolio review, MOLOGEN introduced its new “Next Level” strategy in June 2016. Its aim is the further development of MOLOGEN, shifting the focus of the company from just R&D to a strong product and market orientation, with a particular spotlight on the TLR9 product family with the lead product candidate lefitolimod. The company’s primary objective is the out-licensing of lefitolimod. Accordingly, the principal focus is on the four clinical trials with lefitolimod that are being conducted at present: IMPALA, IMPULSE and TEACH in the indications colorectal cancer, small-cell lung cancer and HIV as well as the combination study with the immunotherapy Yervoy® (ipilimumab) in patients with advanced solid tumors.
In 2016, considerable progress was made in terms of patient recruitment for the phase III IMPALA pivotal study. Around 540 patients from approximately 120 centers in eight European countries, including the five largest European pharmaceutical markets, will participate in the study. The intention is to complete patient recruitment in the first few months of 2017. The evaluation of the study is expected to begin around two years after the end of patient enrollment.
Patient recruitment for the phase II IMPULSE trial was already concluded in October 2015. At the end of 2016, the analysis of one-year survival rate in the indication of small-cell lung cancer commenced. The initial results of this exploratory study, which investigates the possible treatment success in different patient sub-groups, are expected to be ready in the second quarter of 2017. The results of the follow-up analysis of patients (two-year survival rate) according to protocol will be available in around one year.
MOLOGEN is working together with the Danish Aarhus University Hospital to conduct the phase I/II TEACH study, which is the first time that lefitolimod is being clinically evaluated in patients with a disease other than cancer: HIV. Owing to the favorable results in the first phase of the study, in which a broad activation of the immune system triggered by lefitolimod was observed, the decision was made to continue the study in an extension phase where patients would receive treatment over a longer time frame. Patient recruitment started in June 2016 and the first study results are expected presumably in the middle of 2017. In February of this year, Aarhus University presented further data from the TEACH study, which revealed through colon biopsies that lefitolimod can trigger a local antiviral immune response in patients with HIV who undergo antiretroviral treatment (ART) without inducing inflammation. Consequently, lefitolimod might be used in a “kick and kill” approach.
The U.S. biopharmaceutical company Gilead Sciences, Inc. recently issued a grant of US$ 2.75 million to Aarhus University for a further combination study in which lefitolimod will be investigated together with innovative virus-neutralizing antibodies that have been developed by the Rockefeller University in New York, USA. This innovative combination will be the latest approach in the “kick and kill” concept for the treatment of HIV.
First positive results from combination study with lefitolimod – expansion of application spectrum
For the first combination study of lefitolimod with the checkpoint inhibitor Yervoy® (ipilimumab), which MOLOGEN is carrying out in cooperation with the MD Anderson Cancer Center, Texas, patient recruitment started in July 2016. Through the combination of these two immunotherapies, the aim is to generate a broader activation of the immune system and synergy effects.
In January of this year, MOLOGEN presented data on further combination studies in a mouse model at the Gastrointestinal Cancers Symposium (ASCO GI) in San Francisco, USA. The data on tumor models in mice revealed that the combination of checkpoint inhibitors and lefitolimod can significantly boost immunity, noticeably slow tumor growth and effectively prolong life for the animals. These findings confirm the combination approach of lefitolimod with checkpoint inhibitors.
Slight increase in R&D expenses
Overall, the financial performance and financial position of MOLOGEN AG developed according to plan in 2016. As in previous years, the company has no revenue to report. Despite the ongoing advancement of clinical studies, expenses for research and development only increased slightly year on year to €17.0 million (2015: €16.8 million) and the operating result (EBIT) was consequently down on the previous year to €-21.0 million (2015: €-20.5 million). Taking into account the successfully completed capital measures generating gross proceeds of €16.1 million, the cash and cash equivalents of MOLOGEN AG totaled €20.5 million as of 31 December 2016 (2015: €24.6 million) The shareholder’s equity of MOLOGEN AG as of year-end 2016 amounted to €11.8 million (2015: €19.5 million). The equity ratio was 55% (2015: 74%).
Sound basis for continued positive development in 2017
The successful further development of the product pipeline, the specification and start of implementation of the “Next Level” Group strategy in fiscal year 2016 and the available financial means provide a good foundation for the continued positive development of MOLOGEN AG. The progress planned for 2017 in pre-clinical and clinical development programs as well as in the out-licensing of lefitolimod should all further increase the value of the product pipeline and the company.
The financial prerequisites for the scheduled development of the company in 2017 have been established through the capital increase in 2016 and the two subsequently placed convertible bonds. MOLOGEN therefore enters the new financial year with good prospects. The development of the financial performance and financial position of MOLOGEN in fiscal year 2017 above all depends on the continued progress of the clinical studies with the lead product candidate lefitolimod as well as the associated out-licensing and partnership efforts. The necessary expenditure in the area of clinical development is expected to be up on those in fiscal year 2016. This is essentially due to the continuation of the IMPALA clinical study, the outsourcing and upscaling of production as well as further activities in licensing and partnerships in relation to lefitolimod. According to our forecast, average monthly cash consumption will increase year on year in 2017. If the present licensing and partnership discussions are successful in 2017, this could have a notable positive impact on the financial performance and financial position.
The 2016 Annual Report of MOLOGEN AG is available on the company's website at: www.mologen.com.
As a biopharmaceutical company, MOLOGEN AG is considered a pioneer in the field of immunotherapies on account of its unique compounds and technologies. Alongside a focus on immuno-oncology, MOLOGEN develops immunotherapies for the treatment of infectious diseases.
The immunotherapy lefitolimod is the company’s lead product and the best-in-class TLR9 agonist. Treatment with lefitolimod triggers a broad and strong activation of the immune system. On account of this action mechanism, lefitolimod is an immune surveillance reactivator (ISR) and has the potential to be used in a variety of different indications. At present, ISR lefitolimod is being developed for first-line maintenance treatment of colorectal cancer (pivotal study) and small-cell lung cancer (randomized controlled study). In addition, ISR lefitolimod is currently being investigated in an extended phase I trial in HIV and a phase I combination study with the checkpoint inhibitor Yervoy® (ipilimumab). Alongside checkpoint inhibitors, lefitolimod is one of the few product candidates in the field of immuno-oncology which is close to market. It is currently in a clinical phase III pivotal study. MOLOGEN’s pipeline focus is on new innovative immunotherapies to treat diseases for which there is a great medical demand.
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Biotechnologieverbund Berlin-Brandenburg (bbb) e.V. | BIO Deutschland e.V. | DECHEMA – Gesellschaft für Chemische Technik und Biotechnologie e.V. | Deutsche Industrievereinigung Biotechnologie (DIB) | Stifterverband für die Deutsche Wissenschaft e.V. | Vereinigung deutscher Biotechnologie-Unternehmen (VBU) | Verband Forschender Arzneimittelhersteller e.V. (VFA) | Verband der Chemischen Industrie e.V. (VCI)
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