BERLIN--(BUSINESS WIRE)--Regulatory News:
NOXXON Pharma N.V. (Paris:ALNOX) (Euronext Growth Paris: ALNOX), the "Company", a biotechnology company focused on improving cancer treatments by targeting the tumor microenvironment (TME), announced its financial results for the fiscal year ending December 31, 2017. The consolidated financial statements for NOXXON Pharma N.V. and its subsidiaries have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU).
Aram Mangasarian, Ph.D., Chief Executive Officer of NOXXON commented: “Our efforts in 2017 were focused on advancing our clinical trial combining NOX-A12 with Merck & Co./MSD’s anti-PD-1 immune checkpoint inhibitor, Keytruda®. I am pleased to report that as of April 20, 2018, 17 out of the planned 20 patients have been recruited and we remain confident that we will have the biopsy data from the NOX-A12 monotherapy part 1 of the study in the second quarter of 2018, and efficacy data from the NOX-A12 Keytruda® combination part 2 of the study in the fourth quarter this year as planned.”
He added: “We have conducted significant outreach to US and EU experts from research hospitals and the industry over the past year. We are encouraged by the interest in our TME-based approach to cancer therapy, especially feedback at conferences such as the American Society Neuro-Oncology, the European Society of Medical Oncology and the American Association of Cancer Research. These interactions have shaped our plans for upcoming trials in lung, brain and pancreatic cancer involving both of our clinical assets, NOX-A12 and NOX-E36."
Jarl Ulf Jungnelius, M.D. Ph.D., Chief Medical Officer of NOXXON commented: “We are excited by the potential of our technology to target both arms of the immune system and the opportunity to demonstrate this in upcoming trials with NOX-A12 addressing on the adaptive immune system and NOX-E36 the innate immune system.”
Business Highlights for 2017
January 2017: NOXXON announced the licensing of preclinical Spiegelmer® programs to Aptarion biotech AG in exchange for cash, royalties and an equity stake in Aptarion.
February 2017: Experienced industry cancer clinician, Jarl Ulf Jungnelius, M.D. Ph.D., increased his involvement with NOXXON to serve as Chief Medical Officer. His prior experience in immuno-oncology and his involvement with the development of two approved therapeutics for pancreatic cancer, one of the indications targeted in the ongoing clinical trial of NOX-A12, is of particular value to the Company.
May 2017: NOXXON secured a private placement of € 1 million and additional financing of up to € 10 million through convertible notes with share subscription warrants attached (ODIRNANE bonds, undated bonds convertible into new shares and/or exchangeable for existing shares and/or redeemable in cash, with BSA, share warrants) to finance further clinical development of NOX-A12.
May 2017: NOXXON announced a collaboration with top clinical center, the National Center for Tumor Diseases, in Heidelberg, Germany, to conduct the NOX-A12/Keytruda® Phase 1/2 combination trial in microsatellite-stable metastatic pancreatic and colorectal cancer patients that do not normally respond to Keytruda® monotherapy.
July 2017: NOXXON announced that the first patients had completed part 1 of the NOX-A12/Keytruda® trial in which they received NOX-A12 monotherapy for two weeks.
July 2017: Following the shift of NOXXON shares to the public offering compartment of Euronext Growth, subscription of the first tranche of convertible notes totaling € 1 million was completed. This triggered the conversion of venture debt into equity, resulting in a remaining venture debt of € 841 thousand, with no cash redemption or interest accruing until September 2018. The last remaining debt may be fully converted into equity upon certain conditions being fulfilled and upon request from the Company.
September 2017: NOXXON issued the second tranche of ODIRNANE bonds totaling € 500 thousand.
September 2017: The ongoing NOX-A12/Keytruda® trial successfully reached the halfway mark of overall enrollment. Initial data showed penetration of NOX-A12 into tumor tissue and confirmed the previously established safety profile of NOX-A12 monotherapy in colorectal and pancreatic cancer patients.
September 2017: The Supervisory Board elected Dr. Don deBethizy, an experienced US and EU biotech veteran as Chairman. Dr. deBethizy joined the NOXXON Board in 2014, providing over 30 years of leadership experience in the biotech and pharma industry and having served as CEO, Chairman and Board member for a number of public and private companies both in the US and EU.
October 2017: NOXXON published preclinical proof-of-concept data for NOX-A12 in combination with checkpoint inhibitors in Cancer Immunology Research. The results from the study entitled “Increasing tumor-infiltrating T cells through inhibition of CXCL12 with NOX-A12 synergizes with PD-1 blockade” highlighted the effects of NOX-A12 in vitro and in an animal model, emphasizing the ability of NOX-A12 to enhance the infiltration of T and NK immune cells into tumor tissue thereby synergizing with and overcoming resistance to PD-1 checkpoint inhibition with the goal of enabling the destruction of cancer cells.
November 2017: NOXXON issued third tranche of ODIRNANE bonds totaling € 500 thousand.
Business Highlights after the end of 2017
January 2018: NOXXON issued fourth tranche of ODIRNANE bonds totaling € 500 thousand.
March 2018: NOXXON renegotiated the ODIRNANE bond financing agreement to remove unilateral option for the investor to subscribe for tranches and to cancel existing warrants. NOXXON issued a fifth tranche or ODIRNANE bonds totaling € 1 million without warrants attached.
March 2018: NOXXON announced convocation of an Extraordinary General Meeting (EGM) of shareholders to authorize the Management and Supervisory Boards to issue additional shares.
April 2018: NOXXON announced the initiation of analyst coverage by Aurgalys Value in both French and English.
2017 Financial Summary
Revenue was € nil for 2017 compared to € 83 thousand for 2016. Research and development expenses decreased by 55% to € 2.4 million (2016: € 5.3 million). The decrease in research and development expenses in 2017 compared to 2016 is mainly due to lower costs for raw materials, consumables, supplies and a production campaign substantially completed in 2016, as well as lower personnel expenses, patent costs and consulting services as a result of the internal restructuring and focus of the Group on its core research and development activities. As a result, personnel expenses decreased by € 1,029 thousand, costs for raw materials, consumables, supplies decreased by € 988 thousand and patent costs and consulting services decreased by € 271 thousand.
Other operating income decreased 40% from € 437 thousand in the Fiscal Year 2016 to € 261 thousand in the Fiscal Year 2017. This decrease was mainly due to income from government grants related to research and development projects of € 3 thousand compared to € 385 thousand in the Fiscal Year 2016 and income from the sale of financial assets and property, plant and equipment of € 12 thousand compared to € 20 thousand in Fiscal Year 2016. This decrease was partly offset by the release in the Fiscal Year 2017 of the financial liability resulting from certain grants.
General and administrative expenses decreased 32% from € 3,780 thousand in the Fiscal Year 2016 to € 2,580 thousand in the Fiscal Year 2017. This decrease in general and administrative expenses is mainly driven by lower legal, consulting and audit expenses (€ 972 thousand) compared to the Fiscal Year 2016 (€ 2,246 thousand) related to the preparation of financing transactions in Fiscal Year 2016. Further, in Fiscal Year 2016 restructuring costs and settlement benefits amounted to € 55 thousand and impairment loss on tangible assets and assets held for sale amounted to € 177 thousand, compared to € nil in Fiscal Year 2017.
Finance income increased from € 1 thousand in the Fiscal Year 2016 to € 1,019 thousand in the Fiscal Year 2017 due to de-recognition of a derivative financial liability in connection with Kreos (€ 419 thousand), a recognition of a derivative financial asset (€ 40 thousand) and fair value adjustments for warrants issued to Yorkville, Kreos and other investors (€ 560 thousand).
Finance cost decreased by 21% from € 2,127 thousand in the Fiscal Year 2016 to € 1,678 thousand in the Fiscal Year 2017. This decrease is due to the interest incurred, applying the effective interest rate method, the modifications of and a debt-for-equity conversion on two venture loans with Kreos entered into in 2014 and 2015 as the Group entered into a series of subsequent agreements related to its loan facilities and share purchase warrants some of which involved a substantial modification of the then outstanding financial liabilities, i.e. to the de-recognition of the related liability and the recognition of the modified liability at its fair value with a related gain or loss being recognized in the income statement in the Fiscal Year 2016. For the Fiscal Year 2017, the Group incurred finance cost of € 666 thousand (prior year € 2,127 thousand), mainly the effects from the aforementioned transactions and interest for financial liabilities relating to Kreos.
Relating to the equity line financing the Group incurred finance costs for the Fiscal Year 2017 of € 973 thousand for the notes issued, transaction costs and the conversions and finance income of € 359 thousand for fair value adjustments of warrants issued to Yorkville (Fiscal Year 2016: € nil). The remaining finance costs of € 39 thousand are mainly related to fair value adjustments of warrants issued to other investors.
As a result of the above factors, the Group’s loss before income tax decreased by 49.8% from € 10,725 thousand in the Fiscal Year 2016 to € 5,389 thousand in the Fiscal Year 2017.
As of December 31, 2017, cash and cash equivalents amounted to € 622 thousand, compared to € 2.2 million at December 31, 2016.
The consolidated financial statements for 2017, approved by the management and supervisory boards on April 30, 2018, are available on NOXXON’s website (www.noxxon.com).
2017 Financial Results
NOXXON’s key financial figures for fiscal year 2017 compared to the same period in 2016 are summarized below:
|[in € thousands]||2017||2016|
|Other operating income||261||437|
|Research and development expenses||(2,410)||(5,327)|
|General and administrative expenses||(2,580)||(3,780)|
|Foreign exchange losses||(1)||(12)|
|Loss from operations||(4,730)||(8,599)|
|Loss before income tax||(5,389)||(10,725)|
|Net loss – attributable to Owners of the Company||(5,385)||(10,747)|
|Net loss – attributable to non-controlling interest||(5)||(5)|
|Loss per share (in €, basic and diluted)||(2.54)||(6.71)|
Based on its present requirements resulting from NOXXON’s updated business plan focusing on clinical development of its lead product candidate NOX-A12 for the treatment of advanced solid tumors, the Group will require additional cash resources of approximately € 3.2 million, to provide the Group with sufficient working capital for the twelve months following the date of these consolidated financial statements.
Management is pursuing various financing alternatives to meet the Group’s future cash requirements, including seeking additional investors, pursuing industrial partnerships, or obtaining further funding from existing investors through additional funding rounds, pursuing a merger or an acquisition. The management of NOXXON is pursuing all of these avenues in parallel with the assistance of experienced outside support. Based on the options available, management is confident to be able to raise additional capital, preferably in the form of equity. No financing commitments were received by the Company as of today.
In 2018, NOXXON expects important news-flow from its ongoing phase 1/2 trial in colorectal and pancreatic tumors with NOX-A12 in combination with Merck & Co./MSD’s anti-PD-1 immune checkpoint inhibitor, Keytruda®. Biopsy data from the NOX-A12 monotherapy part 1 of the study will become available in the second quarter, efficacy data are expected in the fourth quarter of 2018.
In order to conduct all the clinical trials that the Company would like to execute in the coming three years, NOXXON will need significant additional funds.
Planned clinical trials:
- Phase 1/2 NOX-A12 + anti-PD-1 immune checkpoint inhibitor Keytruda® in metastatic microsatellite stable (MSS) pancreatic and colorectal cancer (ongoing);
- Phase 1/2 NOX-A12 + radiotherapy in 1st line MGMT unmethylated (resistant to temodar) incompletely resectable glioblastoma;
- Phase 1/2 NOX-A12 and/or NOX-E36 + anti-PD-1/L1 immune checkpoint inhibitor in non-small-cell lung cancer (NSCLC) patients who have failed anti-PD-1/L1 immune checkpoint inhibitor monotherapy and exhibit potential response biomarkers;
- Phase 1/2 NOX-E36 and/or NOX-A12 in pancreatic cancer in combination with an anti-PD-1/L1 immune checkpoint inhibitor, and/or chemotherapy.
NOXXON’s oncology-focused pipeline acts on the tumor microenvironment (TME) and the cancer immunity cycle by breaking the tumor protection barrier, blocking tumor repair and exposing hidden tumor cells. Through neutralizing chemokines in the tumor microenvironment, NOXXON’s approach works in combination with other forms of treatment to weaken tumor defenses against the immune system and enable greater therapeutic impact. Building on extensive clinical experience and safety data, the lead program NOX-A12 will deliver top-line data from a Keytruda® combination trial in metastatic colorectal and pancreatic cancer patients in 2018. The Company plans to initiate further studies with NOX-A12 in brain cancer in combination with radiotherapy, for which an orphan drug status has been granted in the US and EU. The Company’s second asset, NOX-E36 is a Phase 2 TME asset targeting the innate immune system. NOXXON plans to test NOX-E36 in pancreatic cancer patients both as a monotherapy and in combination. Further information can be found at: www.noxxon.com
Keytruda® is a registered trademark of Merck Sharp & Dohme Corp.
Certain statements in this communication contain formulations or terms referring to the future or future developments, as well as negations of such formulations or terms, or similar terminology. These are described as forward-looking statements. In addition, all information in this communication regarding planned or future results of business segments, financial indicators, developments of the financial situation or other financial or statistical data contains such forward-looking statements. The company cautions prospective investors not to rely on such forward-looking statements as certain prognoses of actual future events and developments. The company is neither responsible nor liable for updating such information, which only represents the state of affairs on the day of publication.