GeNeuro Reports 2019 Half-Year Results and Provides Corporate Update

  • Cash position of €9.9 million as of June 30, 2019
  • All activities funded through Q3 2020

GENEVA--()--Regulatory News:

GeNeuro (Paris:GNRO) (Euronext Paris: CH0308403085 – GNRO), a biopharmaceutical company developing new treatments for neurological and autoimmune diseases, such as multiple sclerosis (MS) and type-1 diabetes (T1D), today reported its half-year financial results for the period ending June 30, 2019 and provided a corporate update.

Key Financials

On September 24, 2019, the Board of Directors of GeNeuro reviewed and approved the financial statements for the six-month period ended June 30, 2019. The Statutory Auditors have conducted a review of the condensed consolidated interim financial statements. The half-year financial report in French is available in the Investors section on www.geneuro.com.

“GeNeuro continues to make progress in advancing our clinical development program to bring new treatments for neurological and autoimmune diseases to patients,” said Jesús Martin-Garcia, CEO of GeNeuro. “In particular, we are very excited that temelimab has shown a major impact in relapsing-remitting MS in a large-scale clinical trial on key neuroprotection markers known to be linked to disease progression, without affecting the immune system. We continue to have constructive discussions on partnering our product for the next step of its development in progressive MS without active inflammation as a single agent, or synergistically with existing anti-inflammation MS drugs. Furthermore, results from a six-month extension of the temelimab Phase 2a study in type-1 Diabetes (T1D) open the door to further development in early-onset T1D pediatric patient population. Our cash position provides financial visibility to cover all our currently planned activities.”

“The financial results for the first half of 2019 are wholly in line with our expectations. As we mentioned previously, upon completion of our CHANGE-MS Phase 2b clinical trial in multiple sclerosis last year, the balance of the milestone payments received from our development partner was recognized as income in 2018 and no income was to be recorded in 2019. The completion of this study and of other smaller studies in H1 2019 (a Phase 1 high dose pharmacology study and the six-month extension of our T1D clinical trial) have led to a 65% reduction of our R&D expenses over the same period last year. The open-label extension ANGEL-MS study, which was also completed during H1 2019, helped further control R&D spending as it was fully funded by our development partner. Overall, in spite of a sharp reduction in our operating costs, the absence of income recognition has led to our operating loss increasing to €4.3 million in the first half of 2019 compared to €2.4 million in the same period of last year. Both this loss and the cash burn for H1 2019, down 33% from the same period of last year, are in line with our expectations” said Miguel Payró, Chief Financial Officer at GeNeuro. “We have also continued to tightly control our general and administrative expenses, which have decreased by €0.5 million, or 23%.”

GENEURO
Condensed Consolidated Income Statement
(in thousands of EUR)

June 30, 2019
6 months
subject to a
limited review

June 30, 2018 6 months
subject to a
limited review

Income

-

7,348

Research & Development expenses

(2,535)

(7,491)

R&D expenses

(3,026)

(8,585)

Subsidies

491

1,094

General & administrative expenses

(1,796)

(2,319)

Other income

12

33

Operating loss

(4,319)

(2,429)

Net loss for the period

(4,469)

(2,337)

 

Basic loss per share (EUR)

(0.31)

(0.16)

Diluted loss per share (EUR)

(0.31)

(0.16)

 

 

 

Cash outflow from operations

(6,201)

(9,223)

Cash at period end

9,992

17,315

 

 

 

No Income was recognized during H1 2019, vs. €7.3 million for the same period of last year, as the Company had accounted in H1 2018 for the balance of the milestone payments it received from its development partner following the successful completion of its CHANGE-MS Phase 2b clinical trial.

Research & Development expenses decreased markedly compared to the first half of 2018. Before subsidies (research tax credits), R&D expenses decreased by €5 million, or 65%, reflecting the completion of the CHANGE-MS clinical trial during H1 2018 and the completion during H1 2019 of the T1D trial and the Phase 1c trial testing the safety of higher doses of temelimab (GNbAC1). Costs of clinical trials dropped by €4.9 million, while all other R&D costs were stable or down, notably personnel expenses which decreased from €1.8 million to €1.2 million as a result of non-replaced departures and lower variable compensation.

General and administrative expenses also declined from €2.3 million in H1 2018 to €1.8 million in H1 2019, thanks to continued cost containment efforts. Administrative personnel expenses were down from €1 million to €0.88 million, due to non-replaced retirement of staff and to lower variable compensation; all cost categories decreased except for amortization and depreciation which increased by €64 thousands due to the implementation of the IFRS 16 “Leases” standard as of January 1, 2019, with a corresponding decrease in rental expenses. Share-based payments moved from a charge of €197 thousands to a credit of €6 thousands as a result of the final determination of the Company’s share option plans, resulting in a lower number of options being granted than previously estimated.

The Company recorded a net loss of €4.5 million vs. €2.3 million in H1 2018, in line with management’s expectations.

Cash and cash equivalents at June 30, 2019 amounted to €9.9 million compared to €9.0 million at December 31, 2018, the increase being due to the full draw-down of the €7.5 million credit facility granted by the Company’s shareholder, GNEH SAS (a subsidiary of Institut Mérieux), which more than offset the cash used in operations of €6.5 million. Cash used in operations during H1 2019 was €6.2 million compared to €9.2 million in the prior year, a reduction of 33%.

Business and Financial Outlook

GeNeuro continues to execute on its business strategy. In March 2019, it published the 96-week results of its extension Phase 2b clinical trial, ANGEL-MS, showing that the 18mg/kg dose of temelimab (GNbAC1) continued to have remarkably consistent benefits over all other groups on key MRI measures linked to MS disease progression; thus confirming and extending the results of CHANGE-MS at Week 48. The 18mg/kg treatment arm also showed lower probability for 12-week confirmed disability progression (Survival Wilcoxon test p=0.34), whilst the 25-foot timed-walk test also showed remarkable stability for the 18mg/kg cohort, with only 2.4% of patients worsening more than 20% over two years (p=0.03). While these clinical measures are very encouraging, the limited size and relapsing nature of the cohort for clinical progression measures does not allow for definitive conclusions. At the same time, temelimab continued to show an excellent safety and tolerability profile throughout. As a result, temelimab offers promise to treat non-active progressive patients and could have potential synergies with existing anti-inflammatory drugs in relapsing MS patients. These results were presented at the ECTRIMS 2019 meeting held 11-13 September 2019 in Stockholm, Sweden.

For the first time, a therapy has successfully demonstrated a major impact in a large-scale clinical trial on key neuroprotection markers known to be linked to disease progression, without affecting the patients’ immune system. The results were achieved solely by neutralizing a pathogenic protein produced by patients, called pHERV-W Env, demonstrating its causal role in neurodegeneration. GeNeuro is continuing its constructive partnership discussions about the next steps in the development of temelimab as a single agent in patients suffering from progressive MS without active inflammation, or synergistically with existing anti-inflammation MS drugs.

In May 2019, the Company also announced the results from the six-month extension of its Phase 2a study of temelimab in T1D confirmed all previously-observed positive observations in the trial, meeting its primary objective. GeNeuro believes these data open the door to further development in early-onset T1D pediatric patient population.

The Company’s cash provides it with financial visibility until Q3 2020 covering all planned activities, which include the partnership discussions and the ALS pre-clinical program.

About GeNeuro

GeNeuro‘s mission is to develop safe and effective treatments against neurological disorders and autoimmune diseases, such as multiple sclerosis or type-1 diabetes, by neutralizing causal factors encoded by HERVs, which represent 8% of human DNA.

GeNeuro is based in Geneva, Switzerland and has R&D facilities in Lyon, France. It has 24 employees and rights to 17 patent families protecting its technology.

For more information, visit: www.geneuro.com.

Disclaimer

This press release contains certain forward - looking statements and estimates concerning GeNeuro’s financial condition, operating results, strategy, projects and future performance and the markets in which it operates. Such forward-looking statements and estimates may be identified by words such as “anticipate,” “believe,” “can,” “could,” “estimate,” “expect,” “intend,” “is designed to,” “may,” “might,” “plan,” “potential,” “predict,” “objective,” “should,” or the negative of these and similar expressions. They incorporate all topics that are not historical facts. Forward looking statements, forecasts and estimates are based on management’s current assumptions and assessment of risks, uncertainties and other factors, known and unknown, which were deemed to be reasonable at the time they were made but which may turn out to be incorrect. Events and outcomes are difficult to predict and depend on factors beyond the Company’s control. Consequently, the actual results, financial condition, performances and/or achievements of GeNeuro or of the industry may turn out to differ materially from the future results, performances or achievements expressed or implied by these statements, forecasts and estimates. Owing to these uncertainties, no representation is made as to the correctness or fairness of these forward-looking statements, forecasts and estimates. Furthermore, forward-looking statements, forecasts and estimates speak only as of the date on which they are made, and GeNeuro undertakes no obligation to update or revise any of them, whether as a result of new information, future events or otherwise, except as required by law.

Contacts

GeNeuro
Jesús Martin-Garcia
Chairman and CEO
+41 22 552 48 00
investors@geneuro.com

NewCap (France)
Investor Relations –
Mathilde Bohin / Louis-Victor Delouvrier
+33 1 44 71 98 52

Media Relations –
Arthur Rouillé
+33 1 44 71 94 98
geneuro@newcap.eu

Halsin Partners
Media Relations –
Mike Sinclair
+44 20 7318 2955
msinclair@halsin.com

LifeSci Advisors
Investor Relations –
Chris Maggos
+41 79 367 6254
chris@lifesciadvisors.com

Contacts

GeNeuro
Jesús Martin-Garcia
Chairman and CEO
+41 22 552 48 00
investors@geneuro.com

NewCap (France)
Investor Relations –
Mathilde Bohin / Louis-Victor Delouvrier
+33 1 44 71 98 52

Media Relations –
Arthur Rouillé
+33 1 44 71 94 98
geneuro@newcap.eu

Halsin Partners
Media Relations –
Mike Sinclair
+44 20 7318 2955
msinclair@halsin.com

LifeSci Advisors
Investor Relations –
Chris Maggos
+41 79 367 6254
chris@lifesciadvisors.com