TORONTO, March 31, 2014 /CNW/ - Amorfix Life Sciences, a product development company focused on diagnostics and therapeutics for misfolded protein diseases, today announced its operational and financial results for the three and nine month period ended December 31, 2014.
"Recently the Company made the decision to close its research facility in Mississauga, Ontario and initiate a review of strategic alternatives to further develop its neuro-biological assets and other research and development programs", said Amorfix CEO Dr. Robert Gundel. "The management team and the Board of Directors are fully engaged in this effort to identify the best path forward for the Company to maximize long-term shareholder value".
Annual Highlights and Recent Developments:
- On January 12, 2015, the Company announced that it is closing its operations in Mississauga, Ontario during the first quarter of fiscal 2015 and that it planned to relocate operations to South San Francisco once new investment funds are received.
- On March 16, 2015 the Company announced that its Board of Directors has formally authorized the Company to review all strategic alternatives available to it. The Company's management has been charged, among other things, with the responsibility for exploring alternative ways to maximize shareholder value, including transactions involving the sale of all or part of the assets of the Company. The Company had numerous discussions with potential investors in recent months, many of whom ultimately declined to invest based on a variety of factors, citing a reluctance to invest in a public biotechnology company at an early stage of the Company's progress toward clinical trials, among other reasons. The Board of Directors will consider any and all strategic proposals, including proposals that would transfer the Company's assets into a privately held entity in such a manner that would provide the Company and its shareholders with a continuing equity stake in the private entity's business, although the Board of Directors has not ruled out any strategic alternatives at this stage.
- In April 2014, the Company completed a non-brokered private placement through the issuance of 3,320,333 common shares of Amorfix (Shares) and 3,320,333 Warrants for gross proceeds of $996,100. In conjunction with the offering, the Company paid $40,016 in finder fees and issued 133,385 finder warrants which have the same terms as the Warrants.
- On July 16, 2014, the Company announced that it has been issued a broad patent covering antibodies that target misfolded SOD1 (mSOD1) for the treatment of ALS by the U.S. Patent and Trademark Office. This patent provides very broad patent protection for the Company's ALS therapeutic antibody product portfolio and puts Amorfix in a controlling position for commercialization of antibodies that target misfolded SOD1.
- On July 17, 2014, the Company announced that its EP-AD diagnostic assay for the early detection of Alzheimer's disease can now measure aggregated Aβ42 separately from aggregated Aβ40 in patient cerebrospinal fluid (CSF), greatly expanding the utility of the diagnostic assay. The ability to distinguish one form of the aggregated protein from another will help advance the scientific understanding of the role of aggregates in Alzheimer's disease progression and improve the targeting of new therapies to patients who are more likely to show therapeutic benefit.
- On October 21, 2014 the Company announced that it would get the rights back for development and commercialization of the ALS antibody therapeutics originally licensed to Biogen-Idec effective January 14, 2015.
Annual Results of Operations
Effective October 3, 2014 the Company changed its fiscal year end from March 31 to December 31. As a result of that change the current period is for the nine-month period ended December 31, 2014 while the prior year comparative period is for the twelve months ended March 31, 2014 and therefore is not directly comparable to the current nine month period.
Since inception, the Company has incurred losses while advancing the research and development of its diagnostic and therapeutic technologies. The net loss for the nine-month period ended December 31, 2014 was $2,141,439 as compared to the net loss of $2,253,341 for the year ended March 31, 2014.
For the nine month period ended December 31, 2014 revenue from services and sales was $48,205 as compared to $139,968 in the comparative period. Revenue for both periods related mostly to the Company's EP-AD diagnostic test. In addition, through a research collaboration, the Company recognized $209,578 in contract research revenue for the nine-month period ended December 31, 2014 as compared to $8,354 for the year ended March 31, 2014. This research project is now completed and no further revenue will be recognized related to this collaboration.
Research and development expenses for the nine-month period ended December 31, 2014 were $1,318,294 as compared to $1,408,961 in the year ended March 31, 2014. The decrease results from comparing a 9 month period vs a 12 month period. Annualizing the expenses for the 9 month period ended December 31, 2014 to make it comparable to the year ended March 31, 2014 results in an increase in expenditures related mostly to higher expenses on its cancer therapeutics and AD diagnostic research programs.
General and administrative expenses for the nine month period ended December 31, 2014 were $1,080,928 compared to $992,702 in the year ended March 31, 2014. The increase in annualized expenditures for the nine month period ended December 31 2014 to the year ended March 31, 2014 related mostly to higher consulting fees and higher stock-based compensation.
Results of Operations – Three months ended December 31, 2014 and 2013
The net loss for the three months ended December 31, 2014 was $521,617 compared to a net loss of $435,713 for the three months ended December 31, 2013. The increased net loss in the current period results mainly from higher professional fees and higher program fees for its Alzheimer's disease diagnostic program.
For the three months ended December 31, 2014 contract research revenue was $63,092. There was no research revenue in the comparable period. Sales and service revenue were $646 in the current period as compared with $35,590 in the comparable period.
Research and development expenses for the three months ended December 31, 2014 were $355,916 as compared to $295,832 in the three month ended December 31, 2013. The increase in expenditures in the current period related mostly to higher expenditures on its Alzheimer's disease diagnostic program, higher salaries and travel expenses, offset by lower stock option compensation.
General and administrative expenses for the three months ended December 31, 2014 were $229,439 as compared to $175,471 in the three months ended December 31, 2013. The increase in expenditures in the current period resulted mainly from higher professional fees expense offset by lower stock option compensation.
The Company incurred a loss of $2,141,439 for the nine month-period ended December 31, 2014 and has a deficit of $36,426,344 as at December 31, 2014, and as at December 31, 2014, had working capital deficiency of $286,786. At present, the Company's cash resources are expected to be fully depleted imminently. These circumstances may cast significant doubt as to the ability of the Company to continue as a going concern. The Company is actively pursuing financing and strategic alternatives to further develop certain of the Company's scientific initiatives, but there is no assurance that these initiatives will be successful, timely or sufficient.
The Company intends to continue to maintain its core neurodegenerative disease assets for ALS and Alzheimer's disease until one or more strategic transactions are consummated. For ALS, these assets include therapeutic antibodies that block misfolded SOD1 and a simple blood test diagnostic for early detection of the disease. For Alzheimer's disease, the company has developed a 'best in class' diagnostic that can accurately identify patients with early-stage disease.
No timetable has been set for the Company's process for reviewing strategic alternatives. No decision has been made to enter into any transaction at this time, and there can be no assurance that the Company will enter into such a transaction in the future. Such a transaction, if one were to occur, could require formal shareholder approval, in which case detailed proxy or other solicitation material would be made available to shareholders. There is no assurance that this strategic alternatives review will result in Amorfix changing its current business plan, pursuing a particular transaction, or completing any such transaction.
The Company currently intends to retain its listing as a public company on the TSX unless a so-called "going-private transaction" or any other strategic alternative is consummated. There can be no assurance that any such transaction will be consummated.
Additional information about the Company, including the MD&A and financial results may be found on SEDAR at www.sedar.com.
Amorfix Life Sciences Ltd. (TSX:AMF) is an early-stage product development company developing therapeutic antibodies and diagnostics targeting misfolded protein diseases. Amorfix utilizes its computational discovery platform, ProMIS™, to predict novel Disease Specific Epitopes (DSEs) on the molecular surface of misfolded proteins. Using this technology, Amorfix is developing novel antibody therapeutics and companion diagnostics for cancer and amyotrophic lateral sclerosis (ALS). In addition, Amorfix has developed two proprietary technologies to specifically identify very low levels of misfolded proteins in a biological sample: Epitope Protection™ and AMFIA™, an ultra-sensitive dual-bead immunoassay. Use of these technologies has generated a cerebrospinal fluid (CSF) screening test for both Alzheimer's disease (AD) and mild cognitive impairment (MCI), and an ultrasensitive method for detecting the hallmark of AD, aggregated beta-Amyloid, in brain tissue, CSF and blood from animal models of AD. For more information about Amorfix, visit www.amorfix.com.
The TSX has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. This information release may contain certain forward-looking information. Such information involves known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by statements herein, and therefore these statements should not be read as guarantees of future performance or results. All forward-looking statements are based on the Company's current beliefs as well as assumptions made by and information currently available to it as well as other factors. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Due to risks and uncertainties, including the risks and uncertainties identified by the Company in its public securities filings, actual events may differ materially from current expectations. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
SOURCE Amorfix Life Sciences Ltd.
For further information: Dr. Robert Gundel, President and Chief Executive Officer, Amorfix Life Sciences Ltd., Tel: (416) 847-6957, Fax: (416) 847-6899, [email protected]; Warren Whitehead, Chief Financial Officer, Amorfix Life Sciences Ltd., Tel: (416) 644-7358, Fax: (416) 847-6899, [email protected]