Amorfix announces third quarter 2010 results

TSX: AMF

TORONTO , Feb. 8 /CNW/ - Amorfix Life Sciences, a company focused on focused on treatments and diagnostics for misfolded protein diseases, today reported its third quarter operating results and provided an update on the Company's diagnostic and therapeutic programs.

"We have created a broad development pipeline of 3 diagnostic products and 3 therapeutic products and have demonstrated our leadership in the misfolded protein space," said Dr. George Adams , CEO of Amorfix. "We have achieved our first revenue on our novel Alzheimer's diagnostic test, and continue to leverage our expertise across all programs to introduce novel diagnostic and therapeutic solutions to misfolded protein diseases."

    
    Development and Corporate Highlights

    vCJD
    ----

        -  In December 2009, the Company announced that NIBSC provided three
           plasma samples from three different vCJD patients which the
           Company tested using the first generation of the EP-vCJD(TM) test.
           The samples tested negative and the UK authorities have concluded
           that the first generation test is not sufficiently sensitive to
           detect infected human blood samples. The Company continues
           development activities to improve the sensitivity of its
           EP-vCJD(TM) blood screening test and the 2nd generation test is
           now able to detect a 1:5,000,000 dilution of vCJD infected brain
           spiked into blood samples. This level of sensitivity is fifty
           times the minimum analytical sensitivity required by the
           UK authorities to continue evaluation of the assay. A recent
           modification may provide a third generation blood test with even
           greater sensitivity. NIBSC has agreed to enter an improved
           EP-vCJD(TM) test into the program to test clinical-stage vCJD
           samples when validated using infected animal samples and shown to
           meet the NIBSC requirement for specificity.

    ALS/Alzheimer's Disease (AD)
    ---------------------------

        -  In December 2009, the Company announced that it is conducting
           pilot studies with its A4 assay with several pharmaceutical
           companies engaged in developing new treatments for AD and one
           company has publicly announced their results verifying their novel
           drug's ability to reduce amyloid formation in animal models of AD.

        -  In December 2009, the Company recorded its first revenues for its
           A4 AD assay. The Company is aggressively marketing this service to
           AD researchers worldwide.

        -  The SOD1 antibody and vaccine preclinical treatment studies in AD
           continue on schedule with the first series of experiments expected
           to be complete in the first quarter of calendar 2010.

        -  The Company is engaged in discussions with partners for its
           antibodies and vaccines to misfolded SOD1 for use in ALS disease.

    Cancer
    ------

        -  The Company has selected four proteins for study and using
           ProMIS(TM) has determined a total of 39 Disease Specific Epitopes
           (DSE) sites on these four protein targets. Recent studies with a
           monoclonal antibody to an undisclosed DSE site on one of the four
           selected proteins confirmed that the misfolded protein is present
           on lymphomas and melanoma cells but not on normal cells. The
           antibody targets a specific DSE region of the misfolded protein
           that is not present on the normally folded protein. This new
           finding indicates that the antibody has potential to be developed
           for both diagnostic uses and therapeutic treatments for several
           cancers.

        -  Amorfix has completed the development of a prototype test for
           early detection of hepatocellular carcinoma or primary liver
           cancer and will now start testing clinical samples to determine
           sensitivity and specificity.
    

Financial Results

For the three months ended December 31, 2009 the Company reported a net loss of $1,149,932 ( $0.02 per share) compared to a net loss of $1,017,663 ( $0.02 per share) for the comparable period last year. For the nine months ended December 31, 2009 the Company reported a net loss of $3,607,578 ( $0.08 per share) compared to a net loss of $3,771,794 ( $0.09 per share) for the nine months ended December 31, 2008 .

The Company recorded its first service revenue from the A4 test and also recorded revenue related to a third party research agreement totalling $44,911 .

Research and development expenditures for the three months ended December 31, 2009 were $935,439 compared to $804,871 for the three months ended December 31, 2008 and for the nine months ended December 31, 3009 were $2,794,672 compared to $3,062,552 for the comparable period last year. Research and development expenses increased in the three months ended December 31, 2009 due to higher program expenses on its vCJD and AD diagnostic research program. Research and development expenses decreased for the nine months ended December 31, 2009 due to lower staffing costs, and lower vCJD, AD diagnostic and ALS therapeutic program expenses partially offset by expenditures related to its new ProMIS(TM) program.

General and administration costs for the three months ended December 31, 2009 were $247,093 compared to $199,922 for the three months ended December 31, 2008 and for the nine months ended December 31, 2009 were $844,660 compared to $717,360 in the comparable period last year. Higher expenses for the three and nine months ended December 31, 2009 resulted mainly from higher stock-based compensation and shareholder communication expenses.

Cash burn (cash used in operating activities) for the three months ended December 31, 2009 was $915,709 as compared to $809,588 for the three months ended December 31, 2008 . The increased cash burn in the three-month period ended December 31, 2009 was due primarily to higher research and development and operating costs. The cash burn for the nine months ended December 31, 2009 was $2,842,559 compared to $3,528,076 for the nine months ended December 31, 2008 . The decreased cash burn in the nine month period ended December 31, 2009 was due primarily to lower research and development and operating costs and a higher amount of accounts payable that was paid out in the nine months ended December 31, 2008 .

As at December 31, 2009 Amorfix had working capital of $5,353,561 compared to $4,458,065 as at March 31, 2009 .

As at December 31, 2009 the Company had 48,510,418 common shares outstanding.

Outlook

    

    The Company's fiscal 2010 diagnostic priorities are to:

    -   increasing the sensitivity of the EP-vCJD(TM) assay in second and
        third generation versions, while maintaining acceptable specificity;

    -   obtaining vCJD patient samples, samples from high-risk groups, and
        infected animal samples;

    -   form collaborations to further validate the benefits of the A4
        amyloid assay and to grow the service business providing this assay
        for testing preclinical samples; and

    -   complete development of the screening test for liver cancer in
        collaboration with BioMosaics and Sunnybrook Research Institute.

    The company's 2010 therapeutic priorities are to:

    -   advance the ALS vaccine and antibody DSE programs through
        partnerships;

    -   complete proof-of-concept preclinical studies for Alzheimer's Disease
        targeting misfolded SOD1;

    -   leverage the company's core capability of identifying misfolded
        protein targets using our ProMIS(TM) technology, generate antibodies,
        and initiate development and/or partnerships with novel therapeutic
        and diagnostic antibodies.
    

Additional information about the Company, including the MD&A and financial results may be found on SEDAR at www.sedar.com.

About Amorfix

Amorfix Life Sciences Ltd. (TSX:AMF) is a theranostics company developing therapeutic products and diagnostic devices targeting misfolded protein diseases including ALS, Alzheimer's Disease, variant Creutzfeldt-Jakob Disease (vCJD) and Cancer. Amorfix's proprietary Epitope Protection(TM) (EP) technology enables it to specifically identify very low levels of aggregated misfolded proteins (AMP) in a sample of normal protein. Aggregated misfolded proteins are a common element of many brain wasting diseases and the ability to identify AMPs and understand their structure and mechanism of folding are the first steps to developing new treatments for these devastating diseases. Amorfix utilizes its computational discovery platform, ProMIS(TM), to predict novel Disease Specific Epitopes ("DSE") on the molecular surface of misfolded proteins. ProMIS(TM) is an "in silico" rational selection approach that can be applied to any protein where the normal folding structure is at least partially known. Amorfix's lead therapeutic programs include antibodies and vaccines to DSEs in ALS, Alzheimer's disease and Cancer. The Company's diagnostic programs include a blood screening test for diagnosis of vCJD and an ultrasensitive method for the detection of aggregated Beta-Amyloid in brain tissue of animal models of Alzheimer's disease, months prior to plaque formation.

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.

%SEDAR: 00022789E

For further information: Dr. George Adams, President & Chief Executive Officer, Amorfix Life Sciences Ltd., Tel: [phone], Fax: [phone], [email protected]; James Parsons, Chief Financial Officer, Amorfix Life Sciences Ltd., Tel: [phone], Fax: [phone], [email protected]