Company Plans Expansion of Study to Japan
LAVAL, QC, Feb. 22, 2012 /CNW Telbec/ - BELLUS Health Inc. (TSX: BLU) ("BELLUS Health" or the "Company") reported today its financial results for the year ended December 31, 2011, and provided an update on its pipeline of products.
- Japanese Pharmaceutical and Medical Device Agency (PMDA-Japan) has accepted sponsor's proposal to expand the KIACTA™ phase 3 confirmatory trial to Japan;
- Continued enrolment of patients in the KIACTA™ phase 3 registration trial;
- Turned VIVIMIND™ business cash-flow positive in 2011;
- Further expanded VIVIMIND™'s marketing and sales network through license agreements in new markets;
- Completed phase 1 trial of NRM8499: the compound was found to be safe and well tolerated at the intended therapeutic dose;
- Completed several strategic initiatives that reduced use of cash and extended the Company's financial resources to mid-2013.
"During 2011, BELLUS Health continued to execute on its business plan, making significant progress on several fronts," said Roberto Bellini, President and Chief Executive Officer of BELLUS Health. "In particular, the expansion of the KIACTA™ phase 3 registration trial to Japan is an important milestone for the Company and now positions KIACTA™ for marketing approval in the three major global pharma markets, the United States, Europe and Japan, on completion of the phase 3 study," Mr. Bellini added.
KIACTA™ (eprodisate) for the treatment of AA amyloidosis - During 2011, BELLUS Health and its strategic partner Celtic Therapeutics ("Celtic") continued the patient recruitment for the global phase 3 confirmatory clinical trial for KIACTA™ (eprodisate). The trial is designed to confirm the safety and efficacy of KIACTA™ in preventing renal function decline in patients diagnosed with AA amyloidosis. The international, randomized, double-blind, placebo-controlled, event-driven study will involve approximately 230 patients diagnosed with AA amyloidosis recruited from 83 sites in 28 countries worldwide, including those in Japan. Thus far, a total of 72 clinical centers in 26 countries are actively recruiting patients. The Japanese portion of the study is scheduled to enroll 10-20 patients in up to seven clinical centers. These sites are expected to be activated in the second half of 2012 and will recruit patients for at least one year. Recruitment is ongoing and is expected to be completed in the second half of 2013.
The phase 3 confirmatory study is an event-driven trial which will conclude when 120 patients have reached worsening events linked to deterioration of kidney function. Further to the expansion of the study to Japan and the extension of the recruitment period, the completion of the study is now expected in the second half of 2015.
There will be periodic data safety monitoring review boards that will independently assess the safety of KIACTA™ (eprodisate) throughout the study. The first such monitoring review board is scheduled to convene in April 2012. No efficacy interim analysis will be performed.
KIACTA™ (eprodisate) has been granted Orphan Drug Designation in the United States and received Orphan Medicinal Product designation in Europe, which normally provide for market exclusivity of seven years and ten years, respectively, once the drug is approved. KIACTA™ (eprodisate) has also received Orphan Drug Designation in Switzerland.
VIVIMIND™, a natural health product designed to protect memory function - Following the agreements entered into in 2010 relating to the distribution of VIVIMIND™ in Italy with FB Health LLC ("FB Health"), and the exclusive license and supply agreement for the distribution of VIVIMIND™ in Canada with Advanced Orthomolecular Research Inc. ("AOR"), the Company entered into an exclusive license and distribution agreement with Agahan Ayandeye Pars Inc. ("Agahan Group") in 2011 for the rights to VIVIMIND™ in Egypt, United Arab Emirates, Pakistan, Iran and certain other Gulf states. The Agahan Group expects to launch VIVIMIND™ in the first half of 2012. The Company also entered into an exclusive license and distribution agreement with Integris Pharma Ltd. (Integris) in 2011, who has secured the exclusive right to market and sell VIVIMIND™ in Greece and Cyprus. Integris expects to launch VIVIMIND™ in Greece and Cyprus in the middle of 2012.
The Company is actively pursuing additional partnerships in order to further expand VIVIMIND™'s commercial footprint throughout the world.
NRM8499, a prodrug of tramiprosate for the treatment of Alzheimer's disease - In January 2011, BELLUS Health announced the results of the phase I clinical trial for NRM8499, which investigated the safety, tolerability and pharmacokinetic profile of NRM8499 as compared to tramiprosate in a group of 67 young and elderly healthy subjects. The phase I clinical trial data demonstrated that NRM8499 was safe and well tolerated at the intended therapeutic dose. Moreover, the gastrointestinal tolerability and pharmacokinetic profile of tramiprosate were meaningfully improved with NRM8499. The Company is currently exploring strategic partnership opportunities with the aim of further pursuing the development process of NRM8499.
Strategic Cost Reduction Initiatives
Since the second quarter of 2010, the Company has been implementing costs reduction initiatives to reduce its fixed-cost base and extend its financial resources. These included the reduction of the Company's head count by more than 75%; the early termination of the lease agreement for the Company's Laval, Quebec premises; and the reorganization of its international structure. As a result, the Company has significantly reduced its required cash outflows.
In early 2011, the Company exercised its right to terminate the lease of its Laval, Quebec premises as of April 7, 2011, as provided in the amended lease agreement dated March 31, 2009, with A.R.E. Quebec No. 2, Inc., the landlord of such premises. The early termination of the lease resulted in annual savings of approximately $4.5 million for the Company, representing a total of approximately $43 million in aggregate savings over the remainder of the original lease term. The Company has signed a new lease that began on April 8, 2011, at the same premises, for less space.
In 2011, BELLUS Health completed a corporate reorganization whereby the Company streamlined its international structure by liquidating its subsidiaries in Europe and the United States. The reorganization resulted in the repatriation of BELLUS Health's intellectual property to Canada and the reduction of the Company's operating expenses by approximately $1.4 million per year.
All currency figures reported in this press release, including comparative figures, are in CDN dollars, unless otherwise specified.
For the year ended December 31, 2011, net income amounted to $3,424,000 ($0.01 per share), compared to a net loss of $24,553,000 ($0.12 per share) for the same period last year. For the fourth quarter ended December 31, 2011, the Company recorded a net loss of $2,223,000 ($0.01 per share), compared to $12,739,000 ($0.06 per share) for the corresponding quarter the previous year.
The increase in net income/decrease in net loss in the current periods, compared to the corresponding periods the previous year, is partly due to cost reduction initiatives implemented by the Company during the past years, such as reducing its workforce, amending and early terminating its lease agreement and streamlining its international structure. In addition, net income for the year ended December 31, 2011, includes finance income of $13,105,000 recorded in relation to the decrease in the fair value of the embedded conversion option liability on the 2009 Notes, compared to finance costs of $5,904,000 for the corresponding period in 2010. Net loss for the fourth quarter ended December 31, 2011, includes finance costs of $243,000 in relation to the increase in the fair value of the embedded conversion option liability on the 2009 Notes, compared to finance costs of $9,405,000 for the corresponding period in 2010.
As at December 31, 2011, the Company had available cash and cash equivalents of $5,105,000, compared to $10,257,000 as at December 31, 2010. For the year ended December 31, 2011, net decrease in cash and cash equivalents amounted to $5,152,000, compared to $3,760,000 for the corresponding period the previous year. The net decrease in 2010 is net of proceeds of $10.2 million received in relation to the KIACTA™ asset sale and license agreement entered into with Celtic in 2010. Excluding this cash inflow, net decrease in cash used compared to last year is attributable to cost reduction initiatives implemented by the Company, as discussed previously.
The Company's consolidated financial statements and accompanying Management's Discussion and Analysis for the year ended December 31, 2011, will be available shortly on SEDAR at www.sedar.com and on the Company's web site at www.bellushealth.com.
As at December 31, 2011, based on current estimates, the Company's cash and cash equivalents on hand and expected sources of funds are considered, in management's view, to be sufficient to meet its committed cash obligations and expected level of expenditures into the third quarter of 2013. Beyond that, the ability of the Company to continue as a going concern is dependent upon raising additional financing through borrowings, share issuances, receiving funds through sale of assets, supply agreements or product licensing agreements, and from obtaining regulatory approval in various jurisdictions to market and sell its product candidates and ultimately achieving future profitable operations. The outcome of these matters is dependent on a number of factors outside of the Company's control. This material uncertainty may cast significant doubt about the Company's ability to continue as a going concern beyond that period.
Management continues to pursue additional sources of funds including through further arrangements relating to the distribution of VIVIMIND™ and a potential partnership for NRM8499. While the discussions could lead to the signing of binding agreements in the future, there can be no assurance whatsoever that any such transaction will be put in place.
About BELLUS Health
BELLUS Health is a development-focused health company concentrating on the development of products that provide innovative health solutions and address critical unmet medical needs. For further information on BELLUS Health, please visit www.bellushealth.com.
Forward Looking Statements
Certain statements contained in this news release, other than statements of fact that are independently verifiable at the date hereof, may constitute forward-looking statements. Such statements, based as they are on the current expectations of management, inherently involve numerous risks and uncertainties, known and unknown, many of which are beyond BELLUS Health Inc.'s control. Such risks include but are not limited to: the ability to obtain financing immediately in current markets, the impact of general economic conditions, general conditions in the pharmaceutical and/or nutraceutical industry, changes in the regulatory environment in the jurisdictions in which the BELLUS Health Inc. does business, stock market volatility, fluctuations in costs, and changes to the competitive environment due to consolidation, achievement of forecasted burn rate, achievement of forecasted clinical trial milestones, and that actual results may vary once the final and quality-controlled verification of data and analyses has been completed. Consequently, actual future results may differ materially from the anticipated results expressed in the forward-looking statements. The reader should not place undue reliance, if any, on any forward-looking statements included in this news release. These statements speak only as of the date made and BELLUS Health Inc. is under no obligation and disavows any intention to update or revise such statements as a result of any event, circumstances or otherwise, unless required by applicable legislation or regulation. Please see the Company's public fillings including the Annual Information Form of BELLUS Health Inc. for further risk factors that might affect the Company and its business.
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