LAVAL, QC, Feb. 26, 2014 /CNW/ - BELLUS Health Inc. (TSX: BLU) ("BELLUS Health" or the "Company"), a drug development company focused on rare diseases, today reported its financial and operating results for the year ended December 31, 2013.
2013 Highlights
- Recruitment reached 200 patients for the Phase III Confirmatory Study for KIACTA™ for the treatment of AA amyloidosis, and is expected to be completed in the second quarter of 2014;
- Phase III Confirmatory Study is expected to conclude in 2016;
- KIACTA™'s intellectual property further strengthened through the issuance of a U.S. patent expiring in 2026;
- KIACTA™ granted Orphan Disease Drug Status in Japan;
- Acquired all issued and outstanding common shares of Thallion Pharmaceuticals Inc., adding a clinical stage drug candidate in a rare disease indication;
- Concluded an agreement with AmorChem Holdings Inc. to develop drug candidates for the treatment of AL amyloidosis, a rare disease caused by the buildup of immunoglobulin amyloid light chain proteins;
- Divested two non-core assets, VIVIMIND™ and BLU8499, which will allow the Company to focus entirely on the development of drugs for rare diseases;
- Concluded the year with a cash position of $15.3 million, which should enable the Company to finance its operations beyond the end of the Phase III Confirmatory Study for KIACTA™.
"We have exited 2013 as a Company focused on developing drugs for rare diseases," said Roberto Bellini, President and Chief Executive Officer of BELLUS Health. "In 2013, the KIACTA™ Phase III Confirmatory Study has progressed on schedule and we have built a diversified pipeline of rare disease drug projects. As we look ahead, the remainder of 2014 and 2015 should be a period of significant growth for the Company as we advance our rare disease assets into and through the clinic towards shareholder value-creating events."
Phase III Confirmatory Study for KIACTA™
During the fourth quarter of 2013, recruitment continued for the Phase III Confirmatory Study for KIACTA™, an orally bioavailable small molecule intended for the treatment of AA amyloidosis, an orphan indication that often rapidly leads to dialysis and death. The study is designed to confirm the safety and efficacy of KIACTA™ in preventing renal function decline in patients diagnosed with AA amyloidosis. KIACTA™'s safety and efficacy were demonstrated in a previous Phase II/III study. The Phase III Confirmatory Study is the last key step before applications for regulatory approval for KIACTA™ can be filed. The study is expected to enroll approximately 230 patients from more than 70 sites in 30 countries worldwide. On January 9, 2014, the Company announced that approximately 200 patients had been enrolled in the study. Recruitment is expected to be completed in the second quarter of 2014.
The Phase III Confirmatory Study is an event-driven trial which will conclude when 120 patients have experienced an event linked to the deterioration of kidney function. An event is counted when a patient's kidney function has deteriorated as measured by a persistent 80 per cent increase in serum creatinine, a persistent 40 percent decrease in creatinine clearance, or by reaching end stage renal disease. On January 9, 2014, the Company announced that more than 40 patients have had an event. Based on current recruitment and event rates, the KIACTA™ Phase III Confirmatory Study is expected to conclude in 2016.
KIACTA™ is partnered with global private equity firm Auven Therapeutics, who is responsible for conducting and funding the Phase III Confirmatory Study and other related activities, which total costs are currently estimated to be in excess of US$50 million.
As part of the Phase III Confirmatory Study, there are periodic meetings of the Data Safety Monitoring Board ("DSMB"), which independently assesses the safety of KIACTA™ throughout the study. Based on its last review in October 2013, the DSMB recommended that the study continue as per protocol.
Patients completing the Phase III Confirmatory Study will be offered to continue in an extended program, for which the first patients are expected to be enrolled in the first quarter of 2014.
KIACTA™ has been granted Orphan Drug designation or its equivalent in the United States, Europe and, as announced in July 2013, Japan, which provide for seven, ten and ten years of market exclusivity, respectively, once the drug is approved, as well as a reduction in application and review fees.
In July 2013, the U.S. Patent and Trademark Office ("USPTO") granted a U.S. Patent offering strengthened intellectual property protection for KIACTA™. The patent, which will expire in 2026 with a possible extension available up to 2031, covers the dosing regimen of daily administration of KIACTA™ relative to AA Amyloidosis patients' kidney impairment. The patent has also been granted in Canada, Australia and certain countries in Eurasia.
Shigamab™ - Acquisition of Thallion Pharmaceuticals Inc.
On August 15, 2013, the Company acquired all of the issued and outstanding common shares of Thallion Pharmaceuticals Inc. ("Thallion"), for a purchase price of $6.266 million or $0.1889 per common share and the issuance of one contingent value right ("CVR") per common share.
Thallion is a biotechnology company developing pharmaceutical products in the areas of infectious disease and oncology. Thallion's lead clinical program Shigamab™ is a monoclonal antibody therapy being developed for the treatment of Hemolytic Uremic Syndrome related to Shiga toxin-producing E. coli ("STEC") bacterial infections ("sHUS"). sHUS principally affects the kidneys and often leads to acute dialysis, and in certain cases chronic kidney disease and death, primarily in children. Shigamab™ has recently completed a Phase II clinical trial where it has shown to be safe and well tolerated in the target pediatric population.
Co-development agreement for AL amyloidosis with AmorChem Holdings Inc.
On October 25, 2013, BELLUS Health entered into an agreement with AmorChem Holdings Inc. ("AmorChem") to develop drug candidates for the treatment of AL amyloidosis. As part of the co-development agreement, BELLUS Health will provide proof-of-concept data, know-how and expertise. AmorChem will fund the synthesis of compounds and the biological testing to confirm the potential of these compounds in established models of AL amyloidosis. Upon completion of the co-development efforts, BELLUS Health will have an exclusive, time-limited option to buy out AmorChem's rights in the project.
AL amyloidosis is a rare disease in which immunoglobulin amyloid light chain proteins build up in various parts of the body, mainly the kidneys, heart, liver and peripheral nerves. As these proteins accumulate, they disrupt the structure and function of the affected tissues and organs leading to organ failure and eventually, death. Currently, there is no specific treatment for the disease; patients are treated with high dose chemotherapy or stem cell transplant. AL amyloidosis affects approximately 15,000 patients in the United States and Europe.
VIVIMIND™ and BLU8499 divestiture
On October 22, 2013, BELLUS Health divested two non-core assets: VIVIMIND™, a natural health product for memory protection, and BLU8499, a drug candidate for the treatment of central nervous system diseases including Alzheimer's disease.
BELLUS Health licensed the VIVIMIND™ worldwide rights to FB Health S.p.A. ("FB Health") for a cash consideration of more than $2 million to be received over the next four years. FB Health is an Italy-based distributor of specialty natural health and pharmaceutical products targeting neurologists and geriatricians.
BELLUS Health also entered into a worldwide license agreement with FB Health for BLU8499 and a family of analogs, along with an associated platform of chemotypes and clinical datasets, in exchange for an equity stake in FB Health. In turn, FB Health sub-licensed all its rights to Alzheon Inc. ("Alzheon"), as part of an exclusive worldwide license, excluding Italy. BELLUS Health will receive a portion of all future payments received by Alzheon related to BLU8499 and royalties on net sales of BLU8499. Alzheon is a clinical-stage biotechnology company focused on brain health, memory and aging, developing the next generation of medicines for Alzheimer's and other neurodegenerative diseases.
BELLUS Health also concurrently announced the termination of its agreement with Asclepios Bioresearch (UK) Limited for the development of BLU8499.
Summary of Financial Results
All currency figures reported in this press release are in Canadian dollars, unless otherwise specified.
| Year ended December 31, 2013 |
Year ended December 31, 2012 |
|
| (in thousands of dollars, except per share data) | ||
| Revenues | 2,256 | 2,298 |
| Research and development expenses | (1,270) | (954) |
| General and administrative expenses | (4,275) | (4,961) |
| Finance income | 846 | 1,272 |
| Finance costs | (200) | (19,625) |
| Gain on acquisition | 1,672 | - |
| Gain on sale of unrecognized assets | - | 8,150 |
| Other income | - | 650 |
| Net loss | (971) | (13,170) |
| Net loss attributable to owners of the Company | (872) | (13,255) |
| Basic and diluted loss per share | (0.02) | (0.41) |
The Company's full consolidated financial statements and accompanying management's discussion and analysis for the year ended December 31, 2013, will be available shortly on SEDAR at www.sedar.com and on the Company's website at www.bellushealth.com.
- For the year ended December 31, 2013, net loss attributable to owners of the Company amounted to $872,000 ($0.02 per share), compared to $13,255,000 ($0.41 per share) for the previous year. The decrease in net loss is primarily due to items recorded in 2012 in relation to the strategic partnership, financing and capital reorganization that occurred in May 2012, namely a non-cash loss on settlement of convertible securities in the amount of $15,751,000 (including the change in fair value of the embedded conversion option liability on convertible notes), partially offset by a gain on sale of unrecognized assets in the amount of $8,150,000. The decrease is also due to a reduction in accretion expense in the amount of $3,566,000 as a result of the settlement of convertible securities, as part of the same transaction. In addition, the decrease is attributable to the gain on acquisition in the amount of $1,672,000 recorded in 2013 in relation to the acquisition of Thallion.
- Research and development expenses amounted to $1,270,000 for the year ended December 31, 2013, compared to $954,000 for the previous year. The increase is mainly attributable to an expense reversal recorded in the previous year in relation to accruals that did no longer meet the definition of a liability.
- General and administrative expenses amounted to $4,275,000 for the year ended December 31, 2013, compared to $4,961,000 for the previous year. The decrease is mainly due to transaction costs recorded in the previous year in relation to the strategic partnership, financing and capital reorganization that occurred in May 2012, partially offset by transaction costs recorded in 2013 in relation to the acquisition of Thallion.
- Finance income amounted to $846,000 for the year ended December 31, 2013, compared to $1,272,000 for the previous year. The decrease is mainly attributable to a lower increase in the fair value of the ABCP Notes in 2013 compared to the previous year.
- Finance costs amounted to $200,000 for the year ended December 31, 2013, compared to $19,625,000 for the previous year. The decrease is primarily due to a non-cash loss on settlement of convertible securities recorded in the previous year in the amount of $15,751,000 (including the change in fair value of the embedded conversion option liability on convertible notes) in relation to the strategic partnership, financing and capital reorganization that occurred in May 2012. The decrease is also due to a reduction in accretion expense in the amount of $3,566,000 as a result of the settlement of convertible securities, as part of the same transaction.
- Gain on acquisition amounted to $1,672,000 for the year ended December 31, 2013, and is in relation to the acquisition of Thallion in August 2013.
- Gain on sale of unrecognized assets amounted to $8,150,000 for the year ended December 31, 2012, and is in relation to the non-dilutive capital payment received from Pharmascience Inc. as part of the strategic partnership, financing and capital reorganization that occurred in May 2012.
- Other income amounted to $650,000 for the year ended December 31, 2012. This income represents a payment received from Advanced Orthomolecular Research Inc. ("AOR") in 2012 in relation to the achievement of a pre-established milestone set in the share purchase agreement entered into at the time AOR acquired BELLUS Health's wholly-owned Canadian subsidiary, OVOS Natural Health Inc., in December 2010.
As at December 31, 2013, the Company had available cash, cash equivalents and short-term investments totalling $15,297,000, compared to $18,569,000 as at December 31, 2012. Based on management's estimate, the current cash position should enable the Company to finance its operations beyond the end of the KIACTA™ Phase III Confirmatory Study.
About BELLUS Health (www.bellushealth.com)
BELLUS Health is a drug development company focused on rare diseases. It has a portfolio of rare disease projects including KIACTA™ in Phase III for AA amyloidosis, clinical stage ShigamabTM for STEC-related Hemolytic Uremic Syndrome ("sHUS") and a research-stage project for AL amyloidosis. The lead program KIACTA™ is currently in a Phase III Confirmatory Study for the treatment of AA amyloidosis, an orphan indication resulting in renal dysfunction that often rapidly leads to dialysis and death. KIACTA™ is partnered with global private equity firm Auven Therapeutics.
About AA Amyloidosis
AA amyloidosis is a deadly condition that progresses from chronic inflammatory diseases such as rheumatoid arthritis. The disease causes a protein called amyloid A to accumulate in major organs, particularly the kidneys, which leads to organ dysfunction, failure, and eventually death.
There is currently no available treatment for AA amyloidosis.
KIACTA™ has been granted Orphan Drug designation or its equivalent in the United States, Europe and Japan, which provide seven, ten and ten years of market exclusivity, respectively, once the drug is approved, as well as a reduction in application and review fees.
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, the impact of general economic conditions, general conditions in the pharmaceutical 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, potential payments in relation to indemnity agreements, 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. The length of KIACTATM Phase III Confirmatory Study is dependent upon many factors including clinical sites activation, patient enrolment rate, patient drop-out rate and occurrence of clinical endpoint events. 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 BELLUS Health Inc.'s public fillings including the Annual Information Form for further risk factors that might affect BELLUS Health Inc. and its business.
SOURCE: BELLUS Health Inc.
Adam Peeler
TMX Equicom
416-815-0700 ext. 225
[email protected]
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