- BELLUS Health reports results for the first quarter ended March 31, 2012, and provides corporate update -
LAVAL, QC, May 15, 2012 /CNW/ - BELLUS Health Inc. (TSX: BLU) ("BELLUS Health" or the "Company") today conducted its Annual and Special Meeting of Securityholders in relation to the $17.25 million strategic transaction and financing with Pharmascience Inc. ("Pharmascience") announced on April 5, 2012. The Company also reported its financial results for the first quarter ended March 31, 2012, and provided a corporate update.
- Securityholders have voted in favour of the $17.25 million strategic partnership and financing with Pharmascience announced on April 5, 2012. The transaction is expected to close by May 25, 2012;
- 90 patients have been enrolled in the Company's Phase III confirmatory trial for KIACTA™ in AA amyloidosis;
- Preliminary, blinded data from the 78 patients profiled in the Phase III trial demonstrates that demographics and baseline characteristics are very similar to the previous trial;
- Exclusive license and distribution agreement was signed with LevPharm Ltd. for VIVIMIND™ in Israel.
"The strategic partnership with Pharmascience that securityholders approved today will fund the Company beyond pivotal data for KIACTA™ in AA amyloidosis. It will also allow us to evaluate opportunities to add promising compounds to our pipeline," said Roberto Bellini, President and Chief Executive Officer of BELLUS Health. "AA amyloidosis is a deadly orphan condition with no current treatment and peak annual revenue potential of $400 to $600 million. Baseline patient data from our ongoing Phase III trial are very similar to the first Phase III trial we completed, confirming that we constructed an effective trial design based on the strong results of our first Phase III trial."
Strategic Partnership and Financing with Pharmascience
Securityholders approved the strategic partnership and financing with Pharmascience at the Annual and Special Meeting of Securityholders held today at BELLUS Health's premises in Laval, Quebec. Securityholders also approved a 30 for one common share consolidation, to take effect immediately upon closing of the transaction.
Assuming all conditions of the completion of the arrangement are satisfied or waived, including approval by the Quebec Superior Court of Justice, the transaction is expected to be completed by May 25, 2012.
KIACTA™ (eprodisate) - Addressing a deadly medical condition with no current treatment
Subsequent to the end of the first quarter of 2012, BELLUS Health announced, in relation to its partnership with Celtic Therapeutics Inc. ("Celtic Therapeutics"), that 90 of approximately 230 patients had been enrolled in the global Phase III 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.
On May 10, 2012, Dr. Denis Garceau, Senior Vice President, Drug Development of BELLUS Health provided an update on the pivotal study as part of the XIII International Symposium on Amyloidosis at the University Medical Center of Groningen in The Netherlands. Dr. Garceau reported that preliminary, blinded data from the ongoing trial demonstrates that the baseline characteristics and demographics of the patients profiled to date are very similar to the first Phase III study completed. These data are important because they confirm that the trial design constructed based on the strong results of the first Phase III study is effective. A summary of the improvements made to the ongoing Phase III trial design may be found below:
- The duration of the trial was changed from a fixed 2-year duration to an event-driven trial that will end when 120 events are attained. The data from the first study was used in calculating the number of events (120 events) required to provide a ~90% statistical power (versus 80% in first study), assuming a comparable effect of KIACTA™ treatment;
- Considering that the Phase 3 confirmatory study will be the second pivotal study to support KIACTA™ NDA application, the regulatory agencies agreed that the p-value threshold for a successful study could be increased to 0.05 from 0.01 in the first study;
- The entry criteria regarding renal function was altered slightly to enrol patients with high proteinuria, which is the patient subgroup that benefited most from KIACTA™ in the first study; and
- The components of the primary endpoints were changed to improve the accuracy, sensitivity and validity of the primary efficacy endpoint.
In April 2012, BELLUS Health entered into a licence and distribution agreement with LevPharm Ltd. (LevPharm), pursuant to which BELLUS Health granted LevPharm exclusive distribution rights for VIVIMIND™ in Israel. LevPharm expects to launch VIVIMIND™ in 2013. VIVIMIND™ is a natural health product designed to protect memory function.
Summary of Financial Results
All currency figures reported in this press release are in Canadian dollars, unless otherwise specified.
| Three-months ended
March 31, 2012
| Three-months ended
March 31, 2011
|(in thousands of dollars, except per share data)|
|Research and development expenses, net||(329)||(811)|
|General and administrative expenses||(1,278)||(1,096)|
|Net (loss) income||(3,193)||3,299|
|Basic (loss) earnings per share||(0.01)||0.01|
|Diluted loss per share||(0.01)||-|
The Company's full consolidated financial statements and accompanying management's discussion and analysis for the three-month period ended March 31, 2012, will be available shortly on SEDAR at www.sedar.com and on the Company's web site at www.bellushealth.com.
- For the three-month period ended March 31, 2012, net loss amounted to $3,193,000 ($0.01 per share), compared to a net income of $3,299,000 ($0.01 per share) for the corresponding period the previous year. The increase in net loss in the current quarter is mainly attributable to a decrease in finance income period over period, as explained below.
- Revenues amounted to $568,000 for the three-month period ended March 31, 2012, compared to $746,000 for the corresponding period the previous year. Revenues mainly consist of revenue from the asset sale and license agreement as well as the service agreement entered into with Celtic Therapeutics in 2010 for KIACTA™.
- Research and development expenses, net of research tax credits and grants, amounted to $329,000 for the three-month period ended March 31, 2012, compared to $811,000 for the corresponding period the previous year. The decrease is mainly attributable to a reduction in expenses incurred in relation to NRM8499 Phase I clinical trial for the treatment of Alzheimer's disease, which ended in the first quarter of 2011, and a reduction in the workforce and other cost reduction initiatives implemented by the Company during the past year.
- General and administrative expenses amounted to $1,278,000 for the three-month period ended March 31, 2012, compared to $1,096,000 for the corresponding period the previous year. Expenses in 2011 are net of a gain on sale lease back of $1,176,000 in relation to the lease of the Company's Laval, Quebec premises that was terminated in April 2011. Excluding this item, the decrease is mainly due to a reduction in the workforce and other cost reduction initiatives implemented by the Company during the past year.
- Finance income amounted to $734,000 for the three-month period ended March 31, 2012, compared to $6,356,000 for the corresponding period the previous year. The decrease is primarily related to finance income recorded in 2011 in relation to the decrease in the fair value of the embedded conversion option liability on the 2009 Notes in the amount of $6,067,000. The conversion option of the 2009 Notes is considered as an embedded derivative that should be marked to market through income.
- Finance costs amounted to $2,888,000 for the three-month period ended March 31, 2012, compared to $1,896,000 for the corresponding period the previous year. The increase is primarily related to finance costs recorded in 2012 in relation to the increase in the fair value of the embedded conversion option liability on the 2009 Notes in the amount of $667,000. The increase is also due to the increasing accretion expense recorded on the 2009 Notes as they advance to maturity.
Financial Position and Going Concern
As at March 31, 2012, the Company had available cash and cash equivalents of $4,107,000, compared to $5,105,000 as at December 31, 2011. As at March 31, 2012, 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 over the next twelve months.
Should the transaction with Pharmascience be completed, whereby Pharmascience will pay a total of $17.25 million to BELLUS Health, it will remove the going concern material uncertainty for the foreseeable future.
About BELLUS Health
BELLUS Health is a development-focused healthcare company concentrating on products that provide innovative health solutions and address critical unmet medical needs. The Company, in collaboration with its partner, Celtic Therapeutics, is currently advancing its novel drug candidate KIACTA™, through a Phase III trial for the treatment of AA amyloidosis, an orphan indication resulting in renal dysfunction that often rapidly leads to dialysis and eventually death. AA amyloidosis affects approximately 50,000 individuals in the United States, Europe and Japan.
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 and it is estimated that approximately 50,000 patients are living with the disease in the US, Europe and Japan. Independent research conducted by the Frankel Group in 2009 suggests that peak annual revenues of $400 million to $600 million are achievable.
Because patients diagnosed with AA amyloidosis tend to quickly progress to a costly regimen of dialysis, healthcare payers are anxious to find alternative treatments for this deadly condition. KIACTA™ has been granted Orphan Drug designation or its equivalent in the United States and Europe, which would provide seven and ten years of market exclusivity, respectively, as well as a reduction in application and review fees.
Phase III Study for KIACTA™ (eprodisate) Description
The international, randomized, double-blind, placebo-controlled, event-driven study will involve approximately 230 patients diagnosed with AA amyloidosis recruited from approximately 79 sites in 28 countries worldwide, including those in Japan. Recruitment is ongoing and is expected to be completed in the second half of 2013. The Phase III confirmatory study is an event-driven trial which will conclude when 120 patients have reached worsening events linked to deterioration of kidney function.
There will be periodic data safety monitoring review boards that will independently assess the safety of KIACTA™ throughout the study, of which the first occurred on May 4, 2012.
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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