Helix BioPharma Corp. Announces Fiscal Q2 2014 Results
AURORA, ON--(Marketwired - Mar 14, 2014) - Helix BioPharma Corp.
(TSX: HBP) (FRANKFURT: HBP), a biopharmaceutical company developing
drug candidates for the prevention and treatment of cancer, today
announced financial results for the three and six-month periods
ended January 31, 2014 and 2013.
HIGHLIGHTS FOR THE PERIOD
- On October 15, 2013, the Company completed an interim review of
data collected to date for its European Phase I/II clinical study
of L-DOS47. Subsequent to the completion of the interim
review, on February 18, 2014, the Company announced the start of
screening of patients in cohort 7. See "L-DOS47"
below under the heading "Research and Development
Update".
- At the Company's annual general and special meeting of
shareholders ("AGM") held on December 18, 2013, Messrs. Yvon
Bastien, Slawomir Majewski, Marek Orlowski, Sven Rohmann, Robert A.
Verhagen, Stacy L. Wills and Slawomir Ludwikowski were elected as
directors of the Company. In the case of Mr. Ludwikowski, a
majority of the votes represented by proxy were withheld from
voting for and, in accordance with the Company's majority voting
policy, Mr. Ludwikowski was required to submit his resignation to
the Board of Directors ("Board") for the Board's
consideration. Subsequent to the end of the fiscal quarter,
Mr. Ludwikowski tendered his resignation to the Board, which the
Board accepted on March 7, 2014. Mr. Mario Gobbo resigned from
the Board prior to the AGM.
- On January 10, 2014, the Company announced Marek Orlowski, a
member of the Board had purchased 1,000,000 previously issued and
outstanding shares of the Company.
- On December 6, 2013, the Company announced the termination of
John Docherty, the Company's President and Chief Operating
Officer.
- On November 4, 2013, the Company announced the closing of a
private placement for net proceeds of $4,672,000. The terms of
the private placement are for the purchase of common shares at
$1.15 per share and include one warrant per share at an exercise
price of $1.61 with an expiry of five years from the date of
issue.
RESEARCH AND DEVELOPMENT UPDATE
L-DOS47 On May 14, 2012, the Company commenced clinical
site initiations and patient recruitment activities for its
European Phase I/II clinical study of L-DOS47 in Poland. Since
the dosing of the first patient in Cohort 1 on October 23, 2012,
the Company remains on target to achieve its milestone of
completing Cohort 8 of the Phase I component of the European Phase
I/II clinical study by the summer of 2014. As previously
disclosed, the total number of patients to be enrolled in the study
will depend on how many escalating dose levels are required to
reach maximum tolerated dose ("MTD"). The Company originally
estimated that MTD would be reached after enrolling eight cohorts
of three patients. Management also originally assumed that
there would be two dose limiting toxicity events requiring a
further six patients to be enrolled, for a total of up to 30
patients by the time the study dosed patients in Cohort
8.
On October 15, 2013, the Company announced the completion of an
interim data review of the first four cohorts for this study. The
release stated that L-DOS47 was well tolerated for all patients
treated within all cohorts. None of the treatment related adverse
events reported to date has met the definition of a dose-limiting
toxicity. Adverse events reported as of that date are those
normally expected for the population under study.
As of March 7, 2014, a total of 21 patients had been dosed in
the Phase I component of the study. Based on the latest
patient enrollment rates, the Company still expects to complete the
enrollment of Cohort 8 of the Phase I component of this study by
the summer of 2014. The Company has initiated a protocol amendment
that would allow the Company to continue dose escalation for the
Phase I component of the study beyond Cohort 8 in the event MTD is
not reached by the end of Cohort 8, as originally
estimated. Without regulatory approval for the protocol
amendment, the Company will not be able to enroll patients beyond
Cohort 8.
The Company continues to re-evaluate the U.S. Phase I protocol
previously approved by the U.S. Food and Drug Administration
("FDA") and is now developing an investigational new drug ("IND")
application for approval by the FDA and commencement of a study for
an L-DOS47 Phase I, open label, dose escalation study in
combination with standard doublet therapy of pemetrexed/carboplatin
in patients with Stage IV, recurrent or metastatic non-squamous
non-small cell lung cancer ("NSCLC"). In addition, the Company is
also developing a new clinical trial application ("CTA") in Canada
for approval by Health Canada and commencement of a Phase I study
for L-DOS47 in combination with the chemotherapy drug vinorelbine
in patients with metastatic NSCLC and metastatic breast cancer.
The Company's cash position as at January 31, 2014 of $4,386,000
is not sufficient to see the entire European Phase I/II clinical
study in Poland, nor any part of the U.S. Phase I and Canadian
Phase I study, if either or both is approved by regulators, through
to completion. The Company has previously disclosed that it
expected to have sufficient cash to complete the Phase I portion of
the European clinical study, provided the Company did not
experience any unforeseen challenges and expenditures. The
Company is currently dosing patients in Cohort 7. The Company
originally estimated that the Phase I component of this study would
enroll eight cohorts, as this was the number of cohorts estimated
to be required to reach MTD. However, in the event the Company
does receive regulatory approval for the protocol amendment but
does not reach MTD at Cohort 8 as originally estimated, the Company
will not have sufficient funds to complete the European Phase I
trial for L-DOS47 in Poland.
Topical Interferon Alpha-2b After agreeing to terminate
the contractual arrangement with Merck Sharp & Dohme Corp
("Merck"), the Company's primary and ongoing focus, as it relates
to the Topical Interferon Alpha-2b program, has been on sourcing
and qualifying alternative interferon alpha-2b raw material
samples, and finding suitable strategic partner(s) who would be
willing to license or acquire the product and supports the
remaining development costs through to commercial launch. As a
result, the Company has hired an outside consultant to assist it in
finding a suitable strategic partner(s).
To date, the Company has completed preliminary quality testing,
comparing alternate raw material samples to its approved drug
substance specification and a potential new supplier of the
interferon alpha-2b raw material necessary to formulate the product
candidate has been identified. However, further quality testing and
evaluation of this material and its supplier, as well as
negotiation of supply terms acceptable to the Company and receipt
of necessary regulatory approvals will be necessary before the
Company will be in a position to definitively verify raw material
comparability with the interferon alpha-2b originally supplied by
Merck.
The continuation of the Topical Interferon Alpha-2b program more
generally is dependent on a strategic partner(s) providing
additional funding.
FINANCIAL REVIEW
The Company recorded a net loss and total comprehensive loss of
$2,632,000 and $4,769,000, respectively for the three and six-month
periods ended January 31, 2014 for a loss per common share of $0.04
and $0.07, respectively. For the comparative three and six-month
periods ended January 31, 2013, the Company recorded net income and
total comprehensive income of $4,669,000 and $2,592,000,
respectively for earnings per common share of $0.07 and $0.04.
Included in net income and total comprehensive income for the
three and six-month periods ended January 31, 2013 is a gain on
sale from discontinued operations of $6,083,000. On January
25, 2013, the Company announced the sale of its distribution
business in Canada.
Excluding both the gain on sale and net income and total
comprehensive income from discontinued operations, the Company
recorded a net loss and total comprehensive loss from continuing
operations of $1,726,000 and $4,126,000, respectively for the three
and six-month periods ended January 31, 2013 for a loss per common
share of $0.03 and $0.06, respectively.
Research and development Research and development costs
totalled $1,649,000 and $2,981,000, respectively for the three and
six-month periods ended January 31, 2014. For the three and six
month periods ended January 31, 2013, research and development
costs totalled $1,049,000 and $2,657,000, respectively.
L-DOS47 research and development expenses for the three and
six-month periods ended January 31, 2014 totalled $556,000 and
$1,205,000, respectively ($586,000 and $1,408,000 respectively for
the three and six-month periods ended January 31,
2013). L-DOS47 research and development expenditures relate
primarily to expenditures associated with the ongoing European
Phase I/II clinical study in Poland, costs incurred in the current
fiscal quarter associated with the preparation of an IND
application with the FDA and ongoing overhead costs in support of
the L-DOS47 drug program.
Topical Interferon Alpha-2b research and development expenses
for the three and six-month periods ended January 31, 2014 totalled
$123,000 and $238,000, respectively ($99,000 and $512,000
respectively for the three and six-month periods ended January 31,
2013). Beginning in June 2012, the Company initiated a
downsizing of the staff in the Saskatoon laboratory. The Company
further downsized staffing levels at its Saskatoon laboratory in
October 2012, including a decision that resulted in the closure of
the Saskatoon laboratory at the end of November 2012. Costs
associated with the downsizing were charged in fiscal
2013. The Company has now limited its ongoing activities with
respect to its Topical Interferon Alpha-2b program to sourcing and
qualifying alternative interferon alpha-2b raw material samples,
strengthening the BiPhasix™ patent portfolio and finding suitable
strategic partner(s) who would be willing to license or acquire the
product and support the remaining development costs.
Corporate research and development expenses for the three and
six-month periods ended January 31, 2014 totalled $745,000 and
$1,026,000 respectively ($223,000 and $450,000 respectively for the
three and six-month periods ended January 31, 2013). Included in
corporate research and development expenses for the three and
six-month period ended January 31, 2014 is a one-time payout of
$500,000 related to a severance payment.
Trademark and patent related expenses for the three and
six-month periods ended January 31, 2014 totalled $153,000 and
$378,000, respectively ($15,000 and $25,000 respectively for the
three and six-month periods ended January 31, 2013). The
increased costs relate to the Company's efforts to strengthen the
DOS47 and BiPhasix™ patent portfolios.
Operating, general and administration Operating,
general and administration expenses for the three and six-month
periods ended January 31, 2014 totalled $1,011,000 and $1,837,000,
respectively ($704,000 and $1,468,000 respectively for the three
and six-month periods ended January 31, 2013). Higher operating,
general and administration expenses for both the three and
six-month periods ended January 31, 2014 and 2013 reflect higher
legal fees, consulting fees and investor relations activities.
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash reserves of $4,386,000 as at January 31, 2014
are insufficient to meet anticipated cash needs for working capital
and capital expenditures through the next twelve months, nor are
they sufficient to see the current research and development
initiatives through to completion. To the extent that the Company
does not believe it has sufficient liquidity to meet its current
obligations, management considers securing additional funds,
primarily through the issuance of equity securities of the Company,
to be of the utmost importance.
The Company's condensed unaudited interim consolidated statement
of financial position as at January 31, 2014 and July 31, 2013 are
summarized below:
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statement of Financial
Position (thousand $) |
|
|
|
|
|
|
|
January 31 |
|
July 31 |
|
|
2014 |
|
2013 |
|
|
|
|
|
Non current assets |
|
576 |
|
677 |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Prepaid expenses |
|
208 |
|
139 |
|
Accounts receivable |
|
348 |
|
559 |
|
Cash |
|
4,386 |
|
4,493 |
|
|
4,942 |
|
5,191 |
|
|
|
|
|
Total assets |
|
5,518 |
|
5,868 |
|
|
|
|
|
Shareholders' equity |
|
5,004 |
|
4,920 |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Deferred lease credit |
|
10 |
|
23 |
|
Accrued liabilities |
|
286 |
|
621 |
|
Accounts payable |
|
218 |
|
304 |
|
|
514 |
|
948 |
|
|
|
|
|
Total liabilities & shareholders equity |
|
5,518 |
|
5,868 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company's condensed unaudited interim consolidated statement
of net loss and comprehensive loss for the three and six-month
periods ending January 31, 2014 and 2013 and the condensed
unaudited interim consolidated statement of cash flows for the
three and six-month periods ending January 31, 2014 and 2013 are
summarized below:
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Net Loss and
Comprehensive Loss |
(thousand
$, except for per share
data) |
|
|
|
|
|
|
|
|
|
|
|
For the three-month periods ended |
|
For the six-month periods ended |
|
|
Jan-31 |
|
Jan-31 |
|
Jan-31 |
|
Jan-31 |
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
Research and development |
|
1,649 |
|
1,049 |
|
2,981 |
|
2,657 |
|
Operating, general & administration |
|
1,011 |
|
704 |
|
1,837 |
|
1,468 |
|
(Gain) on disposal of property, plant, equipment |
|
- |
|
(18) |
|
- |
|
(18) |
|
|
|
|
|
|
|
|
|
Results from operating activities before finance
items |
|
(2,660) |
|
(1,735) |
|
(4,818) |
|
(4,107) |
|
|
|
|
|
|
|
|
|
Finance items |
|
28 |
|
9 |
|
49 |
|
(19) |
|
|
|
|
|
|
|
|
|
Loss and total comprehensive loss from continuing
operations |
|
(2,632) |
|
(1,726) |
|
(4,769) |
|
(4,126) |
|
|
|
|
|
|
|
|
|
Net income and total comprehensive income from
discontinued operations |
|
- |
|
312 |
|
- |
|
635 |
|
|
|
|
|
|
|
|
|
Gain from sale of discontinued operation |
|
- |
|
6,083 |
|
- |
|
6,083 |
|
|
|
|
|
|
|
|
|
Net income (loss) and total comprehensive income
(loss) |
|
(2,632) |
|
4,669 |
|
(4,769) |
|
2,592 |
|
|
|
|
|
|
|
|
|
Loss per share from continuing operations * |
|
$
(0.04) |
|
$
(0.03) |
|
$
(0.07) |
|
$
(0.06) |
|
|
|
|
|
|
|
|
|
Income per share from discontinued operations * |
|
$
- |
|
$
0.01 |
|
$
- |
|
$
0.01 |
|
|
|
|
|
|
|
|
|
Total loss per common share * |
|
$
(0.04) |
|
$
0.07 |
|
$
(0.07) |
|
$
0.04 |
|
|
|
|
|
|
|
|
|
* Figures are for both basic and fully diluted |
|
|
|
Consolidated Statements of Cash Flows (thousand
$) |
(thousand
$) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three-month periods ended |
|
|
For the six-month periods ended |
|
|
|
Jan-31 |
|
|
Jan-31 |
|
|
Jan-31 |
|
|
Jan-31 |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
Cash provided by (used in): |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss and total comprehensive loss from continuing operations |
|
(2,632 |
) |
|
(1,726 |
) |
|
(4,769 |
) |
|
(4,126 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Items not involving cash: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation of property, plant and equipment |
|
50 |
|
|
103 |
|
|
104 |
|
|
206 |
|
|
Deferred lease credit |
|
(7 |
) |
|
(7 |
) |
|
(13 |
) |
|
(13 |
) |
|
Stock-based compensation |
|
153 |
|
|
76 |
|
|
181 |
|
|
172 |
|
|
Foreign exchange loss |
|
(19 |
) |
|
(7 |
) |
|
(35 |
) |
|
27 |
|
|
(Gain) on disposal of property, plant, equipment |
|
- |
|
|
(18 |
) |
|
- |
|
|
(18 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,455 |
) |
|
(1,579 |
) |
|
(4,532 |
) |
|
(3,752 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in non-cash working capital |
|
(329 |
) |
|
(375 |
) |
|
(279 |
) |
|
(337 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities |
|
(2,784 |
) |
|
(1,954 |
) |
|
(4,811 |
) |
|
(4,089 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing activities |
|
4,672 |
|
|
- |
|
|
4,672 |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities |
|
(3 |
) |
|
17 |
|
|
(3 |
) |
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash |
|
19 |
|
|
7 |
|
|
35 |
|
|
(27 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash from continuing operations |
|
1,904 |
|
|
(1,930 |
) |
|
(107 |
) |
|
(4,112 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in cash from discontinued operations |
|
- |
|
|
7,095 |
|
|
- |
|
|
7,728 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash beginning of the year |
|
2,482 |
|
|
3,313 |
|
|
4,493 |
|
|
4,862 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash end of the year |
|
4,386 |
|
|
8,478 |
|
|
4,386 |
|
|
8,478 |
|
|
|
|
|
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The Company's condensed unaudited interim consolidated financial
statements and management's discussion and analysis are being filed
under the Company's profile on SEDAR at www.sedar.com, as well as
on the Company's website at www.helixbiopharma.com. Shareholders
have the ability to receive a hard copy of the Company's unaudited
condensed interim consolidated financial statements free of charge
upon request at the address below.
About Helix BioPharma Corp.
Helix BioPharma Corp. is a biopharmaceutical company
specializing in the field of cancer therapy. The company is
actively developing innovative products for the prevention and
treatment of cancer based on its proprietary technologies. Helix's
product development initiatives include its novel L-DOS47 new drug
candidate and its Topical Interferon Alpha-2b. Helix is currently
listed on the TSX and FSE under the symbol "HBP".
Forward-Looking Statements and Risks and Uncertainties
This news release contains forward-looking statements and
information (collectively, "forward-looking statements") within the
meaning of applicable Canadian securities laws. Forward-looking
statements are statements and information that are not historical
facts but instead include financial projections and estimates;
statements regarding plans, goals, objectives, intentions and
expectations with respect to the Company's future business,
operations, research and development, including the Company's
activities relating to DOS47 and Topical Interferon Alpha-2b,
including the sourcing and qualifying of alternative raw material
samples, strengthening the BiPhasix™ patent portfolio and finding
suitable strategic partners and other information in future
periods.
Forward-looking statements include, without limitation,
statements concerning (i) the Company's ability to operate on a
going concern being dependent mainly on obtaining additional
financing; (ii) the Company's priority continuing to be L-DOS47;
(iii) the Company's development programs for Topical Interferon
Alpha-2b, DOS47 and L-DOS47; (iv) the Company's European Phase I/II
clinical trials for L-DOS47 in Poland including the number of
cohorts required to reach MTD and the Company's potential protocol
amendment in connection with this trial; (v) the Company's planned
future U.S. Phase I clinical trial for L-DOS47 and the Company's
proposed IND and CTA applications; and (vi) future expenditures,
the insufficiency of the Company's current cash resources and the
need for financing and cost-cutting and/or cost-deferral measures
and future financing requirements and the seeking of additional
funding. Forward-looking statements can further be identified by
the use of forward-looking terminology such as
"2014", "ongoing", "estimates", "expects", or the negative
thereof or any other variations thereon or comparable terminology
referring to future events or results, or that events or conditions
"will", "may", "could", "would", or "should" occur or be achieved,
or comparable terminology referring to future events or
results.
Forward-looking statements are statements about the future
and are inherently uncertain, and are necessarily based upon a
number of estimates and assumptions that are also uncertain.
Although the Company believes that the expectations reflected in
such forward-looking statements are reasonable, such statements
involve risks and uncertainties, and undue reliance should not be
placed on such statements. Forward-looking statements, including
financial outlooks, are intended to provide information about
management's current plans and expectations regarding future
operations, including without limitation, future financing
requirements, and may not be appropriate for other purposes.
Certain material factors, estimates or assumptions have been
applied in making forward-looking statements in this news release,
including, but not limited to, the safety and efficacy of L-DOS47
and Topical Interferon Alpha-2b (low-grade cervical lesions); that
sufficient financing will be obtained in a timely manner to allow
the Company to continue operations; the success of the Company's
proposed IND and CTA applications and the cost and timeline for
reaching MTD in the Company's European Phase I/II clinical trial
for L-DOS47 in Poland and/or that the Company's proposed protocol
amendments for this study are accepted on a timeline and on terms
satisfactory to the Company; the timely provision of services and
supplies, including Interferon alpha-2b raw materials, or other
performance of contracts by third parties; future costs; the
absence of any material changes in business strategy or plans; and
the timely receipt of required regulatory approvals and strategic
partner support.
The Company's actual results could differ materially from
those anticipated in the forward-looking statements contained in
this news release as a result of numerous known and unknown risks
and uncertainties, including without limitation, the risk that the
Company's assumptions may prove to be incorrect; the risk that
additional financing may not be obtainable in a timely manner, or
at all, and that clinical trials may not commence or complete
within anticipated timelines or the anticipated budget or may fail;
third party suppliers of necessary services or of drug product and
other materials may fail to perform or be unwilling or unable to
supply the Company, which could cause delay or cancellation of the
Company's research and development activities; necessary regulatory
approvals may not be granted or may be withdrawn; the Company may
not be able to secure necessary strategic partner support; general
economic conditions, intellectual property and insurance risks;
changes in business strategy or plans; and other risks and
uncertainties referred to elsewhere in this news release, any of
which could cause actual results to vary materially from current
results or the Company's anticipated future results. Certain of
these risks and uncertainties, and others affecting the Company,
are more fully described in Helix's Annual Report, in particular
under the headings "Forward-looking Statements" and "Risk Factors",
and other reports filed under the Company's profile on SEDAR at
www.sedar.com from time to time. Forward-looking statements and
information are based on the beliefs, assumptions, opinions and
expectations of Helix's management on the date of this new release,
and the Company does not assume any obligation to update any
forward-looking statement or information should those beliefs,
assumptions, opinions or expectations, or other circumstances
change, except as required by law.
Investor Relations: Helix BioPharma Corp. Tel: 905 841-2300
Email: ir@helixbiopharma.com 3-305 Industrial Parkway South Aurora,
Ontario, Canada, L4G 6X7 Phone: (905) 841-2300 Fax: (905) 841-2244
Web: www.helixbiopharma.com
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