Medicago Announces 2012 First Quarter Financial Results
QUEBEC CITY, May 11, 2012 /PRNewswire/ - Medicago Inc. (TSX: MDG), a biopharmaceutical company focused on developing highly effective and competitive vaccines based on proprietary manufacturing technologies and Virus-Like Particles (VLPs), today announced its operational and financial results for the first quarter ended March 31, 2012. The Company's financial statements and management report are available at www.sedar.com and at www.medicago.com.
"In the first quarter of 2012, we continued to demonstrate the importance of our technologies in establishing a strategic alliance with Mitsubishi Tanabe Pharma for at least three vaccines, completing the fourth milestone related to the DARPA project, initiating a research collaboration with Cellectis, and moving ahead with our internal rabies vaccine candidate," said Andy Sheldon, President and Chief Executive Officer of Medicago. "We expect to continue to take valuable steps forward this year including the initiation a Phase I clinical trial for a one-dose H5N1 VLP vaccine, the completion of the remaining two DARPA milestones, continued development of a quadrivalent seasonal flu vaccine, as well as pursuing our efforts to execute additional contracts for our VLP technology."
Corporate and Financial Highlights
During the first quarter of 2012:
- Established a strategic alliance with Mitsubishi Tanabe Pharma Corporation (MTPC) through the execution of a Master Research Collaboration Agreement to develop and commercialize at least three new vaccines. MTPC will provide funding for all research and development costs including commercialization. Medicago will be entitled to receive upfront and milestone payments as well as royalties for each product to be developed under this master agreement. Under the first agreement to develop a Rotavirus Like Particle (RLP) vaccine target, MTPC will have the option to license the RLP vaccine target and assume global development, regulatory and commercialization responsibilities while Medicago will be eligible to receive up to a total of $33 million in upfront and milestone payments as well as royalties on future sales of the RLP product. Medicago received an upfront payment of $3 million in the first quarter of 2012 to begin the initial research on rotavirus. Additional targets under this master agreement are to be selected by Medicago and MTPC at a later date. MTPC was disclosed at the lead investor in the Company's September 2011 equity financing.
- Received the fourth milestone payment of US$3.56 million from the Defense Advanced Research Projects Agency ("DARPA"). This is part of the potential US$21 million DARPA milestone awards to be earned by Medicago to demonstrate the scalable manufacturing of its plant-expressed VLP vaccines in the U.S.A. under a Technology Investment Agreement. Medicago has now received from DARPA US$19.8 million to date for this project, with two milestones remaining.
- Successfully completed initial studies towards the development of a new VLP vaccine candidate for rabies. Results with the rabies VLP vaccine demonstrated that two doses of one or four micrograms induced protective levels of neutralizing antibodies in a mouse model. Medicago expects to move ahead with GMP process development and a GLP toxicology study in 2012 and, following this, a Phase I clinical trial.
- Announced plans to invest approximately $4 million to enhance the capacity of the pilot production facility located in Quebec City, which is expected to accelerate preclinical and clinical development timelines of future product candidates.
- Signed a research agreement with Cellectis plant sciences, a subsidiary of Cellectis SA (Alternext: ALCLS), under which Medicago and Cellectis will collaborate to improve therapeutic proteins expressed from tobacco leaves.
Subsequent to the first quarter:
- Andy Sheldon was named CEO of the Year by the Vaccine Industry Excellence awards at the World Vaccine Congress in Washington DC.
- Successfully completed the research collaboration agreement with a Top 10 global pharmaceutical company for the development of a non-influenza vaccine candidate.
Expected upcoming milestones include:
- Preparation for US Phase IIa clinical trial with quadrivalent seasonal with interim results expected in the first quarter of 2013;
- Completion of the DARPA program ;
- Potential contracts (government, pharmaceutical companies);
- Addition of new pipeline candidates; and
- Initiation of a Phase I clinical trial for a one-dose H5N1 VLP vaccine with a new adjuvant in the second quarter of 2012, run by the Infectious Disease Research Institute (IDRI), with interim data expected in the second half of this year.
The consolidated loss for the three-month period ended December 31, 2011, was $8,987,000 or $0.04 per basic and diluted share. This compares to a loss of $5,051,000 or $0.04 per basic and diluted share for the three-month period ended March 31, 2011. Operating expenses were $9,142,000 in the three-month period ended March 31, 2012, compared to $5,051,000 in 2011. The increase in operating expense of $4,091,000 is mainly explained by the increase in R&D costs, G&A expenses, depreciation of property, plant and equipment related to assets in the US acquired in 2011 in relation with the DARPA project, and financial costs related to the interest on the finance lease for the US facility.
Cash and short-term investments were $36.9 million as at March 31, 2012, a decrease of $3.5 million from December 31, 2011.
As at May 11, 2012, there were 246,670,302 common shares issued and outstanding as well as 10,694,426 stock options outstanding. Warrants outstanding and Unit options outstanding as at May 11, 2012, are in the aggregate of 27,644,236.
Voting Results of Annual Meeting of Shareholders
At the Annual Meeting of Shareholders held today, all matters put before the shareholders were approved, namely the election of directors and the appointment of auditors. The Board of Directors will consist of Randal Chase, Andrew J. Sheldon, Pierre Seccareccia, Jonathan Goodman, Pierre-Marc Johnson, Pierre Des Marais II and Louis P. Vézina. For further details, please see the management proxy circular available on www.sedar.com.
Medicago is a clinical-stage biopharmaceutical company developing novel vaccines and therapeutic proteins to address a broad range of infectious diseases worldwide. The Company is committed to providing highly effective and competitive vaccines and therapeutic proteins based on its proprietary VLP and manufacturing technologies. Medicago is a worldwide leader in the development of VLP vaccines using a transient expression system which produces recombinant vaccine antigens in plants. This technology has potential to offer more potent vaccines with speed and cost advantages over competitive technologies, enabling the development of a vaccine for testing in approximately one month after the identification and reception of genetic sequences from a pandemic strain. This production time frame has the potential to allow vaccination of the population before the first wave of a pandemic, and supply large volumes of vaccine antigens to the world market. Medicago also intends to expand development into other areas such as biosimilars and biodefense products where the benefits of our technologies can make a significant difference. Additional information about Medicago is available at www.medicago.com.
Forward Looking Statements
This news release includes certain forward-looking statements that are based upon current expectations, which involve risks and uncertainties associated with Medicago's business and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions "anticipate", "believe", "plan", "estimate", "expect", "intend", and similar expressions to the extent they relate to Medicago or its management. The forward-looking statements are not historical facts, but reflect Medicago's current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under "Risk Factors and Uncertainties" in Medicago's Annual Information Form filed on March 29, 2012, with the regulatory authorities. Medicago assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.
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