Exhibit 99.1
Opexa
Therapeutics Reports Third Quarter 2013 Financial Results and Provides
Corporate Update
THE WOODLANDS, Texas--(BUSINESS WIRE)--November 7, 2013--Opexa
Therapeutics, Inc. (NASDAQ: OPXA), a biotechnology company developing
Tcelna®, a novel T-cell immunotherapy for the
treatment of multiple sclerosis (MS), today reported financial results
for the third quarter ended September 30, 2013 and provided an overview
of the Company’s recent corporate developments.
Recent highlights include:
-
Clinical
-
As of November 6, 2013, enrolled 100 patients in the Phase IIb
“Abili-T” clinical study of Tcelna (imilecleucel-T) in patients
with Secondary Progressive Multiple Sclerosis (SPMS). The Abili-T
clinical trial is a randomized, double-blind, placebo-controlled
study designed to enroll 180 patients at approximately 33 leading
clinical sites in the U.S. and Canada.
-
Furthered the accumulation of comprehensive patient data to
support Opexa’s Immune Monitoring Program initiative in
conjunction with the Abili-T trial, including the potential
identification of biomarkers for SPMS and further understanding of
the immunopathology of SPMS.
-
Financial
-
Reported cash and cash equivalents of $20,172,485 as of September
30, 2013.
-
Closed an underwritten public offering of 12 million shares of
common stock in August 2013 and sold an additional 900,000 shares
of common stock in September 2013 through the exercise of an
over-allotment option granted to the underwriter of the public
offering, with aggregate gross proceeds of $19.4 million, or net
proceeds of approximately $17.4 million after deducting
underwriting discounts and commissions and estimated offering
expenses.
-
Eliminated debt on Opexa’s consolidated balance sheet through the
conversion into common stock of the remaining July 2012
convertible secured promissory notes in an aggregate principal
amount of $3.185 million.
-
Terminated the remaining $500,000 deposit control agreement in
connection with conversion of the July 2012 convertible secured
promissory notes, resulting in the funds being reported as cash
and cash equivalents on the consolidated balance sheet instead of
as restricted cash.
-
Operational
-
Strengthened the team with the addition of several talented
individuals dedicated to furthering the Company’s development
initiatives, including enhancing the manufacturing and delivery of
Tcelna.
“We recently reached a major milestone by enrolling the 100th
patient into the Abili-T study," commented Neil K. Warma, Opexa’s
President and Chief Executive Officer. "With the recent addition of
three new clinical trial sites in the U.S., we now have 33 centers
across North America participating in the Abili-T study,” added Mr.
Warma. “We expect to complete enrollment of 180 patients in early 2014
and release the top-line results of the study in the middle of 2016.”
“On the financial front, we focused our efforts this quarter on
strengthening and cleaning up our balance sheet,” commented Karthik
Radhakrishnan, Opexa’s Chief Financial Officer. “Following the receipt
of net proceeds of approximately $17.4 million through our August 2013
public offering and the subsequent exercise of the underwriters’
over-allotment option, we ended the quarter with over $20 million of
cash and cash equivalents. In addition, we eliminated the remaining
$3.185 million principal amount of the July 2012 convertible secured
promissory notes through the conversion of principal and accrued
interest into shares of our common stock,” added Mr. Radhakrishnan.
“The Company’s cash position is the highest it has been at any previous
quarter-end in its recent history, and this positions Opexa to pursue
shareholder value by continuing to execute on our clinical mission,”
added Mr. Warma. “With the recent infusion of capital along with the
conversion of the July 2012 Notes into common stock, our cash position
now takes us into the first quarter of 2015.”
Third Quarter Financial Results
Opexa reported revenue of $348,837 and $917,774 for the three and nine
months ended September 30, 2013, respectively. The revenue is related to
the recognized portion of the $5 million upfront payment received from
Merck Serono in conjunction with the Option and License Agreement
entered into between Opexa and Merck Serono during February 2013. The
unearned revenue is being recognized over the expected term of Merck’s
period to exercise its option to license Tcelna for MS. No revenues were
recognized during the three and nine months ended September 30, 2012.
Research and development expenses were $2,494,463 and $6,338,859 for the
three and nine months ended September 30, 2013, respectively, compared
with $1,455,938 and $4,504,243 for the three and nine months ended
September 30, 2012, respectively. The increase was primarily due to
costs associated with the initiation of clinical sites and increasing
enrollment of patients for the Abili-T clinical study, including
increases in manufacturing, the number of employees and registration
costs in connection with the Company’s patent portfolio. Expenses were
partially offset by costs associated with the training and qualification
activities preceding the commencement of the Abili-T clinical trial in
the second half of 2012.
General and administrative expenses for the three and nine months ended
September 30, 2013 were $626,668 and $2,479,708, respectively, compared
with $532,474 and $1,878,236 for the three and nine months ended
September 30, 2012, respectively. The increase was primarily due to a
modest increase in employees to support the ongoing clinical trial and
increases in legal and stock compensation expenses. The increase for the
nine months ended September 30, 2013 compared to the nine months ended
September 30, 2012 was partially offset by a decrease in other
professional fees.
Depreciation and amortization expense for the three and nine months
ended September 30, 2013 was $90,935 and $258,144, respectively,
compared with $81,514 and $225,365 for the three and nine months ended
September 30, 2012, respectively. The increase in expense for the three
months ended September 30, 2013 compared to the three months ended
September 30, 2012 is primarily due to increases in depreciation for
laboratory and manufacturing equipment acquired during 2013 and
leasehold improvements during 2013 to support increased development
activities. The increase in expenses for the nine months ended September
30, 2013 compared to the nine months ended September 30, 2012 is
primarily due to increases in depreciation for laboratory and
manufacturing equipment acquired during 2012 and 2013, leasehold
improvements during 2013 and software obtained during 2012 to support
increased development activities.
Interest expense for the three and nine months ended September 30, 2013
was $346,239 and $2,267,293, respectively, compared with $151,029 and
$152,002 for the three and nine months ended September 30, 2012,
respectively. Interest expense for the three months ended September 30,
2013 was primarily related to the amortized debt discount on the
remaining July 2012 convertible secured promissory notes for the three
months through the conversion date of September 24, 2013 and the
amortization of the financing fees over the term of the July 2012 Notes
for the three months through the conversion date. Interest expense for
the three months ended September 30, 2012 related to the amortized debt
discount and interest on the July 2012 Notes and the amortization of the
financing fees over the term of the Notes. Interest expense for the nine
months ended September 30, 2013 primarily related to the amortized debt
discount and interest on both the July 2012 Notes and the January 2013
convertible promissory notes and the amortization of the financing fees
over the term of the notes. Interest expense for the nine months ended
September 30, 2012 primarily related to the amortized debt discount and
interest on the July 2012 Notes.
Interest income for the three and nine months ended September 30, 2013
was $4,448 and $9,388, respectively, compared with $61 and $256 for the
three and nine months ended September 30, 2012, respectively.
Loss on extinguishment of debt related to the September 24, 2013
conversion of the remaining July 2012 convertible secured promissory
notes was $2,518,912 for both the three and nine months ended September
30, 2013. There was no loss on extinguishment of debt recorded for
either the three or nine months ended September 30, 2012.
Opexa reported a net loss for the three and nine months ended September
30, 2013 of $5.72 million, or ($0.39) per share, and $12.9 million, or
($1.29) per share, respectively. For the same three and nine month
period ended September 30, 2012, Opexa reported a net loss of $2.36
million, or ($0.40) per share, and $6.9 million, or ($1.20) per share,
respectively.
Cash and cash equivalents were $20,172,485 as of September 30, 2013,
compared to $592,004 as of December 31, 2012. Inclusive of the $5
million upfront payment received from Merck Serono in conjunction with
the License and Option Agreement, the Company’s financing activities
generated approximately $27 million in net proceeds for the nine months
ended September 30, 2013.
For additional information please see Opexa’s Quarterly Report on Form
10-Q filed today with the SEC.
Conference Call and Webcast Details
Opexa will conduct a conference call and webcast to provide a corporate
update and discuss the financial results at 5:00 p.m. Eastern Time
today. To participate in the conference call, dial in approximately ten
minutes before the scheduled 5:00 p.m. time to (253) 237-1170 or toll
free at (877) 372-0867. Please reference conference ID 94585914 or the
Opexa Therapeutics Earnings Call.
A live webcast of the call can also be accessed via the webcast link on
the Investor Relations page of Opexa’s website (www.opexatherapeutics.com).
About Opexa
Opexa’s mission is to lead the field of Precision Immunotherapy™ by
aligning the interests of patients, employees and shareholders. The
Company’s leading therapy candidate, Tcelna®, is a personalized T-cell
immunotherapy that is in a Phase IIb clinical development program (the
Abili-T trial) for the treatment of Secondary Progressive MS. Tcelna is
derived from T-cells isolated from the patient’s peripheral blood,
expanded ex vivo, and reintroduced into the patients via subcutaneous
injections. This process triggers a potent immune response against
specific subsets of autoreactive T-cells known to attack myelin.
About Multiple Sclerosis (MS)
Multiple Sclerosis is a chronic, inflammatory condition of the central
nervous system and is the most common, non-traumatic, disabling
neurological disease in young adults. It is estimated that approximately
two million people have MS worldwide.
While symptoms can vary, the most common symptoms of MS include blurred
vision, numbness or tingling in the limbs and problems with strength and
coordination. The relapsing forms of MS are the most common. The
Secondary Progressive form of MS represents about a third of the MS
patient population.
About Tcelna
Tcelna® is a potential personalized therapy that is under development to
be specifically tailored to each patient's disease profile. Tcelna is
manufactured using ImmPath™, Opexa's proprietary method for the
production of a patient-specific T-cell immunotherapy, which encompasses
the collection of blood from the MS patient, isolation of peripheral
blood mononuclear cells, generation of an autologous pool of
myelin-reactive T-cells (MRTCs) raised against selected peptides from
myelin basic protein (MBP), myelin oligodendrocyte glycoprotein (MOG)
and proteolipid protein (PLP), and the return of these expanded,
irradiated T-cells back to the patient. These attenuated T-cells are
reintroduced into the patient via subcutaneous injection to trigger a
therapeutic immune system response.
Opexa is currently conducting a Phase IIb study of Tcelna. Named
“Abili-T,” the trial is a randomized, double-blind, placebo-controlled
clinical study in patients who demonstrate evidence of disease
progression with or without associated relapses. The trial is expected
to enroll 180 patients at approximately 33 leading clinical sites in the
U.S. and Canada with each patient receiving two annual courses of Tcelna
treatment consisting of five subcutaneous injections per year. The
trial’s primary efficacy outcome is the percentage of brain volume
change (atrophy) at 24 months. Study investigators will also measure
several important secondary outcomes commonly associated with MS,
including disease progression as measured by the Expanded Disability
Status Scale (EDSS), annualized relapse rate and changes in disability
as measured by EDSS and the MS Functional Composite.
For more information visit the Opexa Therapeutics website at www.opexatherapeutics.com.
Cautionary Statement Relating to Forward-Looking Information for the
Purpose of "Safe Harbor" Provisions of the Private Securities Litigation
Reform Act of 1995
This earnings release contains forward-looking statements which are made
pursuant to the safe harbor provisions of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. Statements contained in this release, other than
statements of historical fact, constitute "forward-looking statements."
The words "expects," "believes," "anticipates," "estimates," “enables,”
"may," "could," "intends," “positions,” and similar expressions are
intended to identify forward-looking statements. Forward-looking
statements do not constitute guarantees of future performance. Investors
are cautioned that statements which are not strictly historical
statements, including, without limitation, statements regarding current
or future financial payments, returns, royalties, performance and
position, management’s strategy, plans and objectives for future
operations, plans and objectives for product development, plans and
objectives for present and future clinical trials and results of such
trials, plans and objectives for regulatory approval, litigation,
intellectual property, product development, manufacturing plans and
performance, and management’s initiatives and strategies, and the
financing and development of the Company's product candidate, Tcelna
(imilecleucel-T), constitute forward-looking statements. Such
forward-looking statements are subject to a number of risks and
uncertainties that could cause actual results to differ materially from
those anticipated. These risks and uncertainties include, but are not
limited to, risks associated with: market conditions; our capital
position; our ability to compete with larger, better financed
pharmaceutical and biotechnology companies; new approaches to the
treatment of our targeted diseases; our expectation of incurring
continued losses; our uncertainty of developing a marketable product;
our ability to raise additional capital to continue our development
programs (including to undertake and complete any ongoing or further
clinical studies for Tcelna), including in this regard our ability to
satisfy various conditions required to access the financing potentially
available under the purchase agreements with Lincoln Park Capital Fund,
LLC (“Lincoln Park”) (such as the minimum closing price for our common
stock and the requirement for an ongoing trading market for our stock);
our ability to raise additional capital through the sale of shares of
our common stock under the purchase agreements with Lincoln Park or
under our at-the-market (ATM) facility; our ability to maintain
compliance with NASDAQ listing standards; the success of our clinical
trials (including the Phase IIb trial for Tcelna in secondary
progressive MS which, depending upon results, may determine whether Ares
Trading SA (“Merck”) elects to exercise its option for an exclusive
license to Tcelna for the treatment of MS (the “Option”)); whether Merck
exercises its Option and, if so, whether we receive any development or
commercialization milestone payments or royalties from Merck pursuant to
the Option; our dependence (if Merck exercises its Option) on the
resources and abilities of Merck for the further development of Tcelna;
the efficacy of Tcelna for any particular indication, such as for
relapsing remitting MS or secondary progressive MS; our ability to
develop and commercialize products; our ability to obtain required
regulatory approvals; our compliance with all Food and Drug
Administration regulations; our ability to obtain, maintain and protect
intellectual property rights (including for Tcelna); the risk of
litigation regarding our intellectual property rights or the rights of
third parties; the success of third party development and
commercialization efforts with respect to products covered by
intellectual property rights that we may license or transfer; our
limited manufacturing capabilities; our dependence on third-party
manufacturers; our ability to hire and retain skilled personnel; our
volatile stock price; and other risks detailed in our filings with the
SEC. These forward-looking statements speak only as of the date made. We
assume no obligation or undertaking to update any forward-looking
statements to reflect any changes in expectations with regard thereto or
any change in events, conditions or circumstances on which any such
statement is based. You should, however, review additional disclosures
we make in our Annual Reports on Form 10-K, Quarterly Reports on Form
10-Q, and Current Reports on Form 8-K filed with the SEC.
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|
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OPEXA THERAPEUTICS, INC.
(a development stage company)
|
|
|
|
Statements of Expenses Data (unaudited):
|
|
`
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Option Revenue
|
|
|
|
$
|
348,837
|
|
|
$
|
-
|
|
|
$
|
917,774
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
|
$
|
2,494,463
|
|
|
$
|
1,455,938
|
|
|
$
|
6,338,859
|
|
|
$
|
4,504,243
|
|
|
General and administrative
|
|
|
|
|
626,668
|
|
|
|
532,474
|
|
|
|
2,479,708
|
|
|
|
1,878,236
|
|
|
Depreciation and amortization
|
|
|
|
|
90,935
|
|
|
|
81,514
|
|
|
|
258,144
|
|
|
|
225,365
|
|
|
Loss on disposal of assets
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Operating loss
|
|
|
|
|
(2,863,229
|
)
|
|
|
(2,069,926
|
)
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|
|
(8,158,937
|
)
|
|
|
(6,607,844
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
|
|
4,448
|
|
|
|
61
|
|
|
|
9,388
|
|
|
|
256
|
|
|
Other income, net
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
37,910
|
|
|
|
-
|
|
|
Loss on extinguishment of debt
|
|
|
|
|
(2,518,912
|
)
|
|
|
-
|
|
|
|
(2,518,912
|
)
|
|
|
-
|
|
|
Loss on derivative instruments
|
|
|
|
|
-
|
|
|
|
(136,889
|
)
|
|
|
-
|
|
|
|
(136,889
|
)
|
|
Interest expense
|
|
|
|
|
(346,239
|
)
|
|
|
(151,029
|
)
|
|
|
(2,267,293
|
)
|
|
|
(152,002
|
)
|
|
Net loss
|
|
|
|
$
|
(5,723,932
|
)
|
|
$
|
(2,357,783
|
)
|
|
$
|
(12,897,844
|
)
|
|
$
|
(6,896,479
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per share
|
|
|
|
$
|
(0.39
|
)
|
|
$
|
(0.40
|
)
|
|
$
|
(1.29
|
)
|
|
$
|
(1.20
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding
|
|
|
|
|
14,721,474
|
|
|
|
5,762,028
|
|
|
|
10,011,453
|
|
|
|
5,762,028
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Selected Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
2013
(unaudited)
|
|
December 31,
2012
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
20,172,485
|
|
|
$
|
592,004
|
|
|
|
|
|
|
Other current assets
|
|
|
|
|
1,304,146
|
|
|
|
1,077,546
|
|
|
|
|
|
|
Fixed assets, net
|
|
|
|
|
1,226,511
|
|
|
|
1,265,041
|
|
|
|
|
|
|
Restricted cash
|
|
|
|
|
-
|
|
|
|
1,000,000
|
|
|
|
|
|
|
Deferred financing costs, net
|
|
|
|
|
-
|
|
|
|
211,479
|
|
|
|
|
|
|
Other long term assets
|
|
|
|
|
85,047
|
|
|
|
-
|
|
|
|
|
|
|
Total assets
|
|
|
|
|
22,788,189
|
|
|
|
4,146,070
|
|
|
|
|
|
|
Total current liabilities
|
|
|
|
|
3,365,965
|
|
|
|
885,975
|
|
|
|
|
|
|
Notes payable, net
|
|
|
|
|
-
|
|
|
|
376,763
|
|
|
|
|
|
|
Deferred revenue
|
|
|
|
|
2,686,878
|
|
|
|
-
|
|
|
|
|
|
|
Total stockholders' equity
|
|
|
|
|
16,735,346
|
|
|
|
2,883,332
|
|
|
|
|
|
CONTACT:
Opexa Therapeutics, Inc.
Karthik Radhakrishnan
Chief
Financial Officer
281-775-0600
or
Investor Relations:
The
Trout Group
Adam Cutler
646-378-2936
opexa@troutgroup.com
