Re: Farmas USA
Threshold Pharmaceuticals Reports Fourth Quarter and Year End 2014 Financial and Operational Results
SOUTH SAN FRANCISCO, CA -- (Marketwired) -- 03/03/15 -- Threshold Pharmaceuticals, Inc. (NASDAQ: THLD), today reported financial results for the fourth quarter and year ended December 31, 2014. Revenue for the fourth quarter and year ended December 31, 2014 was $3.7 million and $14.7 million, respectively. Net loss for the fourth quarter ended December 31, 2014 was $6.0 million, which included the operating loss of $7.6 million and non-cash income of $1.6 million related to changes in the fair value of the Company's outstanding and exercised warrants that was classified as other income (expense). Net loss for the year ended December 31, 2014 was $21.6 million, which included the operating loss of $31.3 million and non-cash income of $9.3 million related to changes in the fair value of the Company's outstanding and exercised warrants. As of December 31, 2014, Threshold had $58.6 million in cash, cash equivalents and marketable securities, with no debt outstanding. In February 2015, the Company completed an underwritten offering of Threshold common stock and warrants. Net proceeds from the offering are expected to be approximately $28.2 million.
"We expect 2015 to be a key year for Threshold," said Barry Selick, Ph.D., Chief Executive Officer of Threshold. "Based on current projections, we expect that the number of protocol-specified events for the pivotal Phase 3 trials of evofosfamide in patients with advanced soft tissue sarcoma as well as in patients with advanced pancreatic cancer (MAESTRO) may be reached in the second half of 2015, with the results of the primary efficacy analyses for both trials to be available shortly thereafter. Our top priorities are to continue to efficiently execute the clinical studies to allow for timely data analyses and to prepare for the potential submission of marketing applications, assuming the data from the trials are supportive. In parallel, we continue to maintain focus on the Phase 2 trial of evofosfamide designed to support registration for the treatment of patients with advanced non-squamous non-small cell lung cancer as well as on multiple other earlier-stage trials in various types of solid tumors and hematological malignancies. Our recently completed financing has strengthened our cash position and should provide adequate funding to initiate our planned proof-of-concept Phase 2 trial of TH-4000, our hypoxia-activated epidermal growth factor receptor tyrosine kinase inhibitor (EGFR-TKI), in patients with EGFR-positive, T790M-negative non-small cell lung cancer in the first half of 2015."
Fourth Quarter and Year End 2014 Financial and Operational Results
Revenue for the fourth quarter and year ended December 31, 2014 was $3.7 million and $14.7 million, respectively, compared to $3.2 million and $12.5 million for the same periods in 2013, respectively. Revenue for the years ended December 31, 2014 and December 31, 2013, related to the amortization of the aggregate of $110 million in upfront and milestone payments earned in 2013 and 2012 from our collaboration with Merck KGaA, Darmstadt, Germany. The revenue from the upfront payment and milestone payments earned under the agreement is being amortized over the relevant performance period, rather than being immediately recognized when the upfront payment and milestone are earned or received.
The net loss for the fourth quarter of 2014 was $6.0 million compared to a net loss of $7.6 million for the fourth quarter of 2013. Included in the net loss for the fourth quarter of 2014 was an operating loss of $7.6 million and non-cash income of $1.6 million compared to an operating loss of $7.8 million and non-cash income of $0.2 million in the fourth quarter of 2013. The net loss for 2014 was $21.6 million compared to a net loss of $28.4 million in 2013. Included in the net loss for 2014 was an operating loss of $31.3 million and non-cash income of $9.3 million compared to an operating loss of $26.0 million and non-cash expense of $2.3 million in 2013. The non-cash income or expense is related to changes in the fair value of the Company's outstanding and exercised warrants that was classified as other income (expense).
Research and development expenses were $8.6 million for the fourth quarter ended December 31, 2014, compared to $8.5 million for the same period in 2013. The increase in research and development expenses, net of reimbursement for Merck KGaA, Darmstadt, Germany's 70% share of total development expenses for evofosfamide (previously known as TH-302), was due primarily to a $0.6 million increase in employee related expenses, including a $0.2 million increase in non-cash stock-based compensation expense, partially offset by a $0.5 million decrease in consulting expenses and clinical development expenses. Research and development expenses were $35.8 million for 2014, compared to $29.3 million in 2013. The increase in research and development expenses, net of reimbursement for Merck KGaA, Darmstadt, Germany's 70% share of total development expenses for evofosfamide, was due primarily to a $3.7 million increase in clinical development expenses, a $0.2 million increase in consulting expenses and an increase of $2.6 million in employee related expenses, including a $0.6 million increase in non-cash stock-based compensation expense.
General and administrative expenses were $2.6 million for the fourth quarter of 2014 versus $2.5 million for the fourth quarter of 2013. The increase in general and administrative expenses was due primarily to an increase in consulting expenses. General and administrative expenses were $10.1 million for 2014 versus $9.2 million for 2013. The increase in general and administrative expenses was due primarily to a $0.8 million increase in consulting expenses and a $0.1 million in employee-related expenses.
Non-cash stock-based compensation expense included in total operating expenses was $1.6 million for the fourth quarter of 2014 versus $1.4 million for the fourth quarter of 2013. Non-cash stock-based compensation expense included in total operating expenses was $5.5 million for 2014 versus $4.9 million for 2013. The increase in stock-based compensation expense was due to the amortization of a greater number of options with higher fair values.
As of December 31, 2014 and 2013, Threshold had $58.6 million and $82.0 million in cash, cash equivalents and marketable securities, respectively. The net decrease of $23.4 million in cash, cash equivalents and marketable securities during 2014 is primarily due to the Company's operating cash requirements for 2014, partially offset by the $12.5 million in a milestone payment received from Threshold's collaboration with Merck KGaA, Darmstadt, Germany and $5.5 million in cash proceeds from the exercise of warrants and the exercise of stock options and purchase rights related to our stock-based equity incentive plans.
Clinical Development Outlook for Company- and Merck KGaA, Darmstadt, Germany-Sponsored Trials of Evofosfamide
The development plan for evofosfamide is designed to investigate its safety and efficacy across a broad range of solid tumors and hematologic malignancies. Evofosfamide is being developed in therapeutic areas supported by preclinical and clinical data and where there is high unmet need for new anti-cancer agents. To date, evofosfamide has been evaluated in more than 1,500 patients with cancer. Threshold anticipates the following development activities related to Company- and Merck KGaA, Darmstadt, Germany-sponsored clinical trials for evofosfamide in 2015:
Continue to efficiently execute the two Phase 3 clinical trials of evofosfamide to allow for timely data analyses and to prepare for the potential submission of marketing applications, assuming the data from the trials are supportive;
Continue to enroll the Phase 2 clinical trial of evofosfamide designed to support registration for the treatment of patients with non-squamous non-small cell lung cancer;
Complete enrollment in the Phase 2 clinical trial of evofosfamide in combination with bortezomib (Velcade®) and low-dose dexamethasone in patients with relapsed or refractory multiple myeloma; and
Continue to enroll patients in the Company's Phase 2 biomarker trial in patients with advanced melanoma.
About Evofosfamide (previously known as TH-302)
Evofosfamide, an investigational hypoxia-activated prodrug, is designed to be activated under tumor hypoxic conditions, a hallmark of many cancers. Areas of low oxygen levels (hypoxia) in solid tumors are due to insufficient blood supply as a result of aberrant vasculature. Similarly, the bone marrow of patients with hematological malignancies has also been shown, in some cases, to be severely hypoxic.
Evofosfamide is currently under evaluation in two Phase 3 trials: one in combination with doxorubicin versus doxorubicin alone in patients with locally advanced unresectable or metastatic soft tissue sarcoma (STS), and the other in combination with gemcitabine versus gemcitabine and placebo in patients with locally advanced unresectable or metastatic pancreatic cancer (the MAESTRO trial). Both Phase 3 trials are being conducted under Special Protocol Assessment (SPA) agreements with the FDA. The FDA and the European Commission have granted evofosfamide Orphan Drug Designation for the treatment of STS and pancreatic cancer. Evofosfamide is also being investigated in a Phase 2 trial designed to support registration for the treatment of non-squamous non-small cell lung cancer, and in earlier-stage clinical trials of other solid tumors and hematological malignancies.
Threshold has a global license and co-development agreement for evofosfamide with Merck KGaA, Darmstadt, Germany, which includes an option for Threshold to co-commercialize in the U.S.
About TH-4000
In September 2014, Threshold licensed exclusive worldwide rights to a development program based on TH-4000 (formerly referred to as PR610 or Hypoxin™) from the University of Auckland. TH-4000 is a hypoxia-activated epidermal growth factor receptor, or EGFR, tyrosine-kinase inhibitor (TKI). TH-4000 is designed to selectively release a potent, irreversible EGFR-TKI in hypoxic tumors. Preclinical and Phase 1 clinical data suggest that plasma concentrations of TH-4000 that are active in EGFR-dependent tumor xenograft models in mice could be attained in patients with an acceptable therapeutic index. Threshold expects to initiate a Phase 2 proof-of-concept study in a subset of molecularly-defined non-small cell lung cancer patients whom Threshold believes may be responsive to TH-4000 in the first half of 2015.
