Inovio Pharmaceuticals Reports 2012 Second Quarter Financial Results
BLUE BELL, Pa., Aug. 9, 2012 /PRNewswire/ — Inovio Pharmaceuticals, Inc. (NYSE MKT: INO) today reported financial results for the quarter ended June 30, 2012.
Total revenue was $436,000 and $2.1 million for the three and six months ended June 30, 2012, compared to $2.4 million and $5.5 million for the same periods in 2011.
Total operating expenses were $7.2 million and $13.1 million for the three and six months ended June 30, 2012, compared to $7.6 million and $15.0 million for the same periods in 2011.
The net loss attributable to common stockholders for the three and six months ended June 30, 2012, was $4.1 million, or $0.03 per share, and $12.4 million, or $0.09 per share, as compared with a net loss attributable to common stockholders of $2.8 million, or $0.02 per share, and $5.2 million, or $0.04 per share, for the three and six months ended June 30, 2011.
The decrease in revenue for the comparable periods was primarily due to timing of work performed under the company’s contract with the National Institute of Allergy and Infectious Diseases (NIAID). This contract revenue amounted to $234,000 and $1.7 million for the three and six months ended June 30, 2012, versus $1.7 million and $4.5 million for the same periods in 2011. This NIAID contract, which exceeds $23 million over five years (plus two additional option years), is facilitating Inovio’s development of a universal, preventive HIV DNA vaccine, PENNVAX(®)-GP.
Research and development expenses for the three and six months ended June 30, 2012, were $4.5 million and $8.6 million for the three and six months ended June 30, 2012 as compared to $4.5 million and $8.9 million for the same periods in 2011. General and administrative expenses for the three and six months ended June 30, 2012 were $2.7 million and $5.2 million versus $3.1 million and $6.4 million for the same periods in 2011.
Net Loss Attributable to Common Stockholders
The $1.3 million and $7.2 million increase in net loss for the three and six months ended June 30, 2012, respectively, compared with the same periods in 2011, resulted primarily from a significant (non-cash) change in fair value of common stock warrants, based on a required quarterly mark to market adjustment to reflect changes in the Company’s stock price, and a decrease in grant revenue.
As of June 30, 2012, cash and cash equivalents plus short-term investments in certificates of deposit, mutual funds, and municipal bonds were $19.5 million compared with $30.3 million as of December 31, 2011.
Based on management’s projections and analysis, the Company believes that current cash and cash equivalents plus short-term investments are sufficient to meet its planned working capital requirements into the third quarter of 2013.
During the quarter, Inovio replaced a prior ATM agreement that the Company already had in place with a sales agreement with Cowen and Company, LLC, under which Inovio may from time to time offer and sell common stock with aggregate proceeds of up to $25 million. Inovio may sell its stock through Cowen by methods deemed to be an “at the market” offering (ATM), including sales made through the NYSE MKT or any other existing trading market for the common stock or to or through a market maker.
Inovio’s balance sheet and statement of operations are provided below. Form 10-Q providing the complete 2012 second quarter financial report can be found at: http://ir.inovio.com/secfilings.
During the second quarter, Inovio reported that its SynCon® avian influenza vaccine generated protective HAI titers against six different unmatched strains of H5N1 in a phase I clinical trial – a distinct clinical achievement on Inovio’s path to develop universal influenza vaccines.
Subsequent to the quarter, Inovio treated the first patients in a clinical trial evaluating immune responses in elderly adults immunized with Inovio’s H1N1 SynCon® universal influenza vaccine. This phase I study will evaluate the ability of Inovio’s SynCon® vaccine alone as well as in combination with the 2012 seasonal influenza vaccine to generate: protective levels of immune responses; antigen-specific antibody immune responses against unmatched influenza strains; and T-cell immune responses that may be helpful in fighting influenza. The 65+ age group represents about 90% of annual influenza deaths in the US.
Enrollment is ongoing in Inovio’s phase II clinical study of VGX-3100 for cervical dysplasia. Data is expected in the second half of 2013. Two Inovio collaborators, the University of Southampton and ChronTech Pharma AB, are expected to report interim data from their phase II studies of DNA vaccines for leukemia and hepatitis C virus, respectively, before year end.
Corporate & Business Development
During the second quarter Inovio added to its patent estate of more than 400 worldwide granted and pending patents with two newly granted U.S. patents covering its SynCon® vaccine for cervical dysplasias and cancers caused by human papillomavirus (HPV) as well as its universal vaccine related to H1N1 influenza.
Inovio was awarded a U.S. Department of Defense Small Business Innovation Research Grant to advance a low-cost, non-invasive surface electroporation delivery device and test its utility in combination with Inovio synthetic vaccines against viruses with bioterrorism potential.
Inovio appointed to its Board of Directors an international business management expert, Angel Cabrera, Ph.D., who is president of George Mason University, the largest university in Virginia and former president of the Thunderbird School of Global Management, widely regarded as the world’s leading graduate school of international business.
Inovio is advancing discussions with large pharmaceutical companies with the goal of securing new partnerships to advance the development and commercialization of its SynCon® vaccines.
About Inovio Pharmaceuticals, Inc.
Inovio is revolutionizing vaccines to prevent and treat today’s cancers and challenging infectious diseases. Its SynCon® vaccines are designed to provide universal cross-strain protection against known as well as newly emergent unmatched strains of pathogens such as influenza. These synthetic vaccines, in combination with Inovio’s proprietary electroporation delivery, have been shown in humans to generate best-in-class immune responses with a favorable safety profile. Inovio’s clinical programs include phase II studies for cervical dysplasia, leukemia and hepatitis C virus and phase I studies for influenza and HIV. Partners and collaborators include the University of Pennsylvania, Merck, ChronTech, National Cancer Institute, U.S. Military HIV Research Program, NIH, HIV Vaccines Trial Network, University of Southampton, US Dept. of Homeland Security and PATH Malaria Vaccine Initiative. More information is available at www.inovio.com.
This press release contains certain forward-looking statements relating to our business, including our plans to develop electroporation-based drug and gene delivery technologies and DNA vaccines and our capital resources. Actual events or results may differ from the expectations set forth herein as a result of a number of factors, including uncertainties inherent in pre-clinical studies, clinical trials and product development programs (including, but not limited to, the fact that pre-clinical and clinical results referenced in this release may not be indicative of results achievable in other trials or for other indications, that the studies or trials may not be successful or achieve the results desired, that pre-clinical studies and clinical trials may not commence or be completed in the time periods anticipated, that results from one study may not necessarily be reflected or supported by the results of other similar studies and that results from an animal study may not be indicative of results achievable in human studies), the availability of funding to support continuing research and studies in an effort to prove safety and efficacy of electroporation technology as a delivery mechanism or develop viable DNA vaccines, the adequacy of our capital resources, the availability or potential availability of alternative therapies or treatments for the conditions targeted by the company or its collaborators, including alternatives that may be more efficacious or cost-effective than any therapy or treatment that the company and its collaborators hope to develop, evaluation of potential opportunities, issues involving product liability, issues involving patents and whether they or licenses to them will provide the company with meaningful protection from others using the covered technologies, whether such proprietary rights are enforceable or defensible or infringe or allegedly infringe on rights of others or can withstand claims of invalidity and whether the company can finance or devote other significant resources that may be necessary to prosecute, protect or defend them, the level of corporate expenditures, assessments of the company’s technology by potential corporate or other partners or collaborators, our ability to secure new partnerships and collaborations, capital market conditions,the impact of government healthcare proposals and other factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2011, our Form 10-Q for the quarter ended June 30, 2012, and other regulatory filings from time to time. There can be no assurance that any product in Inovio’s pipeline will be successfully developed or manufactured, that final results of clinical studies will be supportive of regulatory approvals required to market licensed products, or that any of the forward-looking information provided herein will be proven accurate.
INOVIO PHARMACEUTICALS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS June 30, December 31, 2012 2011 ---- ---- (Unaudited) ---------- ASSETS Current assets: Cash and cash equivalents $5,952,143 $17,350,116 Short-term investments 13,487,062 12,863,420 Accounts receivable 432,108 467,909 Accounts receivable from affiliated entity 33,446 38,406 Prepaid expenses and other current assets 598,482 746,049 Prepaid expenses and other current assets from affiliated entity 813,935 441,186 ------- ------- Total current assets 21,317,176 31,907,086 Restricted cash 100,234 100,059 Fixed assets, net 421,519 295,785 Intangible assets, net 8,393,119 9,310,485 Goodwill 10,113,371 10,113,371 Investment in affiliated entity 7,517,596 9,071,513 Investment in common stock warrants 509,800 100,000 Other assets 223,056 208,262 ------- ------- Total assets $48,595,871 $61,106,561 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $3,522,672 $4,318,942 Accounts payable and accrued expenses due to affiliated entity 53,613 20,344 Accrued clinical trial expenses 1,160,643 1,059,372 Common stock warrants 5,038,510 5,176,319 Deferred revenue 41,864 79,502 Deferred revenue from affiliated entity 413,542 388,542 ------- ------- Total current liabilities 10,230,844 11,043,021 Deferred revenue, net of current portion 77,643 80,450 Deferred revenue from affiliated entity, net of current portion 1,774,194 1,961,694 Deferred rent 75,224 80,875 Deferred tax liabilities 78,859 78,859 ------ ------ Total liabilities 12,236,764 13,244,899 ---------- ---------- Stockholders' equity: Inovio Pharmaceuticals, Inc. stockholders' equity: Common stock 134,968 134,968 Additional paid-in capital 258,113,218 257,235,707 Accumulated deficit (222,479,302) (210,091,174) Accumulated other comprehensive income 64,514 35,393 ------ ------ Total Inovio Pharmaceuticals, Inc. stockholders' equity 35,833,398 47,314,894 Non-controlling interest 525,709 546,768 ------- ------- Total stockholders' equity 36,359,107 47,861,662 ---------- ---------- Total liabilities and stockholders' equity $48,595,871 $61,106,561 =========== ===========
INOVIO PHARMACEUTICALS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended Six Months Ended June 30, June 30, --------- --------- 2012 2011 2012 2011 ---- ---- ---- ---- Revenues: License fee and milestone revenue $20,907 $26,456 $45,745 $52,824 License fee and milestone revenue from affiliated 106,250 105,208 212,500 198,958 entity Grant and miscellaneous revenue 308,925 2,288,099 1,870,958 5,273,246 ------- --------- --------- --------- Total revenues 436,082 2,419,763 2,129,203 5,525,028 ------- --------- --------- --------- Operating expenses: Research and development 4,527,086 4,463,978 8,569,665 8,885,777 General and administrative 2,696,909 3,092,386 5,184,997 6,411,618 Gain on sale of assets - - (651,000) (250,000) --- --- -------- -------- Total operating expenses 7,223,995 7,556,364 13,103,662 15,047,395 --------- --------- ---------- ---------- Loss from operations (6,787,913) (5,136,601) (10,974,459) (9,522,367) Other income (expense): Interest and other income, net 41,036 7,799 72,580 9,654 Change in fair value of common stock warrants 3,594,782 4,898,758 46,609 7,230,626 Loss from investment in affiliated entity (992,373) (2,607,227) (1,553,917) (2,977,238) -------- ---------- ---------- ---------- Net loss (4,144,468) (2,837,271) (12,409,187) (5,259,325) Net loss attributable to non-controlling interest 11,289 15,112 21,059 24,553 ------ ------ ------ ------ Net loss attributable to Inovio Pharmaceuticals, $(4,133,179) $(2,822,159) $(12,388,128) $(5,234,772) Inc. Loss per common share - basic and diluted: Net loss per share attributable to Inovio Pharmaceuticals, Inc. stockholders $(0.03) $(0.02) $(0.09) $(0.04) ====== ====== ====== ====== Weighted average number of common shares outstanding -basic and diluted 134,968,394 127,256,364 134,968,394 124,124,645
CONTACTS: Investors: Bernie Hertel, Inovio Pharmaceuticals, 858-410-3101 Media: Jeff Richardson, Inovio Pharmaceuticals, 267-440-4211
SOURCE Inovio Pharmaceuticals, Inc.