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Last updated on April 16, 2014 at 7:51 EDT

Medicago Announces 2013 Second Quarter Financial Results

August 9, 2013

QUEBEC CITY, Aug. 9, 2013 /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 second quarter ended June 30, 2013. The
Company’s financial statements and management report are available at www.sedar.com and at www.medicago.com.

Financial Results

For the three and six-month period ended June 30, 2013, the Company had
revenues of $918,000 and $1,337,000, generated from the Master Research
Collaboration Agreement with Mitsubishi Tanabe Pharma Corporation
(“MTPC”) for the development of a first product, a Rotavirus Like
Particle (RLP) vaccine target; a joint research agreement with TRIA
Bioscience Corporation as part of the license agreement signed by
Medicago with Immune Design under which Immune Design has granted
Medicago a worldwide, non-exclusive licence to research, develop and
commercialize GLA as a component of its VLP-based vaccines in the field
of pandemic influenza, and the successful completion of Medicago’s
research collaboration agreement with a top 10 global pharmaceutical
Corporation.

Net loss for the three and six-month period ended June 30, 2013, was
$9,073,000 or $0.04 per basic and diluted share and $17,789,000 or
$0.07 per basic and diluted share, compared to a net loss of $8,099,000
or $0.04 per basic and diluted share and $17,087,000 or $0.07 per basic
and diluted share for the three and six-month periods ended June 30,
2012.

Cash and short-term investments were $8.9 million as at June 30, 2013, a
decrease of $2.4 million from December 31, 2012.

As at August 9, 2013, there were 263,229,248 common shares issued and
outstanding, 12,345,714 stock options outstanding as well as 7,163,523
warrants outstanding as at August 9, 2013 are in the aggregate of
282,738,486.

Medicago announces agreement to be acquired by Mitsubishi Tanabe Pharma
Corporation

On July 12, 2013, Medicago announced that it has entered into a
definitive arrangement agreement with Mitsubishi Tanabe Pharma
Corporation (“Mitsubishi Tanabe Pharma” or “MTPC”) whereby MTPC will
acquire all of the issued and outstanding common shares (“Shares”) of
Medicago, other than the Shares currently held by Philip Morris
Investments B.V. (“PMI”) an affiliate of Philip Morris International
Inc. and MTPC, for $1.16 in cash per Share (the “Purchase Price”). 
Upon completion of the transaction, Medicago will be jointly owned by
MTPC (60%) and PMI (40%). The transaction represents a total enterprise
value of approximately $357 million, including the assumption of
existing indebtedness, for 100% of Medicago.

The completion of the transaction is subject to court approval pursuant
to the Business Corporations Act (Québec) and the approval of
Medicago’s shareholders. The transaction is subject to Regulation
61-101 and the implementation of the arrangement will be subject to the
approval of 66 2/3% of the votes cast by shareholders present in person
or by proxy at the special meeting of shareholders of Medicago and by
holders of more than 50% of the votes cast by Medicago’s minority
shareholders being all shareholders excluding MTPC, PMI and any of
their respective affiliates. The Board of Directors of Medicago unanimously recommends that
Shareholders vote in favour of the Arrangement.

The Company has mailed a management information circular to its
shareholders, a copy of which can be found on Medicago’s website at www.medicago.com or at www.sedar.com, for special shareholders’ meeting to be held on  August 29, 2013. The
transaction is also subject to customary closing conditions, including
receipt of all regulatory approvals, and is expected to close by
mid-September 2013. Shareholders who have any questions regarding the
Arrangement or require assistance with voting may contact Medicago’s
proxy solicitation agent, Laurel Hill Advisory Group at 1-877-452-7184
toll free or by email at assistance@laurelhill.com.

Highlights

During the second quarter of 2013:

        --  Announced positive phase I clinical results for its H5N1
            vaccine in a trial run by IDRI. The vaccine was found to be
            safe and well-tolerated and induced a solid immune response
            exceeding the three CHMP (Committee for Medicinal Products for
            Human Use) immunogenicity criteria for licensure of influenza
            vaccines. The vaccine was tested in three different
            configurations: using IDRI's Glucopyranosyl Lipid A ("GLA")
            formulated adjuvant, given both intramuscularly and
            intradermally, and using alum intramuscularly. All three
            configurations exceeded the CHMP criteria.
        --  Raised $3.5 million through a private placement of 6.25 million
            common shares.
        --  Successfully produced a VLP vaccine candidate for the H7N9
            virus responsible for recent influenza outbreak in China and
            first in the world to report positive interim preclinical
            results
        --  Produced a plant-based Rotavirus VLP vaccine candidate
            comprising all four structural antigens of rotavirus (VP2, VP4,
            VP6 and VP7) using Medicago's plant-based manufacturing
            platform.
        --  Was granted a patent for Influenza Virus-Like Particles in
            Plants
        --  Received authorization from Health Canada and commenced Phase
            II clinical trial for an H5N1 vaccine

Outlook for the remainder of 2013

        --  Closing of the transaction with MTPC, following the approval by
            the shareholders and receipt of all regulatory approvals, is
            expected to occur by mid-September 2013
        --  Interim data from a Phase II H5N1 clinical trial expected in
            the second half of this year
        --  Initiation of a US Phase II clinical trial for a quadrivalent
            seasonal influenza vaccine with interim data expected in the
            second half of this year.

About Medicago

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 28,
2013, 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.

SOURCE Medicago Inc.


Source: PR Newswire