Taxus Cardium Presents Year-End 2013 Financial Results And Recent Developments
SAN DIEGO, April 15, 2014 /PRNewswire/ — Taxus Cardium Pharmaceuticals Group Inc. (Trading Symbol: CRXM) today presented highlights of financial results fiscal year ended December 31, 2013, and other recent developments.
Focus on Gene Therapy and Regenerative Medicine Biologics
The Company recently announced that the U.S.-based Cardium Therapeutics operations will be primarily focused on the clinical and commercial development of its Generx(®) and Excellagen(®) advanced regenerative medicine therapeutics:
Generx(®) (alferminogene tadenovec, Ad5FGF-4) is a Phase 3 angiogenic gene therapy for the potential treatment of patients with Cardiac Microvascular Insufficiency or CMI due to advanced coronary artery disease. CMI is a principal cause of Coronary Microvascular Dysfunction (CMD), a well-recognized clinical condition characterized by functional and structural abnormalities of the microvasculature (smaller blood vessels of the heart), which leads to myocardial ischemia and angina pectoris in the absence of large artery/obstructive disease. CMD, which is also sometimes referred to as microvascular angina, frequently cannot be addressed using traditional surgical approaches such as coronary artery bypass graft (CABG) or percutaneous coronary intervention (PCI, i.e. angioplasty and stents). In particular, many patients (1) have coronary artery disease that is not limited or localized to large vessels, (2) continue to experience angina after CABG or PCI, and/or (3) are not suitable candidates for surgical interventions.
Generx represents a new class of therapeutic designed to address a large and unmet medical need among patients with heart disease. It is estimated that 12% of patients with obstructive coronary artery disease continue to experience angina because their underlying medical condition is not fully addressed or cannot be resolved by chronic drugs or surgical/mechanical interventions. In addition, a recent meta-analysis reported that approximately 20% of patients who have a coronary angiography due to ongoing angina do not have obvious large vessel disease, a condition generally referred to as Cardiac Syndrome X, many of whom are presumed to have coronary disease that is diffuse and/or affects smaller vessels within the heart that are not reachable through surgical intervention. Generx is designed to be a one-time non-surgical treatment that may help many of such patients by directly addressing their underlying microvascular angina, as well as providing a non-surgical option for patients in whom coronary intervention is either contraindicated or not desirable.
Excellagen(®) is an FDA-cleared, pharmaceutically-formulated acellular biological modulator that has been engineered to activate and promote wound healing through the growth of granulation tissue in chronic non-healing diabetic foot, pressure and venous ulcers, as well as other dermal wounds (including traumatic and surgical wounds). We believe that Excellagen is a cost-effective, easy to use professional product that has now been classified for reimbursement purposes by the U.S. Centers for Medicare and Medicaid Services as a unique “skin substitute”- a designation which is consistent with other forms of skin substitutes including living skin equivalents. Excellagen is expected to have additional potential applications for tissue regeneration and implant scaffolding using stem cells and other biologics. To learn more about the Company’s new regenerative medicine focus visit www.cardiumthx.com.
Corporate Development Activities
During 2013 and recently, Cardium initiated a number of important corporate development activities, including a strategic collaboration and funding agreement with Shanxi Taxus Pharmaceuticals Co., Ltd. that is designed to support the international commercial development of Generx and Excellagen and to explore the development of these technologies and business opportunities in the People’s Republic of China. To reflect the inclusion of these new opportunities and funding support, Cardium Therapeutics changed its name to Taxus Cardium Pharmaceuticals Group. In 2013, stockholders approved an institutional funding and a reverse stock split. In addition, reflecting the Company’s strategic focus on regenerative medicine biologics, the Company exchanged its To Go Brands(®) nutraceutical and health sciences operating business for an equity interest in Healthy Brands Collective, a business unit of Cell-nique Corporation, a growing private company acquiring new and innovative health food products, with plans to complete an initial public offering at an appropriate time, which will serve to monetize the Company’s equity position. In addition, the Company has completed its first strategic partnering for LifeAgain, an advanced medical data analytics business, and plans to support this non-core investment through independent external funding sources. Based on these transactions and other actions, the Company has significantly reduced its overall operating cost structure as it primarily focuses on the technology and clinical development of its innovative gene therapy and regenerative medicine biologics.
Generx(®) Angiogenic Gene Therapy Product Candidate
The Generx product candidate (alferminogene tadenovec, Ad5FGF-4) is an angiogenic gene therapy that is being developed as a pioneering treatment for Cardiac Microvascular Insufficiency or CMI in patients with myocardial ischemia and symptomatic chronic stable angina pectoris due to advanced coronary artery disease (CAD). Patients with CMI are no longer responsive to medical therapy, and are not considered suitable candidates for traditional revascularization procedures, either because of their medical condition or because they continue to have persistent exertional angina despite having satisfactory large coronary artery blood flow based on an angiographic evaluation. Coronary Microvascular Dysfunction (CMD) is a well-recognized clinical condition that describes functional and structural abnormalities of the microvasculature that can lead to myocardial ischemia in the absence of large artery/obstructive disease (microvascular angina), and therefore encompasses CMI. Traditional surgical approaches such as coronary artery bypass graft (CABG) and percutaneous coronary intervention (PCI) are designed to address blockages in the large vessels of the heart that can be reached using such methods. However, many patients (1) have CAD that is not limited to large vessels, (2) continue to experience angina after CABG or PCI, and/or (3) are not suitable candidates for surgical interventions. It is believed that patients with CMI have insufficient microvascular blood flow (i.e. within medium to smaller blood vessels) during exertion due to their advanced coronary artery disease and may benefit from Generx therapy to biologically enhance cardiac perfusion by the promotion of collateral vessel formation. Company researchers believe that biologically enhanced perfusion offers the opportunity to reduce angina attacks and improve quality of life for patients with advanced CAD, and large-scale studies and clinical reviews have now shown that increased perfusion can be cardio-protective and improve outcomes following a major adverse cardiac event.
Following a one-time intracoronary catheter-based delivery by an interventional cardiologist in a routine out-patient procedure (that is very similar to an angiography procedure), Generx is designed to drive the localized, short-term cellular expression of FGF-4 protein, which in turn stimulates the release and action of other key growth factors to orchestrate and promote the growth of cardiac microvascular circulation (functional collateral network) in ischemic cardiac tissue through the enlargement of pre-existing collateral arterioles (arteriogenesis) and the formation of new capillary vessels (angiogenesis). An independent long-term prospective study has demonstrated the importance of collateral circulation beyond simply the relief of angina and provided further support of the potential for long term benefits from Generx therapy. Upon completion of the ongoing ASPIRE international clinical study, Generx will have been the subject of five randomized and controlled multi-center clinical studies involving approximately 750 patients at over 100 medical centers in the United States, Canada, Western Europe, South America and the Russian Federation. The combined clinical study data will represent one of the largest clinical and regulatory gene therapy dossiers in the world, and suggests that Generx appears to be safe and well tolerated, and is potentially capable of improving myocardial perfusion in patients with myocardial ischemia due to advanced coronary artery disease. To learn more about the Generx angiogenic gene therapy product candidate visit http://www.cardiumthx.com/generx.html.
Excellagen(®) FDA-Cleared Wound Care Product
Excellagen is a homogenate of purified bovine dermal collagen (Type I) in its native 3-dimensional fibrillar configuration, physiologically formulated as a sterile professional-use syringe, capable of providing a structural scaffold for cellular infiltration and wound granulation. Excellagen can activate platelets, triggering release of essential growth factors and is believed to function as an acellular biological modulator to activate the wound healing process and significantly accelerate the growth of granulation tissue. Excellagen’s FDA clearance provides for very broad labeling including partial and full-thickness wounds, pressure ulcers, venous ulcers, diabetic ulcers, chronic vascular ulcers, tunneled/undermined wounds, surgical wounds (donor sites/graft, post-Mohs surgery, post-laser surgery, podiatric, wound dehiscence), trauma wounds (abrasions, lacerations, second-degree burns and skin tears) and draining wounds.
Excellagen is intended for professional use following standard debridement procedures in the presence of blood cells and platelets, which are involved with the release of endogenous growth factors. Excellagen’s unique fibrillar collagen formulation is topically applied through easy-to-control, pre-filled sterile syringes and is designed for application at one-week intervals. Effective January 1, 2014, the Centers for Medicare and Medicaid Services (CMS) assigned Excellagen a unique, product-specific Q code (Q4149), classifying Excellagen as a skin substitute, indicated for the treatment of hard to heal wounds such as diabetic foot ulcers and pressure ulcers as well as other dermal wounds. Consistent with the Company’s long-term business strategy, as previously reported, we not plan to establish an internal marketing and sales force for commercialization of Excellagen, but rather to fully credentialize Excellagen in preparation for the completion of strategic partnerings within various vertical channel market opportunities or asset monetization. The Company has continued to pursue a CE mark certification for Excellagen, has fully responded to all information requested by the notified body, and looks forward to completing this process. For more information, visit www.excellagen.com.
In addition to its application for the treatment of chronic non-healing dermal wounds, Excellagen’s pharmaceutically formulated collagen has been engineered to serve as a biologics delivery platform, enabling multiple device, tissue scaffolding and therapeutic product extensions for tissue regeneration based on stem cells, biologics, peptides and small molecule drugs. It is believed that the application of Excellagen as a mesenchymal stem cell delivery platform can facilitate wound healing, which is the subject of ongoing preclinical studies.
Financial Report for 2013
After adjusting for the sale of the Company’s To Go Brands® operating business, revenues for the year ended December 31, 2013 totaled $109,000, compared to revenues of $59,000 for the year ended December 31, 2012. The Company reported a net loss from continuing operations totaling $6.9 million for the year ended 2013, compared to the prior year of $8.3 million, representing a reduction of $1.4 million, or 17%. A net loss from discontinued operations totaled $2.0 million was reported in 2013, reflecting the operating losses of the To Go Brands business during the period we owned it, and a $1.1 million write-off of technology licenses relating to the nutraceutical product line acquired with Cardium stock in 2010 and 2011. The net loss for 2013 totaled $8.9 million ($1.33 per share), compared to a net loss of $8.3 million ($1.41 per share) in 2012. For the year ended December 31, 2013, research and development expenses totaled $2.0 million, and selling, general and administrative expenses were $4.9 million, compared to $2.6 million and $5.7 million, respectively, for 2012. The decreases in selling, general and administrative expenses, and research and development expenses, were primarily due to reductions in research, testing and marketing activities for Excellagen and overall reductions in corporate overhead, staffing and salary reductions. Cardium ended the 2013 year with a working capital deficit of $1.1 million, compared to working capital from continuing operations of $3.5 million in 2012. After adjusting for the stockholder approved reverse stock split, the total shares of Common Stock outstanding at December 31, 2013 were 8.8 million, and there were an additional 1.5 million shares of Common Stock issuable upon the conversion of Series A Preferred Stock into Common Stock as of December 31, 2013, for approximately 10.3 million total shares.
The Company also indicated that similar to 2012, the audit opinion accompanying its consolidated financial statements for the year ended December 31, 2013, will contain a going concern qualification from its independent registered public accounting firm, Marcum LLP. Consistent with its business strategy and as outlined in this press release, Cardium plans to raise additional funds through the sale of additional equity to Shanxi Taxus or other investors, the strategic sale or monetization of operating units, entering into strategic licensing agreements, and/or other financing transactions.
Except for statements of historical fact, the matters discussed in this press release are forward looking and reflect numerous assumptions and involve a variety of risks and uncertainties, many of which are beyond our control and may cause actual results to differ materially from expectations. For example, there can be no assurance that results or trends observed in one clinical study or procedure will be reproduced in subsequent studies or in actual use; that new clinical studies will be successful or will lead to approvals or clearances from health regulatory authorities, or that approvals in one jurisdiction will help to support studies or approvals elsewhere; that the company can attract suitable commercialization partners for our products or that we or partners can successfully commercialize them; that our product or product candidates will not be unfavorably compared to competitive products that may be regarded as safer, more effective, easier to use or less expensive or blocked by third party proprietary rights or other means; that the products and product candidates referred to in this report or in our other reports will be successfully commercialized and their use reimbursed, or will enhance our market value; that new product opportunities or commercialization efforts will be successfully established; that third parties on whom we depend will perform as anticipated; that we can raise sufficient capital from partnering, monetization or other fundraising transactions to maintain our stock exchange listing or adequately fund ongoing operations; or that we will not be adversely affected by these or other risks and uncertainties that could impact our operations, business or other matters, as described in more detail in our filings with the Securities and Exchange Commission. We undertake no obligation to release publicly the results of any revisions to these forward-looking statements to reflect events or circumstances arising after the date hereof.
Copyright 2014 Cardium Therapeutics, Inc. All rights reserved.
Cardium Therapeutics(®), Generx(®),( )Cardionovo(®), Tissue Repair(TM), Excellagen(®), Excellarate(TM), Genedexa(TM), and LifeAgain(TM), are trademarks of Cardium Therapeutics, Inc., Tissue Repair Company or LifeAgain Insurance Solutions Inc. Other trademarks belong to their respective owners.
Taxus Cardium Pharmaceuticals Group, Inc. Selected Condensed Consolidated Results of Operations The year ended December 31, ------------------------ 2013 2012 ---- ---- Product sales $109,200 $59,409 Cost of goods sold (69,160) (54,151) ------- ------- Gross profit 40,040 5,258 Operating expenses Research and development (2,037,370) (2,581,094) Selling, general and administrative (4,908,919) (5,717,985) Loss from operations (6,906,249) (8,293,821) ---------- ---------- Interest income (expense), net (554) 2,550 Change in fair value of derivative liabilities --- 64,157 --- ------ Net loss from continuing operations $(6,906,803) $(8,227,114) Net Loss from discontinued operations (2,007,490) (96,196) ---------- ------- Net Loss $(8,914,293) $(8,323,310) ----------- =========== Deemed dividend on preferred stock $(405,872) $ --- Net loss applicable to common stockholders $(9,320,165) $(8,323,310) =========== =========== Net loss per common share - basic and diluted Net loss from continued operations $(1.04) $(1.39) Net loss from discontinued operations (0.29) (0.02) ----- ----- Net loss per share - basic and diluted $(1.33) $(1.41) ====== ====== Weighted average common shares outstanding - basic and diluted 6,995,676 5,922,717
Selected Condensed Consolidated Balance Sheet Data December 31, December 31, 2013 2012 ---- ---- Cash and cash equivalents $22,489 $2,182,118 Accounts receivable __ 22,320 Inventory 159,831 682,094 Prepaid expenses and other current assets 309,200 403,705 Property and equipment, net 30,196 52,115 Other long- term assets 2,264,661 1,809,126 Assets of discontinued operations --- 2,657,400 --------- Total assets $2,786,377 $7,808,878 ========== ========== Accounts payable and accrued liabilities $1,601,286 $801,008 Liabilities of discontinued operations --- 642,080 --- ------- Total liabilities 1,601,286 1,443,088 Stockholder's equity 1,185,091 6,365,790 Total liabilities and stockholder's equity $2,786,377 $7,808,878 ========== ==========
SOURCE Taxus Cardium Pharmaceuticals Group Inc.