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MEDICAGO ANNOUNCES 2010 FOURTH QUARTER AND YEAR-END FINANCIAL RESULTS

March 30, 2011

QUEBEC CITY, QC, March 30 /PRNewswire-FirstCall/ –  Medicago Inc. (TSX: MDG), a biotechnology company focused on developing
highly effective and competitive vaccines based on proprietary
manufacturing technologies and Virus-Like Particles, today announced
its operational and financial results for the fourth quarter and year
ended December 31, 2010. The Company’s financial statements and
management report are available at www.sedar.com and at www.medicago.com.

Highlights

Corporate and Product Development

        --  Award of US$21 million from the Defense Advanced Research
            Projects Agency (DARPA) under a Technology Investment Agreement
            to provide scalable manufacturing of its plant-expressed VLP
            vaccines in the U.S.A. and commenced the construction of its
            U.S. vaccine facility. The facility is projected to be
            operational in the fall of 2011.
        --  Selected to participate with the Infectious Disease Research
            Institute on a multimillion DARPA grant for a single dose H5N1
            vaccine
        --  Received US$1M in funding by U.S.-based PATH pursuant to a
            research collaboration agreement. Medicago and PATH will work
            together on a broad coverage influenza vaccine based on
            Medicago's proprietary plant-based Virus-Like Particle (VLP)
            technologies for the developing world.
        --  Discovered a breakthrough method of preparing plant derived
            recombinant proteins and VLPs and filed two international
            patent applications under the Patent Cooperation Treaty (PCT).
        --  Demonstrated cross protection  would be a major competitive
            advantage when administering Influenza vaccines to human
            populations. Medicago has now demonstrated that its avian
            influenza vaccine can cross protect against different strains
            of H5N1 influenza.
        --  Subsequent to year-end, reported positive phase II interim
            results for its clinical trial with its H5N1 avian influenza
            vaccine.  The vaccine was found to be safe, well tolerated and
            also induced a solid immune response.
        --  Subsequent to year-end, received FDA clearance to initiate
            phase I clinical trial for its phase I H1N1 influenza VLP
            vaccine candidate clinical trial in the United States. This
            phase I trial will lead into Medicago's U.S. phase IIa trial
            for its seasonal trivalent vaccine with the recommended H1N1,
            H3N2 and B influenza strains.

Financial

        --  Completed a C$7.5 million equity offering. The proceeds from
            this offering will be mainly used to fund the Company's
            participation in the DARPA project.
        --  Graduated to the Toronto Stock Exchange (the "TSX") from the
            TSX Venture Exchange and listed its common shares on the TSX.

“2010 was a successful year for Medicago. Our rapid, efficacious and
competitive vaccine technology was in our opinion recognized by the
U.S. Department of Defense who awarded us  US$21M. Our U.S. facility is
being constructed and expected to be operational later this year,” said
Andy Sheldon, President and CEO of Medicago. “On the clinical front, we
continued to make key advancements in our pipeline products. We
recently achieved positive phase II interim results from our clinical
evaluation of our pandemic H5N1 Influenza VLP vaccine candidate. We
also achieved FDA clearance to initiate a phase I clinical trial for
our H1N1/seasosanal vaccine candidate.”

“2011 will also prove to be an important year. We will be reporting
final phase II data for our H5N1 vaccine candidate and phase I clinical
data for our seasonal candidate. This data will be followed by the
initiation of a U.S. phase II clinical trial for our seasonal
canadidate. We believe that our proprietary plant-based manufacturing
technology has the potential to transform the speed and economics of
vaccine production. As we are now entering, later-stage clinical
development, we will work to continue to execute potential contracts
with governments and pharmaceutical companies to roll-out our VLP
vaccine technology globally,” added Mr. Sheldon.

Outlook

In the first quarter of 2011, the Company reported positive interim
phase II results for its clinical trial with its H5N1 avian influenza
vaccine. The Company is proceeding with the second part of the phase II
trial with final results expected in Q2 2011. Upcoming milestones
include among others:

        --  Phase II final results with its H5N1 vaccine
        --  Initiation of U.S. phase I clinical trial with its H1N1 vaccine
            / seasonal vaccine. Results are expected in Q2 2011.
        --  Operational U.S. vaccine facility
        --  Initiation of U.S. phase II  clinical trial with trivalent
            seasonal vaccine if authorization granted by FDA
        --  Potential contracts  with governments and pharmaceutical
            companies
        --  Addition of new pipeline candidates (vaccines, biosimlar
            enzymes)

Subsequent event

On March 25, 2011 the Company announced that it has agreed to sell up to
34,117,600 units (each, a “Unit”) at a price of $0.51 per Unit,
representing gross proceeds of $17,399,976 (the “Offering”). Each Unit
is comprised of one common share (a “Common Share”) and one quarter of
one common share purchase warrant (each, a “Warrant”). Each full
Warrant will have an exercise price of $0.75, exercisable for a period
of 24 months following the closing date of the Offering. The Warrants
are subject to an accelerated expiry if, at any time after the closing
of the offering, the published closing trade price of the Common Shares
on the TSX is equal or superior to $1.00 for any 30 consecutive trading
days, in which event the Company may give the holders a written notice
that the Warrants will expire at 5:00 p.m. (Montr©al time) on the 30th
day from the receipt of such notice.

Net proceeds from the Offering will be used for continued clinical
development of the Company’s plant-based manufactured Influenza Virus
Like Particles (“VLP”) vaccines, to fund the development of additional
potential product candidates and for other general corporate and
working capital purposes.  The Offering is expected to close on or
about April 5, 2011, subject to the satisfaction of all necessary
regulatory approvals, including the conditional listing approval of the
Toronto Stock Exchange.

Financial Results

Consolidated loss for the three-month period ended December 31, 2010 was
$4,568,000 or $0.04 per basic and diluted share, compared to a loss of
$3,891,000 or $0.04 per basic and diluted share in the same period in
2009. For the twelve-month period ended December 31, 2010, consolidated
loss amounted to $16,344,000 or $0.13 per basic and diluted share
compared to a loss of $12,475,000 or $0.13 per basic and diluted share
in the same period of 2009. Increase in the loss for the three and
twelve-month period is mainly explained by the increase in R&D expenses
in relation with the H5N1 Phase II clinical trial that is underway and
the H1N1/seasonal vaccine Phase I that has just started.

Cash and short-term investments were $8.5 million as at December 31,
2010.

As at March 29, 2011, there were 138,922,102 common shares issued and
outstanding, 8,725,046 stock options outstanding, 1,203,704 unit
options outstanding and 16,159,586 warrants outstanding.

About Medicago

Medicago is a clinical-stage biotechnology company, developing effective
and competitive vaccines based on proprietary Virus-Like Particles
(VLP) and manufacturing technologies. Medicago is developing VLP
vaccines to protect against pandemic and seasonal influenza, using a
transient expression system which produces recombinant vaccine antigens
in non-transgenic plants. This technology has potential to offer
advantages of speed and cost over competitive technologies. It could
deliver a vaccine for testing in about a month after the identification
and reception of the genetic sequence. This production time frame has
the potential to allow vaccination of the population before the first
wave of a pandemic strikes and to supply large volumes of vaccine
antigens to the world market. 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 “Risks Factors and
Uncertainties” in Medicago’s Annual Information Form filed on March 31,
2011 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: newswire



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