AVI BioPharma, Inc. (NASDAQ: AVII)
- Duchenne Muscular Dystrophy (DMD) and Infectious Disease
Programs Continue to Advance in Clinical Development
- Strong Dataset Presented on AVI's Lead Drug Candidate
Eteplirsen, Demonstrating Restoration of Dystrophin
- Long-Term Treatment Study with Eteplirsen Ongoing with 48-Week
Dataset Expected Later This Year
AVI BioPharma, Inc. (NASDAQ: AVII), a developer of RNA-based
therapeutics, today reported financial results for the three months
ended March 31, 2012, and provided an update of recent corporate
developments.
"We have achieved a major milestone with our technology by
demonstrating eteplirsen's ability to produce the essential
protein, dystrophin, in DMD patients at levels that we believe
should translate to clinically meaningful benefits," said Chris
Garabedian, President and CEO of AVI. "This drug effect is further
underscored by the strong safety profile we observed with
eteplirsen at the highest doses and longest duration of treatment
that have ever been conducted with our unique RNA-based drug
chemistry."
Financial Results
For the first quarter of 2012, AVI reported an operating loss of
$6.9 million, compared with an operating loss of $5.5 million in
the first quarter of 2011. The increase in the operating loss is
primarily due to a decrease of $3.1 million in government research
contract revenues, partially offset by a $1.7 million decrease in
general and administrative costs.
Revenue for the first quarter of 2012 decreased to $11.2 million
from $14.3 million in the first quarter of 2011, a change of $3.1
million. The lower revenue was attributable to a $2.4 million
decrease in revenue on the H1N1 contract due to its completion in
June 2011 and a $0.7 million decrease in revenue on the ongoing
Ebola and Marburg U.S. government contract due to the variability
of subcontracting activities.
Research and development expenses were $14.8 million for both
the first quarter of 2012 and the first quarter of 2011. During the
current quarter as compared to the first quarter of the prior year,
spending on DMD increased by $1.8 million primarily due to the
Phase IIb trials for eteplirsen and a $0.4 million increase in
spending on other proprietary research. These increases were offset
by a $1.2 million reduction in spending on the H1N1 U.S. government
contract which was completed in June 2011, a $0.6 million reduction
in spending on the ongoing Ebola and Marburg U.S. government
contract and a $0.4 million reduction in personnel related
costs.
General and administrative expenses were $3.3 million in the
first quarter of 2012 compared to $5.0 million in the first quarter
of the prior year. The $1.7 million decrease is primarily due to a
$1.1 million decrease in personnel costs related to the December
2011 reorganization and an executive severance package recorded in
the first quarter of 2011. Legal and professional services also
decreased $0.5 million compared to the first quarter of the prior
year.
Net loss for the first quarter of 2012 was $17.7 million, or
$0.13 per share, compared to net income for the first quarter of
2011 of $1.8 million, or $0.02 per share. The $19.5 million change
in net loss was primarily due to $18.2 million in other expense
associated with the change in the valuation of the Company's
outstanding warrants as described below, and a $1.3 million
increase in operating losses.
In connection with equity financings in 2007 and 2009, the
Company issued warrants that are classified as liabilities and are
adjusted to fair value on a quarterly basis through other income
(loss). The amount of the warrant liability is primarily affected
by changes in AVI's stock price during each financial reporting
period which causes the warrant liability to fluctuate as the
market price of AVI's stock fluctuates. In the first quarter of
2012, the warrant valuation increased by $10.9 million compared to
a decrease in the warrant valuation of $7.3 million in the first
quarter of 2011.
AVI had cash and cash equivalents of $30.6 million as of March
31, 2012, a decrease of $9.3 million from December 31, 2011. This
decrease was due primarily to cash used in operations during the
first quarter of 2012.
Recent Corporate Developments
Duchenne Muscular Dystrophy (DMD) Program
-- Announced that treatment with eteplirsen met the primary
efficacy endpoint in a randomized, double-blind, placebo-controlled
Phase IIb study in boys with DMD. Eteplirsen administered once
weekly at 30mg/kg over 24 weeks resulted in a statistically
significant (p ≤ 0.002) increase in novel dystrophin (22.5%
dystrophin-positive fibers as a percentage of normal) compared to
no increase in the placebo group.
-- Presented efficacy and safety data from the Phase IIb study
examining 24 weeks of treatment with eteplirsen in boys with DMD at
the 2012 American Academy of Neurology Meeting.
Infectious Disease Programs
-- Presented single ascending dose data on AVI-6002 and
AVI-6003, AVI's lead therapeutic candidates for the treatment of
Ebola and Marburg, respectively, and efficacy data on AVI-7100,
AVI's lead therapeutic drug for the treatment of influenza, at the
22nd Annual European Congress of Clinical Microbiology and
Infectious Diseases (ECCMID). In February 2012, AVI announced that
it received approval from the FDA to proceed with a single oligomer
from AVI-6003, AVI-7288, as the lead product candidate against
Marburg virus infection.
Conference Call
AVI BioPharma will hold a financial results and corporate update
conference call today at 5:00 p.m., Eastern Time (2:00 p.m.,
Pacific Time). The conference call may be accessed by dialing
800.659.2032 for domestic callers and 617.614.2712 for
international callers. The passcode for the call is 33411604.
Please specify to the operator that you would like to join the "AVI
BioPharma first quarter 2012 earnings call." The conference call
will be webcast live under the events section of AVI's website at
www.avibio.com, and will be archived there following the call for
90 days. Please connect to AVI's website several minutes prior to
the start of the broadcast to ensure adequate time for any software
download that may be necessary. An audio replay will be available
through May 17, 2012 by calling 888.286.8010 or 617.801.6888 and
entering access code 75539841.
About AVI BioPharma
AVI BioPharma is focused on the discovery and development of
novel RNA-based therapeutics for rare and infectious diseases, as
well as other select disease targets. Applying pioneering
technologies developed and optimized by AVI, the Company is able to
target a broad range of diseases and disorders through distinct
RNA-based mechanisms of action. Unlike other RNA-based approaches,
AVI's technologies can be used to directly target both messenger
RNA (mRNA) and precursor messenger RNA (pre-mRNA) to either
down-regulate (inhibit) or up-regulate (promote) the expression of
targeted genes or proteins. By leveraging its highly differentiated
RNA-based technology platform, AVI has built a pipeline of
potentially transformative therapeutic agents, including
eteplirsen, which is in clinical development for the treatment of
Duchenne muscular dystrophy, and multiple drug candidates that are
in clinical development for the treatment of infectious diseases.
For more information, visit www.avibio.com.
Forward-Looking Statements and
Information
In order to provide AVI's investors with an understanding of its
current results and future prospects, this press release contains
statements that are forward-looking. Any statements contained in
this press release that are not statements of historical fact may
be deemed to be forward-looking statements. Words such as
"believes," "anticipates," "plans," "expects," "will," "intends,"
"potential," "possible" and similar expressions are intended to
identify forward-looking statements. These forward-looking
statements include statements about the development of AVI's
product candidates, the expected timing of results from the
extension study of eteplirsen, the potential for the creation of
novel dystrophin to lead to clinically meaningful benefits over a
longer course of treatment with eteplirsen and AVI's estimates
regarding its future revenue and expenses and expectations
regarding future success, revenue and funding from government and
other sources.
These forward-looking statements involve risks and
uncertainties, many of which are beyond AVI's control. Known risk
factors include, among others: clinical trials may not demonstrate
safety and efficacy of any of AVI's drug candidates and/or AVI's
antisense-based technology platform; development of any of AVI's
drug candidates may not result in funding from the U.S. government
in the anticipated amounts or on a timely basis, if at all; and any
of AVI's drug candidates may fail in development, may not receive
required regulatory approvals, or be delayed to a point where they
do not become commercially viable.
Any of the foregoing risks could materially and adversely affect
AVI's business, results of operations and the trading price of
AVI's common stock. For a detailed description of risks and
uncertainties AVI faces, you are encouraged to review the official
corporate documents filed with the Securities and Exchange
Commission. AVI does not undertake any obligation to publicly
update its forward-looking statements based on events or
circumstances after the date hereof.
AVI BIOPHARMA, INC.
(A Development-Stage Company)
(in thousands, except per share amounts)
(unaudited)
Three Months Ended
March 31,
------------------------------
2012 2011
-------------- --------------
Revenues, from grants and research contracts $ 11,212 $ 14,296
Operating expenses:
Research and development 14,805 14,801
General and administrative 3,281 5,026
-------------- --------------
Operating loss (6,874) (5,531)
Other income (loss):
Interest income and other, net 96 90
Gain (loss) on change in warrant valuation (10,926) 7,274
-------------- --------------
Net income (loss) $ (17,704) $ 1,833
============== ==============
Net income (loss) per share-- basic $ (0.13) $ 0.02
============== ==============
Net income (loss) per share-- diluted $ (0.13) $ 0.02
============== ==============
Shares used in per share calculations--
basic 135,743 112,482
============== ==============
Shares used in per share calculations--
diluted 135,743 121,285
============== ==============
BALANCE SHEET HIGHLIGHTS
(in thousands)
March 31, December 31,
2012 2011
------------- -------------
Cash and cash equivalents $ 30,573 $ 39,904
Total current assets 37,632 45,184
Total assets 46,647 54,368
Total current liabilities 29,923 20,601
Total shareholders' equity 14,022 31,017
AVI Investor and Media Contact: Erin Cox 425.354.5140 Email
Contact
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