Medgenics, Inc. ('Medgenics' or the 'Company') Half-Yearly Report the Six-Month Period Ended 30 June 2008
September 24 2008 - 3:36AM
Business Wire
Medgenics (AIM:MEDG) announces its half-yearly report for the
six-month period ended 30 June 2008. Highlights for the period
Appointment of Lord Steinberg as Non-Executive Director in February
2008. Appointment of Dr. Ehud Shoshani, former CEO of Quintiles,
Israel, as Vice President of Clinical Affairs and addition of key
scientific and engineering personnel in accordance with its plan
and preparation for the Phase I/II clinical trial for EPODURE
sustained-action protein therapy to treat anaemia. Successful
manufacture of the key 'gutless' adenoviral vector in a GMP (Good
Manufacturing Practice) vector production facility. This vector
will be used to prepare EPODURE Biopumps capable of producing
sufficient daily amounts of erythropoietin (EPO) to meet the
Company's requirements for use in its Phase I/II clinical trials in
anaemic patients with chronic kidney disease. Completion of the
design, fabrication and evaluation of the key proprietary patient
contact devices that will be used both to enable Medgenics to
conduct its current Phase I/II clinical trial and to assist in
future clinical trials. Successful move to a new larger facility,
allowing the corporate and R&D operations to be housed in one
location. Significant Post-period Highlights Commencement of Phase
I/II safety and efficacy clinical trial with EPODURE following
receipt of approval from Israel�s Ministry of Health. Financial
Summary (in US $; unaudited) Net loss after tax of $2.97 million
for the period (2007: $1.04 million) as a result primarily of
preparations for and initiation of the Phase I/II clinical trial of
EPODURE, including the set up costs associated with the new
laboratories and the recruitment of additional R&D staff.
R&D costs for the six-month period of $1.63 million (2007:
$0.44 million) and general and administrative costs of $1.39
million (2007: $0.64 million). Cash, cash equivalents and
short-term investments at 30 June 2008 of $1.74 million (at 31
December 2007: $4.68 million). Dr. Andrew Pearlman, Chief Executive
Officer of Medgenics, said: �2008 continues to be an exciting year
for Medgenics and we have been focused on preparing for the start
of our landmark Phase I/II safety and efficacy trial of our EPODURE
Biopump for providing sustained treatment of anaemia in patients
with chronic kidney disease. We were pleased to receive approval to
start this trial at the end of July, and have been fully engaged in
the process of recruiting patients since early August. We have now
begun the final screening process of the first patients for this
trial who were referred from several cooperating nephrology centers
in Israel and we continue on track towards publishing our initial
data and findings before the end of the year.� NOTES TO EDITORS:
Medgenics, Inc. is a clinical-stage biopharmaceutical company
developing its unique tissue-based Biopump platform technology to
provide sustained-action protein therapy for the treatment of a
range of chronic diseases. Medgenics currently has two products in
development based on this technology: EPODURE � producing
erythropoietin (EPO) to treat anaemia INFRADURE � producing
interferon-alpha (IFN-?) to treat hepatitis C The Company has
demonstrated proof of principle of the Biopump treatment procedure
in a clinical trial using a short-acting version of EPODURE in
anaemic patients. A long-acting version of EPODURE, designed to
produce and deliver a therapeutic dose of EPO steadily for six
months or more, entered a Phase I/II trial in mid-2008. The Company
plans to follow with a clinical trial of INFRADURE in 2009.
Medgenics intends to develop its innovative products and bring them
to market via multiple strategic partnerships with major
pharmaceutical and/or medical device companies, starting with
EPODURE and INFRADURE. Beyond these, Medgenics plans to develop
and/or out-license a pipeline of future Biopump products targeting
the large and rapidly growing global protein therapy market, which
is forecast to reach US $87 billion by 2010. Other potential areas
include multiple sclerosis (interferon-?), haemophilia (Factor
XIII), paediatric growth hormone deficiency (human growth hormone)
and diabetes (insulin). Founded in 2000, Medgenics is a
US-incorporated company with major operations in Misgav, Israel.
Medgenics was admitted to AIM in December 2007 (AIM:MEDG).
www.medgenics.com CAUTIONARY NOTICE REGARDING FORWARD-LOOKING
STATEMENTS This release contains forward-looking statements, which
include all statements other than statements of historical fact,
including (without limitation) those regarding the Company�s
financial position, business strategy, plans and objectives of
management for future operations. These statements relate to future
events, prospects, developments and strategies. Forward-looking
statements are sometimes identified by their use of the terms and
phrases such as �estimate,� �project,� �intend,� �forecast,�
�anticipate,� �plan,� �planning," �expect,� �believe,� �will,�
�will likely,� �should,� �could,� �would,� �may� or the negative of
such terms and other comparable terminology. All such
forward-looking statements are based on current expectations and
are subject to risks and uncertainties. Should any of these risks
or uncertainties materialize, or should any of the Company�s
assumptions prove incorrect, actual results may differ materially
from those included within these forward-looking statements.
Accordingly, no undue reliance should be placed on these
forward-looking statements, which speak only as of the date made.
The Company expressly disclaims any obligation or undertaking to
disseminate any updates or revisions to any forward-looking
statements contained herein to reflect any change in the Company�s
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statements are based.
As a result of these factors, the events described in the
forward-looking statements contained in this release may not occur.
Chairman�s Review Medgenics has made important progress during
2008, preparing for and successfully launching its landmark Phase
I/II safety and efficacy trial of EPODURE, its lead protein therapy
to treat anemia. We were pleased to receive approval from Israel�s
Ministry of Health in late July and have begun the trial at the
Hadassah University Medical Center in Jerusalem, Israel, where it
is being led by Principal Investigator, Dr. Eithan Galun, a veteran
of numerous clinical trials. Patient recruitment is ongoing and we
remain on track to announce initial data from the trial by the end
of the year. This study will involve up to 30 patients with anaemia
as a consequence of chronic kidney disease. The primary aim is to
assess the safety and efficacy of EPODURE in three controlled dose
ranges, in providing sustained, elevated levels of the deficient
protein erythropoietin (EPO) and, thereby, in elevating the red
blood cell count and haemoglobin levels for up to 4�6 months in
those patients receiving appropriate doses. The first patients are
scheduled to receive the lowest dose range of up to 20 Units of EPO
per kilogram per day. Once an interim review has confirmed initial
safety in at least six patients, higher doses of 40 and 60 Units
are planned. EPODURE is based on Medgenics� revolutionary
proprietary platform technology for treating certain chronic
diseases, whereby a biological �Biopump� is created from patients�
own tissue, enabling them to produce their own natural human
protein therapy for what we hope will be up to six months or more
from a single procedure. We believe this technology has the
potential to improve significantly the treatment of such diseases
by improving efficacy, reducing side-effects, eliminating frequent
injections, improving patient compliance and quality of life and
reducing overall healthcare costs associated with existing
treatments. We have been able to advance our clinical development
activities for EPODURE as a result of the �3.28 million ($6.72
million) fundraising we concluded successfully in December 2007 in
conjunction with the Company�s admission to AIM. During the first
half of 2008, the Company has incurred a large number of one-off
costs including the set-up of new facilities and the design and
manufacture of several key elements that were necessary to enable
us to commence the Phase I/II clinical trial. We are therefore
confident that the funds raised at Admission, together with ongoing
Israeli government funding from the Office of the Chief Scientist,
as well as the existing letter of credit, are sufficient to enable
the Company to continue its current programme of ongoing
development and testing of our Biopump platform technology and
associated products, focusing on EPODURE with the first set of data
expected towards the end of 2008. Our strategy for
commercialization is to develop alliances with major partners and
to proceed with further clinical trials leading to eventual FDA,
EMEA and/or other regulatory approvals and eventual clinical
adoption of EPODURE. Furthermore, in the longer-term, we also plan
to pursue similar steps towards commercialization of other
potential applications of the Biopump platform technology. Pending
the success of the Phase I/II trial of EPODURE, our next product is
likely to be INFRADURE, which we are developing to produce and
deliver interferon-alpha for the treatment of hepatitis C. In
preclinical in vitro studies with this product we have already
demonstrated that it can produce therapeutically relevant amounts
for more than six months. Beyond that, we believe our Biopump
technology has the potential to be developed to produce and deliver
protein therapies to treat other chronic diseases such as multiple
sclerosis (interferon-beta), hemophilia (Factor VIII) and growth
failure/muscular atrophy (human growth hormone). Key events during
the period The start of the EPODURE Phase I/II trial and initiation
of patient recruitment parallels the Company's achievement of
several important milestones in recent months, which have been
crucial to facilitating the commencement of the trial: We have
significantly enhanced the clinical and technical teams that will
be driving the trial forward. In particular, we are pleased that
Dr. Ehud Shoshani, former CEO of Quintiles, Israel, has joined the
Company as Vice President of Clinical Affairs. Dr. Shoshani has 13
years� experience in managing clinical trials. Not only will his
experience be highly valuable to Medgenics in completing the
preparations for and the launch and the management of our imminent
Phase I/II clinical trial for EPODURE, but also, in the development
of our future clinical programmes for this and our other pipeline
products. We have successfully manufactured the key 'gutless'
adenoviral vector in a GMP vector production facility which was a
significant achievement for the Company from a technological
standpoint. We have tested this vector and are confident that it
can be used to prepare EPODURE Biopumps capable of producing
sufficient daily amounts of EPO to meet the Company's requirements
for use in the trial. The Company has completed the design,
fabrication and evaluation of the key proprietary devices required
for harvesting patient micro-organs and implanting Biopumps,
including EPODURE, back into patients. The Group�s operations were
relocated to a new facility in March 2008 in the Teradion Business
Park in Misgav, thereby bringing all operations under one roof and
representing an important step for enhancing communication among
the various departments. Board Appointment Medgenics appointed Lord
Leonard Steinberg as Non-Executive Director in February 2008. Lord
Steinberg is a Life Peer and a Conservative Party member of the UK
House of Lords and is the founder, former Chairman and Life
President of Genting Stanley plc (formerly Stanley Leisure plc). He
is one of the UK�s most successful and respected businessmen, with
substantial experience of the London stock market. We are pleased
that he joined the Board of Directors and we look forward to the
valuable contribution he will make to the Company. Financial Review
of the six-month period to 30 June 2008 (unaudited) Net research
and development expenses were $1.63 million (2007: $0.44 million)
Group general and administrative expenses were $1.39 million (2007:
$0.64 million) Operating loss was $3.02 million (2007: $1.08
million) Loss on ordinary activities before taxation for the period
was�$2.97 million (2007: $1.04 million) Loss per share was $0.03
(2007: $0.02) Cash, cash equivalents and short-term investments at
the end of the period was $1.74 million (at 31 December 2007: $4.68
million) Consolidated balance sheet has net assets of $0.61 million
(at 31 December 2007: $3.33 million) Outlook The start of our Phase
I/II clinical trial with EPODURE was a major milestone for the
Company and is progressing. Positive results of the trial will be
crucial to confirm both the safety and efficacy of EPODURE in
anaemia patients, and will more broadly provide proof-of-concept of
our innovative Biopump technology for the long-term treatment of
chronic diseases. If the results are as we hope and expect, they
will support our ambitions of raising significant funds to advance
EPODURE into further clinical studies, to enhance our strategic
partnering activities and to progress the development of additional
Biopump-based therapeutic procedures in other disease areas. All
the evidence we have seen on the effectiveness of the Biopump
technology in various preclinical studies and our previous clinical
study give us confidence that the Phase I/II trial will be
successful. We are looking forward to reporting the first
preliminary data over the coming months. Eugene A. Bauer, MD
Chairman of the Board of Directors 24 September 2008
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