ABLYNX REGULATED INFORMATION
ABLYNX ANNOUNCES HALF-YEAR RESULTS FOR 2015 Caplacizumab on track to enter Phase III in acquired TTP, with Ablynx committed to lead commercialisation in Europe and the USA
4 Phase II clinical programmes progressing in RSV, RA and SLE
Significant expansion of immuno-oncology deal with Merck & Co., Inc. now up to 17 programmes
New partnerships established with Genzyme and Taisho
Revenue and grant income up 73% to €38.4 million
Successful issue of €100 million convertible bond, with €268.4 million in cash at 30 June 2015
Webcast presentation scheduled today at 4 pm CET (10 am EST); accessible by clicking hereor on the Ablynx website at http://www.ablynx.com/news/events-presentations/
To participate in the Q&A, dial +32(0)2 402 30 92 with confirmation code 6867520
GHENT, Belgium, 27 August 2015 - Ablynx [Euronext Brussels: ABLX; OTC: ABYLY] today announced its business update and results for the six-month period ending 30 June 2015, which have been prepared in accordance with the IAS 34 "Interim Financial Reporting" as adopted by the European Union. Dr Edwin Moses, CEO of Ablynx commented:
"We have made substantial progress on all fronts, in our own fully-owned programmes and in our partnerships with leading pharmaceutical companies. In our later stage clinical pipeline we are now running four Phase II studies and will be shortly commencing the Phase III study with our wholly-owned anti-vWF Nanobody®, caplacizumab, as a potential first-in-class treatment for the orphan blood disease acquired TTP. We intend to apply for conditional approval of this product in Europe at the beginning of 2017 and, following a review of the commercialisation options, we have concluded that this product represents a strategic opportunity in our evolution into a commercial stage company and the value is best maximised by Ablynx retaining 100% ownership of the product in the USA and Europe."
"We significantly expanded our presence in immuno-oncology with an extension of our collaboration with Merck & Co., Inc. in a deal which now includes up to 17 programmes and could generate up to €5.7 billion in milestones plus royalties. We anticipate increasing our staff by about 10% to 350 during 2015 to resource this important partnership and the other opportunities we are pursuing."
"Thanks to an oversubscribed convertible bond issue of €100 million, we have substantially expanded our stakeholder base and are now well funded to execute on our potential as we look forward to multiple key inflection points, including the release of data from our Phase IIa study with ALX-0171 in infants with RSV planned for H1 2016, the results from the Phase IIb studies with ALX-0061 in RA planned for H2 2016, and the potential launch of caplacizumab in 2018."
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REGULATED INFORMATION
Corporate update - 1 January 2015 to date Wholly-owned clinical product pipeline is advancing Caplacizumab, anti-vWF Nanobody for the treatment of acquired TTP:
Process validation and stability testing are currently on-going to support filing for conditional approval of caplacizumab in Europe in 2017. The first clinical sites for the Phase III study are expected to be opened shortly with the goal to complete this trial by the end of 2017, followed by BLA submission in the United States in 2018. Ablynx intends to retain 100% ownership of caplacizumab in the USA and Europe.
ALX-0171, anti-RSV Nanobody for the treatment of RSV infection in infants:
A Phase IIa study in infants is planned to deliver results in H1 2016. The study started in Europe and is now proceeding in multiple clinical sites in the Asia-Pacific region where the RSV season is currently on- going and the trial is expected to be completed in Europe when the RSV season starts later in the year. The endpoint of the study is primarily safety with secondary endpoints focused on clinical effect (such as wheezing, feeding, respiratory rate and general appearance), PK and PD, and immunogenicity.
More than 20 pre-clinical and clinical partnered programmes are progressing with the most advanced being in multiple Phase II clinical studies: ALX-0061, anti-IL-6R Nanobody, partnered with AbbVie:
Two Phase IIb studies in patients with active RA (total target enrolment: 558 patients) are on-going with results anticipated in H2 2016. Upon achievement of pre-defined success criteria, AbbVie would exercise its option to license ALX-0061 in RA and pay Ablynx an option fee as well as development, regulatory and commercial milestones totalling up to US$665 million plus double digit tiered royalties on net sales. In addition, the first patients from the Phase IIb RA studies have now rolled-over into the open-label extension study with ALX-0061, which will run until H2 2018. A Phase II study with ALX-0061 also commenced in patients with moderate to severe, active SLE, for which results are anticipated in 2018.
ALX-0761, anti-IL-17A/F Nanobody, partnered with Merck Serono:
A Phase Ib study with this bi-specific Nanobody is currently on-going and is planned to be completed before the end of 2015. Merck Serono has an exclusive license to this programme and is responsible for the development and all related costs. Ablynx will receive milestones and royalties as the programme progresses.
More than 20 pre-clinical stage programmes are on-going with Boehringer Ingelheim, Eddingpharm, Genzyme, Merck & Co., Inc., Merck Serono and Novartis, across a wide range of disease indications including immuno-oncology, oncology, inflammation, neurology and bone related disorders. The first Phase I trial arising from the Strategic Alliance with Boehringer Ingelheim is planned for later in 2015.
New partnerships and expansion of existing partnerships: Ablynx and Merck & Co., Inc. (known as MSD outside the US and Canada) have further strengthened their relationship by:
1) A significant expansion of the immuno-oncology agreement (originally signed in 2014) targeting immune-checkpoint inhibitors, to include up to 12 additional Nanobody programmes (total now up to 17). The expansion agreement includes a €13.0 million upfront payment as well as full reimbursement of all related FTE costs over the term of the four year collaboration. In addition, Ablynx is eligible to receive further exclusivity fees and potential development, regulatory and commercial milestone payments of up to €340 million per programme, plus tiered royalties on annual net sales.
2) An 18 month extension through to September 2016 of the research collaboration signed in 2012, targeting an ion channel which could be important in neurology.
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REGULATED INFORMATION
Ablynx entered into an exclusive license agreement with Taisho Pharmaceutical Co., Ltd. for the development and commercialisation of its anti-TNFα Nanobody, ozoralizumab, in Japan, for the treatment of RA. Taisho will be responsible for development, registration and commercialisation of anti- TNFα Nanobody therapeutics in Japan. Ablynx received an upfront payment of US$3 million and is entitled to receive development and commercial milestone payments plus royalties.
Ablynx entered into an exclusive research collaboration with Genzyme (a Sanofi company) to investigate Nanobodies against a target that may play an important role in multiple sclerosis (MS). Ablynx has already generated Nanobodies against this challenging target and Genzyme will have the right to evaluate these Nanobodies in MS-relevant models in return for an exclusivity fee. Upon completion of these studies, Genzyme will have the option to negotiate a license agreement with Ablynx.
Other disclosures: On 20 May, Ablynx successfully placed €100 million of senior unsecured convertible bonds, due May
2020, with a 3.25% coupon rate and a conversion price of €12.93, representing a 26.5% premium above the reference price of €10.2219, being the VWAP ("Volume Weighted Average Price") of Ablynx's Ordinary Shares on the Brussels Stock Exchange (Euronext Brussels) on 20 May 2015.
Ablynx further strengthened its Board of Directors with the appointment of Professor Dr Baroness
Lutgart Van den Berghe as an Independent Director.
Kim Simonsen, Chief Operations Officer, has left the company.
Financial review - 1 January to 30 June 2015 Key figures (in € million)H1 2015 | H1 2014 | Variance | |
Total revenue and grant income | 38.4 | 22.2 | 73% |
R&D income | 38.0 | 21.8 | 74% |
Grants | 0.4 | 0.4 | 0% |
Operating expenses | (45.9) | (29.8) | 54% |
R&D | (40.3) | (24.5) | 64% |
G&A | (5.6) | (5.3) | 6% |
Operating result | (7.4) | (7.6) | 3% |
Net financial result | (7.7) | 1.3 | (692%) |
Net result | (15.2) | (6.3) | 141% |
Net cash burn | (35.0) (1) | (4.4) | (695%) |
Cash at 30 June* | 268.4 (2) | 196.0 (3) | 37% |
(1) Excluding net proceeds of €97.2M from the convertible bonds, which raised €100 million, announced on 20 May 2015
(2) Including €1.6 million in restricted cash and net proceeds from the convertible bonds
(3) Including €2.0 million in restricted cash
* Defined as liquidity position in the cash flow statement
Income statement
During the first six months of 2015, total revenue and grant income increased by 73% to €38.4 million (2014: €22.2 million), mainly driven by FTE funding and recognised income from the upfront payments received from AbbVie, Merck & Co., Inc. and Merck Serono.
Research and development expenses increased by 64% to €40.3 million (2014: €24.5 million). This increase was mainly attributable to higher external development costs which are largely related to clinical trials
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REGULATED INFORMATION
expenditure. General and administrative expenses were broadly in line with 2014 and amounted to €5.6 million (2014: €5.3 million).
As a result of the above, the operating loss was €7.4 million in the first half of 2015 (2014: €7.6 million).
The net financial result (-€7.7 million) comprises finance income of €1.1 million which relates to interest income and realised exchange gains, and finance costs of €8.8 million which mainly relate to the effect of the fair value calculation of the convertible bond.
As a result of the above, the net loss increased to €15.2 million during the first six months ending 30 June
2015 (2014: €6.3 million).
The Company's intangible assets include a portfolio of acquired patents which are fully amortised and technology licenses that are being amortised over 5, 18 and 20 years. The Company expenses all its research and development activities in the IFRS consolidated financial statements. The intangible assets also include software licenses.
The Company's non-current tangible assets include the Company's laboratory and office equipment, the investments in its facilities, tax receivables and €1.6 million restricted cash, which is a cash pledge that the Company has provided for the lease of its building. The Company owns one llama facility (which it previously rented) and continues to invest in equipment for its research activities. Tax receivables include an R&D tax credit receivable of €13.5 million.
The Company's current assets of €274.6 million consist mainly of trade receivables, short-term financial investments, and cash and cash equivalents.
The Company's equity decreased from €75.5 million at the end of 2014 to €63.8 million at 30 June 2015, mainly as a result of the incorporation of the loss for the period.
Non-current liabilities relate to the senior unsecured bonds due on 27 May 2020 with a principal value of
€100 million.
Current liabilities consist mainly of trade payables and deferred income related to the upfront payments received from the partners.
Cash flow from operating activities represented a net outflow of €36.5 million as compared to a net outflow of €3.9 million during the first six months ending 30 June 2014. The difference primarily relates to a higher loss for the current period and the impact in 2014 of the cash upfront received from Merck & Co., Inc. in February 2014.
Cash flow from investing activities represented a net outflow of €35.0 million as compared to a net inflow of €4.9 million during the first six months ending 30 June 2014. The net cash outflow comprises primarily the net movements in cash and cash equivalents (on deposits with a term of less than 1 month) and other short-term financial investments (on deposits with a term greater than 1 month).
Cash flow from financing activities represented a net inflow of €100.0 million compared to a net inflow of
€0.1 million during the first six months of 2014. The difference primarily relates to the net proceeds from the issuance of convertible bonds and the exercise of warrants.
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REGULATED INFORMATION
The Company ended the period with a total liquidity position of €268.4 million (2014: €196.0 million) which consists of cash and cash equivalents of €40.0 million, other short-term financial investments of €226.8 million and restricted cash of €1.6 million.
Outlook for the remainder of 2015
Ablynx is on track to start a Phase III study with its wholly-owned anti-vWF Nanobody, caplacizumab, during Q3 2015. In parallel, process validation activities will continue to support filing for conditional approval of caplacizumab in Europe in early 2017.
The Phase IIa study with its wholly-owned anti-RSV Nanobody, ALX-0171, will continue in clinical sites in the Asia-Pacific region and Europe with the goal to complete recruitment by the end of 2015 and to deliver results in H1 2016.
Ablynx anticipates receiving further milestone payments from on-going collaborations and continues to expect its net cash burn for 2015 to be in the €70-80 million range (excluding net proceeds from the convertible bond).
The Ablynx management team will host a conference call and webcast during which the H1 2015 results will be presented, followed by a Q&A session. This event will be held today, 27 August 2015 at 4 pm CET/10 am EST. The conference call will be webcast live and may be accessed under the News & Eventssection of the Ablynx website or by clicking here. If you would like to participate in the Q&A, please dial +32 (0)2 402 30
92 with confirmation code 6867520. Shortly after the call, a replay of the webcast and the presentation used in connection with the conference call webcast will be available on the Company's website under section News & Events.
18 November 2015 - results Q3 2015
25 February 2016 - full year results 2015
28 April 2016 - annual general meeting 2016
12 May 2016 - results Q1 2016
25 August 2016 - half year results 2016
23 November 2016 - results Q3 2016
The next shareholders' clubs at Ablynx will take place on 16 September and 9 December 2015 at 5.45pm
CET. If you would like to attend, please contact us via investors@ablynx.com.
BLA biologics license application
FTE full time equivalent
IL-6R interleukin-6 receptor
IL-17 interleukin-17
PK pharmaco kinetics PD pharmaco dynamics RA rheumatoid arthritis
RSV respiratory syncytial virus
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REGULATED INFORMATION
SLE systemic lupus erythematosus
TNF tumour necrosis factor
TTP thrombotic thrombocytopenic purpura
vWF von Willebrand factor
Ablynxis a biopharmaceutical company engaged in the development of Nanobodies®, proprietary therapeutic proteins based on single-domain antibody fragments, which combine the advantages of conventional antibody drugs with some of the features of small-molecule drugs. Ablynx is dedicated to creating new medicines which will make a real difference to society. Today, the Company has more than 30proprietary and partnered programmesin development in various therapeutic areas including inflammation, haematology, immuno-oncology, oncology and respiratory disease. The Company has collaborations with multiple pharmaceutical companies including AbbVie, Boehringer Ingelheim, Eddingpharm, Genzyme, Merck & Co., Inc., Merck Serono, Novartis and Taisho Pharmaceutical Co., Ltd. The Company is headquartered in Ghent, Belgium. More information can be found on www.ablynx.com.
For more information, please contact: Ablynx:
Dr Edwin Moses
CEO
t: +32 (0)9 262 00 07 m: +32 (0)473 39 50 68
e: edwin.moses@ablynx.com
Marieke Vermeersch
Associate Director Investor Relations t: +32 (0)9 262 00 82
m: +32 (0)479 49 06 03
e: marieke.vermeersch@ablynx.com
@AblynxABLX
Sue Charles, Daniel Gooch
London office
t: +44 (0)20 7866 7905
e: ablynx@instinctif.com
Jim Rusagara
Brussels office
t: +32 (0)2 626 9500
e: ablynx@instinctif.com
Certain statements, beliefs and opinions in this press release are forward-looking, which reflect the Company or, as appropriate, the Company directors' current expectations and projections about future events. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from t hose expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. A multitude of factors including, but not limited to, changes in demand, competition and technology, can cause actual events, performance or results to differ significantly from any anticipated development. Forward looking statements contained in this press release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. As a result, the Company expressly disclaims any obligation or undertaking to release any update or revisions to any forward-looking statements in this press release as a result of any change in expectations or any change in events, conditions, assumptions or circumstances on which these forward-looking statements are based. Neither the Company nor its advisers or representatives nor any of its parent or subsidiary undertakings or any such person's officers or employees guarantees that the assumptions underlying such forward-looking statements are free from errors nor does either accept any responsibility for the future accuracy of the forward-looking statements contained in this press release or the actual occurrence of the forecasted developments. You should not place undue reliance on forward- looking statements, which speak only as of the date of this press release.
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REGULATED INFORMATION
FINANCIAL INFORMATION
The condensed consolidated financial statements for the six month's period ended 30 June 2015 have been prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by the European Union. They do not include all the information required for the full annual financial statements and should therefore be read in conjunction with the financial statements for the year ended 31 December 2014. The financial statements are presented in thousands of Euros (unless stated otherwise). The condensed consolidated financial statements have been approved for issue by the Board of Directors on 26 August 2015.
The statutory auditor, Deloitte Bedrijfsrevisoren/Reviseurs d'Entreprises, represented by Gert Vanhees, confirms that the limited review, which has been substantially completed, did not reveal any significant adjustments to the consolidated half-year financial information included in this press release.
The interim financial report 2015 is available on the Ablynx website:
http://www.ablynx.com/investors/financial-information/
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REGULATED INFORMATION
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Period ended 30 June (€ '000) 2015 2014
Revenue:
Research and development 38,012 21,830
Grants 406 406
Research and development expenses (40,271) (24,522) General and administrative expenses (5,583) (5,297) Total operating expenses (45,854) (29,819) Other operating income 7
Other operating expenses (5)
Finance income 1,101 2,156
Finance cost convertible bond: (40) (887) Interest bond (303)
Changes fair value derivative (7,630) Interest amortisation (325) Financing charges (549)
Loss attributable to equity holders (15,187) (6,307) Total comprehensive loss attributable to equity holders (15,187) (6,307)
Basic and diluted loss per share (0.28) (0.13)
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CONDENSED CONSOLIDATED BALANCE SHEET As at 30 June As at 31 December (€'000) 2015 2014 Non-current assets 18,479 16,550
Intangible fixed assets 402 439
Property, plant and equipment 2,793 2,301
Restricted cash 1,645 1,980
Tax receivables 13,535 11,830
Trade receivables 4,839 19
Other current assets 665 571
Tax receivables 435 454
Accrued income and deferred charges 1,889 1,549
Other short-term financial investments 226,783 192,542
Cash and cash equivalents 39,965 11,661
Share capital 94,124 91,975
Share premium account 185,635 183,645
Share-based payment reserve 7,030 7,615
Retained earnings (222,944) (207,761)
Borrowings host debt 78,559
Borrowings embedded derivative 27,130
Borrowings 141
Trade payables 18,401 10,408
Other current liabilities 4,145 4,826
Deferred income 100,871 132,497
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REGULATED INFORMATION
CONDENSED CONSOLIDATED CASH FLOW STATEMENT Period ended 30 June (€'000) 2015 2014 Cash flows from operating activities
Loss before income tax (15,187) (6,307) Adjustments for:
Amortisation 102 86
Depreciation 543 689
Share-based payment expense 832 833
Net financial income (1,061) (1,269) Net loss arising on convertible bond designated as at fair value through P&L 7,630
Finance expense recognised in respect of the convertible bond 874
Net movement in trade and other receivables (6,940) 3,540
Net movement in trade and other payables (24,314) (2,700) Cash (used in)/provided by operations (37,521) (5,128) Interest paid (40) (887) Interest received 1,101 2,156
Purchases of property, plant and equipment (1,041) (466) Purchases of intangible assets (58) (129) Sale / (Purchase) of short-term financial investments (33,906) 5,464
Proceeds from exercise of warrants 2,725 479
Proceed from issue of convertible bond (net of issue costs) 97,185
Repayments of borrowings (141) (420)
Cash and cash equivalents at beginning of the period 11,661 10,531
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REGULATED INFORMATION
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDER EQUITY (€'000) Share capital Share premium Share- based payments Retained loss Total EquityBalance at 31 December 2013 84,004 150,747 6,736 (195,314) 46,173
Loss of the period (6,307)
Other comprehensive income Available-for-sale financial assets Total comprehensive income Warrant plans
Share-based payments 550 283
Transactions with owners
Capital increase
Issuance costs
Exercise of warrants 482 311 (313)
Balance at 30 June 2014 84,486 151,058 6,973 (201,338) 41,179
Balance at 31 December 2014 91,975 183,645 7,615 (207,761) 75,474
Loss of the period (15,187)
Other comprehensive income Available-for-sale financial assets Total comprehensive income Warrant plans
Share-based payments 828 4
Transactions with owners
Capital increase
Issuance costs
Exercise of warrants 2,149 1,990 (1,413)
Balance at 30 June 2015 94,124 185,635 7,030 (222,944) 63,845
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