Threshold Pharmaceuticals Reports Third Quarter Financial Results
08 November 2016 - 12:00AM
-- Planning to initiate a clinical trial of
evofosfamide in combination with checkpoint inhibitors --
Threshold Pharmaceuticals, Inc. (Nasdaq:THLD), a clinical-stage
biopharmaceutical company developing novel therapies for cancer,
today reported financial results for the third quarter ended
September 30, 2016 and provided an update on the Company's
corporate and clinical development activities.
"We plan to initiate a clinical trial evaluating evofosfamide in
combination with checkpoint inhibitors with our collaborators at MD
Anderson Cancer Center while at the same time continue to pursue
registration of evofosfamide in Japan for the treatment of
pancreatic cancer. In addition, we continue to pursue potential
collaborations to expand our development pipeline while we complete
IND-enabling toxicology studies with TH-3424 with the goal of
reaching the clinic with a new compound in 2017,” said Barry
Selick, Ph.D., Chief Executive Officer of Threshold.
Recent HighlightsEvofosfamide
– The Company’s lead product candidate is an investigational
hypoxia-activated prodrug that is designed to be activated under
tumor hypoxic conditions, a hallmark of many cancers.
- First meeting scheduled with the Japanese PMDA (Pharmaceutical
and Medical Devices Agency) to present the improvement in
overall survival that was observed in the Japanese
sub-population of the MAESTRO Phase 3 trial;
- The Company announced a partnership with Caris Life Sciences to
develop a customized assay for pancreatic cancer patients to
predict likelihood of response to evofosfamide;
- Clinical development collaborations investigating evofosfamide
in patients with pancreatic neuroendocrine tumors (pNET), recurrent
glioblastoma (GBM) and hepatocellular carcinoma (HCC) remain
ongoing;
- A recent presentation by one of the Company’s collaborators
from the MD Anderson Cancer Center highlighted the promise of
evofosfamide in combination with a class of checkpoint inhibitor
antibodies to improve the efficacy of this class of potent
anti-cancer therapies; and
- The Company plans to initiate a clinical trial in various solid
tumors evaluating evofosfamide in combination with one or more
checkpoint inhibitor antibodies in development.
Tarloxotinib – The Company had been prosecuting
Phase 2 proof of concept studies with tarloxotinib, a
hypoxia-activated epidermal growth factor receptor (EGFR) tyrosine
kinase inhibitor (TKI), which was designed to selectively release
an irreversible EGFR-TKI in hypoxic tumors.
- During the quarter, the Company announced interim results from
two proof-of-concept, Phase 2 clinical trials in patients with
advanced non-small cell lung cancer (NSCLC) and patients with
metastatic squamous cell carcinoma of the head and neck and skin.
While results in patients with squamous cell carcinoma of the skin
were minimally sufficient for continuation, the response rate in
the NSCLC trial and the head and neck arms of the squamous cell
cancer trial did not meet the minimum response rate hurdles for
study continuation. Accordingly, enrollment in both Phase 2
clinical trials and further development of tarloxotinib has been
discontinued.
TH-3424 – TH-3424 is the Company’s
small-molecule drug candidate being evaluated for the treatment of
hepatocellular (liver) cancer (HCC), castrate resistant prostate
cancer (CRPC), T-cell acute lymphoblastic leukemias (T-ALL), and
other cancers expressing high levels of aldo-keto reductase family
1 member C3 (AKR1C3). Tumors overexpressing AKR1C3 can be resistant
to radiation therapy, chemotherapy and anti-androgen therapy.
TH-3424 is a prodrug that selectively releases a potent DNA
cross-linking agent in the presence of AKR1C3.
- TH-3424 has been selected as a lead candidate and
Investigational New Drug (IND)-enabling studies have been initiated
in collaboration with Ascenta Pharmaceuticals, Ltd.
Third Quarter 2016 Financial Results
- Cash, cash equivalents and marketable securities totaled $28.1
million at September 30, 2016 compared to $33.6 million at June 30,
2016; the net decrease of $5.5 million was a result of operating
cash requirements for the quarter ended September 30, 2016. With
the previously announced decision to cease joint development of
evofosfamide under the Company’s former collaboration with Merck
KGaA, the decision in September to discontinue further development
of tarloxotinib, and the workforce reduction, the Company continues
to expect its operating cash requirements to be lower for the
fourth quarter of fiscal year 2016 and fiscal year 2017.
- No revenue was recognized in the third quarter ended September
30, 2016 compared to $3.7 million for the same period of 2015.
Revenue for the quarter ended September 30, 2015 related to the
amortization of the aggregate of $110 million in upfront and
milestone payments received from the Company’s former collaboration
with Merck KGaA, Darmstadt, Germany. The revenue from the upfront
payment and milestone payments received under the agreement were
previously being amortized over the relevant performance period,
rather than being immediately recognized when the upfront payment
and milestones were earned or received. As a result of Merck KGaA,
Darmstadt, Germany's and the Company’s decision to cease further
joint development of evofosfamide in December 2015, the Company
immediately recognized all of the remaining deferred revenue into
revenue during the quarter ending December 31, 2015. Also as
a result of the termination of the agreement, the Company is no
longer eligible to receive any further milestone payments from
Merck KGaA, Darmstadt, Germany.
- Research and development expenses were $3.5 million for the
third quarter ended September 30, 2016, compared to $8.1 million
for the same period in 2015. The decrease in research and
development expenses, net of reimbursement for Merck KGaA,
Darmstadt, Germany’s 70 percent share of total eligible
collaboration expenses for evofosfamide, was due primarily to a
$2.8 million decrease in employee related expenses, including a
$0.4 million decrease in non-cash stock-based compensation expense
and a $1.8 million decrease in clinical development expenses and
consulting expenses. The Company expects research and development
expenses to continue to decline in 2016 as a result of the decision
to cease further joint development of evofosfamide under the
Company’s former collaboration with Merck KGaA and the workforce
reduction.
- General and administrative expenses were $1.7 million for the
third quarter ended September 30, 2016 compared to $2.4 million for
the same period in 2015. The decrease in general and administrative
expenses was due primarily to a $0.5 million decrease in employee
related expenses and a $0.2 million decrease in consulting
expenses.
- Non-cash stock-based compensation expense included in total
operating expenses was $0.8 million for the third quarter of 2016
compared to $1.5 million for the same period in 2015. The decrease
in stock-based compensation expense was due to the amortization of
a smaller number of options with lower fair values.
- Net loss for the third quarter of 2016 was $5.7 million
compared to $6.4 million for the same period in 2015. Included in
the net loss for the third quarter of 2016 was an operating loss of
$5.2 million and non-cash expense of $0.5 million compared to an
operating loss of $6.8 million and non-cash income of $0.3 million
for the third quarter of 2015. The non-cash income or expense is
related to changes in the fair value of the Company’s outstanding
and exercised warrants that was classified as other income
(expense).
About EvofosfamideEvofosfamide (previously
known as TH-302) is an investigational hypoxia-activated prodrug of
a bis-alkylating agent that is preferentially activated under
severe hypoxic tumor conditions, a feature of many solid tumors.
Areas of low oxygen levels (hypoxia) in solid tumors are due to
insufficient blood vessel supply. Similarly, the bone marrow of
patients with hematological malignancies has also been shown, in
some cases, to be severely hypoxic.
About Tarloxotinib BromideTarloxotinib bromide
(previously known as TH-4000), or "tarloxotinib", is a prodrug
designed to selectively release a covalent (irreversible) EGFR
tyrosine kinase inhibitor under severe hypoxia, a feature of many
solid tumors. In September 2016, the Company announced the
discontinuation of any further development of tarloxotinib.
About TH-3424 TH-3424 is small-molecule drug
candidate being evaluated for the potential treatment of
hepatocellular (liver) cancer (HCC), castrate resistant prostate
cancer (CRPC), T-cell acute lymphoblastic leukemias (T-ALL), and
other cancers expressing high levels of aldo-keto reductase family
1 member C3 (AKR1C3). Tumors overexpressing AKR1C3 can be resistant
to radiation therapy and chemotherapy. TH-3424 is a prodrug that
selectively releases a potent DNA cross-linking agent in the
presence of AKR1C3. Preliminary nonclinical toxicology studies
suggested an adequate therapeutic index that the Company believes
warrants conducting Investigational New Drug (IND)-enabling
toxicology studies, which are being done in collaboration with
Ascenta Pharmaceuticals, Ltd. About Threshold
Pharmaceuticals Threshold is a clinical-stage
biopharmaceutical company focused on the development of drugs and
diagnostic agents targeting the tumor microenvironment of solid
tumors and hematologic malignancies. This approach offers broad
potential to treat a variety of cancers. By selectively targeting
tumor cells, we are building a pipeline of drugs that hold promise
to be more effective and less toxic to healthy tissues than
conventional anticancer drugs. For additional information, please
visit the Company’s website. Forward-Looking
StatementsExcept for statements of historical fact, the
statements in this press release are forward-looking statements,
including all statements regarding the therapeutic potential of
evofosfamide and TH-3424; Threshold's plans to focus its resources
on evofosfamide and TH-3424; anticipated development activities
related to evofosfamide and TH-3424, and the anticipated timing
thereof; Threshold's plans to continue to pursue discussions
regarding potential registration pathways for evofosfamide in
Japan, and the potential for evofosfamide to be approved for
marketing in Japan; and Threshold's estimates of the total and
non-cash charges it expects to incur in connection with the
reduction in employees, and the anticipated timing thereof. These
statements involve risks and uncertainties that can cause actual
results to differ materially from those in such forward-looking
statements. Potential risks and uncertainties include, but are not
limited to: the difficulty and uncertainty of pharmaceutical
product development, including the risks that the design of, or
data collected from, the planned Phase I clinical trial of
evofosfamide with immune checkpoint inhibitors may be inadequate to
demonstrate safety or sufficient efficacy, or otherwise may be
insufficient to support any further development of evofosfamide,
and that Threshold's toxicology studies of TH-3424 may not
demonstrate sufficient safety to support an investigational new
drug application and to further the development of TH-3424 into the
clinic; the uncertain and time-consuming regulatory approval
process, including the risk that data from the completed MAESTRO
clinical trial will not be sufficient to support the approval of
evofosfamide for the treatment of patients with pancreatic cancer
in Japan; Threshold's need for and the availability of resources to
develop evofosfamide and TH-3424 and to support Threshold's
operations, including the risks that Threshold's
currently-available resources may be insufficient to further
current development plans for evofosfamide and TH-3424 and that
Threshold will otherwise need to raise substantial additional
capital in order to advance the clinical development of
evofosfamide and TH-3424; the risks that Threshold could determine
to abandon the development of evofosfamide and TH-3424 as a result
of inadequate resources, negative or inconclusive clinical trial or
toxicology study results, the failure to obtain regulatory approval
of evofosfamide in Japan, or otherwise; and risks related to
Threshold's ability to implement the reduction in employees as
currently anticipated, the impact of such reduction on Threshold's
business and unanticipated charges not currently contemplated that
may occur as a result of such reduction. Further information
regarding these and other risks is included under the heading "Risk
Factors" in Threshold's Quarterly Report on Form 10-Q, which has
been filed with the Securities and Exchange Commission on November
7, 2016 and is available from the SEC's website (www.sec.gov) and
on our website (www.thresholdpharm.com) under the heading
"Investors". We undertake no duty to update any forward-looking
statement made in this news release.
THRESHOLD PHARMACEUTICALS, INC. |
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
(in thousands, except per share
amounts) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
- |
|
|
$ |
3,680 |
|
|
$ |
- |
|
|
$ |
11,041 |
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
|
|
|
|
|
|
|
Research and
development |
|
3,521 |
|
|
|
8,081 |
|
|
|
13,542 |
|
|
|
28,902 |
|
|
General and
administrative |
|
1,716 |
|
|
|
2,372 |
|
|
|
5,857 |
|
|
|
7,468 |
|
|
Total Operating
Expenses |
|
5,237 |
|
|
|
10,453 |
|
|
|
19,399 |
|
|
|
36,370 |
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
(5,237 |
) |
|
|
(6,773 |
) |
|
|
(19,399 |
) |
|
|
(25,329 |
) |
|
|
|
|
|
|
|
|
|
|
Interest income
(expense), net |
|
39 |
|
|
|
27 |
|
|
|
111 |
|
|
|
99 |
|
|
Other income
(expense) (1) |
|
(498 |
) |
|
|
315 |
|
|
|
(1,124 |
) |
|
|
(661 |
) |
|
Net loss |
$ |
(5,696 |
) |
|
$ |
(6,431 |
) |
|
$ |
(20,412 |
) |
|
$ |
(25,891 |
) |
|
|
|
|
|
|
|
|
|
|
Net loss per
common share |
|
|
|
|
|
|
|
|
Basic |
$ |
(0.08 |
) |
|
$ |
(0.09 |
) |
|
$ |
(0.29 |
) |
|
$ |
(0.37 |
) |
|
Diluted |
$ |
(0.08 |
) |
|
$ |
(0.09 |
) |
|
$ |
(0.29 |
) |
|
$ |
(0.37 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted-average shares used in per common |
|
|
|
|
|
share calculation: |
|
|
|
|
|
|
|
|
Basic |
|
71,536 |
|
|
|
71,382 |
|
|
|
71,512 |
|
|
|
69,833 |
|
|
Diluted |
|
71,536 |
|
|
|
71,382 |
|
|
|
71,512 |
|
|
|
69,833 |
|
|
|
|
|
|
|
|
|
(1) Noncash income (expense) related to change in the fair
value of the Company's outstanding and exercised |
warrants, classified as other income (expense). |
|
|
|
THRESHOLD PHARMACEUTICALS,
INC. |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(in thousands) |
|
|
|
|
|
September 30, |
|
December 31, |
|
|
2016 |
|
|
|
|
|
2015 |
|
|
|
|
(unaudited) |
|
|
|
|
(1 |
) |
|
|
Assets |
|
|
|
|
|
|
|
Cash, cash equivalents and |
|
|
marketable
securities |
$ |
28,110 |
|
|
$ |
|
|
48,680 |
|
|
|
Collaboration Receivable |
|
400 |
|
|
|
|
|
1,891 |
|
|
|
Prepaid expenses and other current assets |
|
1,022 |
|
|
|
|
|
2,599 |
|
|
|
Property and equipment, net |
|
159 |
|
|
|
|
|
333 |
|
|
|
Other assets |
|
- |
|
|
|
|
|
166 |
|
|
|
Total assets |
$ |
29,691 |
|
|
$ |
|
|
53,669 |
|
|
|
|
|
|
|
Liabilities and stockholders' equity |
|
|
|
|
|
Total current liabilities |
$ |
3,719 |
|
|
$ |
|
|
10,828 |
|
|
|
Long-term liabilities (2) |
|
3,051 |
|
|
|
|
|
1,995 |
|
|
|
Stockholders' equity (deficit) |
|
22,921 |
|
|
|
|
|
40,846 |
|
|
|
Total liabilities and stockholders' equity (deficit) |
$ |
29,691 |
|
|
$ |
|
|
53,669 |
|
|
|
|
|
|
|
|
|
|
|
(1) Derived from audited financial
statements |
(2) Includes as of September 30,
2016 and December 31, 2015, $3.0 million and $1.9 million of
warrant liability, respectively. |
Contact:
Denise Powell
denise@redhousecomms.com
510.703.9491
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