Opexa Therapeutics Inc : Opexa Therapeutics Reports Third Quarter 2013 Financial Results and Provides Corporate Update
11/07/2013 | 04:07pm US/Eastern
Opexa Therapeutics, Inc. (NASDAQ: OPXA), a biotechnology company developing Tcelna®, a novel T-cell immunotherapy for the treatment of multiple sclerosis (MS), today reported financial results for the third quarter ended September 30, 2013 and provided an overview of the Company's recent corporate developments.
Recent highlights include:
•Clinical
- As of November 6, 2013, enrolled 100 patients in the Phase IIb "Abili-T" clinical study of Tcelna (imilecleucel-T) in patients with Secondary Progressive Multiple Sclerosis (SPMS). The Abili-T clinical trial is a randomized, double-blind, placebo-controlled study designed to enroll 180 patients at approximately 33 leading clinical sites in the U.S. and Canada.
- Furthered the accumulation of comprehensive patient data to support Opexa's Immune Monitoring Program initiative in conjunction with the Abili-T trial, including the potential identification of biomarkers for SPMS and further understanding of the immunopathology of SPMS.
•Financial
- Reported cash and cash equivalents of $20,172,485 as of September 30, 2013.
- Closed an underwritten public offering of 12 million shares of common stock in August 2013 and sold an additional 900,000 shares of common stock in September 2013 through the exercise of an over-allotment option granted to the underwriter of the public offering, with aggregate gross proceeds of $19.4 million, or net proceeds of approximately $17.4 million after deducting underwriting discounts and commissions and estimated offering expenses.
- Eliminated debt on Opexa's consolidated balance sheet through the conversion into common stock of the remaining July 2012 convertible secured promissory notes in an aggregate principal amount of $3.185 million.
- Terminated the remaining $500,000 deposit control agreement in connection with conversion of the July 2012 convertible secured promissory notes, resulting in the funds being reported as cash and cash equivalents on the consolidated balance sheet instead of as restricted cash.
•Operational
- Strengthened the team with the addition of several talented individuals dedicated to furthering the Company's development initiatives, including enhancing the manufacturing and delivery of Tcelna.
"We recently reached a major milestone by enrolling the 100th patient into the Abili-T study," commented Neil K. Warma, Opexa's President and Chief Executive Officer. "With the recent addition of three new clinical trial sites in the U.S., we now have 33 centers across North America participating in the Abili-T study," added Mr. Warma. "We expect to complete enrollment of 180 patients in early 2014 and release the top-line results of the study in the middle of 2016."
"On the financial front, we focused our efforts this quarter on strengthening and cleaning up our balance sheet," commented Karthik Radhakrishnan, Opexa's Chief Financial Officer. "Following the receipt of net proceeds of approximately $17.4 million through our August 2013 public offering and the subsequent exercise of the underwriters' over-allotment option, we ended the quarter with over $20 million of cash and cash equivalents. In addition, we eliminated the remaining $3.185 million principal amount of the July 2012 convertible secured promissory notes through the conversion of principal and accrued interest into shares of our common stock," added Mr. Radhakrishnan.
"The Company's cash position is the highest it has been at any previous quarter-end in its recent history, and this positions Opexa to pursue shareholder value by continuing to execute on our clinical mission," added Mr. Warma. "With the recent infusion of capital along with the conversion of the July 2012 Notes into common stock, our cash position now takes us into the first quarter of 2015."
Third Quarter Financial Results
Opexa reported revenue of $348,837 and $917,774 for the three and nine months ended September 30, 2013, respectively. The revenue is related to the recognized portion of the $5 million upfront payment received from Merck Serono in conjunction with the Option and License Agreement entered into between Opexa and Merck Serono during February 2013. The unearned revenue is being recognized over the expected term of Merck's period to exercise its option to license Tcelna for MS. No revenues were recognized during the three and nine months ended September 30, 2012.
Research and development expenses were $2,494,463 and $6,338,859 for the three and nine months ended September 30, 2013, respectively, compared with $1,455,938 and $4,504,243 for the three and nine months ended September 30, 2012, respectively. The increase was primarily due to costs associated with the initiation of clinical sites and increasing enrollment of patients for the Abili-T clinical study, including increases in manufacturing, the number of employees and registration costs in connection with the Company's patent portfolio. Expenses were partially offset by costs associated with the training and qualification activities preceding the commencement of the Abili-T clinical trial in the second half of 2012.
General and administrative expenses for the three and nine months ended September 30, 2013 were $626,668 and $2,479,708, respectively, compared with $532,474 and $1,878,236 for the three and nine months ended September 30, 2012, respectively. The increase was primarily due to a modest increase in employees to support the ongoing clinical trial and increases in legal and stock compensation expenses. The increase for the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012 was partially offset by a decrease in other professional fees.