4SC AG
Press Release: 4SC Announces Financial Results for the First Quarter of 2015
4SC AG / Key word(s): Quarter Results/Forecast Press Release 4SC Announces Financial Results for the First Quarter of 2015 Planegg-Martinsried, Germany, 7 May 2015 – 4SC AG (Frankfurt, Prime Standard: ISIN DE000A14KL72, VSC), a discovery and development company of targeted small molecule drugs for cancer and autoimmune diseases, today published its consolidated financial results for the first three months of 2015 (1 January – 31 March 2015). Key operating events in Q1 2015 and beyond: – Resminostat: Successful conclusion of Asia/Pacific (APAC) licensing partnership with Menarini AP, subsidiary of the largest Italian pharma company Menarini Group. 4SC receives upfront payment plus potential further performance-related milestone payments totalling up to approximately EUR 95 million and is entitled to double-digit percentage royalty payments (April 2015). – Management team strengthened: Dr Susanne Danhauser-Riedl hired as Chief Medical Officer. The medical doctor with many years of experience in clinical practice in haematology/oncology and in the pharmaceutical industry in the field of medical affairs takes over as head of clinical development at 4SC (April 2015). – Resminostat: New preclinical data on resminostat’s activity as an immunomodulator indicate an attractive further potential of resminostat in combination with immunotherapies such as checkpoint inhibitors (March 2015). Key financial figures for the first three months of 2015: – Consolidated revenue boosted by 38% to EUR 1.99 million (Q1 2014: EUR 1.44 million). – Operating result (EBIT) improved by 37% to EUR -1.33 million (Q1 2014: EUR -2.12 million); loss per share reduced to EUR 0.03 (Q1 2014: EUR 0.04). – New share capital of EUR 10,169,841.00, as a result of the 1-for-5 reverse stock split, entered in the commercial register (April 2015). Enno Spillner, CEO of 4SC AG, commented: “4SC has made a very positive start to 2015. The new licensing partnership with Menarini for resminostat in Asia/Pacific not only strengthens the economic situation but also the overall enterprise value of 4SC. Through Menarini, and together with our existing partner Yakult Honsha for Japan, we have now access for resminostat to the complete APAC region – where 75% of all cases of liver cancer occur.” “This deal also expands our strategic options,” Enno Spillner added. “It enables us to consider, for the Western countries, additional development routes for resminostat beyond the liver cancer indication. Haematological niche indications such as e.g. CTCL, where HDAC inhibitors have already demonstrated their efficacy and received approval in the US, are particularly attractive. In Europe, no HDAC inhibitor has been approved yet. Therefore, an approval of a well-tolerated HDAC inhibitor such as resminostat in this setting seems a realistic development option requiring relatively moderate investment of time and resources. In parallel, we are also evaluating development options for our second promising epigenetic oncology compound, 4SC-202. In the person of Dr Susanne Danhauser-Riedl, we were able to acquire an experienced clinician recently who will be providing key momentum for the advancement of our oncology pipeline in her role as Chief Medical Officer at 4SC.” Enno Spillner continued: “Our achievements in the first quarter have been rewarded with positive share performance, and our improved financial results have confirmed our strategy. The focus of our efforts continues to be on promoting the further clinical development of our main value drivers and on securing funding for these endeavours. We are reviewing all our options and are confidently looking ahead to what will certainly be exciting months.” Telephone conference Today, on 7 May 2015, at 3:00 pm CEDT (9:00 am EDT), 4SC will host a telephone conference in English, in which the management of 4SC AG will report on the principal developments in the first quarter of 2015 and beyond. To participate in the telephone conference, please use the following data: +49-89-2030-31218 (Germany) After the telephone conference, an audio replay will be available at www.4sc.com under Investors / Events & Presentations / Conference Calls & Webcasts. Detailed financial review: The 4SC Group, which comprises 4SC AG and its wholly-owned subsidiary 4SC Discovery GmbH, reports consolidated figures for the Group in accordance with International Financial Reporting Standards (IFRSs) and financial figures for the two operating segments Development and Discovery & Collaborative Business. For more information on segment reporting, see the full 3-month consolidated financial report at (http://4sc.de/investors/financial-reports). Consolidated revenue was EUR 1.99 million in the first quarter of 2015, a substantial 38% year-on-year increase (Q1 2014: EUR 1.44 million). The increase in revenue was mainly due to allocations to Yakult Honsha of costs to produce the resminostat compound. Revenue in the Development segment consequently increased more than six-fold to EUR 1.42 million (Q1 2014: EUR 0.22 million), while the Discovery & Collaborative Business segment’s revenue fell, partly due to one-off effects in the previous year, by 53% to EUR 0.57 million (Q1 2014: EUR 1.22 million). The Company’s result from operating activities (EBIT) improved by 37% to EUR -1.33 million in the first quarter of 2015, primarily on the back of higher revenue (Q1 2014: EUR -2.12 million). The loss for the period decreased by 27% to EUR 1.54 million (Q1 2014: EUR 2.12 million). Earnings per share improved to EUR -0.03 (Q1 2014: EUR -0.04). This results in an average monthly outflow of cash from operations amounting to EUR 0.70 million in the reporting period (2014: EUR 0.71 million). As at 31 March 2015, the Company had cash totalling EUR 2.11 million, compared with EUR 3.20 million as at the close of 2014. In addition, 4SC AG may draw down a further EUR 3 million from the Santo loan and utilise tranches from the Yorkville funding via convertible bonds in an amount of up to EUR 14 million. Review of operations and performance in Research and Development and the Group in Q1 2015 and beyond and outlook: Development segment (clinical development activities of 4SC AG) Resminostat: The development of resminostat in APAC, including China and Japan, is of major strategic importance for 4SC, since one of the most important indications in resminostat’s clinical development programme – HCC – is particularly widespread in this region. To the best of 4SC’s knowledge, over 75% of all cases of liver cancer worldwide occur in the APAC region. Based on the ongoing and planned activities of the two Asian partners in the indication of liver cancer in Asia, 4SC has begun to evaluate resminostat’s further clinical development in Caucasian patient populations with a focus on other indications in addition to liver cancer. One attractive option would be a haematological niche indication such as cutaneous T-cell lymphoma (CTLC), for example, for which relatively rapid approval could be possible based on a comparatively low outlay of resources and a moderate risk profile. In CTCL, two HDAC inhibitors have already demonstrated efficacy and received market approval in the USA, although such compounds have yet to be approved in Europe. In addition, 4SC also presented initial preclinical data for resminostat in late March 2015 at the ITOC-2 Conference (Second Immunotherapy of Cancer Conference) in Munich. These data point to resminostat’s efficacy as an immunomodulator – a property that 4SC believes would be an outstanding addition to the anti-tumour activity the compound has already demonstrated. Efforts will be made to further confirm these preclinical data. 4SC’s Japanese development partner Yakult Honsha has also made progress in the development of the oral HDAC inhibitor resminostat in the reporting period. The partner is now examining the compound’s efficacy in two randomised Phase II trials in Japan in the indications of advanced liver cancer (HCC) and non-small-cell lung cancer (NSCLC). In both trials, the potential predictive biomarker ZFP64 is also being evaluated in order to be able to identify a patient population with the potential to respond especially well to treatment with resminostat. 4SC-202: Treatment of the last patient in the clinical Phase I TOPAS trial of 4SC-202 was completed in the first quarter of 2015. Last year, this study in heavily pre-treated patients with advanced malignant haematological disorders already returned positive top-line data for pharmacokinetics, safety and tolerability, as well as initial indications of anti-tumour activity on the part of 4SC-202. The data are currently being analysed for the final report, which is expected to be published in mid-2015. On the strength of previous results, the Company is currently engaged in the in-depth analysis of specific options and indications for the further clinical development of 4SC-202. 4SC is also talking to potential financing or industry partners as part of this work. 4SC-205: Discovery & Collaborative Business segment (research at 4SC Discovery GmbH): In February 2015, a licence agreement was signed with the French subsidiary of the Italian pharmaceutical company Mediolanum by Vienna-based Panoptes Pharma Ges.m.b.H., in which 4SC Discovery GmbH holds a 24.9% stake. Mediolanum acquired the marketing rights to Panoptes’s compound PP-001 in two important European countries. Panoptes received an upfront payment and is entitled to both performance-related milestone payments and royalty payments. PP-001, which was originally discovered by 4SC, is currently in preclinical development as a potential next-generation treatment for serious inflammatory eye diseases such as non-infectious uveitis. 4SC Discovery GmbH will participate from the further development success of PP-001 both with performance-related milestone payments and royalty payments from Panoptes. It is the aim of 4SC Discovery GmbH to continue the existing research partnerships and licence agreements with pharmaceutical and biotech companies as well as academic institutions and to establish new partnerships to secure financial contributions to the 4SC Group while advancing its own research programmes. Financial outlook: 4SC had funds of EUR 2.11 million at the end of the first quarter of 2015. In view of short- and medium-term revenue and expense planning and utilisation of the existing convertible note agreement with Yorkville as well as the further opportunity to draw down tranches from the loan agreement with Santo Holding (Deutschland) GmbH, 4SC believes that these funds are sufficient to finance the Company’s operations beyond the first quarter of 2016. Based on the current financial planning, particular the current planning for revenue that has yet to be met, the Management Board is expecting an average cash burn rate from operations of approx. EUR 0.20 million per month for 2015. New clinical trial starts, such as may follow successful financing, are not included in this forecast and would significantly change it. The same applies in the event of revenue targets being missed. For 2015, the Management Board anticipates a slight decrease in research and development costs and a further reduction in the consolidated net loss from operations as against 2014 as a result of a renewed drop in operating expenses and a rise in the contributions to earnings at the same time. This is, however, contingent on the Company’s research and development programmes and partnerships continuing to exist and running according to plan and no new clinical studies being started. In the event of funding being secured and the start of additional clinical Phase II trials – for instance with resminostat and/or 4SC-202 – the Company’s cost and cash flow structure will change markedly, with significant rises in both development expenses and the cash burn rate. End of release Über 4SC The Group managed by 4SC AG (ISIN DE000A14KL72) discovers and develops targeted, small-molecule drugs for treating diseases with high unmet medical needs in various cancer and autoimmune indications. These drugs are intended to provide innovative treatment options that are more tolerable and efficacious than existing therapies, and provide a better quality of life. The Company’s pipeline comprises promising products that are in various stages of clinical development. 4SC’s aim is to generate future growth and enhance its enterprise value by entering into partnerships with pharmaceutical and biotech companies. Founded in 1997, 4SC had a headcount of 68 employees (58 FTEs) at 31 March 2015. 4SC AG has been listed on the Prime Standard of the Frankfurt Stock Exchange since December 2005. Cautionary statement regarding forward-looking statements This press release contains certain forward-looking statements. Any forward-looking statement applies only on the date of this press release. By their nature, forward-looking statements are subject to a number of known and unknown risks and uncertainties that may or may not occur in the future and as a result of which the actual results and performance may differ substantially from the expected future results or performance expressed or implied in the forward looking statements. No warranties or representations are made as to the accuracy, achievement or reasonableness of such statements, estimates or projections, and 4SC AG has no obligation to update any such information or to correct any inaccuracies herein or omission herefrom which may become apparent. For more information please visit www.4sc.com or contact: 4SC AG MC Services The Trout Group 2015-05-07 Dissemination of a Corporate News, transmitted by DGAP – a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. 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Language: | English | |
Company: | 4SC AG | |
Am Klopferspitz 19a | ||
82152 Martinsried | ||
Germany | ||
Phone: | +49 (0)89 7007 63-0 | |
Fax: | +49 (0)89 7007 63-29 | |
E-mail: | public@4sc.com | |
Internet: | www.4sc.de | |
ISIN: | DE000A14KL72 | |
WKN: | A14KL7 | |
Listed: | Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Munich, Stuttgart, Tradegate Exchange | |
End of News | DGAP News-Service |
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