MEI Pharma Reports Fiscal Year 2020 Results and Operational Highlights
"This past year was marked by progress on multiple fronts, particularly for zandelisib, formerly called ME-401, which is our PI3K delta inhibitor in the Phase 2 TIDAL study intended to support an accelerated approval marketing application with FDA," said Daniel
Fiscal Year 2020 Zandelisib (ME-401) and Corporate Highlights
Zandelisib (formerly called ME-401), an oral, once-daily, investigational drug-candidate selective for phosphatidylinositol 3-kinase delta (PI3Kδ), for B-Cell Malignancies
- The
World Health Organization approved "zandelisib" as the International Nonproprietary Name, or INN, for ME-401, the Company's investigational cancer treatment being developed as an oral, once-daily, selective PI3Kδ inhibitor for the treatment of B-cell malignancies. - In
May 2020 , the Company and Kyowa Kirin Co. presented updated data at theAmerican Society of Clinical Oncology (ASCO) 2020 Virtual Scientific Program from a Phase 1b study of zandelisib (ME-401) for the treatment of B-cell malignancies. These data evaluating patients on an intermittent dosing schedule of zandelisib showed that treatment was generally well tolerated and demonstrated an 83% overall response rate in patients with relapsed or refractory follicular lymphoma (n=36). The responses were durable with no median yet reached (median follow-up of 13.2 months: range: 3.0-27.6). - In April 2020, the Company entered into a global license, development and commercialization agreement with Kyowa Kirin Co. to further develop and commercialize MEI's zandelisib:
- MEI and Kyowa Kirin will co-develop and co-promote zandelisib in the
U.S.
- MEI to book
U.S. sales on 50-50 profit and cost sharing.
- MEI to book
$100 million upfront cash payment to MEI.$582.5 million in potential development, regulatory and commercial milestones- Kyowa Kirin obtains exclusive commercialization rights ex-
U.S.
- MEI to receive escalating tiered royalty payments starting in the teens on ex-
U.S. sales.
- MEI to receive escalating tiered royalty payments starting in the teens on ex-
- MEI and Kyowa Kirin will co-develop and co-promote zandelisib in the
- In March 2020, the Company was granted Fast Track designation by the
U.S. FDA for zandelisib for the treatment of adult patients with relapsed or refractory follicular lymphoma.
Corporate Highlights
- In April 2020, Cheryl L. Cohen, former chief commercial officer of
Medivation, Inc. and a product launch and commercialization veteran with over 25 years of service in the pharmaceutical and biotechnology industry, joined the Board of Directors. - In
December 2019 , the Company closed an underwritten public offering of 32,343,750 shares of its common stock for total gross proceeds of approximately $51,750,000. Additionally, during the year endedJune 30, 2020 , MEI sold 5,471,684 shares under the ATM Sales Agreement for net proceeds of$20.8 million . - In July 2019, Tamar Howson, M.S., MBA, a highly experienced business development executive with over 30 years of service in the pharmaceutical and biotechnology industry, joined the Board of Directors.
Fiscal Year 2020 Financial Results
- As of
June 30, 2020 , MEI had$182.6 million in cash, cash equivalents, and short-term investments with no outstanding debt. Additionally, MEI has a receivable of$20.4 million that is expected to be received from the Japanese taxing authorities in fiscal year 2021 that was withheld from the$100 million paid by Kyowa Kirin Co. under the terms ofApril 2020 global license, development and commercialization agreement. The withholding was a result of the US Internal Revenue Service being closed because of the COVID pandemic, resulting in an inability to provide the necessary documentation to support an exemption from the required foreign withholding. - For the year ended
June 30, 2020 , cash used in operations was$45.3 million compared to$39.4 million for 2019. - Research and development expenses were
$34.1 million for the year endedJune 30, 2020 , compared to$32.3 million for 2019. The increase was primarily related to increased development costs associated with zandelisib, as well as increased personnel costs to support our clinical trial activities. - General and administrative expenses were
$16.7 million for the year endedJune 30, 2020 , compared to$14.6 million for 2019. The increase primarily relates to personnel costs and general corporate expenses incurred during the year endedJune 30, 2020 . - MEI recognized revenues of
$28.9 million for the year endedJune 30, 2020 , compared to$4.9 million for the year endedJune 30, 2019 . Revenues resulted from the recognition of license revenue associated with the Kyowa Kirin license agreement as well as fees allocated to research and development activities related to the Kyowa Kirin andHelsinn license agreements. - Net loss was
$46.0 million , or$0.51 per share, for the fiscal year endedJune 30, 2020 , compared to net loss of$16.8 million , or$0.24 per share for 2019. The Company had 111,513,689 shares of common stock outstanding as ofJune 30, 2020 , compared with 73,544,576 shares as ofJune 30, 2019 . - The adjusted net loss for the fiscal year ended
June 30, 2020 , excluding non-cash expenses related to changes in the fair value of the warrants issued in connection with theMay 2018 financing (a non-GAAP measure), was$23.1 million .
Conference Call and Webcast
About
Forward-Looking Statements
Under
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BALANCE SHEETS |
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(In thousands, except per share amounts) |
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2020 |
2019 |
||
ASSETS |
|||
Current assets: |
|||
Cash and cash equivalents |
$ 12,331 |
$ 9,590 |
|
Short term investments |
170,299 |
64,899 |
|
Total cash, cash equivalents and short-term investments |
182,630 |
74,489 |
|
Receivable for foreign tax withholding |
20,420 |
- |
|
Common stock proceeds receivable |
- |
5,274 |
|
Prepaid expenses and other current assets |
5,594 |
2,435 |
|
Total current assets |
208,644 |
82,198 |
|
Intangible assets, net |
- |
261 |
|
Property and equipment, net |
1,084 |
204 |
|
Total assets |
$ 209,728 |
$ 82,663 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
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Current liabilities: |
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Accounts payable |
$ 2,437 |
$ 4,787 |
|
Accrued liabilities |
6,090 |
4,559 |
|
Deferred revenue |
14,777 |
4,955 |
|
Total current liabilities |
23,304 |
14,301 |
|
Deferred revenue, long-term |
67,723 |
2,819 |
|
Warrant liability |
40,483 |
17,613 |
|
Total liabilities |
131,510 |
34,733 |
|
Stockholders' equity: |
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Preferred stock, |
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none outstanding |
- |
- |
|
Common stock, |
|||
authorized; 111,514 and 73,545 shares issued and outstanding |
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at |
- |
- |
|
Additional paid-in-capital |
355,452 |
279,148 |
|
Accumulated deficit |
(277,234) |
(231,218) |
|
Total stockholders' equity |
78,218 |
47,930 |
|
Total liabilities and stockholders' equity |
$ 209,728 |
$ 82,663 |
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STATEMENTS OF OPERATIONS |
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(In thousands, except per share amounts) |
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Years Ended |
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2020 |
2019 |
2018 |
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Revenue |
$ 28,913 |
$ 4,915 |
$ 1,622 |
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Operating expenses: |
||||||
Cost of revenue |
2,671 |
4,263 |
3,383 |
|||
Research and development |
34,065 |
32,300 |
17,038 |
|||
General and administrative |
16,717 |
14,597 |
9,787 |
|||
Total operating expenses |
53,453 |
51,160 |
30,208 |
|||
Loss from operations |
(24,540) |
(46,245) |
(28,586) |
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Other income (expense): |
||||||
Change in fair value of warrant liability |
(22,870) |
27,632 |
(9,705) |
|||
Financing costs associated with warrants |
- |
- |
(2,367) |
|||
Interest and dividend income |
1,395 |
1,795 |
591 |
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Income tax expense |
(1) |
(1) |
(1) |
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Net loss |
$ (46,016) |
$ (16,819) |
$ (40,068) |
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Net loss: |
||||||
Basic |
$ (46,016) |
$ (16,819) |
$ (40,068) |
|||
Diluted |
$ (46,016) |
$ (54,613) |
$ (40,068) |
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Net loss per share: |
||||||
Basic |
$ (0.51) |
$ (0.24) |
$ (0.97) |
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Diluted |
$ (0.51) |
$ (0.75) |
$ (0.97) |
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Shares used in computing net loss per share: |
||||||
Basic |
91,080 |
71,139 |
41,431 |
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Diluted |
91,080 |
72,385 |
41,431 |
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Reconciliation of GAAP Net Loss to Adjusted Net Loss |
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(In thousands) |
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Years Ended |
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2020 |
2019 |
2018 |
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Net loss: |
$ (46,016) |
$ (16,819) |
$ (40,068) |
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Add: Change in fair value of warrant liability |
22,870 |
(27,632) |
9,705 |
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Adjusted net loss: |
$ (23,146) |
$ (44,451) |
$ (30,363) |
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Receivable for foreign tax withholding |
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