Infinity Reports Third Quarter 2012 Financial Results

  Infinity Reports Third Quarter 2012 Financial Results

   – Data from Clinical Trials of IPI-145 to be Presented at ACR and ASH –

  – Patient Enrollment Completed for Phase 2 Trial of Retaspimycin HCl Plus
                  Docetaxel in Non-Small Cell Lung Cancer –

    –Updated 2012 Financial Guidance Provided with Cash Runway Into 2014 –

Business Wire

CAMBRIDGE, Mass. -- November 06, 2012

Infinity Pharmaceuticals, Inc. (NASDAQ: INFI) today highlighted its recent
clinical and business progress and reported its financial results for the
third quarter of 2012.

“We have made strong progress across all aspects of our business during the
third quarter and now look forward to reporting near-term data for both our
PI3K and Hsp90 programs,” stated Adelene Q. Perkins, president and chief
executive officer at Infinity. “Data from clinical trials of IPI-145 will be
presented at two medical meetings this quarter. We have also completed patient
enrollment in our Phase 2 trial of retaspimycin HCl plus docetaxel in
non-small cell lung cancer, and we expect to report topline data from that
trial in the first half of 2013. Data from both of these programs will help to
inform our development plans in 2013 and beyond.”

Recent Highlights

  *Data from Phase 1 trial of IPI-145 in hematologic malignancies to be
    presented at ASH: Infinity announced that data from its ongoing Phase 1,
    open-label, dose-escalation trial of IPI-145 in patients with advanced
    hematologic malignancies will be presented at the 54^th American Society
    of Hematology (ASH) Annual Meeting and Exhibition being held in Atlanta,
    Georgia, from December 8 – 11, 2012. IPI-145 is a potent, oral inhibitor
    of PI3K-delta and -gamma in development for the treatment of hematologic
    malignancies and inflammatory disorders. The poster, entitled “Clinical
    safety and activity in a Phase 1 trial of IPI-145, a potent inhibitor of
    phosphoinositide-3-kinase (PI3K)-delta,gamma, in patients with advanced
    hematologic malignancies” (Abstract #3663), will be presented on Monday,
    December 10, 2012, from 6:00 p.m. to 8:00 p.m. ET in the Georgia World
    Congress Center, Hall B1-B2.

    Infinity will also host an investor reception on Monday, December 10,
    2012, from 8:00 p.m. to 10:00 p.m. ET to discuss IPI-145 and to review the
    data presented at ASH. The reception will be webcast beginning at 8:45
    p.m. ET and can be accessed in the “investors/media” section of Infinity’s
    website, www.infi.com. A replay of the event will also be available.

  *Data from Phase 1 trial of IPI-145 in healthy subjects to be presented at
    ACR: Infinity will present data from its completed Phase 1 trial of
    IPI-145 in healthy adult subjects during a poster session at the American
    College of Rheumatology (ACR)/Association of Rheumatology Health
    Professionals (ARHP) 2012 Annual Meeting being held in Washington, DC,
    from November 10 – 14, 2012. The poster, entitled “The potent
    phosphoinositide-3-kinase-delta,gamma inhibitor IPI-145 is active in
    preclinical models of arthritis and well tolerated in healthy adult
    subjects” (Abstract #338), will be presented on Sunday, November 11, 2012,
    from 9:00 a.m. to 6:00 p.m. ET in the Walter E. Washington Convention
    Center, Poster Hall B.
  *Enrollment completed in Phase 2 trial of retaspimycin HCl plus docetaxel
    in NSCLC: Infinity today announced that it has completed enrollment in its
    Phase 2, double-blind, randomized, placebo-controlled trial of
    retaspimycin hydrochloride (HCl) in combination with docetaxel in
    non-small cell lung cancer (NSCLC) patients with a history of smoking.
    Retaspimycin HCl is an intravenously administered, potent and selective
    heat shock protein 90 (Hsp90) inhibitor. The company expects to report
    topline overall survival data from this trial in the first half of 2013.
  *Phase 1b/2 trial of retaspimycin HCl plus everolimus in NSCLC ongoing:
    Infinity today reported that its Phase 1b/2 trial of retaspimycin HCl in
    combination with everolimus in NSCLC patients with an activating KRAS
    mutation is continuing. The Phase 1b portion of the study is designed to
    determine the recommended dose and schedule for the combination treatment.
    Infinity expects to provide topline data from the Phase 1b portion of the
    trial in the first half of 2013.
  *Steve H. Holtzman resigns from Infinity’s board of directors: Infinity
    today announced that Mr. Steven H. Holtzman, the company’s founder, has
    resigned from his positions as chair and a member of Infinity’s board of
    directors. Mr. Holtzman resigned to avoid the potential for a conflict of
    interest between his role as a member of Infinity’s board of directors and
    his role as executive vice president, corporate development of Biogen Idec
    Inc. that could have arisen from both companies having product development
    programs focused on inflammatory disorders. Mr. Holtzman has entered into
    a three-year agreement with Infinity to act as a strategic advisor to the
    company on non-conflicting matters. Mr. Holtzman served as Infinity's
    chair and chief executive officer from the company’s founding in 2001
    through 2009. Ms. Perkins has been named chair of Infinity’s board of
    directors.

“As Infinity’s founding chief executive officer, Steve established our culture
of Citizen-Ownership and built a strong foundation for the company that
positions us to achieve our mission of sustainably discovering, developing and
delivering important new medicines to patients and creating significant value
for shareholders,” said Ms. Perkins. “Steve’s vision, inspiration and counsel
have been invaluable to me on a personal and professional level, as well as to
the company. We are grateful for his leadership, passion and guidance over the
past 11 years and look forward to working with him as a strategic advisor
going forward.”

Third Quarter 2012 Financial Results

  *At September 30, 2012, Infinity had total cash, cash equivalents and
    available-for-sale securities of $189.4 million, compared to $104.6
    million at June 30, 2012. In August, Infinity completed an underwritten
    registered public offering of 6,095,000 shares of common stock at $14.50
    per share. The net proceeds to Infinity from the offering are
    approximately $83 million. In September, Infinity also received $27.5
    million in cash and extinguished its long-term debt following the
    completion of the sale and issuance of 5,416,565 shares of its common
    stock to Purdue Pharma L.P.
  *Gain related to the previous strategic alliance with Purdue and
    Mundipharma was $46.6 million for the third quarter of 2012. Infinity does
    not have any future research and development (R&D) obligations to Purdue
    and Mundipharma.
  *Infinity did not record any revenue during the third quarter of 2012, as
    the previous strategic alliance with Purdue and Mundipharma ended in July
    2012. Total revenue was $23.3 million for the same period in 2011, which
    was composed of $22.3 million for reimbursed R&D services performed under
    the strategic alliance with Purdue and Mundipharma and $1.0 million from
    the amortization of deferred revenue associated with the grant of rights
    and licenses under this alliance.
  *R&D expense for the third quarter of 2012 was $21.5 million, compared to
    $29.4 million for the same period in 2011. The decrease in R&D expense for
    the third quarter of 2012 compared to the same period in 2011 was
    primarily related to the discontinuation of development of the company’s
    Hedgehog pathway program.
  *General and administrative (G&A) expense for the third quarter of 2012 was
    $6.3 million, compared to $5.5 million for the same period in 2011. The
    increase in G&A expense for the third quarter of 2012 compared to the same
    period in 2011 was related primarily to a charge taken in connection with
    restructuring activities associated with its reduction in headcount
    previously announced.
  *Net income for the third quarter of 2012 was $18.4 million, or a basic
    earnings per common share of $0.57 and a diluted earnings per common share
    of $0.52, compared to a net loss of $11.9 million, or a basic and diluted
    loss per common share of $0.45, for the same period in 2011.

2012 Financial Guidance

Infinity today provided updated financial guidance for 2012.

  *Revenue: Infinity expects total revenue for 2012 to be $47.1 million,
    composed of $45.0 million for reimbursed R&D services from Mundipharma and
    $2.1 million due to the amortization of deferred revenue. Infinity does
    not expect to recognize any revenue in future periods from the previous
    strategic alliance with Purdue and Mundipharma.
  *Operating expenses: Infinity expects operating expenses for 2012 to range
    from $125 million to $135 million, revised from an earlier expectation of
    $135 million to $145 million.
  *Net loss: Infinity expects a net loss for 2012 to range from $35 million
    to $45 million.
  *Cash and investments: Infinity expects to end 2012 with a year-end cash
    and investments balance ranging from $155 million to $165 million, revised
    from an earlier expectation of $65 million to $75 million.

In the absence of additional funding or business development activities and
based on Infinity’s current operating plans, the company expects that its
current cash and investments are sufficient to fund its planned operations
into 2014. Importantly, Infinity expects its current cash runway to extend
through key data readouts that are expected from its ongoing clinical trials.

Conference Call Information

Infinity will host a conference call today, Tuesday, November 6, 2012, at 8:30
a.m. ET to discuss these financial results and provide an update on the
company. A live webcast of the conference call can be accessed in the
“investors/media” section of Infinity’s website at www.infi.com. To
participate in the conference call, please dial 1-877-316-5293 (domestic) or
1-631-291-4526 (international) five minutes prior to start time. The
conference ID number is 43452150. An archived version of the webcast will be
available on Infinity’s website for 30 days.

About Infinity Pharmaceuticals, Inc.

Infinity is an innovative drug discovery and development company seeking to
discover, develop and deliver to patients best-in-class medicines for diseases
with significant unmet need. Infinity combines proven scientific expertise
with a passion for developing novel small molecule drugs that target emerging
disease pathways. Infinity’s programs focused on the inhibition of
phosphoinositide-3-kinase and heat shock protein 90 are evidence of its
innovative approach to drug discovery and development. For more information on
Infinity, please refer to the company’s website at www.infi.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of
The Private Securities Litigation Reform Act of 1995. Such forward-looking
statements include those regarding the expected timing for reporting data on
the IPI-145 and Hsp90 programs, Infinity’s financial guidance with respect to
total revenue, operating expenses, net loss, and year-end cash for 2012, and
Infinity’s expectations with respect to the availability of cash to fund its
operations through key data inflection points into 2014. Such statements are
subject to numerous important factors, risks and uncertainties that may cause
actual events or results to differ materially from the company’s current
expectations. For example, there can be no guarantee that Infinity will report
data in the timeframes it has estimated, that any product candidate Infinity
is developing will successfully complete necessary preclinical and clinical
development phases or that development of any of Infinity’s product candidates
will continue. Further, there can be no guarantee that any positive
developments in Infinity’s product portfolio will result in stock price
appreciation. Management’s expectations could also be affected by risks and
uncertainties relating to: Infinity’s results of clinical trials and
preclinical studies, including subsequent analysis of existing data and new
data received from ongoing and future studies; the content and timing of
decisions made by the U.S. FDA and other regulatory authorities,
investigational review boards at clinical trial sites and publication review
bodies; Infinity’s ability to enroll patients in its clinical trials;
unplanned cash requirements and expenditures; development of agents by
Infinity’s competitors for diseases in which Infinity is currently developing
its product candidates; and Infinity’s ability to obtain, maintain and enforce
patent and other intellectual property protection for any product candidates
it is developing. These and other risks which may impact management’s
expectations are described in greater detail under the caption “Risk Factors”
included in Infinity’s Annual Report on Form 10-K for the year ended December
31, 2011 and subsequent filings filed by Infinity with the Securities and
Exchange Commission. Any forward-looking statements contained in this press
release speak only as of the date hereof, and Infinity expressly disclaims any
obligation to update any forward-looking statements, whether as a result of
new information, future events or otherwise.

INFINITY PHARMACEUTICALS, INC.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands)
                                                              
                                                September 30,   December 31,
                                                2012              2011
                                                                  
Cash, cash equivalents and available-for-sale   $   189,406       $   115,937
securities, including long term
Other current assets                                3,673             2,703
Property and equipment, net                         3,871             4,582
Other long-term assets                             1,241          1,268
                                                                  
Total assets                                    $   198,191     $   124,490
                                                                  
Current liabilities                             $   17,858        $   28,986
Long-term debt due to Purdue entities, net of       —                 37,553
debt discount
Deferred revenue from Purdue entities, less         —                 42,147
current portion
Other long-term liabilities                         606               371
Total stockholders’ equity                         179,727        15,433
                                                                  
Total liabilities and stockholders’ equity      $   198,191     $   124,490
                                                                  

INFINITY PHARMACEUTICALS, INC.

Condensed Consolidated Statements of Operations

(unaudited)

(in thousands, except share and per share amounts)
                                                   
                 Three Months Ended September 30,      Nine Months Ended September 30,
                 2012             2011               2012             2011
Collaborative
research and
development      $ —                $ 23,305           $ 47,114           $ 70,448
revenue from
Purdue
entities
Operating
expenses:
Research and       21,495             29,418             78,578             78,689
development
General and       6,294            5,470            20,771           16,675     
administrative
                                                                          
Total
operating          27,789             34,888             99,349             95,364
expenses
Gain on
termination of
Purdue            46,555           —                46,555           —          
entities
alliance
                                                                          
Income (loss)
from               18,766             (11,583    )       (5,680     )       (24,916    )
operations
Other income
(expense):
Interest           (533       )       (433       )       (1,908     )       (1,299     )
expense
Income from
Massachusetts      —                  —                  193                —
tax incentive
award
Interest and
investment        170              71               416              234        
income
                                                                          
Total other       (363       )      (362       )      (1,299     )      (1,065     )
expense
                                                                          
Net income       $ 18,403          $ (11,945    )     $ (6,979     )     $ (25,981    )
(loss)
                                                                          
Earnings
(loss) per
common share:
Basic            $ 0.57            $ (0.45      )     $ (0.24      )     $ (0.98      )
                                                                          
Diluted          $ 0.52            $ (0.45      )     $ (0.24      )     $ (0.98      )
                                                                          
Weighted
average number
of common
shares
outstanding:
Basic             32,039,866       26,666,332       28,638,512       26,590,597 
                                                                          
Diluted           35,173,223       26,666,332       28,638,512       26,590,597 

Contact:

Infinity Pharmaceuticals, Inc.
Jaren Irene Madden, 617-453-1336
Jaren.Madden@infi.com
http://www.infi.com
 
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