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OncoGenex Pharmaceuticals, Inc. Provides Clinical Development Update and Reports Financial Results for Third Quarter 2012



   OncoGenex Pharmaceuticals, Inc. Provides Clinical Development Update and
               Reports Financial Results for Third Quarter 2012

Conference call to be held on Thursday, November 8, 2012 at 4:30 p.m. Eastern
Time

PR Newswire

BOTHELL, Wash. and VANCOUVER, British Columbia, Nov. 8, 2012

BOTHELL, Wash. and VANCOUVER, British Columbia, Nov. 8, 2012 /PRNewswire/
-- OncoGenex Pharmaceuticals, Inc. (NASDAQ: OGXI) today announced third
quarter 2012 financial results and highlighted key clinical development
activities of its two product candidates, custirsen and OGX-427.

Custirsen Clinical Development Highlights

  o The Company announced completion of patient enrollment in the primary
    registration Phase 3 SYNERGY study. The SYNERGY study is designed to
    evaluate a survival benefit for custirsen, when added to first-line
    chemotherapy, in men with metastatic castrate-resistant prostate cancer
    (mCRPC). Over 1000 men have now been enrolled.  The survival primary
    endpoint data are event-driven and results are expected by the end of
    2013.
  o The Phase 3 AFFINITY study, evaluating a survival benefit for custirsen in
    combination with Jevtana® (cabazitaxel) as second-line chemotherapy in
    approximately 630 men with CRPC, was initiated in the third quarter. This
    global study will be conducted at sites throughout North America, Europe
    and Australia.
  o The ENSPIRIT trial, an international, randomized Phase 3 study in
    approximately 1,100 patients with advanced or metastatic non-small cell
    lung cancer (NSCLC), was initiated in the third quarter. The trial will
    evaluate the potential survival benefit of combining custirsen with
    docetaxel as a second-line chemotherapy in patients who have progressed
    after initial chemotherapy treatment has failed.

OGX-427 Clinical Development Highlights

  o Preliminary data from an investigator-sponsored Phase 2 clinical trial of
    OGX-427 in chemotherapy-naive patients with metastatic CRPC were presented
    at the European Society for Medical Oncology Annual Meeting (ESMO) in
    September 2012. The updated study results showed a higher number of
    patients without disease progression at 12 weeks and greater declines in
    prostate-specific antigen (PSA) and circulating tumor cells (CTC) with
    OGX-427 plus prednisone treatment compared to prednisone alone. The study
    continues to demonstrate an acceptable safety profile of OGX-427 and final
    study results are expected in 2013.
  o The randomized, Phase 2 clinical trial of OGX-427 in patients with
    metastatic bladder cancer continues patient accrual, with sites throughout
    North America and Europe. The trial aims to enroll approximately 180
    patients and will evaluate the overall survival benefit of OGX-427 in
    combination with gemcitabine and cisplatin.
  o An investigator-sponsored, randomized Phase 2 study evaluating OGX-427 in
    combination with Zytiga® (abiraterone acetate) in patients with CRPC is
    expected to begin enrollment in late 2012 or early 2013.

Third Quarter 2012 Financial Update and Results

  o Revenue for the third quarter and nine months ended September 30, 2012
    increased to $6.6 million and $10.3 million, respectively, compared with
    $1.2 million and $4.3 million, respectively, in the same periods in 2011.
    The increase in 2012 as compared to 2011 was due to higher revenue earned
    through our strategic collaboration with Teva, resulting from clinical
    development activities associated with the AFFINITY trial.
  o As of September 30, 2012, $9.1 million of the $30 million advanced
    reimbursement received from Teva in December 2009 was included on our
    Balance Sheet as Current Deferred Collaboration Revenue. This advance
    reimbursement balance will continue to be reduced as we incur direct and
    indirect custirsen development costs. As a consequence of initiating the
    AFFINITY trial, we continue to expect that all remaining Current Deferred
    Collaboration Revenue will be recognized as Collaboration Revenue by the
    fourth quarter of 2012. Once the remaining amount of the advanced
    reimbursement from Teva has been drawn to zero, all of our costs
    associated with the clinical programs under our collaboration will be
    reimbursed by Teva quarterly.
  o Total operating expenses for the third quarter and nine months ended
    September 30, 2012 increased to $14.9 million and $30.1 million,
    respectively, compared with $5.3 million and $18.6 million, respectively,
    in the same periods in 2011. The increase in 2012 as compared to 2011 was
    due primarily to higher clinical study expenses associated with the
    startup of the AFFINITY trial, patient enrollment in our clinical trial
    evaluating OGX-427 in patients with metastatic bladder cancer and
    associated manufacturing costs and higher employee expenses, including
    stock based compensation expenses.  These increases were partially offset
    by lower preclinical expenses.
  o Net loss for the third quarter and nine months ended September 30, 2012
    was $5.9 million, or $0.40 per diluted common share, and $17.0 million, or
    $1.29 per diluted common share, respectively. This is compared with net
    income of $4.5 million, or $0.45 per diluted common share in the three
    months ended September 30, 2011 and a net loss of $5.1 million, or $0.52
    per diluted common share for the nine months ended September 30, 2011. 
    The net loss in the three and nine months ended September 30, 2012
    included a non-cash gain on revaluation of our warrant liability of $2.3
    million and $2.5 million, respectively.  The net income in the three
    months ended September 30, 2011 included an $8.6 million non-cash gain on
    revaluation of our warrant liability and the net loss in the nine months
    ended September 30, 2011 included a $9.0 million non-cash gain on
    revaluation of our warrant liability.
  o We had $85.1 million in cash, cash equivalents and short-term investments
    as of September 30, 2012, compared to $64.9 million as of December 31,
    2011.
  o 2012 cash guidance:

       o Annual net cash requirements are expected to be in the range of $45
         million to $50 million.
       o Year-end cash, cash equivalents, investments and receivables from
         Teva are expected to be in the range of $68 million to $73 million
         and include the receipt of proceeds from our March offering of common
         stock.

  o Based on our current expectations, we believe our capital resources as of
    September 30, 2012 will be sufficient to fund our currently planned
    operations into 2015.
  o At November 7, 2012, we had 14,656,916 shares outstanding.

 

Consolidated Statements of Loss (Income)
(In thousands, except per share and share data)
(unaudited)

 
                         Three months ended        Nine months ended

                         September 30,             September 30,
                         2012          2011        2012          2011
Collaboration revenue    $             $           $             $          
                         6,570          1,174         10,315           4,260
 

Operating expenses:
Research and development 12,895        3,814       24,303        14,076
General and              1,965         1,457       5,749         4,499
administrative
 Total operating         14,860        5,271       30,052        18,575
expenses
Loss from operations     8,290         4,097       19,737        14,315
  Other income (expense) 2,370         8,567       2,742         9,211
Loss (income) for the
period before income     5,920         (4,470)     16,995        5,104
taxes
  Income taxes           -             -           -             -
Net loss (income)        $             $           $             $          
                          5,920         (4,470)     16,995             5,104
Basic net loss (income)  $             $           $             $          
per share                 0.40          (0.46)          1.29             0.52
Diluted net loss         $             $           $             $          
(income) per share        0.40          (0.45)          1.29             0.52
Weighted average number  14,619,82     9,736,589   13,141,940    9,722,836
of basic common shares
Weighted average number  14,619,82     10,043,821  13,141,940    9,722,836
of diluted common shares
 

Consolidated Balance Sheets
(In thousands)

 
                                                   September 30, December 31,

                                                   2012          2011
                                                   (unaudited)

                                                    
Assets:
  Cash, cash
equivalents, short term                            $             $          
                                                   85,387          65,304
  investments and
restricted cash
  Amounts receivable                               1,138         812
  Prepaid and other                                9,292         1,210
current assets
  Property, equipment
and other                                          1,355         689

  assets
Total assets                                       $             $          
                                                   97,172          68,015
Liabilities and
stockholders' equity:
  Accounts payable and
accrued                                            $             $          
                                                     5,718           3,217
  liabilities
  Deferred collaboration                           9,145         18,271
revenue
  Current portion of
long-term                                          1,451         1,417

  obligations
  Warrant liability                                5,359         7,881
  Long term liabilities                            5,738         6,339
  Stockholders' equity                             69,761        30,890
Total liabilities and                              $             $          
stockholders' equity                                97,172         68,015

 

Conference Call Details
OncoGenex will host a conference call at 4:30 p.m. Eastern Time today,
Thursday, November 8, 2012, to provide a business update and discuss the third
quarter results. A live event will be available on the Investor Relations
section of the OncoGenex Web site at www.OncoGenex.com. Alternatively, you may
access the live conference call by dialing 877-606-1416 (U.S. & Canada) or
707-287-9313 (International). A replay of the webcast will be available
approximately two hours after the call and will be archived for 90 days.

ABOUT ONCOGENEX
OncoGenex is a biopharmaceutical company committed to the development and
commercialization of new therapies that address treatment resistance in cancer
patients. OncoGenex has a diverse oncology pipeline, with each product
candidate having a distinct mechanism of action and representing a unique
opportunity for cancer drug development. OncoGenex and Teva Pharmaceutical
Industries Ltd. (NYSE: TEVA) have entered a global collaboration and license
agreement to develop and commercialize OncoGenex' lead drug candidate,
custirsen. Custirsen is currently in Phase 3 clinical development as a
treatment in men with metastatic castrate-resistant prostate cancer (CRPC) and
in patients with advanced, unresectable non-small cell lung cancer. OGX-427 is
in Phase 2 clinical development in CRPC and metastatic bladder cancer. OGX-225
is currently in pre-clinical development. More information is available at
www.OncoGenex.com.

OncoGenex' Forward Looking Statements
This press release contains forward-looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation Reform Act
of 1995, including, but not limited to, statements concerning our anticipated
product development activities, such as expected clinical trial completion,
statements regarding the potential benefits and potential development of our
product candidates and statements regarding our expected financial results and
our expected future cash resources and liquidity. All statements other than
statements of historical fact are statements that could be deemed
forward-looking statements. These statements are based on management's current
expectations and beliefs and are subject to a number of risks, uncertainties
and assumptions that could cause actual results to differ materially from
those described in the forward-looking statements. Such forward-looking
statements are subject to risks and uncertainties, including, among others,
the risk that final trial results will not demonstrate the same or any
potential benefit as observed in preliminary trial results, the risk that
subsequent studies may not confirm earlier trial results, the risk of delays
in our expected clinical trials, the risk that new developments in the rapidly
evolving cancer therapy landscape require changes in our clinical trial plans
or limit the potential benefits of our product, the risk that our cash
requirements are greater than expected or that our resources are insufficient
to fund our planned activities for the time period expected and the other
factors described in our risk factors set forth in our filings with the
Securities and Exchange Commission from time to time, including the Company's
Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company
undertakes no obligation to update the forward-looking statements contained
herein or to reflect events or circumstances occurring after the date hereof,
other than as may be required by applicable law.

JEVTANA® is a registered trademark of sanofi-aventis

Zytiga® is a registered trademark of the Johnson & Johnson Corporation

SOURCE OncoGenex Pharmaceuticals, Inc.

Website: http://www.OncoGenex.com
Contact: Media - Jaime Welch, jwelch@oncogenex.com, +1-604-630-5403, or
Investor Relations - Susan Specht, sspecht@oncogenex.com, +1-425-686-1535
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