Galectin Therapeutics Reports Third Quarter 2012 Financial Results

  Galectin Therapeutics Reports Third Quarter 2012 Financial Results

Business Wire

NORCROSS, Ga. -- November 09, 2012

Galectin Therapeutics Inc. (NASDAQ: GALT), the leading developer of
therapeutics that target galectin proteins to treat fibrosis and cancer, today
reported its financial results for the third quarter and first nine months
ended September 30, 2012. These results are included in the Company’s
Quarterly Report on Form 10-Q, which has been filed with the SEC.

“We have continued to make progress with our primary candidate, GM-CT-01 in
melanoma, part of our pipeline of galectin inhibitors in cancer,” said Peter
G. Traber, M.D., Chief Executive Officer, President and Chief Medical Officer,
Galectin Therapeutics. “There is strong in vitro data that demonstrates that
GM-CT-01 can protect immune cells from the ‘Galectin Effect’; whereby tumors
secrete galectin proteins that block the body’s efforts to fight tumors. The
trial, being conducted in collaboration with the Cancer Centre at the
Cliniques Universitaires Saint-Luc and the Ludwig Institute for Cancer
Research (LICR) in Brussels, is evaluating GM-CT-01 in combination with a
Ludwig Institute peptide vaccine. In May, the first patient was dosed in a
Phase 1/2 trial evaluating the safety and efficacy of GM-CT-01 in combination
with a peptide tumor vaccine in metastatic melanoma. This trial is being
conducted in two stages, and the results of the first stage will determine the
timing and conduct of the second stage. We expect to have top-line clinical
results for the first group of patients from the first stage of this trial in
the second quarter of 2013.”

“The preclinical development of Galectin’s lead candidate for the treatment of
liver fibrosis, GR-MD-02, continues on track and we expect to file an
investigational new drug application (IND) with the US FDA by January 2013.
Following the filing of the IND, we plan to initiate a Phase 1 clinical trial
of GR-MD-02 in patients with nonalcoholic steatohepatitis (NASH) and fibrosis
in early 2013 followed by a Phase 2 study potentially beginning by early 2014
with expected top-line clinical results by the end of 2014 or early 2015. The
novel mechanism of GR-MD-02, in combination with compelling preclinical data,
gives us great hope that this compound may ultimately meet the needs of these
patients with this deadly disease that has no currently approved therapeutic
options.”

At September 30, 2012, the Company had $11.1 million of non-restricted cash
and cash equivalents available to fund future operations. The Company believes
that with the funds on hand at September 30, 2012, there is sufficient cash to
fund core operations and planned research and development activities through
2013.

For the third quarter of 2012, the Company reported a net loss applicable to
common stock of $3.0 million, or ($0.19) per share, basic and diluted,
compared with a net loss applicable to common stock of $2.3 million or ($0.19)
per share for the same period in 2011. For the nine months ended September 30,
2012, the Company reported a net loss applicable to common stock of $8.2
million, or ($0.55) per share, basic and diluted, compared with a net loss of
$9.0 million, or ($0.77) per share for the same period in 2011. The weighted
average number of shares used to calculate loss per share increased for the
2012 periods compared to the 2011 periods due primarily to the March 2012
offering of 2.7 million common shares as well as the payment of dividends in
common stock.

Research and development expense for the third quarter of 2012 increased to
$1.4 million, compared with $0.7 million for the same period in 2011, due
primarily to increased preclinical activities related to preparations for
filing an IND for GR-MD-02. General and administrative expense for the third
quarter of 2012 increased to $1.5 million, compared with $1.4 million for the
same period in 2011, due primarily to increased stock-based compensation,
partially offset by decreased legal expenses.

Research and development expense for the nine-months ended September 30, 2012,
increased to $3.5 million compared with $2.7 million for the same period in
2011, due primarily to increased activity in clinical and preclinical programs
related to our Phase 1/2 clinical trial for GM-CT-01 and our work related to
preparing for filing the IND for GR-MD-02, partially offset by decreased
stock-based compensation expense. General and administrative expense for the
nine-months ended September 30, 2012, decreased to $4.0 million compared with
$4.3 million for the same period in 2011, due primarily to decreased legal and
business development expenses, partially offset by increased stock-based
compensation and overhead costs.

In October, the Company reported that it had terminated its agreement with
PROCAPS, S.A. (PROCAPS) to gain approval of GM-CT-01 in Columbia. The Company
has no current plans to continue attempts to gain approval of GM-CT-01 in
Columbia. As a result of the termination of the PROCAPS agreement, the Company
recognized $0.2 million of deferred income in Other Income during the three
and nine-month periods ended September 30, 2012. No further income is expected
related to this agreement and a future revenue stream from this terminated
agreement had not been taken into account in any of Galectin’s financial
projections. The results for the nine-months ended September 30, 2011,
included $0.5 million in Other Income of non-cash expense related to the
change in the fair value of warrants.

About Galectin Therapeutics

Galectin Therapeutics (NASDAQ: GALT) is developing promising
carbohydrate-based therapies for the treatment of fibrotic liver disease and
cancer based on the Company’s unique understanding of galectin proteins, key
mediators of biologic function. We are leveraging extensive scientific and
development expertise as well as established relationships with external
sources to achieve cost effective and efficient development. We are pursuing a
clear development pathway to clinical enhancement and commercialization for
our lead compounds in liver fibrosis and cancer. Additional information is
available at www.galectintherapeutics.com.

Forward Looking Statements

This press release contains, in addition to historical information,
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements relate to future events or
future financial performance, and use words such as “may,” “estimate,”
“could,” “expect” and others. These statements include Company plans and
expectations regarding clinical trials, expectations regarding the
effectiveness and potential benefits of our products, and expectations
regarding the sufficiency of cash to fund core operations and planned research
and development activities through 2013. They are based on our current
expectations and are subject to factors and uncertainties which could cause
actual results to differ materially from those described in the statements.
Factors that could cause our actual performance to differ materially from
those discussed in the forward-looking statements include, among others:
incurrence of operating losses since our inception, uncertainty as to adequate
financing of our operations, extensive and costly regulatory oversight that
could restrict or prevent product commercialization, potential delays in our
ability to initiate and successfully complete clinical trials, possible
negative results from our clinical trials, inability to achieve commercial
product acceptance, inability to protect our intellectual property, dependence
on strategic partnerships, product competition, and others stated in risk
factors contained in our Annual Report on Form 10-K for the year ended
December 31, 2011 and our subsequent SEC filings. We cannot assure that we
have identified all risks or that others may emerge which we do not
anticipate. You should not place undue reliance on forward-looking statements.
Although subsequent events may cause our views to change, we disclaim any
obligation to update forward-looking statements.

Condensed Consolidated Statements of Operations

                             Three Months              Nine Months

                            Ended                    Ended

                             September 30,             September 30,
                              2012      2011       2012      2011   
                             (in thousands, except per share data) (unaudited)
Operating expenses:
Research and development     $ 1,409      $ 655        $ 3,525      $ 2,690
General and administrative    1,487     1,378     3,992     4,347  
Total operating expenses      2,896     2,033     7,517     7,037  
Total operating loss          (2,896 )   (2,033 )   (7,517 )   (7,037 )
Other income (expense),       207       5         218       (510   )
net
Net loss                     $ (2,689 )  $ (2,028 )  $ (7,299 )  $ (7,547 )
Preferred stock dividends     (296   )   (311   )   (874   )   (1,448 )
and accretion costs
Net loss applicable to       $ (2,985 )  $ (2,339 )  $ (8,173 )  $ (8,995 )
common stock
Basic and diluted net loss   $ (0.19  )   $ (0.19  )   $ (0.55  )   $ (0.77  )
per share
Shares used in computing
basic and diluted net loss     15,822       12,353       14,851       11,697
per share

Condensed Consolidated Balance Sheet Data

                                      September 30, 2012  December 31, 2011
                                       (in thousands, unaudited)
Cash and cash equivalents             $      11,059       $    6,397
Total assets                                  11,193             6,612
Total liabilities                             1,442              2,215
Total stockholders’ equity (deficit)  $      3,057        $    (2,125   )

Contact:

Galectin Therapeutics
Tom McGauley, 678-620-3186
Acting Chief Financial Officer
ir@galectintherapeutics.com
 
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