BioLineRx Reports Third Quarter 2012 Financial Results

  BioLineRx Reports Third Quarter 2012 Financial Results

Business Wire

JERUSALEM -- November 14, 2012

BioLineRx Ltd. (NASDAQ: BLRX)(TASE: BLRX), a biopharmaceutical development
company, today reported its results for the third quarter ending September 30,
2012.

Highlights of the Third Quarter of 2012 and Recent Developments:

  *BL-1020 (Schizophrenia):

       *Re-analysis of the Phase IIb EAGLE trial results indicates that
         BL-1020 demonstrated a significantly greater beneficial effect on
         cognitive function in schizophrenia patients compared to the original
         analysis of the study
       *Announced the decision to conduct an interim analysis of Phase II/III
         CLARITY clinical trial, with results expected in Q1 2013
       *Results from the Phase IIb EAGLE clinical trial, showing that BL-1020
         is safe and effective in improving schizophrenia in addition to
         improving cognitive impairment, were published in the Journal of
         Clinical Psychiatry
       *New U.S. patent on BL-1020, extending patent protection until at
         least 2031; additional European patent granted for BL-1020, valid
         through June 2026

  *BL-8040 (Leukemia and other hematological cancers):

       *Signed a worldwide exclusive license agreement with Biokine
         Therapeutics Ltd., a Clal Biotechnology Industries (TASE: CBI)
         portfolio company, to develop and commercialize BL-8040
       *Phase IIa clinical studies for acute myeloid leukemia (AML) and acute
         lymphoblastic leukemia (ALL) expected to start in H1 2013

  *BL-8020 (Hepatitis C):

       *Successful completion of pre-clinical development for BL-8020, an
         oral, interferon-free treatment for Hepatitis C
       *Phase I/II clinical study expected to commence in Q1 2013

  *BL-7010 (Celiac disease):

       *New pre-clinical results, demonstrating the safety of BL-7010, an
         oral treatment for celiac disease and gluten sensitivity, were
         presented at a leading European celiac conference
       *Efficacy results published in Gastroenterology, a leading medical
         magazine

Kinneret Savitsky, Ph.D., CEO of BioLineRx, remarked, “We are pleased with the
progress achieved in our portfolio during the third quarter with respect to
our clinical and pre-clinical therapeutic compounds. With regard to our
leading compound, BL-1020 for schizophrenia, we are especially excited by the
recent re-analysis of the Phase IIb EAGLE study by an outside group of leading
scientists. According to the re-analysis, when taking into account the effects
of the circadian rhythm (i.e., 24-hour time cycle), BL-1020 is significantly
more effective in improving cognitive function than previously discovered. The
ramifications of this re-analysis have been taken into account in the
execution of the on-going CLARITY Phase II/III trial for BL-1020, and these
findings, along with other analyses we have previously performed, have
motivated us to initiate an interim analysis of the short-term cognitive
effects of BL-1020 within the CLARITY trial. We are hopeful the interim
analysis will reinforce our confidence regarding the cognitive benefits of
BL-1020, and potentially accelerate our commercialization efforts for the
further development of this promising therapeutic candidate.”

Dr. Savitsky added, “Following our strategic decision to enter the field of
oncology, we were extremely fortunate during the quarter to in-license
BL-8040, a promising Phase II ready drug for the treatment of acute myeloid
leukemia (AML), acute lymphoblastic leukemia (ALL), as well as other types of
hematological cancers. Since AML and ALL are recognized orphan indications, we
plan to seek orphan designation status from the regulatory authorities in
order to accelerate BL-8040’s development plan. In addition, based on
BL-8040’s positive pre-clinical data, as well as its mechanism of action, we
believe it can be utilized for several other related oncology indications. We
look forward to the upcoming Phase II clinical studies for evaluating
BL-8040’s efficacy on AML and ALL patients, which are expected to commence in
the first half of 2013. This compound has recently attracted the attention of
leading physicians and scientists at the MD Anderson Cancer Center in Houston,
Texas, one of the premier cancer centers in the world. We expect the MD
Anderson Cancer Center to be the lead site in the upcoming clinical studies.”

“An important milestone achieved during the third quarter was the successful
completion of the pre-clinical stage of development for BL-8020, an orally
available, interferon-free treatment for Hepatitis C. We are proud of the
speed and efficiency demonstrated in advancing BL-8020 to the clinical stage,
in light of the fact that we just in-licensed this compound during the first
quarter of this year. BL-8020 works on the host rather than directly on the
virus itself, which suggests pan-genotypic efficacy and the ability to be
combined with different drug groups. These two characteristics make BL-8020
attractive as an adjunct therapy to other oral cocktail therapies, therefore
not directly competing with the crowded HCV market of currently approved
therapies or those under development. We look forward to commencing a Phase
I/II clinical study for this promising drug at the beginning of 2013,” stated
Dr. Savitsky.

Dr. Savitsky concluded, “So far, 2012 has been a year of substantial
achievement for BioLineRx. We have enjoyed increased awareness among the
investment community as two analysts have initiated coverage of the Company.
Additionally, we made significant progress on multiple fronts, many of which
are expected to come to key value inflection points in the near future. The
coming months are expected to be eventful, as we receive the interim results
of BL-1020’s CLARITY Phase II/III trial, results of the Phase II clinical
trial of BL-7040 for the treatment of inflammatory bowel disease, as well as
commence clinical trials for BL-8020 for the treatment of HCV, and BL-8040 for
the treatment of leukemia. We have had a busy and productive quarter and
believe these critical milestones showcase the strength of our business model
and the competence of our highly experienced team.”

Financial Results for Three Months and Nine Months Ending September 30, 2012

During the three and nine months ended September 30, 2012 and 2011, no
revenues were recorded.

Research and development expenses for the quarter ended September 30, 2012
were NIS 15.8 million ($4.1 million), an increase of NIS 2.6 million ($0.7
million), or 20%, compared to NIS 13.2 million ($3.4 million) for the quarter
ended September 30, 2011. The increase resulted primarily from higher expenses
in 2012 associated with the CLARITY clinical trial in respect of BL-1020,
which commenced at the end of June 2011 and was still in its initial stages
during the third quarter of 2011. Research and development expenses for the
nine months ended September 30, 2012 were NIS 46.5 million ($11.9 million), an
increase of NIS 16.5 million ($4.2 million), or 55%, compared to NIS 30.0
million ($7.7 million) for the nine months ended September 30, 2011. The
increase resulted primarily from higher expenses in 2012 associated with the
CLARITY clinical, as mentioned above in the three-month comparison, as well as
a ramp-up in spending on several new projects introduced during the second
half of 2011 and the first nine months of 2012.

Sales and marketing expenses for the quarter ended September 30, 2012 were NIS
0.9 million ($0.2 million), an increase of NIS 0.5 million ($0.1 million), or
155%, compared to NIS 0.4 million ($0.1 million) for the quarter ended
September 30, 2011. The increase relates to professional fees and other
expenses stemming from a significant increase in our business development
efforts, compared to the third quarter of last year. Sales and marketing
expenses for the nine months ended September 30, 2012 were NIS 2.6 million
($0.7 million), an increase of NIS 0.2 million ($0.1 million), or 8%, compared
to NIS 2.4 million ($0.6 million) for the nine months ended September 30,
2011. The increase relates to a significant increase in our business
development efforts over the last year, offset by savings resulting primarily
from efficiencies realized this year due to the reorganization of our business
development team, as well as professional services incurred in the nine-month
period last year related to the reacquisition of the rights to BL-1020 from
Cypress Bioscience.

General and administrative expenses for the quarter ended September 30, 2012
were NIS 2.8 million ($0.7 million), a decrease of NIS 0.4 million ($0.1
million), or 13%, compared to NIS 3.2 million ($0.8 million) for the quarter
ended September 30, 2011. The decrease resulted primarily from a one-time
expense for professional services incurred in the three-month period last year
associated with the Company’s initial listing on NASDAQ in July 2011. General
and administrative expenses for the nine months ended September 30, 2012 were
NIS 9.3 million ($2.4 million), a decrease of NIS 0.2 million ($0.1 million),
or 2%, compared to NIS 9.5 million ($2.5 million) for the nine months ended
September 30, 2011. The reasons for the decrease are similar to those
discussed above in the three-month comparison, partially offset by an increase
in investor relations efforts made during the 2012 period.

The Company’s operating loss for the quarter ended September 30, 2012 amounted
to NIS 19.6 million ($5.0 million), compared with an operating loss of NIS
16.9 million ($4.3 million) for the quarter ended September 30, 2011. The
Company’s operating loss for the nine months ended September 30, 2012 amounted
to NIS 58.5 million ($14.9 million), compared with an operating loss of NIS
42.0 million ($10.7 million) for the comparable period in 2011.

Non-operating expenses for the quarter ended September 30, 2012 primarily
result from a NIS 1.2 million ($0.3 million) fair-value adjustment of
derivative liabilities on account of the warrants issued in the private
placement which we conducted in February 2012, as well as initial commitment
and finder’s fees in the aggregate amount of NIS 2.0 million ($0.5 million)
relating to the share purchase agreement with LPC signed in September 2012.
Non-operating income for the nine months ended September 30, 2012 primarily
results from a NIS 5.5 million ($1.4 million) fair-value adjustment of
derivative liabilities on account of the warrants issued in the private
placement which we conducted in February 2012, offset by issuance expenses in
the amount of NIS 1.2 million ($0.3 million) from the private placement
related to the warrants, as well as the initial commitment and finder’s fees
mentioned in the three-month comparison above.

Net financial income was NIS 0.2 million ($0.1 million) for the quarter ended
September 30, 2012, a change of NIS 8.8 million ($2.2 million), compared to
net financial income of NIS 8.9 million ($2.3 million) for the quarter ended
September 30, 2011. Net financial income for the quarter ended September 30,
2011 results primarily from a significant increase in the average exchange
rate of the dollar in relation to the NIS during the period, which had a
positive effect on net assets denominated in dollars. Net financial income was
NIS 4.3 million ($1.1 million) for the nine months ended September 30, 2012, a
change of NIS 1.7 million ($0.4 million), compared to net financial income of
NIS 6.0 million ($1.5 million) for the nine months ended September 30, 2011.
Net financial income for both nine-month periods result primarily from
increases in the average exchange rate of the dollar in relation to the NIS,
which had a positive effect on net assets denominated in dollars.

Net loss for the quarter ended September 30, 2012 amounted to NIS 22.6 million
($5.8 million), compared with a net loss of NIS 7.9 million ($2.0 million) for
the quarter ended September 30, 2011. Net loss for the nine months ended
September 30, 2012 amounted to NIS 51.8 million ($13.3 million), compared with
a net loss of NIS 36.0 million ($9.2 million) for the comparable period in
2011.

As of September 30, 2012, BioLineRx had NIS 101.1 million ($25.9 million) in
cash, cash equivalents and short-term bank deposits, compared with NIS 98.8
million ($25.2 million) as of December 31, 2011. The increase in cash, cash
equivalents and short-term deposits is mainly due to the private placement
completed in February 2012, less cash outflows for the Company’s operating
activities during the period.

Net cash used in operating activities was NIS 52.6 million ($13.4 million) for
the nine months ended September 30, 2012, compared with net cash used in
operating activities of NIS 26.9 million ($6.9 million) for the nine months
ended September 30, 2011. The NIS 25.7 million ($6.5 million) increase in net
cash used in operating activities during the nine-month period in 2012,
compared to the nine-month period in 2011, was primarily the result of
increased research and development spending.

Net cash provided by investing activities for the nine months ended September
30, 2012 was NIS 15.2 million ($3.9 million), compared to net cash used in
investing activities of NIS 50.7 million ($13.0 million) for the nine months
ended September 30, 2011. The cash flows provided by investing activities in
the 2012 period relate primarily to a net decrease in the amount of short-term
bank deposits during the period. The cash flows used in investing activities
in the 2011 period relate primarily to a net increase in the amount of
short-term bank deposits during the period.

Net cash provided by financing activities for the nine months ended September
30, 2012 was NIS 52.2 million ($13.4 million), compared to an insignificant
amount of net cash used in financing activities for the nine months ended
September 30, 2011. This increase relates to the private placement completed
in February 2012.

Conference Call and Webcast Information

BioLineRx will hold a conference call to discuss its third quarter 2012
results today, November 14, 2012, at 9:00 a.m. EST. To access the conference
call, please dial 1-888-407-2553 from the U.S. or +972-3-918-0610
internationally. The call will also be available via live webcast through
BioLineRx’s website. A replay of the conference call will be available
approximately two hours after completion of the live conference call. To
access the replay, please dial 1-877-456-0009 from the U.S. or +972-3-9255925
internationally. The replay will be available through November 17, 2012.

(Tables follow)

About BioLineRx

BioLineRx is a publicly-traded biopharmaceutical development company.
BioLineRx is dedicated to building a portfolio of products for unmet medical
needs or with advantages over currently available therapies. BioLineRx’s
current portfolio consists of six clinical stage candidates: BL-1020 for
schizophrenia is currently undergoing a Phase II/III study; BL-1040, for
prevention of pathological cardiac remodeling following a myocardial
infarction, which has been out-licensed to Ikaria Inc., is currently
undergoing a pivotal CE-Mark registration trial; BL-5010 for non-surgical
removal of skin lesions has completed a Phase I/II study; BL-1021 for
neuropathic pain is in Phase I development, BL-7040 for treating inflammatory
bowel disease (IBD) is currently undergoing a Phase II trial, and BL-8040 for
treating acute myeloid leukemia (AML) and other hematological cancers has
completed Phase I. In addition, BioLineRx has eight products in various
pre-clinical development stages for a variety of indications, including
central nervous system diseases, infectious diseases, cardiovascular and
autoimmune diseases.

BioLineRx’s business model is based on acquiring molecules mainly from
biotechnological incubators and academic institutions. The Company performs
feasibility assessment studies and development through pre-clinical and
clinical stages, with partial funding from the Israeli Government’s Office of
the Chief Scientist (OCS). The final stage includes partnering with medium and
large pharmaceutical companies for advanced clinical development (Phase 3) and
commercialization. For more information on BioLineRx, please visit 
www.biolinerx.com.

Various statements in this release concerning BioLineRx’s future expectations,
plans and prospects, constitute “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements include words such as “may,” “expects,” “anticipates,” “believes,”
and “intends,” and describe opinions about future events. These
forward-looking statements involve known and unknown risks and uncertainties
that may cause the actual results, performance or achievements of BioLineRx to
be materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Some of these risks
are: changes in relationships with collaborators; the impact of competitive
products and technological changes; risks relating to the development of new
products; and the ability to implement technological improvements. These and
other factors are more fully discussed in the “Risk Factors” section of
BioLineRx’s Form 20-F filed with the Securities and Exchange Commission on
March 22, 2012. In addition, any forward-looking statements represent
BioLineRx’s views only as of the date of this release and should not be relied
upon as representing its views as of any subsequent date. BioLineRx does not
assume any obligation to update any forward-looking statements unless required
by law.

BioLineRx Ltd.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION
(UNAUDITED)

                                                              Convenience
                                                        translation into
                                                              USD (Note 1b)
                           December 31,     September 30,     September 30,
                           2011             2012              2012
                           NIS in thousands                   In thousands
Assets
CURRENT ASSETS
Cash and cash              33,061           52,898            13,522
equivalents
Short-term bank            65,782           48,247            12,333
deposits
Prepaid expenses           687              505               129
Other receivables          3,825           1,814            464         
Total current assets       103,355         103,464          26,448      
                                                              
NON-CURRENT ASSETS
Restricted deposits        2,746            2,777             710
Long-term prepaid          204              221               56
expenses
Property and               4,211            3,420             875
equipment, net
Intangible assets, net     1,144           1,060            271         
Total non-current          8,305           7,478            1,912       
assets
Total assets               111,660         110,942          28,360      
                                                              
Liabilities and equity
CURRENT LIABILITIES
Current maturities of      307              172               44
long-term bank loan
Accounts payable and
accruals:
Trade                      11,275           11,689            2,988
OCS                        6,233            6,427             1,643
Other                      7,894           8,168            2,088       
Total current              25,709          26,456           6,763       
liabilities
                                                              
NON-CURRENT
LIABILITIES
Long-term bank loan,
net of current             110              -                 -
maturities
Retirement benefit         83               83                21
obligations
Derivative liability       -               12,462           3,186       
on account of warrants
Total non-current          193             12,545           3,207       
liabilities
COMMITMENTS AND
CONTINGENT LIABILITIES
Total liabilities          25,902          39,001           9,970       
                                                              
EQUITY
Ordinary shares            1,236            1,760             450
Share premium              421,274          457,085           116,842
Capital reserve            31,317           33,007            8,437
Accumulated deficit        (368,069  )      (419,911   )      (107,339    )
Total equity               85,758          71,941           18,390      
Total liabilities and      111,660         110,942          28,360      
equity
                                                                          
                                                                          

BioLineRx Ltd.
CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE LOSS
(UNAUDITED)
                                                                    
                                                                           Convenience translation
                                                                         into USD
                                                                           (Note 1b)
                                                                           Three       Nine
                                                                           months        months
                   Three months ended          Nine months ended           ended         ended
                   September 30,               September 30,               September     September
                                                                           30,           30,
                   2011        2012          2011        2012          2012          2012
                   NIS in thousands                                        In thousands
RESEARCH AND
DEVELOPMENT        (13,255 )     (15,848 )     (30,044 )     (46,523 )     (4,051  )     (11,892 )
EXPENSES, NET
SALES AND
MARKETING          (358    )     (912    )     (2,431  )     (2,626  )     (233    )     (671    )
EXPENSES
GENERAL AND
ADMINISTRATIVE     (3,272  )     (2,834  )     (9,546  )     (9,315  )     (724    )     (2,381  )
EXPENSES
OPERATING LOSS     (16,885 )     (19,594 )     (42,021 )     (58,464 )     (5,008  )     (14,944 )
NON-OPERATING
INCOME             -             (3,180  )     -             2,351         (813    )     601
(EXPENSES),
NET
FINANCIAL          8,965         1,827         10,785        8,323         467           2,127
INCOME
FINANCIAL          (18     )     (1,649  )     (4,750  )     (4,052  )     (422    )     (1,036  )
EXPENSES
COMPREHENSIVE
LOSS FOR THE       (7,938  )     (22,596 )     (35,986 )     (51,842 )     (5,776  )     (13,252 )
PERIOD
                                                                                         
                   NIS                                                     USD
                                                                                         
LOSS PER
ORDINARY SHARE     (0.06   )     (0.15   )     (0.29   )     (0.34   )     (0.04   )     (0.09   )
- BASIC
                                                                                                 
                                                                                                 

BioLineRx Ltd.
CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENTS
(UNAUDITED)

                                                             Convenience
                                                         translation
                                                             into USD
                                                             (Note 1b)
                                 Nine months ended           Nine months ended
                                 September 30,               September 30,
                                 2011        2012          2012
                                 NIS in thousands            In thousands
                                                                         
CASH FLOWS - OPERATING
ACTIVITIES
Comprehensive loss for the       (35,986 )     (51,842 )     (13,252     )
period
Adjustments required to
reflect net cash used in         9,092        (724    )     (184        )
operating activities (see
appendix below)
Net cash used in operating       (26,894 )     (52,566 )     (13,436     )
activities
                                                                         
                                                                         
CASH FLOWS - INVESTING
ACTIVITIES
Investments in short-term        (76,351 )     (48,992 )     (12,524     )
deposits
Investments in restricted        (1,000  )     -             -
deposits
Maturities of short-term         27,463        64,801        16,565
deposits
Purchase of property and         (716    )     (545    )     (139        )
equipment
Purchase of intangible           (131    )     (21     )     (6          )
assets
Net cash provided by (used       (50,735 )     15,243       3,896       
in) investing activities
                                                                         
                                                                         
CASH FLOWS - FINANCING
ACTIVITIES
Repayments of bank loan          (230    )     (224    )     (57         )
Issuance of share capital
and warrants, net of             -             52,453        13,408
issuance expenses
Proceeds from exercise of        1            *            *           
employee stock options
Net cash provided by (used       (229    )     52,229       13,351      
in) financing activities
                                                                         
INCREASE (DECREASE) IN CASH      (77,858 )     14,906        3,811
AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS –      111,746       33,061        8,451
BEGINNING OF PERIOD
EXCHANGE DIFFERENCES ON CASH     7            4,931        1,260       
AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS -      33,895       52,898       13,522      
END OF PERIOD
                                                                         
* Less than 1,000

                                                                         

BioLineRx Ltd.
APPENDIX TO CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENTS
(UNAUDITED)
                                                            
                                                                 Convenience
                                                                 translation
                                                                 into USD
                                                                 (Note 1b)
                                       Nine months ended         Nine months
                                       September 30,             ended
                                                                 September 30,
                                       2011       2012         2012
                                       NIS in thousands          In thousands
                                                                 
                                                                 
Adjustments required to reflect
net cash used in operating
activities:
Income and expenses not involving
cash flows:
Depreciation and amortization          1,170        1,188        303
Impairment of intangible assets        80           -            -
Long-term prepaid expenses             1            (17    )     (4        )
Exchange differences on cash and       (7     )     (4,931 )     (1,260    )
cash equivalents
Share-based compensation               2,744        2,358        603
Warrant issuance costs                 -            1,204        308
Gain on adjustment of warrants to      -            (5,528 )     (1,413    )
fair value
Interest and exchange differences      (1,639 )     1,726        441
on short-term deposits
Interest and linkage on bank loan      (11    )     (21    )     (5        )
Interest and exchange differences      13          (31    )     (8        )
on restricted deposits
                                       2,351       (4,052 )     (1,035    )
                                                                 
Changes in operating asset and
liability items:
Decrease in trade accounts             3,929        2,193        561
receivable and other receivables
Increase in accounts payable and       2,812       1,135       290       
accruals
                                       6,741       3,328       851       
                                       9,092       (724   )     (184      )
                                                                 
                                                                 
Supplementary information on           1,334       1,439       368       
interest received in cash
                                                                           
* Less than 1,000

Contact:

KCSA Strategic Communications
Garth Russell, 1-212-896-1250
grussell@kcsa.com
or
Todd Fromer, 1-212-896-1215
tfromer@kcsa.com
or
Tsipi Haitovsky, Public Relations
+972-3-6240871
tsipih@netvision.net.il
 
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