Fennec Pharmaceuticals Announces Fiscal Year 2021 Financial Results And Provides Business Update
~ Resubmission of NDA for PEDMARK™ Targeted for the First Quarter of 2022 ~
~ Company has Approximately $21.1 Million in Cash and $5 Million of Funded Debt ~
RESEARCH TRIANGLE PARK, N.C., Feb. 28, 2022 (GLOBE NEWSWIRE) -- Fennec Pharmaceuticals Inc. (NASDAQ:FENC; TSX: FRX), a specialty pharmaceutical company focused on the development of PEDMARK™ (a unique formulation of sodium thiosulfate (STS)) for the prevention of platinum-induced ototoxicity in pediatric patients, today reported its financial results for the fiscal year ended December 31, 2021 and provided a business update.
“We expect to resubmit the New Drug Application (NDA) for PEDMARK™ to the FDA during the first quarter of 2022,” said Rosty Raykov, chief executive officer of Fennec Pharmaceuticals. “We remain committed to making PEDMARK commercially available to children and young adults receiving cisplatin chemotherapy, who currently have no approved therapies for ototoxicity.”
Financial Results for the Fourth Quarter and Fiscal Year Ended December 31, 2021
Cash Position – There was a $9.2 million decrease in cash and cash equivalents between December 31, 2021 and December 31, 2020. The net decrease was the result of cash operating expenses, offset by the $5.0 million received from the Bridge Bank Loan Security Agreement and some negligible amounts received from option exercises. During the period ended December 31, 2021, cash for operations was used mainly on pre-commercialization activities for PEDMARK and regulatory submission activities relating to the pending resubmission of the NDA.
Research and Development (R&D) Expenses – R&D expenses were $0.5 and $5.0 million, respectively, for the fourth quarter and year ended December 31, 2021, compared to $1.2 million and $5.1 million for the same period in 2020.
General and Administrative (G&A) Expenses – G&A expenses were $3.7 million and $12.2 million, respectively, for the fourth quarter and year ended December 31, 2021, compared to $2.3 million and $13.0 million, respectively for the same periods in 2020. The annual decrease in G&A was largely due to commercialization readiness expenses for PEDMARK in 2020, which did not need to be repeated in 2021. The fourth quarter increase in 2021 over the same time period in 2020 arose from non-cash equity grants and our pre-commercialization activities for PEDMARK as the Company prepared for potential NDA approval by the FDA in November 2021.
Net Loss - Net losses for the fourth quarter and year ended December 31, 2021 of $4.4 million ($0.18 per share) and $17.3 million ($0.67 per share), respectively, compared to $3.2 million ($0.13 per share) and $18.1 million ($0.76 per share), respectively, for the same periods in 2020.
Financial Guidance – The Company believes its cash and cash equivalents on hand as of December 31, 2021 will be sufficient to fund the Company's planned activities for 2022 including NDA resubmission and commercial readiness activities.
Financial Update
The selected financial data presented below is derived from our audited, condensed consolidated financial statements, which were prepared in accordance with U.S. generally accepted accounting principles. The complete audited, condensed consolidated financial statements for the period ended December 31, 2021, and management's discussion and analysis of financial condition and results of operations, will be available via www.sec.gov and www.sedar.com. All values are presented in thousands unless otherwise noted.
Audited Condensed Consolidated
Statement of Operations:
(U.S. Dollars in thousands except per share amounts)
Three Months Ended | Twelve Months Ended | ||||||||||||||
December 31, | December 31, | December 31, | December 31, | ||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||
Revenue | $ | — | $ | 170 | $ | — | $ | 170 | |||||||
Operating expenses: | |||||||||||||||
Research and development | 523 | 1,223 | 4,981 | 5,105 | |||||||||||
General and administrative | 3,684 | 2,293 | 12,242 | 12,950 | |||||||||||
Total operating expense | 4,207 | 3,516 | 17,223 | 18,055 | |||||||||||
Loss from operations | (4,207 | ) | (3,346 | ) | (17,223 | ) | (17,885 | ) | |||||||
Other (expense)/income | |||||||||||||||
Amortization expense | (8 | ) | — | (16 | ) | (402 | ) | ||||||||
Unrealized (loss)/gain on securities | (162 | ) | 100 | (25 | ) | 100 | |||||||||
Other loss | (63 | ) | (5 | ) | (136 | ) | (9 | ) | |||||||
Interest income | 13 | 13 | 54 | 87 | |||||||||||
Total other (expense)/income, net | (220 | ) | 108 | (123 | ) | (224 | ) | ||||||||
Net loss | $ | (4,427 | ) | $ | (3,238 | ) | $ | (17,346 | ) | $ | (18,109 | ) | |||
Basic net loss per common share | $ | (0.18 | ) | $ | (0.13 | ) | $ | (0.67 | ) | $ | (0.76 | ) | |||
Diluted net loss per common share | $ | (0.18 | ) | $ | (0.13 | ) | $ | (0.67 | ) | $ | (0.76 | ) | |||
Audited Condensed Consolidated Balance Sheets
(U.S. Dollars in thousands)
December 31, 2021 | December 31, 2020 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 21,100 | $ | 30,344 | |||
Other current assets | 1,287 | 1,073 | |||||
Non-current assets, net | 27 | — | |||||
Total Assets | $ | 22,414 | $ | 31,417 | |||
Liabilities and stockholders’ equity | |||||||
Current liabilities | $ | 1,654 | $ | 2,347 | |||
Non-current liabilities, net | 4,988 | — | |||||
Total stockholders’ equity | 15,772 | 29,070 | |||||
Total liabilities and stockholders’ equity | $ | 22,414 | $ | 31,417 | |||
Working Capital | Fiscal Year Ended | |||||||
Selected Asset and Liability Data: | December 31, 2021 | December 31, 2020 | ||||||
(U.S. Dollars in thousands) | ||||||||
Cash and cash equivalents | $ | 21,100 | $ | 30,344 | ||||
Other current assets | 1,287 | 1,073 | ||||||
Current liabilities excluding derivative liability | (1,654 | ) | (2,347 | ) | ||||
Working capital | $ | 20,733 | $ | 29,070 | ||||
Selected Equity: | ||||||||
Common stock & APIC | $ | 194,015 | $ | 189,967 | ||||
Accumulated deficit | (179,486 | ) | (162,140 | ) | ||||
Stockholders’ equity | 15,772 | 29,070 | ||||||
About PEDMARK™
Cisplatin and other platinum compounds are essential chemotherapeutic agents for many pediatric malignancies. Unfortunately, platinum-based therapies cause ototoxicity, or hearing loss, which is permanent, irreversible and particularly harmful to the survivors of pediatric cancer.
In the U.S. and Europe, it is estimated that, annually, over 10,000 children may receive platinum-based chemotherapy. The incidence of ototoxicity depends upon the dose and duration of chemotherapy, and many of these children require lifelong hearing aids. There is currently no established preventive agent for this hearing loss and only expensive, technically difficult and sub-optimal cochlear (inner ear) implants have been shown to provide some benefit. Infants and young children that suffer ototoxicity at critical stages of development lack speech language development and literacy, and older children and adolescents lack social-emotional development and educational achievement.
PEDMARK has been studied by cooperative groups in two Phase 3 clinical studies of survival and reduction of ototoxicity, The Clinical Oncology Group Protocol ACCL0431 and SIOPEL 6. Both studies have been completed. The COG ACCL0431 protocol enrolled childhood cancers typically treated with intensive cisplatin therapy for localized and disseminated disease, including newly diagnosed hepatoblastoma, germ cell tumor, osteosarcoma, neuroblastoma, and medulloblastoma. SIOPEL 6 enrolled only hepatoblastoma patients with localized tumors.
The Marketing Authorization Application (MAA) for sodium thiosulfate (tradename PEDMARQSI) is currently under evaluation by the European Medicines Agency (EMA). PEDMARK has received Breakthrough Therapy and Fast Track Designation by the FDA in March 2018.
About Fennec Pharmaceuticals
Fennec Pharmaceuticals Inc. is a specialty pharmaceutical company focused on the development of PEDMARK™ for the prevention of platinum-induced ototoxicity in pediatric patients. Further, PEDMARK has received Orphan Drug Designation in the U.S. for this potential use. Fennec has a license agreement with Oregon Health and Science University (OHSU) for exclusive worldwide license rights to intellectual property directed to sodium thiosulfate and its use for chemoprotection, including the prevention of ototoxicity induced by platinum chemotherapy, in humans. For more information, please visit www.fennecpharma.com
Forward Looking Statements
Except for historical information described in this press release, all other statements are forward-looking. Words such as “believe,” “anticipate,” “plan,” “expect,” “estimate,” “intend,” “may,” “will,” or the negative of those terms, and similar expressions, are intended to identify forward-looking statements. These forward-looking statements include the Company’s expectations regarding its interactions and communications with the FDA, including the Company’s expectations and goals respecting the resolution the issues raised in the CRL and the Company’s plans to address them, and the anticipated timing of the Company’s finalization and filing of an NDA resubmission for PEDMARK. Forward-looking statements are subject to certain risks and uncertainties inherent in the Company’s business that could cause actual results to vary, including such risks and uncertainties relating to the Company’s reliance on third party manufacturing, the risk that unforeseen factors may delay the resubmission of the NDA, the risks of delays in or failure to obtain FDA approval of PEDMARK, the risks relating to the Company’s and its manufacturer’s ability to adequately address the concerns identified in the CRL, the risk that the resubmission of the NDA to the FDA will not be satisfactory, that regulatory and guideline developments may change, scientific data and/or manufacturing capabilities may not be sufficient to meet regulatory standards or receipt of required regulatory clearances or approvals, clinical results may not be replicated in actual patient settings, unforeseen global instability, including political instability, or instability from an outbreak of pandemic or contagious disease, such as the novel coronavirus (COVID-19), or surrounding the duration and severity of an outbreak, protection offered by the Company’s patents and patent applications may be challenged, invalidated or circumvented by its competitors, the available market for the Company’s products will not be as large as expected, the Company’s products will not be able to penetrate one or more targeted markets, revenues will not be sufficient to fund further development and clinical studies, the Company may not meet its future capital requirements in different countries and municipalities, and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission including its Annual Report on Form 10-K for the year ended December 31, 2021. Fennec disclaims any obligation to update these forward-looking statements except as required by law.
For a more detailed discussion of related risk factors, please refer to our public filings available at www.sec.gov and www.sedar.com.
For further information, please contact:
Investors:
Robert Andrade
Chief Financial Officer
Fennec Pharmaceuticals Inc.
(919) 246-5299
Media:
Elixir Health Public Relations
Lindsay Rocco
(862) 596-1304
lrocco@elixirhealthpr.com
