VANCOUVER, BRITISH COLUMBIA--(Marketwired - Apr 30, 2014) - Med BioGene Inc. (TSX VENTURE:MBI) today reported its financial results for the year ended December 31, 2013 (all amounts are in United States dollars).
2013 and Q1 2014 Business Highlights:
- MBI's commercial partner, Precision Therapeutics, received regulatory approval of GeneFx® Lung under CLIA (Clinical Laboratory Improvement Amendments of 1988), the United States federal regulations applicable to clinical laboratory testing. With this approval, Precision may undertake testing of GeneFx Lung in its CLIA-certified clinical laboratory in Pittsburgh, Pennsylvania.
- MBI's clinical partner, Princess Margaret Cancer Centre, University Health Network (UHN) in Toronto, published in the Journal of Thoracic Oncology data demonstrating a second, independent validation, conducted in a prospective and blinded manner, of GeneFx Lung.
- Precision and UHN presented at the American Society of Clinical Oncology (ASCO) Annual Meeting in Chicago, Illinois, data detailing successful completion of clinical studies to validate the use of GeneFx Lung with tissue preserved by RNAlater®, a molecular fixative.
- Pursuant to a settlement agreement among MBI, Precision, Signal Genetics LLC and Respira Health LLC, Signal and Respira dismissed and withdrew with prejudice their legal claims made against MBI and Precision in the Supreme Court of the State of New York. As part of MBI and Precision's commercialization agreement, Precision is solely responsible for all financial obligations under the settlement agreement.
- MBI successfully opposed a petition filed in the British Columbia Supreme Court by MBI shareholders Iain Weir-Jones, Elizabeth Anne Weir-Jones, Graeme May and Tracy May relating to MBI's adoption of an Advance Notice Policy. The dissident shareholders discontinued the petition.
- 2,318,000 warrants and agents' warrants to purchase an equal number of common shares of MBI at a price of $0.10 per share were exercised for gross proceeds to MBI of C$231,800.
Erinn B. Broshko, MBI's Executive Chairman, commented: "2013 and the beginning of 2014 has seen Med BioGene achieve some very important milestones leading up to the commercialization of GeneFx Lung.
"As we have previously noted to our shareholders, the long-term commercial success of GeneFx Lung will depend largely upon the extent to which government payors, specifically Medicare, and other third-party payors reimburse the test. Precision is developing their launch strategy to maximize reimbursement opportunities in light of payor precedent and feedback from Medicare. The timing of the commercial launch of GeneFx Lung will be established by Precision in view of these considerations and we will update our shareholders once a decision has been made."
2013 Financial Results
During the year ended December 31, 2013, MBI recorded a net loss of $759,288 (2012 - $368,083), which consists of general and administrative expenses of $401,583 (2012 - $263,549) and non-cash, share based payments of $357,705 (2012 - $104,534). During the year, MBI granted 3,050,000 stock options with a fair value of $357,705 and expensed it to operations.
The increase in general and administrative expenses during the year ended December 31, 2013 were due largely to MBI incurring $125,826 of legal fees relating to MBI's successful opposition of the above-mentioned petition filed in the British Columbia Supreme Court on June 4, 2013 by dissident shareholders of MBI..
During the three months ended December 31, 2013 and 2012, including non-cash, share-based payments relating to the prior issuance of stock options, MBI incurred a loss of $67,320 ($0.00 per share) and a loss of $66,239, respectively.
Liquidity and Capital Resources
At December 31, 2013, MBI had cash and equivalents totalling $181,507 and working capital of $112,624 compared to cash and equivalents of $355,326 and a working capital of $294,655 at December 31, 2012.
Cash used in operating activities was $398,294 for the year ended December 31, 2013 compared to $329,549 for the year ended December 31, 2012.
Cash provided by financing activities was $225,792 for the year ended December 31, 2013 compared to $nil for the year ended December 31, 2012. In May 2013, 2,318,000 warrants and agents' warrants to purchase an equal number of common shares of MBI at a price of C$0.10 per share were exercised for gross proceeds to MBI of C$231,800.
Under MBI and Precision's commercialization agreement, MBI is eligible to receive from Precision up to $1.0 million in the following milestone payments, all of which are credited against future royalties that may be owed to MBI by Precision: following the commercial launch of GeneFx Lung, amounts totaling $500,000 and, following the achievement of $5 million in net revenues from GeneFx Lung, amounts totaling $500,000.
As a result of MBI's current cash position, management has decreased their compensation to provide an extended runway to the anticipated commercialization of GeneFx Lung and receipt from Precision of the $500,000 milestone payment noted above.
About Med BioGene Inc.
MBI is a life science company based in Vancouver, British Columbia that is currently focused on managing the license and rights to GeneFx Lung. MBI's common shares are listed for trading on the TSX Venture Exchange. For more information, please visit www.medbiogene.com.
About GeneFx Lung
GeneFx Lung is a proprietary gene expression-based test to improve upon staging for identifying those patients with early-stage non-small-cell lung cancer (NSCLC) who, following surgical removal of their tumor, are at higher and lower risks of mortality. In an initial study of patient specimens from the National Cancer Institute of Canada Clinical Trials Group JBR.10 trial, published in the Journal of Clinical Oncology, patients classified by GeneFx Lung as high risk benefited from adjuvant chemotherapy, and those classified as low risk did not benefit and may have experienced a detrimental effect from adjuvant chemotherapy. In the same study, GeneFx Lung was validated in predicting patient mortality in four independent studies involving data from tumor specimens totaling 375 untreated early-stage NSCLC patients. As published in the Journal of Thoracic Oncology, GeneFx Lung was also independently validated in a prospective and blinded manner in predicting patient mortality in a study of 181 specimens from untreated NSCLC patients. GeneFx Lung is expected to provide better-informed and personalized treatment decisions to assist in the selection of patients for adjuvant chemotherapy.
On April 15, 2011, Precision and MBI closed their commercialization, license and research reimbursement agreement. The agreement provides to Precision exclusive global rights to develop and commercialize GeneFx Lung.
About Precision Therapeutics
Precision Therapeutics, a leading life science company based in Pittsburgh, Pennsylvania, is dedicated to improving the outcomes of cancer patients by providing personalized medicine solutions that aim to increase quality of life and cancer survival rates. Precision offers a portfolio of products developed to help guide physicians and patients with difficult clinical decisions throughout the continuum of cancer care.
Precision currently markets a number of tests through its CLIA-certified laboratory, including ChemoFx®, BioSpeciFx® and GeneFx® Colon.
For more information on Precision, please visit www.precisiontherapeutics.com.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
Certain information in this press release contains forward-looking information and statements ("forward-looking information") of MBI under applicable Canadian and United States legislation. Words such as "anticipates," "believes," "estimates," "expects," "intends," "may," "plans," "projects," "will," "would" and similar expressions are intended to identify forward-looking information, although not all forward-looking information contains these identifying words. Forward looking information includes, but is not limited to, that with respect to the timing, completion and/or results of clinical trials or studies, the timing for commercialization of any products, future profits, future product revenues, future shareholder value, future operations and plans, the completion and use of proceeds from transactions or financings and the prospects for negotiating partnerships or collaborations and their timing. This forward-looking information is only a prediction based upon MBI's current expectations, and actual events or results may differ materially. MBI may not actually achieve the plans, intentions or expectations disclosed in its forward-looking information. Forward-looking information is subject to known and unknown risks and uncertainties and is based upon uncertain assumptions that could cause MBI's actual results and the timing of events to differ materially from those anticipated in such forward-looking information. You are cautioned not to place undue reliance on this forward-looking information, which speak only as of the date of this press release. MBI's forward-looking information does not reflect the potential impact of any future partnerships, collaborations, acquisitions, mergers, dispositions, joint ventures or investments that MBI may make. All forward-looking information herein is qualified in its entirety by this cautionary statement and MBI undertakes no obligation to revise or update any such forward-looking information as a result of new information, future events or otherwise after the date of this press release, other than as required by applicable law. Certain information included in this press release in respect of Precision and its scientific, clinical and/ or commercialization efforts and expectations have been provided to MBI by Precision. MBI may not have been able to confirm the accuracy of such information and you should not place undue reliance on any such information, including any information regarding Precision that may constitute forward-looking information. A redacted copy of the commercialization agreement between MBI and Precision may be found at www.sedar.com. Each trademark, trade name or service mark of any entity appearing in this press release belongs to its holder.