MONTREAL, QUEBEC--(Marketwire - Nov 21, 2012) - MethylGene Inc. (MYG.TO) announced today it has completed its previously announced private placement of 179,690,970 units at a subscription price per unit of Cdn.$0.145 (the "Subscription Price"), each unit consisting of one common share and thirty one-hundredths (0.30) of a common share purchase warrant, exercisable until November 19, 2017 at an exercise price of Cdn.$0.174 (being 120% of the Subscription Price), for gross proceeds to MethylGene of approximately Cdn.$26.1 million.
The lead investor in the Offering was Tavistock Life Sciences, an insider of the Company, and other insiders participating in the Offering included funds managed by Baker Bros. Advisors, LLC, a fund managed by OrbiMed Advisors LLC, and Tang Capital Partners, LP. Other investors participating in the Offering included RA Capital Management and BVF Partners L.P.
"This funding represents the continuing commitment of our existing shareholders as well as a broadening of our shareholder base," said Dr. Charles Baum, President and Chief Executive Officer. "The net proceeds from the Offering will enable us to reach significant milestones in our two lead programs, MGCD265 and MGCD290, in 2013 and 2014."
MGCD265, a multi-targeted receptor kinase inhibitor for oncology, continues to progress and is expected to advance into multiple Phase I/II expansion cohorts upon reaching the Maximum Tolerated Dose (MTD). Indications of interest include renal cell, gastric, hepatocellular and non-small cell lung (NSCLC) cancers that express the c-Met target. Plans are underway to incorporate the novel target, Axl, into future studies. Axl is elevated in a number of cancer types, including NSCLC, where it is thought to play a role in resistance to EGFR inhibitors. Planning has also commenced for later stage randomized trials to evaluate MGCD265 in gastroesophageal cancer or NSCLC patients whose tumors express the c-Met target. Additional pilot studies may also be initiated in selected patient populations.
MGCD290, a novel antifungal agent targeting the fungal Hos2 enzyme, will complete enrollment in a randomized, double-blind, placebo-controlled Phase II study in patients with moderate-to-severe vulvovaginal candidiasis (VVC) this quarter and topline results from this trial will be reported in the first quarter of 2013. Planning is underway for continued development of this agent in VVC, and for expanded development in additional indications including systemic candidiasis.
With the proceeds from the Offering, and based on its current clinical development and operating plans, the Company''s cash runway is expected to extend into the second half of 2014.
Jefferies & Company, Inc. and MTS Securities, LLC acted as financial advisors to MethylGene for the Offering in the United States.
THE COMMON SHARES AND WARRANTS HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS ABSENT U.S. REGISTRATION OR AN APPLICABLE EXEMPTION FROM U.S. REGISTRATION REQUIREMENTS.
MGCD265 is a rationally designed, orally administered small molecule kinase inhibitor that targets the receptor tyrosine kinases (RTKs) Met, VEGFR 1,2,3 and Axl, as well as Tie2 and Ron. RTKs are key kinases involved in cancer, angiogenesis (a process whereby new blood vessels are formed to nourish the tumors), tumor cell metastasis, tumor development and survival. Met expression is elevated and associated with tumorigenesis in several solid tumor indications including NSCLC, gastric, prostate, colorectal, bladder, breast, renal, hepatocellular and ovarian cancers. Phase I/II studies of single agent MGCD265 and combinations with erlotinib or docetaxel are currently underway. More than 200 patients have been treated to date in clinical studies of both single-agent and combination therapy with docetaxel or erlotinib.
MGCD290 is a first-in-class, orally available, small molecule inhibitor of the fungal enzyme Hos2. In preclinical models the combination with azole antifungal agents results in broader coverage of fungal pathogens and decreases resistance to the most widely used antifungal agents. MGCD290 is being developed as a combination product with fluconazole, the most widely used triazole antifungal. In vitro, MGCD290 in combination with fluconazole reverses fluconazole resistance (primary and acquired) in a wide range of fungal species, including Candida glabrata. MGCD290 has completed multiple Phase I studies in healthy adult volunteers and has shown an excellent safety profile without drug-drug interactions in combination with fluconazole. A randomized, controlled Phase II study in moderate to severe VVC is underway.
MethylGene Inc. (MYG.TO) is a drug development company that is advancing novel therapeutics for cancer and infectious disease in human clinical trials. The Company''s lead product candidates are: MGCD290, an oral antifungal agent targeting the fungal Hos2 enzyme that is in Phase II trials for vulvovaginal candidiasis, and MGCD265, an oral multi-targeted receptor kinase inhibitor that is in Phase I/II clinical trials for patients with solid tumors. MethylGene owns all rights to its lead product candidates, and has partnerships with Otsuka Pharmaceutical Co. Ltd., Taiho Pharmaceutical Co. Ltd., and EnVivo Pharmaceuticals, Inc. for its other pipeline programs.
Certain statements contained in this news release, other than statements of fact that are independently verifiable at the date hereof, may constitute forward-looking statement. Such statements, based as they are on the current expectations of management of MethylGene, inherently involve numerous risks and uncertainties, known and unknown, many of which are beyond MethylGene''s control. These risks and uncertainties could cause future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Such results, performance or achievements include, but are not limited to, the timing and effects of regulatory action; the continuation of collaborations; the results of clinical trials; the timing of enrollment or completion of clinical trials; the success, efficacy or safety of MGCD265, MGCD290 or our other programs; the ability to scale up, formulate and manufacture sufficient GMP, clinical or commercialization quantities of MGCD265, MGCD290 or our other products, and the relative success or the lack of success in developing and gaining regulatory approval and/or market acceptance for any compound or new product including MGCD265 or MGCD290. Such risks include, but are not limited to, the impact of general economic conditions, economic conditions in the pharmaceutical industry, changes in the regulatory environment in the jurisdictions in which MethylGene does business, stock market volatility, fluctuations in costs, expectations with respect to our intellectual property position and our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others, changes in the competitive landscape including changes in the standard of care for the various indications in which MethylGene is involved, and changes to the competitive environment due to consolidation, as well as other risks, as described in MethylGene''s Annual Information Form under the heading "Risk Factors" which you are urged to read, and all other documents filed by the Company that can be found at www.sedar.com. Consequently, actual future results may differ materially from the anticipated results expressed in the forward-looking statements. The reader should not place undue reliance on the forward-looking statements included in this news release. These statements speak only as of the date they are made and MethylGene expressly disclaims any duty, obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in MethylGene''s expectations with regard thereto of any change in events, conditions or circumstances on which any such statements are based except in accordance with law.