AVEO Oncology Reports First Quarter 2015 Financial Results

CAMBRIDGE, Mass.--()--AVEO Oncology (NASDAQ:AVEO) today reported financial results for the first quarter ended March 31, 2015.

“Effective treatment of cancer associated cachexia by AV-380, a GDF15 inhibitory antibody”

“We continue to execute on our strategy of leveraging biomarker insights and exploring partnership opportunities to advance our pipeline, while continuing to streamline AVEO’s operations to align with our needs,” said Michael Bailey, president and chief executive officer. “In parallel, we are evaluating three potential approaches to create value with tivozanib: first, the submission of a Marketing Authorization Application (MAA) for renal cell cancer (RCC) in Europe; second, a prospective study in colorectal cancer (CRC) that leverages our recently presented neuropilin-1 biomarker data; and third, a confirmatory study in RCC to support US registration in first line RCC. We look forward to providing additional updates on our direction as we continue to engage with regulators and potential partners.”

Recent Highlights

  • Announced Presentation of AV-380 Preclinical Data in Cancer Associated Cachexia – In April, AVEO announced the presentation of results from a preclinical study of AV-380, the Company’s potent, humanized inhibitory antibody targeting growth differentiation factor 15 (GDF15), in a cachectic human tumor xenograft model with significantly increased plasma GDF15 levels. The data were presented in a poster titled “Effective treatment of cancer associated cachexia by AV-380, a GDF15 inhibitory antibody” at the 2015 Annual Meeting of the American Association of Cancer Research in Philadelphia.
  • Announced Presentation of Phase 2 Study Analysis Showing Longer PFS with Tivozanib versus Bevacizumab in Low Serum NRP-1 Patients with Advanced CRC – In March, AVEO announced the presentation of final results, including a predefined biomarker analysis of 162 patients with NRP-1 samples from the BATON-CRC study, a randomized Phase 2 clinical trial of modified FOLFOX6 combined with tivozanib or bevacizumab in CRC. The presentation, titled “Neuropilin-1 as a potential biomarker of progression-free survival benefit for tivozanib + mFOLFOX6 versus bevacizumab + mFOLFOX6 in metastatic colorectal cancer: post-hoc biomarker analysis of BATON-CRC Phase 2 trial,” was presented in a poster session at the American Association for Cancer Research (AACR) Tumor Angiogenesis and Vascular Normalization Conference in Orlando.
  • Received Confirmation of Eligibility for Submission of a MAA for Tivozanib in RCC to the European Medicines Agency and Announced Completion of Rapporteur Meetings – In January, AVEO announced that, in response to submission of a letter of intent, it has received written confirmation from the European Medicine Agency (EMA) that tivozanib is eligible for submission of an application for a European Union Marketing Authorization under the Agency’s centralized procedure. The Company announced today that, in late April 2015, its representatives met with the assigned Rapporteur and co-Rapporteur regarding the potential submission of a MAA for tivozanib for the treatment of RCC based on clinical trials conducted to date. The Company continues to evaluate the clinical, regulatory and economic feasibility of a submission to the EMA. Confirmation of eligibility for submission is not predictive of the EMA’s approval of a MAA.
  • Announced Several Key Executive Appointments – In January, AVEO announced that its board of directors appointed Michael P. Bailey as the Company’s president and chief executive officer and has elected Mr. Bailey as a director. Also in January, AVEO announced the appointment of Michael N. Needle, M.D., to the position of chief medical officer. In April, AVEO announced the appointment of Keith S. Ehrlich as the Company’s chief financial officer.
  • Announced Corporate Restructuring – In January, AVEO announced the elimination of its internal research function, as well as certain corporate support positions, to align its resources with the Company’s future strategic plans, focusing on advancement of its pipeline in the clinical setting and reducing corporate expenses. The Company expects to exit its current facility by the end of May 2015 with no further obligations to its landlord and to relocate to an appropriately-sized office facility in Cambridge, MA under flexible lease terms.

First Quarter 2015 Financial Highlights

  • AVEO ended Q1 2015 with $39.1 million in cash, cash equivalents and marketable securities.
  • Total collaboration revenue was approximately $0.1 million compared with $15.3 million for Q1 2014. The decrease was primarily due to an additional one-time recognition of $14.1 million of previously deferred revenue as a result of the modification of the Company’s arrangement with Biogen Idec in Q1 2014.
  • Research and development (R&D) expense was $2.7 million compared with $11.8 million for Q1 2014. The decrease in R&D expense was primarily due to a reduction in personnel-related expenses following AVEO’s January 2015 strategic restructuring, the reduction of its leased facilities as well as a decrease in external clinical trial and consulting costs associated with decreased tivozanib clinical development activity.
  • General and administrative (G&A) expense was $3.3 million compared with $5.6 million for Q1 2014. The decrease in G&A expense was primarily due to a reduction in external legal costs associated with various ongoing legal matters and a decrease in employee compensation, facilities and IT costs following the Company’s January 2015 restructuring and the reduction of its leased facilities.
  • Restructuring and lease exit expense was $4.3 million compared with $3.9 million for Q1 2014. The expense incurred during Q1 2014 relates to space that the Company ceased using during the quarter, while the Q1 2015 expenses relates to the elimination of its internal research function and the associated reduction in workforce in January 2015, which was substantially completed in March 2015.
  • Net loss for Q1 2015 was $10.9 million, or a loss of $0.21 per basic and diluted share compared with a net loss of $6.5 million or a loss of $0.12 per basic and diluted share for Q1 2014. The increase in the net loss is primarily driven by the additional one-time recognition of previously deferred revenue during Q1 2014, partially offset by the decrease in R&D and G&A expense.

Updated Financial Guidance

Based on its current operating plan, the Company expects its $39.1 million in cash resources as of March 31, 2015 will be sufficient to fund operations into the third quarter of 2016.

About AVEO

AVEO Oncology (AVEO) is a biopharmaceutical company committed to developing targeted therapies through biomarker-driven insights to provide improvements in patient outcomes where significant unmet medical needs exist. AVEO’s proprietary Human Response Platform™ has delivered unique insights into cancer and related disease biology that AVEO is seeking to leverage in the clinical development strategy of its therapeutic candidates. For more information, please visit the Company’s website at www.aveooncology.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements of AVEO within the meaning of The Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this press release are forward-looking statements. The words “anticipate,” “expect,” “intend,” “may,” “plan,” “could,” “should,” “seek,” or the negative of these terms or other similar expressions, are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements include, among others, statements about: AVEO’s plans and strategies to continue leveraging biomarker strategies and partnership opportunities to advance its pipeline and streamline its operations and AVEO’s intention to provide updates on third party discussions relating to the same. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that AVEO makes due to a number of important factors, including risks relating to: AVEO’s ability to successfully implement its restructuring and strategic plans; AVEO’s ability to successfully enroll and complete clinical trials of its product candidates; AVEO’s ability to demonstrate to the satisfaction of the FDA, EMA or other equivalent foreign regulatory agencies, the safety, efficacy and clinically meaningful benefit of its product candidates; AVEO’s ability to achieve and maintain compliance with all regulatory requirements applicable to its product candidates; AVEO’s ability to obtain and maintain adequate protection for intellectual property rights relating to its product candidates and technologies; developments and expenses related to AVEO’s ongoing shareholder litigation and SEC inquiry; AVEO’s ability to raise the substantial additional funds required to achieve its goals; unplanned capital requirements; adverse general economic and industry conditions; competitive factors; and those risks discussed in the section titled “Risk Factors” included in AVEO’s most recent Annual Report on Form 10-K, its quarterly reports on Form 10-Q and in its other filings with the SEC. The forward-looking statements in this press release represent AVEO’s views as of the date of this press release. AVEO anticipates that subsequent events and developments will cause its views to change. However, while AVEO may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so. You should, therefore, not rely on these forward-looking statements as representing AVEO’s views as of any date subsequent to the date of this press release.

 
AVEO Pharmaceuticals, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
   

For the Three Months

Ended March 31,
2015 2014
Collaboration revenue $ 134 $ 15,289
 
Operating expenses:
Research and development 2,695 11,767
General and administrative 3,255 5,555
Restructuring and lease exit   4,333     3,859  
10,283 21,181
 
Loss from operations (10,149 ) (5,892 )
 
Other income and expense:
Other (expense) income, net (14 ) 7
Interest expense (716 ) (581 )
Interest income   5     16  
Other expense, net (725 ) (558 )
 
Net loss   (10,874 ) $ (6,450 )
 
Net loss per share - basic and diluted $ (0.21 ) $ (0.12 )
 
Weighted average number of common shares outstanding   52,638     51,634  
 
 
AVEO Pharmaceuticals, Inc.
Consolidated Balance Sheet Data
(In thousands)
(Unaudited)
   
March 31, December 31,
2015 2014
 
Assets
Cash, cash equivalents and marketable securities $ 39,069 $ 52,306
Accounts receivable 947 2,341
Prepaid expenses and other current assets 4,400 4,481
Property and equipment, net 5,372 11,295
Other assets   213   239
 
Total assets $ 50,001 $ 70,662
 
Liabilities and stockholders’ equity
Accounts payable and accrued expenses $ 10,847 $ 17,527
Total loans payable 18,017 20,652
Total deferred rent 5,369 10,569
Other liabilities 1,174 1,308
Stockholder's equity   14,594   20,606
 
Total liabilities and stockholders’ equity $ 50,001 $ 70,662
 

Contacts

Company, Media and Investor Contact:
Argot Partners
David Pitts, 212-600-1902
aveo@argotpartners.com

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