BioLineRx (NASDAQ: BLRX) (TASE: BLRX), a clinical-stage biopharmaceutical company dedicated to identifying, in-licensing and developing promising therapeutic candidates, today reported its financial results for first quarter ended March 31, 2014.
Kinneret Savitsky, Ph.D., CEO of BioLineRx, remarked, "In the first quarter of 2014 we have generated significant progress in several of our clinical and pre-clinical programs. We continue to focus our efforts in the therapeutic areas of oncology and immunology, and have succeeded in rapidly advancing our two lead clinical programs - BL-8040 for the treatment of acute myeloid leukemia (AML), stem cell mobilization and other hematological indications; and BL-7010 for the treatment of celiac disease. We anticipate reaching several key milestones for these programs in the coming months. We expect to commence a Phase 1 stem cell mobilization study for BL-8040 during the second quarter, with results expected during the second half of this year. We also expect Prof. Arnon Nagler, Director, Bone Marrow Transplantation Dept. and Cord Blood Bank, Sheba Medical Center, to initiate an investigator-led Phase 1/2 study in Chronic Myeloid Leukemia (CML) in 2014. In addition, we expect to report final Phase 2 data from our AML study for BL-8040 in early 2015. For BL-7010, we anticipate final results from our ongoing Phase 1/2 study in the next few months, and pending positive results, would look to initiate a randomized efficacy study later in 2014. We view these milestones as the primary value drivers for BioLineRx, and we are committed to moving these programs along as expeditiously as possible.
"In addition, BL-1040, which is being developed by Bellerophon (f/k/a Ikaria) as the Bioabsorbable Cardiac Matrix (BCM) device, is in the midst of a CE Mark Registration trial at 80 sites worldwide, 14 of which are in the U.S. Over 200 patients have been enrolled in the trial to date, out of a total planned enrollment of approximately 300 patients. Due to a lower than expected enrollment rate that was recently communicated to us by Bellerophon, we anticipate an approximate six-month delay in the study, with study enrollment to be finalized by the end of 2014, and the study to be completed in mid-2015. Bellerophon has also informed us that it plans to file for a CE mark in the European Union in the second half of 2015.
"On a different note, we have recently been engaged in discussions with Bellerophon relating to its performance under the BL-1040 license agreement. We believe that Bellerophon has breached the agreement in several ways, and we also disagree with Bellerophon about the timing of a $12.5 million milestone payment that Bellerophon would owe to us in the future based upon progress in the BL-1040 clinical development program. We have had a number of discussions with Bellerophon on these issues and these discussions are continuing. Although we hope we can resolve the outstanding issues with Bellerophon amicably, if we are unable to reach agreement with Bellerophon on these issues, we would consider all other remedies available to us.
"Another one of our clinical programs, BL-5010P, for the non-surgical removal of benign skin lesions, is gaining interest in the industry. We are currently engaged in advanced discussions with several potential partners for the out-licensing of BL-5010P in a number of potential indications, such as actinic keratosis and warts, and the outcome of these discussions will determine the development plan for this promising product.
"We can also report progress on the commercialization front as we continue to explore earlier-stage partnering deals, as well as regional and co-development arrangements, in order to reduce the financial risk associated with the development of some of our non-core assets. During the past quarter we entered into a collaboration with JHL Biotech, a Taiwan-based rising star in the global biologics space backed by a consortium of top-tier venture capital firms, for the development and commercialization of BL-9020, a novel monoclonal antibody for the treatment of Type 1 diabetes. In addition to out-licensing the project for development and commercialization in China and Southeast Asia, this partnership provides us with a platform for the development and manufacturing of biologics. These types of arrangements enable us to focus our resources on our lead development assets, while maintaining substantial upside potential on the partnered programs. We also see significant potential for further enhancing our presence in the Asian pharmaceutical industry.
"Following our successful financing in March of this year, we have the necessary funding to executive our development and commercialization plans through 2016, and we look forward to sharing with our shareholders our continued progress as we anticipate a number of significant catalysts over the next several quarters," concluded Dr. Savitsky.
Financial Results for Quarter Ended March 31, 2014
Research and development expenses for the three months ended March 31, 2014 were NIS 9.5 million ($2.7 million), a decrease of NIS 9.9 million ($2.8 million), or 51%, compared to NIS 19.4 million ($5.5 million) for the three months ended March 31, 2013. The decrease resulted primarily from termination of the BL-1020 CLARITY clinical trial in March 2013, which was partially offset by a ramp-up in spending on other clinical-stage projects, primarily BL-8040 and BL-7010.
Sales and marketing expenses for the three months ended March 31, 2014 were NIS 1.3 million ($0.4 million), an increase of NIS 0.5 million ($0.2 million), or 66%, compared to NIS 0.8 million ($0.2 million) for the three months ended March 31, 2013. The increase resulted primarily from professional fees in connection with increased business development activities.
General and administrative expenses for the three months ended March 31, 2014 and 2013 were NIS 3.5 million ($1.0 million).
The Company's operating loss for the three months ended March 31, 2014 amounted to NIS 14.3 million ($4.1 million), compared with an operating loss of NIS 23.7 million ($6.8 million) for the comparable period in 2013.
The Company recognized net non-operating income of NIS 5.9 million ($1.7 million) for the three months ended March 31, 2014, a decrease of NIS 6.4 million ($1.8 million), compared to net non-operating income of NIS 12.3 million ($3.5 million) for the three months ended March 31, 2013. Non-operating income for both periods primarily relates to fair-value adjustments of liabilities on account of the warrants issued in the private and direct placements completed in February 2012 and 2013. These fair-value adjustments are highly influenced by the Company's share price at each period end (revaluation date).
The Company recognized net financial income of NIS 1.0 million ($0.3 million) for the three months ended March 31, 2014, a change of NIS 2.4 million ($0.7 million), compared to net financial expenses of NIS 1.4 million ($0.4 million) for the three months ended March 31, 2013. Net financial income and expenses result primarily from changes in the average exchange rate of the dollar in relation to the NIS during the respective periods, which have a direct effect on the Company's net assets denominated in dollars.
The Company's net loss for the three months ended March 31, 2014 amounted to NIS 7.4 million ($2.1 million), compared with a net loss of NIS 12.8 million ($3.7 million) for the comparable period in 2013.
The Company held NIS 130.7 million ($37.5 million) in cash, cash equivalents and short-term bank deposits as of March 31, 2014
Net cash used in operating activities was NIS 11.8 million ($3.4 million) for the three months ended March 31, 2014, compared with net cash used in operating activities of NIS 19.2 million ($5.5 million) for the three months ended March 31, 2013. The NIS 7.4 million ($2.1 million) decrease in net cash used in operating activities during the three-month period in 2014, compared to the three-month period in 2013, was primarily the result of decreased research and development spending.
Net cash used in investing activities for the three months ended March 31, 2014 was NIS 66.2 million ($19.0 million), compared to net cash used in investing activities of NIS 43.8 million ($12.6 million) for the three months ended March 31, 2013. The changes in cash flows from investing activities relate primarily to investments in, and maturities of, short-term bank deposits and other investments during the respective periods.
Net cash provided by financing activities for the three months ended March 31, 2014 was NIS 78.6 million ($22.5 million), compared to net cash provided by financing activities of NIS 42.0 million ($12.1 million) for the three months ended March 31, 2013. The cash flows from financing activities in 2014 primarily reflect the underwritten public offering completed in March 2014. The cash flows from financing activities in 2013 primarily reflect the direct placement to OrbiMed completed in February 2013, as well as funding under the share purchase agreement with LPC.
Conference Call and Webcast Information
BioLineRx will hold a conference call to discuss its first quarter 2014 results today, May 20, 2014, at 10:00 a.m. EDT. A presentation will be available on BioLineRx's website to accompany management's remarks on the call.