Pfenex Inc. (NYSE MKT: PFNX), a clinical-stage biotechnology company engaged in the development of high-value and difficult to manufacture proteins including biosimilar therapeutics, today provided a business update and reported financial results for the second quarter ended June 30, 2014.
"With the successful completion of our initial public offering, we have the capital to continue to advance our biosimilar product candidates, derived from our proprietary protein expression platform," stated Bertrand C. Liang, chief executive officer of Pfenex. "We expect to complete the phase 1b/2a trial for our lead product candidate, PF582, a biosimilar to Lucentis, by the end of 2014 and initiate the phase 3 trial in mid-2015."
- On July 29, 2014 we closed our initial public offering. Including the underwriters exercise of their option to purchase additional shares, 9,429,084 shares of common stock were sold in the offering for a total capital raise of approximately $52.6 million after underwriter fees and discounts but before deducting offering expenses.
- With the close of our initial public offering, Pfenex expanded the leadership team through the addition of two new board members, William R. Rohn and Philip R. Schneider. Mr. Rohn joined the board as chairman and brings extensive biotech industry experience having served in managerial roles at Biogen IDEC, IDEC Pharmaceuticals and Adria Laboratories. Mr. Schneider also joined the board with broad industry experience through previous management positions with IDEC Pharmaceuticals and Syntex Pharmaceuticals.
Financial Highlights for the three months ended June 30, 2014
- Total revenue for the second quarter of 2014 was $3.3 million compared to $2.3 million in the second quarter of 2013. The increase in revenue was due to an increase in activity related to our Px563L product candidate development under our government contracts, offset in part by a decrease in the protein production service work.
- Cost of revenue was $2.5 million in the second quarter of 2014 compared to $1.3 million in the second quarter of 2013. The increase in cost of revenue was due primarily to the increased development costs for our proprietary novel vaccine programs which are funded by various government agencies.
- Research and development expenses were $0.9 million for the second quarter of 2014 compared to $1.3 million in the second quarter of 2013. The decrease in research and development expenses was due in part to an increase in development activity by our partner, Stelis, and resulting decrease in activity by Pfenex, of PF530, as well as manufacturing activity and purchase of comparator material for our product candidate, PF582, phase 1b/2a trial in the year ago period. We expect research and development expense to increase as we advance our lead candidates and pipeline products.
- Selling, general and administrative expenses were $2.0 million in the second quarter of 2014 compared to $1.7 million in the second quarter of 2013. The increase in selling, general and administrative expenses was due to an increase in audit and consulting fees. We expect selling, general and administrative expenses to increase for activities associated with operating as a public company.
- Not including the proceeds from our initial public offering and the exercise of the underwriters' option to purchase additional shares, cash, cash equivalents and short-term investments, excluding restricted cash, was $3.9 million as of June 30, 2014, compared to $5.2 million as of December 31, 2013. As of June 30, 2014 we had $3.8 million drawn under our $3.9 million revolving credit facility and $4.0 million of restricted cash as collateral for the credit facility.