AVEO Oncology (NASDAQ: AVEO) today reported consolidated 2013 financial results and outlined its 2014 strategic plan and financial guidance.
“With the cost-containment measures implemented in the second half of 2013, AVEO ended the year in a strong financial position,” said Tuan Ha-Ngoc, president and chief executive officer of AVEO. “Our strategy going forward will focus on driving growth by investing in the continued advancement of our AV-380 program in cachexia and pursuing further development of our clinical-stage assets through collaborations. In addition, we will continue to evaluate opportunities to acquire or in-license compounds that will further accelerate value creation.”
Cachexia is a serious and common syndrome in patients with advanced cancer and other chronic diseases, characterized by symptoms of unintentional weight loss, progressive muscle wasting and loss of appetite (anorexia). Cachexia is associated with increased mortality and 50% of patients with cancer die with cachexia present.
Development Programs Update
- AV-203 – AVEO successfully completed a Phase 1 safety study showing no dose limiting toxicities at maximum dose of 20mg/kg and Clinical Laboratory Improvements Amendment (CLIA) validation has been completed for a biomarker for potential patient selection. Results from this study are expected to be presented at a scientific meeting in 2014.AVEO will seek a partner to support further clinical development of AV-203, subject to regaining certain rights from Biogen Idec, who currently has the option to develop AV-203 in territories outside of the U.S. The single agent expansion cohort in a biomarker-positive patient population has been terminated pending a development partnership agreement.
Full Year 2013 Financial Results
- Ficlatuzumab – In 2013, an exploratory analysis using a serum-based molecular diagnostic test identified a patient sub-population that experienced a statistically significant progression-free survival and overall survival benefit on the combination therapy in the Phase 2 trial of ficlatuzumab in combination with gefitinib compared to gefitinib monotherapy in first line non-small cell lung cancer. These results are expected to be presented at a scientific meeting later in 2014. AVEO is actively seeking collaboration opportunities to support the clinical development of ficlatuzumab in this patient group with the goal of initiating a confirmatory Phase 2 study.
- Tivozanib – On February 14, 2014, AVEO and Astellas announced their decision to terminate their collaboration for the development and commercialization of tivozanib. Costs for ongoing tivozanib-related expenses will be shared by the parties. AVEO estimates that AVEO’s share of costs for these activities will be approximately $12 million in 2014. Based on the terms of the agreement, all rights for tivozanib will revert to AVEO in August 2014, six months after Astellas notified AVEO of its intention to terminate the agreement. AVEO plans to explore potential partnership opportunities for the further clinical development of tivozanib.
- AV-380 (GDF-15 Program) - AV-380, a potential first-in-class GDF-15 inhibitor, was discovered using AVEO’s proprietary Human Response Platform™, that provides the company unique insights into cancer and related disease biology. The clinical program will be designed to obtain rapid proof of clinical activity with first-in-human clinical trials planned for the second half of 2015. Initial clinical development is expected to be for the treatment of cancer cachexia. AVEO plans to evaluate opportunities for partnerships to expand the development of AV-380 for the treatment of cachexia associated with other indications such as chronic kidney disease, congestive heart failure and chronic obstructive pulmonary disease.
2014 Financial Guidance
- AVEO ended 2013 with cash, cash equivalents and marketable securities of $118.5 million.
- Total collaboration revenue for 2013 was approximately $1.3 million compared with $19.3 million for 2012. The decrease was primarily due to revenue recognized during 2012 that did not recur during 2013, including a $15.0 million milestone payment earned under AVEO’s collaboration agreement with Astellas related to the FDA’s acceptance of the NDA filing for tivozanib and revenue earned under AVEO’s agreements with OSI Pharmaceuticals, Inc. and Centocor Ortho Biotech Inc. Revenue recognized during 2013 consisted of the amortization of previously deferred amounts related to AVEO’s collaboration agreements with Biogen Idec International GmbH and Astellas.
- Research and development (R&D) expense for 2013 was $68.5 million compared with $91.4 million for 2012. The decrease in R&D expense was primarily due to a reduction in personnel-related expenses following the strategic restructurings announced in October 2012 and June 2013, and a decrease in clinical trial and regulatory costs for tivozanib and ficlatuzumab, offset by additional development costs for ficlatuzumab relating to the manufacture of clinical material and by additional facilities costs due to additional leased space at 650 East Kendall Street.
- General and administrative (G&A) expense for 2013 was $28.7 million compared with $36.9 million for 2012. The decrease in G&A expense was primarily due to a reduction in personnel-related expenses following our strategic restructuring announced in June 2013 and a reduction in pre-commercialization costs associated with tivozanib.
- Restructuring expense for 2013 was $8.0 million compared with $2.6 million for 2012. The increase is primarily the result of the additional costs incurred in connection with our June 2013 strategic restructuring.
- Net loss for 2013 was $107.0 million, or basic and diluted net loss per share of $2.10, compared with net loss of $114.4 million, or basic and diluted net loss per share of $2.64 for 2012.
Based on current operating plans, AVEO expects to end 2014 with approximately $50-$55 million in cash, cash equivalents and marketable securities.