RXi Pharmaceuticals Corporation (NASDAQ: RXII), a biotechnology company focused on discovering, developing and commercializing innovative therapies addressing major unmet medical needs using RNA-targeted and immunotherapy technologies, today reported its financial results for the quarter ended March 31, 2011.

“Our recent acquisition of NeuVax and focus on RXI-109 significantly advances RXi into a product development company with novel therapeutics addressing large unmet medical needs,” said Mark J. Ahn, PhD, President and Chief Executive Officer of RXi Pharmaceuticals. “We believe we currently have the people, pipeline and resources to realize the promise of our innovative product candidates for patients and shareholders.”

Recent Highlights

Corporate Highlights
  • Moved into Late-Stage Clinical Development with the Acquisition of Apthera, Inc. On April 13, 2011, RXi completed the acquisition of Apthera, Inc., a private biotechnology company developing an oncology pipeline of peptide-based immunotherapies. The acquisition provides RXi with a late stage product candidate, NeuVax (E75), a peptide-based immunotherapy for low-to-intermediate HER2+ breast cancer, not eligible for Herceptin® (trastuzumab), which is expected to enter Phase III clinical trials in the first half of 2012 under a Special Protocol Assessment (SPA) from the U.S. Food and Drug Administration (FDA). Phase II data after 36 months of treatment, as well as Phase III plans, will be presented at the American Society of Clinical Oncology (ASCO) annual meeting in June 2011.
  • Initiated Development Program for Dermal Anti-Scarring Product Candidate. RXi initiated its development program for RXI-109 with a goal of submitting an Investigational New Drug (IND) application in the second half of 2011. The company began manufacturing activities with a cGMP oligonucleotide manufacturer and is preparing a pre-IND package for submission to the FDA. Pending FDA review, the company intends to employ an innovative clinical trial design to study safety and tolerability as well as initial efficacy in its first clinical trial targeted for 2012. In this clinical trial, RXi plans to evaluate RXI-109 for the reduction of dermal scarring in planned surgeries.
  • Completed $8.1 million public offering in Mar 2011. Net proceeds from this offering resulted in approximately $7.3 million to RXi. In addition, the company completed a separate offering of $12 million in April 2011 resulting in $10.9 million in net proceeds, bringing RXi’s total pro forma cash position to over $20 million. RXi was also granted approximately $1 million in grants. The company believes it has sufficient resources to initiate the clinical trials of its lead product candidates.

Scientific Achievements
  • Announced Positive Research Data from a collaboration with Generex Biotechnology Corporation. Initial results from the collaboration between RXi and Generex demonstrated success in using RXi's proprietary self-delivering rxRNA™ (sd-rxRNA™) compounds to silence genes up to 80% in hemopoietic cells. The ability to knock down expression of certain genes in isolated hemopoietic-derived cancer cells ( ex vivo) has the potential to convert them into specific immune-stimulants and opens the possibility for development of a new class of anticancer therapeutic vaccines.
  • Presented New Preclinical RNAi Data on rxRNA Compounds. RXi announced new preclinical data using proprietary self-delivering RNAi (sd-rxRNA) compounds, including RXI-109, at the Keystone Symposia's Mechanism and Biology of Silencing conference held March 20-25, 2011 in Monterey, California.

Quarterly Financial Highlights:

Cash, Cash Equivalents and Short Term Investments

As of March 31, 2011, RXi had cash and cash equivalents of approximately $11.1 million, compared with $14.9 million as of March 31, 2010, and $19.6 million as of April 30, 2011. The increase in cash and cash equivalents from March 31, 2011 to April 30, 2011 is attributable to the net proceeds of approximately $10.9 million from the offering that closed on April 20, 2011.

Net Loss

Net cash used in operating activities was approximately $3,027,000 for the three months ended March 31, 2011, compared with $2,444,000 for the three months ended March 31, 2010. The increase of approximately $583,000 resulted primarily from a net loss of $3,841,000, of which $1,314,000 related to stock-based compensation, $23,000 related to common stock issued in exchange for services, $76,000 related to stock warrant expense in exchange for services, $37,000 related to depreciation and $1,435,000 that reflects the fair value of warrants and mandatorily redeemable stock obligations issued with the registered direct financings completed by the Company in 2009, 2010 and 2011,and $800,000 related to changes in current assets and liabilities.

Research and Development Expense

Total research and development expenses were approximately $2,156,000 for the three months ended March 31, 2011, compared with $1,926,000 for the three months ended March 31, 2010. The increase of $230,000, or 12% was due to an increase of $442,000 in ocular and dermal anti-scarring related studies and consulting activities, offset by a decrease in non-cash employee and non-employee share based compensation of $212,000, primarily related to timing of grants and changes in Black-Scholes assumptions.

General and Administrative Expenses

General and administrative expenses were approximately $3,118,000 for the three months ended March 31, 2011, compared with $2,530,000 for the three months ended March 31, 2010. The increase of $588,000 or 23% was due to a $327,000 increase in non-cash share based compensation which was partially offset by a $234,000 decrease in non-cash compensation expense related to a warrant issued for business advisory services. Excluding the non-cash items, general and administration expenses were approximately $1,919,000 for the three months ended March 31, 2011, compared with $1,448,000 for the three months ended March 31, 2010.

About NeuVax™ (E75)

NeuVax consists of the E75 peptide derived from HER2 combined with the immune adjuvant granulocyte macrophage colony stimulating factor (GM-CSF). Treatment with NeuVax stimulates cytotoxic (CD8+) T cells in a highly specific manner to target cells expressing any level of HER2. NeuVax is given as an intradermal injection once a month for six months, followed by a booster injection once every six months. Based on a successful Phase II trial, which achieved its primary endpoint of disease free survival (DFS), the Food and Drug Administration (FDA) granted NeuVax a Special Protocol Assessment (SPA) for a Phase III clinical trial in adjuvant therapy of women with low-to-intermediate HER2+ status.

According to the National Cancer Institute, over 200,000 women in the U.S. are diagnosed with breast cancer annually. Of these women, about 75% test positive for Human Epidermal growth factor Receptor 2 (IHC 1+, 2+ or 3+). Only 25% of all breast cancer patients, those with HER2 3+ disease are eligible for Herceptin® (trastuzumab; Roche-Genentech) which had revenues of over $5 billion in 2010. NeuVax targets the remaining 50% of HER2 positive patients (HER2 1+ and 2+) who achieve remission with current standard of care, but have no available HER2 targeted adjuvant treatment options to maintain their disease free status.

About RXI-109

RXi Pharmaceuticals has initiated development of clinical candidate RXI-109, a self-delivering RNAi compound (sd-rxRNA) for the reduction of dermal scarring in planned surgeries. RXI-109 is designed to reduce the expression of CTGF (connective tissue growth factor), a critical regulator of several biological pathways involved in fibrosis, including scar formation in the skin. RXi is beginning manufacturing activities with an experienced cGMP oligonucleotide manufacturer to support its IND enabling toxicology program, and is preparing a pre-IND package for submission to the FDA. Pending FDA review, the company intends to use an innovative clinical trial design to study safety and tolerability as well as initial efficacy in its first clinical trial targeted for 2012.

About RXi Pharmaceuticals Corporation

RXi Pharmaceuticals Corporation (NASDAQ: RXII) is a biotechnology company focused on discovering, developing and commercializing innovative therapies addressing major unmet medical needs using RNA-targeted and immunotherapy technologies. For more information, visit www.rxipharma.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the future expectations, plans and prospects of the development of RXi Pharmaceuticals Corporation's products. These forward-looking statements about future expectations, plans and prospects of the development of the Company's products are subject to a number of risks, uncertainties and assumptions, including those identified under "Risk Factors" in the Company's most recently filed Annual Report on Form 10-K, Quarterly Report on Form 10-Q and in other filings the Company periodically makes with the SEC. Actual results may differ materially from those contemplated by these forward-looking statements. The Company does not undertake to update any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after the date of this presentation.
     

RXi PHARMACEUTICALS CORPORATION

(A Development Stage Company)
 

CONDENSED STATEMENTS OF EXPENSES

(Amounts in thousands, except share and per share data)

(Unaudited)

 

 

 

 

 

 
 
Period
from
For the For the January 1,
Three Three 2003
Months Months (Date of
Ended Ended Inception) to
March 31, March 31, March 31,
2011 2010 2011
 
 
Research and development expenses

$

2,156

$

1,926

$

41,263
 
General and administrative expenses 3,119 2,530 34,189
 
Operating loss (5,275) (4,456 ) (75,452)
Other income (expense), net   1,434   570   5,827
 
Net loss $ (3,841) $ (3,886 ) $ (69,625)
 
Net loss per common share:
Basic and diluted loss per share $ (0.19) $ (0.24)   N/A
 
Weighted average common shares outstanding:
Basic and diluted   20,316,170   16,386,435   N/A
 
 
RXi PHARMACEUTICALS CORPORATION
(A Development Stage Company)
 
CONDENSED BALANCE SHEETS
(Amounts in thousands, except share and per share data)
(Unaudited)
 
  March 31,  

December 31,
2011

2010
ASSETS
Current assets:
Cash and cash equivalents $ 11,115 $ 6,891
Prepaid expenses and other current assets   283   150
 
Total current assets   11,398   7,041
 
Equipment and furnishings, net 466 419
Deposits   16   16
 
Total assets $ 11,880 $ 7,476
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 726 $ 724
Accrued expenses and other current liabilities

1,916
1,113
Current maturities of capital lease obligations 59 51
Fair value of warrants potentially settleable in cash   5,915   3,138
 
Total current liabilities 8,616 5,026
Capital lease obligations, net of current maturities   33   20
 
Total liabilities 8,649 5,046
Total stockholders' equity   3,231   2,430
 
Total liabilities and stockholders' equity $ 11,880 $ 7,476
 

Copyright Business Wire 2010

If you liked this article you might like

3 Stocks Under $10 to Trade for Breakouts

3 Stocks Under $10 to Trade for Breakouts

Insider Trading Alert - RXII, MA And SWN Traded By Insiders

Insider Trading Alert - RXII, MA And SWN Traded By Insiders

RXi Pharmaceuticals (RXII) Is Strong On High Volume Today

RXi Pharmaceuticals (RXII) Is Strong On High Volume Today

Biotech Stock Mailbag: Avanir Pharma

Biotech Stock Mailbag: Avanir Pharma

Rodman Rambles: Promising Biotechs

Rodman Rambles: Promising Biotechs