R&D expenses were $6.4 million for the six months ended June 30, 2012, compared to $4.3 million for the same period in 2011. The increase in R&D expenses was attributable to primarily the same factors as the 2 nd quarter plus option fee and diligence-related costs associated with our recent license of CFT.Selling, general and administrative (SG&A) expenses were $3.0 million for the quarter ended June 30, 2012, compared to $1.7 million for the same period in 2011. The net SG&A increase of $1.3 million between the two periods was primarily due to increased marketing and business development costs in preparation for the commercial launch of Lymphoseek and efforts to continue to build the Company’s pipeline, coupled with increased general and administrative headcount and other support costs, offset by decreased professional services costs. SG&A expenses were $5.5 million for the six months ended June 30, 2012, compared to $4.6 million for the same period in 2011. The net SG&A increase of $917,000 between the two periods was primarily due to increased marketing and business development costs in preparation for the commercial launch of Lymphoseek and efforts to continue to build the Company’s pipeline, coupled with increased general and administrative headcount and other support costs, but was offset by approximately $1.9 million in non-recurring charges related to the separation of the Company’s former President and CEO incurred in the first half of 2011 and decreased professional services costs. As of June 30, 2012, Navidea had cash and cash equivalents totaling approximately $17.0 million. “We remain focused on supporting our expected U.S. Lymphoseek approval and commercial launch as well as the planned advancement of its global registration process this year,” said Dr. Mark Pykett, Navidea President and CEO. “In collaboration with our U.S. marketing partner, Cardinal Health, we are making important strides to support commercial introduction and market penetration, completing competitive product and launch analyses, customer surveys, and marketing and medical education plans. We also continue to build relationships with key opinion leaders, early adopters, and patient advocacy groups in support of a successful launch.”
Recent business and program highlights:
- Completed a $50 million credit facility with Platinum-Montaur Life Sciences providing the Company with significant, yet flexible, financial resources to fund short- and long-term development and growth plans.
- Completed the license agreement with Alseres Pharmaceuticals, Inc. for a second promising neuroimaging candidate. [ 123I]-E-IACFT Injection, an Iodine-123 radiolabeled imaging agent will be developed as an aid in the diagnosis of Parkinson’s disease and other movement disorders and a potential use as a diagnostic aid in dementia.
- Received approval for the Phase 2 AZD4694 protocol from the New England Institutional Review Board (IRB), a centralized IRB that oversees the approval of clinical protocols for investigational drugs for multiple research organizations. Trial enrollment is expected to commence in the coming months.
- Presented data on Lymphoseek and AZD4694 at major scientific and medical conferences:
- Lymphoseek data was presented by three independent investigators at 8th International Conference on Head and Neck Cancer. Investigators from the University of Texas MD Anderson Cancer Center, The Ohio State University and the University of Miami reported their personal experiences with the use of Lymphoseek in head and neck squamous cell carcinoma.
- Head-to-head study comparing Navidea’s AZD4694 to the gold standard for imaging beta amyloid protein deposits was presented at Alzheimer's Association International Conference and the Society of Nuclear Medicine. Results from Austin Health, Melbourne, Australia clinical trial examined and reported AZD4694 performance characteristics and blinded reader confidence when used as an aid in diagnosing Alzheimer's disease. Results demonstrated strong similarity of AZD4694 to the long-standing agent of choice, PiB. A poster and another podium talk from investigators at Banner Alzheimer Institute and Astra Zeneca were also presented.
- Additional podium and poster presentations highlighting similar Lymphoseek Phase 3 results were made at: the European Association for Cancer Research, the Society for Nuclear Medicine, European Society for Therapeutic Radiology and Oncology , Australasian Lymphology Association and International Symposium on Sentinel Node Biopsy in Head and Neck Cancer.
- Additional Early clinical development AZD4694 data was presented by Astra Zeneca at 12 th International Stockholm/Springfield Symposium on Advances in Alzheimer Therapy.
- Meta-analysis of Lymphoseek Phase 3 data compared to standard of care techniques was published in conjunction with the ASCO Annual Meeting. Data from the Phase 3 trial for Intraoperative Lymphatic Mapping (ILM) of lymph nodes in breast cancer compared to sulfur colloid and vital blue dye was reviewed in this online abstract publication.
- Published data developed from Phase 3 trials of Lymphoseek (99m-Tc-Tilmanocept) demonstrating important performance characteristics of Lymphoseek compared to a commercially available radiolabeled colloid used in intra-operative lymphatic mapping. The analysis evaluated the performance of Lymphoseek to a meta-analysis of published data for 99m-Tc-labeled nanocolloid human serum albumin (Nanocoll ®), commercially available and considered the standard of care in Europe. The difference between Lymphoseek and Nanocoll in the parameters analyzed was statistically significant. (p < 0.0001) The study, “The efficacy of Tilmanocept in sentinel lymph node mapping and identification in breast cancer patients: a comparative review and meta-analysis of the 99m-Tc-labeled nanocolloid human serum albumin standard of care,” can found in the current online edition of the peer-reviewed journal Clinical and Experimental Metastasis [DOI 10.1007/s10585-012-9497-x].
Conference Call DetailsNavidea's President and CEO, Dr. Mark Pykett, Executive Vice President and Chief Business Officer, Dr. Thomas Tulip, Senior Vice President, Pharmaceutical Research and Clinical Development, Dr. Fred Cope and Senior Vice President and CFO, Brent Larson, will provide a development and business update and will discuss the Company's financial results for the second quarter and first six months of 2012 during the conference call. The conference call can be accessed as follows:
|CONFERENCE CALL INFORMATION|
|TO PARTICIPATE LIVE:||TO LISTEN TO A REPLAY:|
|Date:||August 7, 2012||Available until:||August 21, 2012|
|Time:||8:00 AM EDT||Toll-free (U.S.) Dial in # :||(877) 660-6853|
|International Dial in # :||(201) 612-7415|
|Toll-free (U.S.) Dial in # :||(877) 407-8033|
|International Dial in # :||(201) 689-8033||Replay passcode:|
|Conference ID #:||398463|
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|June 30,2012||December 31,2011|
|Other current assets||1,741,251||1,402,517|
|Liabilities and stockholders' equity:|
|Note payable, net of discount, current||$||2,341,151||$||-|
|Derivative liabilities, current||793,418||568,930|
|Other current liabilities||2,466,449||2,779,540|
|Note payable, net of discount||4,232,391||6,456,388|
|Total liabilities and stockholders' equity||$||20,014,563||$||31,193,920|
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS|
|Three Months Ended||Six Months Ended|
|June 30,2012||June 30,2011||June 30,2012||June 30,2011|
|Research and development||2,476,113||1,866,252||6,419,827||4,301,851|
|Selling, general and administrative||2,970,837||1,727,145||5,545,467||4,628,853|
|Total operating expenses||5,446,950||3,593,397||11,965,294||8,930,704|
|Loss from operations||(5,386,950||)||(3,587,262||)||(11,893,363||)||(8,588,607||)|
|Change in derivative liabilities||(92,805||)||(10,352||)||(276,889||)||(964,141||)|
|Other income (expense), net||(33,662||)||2,598||(38,566||)||5,406|
|Loss before income taxes||(5,834,822||)||(3,596,074||)||(12,823,894||)||(9,550,007||)|
|Benefit from income tax||-||478,444||-||999,257|
|Loss from continuing operations||(5,834,822||)||(3,117,630||)||(12,823,894||)||(8,550,750||)|
|Discontinued operations, net of tax effect||-||928,740||-||1,939,731|
|Preferred stock dividends||(25,000||)||(25,000||)||(50,000||)||(50,000||)|
|Loss attributable to common stockholders||$||(5,859,822||)||$||(2,213,890||)||$||(12,873,894||)||$||(6,661,019||)|
|Loss per common share (basic and diluted):|
|Attributable to common stockholders||$||(0.06||)||$||(0.02||)||$||(0.14||)||$||(0.08||)|
|Weighted average shares outstanding:|
|Basic and diluted||94,664,659||89,660,089||94,368,690||87,549,776|