(all figures are in Canadian dollars unless otherwise noted)
BELLEVILLE, ON, Sept. 27, 2013 /PRNewswire/ - Bioniche Life Sciences Inc. (TSX:
BNC) (ASX: BNC), a research-based, technology-driven Canadian
biopharmaceutical company, today announced financial results for its
fiscal year ended June 30, 2013.
"The Company is undergoing a significant transition," said Graeme McRae,
President & CEO. "The pending divestment of the Animal Health business
and potential sale or partnering of the One Health/VMC business will
change the face of the Company into a human pharmaceutical business
with a Phase III bladder cancer product that could be selling in the
market within the next two years. It should be noted that this is one
of the few new bladder cancer technologies to have been developed in
decades and it has been taken from inception to late-stage by our
Company, and bladder cancer is the 4th most common cancer in North American men."
"The proceeds from the newly closed Canadian equity financing, along
with additional funds to be advanced under the Paladin loan and cash in
hand, will provide an approximate cash balance of $16 million," added
As a result of the Company's decision to divest the Animal Health
business, the Fiscal 2013 year-end financial statements have been
segmented into continuing operations (Human Health and One Health
business units) and discontinued operations (Animal Health business
Fiscal 2013 Financial Results Highlights
The Company's continuing operations recorded income of $82,000 in Fiscal
2013, related to research collaborations. This compares to $2.0 million
from this source in Fiscal 2012. In Fiscal 2012, the Company received
reimbursement from its former development partner for Urocidin-related development costs. Such reimbursement was discontinued when the
Company regained global rights to Urocidin in December, 2012.
Fiscal year-end cash, cash equivalents and short-term investments
amounted to $4.2 million at June 30, 2013, as compared to $20.0 million
at June 30, 2012, when the Company had just completed a US$20 million
debt financing with Capital Royalty L.P. This reflects the debt from
Paladin and the adjustment of the Capital Royalty loan following a
renegotiation that was concluded in June, 2013.
The Company's total liabilities and shareholders' equity at June 30,
2013 is $61.5 million, as compared to $82.2 million at June 30, 2012.
The Company's consolidated cash flow used in operations for the year
ended June 30, 2013 was ($15.7) million, as compared to cash used in
operations of ($17.2) million in Fiscal 2012. The average monthly burn
rate was $1.3 million for Fiscal 2013, as compared to $1.4 million for
Fiscal 2012. Cash requirements to support financing have increased the
Company's average monthly burn rate to approximately $1.6 million per
month at the present time.
Administrative expenses for continuing operations were $6.3 million in
Fiscal 2013, as compared to $7.2 million in Fiscal 2012. Marketing and
selling expenses were $0.9 million in Fiscal 2013, as compared to $1.2
million in Fiscal 2012. Financial expenses were $8.5 million for Fiscal
2013, as compared to $3.1 million in Fiscal 2012. The increase in
financial expenses relates primarily to the loss on extinguishment of
the Company's debt with Capital Royalty, which was assumed by Paladin
Labs on June 5, 2013.
Net research and development (R&D) expenditures for continuing
operations were $16.3 million in Fiscal 2013, as compared to $14.2
million in Fiscal 2012. This includes the continued investment in the
staffing and infrastructure associated with the GMP production of the
Company's UrocidinTM bladder cancer treatment that is in Phase III clinical development.
Until such time as the Company's Vaccine Manufacturing Centre in
Belleville is making commercial product, the carrying costs associated
with this facility are also accounted for under R&D. Fiscal 2013
includes a non-cash impairment charge of $3.7 million related to this
Additional R&D resources are focused on the advancement of a second
generation E. coli O157 cattle vaccine.
The basic and fully diluted net loss per share for the Company's
continuing operations for Fiscal 2013 is ($0.32), as compared to a
basic and fully diluted net loss per share of ($0.23) in Fiscal 2012.
Fiscal 2013 Financial Results Highlights - Discontinued Operations (Animal Health)
In May, 2013, the Company formally commenced the process to divest its
Animal Health business and concentrate on becoming a Human Health
company. The divestment is expected to be completed within the next 12
months. Revenues for this business unit in Fiscal 2013 were $31.5
million, as compared to $29.8 million in Fiscal 2012 with a net income
in Fiscal 2013 of $3.3 million, as compared to a net loss of ($894,000)
in Fiscal 2012.
The basic and fully diluted earnings per share for this business unit in
Fiscal 2013 is $0.03, as compared to a basic and fully diluted loss per
share of ($0.01) in Fiscal 2012.
Fiscal 2013 Summary
The Company has total Common Shares outstanding at September 26, 2013 of
140,113,142. In addition, the Company has 22,270,912 outstanding
Warrants and 6,501,009 outstanding Options, exchangeable for one Common
Share upon exercise.
More information on the Company's year-end financial results is provided
in the Company's Fiscal 2013 Management's Discussion and Analysis dated
September 26, 2013.
The Company has successfully made three consecutive batches of sterile
filtered media in the two fermentors in the VMC. The three batches were
all found to be free of bacterial contamination, meaning that the
fermentation area of the VMC has achieved GMP validation.
Normally, the next step in validation would be to validate the vaccine
filling line in the VMC. However, the Company has elected to plan for
the manufacture of an essential product component that is currently
made at an external contract manufacturer in the filling area. This
product component is diluent, and it is used in our top-selling animal
health product, Folltropin®-V.
Our agreement with the contract manufacturer of diluent and two other
animal health drug products expires in June, 2014, and it will not be
renewed. The Company faced the choice of trying to find an alternative
external manufacturer for these products or making them itself. By
doing the work in-house, the Company will save money and have more
control over supply.
Diluent does not require media fill validation since it is terminally
sterilized by autoclaving. To qualify this product in our VMC filling
line, the Company must produce three consecutive process validation
batches and apply to Health Canada for a site change (establishment
license), which will trigger a facility inspection. It is expected
that the Health Canada application will be submitted by January, 2014
and an inspection would follow approximately three months later.
Assuming the inspection is successful and the establishment license is
granted, the Company will return to validating the filling line for
aseptic filling of Econiche® vaccine. This will mark the end of the GMP validation process for Econiche®.
The Company is also currently in discussion with companies who have
expressed interest in the manufacturing capabilities of the VMC whereby
the Company would act as a contract manufacturer.
Divestment of Animal Health Business
The Company engaged Evercore in May, 2013 to lead the divestment
process. Interested parties have submitted non-binding expressions of
interest from which a short-list of counterparties was chosen. Such
counterparties are conducting due diligence on the business. Final
binding terms are expected to be submitted to the Company by the end of
October, 2013. The sale of Animal Health will be subject to, among
other things, any applicable shareholder and regulatory approval and
compliance with any applicable legal and regulatory requirements. Due
to the current anticipated timing for receiving final terms, the
Company anticipates that the proposed sale transaction will be
presented to shareholders to vote on at a separate special shareholders
meeting to be held after the date of the 2013 Annual Meeting of
Shareholders. Such sale transaction is expected to be completed by
The Company is focused on licensing Urocidin rightsfor major markets such as the U.S. and Europe, as well as preparations
for its launch in Canada. The Company has recently completed a license
agreement with Paladin for the Canadian, Mexican and South African
markets which will require support to finalize the pricing and
reimbursement strategy. For the U.S. and other market licenses, the
Company began receiving unsolicited requests for information on
possible regional licenses for Urocidin early in 2013. To date, the Company has a list of 9 companies in the
U.S. and 18 companies in Europe that have requested to be considered as
license partners for Urocidin, and a list of 9 companies for smaller markets. The key to leveraging
licensing opportunities is to have the regulatory pathway established
for the U.S., at which point the Company will engage in more formal
licensing discussions with an expectation that a license deal can be
made for at least the U.S. in the next 12 to 15 months. Management
anticipates spending between $500,000 and $1 million on licensing and
launch efforts, mostly in early 2014.
About Bioniche Life Sciences Inc.
Bioniche Life Sciences Inc. is a research-based, technology-driven
Canadian biopharmaceutical company focused on the discovery,
development, manufacturing, and marketing of proprietary and innovative
products for human and animal health markets worldwide. The
fully-integrated company employs more than 200 skilled personnel and
has three operating divisions: Human Health, Animal Health, and One
Health. The Company's primary goal is to develop and commercialize
products that advance human or animal health and increase shareholder
For more information, please visit www.Bioniche.com.
Except for historical information, this news release may contain
forward-looking statements that reflect the Company's current
expectation regarding future events. These forward-looking statements
involve risk and uncertainties, which may cause, but are not limited
to, changing market conditions, the successful and timely completion of
clinical studies, the establishment of corporate alliances, the impact
of competitive products and pricing, new product development,
uncertainties related to the regulatory approval process, and other
risks detailed from time to time in the Company's ongoing quarterly and
SOURCE Bioniche Life Sciences Inc.