Montreal, Canada. March 13, 2013 – MethylGene Inc. (TSX: MYG) today reported financial results for the fourth quarter and full year ended December 31, 2012.
• On November 12, 2012, we announced the appointment of Charles M. Baum, M.D., Ph.D., as President and Chief Executive Officer.
• On November 21, 2012, we completed a private placement of $26.1 million, extending our financial resources into the second half of 2014.
• We completed enrollment in the randomized controlled Phase II study evaluating MGCD290 plus fluconazole in patients with moderate to severe vulvovaginal candidiasis. We expect to report topline data from this study in March 2013.
• We announced the appointment of Mark J. Gergen to the position of Executive Vice President and Chief Operating Officer on February 19, 2013.
“2012 was a year of progress and renewal for MethylGene,” said Charles Baum, M.D., Ph.D., President and CEO of MethylGene. “We are continuing to build momentum in our clinical programs, and we are moving forward in 2013 with a strengthened leadership team.”
International Financial Reporting Standards
The financial statements of the Company for the year ended December 31, 2012, have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
Fourth Quarter 2012 Financial Results Reported in Canadian Dollars
There were no revenues in the fourth quarter of 2012, a reduction of $468,000 versus the fourth quarter of 2011. License and up-front fees decreased by $468,000 as we amortized the remaining deferred revenue in relation to the Taiho agreement in the fourth quarter of 2011.
Research and development expenditures for the fourth quarter of 2012, net of investment tax credits, were $4.9 million, which was $1.8 million higher versus the fourth quarter of 2011. This increase was mainly due to increased clinical development activities for both of our lead programs, MGCD290 and MGCD265, resulting in higher internal and third-party clinical costs.
General and administrative expenses in the fourth quarter of 2012 were $1.4 million, up $0.3 million versus the fourth quarter of 2011, primarily due to increased non-cash stock option costs and increased professional expenses relating to the appointment of our new CEO.
Financial income, relating primarily to interest income, was $64,000 in the fourth quarter of 2012, $18,000 lower than the fourth quarter of 2011 due to lower average cash balances for the quarter versus the prior
year. The Company recorded a foreign exchange loss of $9,000 in the fourth quarter of 2012, similar to that realized in the fourth quarter of 2011.
The net loss and comprehensive loss for the fourth quarter of 2012 was $6.3 million, or ($0.016) per share, versus a net loss and comprehensive loss of $3.6 million, or ($0.01) per share, for the same period last year. The increased loss per share is primarily due to the increase in the net loss and comprehensive loss in the fourth quarter of 2012 versus the fourth quarter of 2011 due to higher operating costs, partially offset by the higher average number of shares outstanding in the fourth quarter of 2012 compared to the fourth quarter of 2011.
Full Year 2012 Financial Results in Canadian Dollars
Revenues for 2012 were $2,000, a reduction of $3.1 million versus 2011. Research collaboration and contract revenues decreased by $0.8 million as the research component of the Otsuka agreement ended on June 30, 2011 and the license and up-front fees decreased by $2.3 million as we amortized the remaining deferred revenues under the Otsuka and Taiho agreements in 2011.
Research and development expenditures, net of investment tax credits, for 2012 were $15.1 million, or $6.2 million higher than in 2011. This increase was driven by higher compensation costs relating to strengthening the clinical development department with the addition of key senior management, and higher third-party clinical development costs relating to our lead programs MGCD290 and MGCD265 in 2012 as compared to 2011. The increased expenses were partially offset by a $0.8 million increase in investment tax credits relating to the reversal of an accrual in 2012.
General and administrative expenses in 2012 were $5.4 million, a $1.1 million increase over 2011, primarily as a result of the departure of the previous CEO and higher non-cash stock option expenses, partially offset by lower lease related costs.
Financial income, relating primarily to interest income, was $241,000 for 2012, a decrease of $21,000 versus 2011 due to lower average cash assets versus the prior year. The Company recorded a foreign exchange loss of $13,000 in 2012 compared to a gain of $42,000 in 2011.
The net loss and comprehensive loss for 2012 was $20.3 million, or ($0.06) per share, versus a net loss and comprehensive loss of $9.7 million, or ($0.04) per share, for 2011. The increased loss per share relates to the increased net loss and comprehensive loss in 2012 due to the reduced revenues and higher operating costs partially offset by the higher average number of shares outstanding in 2012.
Cash, cash equivalents, marketable securities and restricted cash totalled $37.2 million as at December 31, 2012 compared to $29.6 million as at December 31, 2011. The Company believes that based on its current clinical plan that it has sufficient financial resources to carry forward its current clinical development and operating plans into the second half of 2014.
MethylGene Inc. (TSX:MYG) is a drug development company that is advancing novel therapeutics for cancer and infectious disease in human clinical trials. The Company’s lead product candidates are: MGCD290, an oral antifungal agent targeting the fungal Hos2 enzyme that is in a Phase II trial for vulvovaginal candidiasis, and MGCD265, a multi-targeted receptor tyrosine kinase inhibitor that is in Phase I/II clinical trials for patients with solid tumors. MethylGene owns all rights to its lead product candidates, and has partnerships with Otsuka Pharmaceutical Co. Ltd., Taiho Pharmaceutical Co. Ltd., and EnVivo Pharmaceuticals, Inc. for its other pipeline programs.
Investor Relations Contact:
Joseph Walewicz, CFA
Vice President, Business & Corporate Development
Phone: 514-337-3333 ext. 373
The Trout Group LLC