Montreal, Canada. May 14, 2012 – MethylGene Inc. (TSX: MYG) today reported financial results for the first quarter ended March 31, 2012 and provided an update on clinical programs.
• Rachel W. Humphrey, MD was appointed as Executive Vice President and Chief Medical Officer on January 4, 2012
• During this quarter, we strengthened our Board of Directors with the appointments of Henry J. Fuchs MD and Peggy Mulligan FCA
• Our MGCD290 Phase II clinical trial and MGCD265 Phase I/II clinical trials continued to enroll patients.
• Preclinical data from our MGCD265 oncology program was presented at the American Association for Cancer Research Annual Meeting.
• In May 2012, we opened our US office in Princeton, New Jersey.
• We finished the quarter with $25.1 million in cash and cash equivalents.
“MethylGene continued to make solid progress in this quarter,” said Charles Grubsztajn, President and CEO of MethylGene. “The clinical programs for both MGCD290 and MGCD265 continue to progress, and we made key additions to our management team and Board of Directors to ensure that we have the optimal balance of skills and experience to lead us through the next steps.”
First Quarter 2012 Financial Results Reported in Canadian Dollars
The Company’s financial statements for the period ended March 31, 2012 have been prepared in accordance with IAS 34, Interim Financial Reporting, as issued by the International Accounting Standards Board (IASB).
We had minimal revenues in the first quarter ended March 31, 2012 compared to $1.3 million for the first quarter of 2011, as the research component of the agreement with Otsuka Pharmaceutical Co. Ltd. ended in June 2011 and we had fully amortized the remaining deferred revenues for both Otsuka and Taiho Pharmaceutical Co. Ltd. in the second and fourth quarters of 2011, respectively.
Research and development expenditures, net of investment tax credits, for the first quarter of 2012 were $2.2 million compared to $1.8 million for the first quarter of 2011. This increase is due to increased clinical development activity with both the MGCD290 and MGCD265 programs, increased compensation costs with the appointment of the Chief Medical Officer and was partly offset by higher investment tax credits.
General and administrative expenses in the first quarter of 2012 were $1.2 million compared to $1.0 million in the first quarter of 2011. This primarily relates to higher non-cash stock option expenses.
Financial income of $69,000, relating primarily to interest income, in the first quarter of 2012 was $62,000 higher compared to the first quarter of 2011 due to increased cash balances versus the prior year. The Company recorded a foreign exchange gain of nil in the first quarter of 2012 compared to a loss of $11,000 in the first quarter of 2011.
The net loss and comprehensive loss for the first quarter ended March 31, 2012 was $3.4 million, or ($0.01) per share, compared to a net loss and comprehensive loss of $1.6 million, or ($0.04) per share, for the same period last year. The decreased loss per share relates to the higher number of shares outstanding at the end of the first quarter 2012 versus the first quarter of 2011.
Cash, cash equivalents, marketable securities and restricted cash totaled $25.1 million as at March 31, 2012 compared to $29.6 million on December 31, 2011. The Company believes it has sufficient financial resources to carry forward its current clinical development and operating plans into the fourth quarter of 2013.
MGCD290 Clinical Development Update
MGCD290 is a first-in-class, selective, oral small molecule inhibitor of the fungal enzyme Hos2, initially being developed in combination with fluconazole, the most widely used triazole antifungal. We recently commenced a randomized controlled phase II trial of MGCD290 in moderate to severe acute vulvovaginal candidiasis (VVC), a form of yeast infection for which there is only limited response from standard treatments. This trial will assess the effectiveness of MGCD290 in combination with fluconazole, as compared to fluconazole alone. Initially, a higher than expected number of patients were ineligible at screening, leading us to amend the protocol and add additional sites in order to accelerate recruitment. We expect that most of the new sites will be open under the new protocol this quarter. We continue to expect to report topline data from this trial around year end 2012. We are also planning to initiate a second randomized trial in VVC. We completed a fifth phase I study in the first quarter of 2012 to assess the effect of food on MGCD290 bioavailability, as well as to evaluate its distribution to clinically relevant tissues. The study has been completed and no serious adverse events were reported. The data suggest food increased exposure and that MGCD290 was present in clinically relevant tissues. The data from this trial will be used to guide future studies.
MGCD265 Clinical Development Update
MGCD265 is a rationally designed, orally available kinase inhibitor targeting a unique spectrum of RTKs including Met, VEGFR 1, 2, and 3, RON and Tie-2. We continue to enroll patients in MGCD265 phase I/II monotherapy trials and combination trials with erlotinib or docetaxel and as of April 30, 2012 over 198 patients have been treated in these trials. We also recently completed a food effect study with MGCD265. Preliminary results from this study suggest that combining MGCD265 with food improves exposure to the drug and we have incorporated this into our ongoing trials. Our development plan for MGCD265 is to expand the monotherapy and combination therapy trials with selected cohorts of tumor types once the maximum tolerated dose is reached. The data from the expansion cohorts will be used to guide randomized phase II studies.
MethylGene Inc. (TSX:MYG) is a small molecule drug development company that is advancing two 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 currently in Phase II trials for vulvovaginal candidiasis and MGCD265, an oral Met/VEGF receptor kinase inhibitor that is in Phase I/II clinical trials for solid tumor cancers. 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.
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