Ablynx Announces Q1 2012 Business Update

GHENT, BELGIUM--(Marketwire - May 16, 2012) -

REGULATED INFORMATION

GHENT, Belgium, 16(th) May 2012 - Ablynx [Euronext Brussels: ABLX], the Belgian- based biopharmaceutical company focused on the discovery and development of Nanobodies® for the treatment of serious life-threatening diseases, today announced its business update for the three-month period ending 31(st) March 2012.

Operating highlights

* Seven Nanobody-based assets in clinical development across multiple
  disease areas
* Second pre-clinical candidate selected as part of the Strategic Alliance
  with Boehringer Ingelheim, triggering a EUR5 million milestone
* Strategic Alliance with Boehringer Ingelheim extended for two years to
  September 2014, worth an extra EUR6.6 million to Ablynx
* Management team strengthened with the appointment of Dr Andreas Menrad,
  Chief Scientific Officer
* Extended GMP certificate granted for new GMP unit

Financial highlights

  * Revenues up 159% to EUR10.1 million
  * Net result for the period improved by 55% to -EUR6.2 million
  * Positive net cash flow of EUR1.3 million
  * Strong financial position with EUR85.1 million in cash at period end
    including, cash, cash equivalents, restricted cash and short-term
    investments

Commenting on today's update, Dr Edwin Moses, Chairman and CEO of Ablynx, said:

"We have had an excellent start to the year and we are seeing good progress on a number of fronts. Perhaps the most significant news occurred after the period end, when Novartis presented data at the AACR conference in Chicago in April that demonstrated that a Nanobody, TAS266, was able to elicit superior anti-tumour efficacy compared to conventional monoclonal antibodies, which is a major endorsement for our whole Nanobody approach. An IND has been filed by Novartis for TAS266 and a Phase I trial is expected to start imminently. We also made strong progress in the clinic in the first quarter, with six wholly-owned programmes in clinical development and the first programme partnered with Boerhinger Ingelheim advancing well towards the clinic."

"We were very pleased to welcome Dr Andreas Menrad as our Chief Scientific Officer in March. We ended the period in a strong financial position with positive net cash flow for the quarter and EUR85 million in cash and cash equivalents at the period end. The Company is making strong progress during 2012 and we expect further news of developments in our partnered and proprietary product pipeline, as well as additional collaborations and milestones."

Financial review

+------------------------------------------+---------+---------+----------+
| (EUR million)                            | Q1 2012 | Q1 2011 | % change |
+----------------------------------------------+

---------+---------+----------+
| Revenues                                 | 10.1    | 3.9     | 159%     |

+---------------------------------------- -+---------+---------+----------+
|                           R&D income     | 9.7     | 3.4     | 185%     |
+------------------------------------------+

---------+---------+----------+
|                           Grants         | 0.3     | 0.5     | (40%)    |

+------------------------------------------+---------+---------+----------+
| Operating expenses                       | 16.7    | 18.1    | (8%)     |
+------------------------------------------+

---------+---------+----------+
|                           R&D            | 14.4    | 15.9    | (9%)     |

+------------------------------------------+---------+---------+----------+
|                           G&A            | 2.3     | 2.2     | 5%       |
+------------------------------------------+

---------+---------+----------+
| Operating result                         | (6.7)   | (14.2)  | 53%      |

+------------------------------------------+---------+---------+----------+
| Finance income (net)                     | 0.4     | 0.4     | 0%       |
+------------------------------------------+

---------+---------+----------+
| Net result                               | (6.2)   | (13.8)  | 55%      |

+------------------------------------------+---------+---------+----------+
|                                                              |          |
+------------------------------------------+

---------+---------+----------+
| Cash flow                                | 1.3     | (8.6)   | 115%     |

+------------------------------------------+---------+---------+----------+
| Cash at 31(st) March( (1))               | 85.1    | 107.3   | (21%)    |
+------------------------------------------+

---------+---------+----------+

((1) )including EUR3 million restricted cash

Revenues increased 159% to EUR10.1 million (2011: EUR3.9 million) mainly driven by the milestone payment from Boehringer Ingelheim and recognised income from the upfront fee of the third co-discovery co-development deal signed with Merck Serono in November 2011. Operating expenses decreased 8% to EUR16.7 million (2011: EUR18.1 million) due to lower R&D expenses mainly as a result of re-focusing of resources within the product pipeline. As a result of the above, the Company had a positive net cash inflow of EUR1.3 million (2011: cash burn of -EUR8.6 million), and the loss for the period was reduced by 55% to EUR6.2 million (2011: EUR13.8 million).

Operational review

During the past three months, Ablynx continued to focus on its most advanced clinical assets ALX-0081/ALX-0681, currently in Phase II for the treatment of TTP; ALX-0061 currently in Phase II in patients with RA; and the anti-RSV Nanobody ALX-0171, currently in Phase I. As a result of a strategic review, it was decided not to pursue with ALX-0651 (anti-CXCR4) beyond Phase I. Business development activities continued for ATN-103 (anti-TNFα; POC achieved) and ALX-0141 (anti-RANKL; Phase I successfully completed) as both these programmes require a partner to take them to the next stage of clinical development. The Strategic Alliance with Boehringer Ingelheim advanced further with the Company selecting a second Nanobody for pre-clinical development in oncology, which triggered a EUR5 million milestone payment. In addition, this Strategic Alliance with Boehringer Ingelheim was extended for two years, running to September 2014. The extension will provide Ablynx with an extra EUR6.6 million in additional research funding. Finally, during the past quarter, Ablynx appointed Dr Andreas Menrad as Chief Scientific Officer and received an extended GMP certificate for its new GMP unit.

Important events after 31(st) March 2012 and outlook for the remainder of 2012

On 2(nd) April 2012, Ablynx announced that Novartis had received IND approval for a novel tetrameric Nanobody agonist, TAS266, targeting DR5, a key receptor target on cancer cells across a number of tumour types. The event triggered a EUR0.4 million milestone payment to Ablynx. On 3(rd) April, Novartis presented pre-clinical data for TAS266 at the AACR conference in Chicago, which demonstrated that the Nanobody can elicit superior anti-tumour efficacy compared to conventional antibodies. The ability of TAS266 to efficiently ' cross-link' DR5 receptor targets, apparently not achievable with conventional monoclonal antibodies, results in the controlled death of cancer cells.

On 25(th) April 2012, Ablynx reported that its partner Boehringer Ingelheim had submitted a CTA to the European regulatory authorities to start a Phase I clinical trial with a Nanobody for the treatment of Alzheimer's disease. The event triggered a EUR1 million milestone payment to Ablynx.

Before year end, Ablynx expects potential proof-of-concept from the ongoing Phase II study with ALX-0061 in RA patients and Phase I data for the anti-RSV Nanobody ALX-0171. The results from the open label extension of the Phase II study with the anti-TNFα Nanobody, ATN-103, are anticipated in the coming months. The results will provide additional efficacy and safety data on monthly treatment with ATN-103 in patients with RA for up to 48 weeks.Both Novartis and Boehringer Ingelheim are also expected to enter the clinic with Nanobody-based products in 2012. In addition, Ablynx expect to establish new partnerships for target-based programmes and/or (pre-)clinical assets. Strong cash management will remain of key importance and the net cash burn target for 2012 remains in the range of EUR20-25 million.

About Ablynx

Ablynx is a biopharmaceutical company engaged in the discovery and development of Nanobodies(®), a novel class of therapeutic proteins based on single-domain antibody fragments, for a range of serious and life-threatening human diseases, including inflammation, haematology, oncology and pulmonary disease. Today, the Company has over 25 programmes in the pipeline and seven Nanobodies at clinical development stage. Ablynx has ongoing research collaborations and significant partnerships with major pharmaceutical companies, including Boehringer Ingelheim, Merck Serono, and Novartis. The Company is headquartered in Ghent, Belgium. More information can be found on www.ablynx.com.

Complete version of the press release: http://hugin.info/137912/R/1612942/513582.pdf

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Source: Ablynx via Thomson Reuters ONE [HUG#1612942]