OncoGenex Pharmaceuticals Inc. Reports Second Quarter and First-Half 2012 Financial Results and Reviews Clinical Development Highlights for Custirsen and OGX-427

BOTHELL, Wash. and VANCOUVER, British Columbia, Aug. 2, 2012 /PRNewswire/ -- OncoGenex Pharmaceuticals, Inc. (NASDAQ: OGXI) today announced financial results for its second quarter and six months ended June 30, 2012 and provided an overview of the clinical development activities of its two product candidates, custirsen and OGX-427.

Custirsen Clinical Development Highlights

• The Company announced detailed plans for the ENSPIRIT trial, an international, randomized Phase 3 study in approximately 1,100 patients with advanced or metastatic non-small cell lung cancer (NSCLC). The trial will evaluate the potential survival benefit of combining custirsen with docetaxel as a second-line treatment in patients who have progressed after initial chemotherapy treatment has failed. Enrollment is planned to begin later this year and the trial will be managed by our development partner for custirsen, Teva Pharmaceuticals Industries LTD (TEVA).
• Custirsen's primary registration Phase 3 study, SYNERGY, evaluating a survival benefit for custirsen plus first-line chemotherapy in patients with castrate-resistant prostate cancer (CRPC), remains on schedule and patient accrual is expected to be completed in the second half of 2012.
• The Phase 3 AFFINITY study, evaluating a survival benefit for custirsen in combination with Jevtana® (cabazitaxel) as second-line chemotherapy in patients with CPRC, is expected to begin patient enrollment in the near future.

OGX-427 Clinical Development Highlights

• Preliminary data from an investigator-sponsored Phase 2 clinical trial of OGX-427 in chemotherapy-naive patients with metastatic CRPC were presented at the American Society of Clinical Oncology (ASCO) Annual Meeting in June 2012. Preliminary study results showed a higher number of patients without disease progression at 12 weeks and greater declines in prostate-specific antigen (PSA) and circulating tumor cells (CTC) with OGX-427 plus prednisone treatment compared to prednisone alone. The study has recently completed enrollment at 74 patients.
• The randomized, Phase 2 clinical trial of OGX-427 in patients with metastatic bladder cancer continues patient accrual, with sites throughout North America and Europe. The trial aims to enroll approximately 180 patients and will evaluate the overall survival benefit of OGX-427 in combination with gemcitabine and cisplatin.
• An investigator-sponsored, randomized Phase 2 study evaluating OGX-427 in combination with Zytiga® (abiraterone acetate) in patients with CRPC is expected to be initiated in the second half of 2012.
• Additional Phase 2 investigator-sponsored studies evaluating OGX-427 in other malignancies are under development. Further details of these studies will be provided when the trials are initiated. Results of these studies may direct future company-sponsored trials in indications that show promising clinical benefits.

Second Quarter and First-Half 2012 Financial Update and Results

• Revenue for the second quarter and six months ended June 30, 2012 increased to $2.4 million and $3.7 million, respectively, compared with $1.9 million and $3.1 million, respectively, in the same periods in 2011. The increase in 2012 as compared to 2011 was due to higher revenue earned through our strategic collaboration with Teva, resulting from clinical development activities associated with the AFFINITY trial.
• As of June 30, 2012, $15.4 million of the $30 million advanced reimbursement received from Teva in December 2009 was included on our Balance Sheet as Current Deferred Collaboration Revenue. This advance reimbursement balance will continue to be reduced as we incur direct and indirect custirsen development costs. As a consequence of initiating the AFFINITY trial later this year, we presently expect that all remaining Current Deferred Collaboration Revenue will be recognized as Collaboration Revenue by the fourth quarter of 2012. Once the remaining amount of the advanced reimbursement from Teva has been drawn to zero, all of our costs associated with the clinical programs under our collaboration will be reimbursed by Teva quarterly.
• Total operating expenses for the second quarter and six months ended June 30, 2012 increased to $8.4 million and $15.2 million, respectively, compared with $6.9 million and $13.3 million, respectively, in the same periods in 2011. The increase in 2012 as compared to 2011 was due primarily to higher clinical study expenses associated with patient enrollment in our clinical trial evaluating OGX-427 in patients with metastatic bladder cancer, the startup of the AFFINITY trial and higher employee expenses, including stock based compensation expenses. These increases were partially offset by lower manufacturing costs related to timing of OGX-427 manufacturing runs.
• Net loss for the second quarter and six months ended June 30, 2012 was $4.2 million, or $0.29 per diluted common share, and $11.1 million, or $0.89 per diluted common share, respectively. This is compared with a net loss for the second quarter and six months ended June 30, 2011 of $6.5 million, or $0.67 per diluted common share, and $9.6 million, or $0.99 per diluted common share, respectively. The net loss in the three months ended June 30, 2012 included a $1.6 million non-cash gain on revaluation of our warrant liability compared to a $1.7 million non-cash loss on revaluation of our warrant liability in the three months ended June 30, 2011.
• We had $97.6 million in cash, cash equivalents and short-term investments as of June 30, 2012, compared to $64.9 million as of December 31, 2011.
• 2012 cash guidance:
  • Net cash requirements are expected to be in the range of $45 million to $50 million.
  • Year-end cash, cash equivalents, investments and receivables from Teva are expected to be in the range of $68 million to $73 million and include the receipt of proceeds from our March offering of common stock.
• Based on our current expectations, we believe our capital resources as of June 30, 2012 will be sufficient to fund our currently planned operations into 2015.
• At July 30, 2012, we had 14,573,507 shares outstanding.