Tengion (TNGN) Q2/12 Results
Adjusted net loss of $4.5M, or $1.89 per share
Adjusted net loss of $4.5M or $1.89 per share, compared with an adjusted net loss of $6.6M, or $2.81 per share for Q2/11.
In Q2/12, R&D expenses were $2.78M, G&A was $1.43M, depreciation was $415K and other expense was $4K for a total loss from operations was $4.38M in Q2/12 as compared to Q2/11’s R&D expenses were $3.39M, G&A was $2.03M, depreciation was $938K and other expense was $27K for a total loss from operations was $6.43M. The net income loss was $23.319M compared to $2.89M in Q2/11 due mainly to the change in fair value of warrant liability <%9.5M versus $1.21M in Q2/11>. Basic shares used in computing the net loss were 2.373M in Q2/12 versus 2.349M in Q2/11.
- As of 6/30/12, held $3.7M in cash and cash equivalents
Notes:
- Based upon the Company’s currently expected level of operating expenditures and debt repayments, and assuming it is not required to settle any outstanding warrants in cash, TNGN expects to be able to fund its operations through 8/31/12. Tengion is actively exploring opportunities to continue its business operations as currently conducted and fund deficits in operating cash flows. If TNGN is unable to raise additional capital, it will need to suspend its business operations and will likely need to seek protection under US bankruptcy laws;
- In 5/12, TNGN’s Board of Directors approved a reverse split of its common stock at a ratio of 1-for-10. The common stock began trading on a split-adjusted basis upon the opening of the NASDAQ on 6/14/12. The reverse split reduced the number of outstanding shares to approximately 2.5M shares.
6 Month Review:
An adjusted net loss of $8.9M, or $3.74 per basic and diluted common share, compared to an adjusted net loss of $13.1M, or $6.79 per basic and diluted common share, for the same period in 2011. The decreased adjusted net loss for the 2012 period was primarily due to a reduction in compensation and related expenses of $2.5M and a decrease in depreciation expense of $1.8M. The decreased compensation-related expenses during the 2012 period, of which $1.2 million were attributable to R&D personnel and $1.3 M, were attributable to general and administrative personnel were primarily due to lower headcount resulting from the 11/11 restructuring. The decreased depreciation expense during the 2012 period resulted from both a change during Q2/11 in the estimated useful life of leasehold improvements at the leased facility in Winston-Salem, North Carolina and an impairment during Q4/11 of the carrying value of the leased facility in East Norriton, Pennsylvania. The decreased adjusted net loss for the 2012 period was primarily due to a reduction in compensation and related expenses of $1.6M and a decrease in depreciation expense of $0.9M.
Q2/12 Highlights:
- Tengion has implanted 5 patients in the ongoing P1 clinical trial of its most advanced product candidate, the Neo-Urinary Conduit, for use in bladder cancer patients requiring a urinary diversion following bladder removal (cystectomy). The trial is designed to translate the surgical procedure successfully used in preclinical animal models into clinical trials with human patients while assessing the safety and preliminary efficacy of the Neo-Urinary Conduit. The trial is an open-label, single-arm study, which is currently expected to enroll up to ten patients. Following a positive meeting with the Data Safety Monitoring Board (DSMB), TNGN is now actively recruiting in order to proceed with concurrent enrollment of patients six and seven as soon as possible. Assuming appropriate safety data, TNGN anticipates commencement of efforts to enroll an additional three patients approximately six weeks after implant of patients six and seven, thereby allowing the achievement of its stated objective of completing implantation of up to 10 patients by the end of 2012.The trial is currently being conducted at the University of Chicago Medical Center and at The Johns Hopkins Hospital in Baltimore, Maryland. In addition to the two original trial sites, the trial has been expanded to include four additional centers for patients seven through ten. The additional trial sites are Memorial Sloan-Kettering Cancer Center in New York, NY; Baylor College of Medicine, Houston, Texas; University of Michigan Comprehensive Cancer Center in Ann Arbor, MI; and a fourth site in Boston, MA;
- Tengion’s lead preclinical program, the Neo-Kidney Augment, is intended to prevent or delay the need for dialysis or kidney transplant by catalyzing the regeneration of functional kidney tissue in patients with advanced chronic kidney disease (CKD). Tengion scientists have published and presented positive data on the effect of the Neo-Kidney Augment in 4 different preclinical models of CKD. TNGN has commenced the good laboratory practice (GLP) animal study program required by the FDA to support an IND filing and initiation of a P1 clinical trial in CKD patients. These GLP studies are consistent with the pre-clinical animal models already conducted, which yielded positive data demonstrating slowing of kidney disease progression and improved survival. Tengion anticipates that it will submit an IND filing for the Neo-Kidney Augment during the first half of 2013 and that its P1 trial will provide initial human proof-of-concept data in 2014. TNGN is also exploring an entry strategy in Europe for its Neo-Kidney Augment product candidate using the Advanced Therapy Medicinal Products (ATMP) pathway, an established regulatory route in Europe for advanced cell-based therapies. Tengion plans to define the European regulatory pathway for Neo-Kidney Augment program in the second half of 2012.
