YM BioSciences Reports Operational and Financial Results for the
Third Quarter of Fiscal 2012
MISSISSAUGA, Canada, May 11, 2012 – YM BioSciences Inc. (NYSE Amex: YMI, TSX: YM), a drug development company advancing a diverse portfolio of hematology and cancer related products, today reported operational and financial results for its third quarter of fiscal 2012, ended March 31, 2012.
“In the past few months we delivered robust Phase I/II results for our JAK1/JAK2 inhibitor, CYT387, in patients with myelofibrosis and we raised an additional $80 million principally to support the further advancement of this drug,” said Dr. Nick Glover, President and CEO of YM BioSciences. “Our current focus is on confirming our Phase III clinical strategy for CYT387 with both North American and European regulators with the expectation that, subject to these regulatory discussions, we will begin enrolling patients in pivotal trials in the second half of calendar 2012.”
CYT387 Next Steps:
| · | Subject to regulatory clearance, pivotal trials for CYT387 in myelofibrosis are targeted to begin in the second half of calendar 2012. |
| · | Final nine-month data from the ongoing 166-patient Phase I/II Core trial are expected to be reported by the end of calendar 2012. |
| · | Interim data from the Phase I/II Extension trial, in which patients who have completed the Core trial are able to continue long-term treatment with CYT387, are expected to be reported by the end of calendar 2012. |
| · | Interim data from the BID (twice-daily dosing) Phase II trial of CYT387 are expected to be reported by the end of calendar 2012. |
| · | YM may evaluate CYT387’s effectiveness in additional clinical indications and is currently in the process of designing clinical trials for these indications. |
| · | YM will entertain strategic discussions with other companies for the next stages of development for CYT387 and will weigh any opportunities against the prospect of retaining full commercial economics by advancing CYT387 further into pivotal trials on its own. |
Financial Results (CDN dollars)
The interim consolidated financial statements and comparative information for the third quarter of fiscal 2012 have been prepared in accordance with International Financial Reporting Standards (“IFRS”). Previously, up to June 30, 2011, the Company prepared its Interim and Annual Consolidated Financial Statements in accordance with Canadian Generally Accepted Accounting Principles (“Canadian GAAP”).
Revenue, primarily from out-licensing, for the third quarter of fiscal 2012 ended March 31, 2012, was $0.1 million compared with $0.2 million for the third quarter of fiscal 2011. Revenue from out-licensing for the first nine months of fiscal 2012 was $0.7 million compared with $0.8 million for the first nine months of fiscal 2011.The decreases were due to a two-year increase in the period over which the deferred revenue is being recognized.
Net finance income was $0.3 million for the third quarter of fiscal 2012 compared to net finance costs of $1.5 million for the third quarter of fiscal 2011. Net finance income was $9.3 million for the first nine months of fiscal 2012 compared to net finance costs of $9.8 million for the first nine months of fiscal 2011. The changes in net finance income are primarily attributable to changes in the fair value adjustment for USD warrants. Under IFRS, warrants denominated in a different currency than the Company’s functional currency must be classified as a financial liability and measured at fair value, with changes reflected in profit or loss. For the third quarter of fiscal 2012, the Company incurred a loss of $0.4 million on the revaluation of warrants, compared to a loss of $1.1 million for the third quarter of fiscal 2011. For the first nine months of fiscal 2012, the Company incurred a gain of $6.8 million on the revaluation of warrants, compared to a loss of $8.6 million for the first nine months of fiscal 2011.
Licensing and product development expenses were $5.8 million for the third quarter of fiscal 2012 compared with $5.5 million for the third quarter of fiscal 2011. Licensing and product development expenses were $19.5 million for the first nine months of fiscal 2012 compared with $16.4 million for the first nine months of fiscal 2011. For the third quarter of fiscal 2012, core expenses for licensing and product development remained constant at $3.0 million compared to the three months ended March 31, 2011, costs associated with development activities for CYT387 increased by $1.0 million to $2.5 million, and costs associated with development activities for nimotuzumab decreased by $0.7 million to $0.2 million. Development expenses for CYT387 increased due to the expansion of the Phase I/II clinical trial in myelofibrosis, start-up costs associated with the BID (twice-daily dosing) study, pre-clinical development activities, and manufacturing of drug for these programs.
General and administrative expenses were $1.4 million for the third quarter of fiscal 2012 compared to $1.6 million for the third quarter of fiscal 2011. General and administrative expenses were $4.7 million for the first nine months of fiscal 2012 compared to $6.6 million for the first nine months of fiscal 2011, primarily due to severance and restructuring costs incurred in fiscal 2011.
Net loss for the third quarter of fiscal 2012 was $6.8 million ($0.05 per share) compared to $8.3 million ($0.08 per share) for the same period last fiscal year. Net loss for the first nine months of fiscal 2012 was $14.2 million ($0.12 per share) compared to $32.0 million ($0.35 per share) for the same period last fiscal year. Under IFRS, net loss has been volatile, caused by the requirement to adjust the carrying value of liabilities such as USD warrants and stock appreciation rights to fair value at each measurement date, with changes being reflected in net loss for the quarter.
During the third quarter of fiscal 2012, the Company completed a prospectus offering of 40,250,000 shares for gross proceeds of $79.4 million (U.S. $80.5 million) resulting in a net cash proceeds of $74.2 million.
As at March 31, 2012 the Company had cash and short-term deposits totaling $137.2 million and accounts payables and accrued liabilities totaling $3.1 million compared to $79.7 million and $4.4 million respectively at June 30, 2011.
As at March 31, 2012 the Company had 157,402,353 common shares and 7,366,418 warrants outstanding.
About YM BioSciences
YM BioSciences Inc. is a drug development company primarily focused on advancing CYT387, an orally administered inhibitor of both the JAK1 and JAK2 kinases, which have been implicated in a number of immune cell disorders including myeloproliferative neoplasms and inflammatory diseases as well as certain cancers. Positive interim results have been reported from a Phase I/II trial of CYT387 in 166 patients with myelofibrosis. This trial has completed enrollment while a 60 patient Phase II twice-daily dose escalation trial is currently recruiting patients. YM’s portfolio also includes nimotuzumab, a humanized monoclonal antibody targeting EGFR with an enhanced side-effect profile over currently marketed EGFR-targeting antibodies. Nimotuzumab is being evaluated in numerous Phase II and III trials worldwide. CYT997 is an orally-available small molecule therapeutic with dual mechanisms of vascular disruption and cytotoxicity, and has completed a Phase II trial in glioblastoma multiforme. In addition to YM’s three products, the Company has several preclinical research programs underway with candidates from its library of novel compounds identified through internal research conducted at YM BioSciences Australia.
This press release may contain forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such factors include, but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process or the ability to obtain drug product in sufficient quantity or at standards acceptable to health regulatory authorities to complete clinical trials or to meet commercial demand; and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting. Certain of the assumptions made in preparing forward-looking statements include but are not limited to the following: that CYT387, nimotuzumab and CYT997 will generate positive efficacy and safety data in ongoing and future clinical trials, and that YM and its various licensees will complete their respective clinical trials and disclose data within the timelines communicated in this release. Except as required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Enquiries:
James Smith
VP Corporate Communications
YM BioSciences Inc.
Tel. +1 905.361.9518
jsmith@ymbiosciences.com
ym biosciences inc.
Condensed Consolidated Interim Statements of Financial Position
(Expressed in Canadian dollars, unless otherwise noted)
(Unaudited)
| March 31, | June 30, | July 1, | ||||||||||
| 2012 | 2011 | 2010 | ||||||||||
| Assets | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | $ | 90,830,767 | $ | 32,046,630 | $ | 19,460,141 | ||||||
| Short-term deposits | 46,362,847 | 47,611,922 | 26,184,991 | |||||||||
| Accounts receivable | 248,738 | 205,900 | 161,184 | |||||||||
| Prepaid expenses | 428,114 | 731,676 | 237,962 | |||||||||
| Total current assets | 137,870,466 | 80,596,128 | 46,044,278 | |||||||||
| Non-current assets: | ||||||||||||
| Property and equipment | 62,157 | 91,320 | 84,775 | |||||||||
| Intangible assets | 3,756,686 | 7,137,698 | 11,645,714 | |||||||||
| Total non-current assets | 3,818,843 | 7,229,018 | 11,730,489 | |||||||||
| Total assets | $ | 141,689,309 | $ | 87,825,146 | $ | 57,774,767 | ||||||
| Liabilities and Equity | ||||||||||||
| Current liabilities: | ||||||||||||
| Accounts payable | $ | 1,287,062 | $ | 1,718,893 | $ | 699,277 | ||||||
| Accrued liabilities | 1,783,598 | 2,652,511 | 2,085,824 | |||||||||
| Share purchase warrants | 7,630,176 | 14,476,681 | 6,358,480 | |||||||||
| Deferred revenue | 381,270 | 594,072 | 1,523,916 | |||||||||
| Total current liabilities | 11,082,106 | 19,442,157 | 10,667,497 | |||||||||
| Non-current liabilities: | ||||||||||||
| Deferred revenue | 1,652,170 | 1,831,722 | 1,650,909 | |||||||||
| Total non-current liabilities | 1,652,170 | 1,831,722 | 1,650,909 | |||||||||
| Equity: | ||||||||||||
| Share capital | 339,867,098 | 264,548,643 | 203,498,239 | |||||||||
| Contributed surplus | 16,478,999 | 15,144,062 | 14,232,353 | |||||||||
| Deficit | (227,391,064 | ) | (213,141,438 | ) | (172,274,231 | ) | ||||||
| Total equity | 128,955,033 | 66,551,267 | 45,456,361 | |||||||||
| Total liabilities and equity | $ | 141,689,309 | $ | 87,825,146 | $ | 57,774,767 | ||||||
Approved by the Board and authorized for issue on May 10, 2012:
| "Tryon Williams" | Director | |
| "David G.P. Allan" | Director | |
ym biosciences inc.
Condensed Consolidated Interim Statements of Comprehensive Income
(Expressed in Canadian dollars, unless otherwise noted)
(Unaudited)
| Three months ended | Nine months ended | |||||||||||||||
| March 31, | March 31, | |||||||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||||||
| Revenue: | ||||||||||||||||
| Out-licensing | $ | 109,107 | $ | 217,489 | $ | 739,952 | $ | 811,262 | ||||||||
| Expenses: | ||||||||||||||||
| Licensing and product development | 5,755,426 | 5,493,790 | 19,503,754 | 16,432,545 | ||||||||||||
| General and administrative | 1,433,113 | 1,606,297 | 4,748,144 | 6,560,907 | ||||||||||||
| 7,188,539 | 7,100,087 | 24,251,898 | 22,993,452 | |||||||||||||
| Loss before the undernoted | (7,079,432 | ) | (6,882,598 | ) | (23,511,946 | ) | (22,182,190 | ) | ||||||||
| Finance income | 699,990 | 170,437 | 9,262,320 | 319,935 | ||||||||||||
| Finance costs | (417,716 | ) | (1,642,363 | ) | – | (10,140,698 | ) | |||||||||
| Other income | – | 9,528 | – | 34,444 | ||||||||||||
| Net loss for the period and comprehensive loss | $ | (6,797,158 | ) | $ | (8,344,996 | ) | $ | (14,249,626 | ) | $ | (31,968,509 | ) | ||||
| Basic and diluted loss per common share | $ | (0.05 | ) | $ | (0.08 | ) | $ | (0.12 | ) | $ | (0.35 | ) | ||||
ym biosciences inc.
Condensed Consolidated Interim Statements of Changes in Equity
(Expressed in Canadian dollars, unless otherwise noted)
(Unaudited)
| Share capital | Contributed | |||||||||||||||||||
| Number | Amount | surplus | Deficit | Total | ||||||||||||||||
| Balance, June 30, 2011 | 116,681,948 | $ | 264,548,643 | $ | 15,144,062 | $ | (213,141,438 | ) | $ | 66,551,267 | ||||||||||
| Net loss for the period | – | – | – | (14,249,626 | ) | (14,249,626 | ) | |||||||||||||
| Transactions with owners of the Company, recognized directly in equity: | ||||||||||||||||||||
| Shares issued pursuant to prospectus offering | 40,250,000 | 74,232,207 | – | – | 74,232,207 | |||||||||||||||
| Share-based compensation | – | – | 1,880,899 | – | 1,880,899 | |||||||||||||||
| Shares issued on exercise of options | 470,405 | 1,086,248 | (545,962 | ) | – | 540,286 | ||||||||||||||
| Total transactions with owners of the Company | 40,720,405 | 75,318,455 | 1,334,937 | – | 76,653,392 | |||||||||||||||
| Balance, March 31, 2012 | 157,402,353 | $ | 339,867,098 | $ | 16,478,999 | $ | (227,391,064 | ) | $ | 128,955,033 | ||||||||||
| Share capital | Contributed | |||||||||||||||||||
| Number | Amount | surplus | Deficit | Total | ||||||||||||||||
| Balance, July 1, 2010 | 80,359,623 | $ | 203,498,239 | $ | 14,232,353 | $ | (172,274,231 | ) | $ | 45,456,361 | ||||||||||
| Net loss for the period | – | – | – | (31,968,509 | ) | (31,968,509 | ) | |||||||||||||
| Transactions with owners of the Company, recognized directly in equity: | ||||||||||||||||||||
| Share-based compensation | – | – | 1,436,442 | – | 1,436,442 | |||||||||||||||
| Shares issued on exercise of options | 824,160 | 1,427,213 | (576,909 | ) | – | 850,304 | ||||||||||||||
| Shares issued on exercise of warrants | 660,529 | 2,131,506 | – | – | 2,131,506 | |||||||||||||||
| Shares issued pursuant to prospectus offering | 29,250,000 | 44,499,915 | – | – | 44,499,915 | |||||||||||||||
| Total transactions with owners of the Company | 30,734,689 | 48,058,634 | 859,533 | – | 48,918,167 | |||||||||||||||
| Balance, March 31, 2011 | 111,094,312 | $ | 251,556,873 | $ | 15,091,886 | $ | (204,242,740 | ) | $ | 62,406,019 | ||||||||||
ym biosciences inc.
Condensed Consolidated Interim Statements of Cash Flows
(Expressed in Canadian dollars, unless otherwise noted)
(Unaudited)
| Three months ended | Nine months ended | |||||||||||||||
| March 31, | March 31, | |||||||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||||||
| Cash provided by (used in): | ||||||||||||||||
| Operating activities: | ||||||||||||||||
| Net loss for the period | $ | (6,797,158 | ) | $ | (8,344,996 | ) | $ | (14,249,626 | ) | $ | (31,968,509 | ) | ||||
| Items not involving cash: | ||||||||||||||||
| Depreciation of property and equipment | 12,521 | 20,598 | 45,655 | 59,745 | ||||||||||||
| Amortization of intangible assets | 1,127,004 | 1,127,004 | 3,381,012 | 3,381,012 | ||||||||||||
| Interest earned | (178,400 | ) | (170,437 | ) | (487,568 | ) | (308,812 | ) | ||||||||
| Unrealized (gain) loss on cash and cash equivalents | 506,775 | 505,016 | (899,883 | ) | 1,515,378 | |||||||||||
| Gain on disposal of property and equipment | – | – | – | (10,744 | ) | |||||||||||
| Share-based compensation | 373,215 | 392,244 | 1,880,899 | 1,436,442 | ||||||||||||
| Change in fair value of share purchase warrants | 417,716 | 1,137,347 | (6,846,505 | ) | 8,625,320 | |||||||||||
| Changes in non-cash working capital balances: | ||||||||||||||||
| Short-term deposits | (144,981 | ) | (156,223 | ) | (450,258 | ) | (262,590 | ) | ||||||||
| Accounts receivable | 35,697 | (91,833 | ) | (42,838 | ) | (133,812 | ) | |||||||||
| Prepaid expenses | 63,498 | 104,128 | 303,562 | (152,588 | ) | |||||||||||
| Accounts payable | (249,939 | ) | (437,564 | ) | (431,831 | ) | 275,121 | |||||||||
| Accrued liabilities | (386,440 | ) | (809,927 | ) | (868,913 | ) | 718,958 | |||||||||
| Deferred revenue | (95,318 | ) | (148,518 | ) | (392,354 | ) | (600,513 | ) | ||||||||
| Net cash used in operating activities | (5,315,810 | ) | (6,873,161 | ) | (19,058,648 | ) | (17,425,592 | ) | ||||||||
| Investing activities: | ||||||||||||||||
| Proceeds from sale of short-term deposits | 12,192,896 | 13,721,647 | 47,999,333 | 62,575,864 | ||||||||||||
| Purchase of short-term deposits | (12,000,000 | ) | (12,500,000 | ) | (46,300,000 | ) | (88,514,540 | ) | ||||||||
| Interest received | 178,400 | 170,437 | 487,568 | 308,812 | ||||||||||||
| Additions to property and equipment | (6,272 | ) | (16,267 | ) | (16,492 | ) | (68,961 | ) | ||||||||
| Net cash provided by (used in) investing activities | 365,024 | 1,375,817 | 2,170,409 | (25,698,825 | ) | |||||||||||
| Financing activities: | ||||||||||||||||
| Issuance of common shares on exercise of options | 517,836 | 596,495 | 540,286 | 850,304 | ||||||||||||
| Issue of common shares on exercise warrants | – | 135,058 | – | 985,217 | ||||||||||||
| Net proceeds from issuance of shares | 74,232,207 | 1,165,392 | 74,232,207 | 44,499,914 | ||||||||||||
| Net cash provided by financing activities | 74,750,043 | 1,896,945 | 74,772,493 | 46,335,435 | ||||||||||||
| Impact of foreign exchange rates on cash | (506,775 | ) | (505,016 | ) | 899,883 | (1,515,378 | ) | |||||||||
| Increase (decrease) in cash and cash equivalents | 69,292,482 | (4,105,415 | ) | 58,784,137 | 1,695,640 | |||||||||||
| Cash and cash equivalents, beginning of period | 21,538,285 | 25,261,196 | 32,046,630 | 19,460,141 | ||||||||||||
| Cash and cash equivalents, end of period | $ | 90,830,767 | $ | 21,155,781 | $ | 90,830,767 | $ | 21,155,781 | ||||||||