FIT Biotech Oy Company release September 14, 2016 at 11:30 am EET
This company release is a summary of FIT Biotech's Half Year Financial Report January-June 2016, which is available in full in the pdf file attached to this company release.
FIT BIOTECH OY'S HALF-YEAR FINANCIAL REPORT JANUARY 1-JUNE 30, 2016 (unaudited)
The strategic shift towards gene-based treatments continued, positive steps taken in research collaborations
Main events January-June 2016 (comparison period 1-6/2015):
- GTU® technology chosen for clinical studies to be conducted by the research consortium European HIV Vaccine Alliance (EHVA) in January
- Profit forecast for the full year 2016 lowered in March
- Collaboration initiated with Ichor Medical Systems Inc. on gene-based electroporation drug delivery technology in April
- James Kuo, MD, MBA appointed as new CEO in May
- Operational directions updated by new management and Board of Directors in May
- Safety and tolerability reported from two human clinical studies of novel DNA-based HIV vaccine in June
- After the review period FIT Biotech announced an agreement on a EUR 12,480,000 financing transaction with Bracknor Investment and an intention to agree on a EUR 500,000 financing transaction with Sitra. The financing agreement with Bracknor, which was entered into in order to ensure the continuity of FIT Biotech's business and the sufficiency of its working capital, is subject to approval at the company's Extraordinary General Meeting to be held on September 15, 2016
Key figures for January-June 2016 (comparison period 1-6/2015):
- Revenue was 10 (20) thousand euros.
- Profit for the period amounted to -1,475 (4,160) thousand euros.
- Earnings per share were -0.05 (-0.04) euros.
Guidance for 2016
Pharmaceutical product development is characterized by a long-term approach. FIT Biotech seeks to license its drug candidates to business partners who are able to undertake their further clinical development and possible future commercialization. The company's revenue model is based on signing and milestone fees of the targeted license agreements as well as on the royalties.
In March 2016, the company assessed that its operating profit for 2016 would be negative. This assessment still remains valid.
Outlook for 2016
The company continues to implement its strategy, i.e. the aim to license the patented GTU® technology to partners for medical applications. The company primarily focuses on verifying the preclinical efficacy of its drug candidates (proof-of-concept) developed on the basis of the GTU® technology.
The status of FIT Biotech's development projects at the end of the reporting period was as announced on May 20, 2016, with the exception of the grant application related to Innovative Medicines Initiative 2, which did not result in a positive decision as announced on June 10, 2016. Furthermore, the pre-clinical results concerning the suitability of the GTU® technology to gene-based treatments will be delayed and are expected in Q1/2017, as announced on September 5, 2016.
| Key financial figures | |||
| 1000 EUR | Jan 1-Jun 30, 2016 | Jan 1-Jun 30, 2015 | Jan 1-Dec 31, 2015 |
| Revenue | 10 | 20 | 20 |
| Profit / loss | -1,475 | -5,388 | -3,843 |
| Adjusted profit/loss | -1,475 | (*-1,097 | (*-2,642 |
| Profit for the period | -1,475 | 4,160 | 2,616 |
| Adjusted profit for the period | -1,475 | (**-1,084 | (**-2,629 |
| Cash flow from operations | -1,300 | -917 | -2,432 |
| Liquid assets | 521 | 3,400 | 1,845 |
| Equity | -10,750 | -7,730 | -9,275 |
| Grants | 0 | 6,539 | 6,539 |
| Balance sheet total | 1,358 | 4,611 | 2,694 |
| Return on equity (ROE), % | negat. | (***negat. | (***negat. |
| Equity ratio, % (*** | 86% | 423% | 93% |
| Return on investment (ROI), % | negat. | (***negat. | (***negat. |
(* Adjusted with the capital loan of 6,485 213 eur (** excluding the profit impact of capital loan which Tekes decided not to collect and the cost impact of financial advisors (*** financial figures are calculated by using adjusted profit / profit for the period
CEO James Kuo comments:
"We are beginning to see a paradigm shift within pharmaceutical industry from traditional biological drugs to DNA-based biological therapies. This shift, as profound as the telecommunications industry shift from copper cables to fiber optic cables, offers unprecedented advantages to patients from treating previously intractable diseases, having nearly insignificant adverse effects, and costing several orders of magnitude less than traditional biological drugs. The technology we have been developing and testing is an integral part of that transition. Our new board and management is in agreement that our corporate strategy is the right one.
I started as CEO of FIT Biotech in May 2016 at an extremely exciting time. The company's innovative GTU® vector technology for gene-based treatments is proceeding promisingly and the company's therapeutic HIV vaccine candidate was chosen for clinical studies to be conducted by a major European research consortium of recognized experts.
During this spring, we achieved positive pre-clinical results concerning the suitability of the GTU® technology to gene-based treatments, and we have continued respective extended pre-clinical studies with the goal of demonstrating its proof-of-concept, with results currently expected in the first quarter of 2017.
FIT Biotech has many ongoing research collaboration projects with several international pharmaceutical companies and research institutes investigating the suitability of our GTU® technology for various gene-based treatments. For example, in January 2016, FIT Biotech started research collaboration with European HIV Vaccine Alliance (EHVA), and in April 2016, it entered into a research collaboration agreement with US-based Ichor Medical Systems Inc.
Our aim is to verify the pre-clinical efficiency (proof-of-concept) of our drug candidates and after this to license the drug candidate to large pharmaceutical and well-established biopharmaceutical companies for further development.
As we disclosed after the review period on August 25, 2016, we entered into a major financing agreement with Bracknor Investment in order to ensure the continuity of our business and the sufficiency of the working capital.
We are extremely excited about this financing agreement with Bracknor, which will support our gene transfer vector research program and the manufacturing of investigational DNA-based medicines and vaccines for further clinical trials, and working capital needs. We look forward to utilizing the Bracknor financing to achieve our next series of drug development milestones. I am optimistic on our future outlook."
Publishing of the Financial Statements Bulletin 2016
The Financial Statements Bulletin 2016 will be published on March 10, 2017.
General statement
Some statements in this report are estimates based on the management's best knowledge at the time they were made. Therefore, they contain a certain amount of risks and uncertainty. The estimates may change in the event of significant changes in the general economic or industry conditions.
FIT BIOTECH OY
Board of Directors
More information:
Chairman of the Board Juha Vapaavuori Email: juha.vapaavuori@fitbiotech.com Tel: +358 50 372 0824
James Kuo CEO, FIT Biotech Oy Tel: +358 44 0331307, USA: +1 858 220 5703 E-mail: james.kuo@fitbiotech.com
Certified Advisor: Aalto Capital Partners Oy, telephone +358 40 5877000
FIT Biotech in brief
FIT Biotech Oy is a biotechnology company established in 1995 that develops and licenses its patented GTU® (Gene Transport Unit) vector technology for new-generation medical treatments. GTU® is a gene transport technology that meets an important medical challenge in the usability of gene therapy and DNA vaccines.
FIT Biotech applies its GTU® technology in its development projects, which at the time include gene-based treatments, genetic vaccines and research collaboration. Application areas include cancer (gene therapy) and infectious diseases such as HIV and tuberculosis, as well as animal vaccines.
FIT Biotech series K shares are listed on the First North Finland market maintained by Nasdaq Helsinki Ltd.
DISTRIBUTION:
NASDAQ OMX Helsinki Principal media www.fitbiotech.com
