4SC AG publishes financial results for the first quarter2009
Highlights of the first quarter 2009:
- Begin of clinical phase II for lead compound 4SC-101 for a second indication (Crohn's disease)
- Preparations underway for second phase II trials of 4SC-101 for rheumatoid arthritis
- Successful completion of clinical phase I for cancer drug 4SC-201
- Liver carcinoma (HCC) selected as first indication for phase II study of 4SC-201 beginning shortly
For the first quarter of 2009, 4SC AG posted sales of 0.5 million EUR from research collaborations, down 21% from 0.6 million EUR for the same period in the prior year. The significantly increased number of own pipeline projects was accompanied by raising direct costs for development as well as an expansion of personnel resources in the development department. Consequently, research and development costs rose correspondingly by over 70% to 3.4 million EUR (first quarter 2008: 2.0 million EUR).
As anticipated, the operating loss rose from 2.3 million EUR in Q1 2008 to 3.9 million EUR. The net loss for the quarter after taxes increased from 2.2 million EUR to 3.7 million EUR. As the number of shares outstanding increased significantly from averaged 19.0 to 28.5 million as a result of last year's capital increase, diluted and undiluted earnings per share were nearly unchanged at -0.13 EUR versus -0.12 EUR year-on-year. At the end of the quarter funds totalled 17.4 million EUR (31 December 2008: 21.8 million EUR). The equity ratio increased from 90.4% at 31 December 2008 to 92.1% at the end of the reporting period.
Dr Ulrich Dauer, CEO of 4SC AG, commented: 'We made further clinical progress last quarter thanks in part to our solid cash position. The advances made attest to the value of the drug candidates acquired last year. At the same time, we implemented further value-enhancing measures in our development pipeline. Patient recruiting has begun for the phase IIa study of 4SC-101 for a second indication, chronic inflammatory bowel disorders. We are working intensively to ready the oncology project 4SC-201 for the start of the proof-of-concept studies on two types of cancer this year. While the number of research projects has risen, our expenditures will be focused exclusively on value-driving research and development so as to ensure utilising our cash reserves as efficiently as possible.'
Efficacy studies for clinical candidates 4SC-101 and 4SC-201
During the period under review the clinical phase IIa proof-of-concept study of 4SC-101 was initiated for chronic inflammatory bowel disease (Crohn's disease). In this multicentric, single-arm, exploratory open-label study, the candidate will be administered in pill form to 24 patients over a 12-week period in a 35 mg dose. To date, available treatment options for Crohn's disease have been inadequate. Thus the commercial potential of 4SC-101 will be considerable in the event of clinical success.
Simultaneously, the company made progress in preparations for a second phase II study for rheumatoid arthritis (RA). The objective of this randomised, placebo-controlled and blind study is to provide proof-of-concept for the use of 4SC-101 in combination with the standard medication Methotrexat (MTX) by RA patients as opposed to using MTX as a monotherapy. In the first quarter of 2009, the necessary toxicological studies of 4SC-101 in combination with MTX were concluded, meaning the new set of trials can be filed for within the next few months.
Preparations are likewise underway for the start of the first phase II study of 4SC-201, one substance of the Nycomed oncology pipeline acquired in July 2008. These included the evaluation of data in the first quarter 2009 from the successfully completed phase I study. The results indicated a stabilising of the progression of the disease with several patients with different types of tumours. Based on these findings, 4SC AG selected hepatocellular carcinoma (HCC) as the first indication for clinical phase II trials. This type of liver cancer is world's third most frequent cause of cancer mortality. With the drug Nexavar being the only approved medication for the systemic treatment of advanced liver carcinoma at this time, there is a tremendous need for new treatment options.
4SC AG also achieved improvements in the quarter facilitating the advancement of clinical pipeline projects on a broad front. Four preclinical development projects are in advanced preliminary phases for submission of a clinical study plan. Preparations are furthermore underway for the clinical start of 4SC-203 for acute myeloid leukaemia (AML), a particularly aggressive form of blood cancer.
The 4SC AG business strategy is designed specifically around developing proprietary projects up to proof of clinical efficacy, at which point we license them to partners in the pharmaceutical industry on attractive financial terms. In view of the current situation on the financial markets, the company will be even more diligent in the selective deployment of financial resources for concrete value-enhancing measures in ongoing as well as new clinical programmes. The company continues to enjoy the active support and professional expertise of our largest shareholder Santo Holding in communicating the sustainability of our business model to international investors.
In the weeks ahead we look forward to the start of clinical phase II studies for 4SC-201 for liver carcinoma. In the second quarter all regulatory requirements for 4SC-101 should be met for the initiation of a second phase II study for rheumatoid arthritis. This development program is designed to demonstrate potentially enhanced efficacy of 4SC-101 in combination with Methotrexat, with good tolerability, versus monotherapy with Methotrexat. Also this year the company intends to enter clinical phase I for either one ortwo other substances.
The full interim report was posted today on our website, www.4sc.com.
Teleconference and webcast
Today at 11 AM local time (10 AM GMT), 4SC AG will be holding a public teleconference in English. Company management will be discussing the financial results posted and significant developments in the first quarter of 2009.
To participate in the teleconference, in Europe dial +49 (0)89 2030 3245 or +44 (0)20 7138 0838; from the US dial +1 718 354 1362 (from other countries just dial one of the D/UK/US numbers). The required access code is 2414416.
We recommend dialling in 10 minutes prior to the start time.
An accompanying presentation is accessible on the internet at http://www.euvisioncast.com (Meeting ID: 2414416; Meeting Password: pw1830).
After the live presentation, an audio replay of the teleconference will be made posted on our website www.4sc.de under the heading 'Investors'.
This document may contain projections or estimates relating to plans and objectives relating to our future operations, products, or services; future financial results; or assumptions underlying or relating to any such statements; each of which constitutes a forward-looking statement subject to risks and uncertainties, many of which are beyond our control. Actual results could differ materially, depending on a number of factors.
4SC AG (ISIN DE0005753818) has been listed in the Prime Standard of Frankfurt Stock Exchange since 15 December 2005. Founded in 1997 and now with a staff of 90 employees, the company develops novel drug candidates against inflammatory diseases and cancer. 4SC AG utilises its patent protected platform, to create a sustainable project pipeline of drug candidates, which are to be developed up to clinical efficacy in early clinical phases ('proof of concept') and subsequently partnered with the pharmaceutical industry in return for advance and milestone payments as well as royalties. There are currently eight projects in the development pipeline and a rich pool of further discovery projects. Clinical phase IIa for the first project for the treatment of rheumatoid arthritis has already successfully been completed and a clinical phase II trial in IBD (Crohn's disease) has recently been started. An additional project for the treatment of various cancers has successfully completed a clinical phase I trial and will commence clinical phase II testing shortly. Further projects are in advanced pre-clinical stages.
Further information is to be found at www.4sc.com.