CEL-SCI Corporation (NYSE MKT: CVM) reported financial results
today for the fiscal year ended September 30, 2014. The Company also
reported key clinical and corporate developments achieved during, and
subsequent to, fiscal 2014.
Corporate Developments Included:
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CEL-SCI raised gross proceeds of $34.1 million during fiscal 2014 and
an additional $7.0 million subsequent to the end of the fiscal year,
to finance its expanding Phase III trial in the treatment of head and
neck cancer.
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During fiscal 2014, CEL-SCI signed a Cooperative Research and
Development Agreement (CRADA) with the U.S. Navy under which the Navy
is conducting a clinical investigation of Multikine in HIV/HPV
co-infected men and women with anal warts. The Phase I trial started
enrolling patients in September 2014 at San Diego Naval Medical
Center. We expect the study to be complete in the second half of 2015.
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In July 2014, CEL-SCI received a Phase I Small Business Innovation
Research (SBIR) grant in the amount of $225,000 from the National
Institute of Arthritis Musculoskeletal and Skin Diseases (NIAMS),
which is part of the National Institutes of Health (NIH). The grant is
funding the further development of CEL-SCI’s LEAPS technology as a
potential treatment for rheumatoid arthritis. The work is being
conducted at Rush University Medical Center in Chicago, Illinois.
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CEL-SCI signed two co-development and profit sharing agreements worth
$6.0 million with Ergomed, one of its two new clinical research
organizations (CROs). Ergomed will assume up to $3.0 million in
clinical and regulatory costs for two different Multikine indications,
cervical dysplasia in HIV/HPV co-infected women and peri-anal warts in
HIV/HPV co-infected men and women. Ergomed will receive its return on
investment based on an agreed single digit percentage of net income
received by CEL-SCI for Multikine from product sales and/or certain
partner milestone payments. These two co-development agreements build
upon CEL-SCI’s $10.0 million co-development agreement with Ergomed for
Multikine in the treatment of head and neck cancer.
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On October 31, 2013, CEL-SCI filed an arbitration claim against
inVentiv, the CRO that used to run CEL-SCI’s Phase III trial with
Multikine, under the Commercial Rules of the American Arbitration
Association alleging (i) breach of contract, (ii) fraud in the
inducement, and (iii) common law fraud, and seeks at least $50 million
in damages.
Clinical Developments Included:
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In fiscal year 2014, CEL-SCI expanded the reach of its Multikine Phase
III trial for the treatment of head and neck cancer. CEL-SCI received
clearance from 7 new countries for the Phase III trial, added
approximately 30 sites and set multiple record breaking months for
enrolling patients. As of November 30, 2014, about 310 patients have
been enrolled in the study.
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CEL-SCI presented data at the 12th Vaccines Research & Development:
All Things Considered Conference in Boston, Massachusetts in July
2014. The presentation centered on the theory that using LEAPS
vaccines to treat a complex disease like Rheumatoid Arthritis can be
beneficial because CEL-SCI’s vaccine can be synthesized to stimulate
the appropriate immune response to treat the disease based on its
immunodominant cytokine phenotype, which can be predetermined before
treatment. The data presented included results from studies conducted
at Rush University Medical Center.
CEL-SCI reported an operating loss of ($27.57) million in fiscal year
2014 versus an operating loss of ($19.87) million in fiscal year 2013.
The rise in operating loss was attributable to an increase in research
and development expenses to $17.0 million in fiscal year 2014 compared
to $12.68 million in fiscal year 2013. This expense increased based on
the additional activity level of the Phase III clinical trial. It was
also attributable to an increase in general and administrative expenses
to $10.6 million in fiscal year 2014 compared to $6.98 million in fiscal
year 2013. This increase is primarily due to equity based compensation
costs of approximately $1.48 million for restricted stock issued,
increased public relations cost of $440,000 and legal fees of $1.67
million. Public relations costs increased to support the progression of
the products through clinical trials. Legal fees increased primarily as
a result of arbitration with the Company’s former CRO.
CEL-SCI’s net loss available to common shareholders for the fiscal year
2014 was ($28.48) million, or ($0.48) per share, versus a loss of
($9.23) million, or ($0.30) per share for the fiscal year 2013. The
change in net loss available to common shareholders in fiscal year 2014
was primarily due to the gain on derivative instruments of $0.25 million
for fiscal year 2014 versus a gain on derivative instruments of $10.75
million for fiscal year 2013 and an increase in total operating expenses
of $27.84 million for fiscal year 2014 versus $20.03 million for fiscal
year 2013.
Geert Kersten, CEL-SCI’s Chief Executive Officer said, “Fiscal 2014 was
a pivotal year for us. The accelerated pace of our Phase III trial with
our two new CROs affirms the strength of our study and the potential of
Multikine. We also made advancements in two new indications for
Multikine in HIV/HPV co-infected patients with cervical dysplasia and
anal-warts. These two indications have the potential for Multikine to
produce data and move towards marketing approvals at a faster pace than
our large Phase III trial.”
“We believe fiscal 2015 is a year in which we will achieve and report
several significant milestones,” Kersten concluded.
About Multikine
Multikine (Leukocyte Interleukin, Injection) is an investigational
immunotherapeutic agent that is being tested in an open-label,
randomized, controlled, global pivotal Phase III clinical trial as a
potential first-line treatment for advanced primary head and neck
cancer. If approved for use following completion of CEL-SCI's clinical
development program for head and neck cancer, Multikine would be a
different type of therapy in the fight against cancer; one that appears
to have the potential to work with the body's natural immune system in
the fight against tumors. CEL-SCI is aiming to complete enrollment of
subjects to the Phase III head and neck cancer study by the end of 2015.
The trial is expected to expand into a total of approximately 100
clinical centers in over 20 countries.
About CEL-SCI Corporation
CEL-SCI’s work is focused on finding the best way to activate the immune
system to fight cancer and infectious diseases. Its lead investigational
therapy Multikine (Leukocyte Interleukin, Injection) is currently being
studied in a pivotal Phase III clinical trial against head and neck
cancer. If the study endpoint, which is a 10% improvement in overall
survival of the subjects treated with Multikine treatment regimen as
compared to subjects treated with current standard of care only is
satisfied, the study results will be used to support applications which
will be submitted to regulatory agencies in order to receive from these
agencies commercial marketing approvals for Multikine in major markets
around the world. Additional clinical indications for Multikine which
are being investigated include cervical dysplasia in HIV/HPV co-infected
women, and the treatment of peri-anal warts in HIV/HPV co-infected men
and women. A Phase I trial of the former indication has been completed
at the University of Maryland. The latter indication is now in a Phase I
trial in conjunction with the U.S. Navy under a CRADA.
CEL-SCI is also developing its LEAPS technology for the treatment of
pandemic influenza and as a potential therapeutic vaccine against
rheumatoid arthritis. The Company has recently received a Phase I SBIR
Grant from the National Institutes of Health to develop LEAPS as a
potential treatment for RA with researchers from Rush University Medical
Center in Chicago, Illinois. The Company has operations in Vienna,
Virginia, and in/near Baltimore, Maryland.
For more information, please visit www.cel-sci.com.
* Multikine is the trademark that CEL-SCI has registered for this
investigational therapy, and this proprietary name is subject to FDA
review in connection with its future anticipated regulatory submission
for approval. Multikine has not been licensed or approved for sale,
barter or exchange by the FDA or any other regulatory agency. Similarly,
its safety or efficacy has not been established for any use. Moreover,
no definitive conclusions can be drawn from the early-phase,
clinical-trials data involving the investigational therapy Multikine
(Leukocyte Interleukin, Injection). Further research is required, and
early-phase clinical trial results must be confirmed in the
well-controlled, Phase III clinical trial of this investigational
therapy that is currently in progress.
When used in this release, the words "intends," "believes,"
"anticipated" and "expects" and similar expressions are intended to
identify forward-looking statements. Such statements are subject to
risks and uncertainties which could cause actual results to differ
materially from those projected. Factors that could cause or contribute
to such differences include, an inability to duplicate the clinical
results demonstrated in clinical studies, timely development of any
potential products that can be shown to be safe and effective, receiving
necessary regulatory approvals, difficulties in manufacturing any of the
Company's potential products, inability to raise the necessary capital
and the risk factors set forth from time to time in CEL-SCI
Corporation's SEC filings, including but not limited to its report on
Form 10-K for the year ended September 30, 2014. The Company undertakes
no obligation to publicly release the result of any revision to these
forward-looking statements which may be made to reflect the events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
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CEL-SCI CORPORATION
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CONSOLIDATED STATEMENTS OF OPERATIONS
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YEARS ENDED SEPTEMBER 30, 2014 and 2013
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2014
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2013
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GRANT INCOME AND OTHER
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$
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264,033
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$
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159,583
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OPERATING EXPENSES:
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Research and development (excluding R&D depreciation of $172,442,
$253,072 and $445,710 respectively, included below)
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17,000,145
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12,681,049
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Depreciation and amortization
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231,752
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364,124
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General & administrative
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10,606,248
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6,982,686
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Total operating expenses
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27,838,145
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20,027,859
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OPERATING LOSS
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(27,574,112
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)
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(19,868,276
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)
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GAIN ON DERIVATIVE INSTRUMENTS
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248,767
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10,750,666
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INTEREST INCOME
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122,854
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117,086
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INTEREST EXPENSE
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(163,774
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)
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(170,423
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)
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NET LOSS
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(27,366,265
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)
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(9,170,947
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)
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ISSUANCE OF ADDITIONAL SHARES DUE TO RESET PROVISIONS
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(1,117,447
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)
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-
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MODIFICATIONS OF WARRANTS
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-
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(59,531
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)
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INDUCEMENT WARRANTS
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-
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-
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NET LOSS AVAILABLE TO COMMON SHAREHOLDERS
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$
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(28,483,712
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)
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$
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(9,230,478
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)
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NET LOSS PER COMMON SHARE
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BASIC
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$
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(0.48
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)
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$
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(0.30
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)
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DILUTED
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$
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(0.49
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)
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$
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(0.66
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)
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WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
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BASIC and DILUTED
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58,804,622
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30,279,442
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Copyright Business Wire 2014