KaloBios Reports First Quarter 2013 Financial Results

SOUTH SAN FRANCISCO, Calif., May 14, 2013 /PRNewswire/ -- KaloBios Pharmaceuticals, Inc. (Nasdaq: KBIO) a biopharmaceutical company with a portfolio of patient-targeted, first-in-class, antibodies to treat serious medical conditions with a primary clinical focus on respiratory diseases and cancer, announced today its financial results for the first quarter ended March 31, 2013.

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"KaloBios marked the first quarter of 2013 with an important milestone in our company's evolution: the successful completion of our initial public offering, with net proceeds to KaloBios of approximately $62 million," said David Pritchard, KaloBios President and Chief Executive Officer. "We also achieved an important clinical milestone this quarter with the start of a Phase 2 trial of KB001-A, our targeted agent against Pseudomonas aeruginosa (Pa), in patients with cystic fibrosis. We were pleased to announce shortly after the quarter's end our partner Sanofi Pasteur's receipt from the U.S. Food and Drug Administration of Fast Track Designation for KB001-A intended for protection against bacterial pneumonia caused by Pa in mechanically ventilated patients.  Finally, in April, we achieved 50% clinical enrollment for our KB003 Phase 2 asthma study putting us on track for top line results in the first quarter of 2014.

The net loss for the first quarter of 2013 was $8.6 million, or $0.55 per basic and diluted share. This compared to a net loss of $1.1 million, or $.56 per basic and diluted share, for the same period in 2012. Increased spending for our clinical trial programs and general and administrative expenses associated with being a public company resulted in the reported loss during the first quarter of 2013.  As of March 31, 2013, cash, cash equivalents and investments, excluding restricted cash, totaled $76.9 million.

Company Highlights to Date for 2013




January

Initiation of Phase 2 study with KB001-A Humaneered® antibody fragment in cystic fibrosis patients

February

Completion of initial public offering

February

Presentation of positive Phase 1/2 clinical results with anti-GM-CSF mAb KB002 in persistent asthma at American Academy of Allergy, Asthma & Immunology (AAAAI) Annual Meeting

April

Phase 2 study of KB003 in severe asthma achieved 50% enrollment

April

Sanofi awarded Fast Track Designation for KB001-A for protection against bacterial pneumonia caused by Pa in mechanically-ventilated patients

 

Anticipated Upcoming Milestones for 2013-2014



2Q 2013:

File for Orphan Drug Status in the U.S.A. and European Union for KB001-A in CF

3Q 2013:

Full recruitment of the KB003 asthma study

3Q 2013:

Initiation of the Phase 1 expansion phase of the KB004 study in AML with EphA3 diagnostic test

4Q 2013:

Full recruitment of the KB001-A CF study

1Q 2014:

Initiation of Phase 2 KB004 study in at least one new indication

1Q 2014:

Top line KB003 Phase 2 asthma study results

2Q 2014:

Top line KB001-A Phase 2 CF study results

3Q/4Q 2014:

Initiation of Sanofi Phase 2b study for prevention of ventilator-associated pneumonia (VAP)

4Q 2014:

Completion of enrollment in at least one hematologic malignancy indication in the Phase 1 expansion phase of KB004

 

About KaloBios

KaloBios Pharmaceuticals, Inc. is developing a portfolio of proprietary, patient-targeted, first-in-class monoclonal antibodies (mAbs) designed to treat serious life-threatening or debilitating disease for which there is an unmet medical need with a clinical focus on serious respiratory diseases and cancer.

Currently, KaloBios has three drug development programs:

  • KB003, an anti-GM-CSF mAb with potential to treat inflammatory diseases, is being developed for the treatment of severe asthma and is currently enrolling patients in a 150 patient Phase 2 study in the United States, Europe and Australia.
  • KB001-A, an anti-PcrV mAb fragment, is partnered exclusively with Sanofi and is being developed for the prevention and treatment of Pseudomonas aeruginosa (Pa) infection. KaloBios has retained rights for the cystic fibrosis (CF) indication and has initiated a 180 patient Phase 2 study in CF subjects with chronic Pa infection in the United States. Sanofi is pursuing a ventilator associated pneumonia prevention indication in the intensive care setting, an indication which has received U.S. FDA Fast Track Designation.
  • KB004, an anti-EphA3 mAb, has potential in treating hematologic malignancies and solid tumors. KaloBios is currently testing this drug in a Phase 1 study in subjects with hematologic malignancies.

All of the company's antibodies were generated using its proprietary Humaneered® technology, a method that converts nonhuman antibodies (typically mouse) into recombinant antibodies that have a high binding affinity to their target and are designed for chronic therapeutic use. The company believes that antibodies produced using its Humaneered® technology offer important clinical and economic advantages over antibodies generated by other methods in terms of high binding affinity, high manufacturing yields, and minimal to no immunogenicity (inappropriate immune response) upon repeat administration in humans.

For more information on KaloBios Pharmaceuticals, please visit our web site at http://www.kalobios.com.

Safe Harbor Statement

Forward Looking Statements
This release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including:  the statements under the heading "Anticipated Upcoming Milestones for 2013-2014"; and statements regarding the company's clinical development of KB001-A, KB003 and KB004.  Forward-looking statements reflect management's current knowledge, assumptions, judgment and expectations regarding future performance or events.  Although management believes that the expectations reflected in such statements are reasonable, they give no assurance that such expectations will prove to be correct and you should be aware that actual results could differ materially from those contained in the forward-looking statements.  Forward-looking statements are subject to a number of risks and uncertainties including, but not limited to, the company's limited cash reserves and its ability to obtain additional capital on acceptable terms, or at all, including the additional capital which will be necessary to complete the clinical trials that the company has initiated or plans to initiate; the company's dependence on Sanofi Pasteur for the development and commercialization of KB001-A; the company's ability to successfully complete further development of its programs; the uncertainties inherent in clinical testing; the timing, cost and uncertainty of obtaining regulatory approvals; the company's ability to protect the company's intellectual property; competition; changes in the regulatory landscape or the imposition of regulations that affect the company's products; and other factors listed under "Risk Factors" in the company's Annual Report on Form 10-K filed with the Securities and Exchange Commission on April 1, 2013 and the company's other filings with the Securities and Exchange Commission.

All forward-looking statements are expressly qualified in their entirety by this cautionary notice.  You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this release.  The company has no obligation, and expressly disclaims any obligation to update, revise or correct any of the forward-looking statements, whether as a result of new information, future events or otherwise.

Contact:

Jeffrey H. Cooper
Chief Financial Officer
KaloBios Pharmaceuticals, Inc.
(650) 243-3146
ir@kalobios.com

Media Contact:

Joan E. Kureczka
Kureczka/Martin Associates
Tel:  (415) 821-2413
Mobile: (415) 690-0210
Joan@Kureczka-Martin.com

---- Tables to Follow --

 

Consolidated Balance Sheets

March 31, 2013 and December 31, 2012

(in thousands, except share and per share information)



March 31,


December 31,


2013


2012


 (unaudited)



  Assets




  Current assets:




Cash and cash equivalents 

$    69,949


$      10,947

Marketable securities 

6,901


9,351

Contract receivables 

34


87

Prepaid expenses and other current assets 

1,896


871

  Total current assets 

78,780


21,256





  Restricted cash 

205


205

  Property and equipment, net 

193


230

  Deferred offering costs

-


2,803

  Intangible and other assets 

41


45

  Total assets 

$    79,219


$      24,539





  Liabilities, convertible preferred stock and stockholders' equity (deficit)




  Current liabilities:




Accounts payable 

$      6,199


$        2,448

Accrued compensation 

828


628

Deferred rent, short-term 

113


101

Accrued research and clinical liabilities 

1,384


3,538

Notes Payable

811


-

Other accrued liabilities 

275


502

  Total current liabilities 

9,610


7,217





  Deferred rent, long-term 

31


62

  Notes payable, less current portion

9,050


9,826

  Other liabilities, long-term 

198


355

  Total liabilities 

18,889


17,460









Convertible preferred stock, $0.001 par value: no shares and 60,152,555 shares authorized at March 31, 2013, and  December 31, 2012, respectively;  no shares and  12,329,330 shares issued and outstanding at March 31, 2013, and December 31, 2012, respectively; aggregate liquidation preference of $105,512 at December 31, 2012

-


102,023





  Stockholders' equity (deficit): 




Common stock, $0.001 par value: 80,000,000 shares authorized at March 31, 2013, and December 31, 2012, respectively; 24,147,815 and 2,186,695 shares issued and outstanding at March 31, 2013, and December 31, 2012, respectively

24


2

Additional paid-in capital 

167,143


3,317

Accumulated other comprehensive income

4


4

Accumulated deficit 

(106,841)


(98,267)

  Total stockholders' equity (deficit)

60,330


(94,944)

  Total liabilities and stockholders' equity (deficit)

$    79,219


$      24,539





 

Consolidated Statements of Operations

Three Months Ended March 31, 2013 and 2012

(in thousands, except share and per share information)

(Unaudited)










Three Months Ended March 31,




2013


2012








Contract revenue


$ 16


$ 3,018








Operating expenses:






Research and development


6,320


3,220


General and administrative


2,019


945


Total operating expenses


8,339


4,165








Loss from operations


(8,323)


(1,147)








Other income (expense):






Interest income (expense), net


(252)


6


Other income (expense), net


1


10


Net loss


$ (8,574)


$ (1,131)








Basic and diluted net loss per common share


$ (0.55)


$ (0.56)








Weighted average common shares outstanding used to calculate basic and diluted net loss per common share


15,607,379


2,023,285


 

Stock based Compensation Expense

Three Months Ended March 31, 2013 and 2012

(in thousands)

(Unaudited)








Total stock-based compensation expense included in the consolidated statements of operations is as follows:










Three Months Ended March 31,





2013


2012










Research and development


$ 96


$ 12



General and administrative


85


9



Total stock-based compensation expense


$ 181


$ 21



 

SOURCE KaloBios Pharmaceuticals, Inc.



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