SLOUGH, U.K., May 23, 2005 (PRIMEZONE) -- Xenova Group plc (Nasdaq:XNVA) (LSE:XEN) today announced its results for the quarter ended 31 March 2005.
Year to Date Highlights
-- TransMID(TM): obtains orphan drug designation in Japan
-- TransMID(TM): licensed to PharmaEngine Inc for distribution, marketing and sales in the People's Republic of China and the Republic of South Korea
-- DISC-HSV Vector and DISC-GM-CSF: licensed to Oxxon Therapeutics Ltd for up to 44m Pounds ($83m)
-- TA-CIN: licensed to Cancer Research Technology
-- TA-NIC: further promising findings from second clinical study
-- XR303: Ph I/II pancreatic study to enroll additional patients
-- Revenue recognised for the first quarter of 1.1m Pounds($2.0m) (Q1 2004: 0.9m Pounds ($1.6m) )
-- Cash, short term deposits and investments at 31 March 2005 of 9.4m Pounds ($17.6m) (Q1 2004: 22.0m Pounds ($41.3m))
David Oxlade, Chief Executive Officer of Xenova said: "We continue to demonstrate value within our pipeline, as evidenced by the three license deals announced so far this year. With the global rights to our addiction vaccines and the North American rights to TransMID(TM) as yet unpartnered, Xenova retains considerable value in its pipeline."
Below is a summary of the current status of our programmes:
TransMID(TM) - Phase III TransMID(TM) is the most advanced product candidate in Xenova's pipeline, currently in Phase III clinical trials. TransMID(TM) is a potential treatment for glioblastoma multiforme (GBM), the most common form of high grade glioma (brain cancer).
A Phase III clinical programme in patients with non-resectable, progressive and/or recurrent GBM is underway. Up to 323 patients are being enrolled in the first randomised, open-label, multi-centre trial. Patients will be randomised in a 2:1 ratio of TransMID(TM) to best standard of care across approximately 65 centres in the EU, Israel and North America. The primary end point is overall survival time with a planned interim analysis to be conducted after 50% of required events have been observed. This interim analysis is expected in 2006. Patient dosing began in July 2004 and recruitment is ongoing.
In February 2005, Sosei Co Ltd (Sosei), Xenova's licensee for the Japanese market, was granted orphan drug status for the use of TransMID(TM) in the treatment of GBM by the Ministry of Health, Labour and Welfare (MHLW) in Japan. The achievement of this designation triggered a milestone payment from Sosei to Xenova. Orphan drug designation will facilitate the initiation of clinical trials by Sosei and provide a fast track approval process by the MHLW, once trials have been completed and a dossier seeking marketing approval has been filed. TransMID(TM) already has orphan drug designation in the US and Europe as well as fast track status in the US.
In April, Xenova entered into a licensing agreement with PharmaEngine Inc (PharmaEngine) of Taiwan for the exclusive rights to develop, market and sell TransMID(TM) in both the People's Republic of China and the Republic of South Korea. PharmaEngine will also be undertaking self-funded registration trials in these territories. Xenova received an up-front payment and will receive milestone payments as well as significant royalties on potential future sales.
TransMID(TM) is licensed to Sosei in Japan, Nycomed in Europe, Medison in Israel, Ranbaxy in India and PharmaEngine in China and South Korea. The rights to TransMID(TM) in North America have been retained.
TA-CD -- Phase II TA-CD, Xenova's therapeutic vaccine for the treatment of cocaine addiction, is undergoing two separate Phase II clinical trials. The first, a 10 patient open labelled Phase IIa cocaine administration trial, is designed to evaluate the effect of TA-CD on behavioural changes associated with cocaine administration. This trial is expected to report in 2005.
The second is a randomised, placebo controlled Phase IIb trial. The primary objective of this study is to determine the efficacy of TA-CD in addicts seeking treatment for cocaine abuse, and to determine appropriate end-points for a Phase III study. Up to 132 subjects, all of whom are methadone-dependent cocaine addicts being treated for drug dependency, are being recruited into this clinical study. Half the subjects will be treated with active TA-CD and half will be given a placebo. Subjects will be monitored three times a week to assess cocaine usage, including testing for cocaine metabolites in urine, for a period of 20 weeks. Patients will also undergo medical examinations and blood tests for anti-cocaine antibodies to assess the immunogenicity of the dosing schedule. The trial is expected to report in 2006 and will allow an objective assessment of the efficacy of the TA-CD vaccine against placebo.
The TA-CD investigations are being funded in part by the National Institute on Drug Abuse (NIDA) which recognises cocaine abuse to be a major problem in the US. NIDA has also supported earlier clinical work as part of this programme. Xenova retains the global rights to the vaccine.
Tariquidar -- Phase II Discovered by Xenova, tariquidar is a potent small-molecule inhibitor of the P-glycoprotein pump, which is being developed for the treatment of multi-drug resistance (MDR) in cancer.
The National Cancer Institute in the U.S. (NCI) commenced exploratory Phase I/II and Phase II studies with tariquidar in combination with various cytotoxic drugs in 2003. The studies include one in adrenocortical cancer, one in lung, ovarian or cervical cancer and a paediatric study in solid tumours. These studies are currently on-going and further information can be accessed through the NCI website at www.nci.nih.gov.
Xenova is in discussions with QLT regarding the return of their rights, arising from the license agreement entered into between QLT and Xenova in August 2001.
TA-NIC -- Phase I A second Phase I study, building upon the findings of the first Phase I trial, recruited 60 smokers, divided into three cohorts of 20 subjects (16 receiving the active TA-NIC, 4 receiving the placebo). The objectives of this double-blind, randomized, placebo controlled Phase I clinical study were to explore the safety, tolerability and level of anti-nicotine antibody response to increasing doses of the vaccine (50 mg, 250 mg, 1000 mg), and to select a dose for Phase II and Phase III evaluation. Interim data were announced in July 2004 and preliminary final data were announced in March 2005.
These findings showed that the 12 month self-reported quit rates were substantially greater among those receiving TA-NIC than those receiving placebo. Only one out of 12 participants (8%) in the placebo group reported being abstinent at their last visit or at 12 months, compared to 3 out of 16 (19%) and 6 out of 16 (38%) in the groups receiving the 250 mg and 1000 mg doses of TA-NIC respectively.
Immunogenicity data after 12 months follow-up and the safety and tolerability profile support the 20-week findings and confirm the selection of the 250 mg dose for use in the Phase II and Phase III clinical trials. The Phase II trial is expected to commence during 2005 and interim results are expected in 2006.
Xenova retains global rights to the TA-NIC vaccine.
XR303 -- Phase I/II XR303 (131I-labelled anti-CEA monoclonal antibody) is currently in a Phase I/II trial in patients with unresectable pancreatic cancer. This is a dose escalation trial comparing the intravenous and intra-arterial routes of administration. Preliminary experience suggests that tumour targeting is improved via the intra-arterial route of administration. It has been decided to enrol a further 6 patients, with recruitment expected to be complete by July 2005.
The product comprises a super high affinity antibody, labelled with a radionuclide, 131Iodine. The antibody binds to carcino-embryonic antigen (CEA), a marker which is widely expressed on solid tumours. The antibody can thus deliver a dose of radiation to the tumour that is sufficient to kill tumour cells whilst limiting damage to normal tissues.
In May 2003 both the European Commission and FDA granted orphan drug designation to XR303 for pancreatic cancer. Xenova retains all rights to XR303.
Novel DNA Targeting Agents -- XR11576/XR5944/XR11612 -- Phase I This programme is being developed for the treatment of solid tumours. Results of the Phase I trial for XR11576 and preliminary results of the Phase I trial for XR5944 were announced in March 2005.
The Phase I clinical trial of XR11576 in solid tumours has been completed with the recruitment of 38 patients divided between two oral dosing schedules. No objective responses (complete responses or partial responses) were reported, however, stable disease was reported in nine out of the 38 patients. No Phase II dose has been established.
The Phase I trial of XR5944 from 27 patients with solid tumours using a single intravenous dosing schedule of a 30 minute infusion once every three weeks is currently being finalised. No objective responses (complete responses or partials responses) were reported, however four out of the 27 patients had stable disease.
Xenova and Millennium are in discussions regarding the return of the North America rights arising from the license agreement entered into between Millennium and Xenova in December 2001.
OX40 -- Pre-clinical OX40/OX40L is a platform for the creation of multiple product candidates targeting cancer inflammatory and autoimmune disease. Xenova has produced by recombinant DNA technology a modified form of the OX40 molecule which can be used to block the interaction between the OX40 receptor and its ligand (OX40L) and hence inhibit T-cell activation. This product candidate has been shown to be effective in pre-clinical models of inflammatory and autoimmune disease. Other molecules have been produced from this platform that augment T cell activation and have proven effective at protecting against tumour growth and infectious disease in pre-clinical models.
Xenova retains all rights for the use of OX40 in the up-regulation of the immune system, whilst Genentech and UCB (previously Celltech) have the rights for the down-regulation of the immune system.
Collaborations relating to De-Prioritised Programmes In January 2005 Xenova announced a licensing agreement with Cancer Research Technology Limited (CRT) in respect of the Company's intellectual property relating to TA-CIN. TA-CIN is a vaccine developed by Xenova as a treatment for women with cervical dysplasia, and has proved safe and immunogenic in Phase I and Phase II clinical trials.
CRT has licensed TA-CIN patents, know-how and materials from Xenova and will undertake marketing of TA-CIN to potential commercial partners with a view to sub-licensing the development and commercialisation of the product. Net receipts from the sub-licensing of TA-CIN will be shared between Xenova and CRT after certain direct costs have been recouped. In addition, CRT will facilitate a further Phase II clinical trial to be undertaken at St Mary's Hospital in Manchester.
In January 2005 Xenova also announced the signing of an exclusive licensing agreement with Oxxon Therapeutics Ltd (Oxxon) potentially worth up to 44 million Pounds ($83 million) in up-front and milestone payments, in the event four products complete commercialisation. Royalties will be paid on future sales of any products which might be derived from the DISC-HSV Vector platform.
The agreement provides Oxxon with the right to use the DISC-HSV Vector in a number of specified indications in the areas of oncology and infectious diseases. Oxxon also has the option to further, as yet unspecified, indications subject to payment of additional fees. The agreement includes global development, manufacturing and marketing rights to DISC-GM-CSF, an oncology product developed using the DISC-HSV Vector platform, which has successfully completed a Phase I dose escalating safety study.
Clinical Trials Manufacturing Facility In line with our continuing strategy of generating revenues through the utilization of excess capacity at our clinical trials manufacturing facility, we entered into a manufacturing contract with a Danish biotechnology company in early 2005.
Financial Summary The financial results for the quarter represent Xenova's first financial statements presented following the adoption of IFRS on 1 January 2005. Comparatives for the prior year have also been restated using IFRS and a reconciliation of the adjustments is included in the notes. All numbers are unaudited.
Operating Performance In the three months to 31 March 2005, revenues from licensing agreements, strategic partnerships and manufacturing outsourcing were 1.1m Pounds ($2.0m ), (2004: 0.9m Pounds ($1.6m)). Revenue included license fees and milestones of 0.7m Pounds ($1.2m) and manufacturing revenue of 0.4m Pounds ($0.8m).
Cost of sales fell to 0.4m Pounds ($0.8m) from 0.8m Pounds ($1.5m) in 2004 as manufacturing activities focused more on internal projects in the quarter, compared to the same period last year.
Research and development expenditure of 3.2m Pounds ($5.9m) (2004: 3.2m Pounds ($6.1m) ) was in line with the prior year. Costs were mainly incurred in respect of the TransMID(TM) Phase III trial as well as the TA-NIC Phase I trial.
Administrative expenses of 1.5m Pounds ($2.9m) (2004: 1.0m Pounds ($1.9m)) increased by 0.5m Pounds from 2004 as a result of increased professional fees incurred in corporate activities.
Other income generated from sub-letting space in Cambridge and Slough increased to 0.2m Pounds ($0.5m) in 2005 from 0.1m Pounds ($0.2m) last year reflecting the impact of the Genzyme lease at Cambridge which commenced in Q2 2004.
The net loss per share in Q1 was 0.8p (1.5c) (2004: 0.9p (1.7c)).
Cash, short-term deposits and investments Cash, short-term deposits and investments at 31 March 2005 totalled 9.4m Pounds ($17.6m) (2004: 22.0m Pounds ($41.3m)). The Group held cash of 0.5m Pounds ($0.9m and short-term deposits and investments of 8.9m Pounds ($16.7m) at 31 March 2005 (2004: cash 1.1m Pounds ($2.1m) , short-term deposits and investments 20.9m Pounds ($39.3m)).
Share capital The number of shares in issue stood at 431.5 million as at 31 March 2005.
Xenova Group plc is a UK-based biopharmaceutical company focused on the development of novel drugs to treat cancer and addiction with a secondary focus in immunotherapy. The Company has a broad pipeline of product candidates in clinical development, including three cancer programmes: its lead product candidate TransMID(TM), for the treatment of high-grade glioma, is in Phase III trials, and its novel DNA targeting agents and XR303 are both in Phase I for cancer indications. Xenova is also developing two therapeutic vaccines for cocaine and nicotine addiction, which are in Phase II and Phase I trials respectively. Quoted on the London Stock Exchange (XEN) and on NASDAQ (XNVA), Xenova has approximately 75 full time employees in the UK and North America. (Reuters XEN.L; Bloomberg XEN LN).
For further information about Xenova and its products please visit the Xenova website at www.xenova.com and www.gbmtrial.com
This press release contains "forward-looking statements," including statements about the revenues which we could earn from milestone payments for product candidates under development and the discovery, development and commercialization of products. Various risks may cause Xenova's actual results to differ materially from those expressed or implied by the forward looking statements, including: adverse results and delays in our drug discovery and clinical development programs; failure to achieve product development or commercialization milestones on a timely basis or at all; failure to obtain effective patent protection for our discoveries; commercial limitations imposed by patents owned or controlled by third parties; our dependence upon strategic alliance partners to develop and commercialize products and services; difficulties or delays in obtaining regulatory approvals to market products and services resulting from our development efforts; the requirement for substantial on-going funding to conduct research and development and to expand commercialization activities; and product initiatives by competitors. For a further list and description of the risks and uncertainties we face, see our reports on file with the Securities and Exchange Commission. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
US dollar amounts provided in the text have been translated at the closing rate on 31 March 2004 (1.00:$1.88 Pounds) solely for information.
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