Talon Therapeutics, Inc. Reports First Quarter 2013 Financial Results

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| Source: Talon Therapeutics, Inc.

SOUTH SAN FRANCISCO, Calif., May 15, 2013 (GLOBE NEWSWIRE) -- Talon Therapeutics, Inc., (OTCQB:TLON), today reported financial results for the three months ended March 31, 2013.

Corporate Highlights:

  • Manufactured and packaged commercial lots of Marqibo® for the treatment of Philadelphia chromosome negative adult acute lymphoblastic leukemia (ALL) patients in second or greater relapse or whose disease has progressed following two or more prior lines of anti-leukemia therapy.
  • Increased number of clinical sites to 88 with enrollment reaching 164 patients in the Phase 3 Marqibo® trial, named OPTIMAL>60, for elderly patients with newly diagnosed non-Hodgkin's lymphoma (NHL). Initiation of the additional sites in 2013 is expected to accelerate patient accrual.  
  • Completion of enrollment in the Phase 2 trial of Menadione Topical Lotion (MTL) sponsored and conducted by the Mayo Clinic. The study assessed the effectiveness of MTL in preventing skin toxicities for patients taking biologic and small molecule EGFR inhibitors for anti-cancer therapy. The Mayo Clinic will perform analysis from data collected on the subjects.
  • Publication of the Marqibo® relapsed and refractory adult ALL trial results in the Journal of Clinical Oncology in February 2013. In March 2013, the Cancer Chemotherapy and Pharmacology Journal published our paper titled, "Marqibo® improves the pharmacokinetics and pharmacodynamics of vincristine." Additional papers have been submitted to various journals and are awaiting journal acceptance.       

Three Months Ended March 31, 2013 Unaudited Financial Results

For the three months ended March 31, 2013, Talon reported a net loss of $17.5 million and deemed dividends attributable to preferred stock of $5.1 million, which when combined, resulted in a net loss applicable to common stockholders of $22.6 million, or $1.03 per share. This compares to a net loss of $30.5 million and deemed dividends of $5.6 million, which when combined, resulted in a net loss applicable to common stockholders of $36.1 million, or $1.66 per share, for the three months ended March 31, 2012. The change in fair value of Talon's preferred stockholders' rights to purchase additional shares of preferred stock contributed to $11.6 million, or $0.53 per share, of the total net loss applicable to common stockholders for the three months ended March 31, 2013. The change in fair value of Talon's preferred stockholders' right to purchase additional shares of preferred stock is primarily driven by fluctuations in price of Talon's common stock. The deemed dividends attributable to preferred stock contributed to $0.23 per share of the total net loss applicable to common stockholders for the three months ended March 31, 2013.

Total operating expenses for the three months ended March 31, 2013 were $4.7 million, compared with $4.4 million for the three months ended March 31, 2012. Research and development expenses were $2.8 million for the three months ended March 31, 2013, compared with $2.7 million for the corresponding period in the preceding year. General and administrative expenses were $1.9 million for the three months ended March 31, 2013, compared with $1.7 million for the corresponding period in the preceding year.

As of March 31, 2013, the Company had cash and cash equivalents of $4.1 million. Cash used in operations was $4.8 million for the three months ended March 31, 2013.

About Marqibo® (vincristine sulfate liposome injection)

Marqibo is a novel, targeted Optisome™ encapsulated formulation product candidate of the FDA-approved anticancer drug vincristine. Talon is primarily developing Marqibo for the treatment of Ph- adult ALL. Vincristine, a microtubule inhibitor, is FDA-approved for ALL and is widely used as a single agent and in combination regimens for treatment for hematologic malignancies such as lymphomas and leukemias. Talon's encapsulation formulation is designed to provide prolonged circulation of the drug in the blood and accumulation at the tumor site. These characteristics are intended to increase the dose of vincristine delivered in a safe and effective manner. 

Talon has received orphan drug and fast track designations for Marqibo for the treatment of adult ALL from the U.S. Food and Drug Administration. Marqibo has also received orphan drug designation in adult ALL from the European Medicines Evaluation Agency.

Please see important safety information below and the full prescribing information for Marqibo at www.marqibo.com.

Indication and usage

Marqibo is a liposomal vinca alkaloid indicated for the treatment of adult patients with Philadelphia chromosome-negative (Ph-) acute lymphoblastic leukemia (ALL) in second or greater relapse or whose disease has progresses following two or more anti-leukemia therapies. This indication is based on overall response rate. Clinical benefit such as improvement in overall survival has not been verified.

Important safety information

CONTRAINDICATIONS

  • Marqibo is contraindicated in patients with demyelinating conditions including Charcot-Marie-Tooth syndrome
  • Marqibo is contraindicated in patients with hypersensitivity to vincristine sulfate or any of the other components of Marqibo (vinCRIStine sulfate LIPOSOME injection
  • Marqibo is contraindicated for intrathecal administration

WARNING

See full prescribing information for complete boxed warning.

  • For Intravenous Use Only -- Fatal if Given by Other Routes
  • Death has occurred with intrathecal use
  • Marqibo (vinCRIStine sulfate LIPOSOME injection) has different dosage recommendations than vinCRIStine sulfate injection. Verify drug name and dose prior to preparation and administration to avoid overdosage.

Warnings and Precautions

For Intravenous Use Only

For Intravenous use only. Fatal if given by other routes.

Extravasation Tissue Injury

Only administer through a secure and free-flowing venous access line. If extravasation is suspected, discontinue infusion immediately and consider local treatment measures.

Neurologic Toxicity

Sensory and motor neuropathies are common and are cumulative. Monitor patients for symptoms of neuropathy, such as hypoesthesia, hyperesthesia, paresthesia, hyporeflexia, areflexia, neuralgia, jaw pain, decreased vibratory sense, cranial neuropathy, ileus, burning sensation, arthralgia, myalgia, muscle spasm, or weakness, both before and during treatment. Orthostatic hypotension may occur. The risk of neurologic toxicity is greater if Marqibo is administered to patients with preexisting neuromuscular disorders or when other drugs with risk of neurologic toxicity are being given. In the studies of relapsed and/or refractory adult ALL patients, Grade >= 3 neuropathy events occurred in 32.5% of patients. Worsening neuropathy requires dose delay, reduction, or discontinuation of Marqibo.

Myelosuppression

Monitor complete blood counts prior to each dose of Marqibo. If Grade 3 or 4 neutropenia, thrombocytopenia, or anemia develops, consider Marqibo dose modification or reduction as well as supportive care measures.

Tumor Lysis Syndrome

Tumor lysis syndrome (TLS) may occur in patients with ALL receiving Marqibo. Anticipate, monitor for, and manage.

Constipation and Bowel Obstruction

Ileus, bowel obstruction, and colonic pseudo-obstruction have occurred. Marqibo can cause constipation. Institute a prophylactic bowel regimen to mitigate potential constipation, bowel obstruction, and/or paralytic ileus, considering adequate dietary fiber intake, hydration, and routine use of stool softeners, such as docusate. Additional treatments, such as senna, bisacodyl, milk of magnesia, magnesium citrate, and lactulose may be considered.

Fatigue

Marqibo can cause severe fatigue. Marqibo dose delay, reduction, or discontinuation may be necessary.

Hepatic Toxicity

Fatal liver toxicity and elevated levels of aspartate aminotransferase have occurred. Elevated levels of aspartate aminotransferase of Grade >=3 occurred in 6-11% of patients in clinical trials. Monitor hepatic function tests. Reduce or interrupt Marqibo for hepatic toxicity.

Embryofetal Toxicity

Marqibo can cause fetal harm when administered to a pregnant woman. Vincristine sulfate liposome injection was teratogenic or caused embryo-fetal death in animals. Women of childbearing potential should avoid becoming pregnant while being treated with Marqibo. There are no adequate and well-controlled studies of Marqibo in pregnant women and there were no reports of pregnancy in any of the clinical studies in the Marqibo clinical development program. If this drug is used during pregnancy, or if the patient becomes pregnant while taking this drug, the patient should be apprised of the potential hazard to a fetus [see Use in Specific Populations].

Adverse Reactions

The most common adverse reactions (>30%) were constipation (57%), nausea (52%), pyrexia (43%), fatigue (41%), peripheral neuropathy (39%), febrile neutropenia (38%), diarrhea (37%), anemia (34%), decreased appetite (33%), and insomnia (32%).

The most commonly reported SAEs included febrile neutropenia (20.5%), pyrexia (13.3%), hypotension (7.2%), respiratory distress (6.0%), and cardiac arrest (6.0%).

Twenty-eight percent of patients experienced adverse reactions leading to treatment discontinuation. The most common adverse reactions that caused treatment discontinuation were peripheral neuropathy (10%), leukemia-related (7%), and tumor lysis syndrome (2%).

Deaths occurred in 23% of patients in study 1. The non-leukemia related causes of deaths were brain infarct (1), intracerebral hemorrhage (2), liver failure (1), multi-system organ failure (2), pneumonia and septic shock (3), respiratory failure (4), pulmonary hemorrhage (1), and sudden cardiac death (1).

Drug Interactions

No formal drug interaction studies have been conducted with Marqibo. Marqibo is expected to interact with drugs known to interact with non-liposomal vincristine sulfate.

Simultaneous oral or intravenous administration of phenytoin and antineoplastic chemotherapy combinations that included non-liposomal vincristine sulfate has been reported to reduce blood levels of phenytoin and to increase seizure activity.

CYP3A Interactions

Vincristine sulfate, the active agent in Marqibo, is a substrate for cytochrome P450 3A isozymes (CYP3A); therefore, the concomitant use of strong CYP3A inhibitors should be avoided (e.g., ketoconazole, itraconazole, voriconazole, posaconazole, clarithromycin, atazanavir, indinavir, nefazodone, nelfinavir, ritonavir, saquinavir, telithromycin). Similarly, the concomitant use of strong CYP3A inducers should be avoided (e.g., dexamethasone, phenytoin, carbamazepine, rifampin, rifabutin, rifapentine, phenobarbital, St. John's Wort).

P-glycoprotein Interactions

Vincristine sulfate, the active agent in Marqibo, is also a substrate for P-glycoprotein (P-gp). The effect of concomitant use of potent P-gp inhibitors or inducers has not been investigated; it is likely that these agents will alter the pharmacokinetics or pharmacodynamics of Marqibo. Therefore the concomitant use of potent P-gp inhibitors or inducers should be avoided.

Use in Specific Populations

Pregnancy

Pregnancy Category D [see Warnings and Precautions]

Based on its mechanism of action and findings from animal studies, Marqibo can cause fetal harm when administered to pregnant women.

If this drug is used during pregnancy, or if the patient becomes pregnant while taking this drug, the patient should be apprised of the potential hazard to a fetus. In an embryofetal developmental study, pregnant rats were administered vincristine sulfate liposome injection intravenously during the period of organogenesis at vincristine sulfate doses of 0.022 to 0.09 mg/kg/day. Drug-related adverse effects included fetal malformations (skeletal and visceral), decreases in fetal weights, increased numbers of early resorptions and post-implantation losses, and decreased maternal body weights Malformations were observed at doses >= 0.044 mg/kg/day in animals at systemic exposures approximately 20-40% of those reported in patients at the recommended dose.

Nursing Mothers

It is not known whether this drug is excreted in human milk. Because many drugs are excreted in human milk and because of the potential for serious adverse reactions in nursing infants, a decision should be made whether to discontinue nursing or discontinue the drug taking into account the importance of the drug to the mother.

Pediatric Use

The safety and effectiveness of Marqibo in pediatric patients have not been established.

Geriatric Use

Safety and effectiveness in elderly individuals have not been established. In general, dose selection for an elderly patient should be cautious, reflecting the greater frequency of decreased hepatic, renal, or cardiac function, and of concomitant disease or other drug therapy.

Renal Impairment

The influence of renal impairment on the safety, efficacy, and pharmacokinetics of Marqibo has not been evaluated.

Hepatic Impairment

Non-liposomal vincristine sulfate is excreted primarily by the liver. The influence of severe hepatic impairment on the safety and efficacy of Marqibo has not been evaluated. The pharmacokinetics of Marqibo was evaluated in patients with moderate hepatic dysfunction (Child-Pugh B) secondary to melanoma liver metastases. The dose-adjusted maximum plasma concentration (Cmax) and area under the concentration-time curve (AUC) of Marqibo in patients with moderate hepatic impairment was comparable to the Cmax and AUC of patients with ALL who had otherwise normal hepatic function.

About Talon Therapeutics

Talon Therapeutics, Inc. is a biopharmaceutical company dedicated to seizing upon medical opportunities, efficiently and expertly leading product candidates through clinical development, and transferring value to patients, patient care providers, shareholders, corporate partners, and employees.

In addition to Marqibo® (vincCRIStine sulfate LIPOSOME injection) which received accelerated approval from the US FDA in August 2012, Talon has additional pipeline opportunities some of which like Marqibo, have the potential to improve delivery and enhance the therapeutic benefits of well characterized, proven chemotherapies and enable high potency dosing without increased toxicity.

Additional information on Talon Therapeutics can be found at www.talontx.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are often, but not always, made through the use of words or phrases such as "anticipates," "expects," "plans," "believes," "intends," and similar words or phrases. Such statements involve risks and uncertainties that could cause Talon's actual results to differ materially from the anticipated results and expectations expressed in these forward-looking statements. These statements are based on current expectations, forecasts and assumptions that are subject to risks and uncertainties, which could cause actual outcomes and results to differ materially from these statements. Such risks and uncertainties include: Talon's ability to commercialize Marqibo alone or with a strategic partner; the likelihood of completing a strategic transaction; Talon's lack of experience commercializing pharmaceutical products; that Talon will be able to secure the additional capital necessary to fund operational activities for Marqibo, including its ongoing research and development programs to completion; Talon's reliance on third-party clinical research organizations to develop its product candidates, and its lack of experience in developing pharmaceutical products. Additional risks are described in the company's Annual Report on Form 10-K for the year ended December 31, 2012 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2013. Talon assumes no obligation to update these statements, except as required by law.

TALON THERAPEUTICS, INC.
     
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
     
  March 31, December 31,
  2013 2012
     
ASSETS    
Current assets:    
Cash and cash equivalents  $ 4,114  $ 2,973
Inventory 383 283
Prepaid expenses and other current assets 249 238
Total current assets 4,746 3,494
     
Property and equipment, net 37 43
Restricted cash 34 34
Debt issuance costs, net 471 518
Total assets  $ 5,288  $ 4,089
     
LIABILITIES AND STOCKHOLDERS' DEFICIT    
Current liabilities:    
Accounts payable and accrued liabilities  $ 3,845  $ 3,549
Investors' rights to purchase shares of Series A-3 Preferred Stock 21,775 14,276
Other short term liabilities 2 3
     
Total current liabilities 25,622 17,828
Notes payable, net of discount 25,063 24,833
Warrant liabilities, non-current 705 563
Total long term liabilities 25,768 25,396
Total liabilities 51,390 43,224
Redeemable convertible preferred stock; $0.001 par value:    
10 million shares authorized, 0.73 million and 0.67 million shares issued and outstanding at March 31, 2013 and December 31, 2012, respectively; aggregate liquidation value of $85.8 million and $77.9 million at March 31, 2013 and December 31, 2012, respectively 53,896 47,914
     
Stockholders' deficit:    
Common stock; $0.001 par value:    
600 million shares authorized, 22.0 million shares issued and outstanding at March 31, 2013 and December 31, 2012, respectively 22 22
Additional paid-in capital 141,090 136,563
Accumulated deficit (241,110) (223,634)
Total stockholders' deficit (99,998) (87,049)
Total liabilities, redeemable convertible preferred stock and stockholders' deficit  $ 5,288  $ 4,089
 
TALON THERAPEUTICS, INC.
     
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except per share data)
(Unaudited)
     
  Three Months Ended
  March 31,
  2013 2012
Operating expenses:    
General and administrative  $ 1,945  $ 1,685
Research and development 2,809 2,742
Total operating expenses 4,754 4,427
     
Loss from operations (4,754) (4,427)
     
Other expense:    
Interest expense, net (944) (938)
Change in fair value of warrant liabilities  (142) (455)
Change in fair value of investors' right to purchase future shares of Series A-1 and A-2 preferred stock  (1,007)
Change in fair value of investors' right to purchase future shares of Series A-3 preferred stock  (11,636) (23,664)
Total other expense (12,722) (26,064)
     
Net loss  $ (17,476)  $ (30,491)
Deemed dividends attributable to preferred stock in connection with accretion  (1,847) (1,262)
Deemed dividends attributable to preferred stock in connection with embedded conversion features  (3,263) (4,352)
     
Net loss applicable to common stock (22,586) (36,105)
     
Net loss per share applicable to common stock, basic and diluted  $ (1.03)  $ (1.66)
     
Weighted average shares used in computing net loss per share, basic and diluted 22,011 21,788
     
Comprehensive loss  $ (17,476)  $ (30,491)
Talon Therapeutics, Inc.
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