MediciNova Reports Third Quarter 2013 Results

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| Source: MediciNova, Inc.

SAN DIEGO, Nov. 7, 2013 (GLOBE NEWSWIRE) -- MediciNova, Inc., a biopharmaceutical company traded on the NASDAQ Global Market (Nasdaq:MNOV) and the Jasdaq Market of the Tokyo Stock Exchange (Code Number:4875), today announced financial results for the third quarter ended September 30, 2013.

A detailed discussion of financial results and product development programs can be found in MediciNova's Quarterly Report on Form 10-Q for the quarter ended September 30, 2013, which was filed with the Securities and Exchange Commission on November 7, 2013 and is available through investors.medicinova.com/sec.cfm.

Financial Results

For the quarter ended September 30, 2013, MediciNova reported a net loss of $2.2 million, or $0.10 per share compared to a net loss of $2.4 million, or $0.14 per share for the same period last year. The Company reported no service revenue for the quarter ended September 30, 2013, whereas the Company recorded revenue relating to services performed under an agreement with Kissei Pharmaceutical Co., Ltd. of $0.1 million for the quarter ended September 30, 2012. Research and development expenses were $0.8 million for the quarter ended September 30, 2013, as compared to $0.9 million for the quarter ended September 30, 2012. General and administrative expenses were $1.5 million for the quarter ended September 30, 2013, as compared to $1.6 million for the quarter ended September 30, 2012. The decreases in research and development and general and administrative expenses were due primarily to reductions in employee-related expenses.

At September 30, 2013, MediciNova had available cash and cash equivalents of $10.7 million and working capital of $9.9 million. Between August 21, 2012, the date of the Common Stock Purchase Agreement with Aspire Capital Fund, LLC, or Aspire, and September 30, 2013, the Company generated net proceeds of $5.4 million under the Aspire agreement.  Between April 17, 2013, the date of the at-the-market Equity Distribution Agreement with Macquarie Capital (USA) Inc., or MCUSA, and September 30, 2013, the Company generated net proceeds of $5.6 million under the MCUSA agreement. In May, the Company generated net proceeds of $3.7 million under a Securities Purchase Agreement with certain accredited investors. The Company has not generated additional proceeds under the above agreements subsequent to September 30, 2013 through today's date. On October 16, 2103 the Company entered into a new Equity Distribution Agreement with MCUSA and the Company has not generated material proceeds under the new MCUSA agreement between that date and November 5, 2013.

Recent Highlights

  • On October 16, 2013, MediciNova announced the appointment of Geoffrey O'Brien, J.D./M.B.A. as Vice President. Mr. O'Brien served as Senior Director, Business Development and Strategic Planning for MediciNova since 2012 and was Director, Business Development from 2009-2012. Prior to joining MediciNova, Mr. O'Brien was an equity research analyst covering pharmaceutical and biotechnology companies at UBS Securities, Nomura Securities, and Punk, Ziegel, and was a Vice President from 2004-2008.
  • On October 16, 2013, MediciNova announced the election of Mr. Yutaka Kobayashi to its Board of Directors. Mr. Kobayashi complements the MediciNova Board with more than 20 years of experience in business.
  • On October 16, 2013, MediciNova entered into an at-the-market Equity Distribution Agreement with MCUSA pursuant to which the Company may from time to time sell through MCUSA shares of our common stock up to an aggregate offering price of $10 million.
  • On October 6, 2013, MediciNova announced that it has received a Notice of Allowance from the U.S. Patent and Trademark Office for a pending patent application which covers MN-029 (denibulin) di-hydrochloride. Once issued, the patent maturing from this allowed patent application is expected to expire no earlier than July 2032. 
  • On August 25, 2013, MediciNova announced that the National Institute on Alcohol Abuse and Alcoholism (NIAAA), part of the National Institutes of Health (NIH), will fund a clinical trial of MN-166 (ibudilast) for alcohol dependence. This Phase 2a trial will be conducted at UCLA and will be led by Lara Ray, Ph.D., Associate Professor, Department of Psychology, Department of Psychiatry and Biobehavioral Sciences, and the UCLA Brain Research Institute.
  • On July 18, 2013, MediciNova announced the initiation of a cooperative Phase 2b trial with MN-166 (ibudilast) in progressive multiple sclerosis (MS). The study is a unique collaboration of medical centers, the National Multiple Sclerosis Society and MediciNova, with primary funding provided by an $11.3 million grant from the NIH. The principal investigator will be Robert Fox, M.D., M.S., FAAN, Staff Neurologist at the Mellen Center for Multiple Sclerosis at the Cleveland Clinic.

"We are very excited about the achievement of several major milestones this quarter, including the NIH NeuroNEXT grant award for a Phase 2b trial of MN-166 in progressive MS as well as the NIAAA grant award for a Phase 2a trial of MN-166 in alcohol dependence," said Yuichi Iwaki, M.D., Ph.D., President and Chief Executive Officer of MediciNova. "We believe we are well positioned to continue to advance our development pipeline and look forward to completion of our goals."

About MediciNova

MediciNova, Inc. is a publicly-traded biopharmaceutical company founded upon acquiring and developing novel, small-molecule therapeutics for the treatment of diseases with unmet medical needs with a commercial focus on the U.S. market. MediciNova's current strategy is to focus on its two prioritized product candidates, MN-166 (ibudilast) for neurological disorders, and MN-221 for the treatment of acute exacerbations of asthma. MN-166 is being developed in multiple indications, largely through investigator-sponsored trials and outside funding. MediciNova is engaged in strategic partnering and consortium funding discussions to support further development of both the MN-221 and MN-166 programs. For more information on MediciNova, Inc., please visit www.medicinova.com.

Statements in this press release that are not historical in nature constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements regarding our clinical development strategies and goals, including future development, statements regarding the progress of clinical trials, statements regarding expectations for the ibudilast/MN-166 program, including development of ibudilast/MN-166 for certain indications and expectations on future progress in the development of our drug candidates, expected timing of clinical trial results and any implication as to the results of our development, partnering and funding efforts, the implication of patent terms and potential product exclusivity, the implication that the company will have the ability to execute on its priorities and plans to raise additional capital. These forward-looking statements may be preceded by, followed by or otherwise include the words "believes," "expects," "anticipates," "intends," "estimates," "projects," "can," "could," "may," "will," "would," or similar expressions. These forward-looking statements involve a number of risks and uncertainties that may cause actual results or events to differ materially from those expressed or implied by such forward-looking statements. Factors that may cause actual results or events to differ materially from those expressed or implied by these forward-looking statements include, but are not limited to, risks of obtaining future partner or grant funding for development of MN-166, MN-221 and other product candidates and risks of raising sufficient capital when needed to fund MediciNova's operations and contribution to clinical development, risks and uncertainties inherent in clinical trials designed to meet FDA guidance and the viability of further development considering these factors, including the potential cost, expected timing and risks associated with clinical trials, product development and commercialization risks, the uncertainty of whether the results of clinical trials will be predictive of results in later stages of product development, the risk of delays or failure to obtain or maintain regulatory approval, risks associated with the reliance on third parties to sponsor and fund clinical trials, risks regarding intellectual property rights in product candidates and the ability to defend and enforce such intellectual property rights, the risk of failure of the third parties upon whom MediciNova relies to conduct its clinical trials and manufacture its product candidates to perform as expected, the risk of increased cost and delays due to delays in the commencement, enrollment, completion or analysis of clinical trials or significant issues regarding the adequacy of clinical trial designs or the execution of clinical trials, and the timing of expected filings with the regulatory authorities, MediciNova's collaborations with third parties, the availability of funds to complete product development plans and MediciNova's ability to obtain third party funding for programs and raise sufficient capital when needed, and the other risks and uncertainties described in MediciNova's filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2012 and its subsequent periodic reports on Forms 10-Q and 8-K. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date hereof. MediciNova disclaims any intent or obligation to revise or update these forward-looking statements.

MEDICINOVA, INC.
CONSOLIDATED BALANCE SHEETS
 
  September 30,
2013
December 31,
2012
  (Unaudited)  
Assets    
Current assets:    
Cash and cash equivalents $ 10,660,849 $ 4,010,530
Prepaid expenses and other current assets  378,248  411,592
Total current assets  11,039,097  4,422,122
Goodwill  9,600,241  9,600,241
In-process research and development  4,800,000  4,800,000
Investment in joint venture  676,481  667,204
Property and equipment, net  80,801  78,474
Total assets $ 26,196,620 $ 19,568,041
     
Liabilities and Stockholders' Equity    
Current liabilities:    
Accounts payable $ 186,892 $ 491,853
Accrued expenses  472,426  314,652
Accrued compensation and related expenses  440,086  228,124
Current deferred revenue  —   3,163
Total current liabilities  1,099,404  1,037,792
Deferred tax liability  1,956,000  1,956,000
Long-term deferred revenue  1,694,163  1,694,257
Total liabilities  4,749,567  4,688,049
     
Stockholders' equity:    
Preferred stock, $0.01 par value; 3,000,000 shares authorized at September 30, 2013 and December 31, 2012; 220,000 shares issued and outstanding at September 30, 2013 and December 31, 2012  2,200  2,200
Common stock, $0.001 par value; 100,000,000 shares authorized at September 30, 2013 and December 31, 2012; 22,377,943 and 17,407,311 shares issued at September 30, 2013 and December 31, 2012, respectively, and 22,377,943 and 17,403,125 shares outstanding at September 30, 2013 and December 31, 2012, respectively  22,378  17,407
Additional paid-in capital  326,300,292  312,293,225
Accumulated other comprehensive loss  (77,838)  (67,957)
Treasury stock, at cost; 0 shares at September 30, 2013 and 4,186 shares at December 31, 2012  (1,124,389)  (1,131,086)
Deficit accumulated during the development stage  (303,675,590)  (296,233,797)
Total stockholders' equity  21,447,053  14,879,992
Total liabilities and stockholders' equity $ 26,196,620 $ 19,568,041
     
MEDICINOVA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 
  Three months ended
September 30,
Nine months ended
September 30,
Period from
September 26,
2000
          (inception) to
          September 30,
  2013 2012 2013 2012 2013
Revenues $ — $ 83,787 $ 3,257 $ 768,584 $ 2,364,064
Operating expenses:          
Cost of revenues  —  —  —  —  1,258,421
Research and development  785,573  872,555  2,427,650  4,234,956  169,482,305
General and administrative  1,456,774  1,573,943  5,023,445  5,057,802  117,280,813
Total operating expenses  2,242,347  2,446,498  7,451,095  9,292,758  288,021,539
Operating loss  (2,242,347)  (2,362,711)  (7,447,838)  (8,524,174)  (285,657,475)
Impairment charge on investment securities  —  —  —  —  (1,735,212)
Other expense  (395)  (14,329)  (5,920)  (19,376)  (395,150)
Interest expense  —  —  —  —  (3,605,818)
Other income  7,798  4,090  14,315  22,027  19,159,498
Loss before income taxes  (2,234,944)  (2,372,950)  (7,439,443)  (8,521,523)  (272,234,157)
Income taxes  (1,806)  (5,818)  (2,350)  (5,818)  (78,311)
Net loss  (2,236,750)  (2,378,768)  (7,441,793)  (8527,341)  (272,312,468)
Accretion to redemption value of redeemable convertible preferred stock  —  —  —  —  (98,445)
Deemed dividend resulting from beneficial conversion feature on Series C redeemable convertible preferred stock  —  —  —  —  (31,264,677)
Net loss applicable to common stockholders $ (2,236,750) $ (2,378,768) $ (7,441,793) $ (8,527,341) $ (303,675,590)
Basic and diluted net loss per common share $ (0.10) $ (0.14) $ (0.37) $ (0.52)  
Shares used to compute basic and diluted net loss per common share  22,301,773  16,585,172  20,114,289  16,273,247  
Net loss applicable to common stockholders $ (2,236,750) $ (2,378,768) $ (7,441,793) $ (8,527,341) $ (303,675,590)
           
Other comprehensive loss, net of tax:          
Foreign currency translation adjustments  756  2,864  (9,881)  (2,019)  (77,838)
Comprehensive loss $ (2,235,994) $ (2,375,904) $ (7,451,674) $ (8,529,360) $ (303,753,428)
INVESTOR CONTACT:
Geoff O'Brien
Vice President
MediciNova, Inc.