BioLineRx Reports Second Quarter 2014 Financial Results

BioLineRx has reported its financial results for the second quarter ended June 30, 2014.

Kinneret Savitsky, Ph.D., CEO of BioLineRx, remarked, “In the second quarter of 2014 we continued to make headway in our clinical and pre-clinical programs, focusing primarily on our lead products in oncology and immunology - BL-8040 for the treatment of acute myeloid leukemia (AML), stem cell mobilization and other hematological indications, and BL-7010 for the treatment of celiac disease.

“BL-8040 is currently in the midst of the dose-escalation part of a Phase 2 trial for the treatment of AML, which is being conducted at several world-leading cancer research centers in the U.S. and Israel. The study is progressing nicely and we continue to expect final Phase 2 data in early 2015. Additionally, after receiving approval from the Israeli Ministry of Health, we expect to commence a Phase 1 trial for BL-8040 as a novel stem cell mobilization agent during the next 4-6 weeks, with results expected in late 2014 or early 2015. We also anticipate an investigator-initiated Phase 1/2 trial for BL-8040 as a treatment for chronic myeloid leukemia (CML) to commence by the end of the year, to be performed by Prof. Arnon Nagler at Sheba Medical Center in Israel. We look forward to providing updates on these important clinical milestones over the next several months, as well as reporting the final results from both the AML and stem cell mobilization trials within the next six to nine months.

“We also announced unblinded results of our Phase 1/2 safety study for BL-7010, our novel, non-absorbable, orally available, co-polymer intended for the treatment of celiac disease. BL-7010 showed no serious or dose-limiting adverse events after the 14-day repeated administration stage of the study, and pharmacokinetic analyses confirmed that there was no systemic exposure to BL-7010. This is significant, as the lack of systemic absorption may allow BL-7010 to be regulated as a medical device in Europe, accelerating its pathway to commercialization. Based on the anticipated therapeutic window for BL-7010, we are currently investigating lower repeated doses of BL-7010 as a continuation of this study, in order to potentially mitigate the minor gastrointestinal events observed at higher doses, as well in the placebo group, and to select the optimal dose to carry forward into the upcoming efficacy study, which we expect to commence in early 2015.

“As for BL-1040, our novel resorbable polymer solution for the prevention of ventricular remodeling following an acute myocardial infarction (AMI), PRESERVATION I, the ongoing CE Mark registration trial, continues to advance towards completion in the hands of our out-licensing partner, Bellerophon. Over 200 patients have been enrolled in the study, which is designed to enroll a total of approximately 300 patients. We continue to expect Bellerophon to complete enrollment by the end of the year, with study completion anticipated around mid-2015.

“Finally, as part of our ongoing efforts to investigate novel pipeline assets, we announced the in-licensing of BL-1110 for the treatment of neuropathic pain. While we remain focused primarily on the clinical development of our lead oncology and immunology programs, BioLineRx will continue to look at earlier-stage opportunities, based on our proven ability to identify such compounds, in order to enhance and maintain our development pipeline.”

Financial Results for Quarter and Six Months Ended June 30, 2014

Research and development expenses for the three months ended June 30, 2014 were NIS 9.7 million ($2.8 million), a decrease of NIS 2.4 million ($0.7 million), or 20%, compared to NIS 12.1 million ($3.5 million) for the three months ended June 30, 2013. The decrease resulted primarily from certain one-time costs associated with several clinical-stage projects in 2013, partially offset by increased spending on BL-7010 in the 2014 period. Research and development expenses for the six months ended June 30, 2014 were NIS 19.2 million ($5.6 million), a decrease of NIS 18.3 million ($5.3 million), or 49%, compared to NIS 37.5 million ($10.9 million) for the six months ended June 30, 2013, after taking into account the NIS 6.0 million ($1.7 million) one-time reversal of a liability to the OCS in respect of BL-1020. The decrease resulted primarily from termination of the BL-1020 CLARITY clinical trial in March 2013 and certain one-time costs associated with several clinical-stage projects in 2013, partially offset by increased spending on BL-7010 in the 2014 period as mentioned above.

Sales and marketing expenses for the three months ended June 30, 2014 were NIS 1.0 million ($0.3 million), substantially similar to the comparable period in 2013. Sales and marketing expenses for the six months ended June 30, 2014 were NIS 2.3 million ($0.7 million), an increase of NIS 0.5 million ($0.2 million), or 24%, compared to NIS 1.8 million ($0.5 million) for the six months ended June 30, 2013. The increase resulted primarily from professional fees related to increased business development activities.

General and administrative expenses for the three months ended June 30, 2014 were NIS 2.9 million ($0.8 million), a decrease of NIS 0.7 million ($0.2 million), or 20%, compared to NIS 3.6 million ($1.0 million) for the three months ended June 30, 2013. The decrease resulted primarily from a one-time expense for professional services incurred in the 2013 period. General and administrative expenses for the six months ended June 30, 2014 were NIS 6.3 million ($1.9 million), a decrease of NIS 0.8 million ($0.2 million), or 11%, compared to NIS 7.1 million ($2.1 million) for the six months ended June 30, 2013. The reason for the decrease is similar to the one discussed above in the three-month comparison.

The Company’s operating loss for the three months ended June 30, 2014 amounted to NIS 13.6 million ($3.9 million), compared with an operating loss of NIS 16.8 million ($4.9 million) for the comparable period in 2013. The Company’s operating loss for the six months ended June 30, 2014 amounted to NIS 27.8 million ($8.1 million), compared with an operating loss of NIS 40.5 million ($11.8 million) for the comparable period in 2013.

The Company’s net non-operating income amounted to NIS 1.0 million ($0.3 million) for the three months ended June 30, 2014, a decrease of NIS 0.6 million ($0.2 million), compared to net non-operating income of NIS 1.6 million ($0.5 million) for the three months ended June 30, 2013. Non-operating income for both periods primarily relates to fair-value adjustments of liabilities on account of the warrants issued in the private and direct placements conducted in February 2012 and 2013. The Company’s net non-operating income amounted to NIS 6.8 million ($2.0 million) for the six months ended June 30, 2014, a decrease of NIS 7.0 million ($2.0 million), compared to net non-operating income of NIS 13.8 million ($4.0 million) for the comparable 2013 period. The reason for the decrease is similar to the one discussed above in the three-month comparison.

The Company’s net financial expense amounted to NIS 1.5 million ($0.4 million) for the three months ended June 30, 2014, compared to net financial expense of NIS 0.4 million ($0.1 million) for the three months ended June 30, 2013. Net financial income and expense result primarily from changes in the average exchange rate of the dollar in relation to the NIS during the respective periods, which have a direct effect on the Company’s net assets denominated in dollars. The Company’s net financial expense amounted to NIS 0.6 million ($0.2 million) for the six months ended June 30, 2014, compared to net financial expense of NIS 1.8 million ($0.5 million) for the comparable 2013 period. The reason for the decrease is similar to the one discussed above in the three-month comparison.

The Company’s net loss for the three months ended June 30, 2014 amounted to NIS 14.1 million ($4.1 million), compared with a net loss of NIS 15.6 million ($4.5 million) for the comparable period in 2013. The Company’s net loss for the six months ended June 30, 2014 amounted to NIS 21.5 million ($6.3 million), compared with a net loss of NIS 28.4 million ($8.3 million) for the comparable period in 2013.

The Company held NIS 114.0 million ($33.1 million) in cash, cash equivalents and short-term bank deposits as of June 30, 2014.

Net cash used in operating activities was NIS 26.9 million ($7.8 million) for the six months ended June 30, 2014, compared with net cash used in operating activities of NIS 41.5 million ($12.1 million) for the six months ended June 30, 2013. The NIS 14.6 million ($4.3 million) decrease in net cash used in operating activities during the six-month period in 2014, compared to the six-month period in 2013, was primarily the result of decreased research and development spending.

Net cash used in investing activities for the six months ended June 30, 2014 was NIS 53.8 million ($15.6 million), compared to net cash used in investing activities of NIS 21.4 million ($6.2 million) for the six months ended June 30, 2013. The changes in cash flows from investing activities relate primarily to investments in, and maturities of, short-term bank deposits and other investments during the respective periods.

Net cash provided by financing activities for the six months ended June 30, 2014 was NIS 78.6 million ($22.9 million), compared to net cash provided by financing activities of NIS 46.0 million ($13.4 million) for the six months ended June 30, 2013. The cash flows from financing activities in 2014 primarily reflect the Company’s underwritten public offering of ADSs in March 2014. The cash flows from financing activities in 2013 primarily reflect the Company’s direct placement to OrbiMed completed in February 2013, as well as funding under the share purchase agreement with Lincoln Park Capital.