BioLineRx Ltd. has reported its financial results for the year ended December 31, 2014.
Kinneret Savitsky, Ph.D., CEO of BioLineRx, remarked, “2014 marks a year of significant progress for BioLineRx on multiple fronts, both from a product development perspective, as well as from a business perspective. We have continued our focus on the therapeutic areas of oncology and immunology, while increasing the emphasis on our clinical-stage programs.”
“During the past year, we significantly enhanced and expanded the development strategy for our unique BL-8040 cancer therapy platform across a variety of hematological indications. Results to date from our ongoing Phase 2a clinical study of BL-8040 in relapsed and refractory AML patients continue to show substantial mobilization of leukemic cells from the bone marrow and robust induction of cancer cell apoptosis, as well as excellent safety and tolerability. Top-line results from this study are expected in the second half of 2015. BL-8040 is also in the midst of a Phase 1 safety and efficacy study in stem cell mobilization, with top-line results expected by the end of this month. We eagerly await the data from both of these important studies. In addition, we recently expanded our clinical strategy for BL-8040 to include new clinical trials in three additional hematological indications, all of which are expected to commence by the end of the second quarter of this year. We look forward to executing our comprehensive development plan for this promising treatment platform and to reaching several meaningful value inflection points during 2015.”
“With regard to BL-7010, our product for the treatment of celiac disease, we are very pleased with the positive results we reported for the Phase 1/2 safety study completed in the fourth quarter of 2014, including the determination of the optimal safe dose for continued development. We are also very encouraged that the results further support previous preclinical data showing that BL-7010 is not absorbed systemically, which will likely support a medical-device classification and an expedited development pathway for the product in Europe. We are now conducting additional non-clinical studies and formulation development for BL-7010 in preparation for the upcoming efficacy study, which we plan to initiate in the second half of this year.”
“In December 2014, our partner Bellerophon reached a significant milestone in the development of BL-1040 for the prevention of ventricular remodeling following AMI - the completion of enrollment in the large CE Mark registration trial that has been ongoing for the past three years. We look forward to the top-line results from this trial, expected in mid-2015.”
“During the fourth quarter of 2014, we announced two significant business development achievements. First and foremost, we entered into a multi-year strategic collaboration with Novartis for the screening and co-development of therapeutic candidates through clinical proof-of-concept. As part of the collaboration, Novartis made an equity investment in BioLineRx of $10 million. We are very excited about the future potential of this collaboration, and view it as a strong validation of our core competencies by a world leader in our industry. In addition, we also announced the out-licensing to Omega Pharma of BL-5010, our skin lesion product, which we hope will begin to provide a royalty stream to us beginning in 2016.”
“Following the successful completion of our $29 million follow-on public offering earlier this month, we have a strong balance sheet, with enough cash to carry out our operating plan for at least the next three years. We expect to reach multiple significant catalysts during this period of time, both in the short term during 2015, as well as in 2016 and 2017.”
Financial Results for Year Ended December 31, 2014
Research and development expenses for the year ended December 31, 2014 were NIS 42.5 million ($10.9 million), a decrease of NIS 1.6 million ($0.4 million), or 3.7%, compared to NIS 44.1 million ($11.3 million) for the year ended December 31, 2013. 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-8040, BL-7010 and BL-5010 in 2014.
Sales and marketing expenses for the year ended December 31, 2014 were NIS 5.7 million ($1.5 million), an increase of NIS 1.6 million ($0.4 million), or 38.6%, compared to NIS 4.1 million ($1.1 million) for the year ended December 31, 2013. The increase resulted primarily from professional fees related to increased business development activities, including professional services related to the collaboration agreement with Novartis and the out-licensing agreement with Omega regarding BL-5010.
General and administrative expenses for the year ended December 31, 2014 were NIS 13.6 million ($3.5 million), an increase of NIS 0.4 million ($0.1 million) or 2.8%, compared to NIS 13.2 million ($3.4 million) for the year ended December 31, 2013. The small increase resulted primarily from an increase in salary-related payments.
The Company’s operating loss for the year ended December 31, 2014 amounted to NIS 61.7 million ($15.9 million), compared with an operating loss of NIS 61.4 million ($15.8 million) for the year ended December 31, 2013.
The Company recognized net non-operating income of NIS 11.0 million ($2.8 million) for the year ended December 31, 2014, an increase of NIS 6.8 million ($1.7 million), compared to net non-operating income of NIS 4.2 million ($1.1 million) for the year ended December 31, 2013. Non-operating income for both periods primarily relates to fair-value adjustments of liabilities on account of warrants issued in the private and direct placements conducted in February 2012 and 2013. These fair-value adjustments were highly influenced by the Company’s share price at each period end (revaluation date).
Net financial income amounted to NIS 11.2 million ($2.9 million) for the year ended December 31, 2014, a change of NIS 15.5 million ($4.0 million), compared to net financial expenses of NIS 4.3 million ($1.1 million) for the year ended December 31, 2013. Net financial income and expenses 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 loss for the year ended December 31, 2014 amounted to NIS 39.6 million ($10.2 million), compared with a net loss of NIS 61.4 million ($15.8 million) for the year ended December 31, 2013.
The Company held NIS 134.9 million ($34.7 million) in cash, cash equivalents and short-term bank deposits as of December 31, 2014. In March 2015, the Company completed an underwritten public offering of its American Depositary Shares for gross proceeds of $28.8 million.
Net cash used in operating activities was NIS 56.4 million for the year ended December 31, 2014, compared with NIS 70.5 million for the year ended December 31, 2013. The NIS 14.1 million decrease in net cash used in operating activities during 2014 resulted primarily from a large decrease in net trade payables and accruals during the 2013 period.
Net cash used in investing activities for the year ended December 31, 2014 was NIS 70.7 million, compared to net cash used for investing activities of NIS 19.8 million for the year ended December 31, 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 year ended December 31, 2014 was NIS 117.8 million, compared to net cash provided by financing activities of NIS 55.2 million for the year ended December 31, 2013. The cash flows from financing activities in 2014 primarily reflect the underwritten public offering in March 2014 and the investment by Novartis in December 2014. The cash flows from financing activities in 2013 reflect the direct placement to OrbiMed completed in February 2013, as well as funding under the previous share purchase agreement with LPC.