Polyphor announces financial results for the full-year 2019

Polyphor AG / Key word(s): Annual Results

28-Apr-2020 / 07:00 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 KR
The issuer is solely responsible for the content of this announcement.

Allschwil, Switzerland, April 28, 2020

Polyphor announces financial results for the full-year 2019
 

- Successful start and advancement of the Phase III trial for balixafortide and oncology expansion

- Completion of the preclinical inhaled murepavadin program

- Renewed strategy for antibiotics following the stop of the murepavadin I.V. program and preclinical results for POL7306

- Cash position to finance operations into Q1 2021

Polyphor AG (SIX: POLN) a research-driven clinical-stage, Swiss biopharmaceutical company committed to discovering and developing first-in-class molecules in oncology and antimicrobial resistance today announced its financial results for the full-year of 2019.

Balixafortide - Start of the FORTRESS Phase III clinical study followed by strong progress
In June 2019, Polyphor announced that the first patient had been enrolled in the FORTRESS Phase III clinical study evaluating balixafortide (POL6326) in combination with eribulin for the treatment of patients with HER2-negative, locally recurrent or metastatic breast cancer. The study enrollment is progressing ahead of plan (264 patients randomized, 69% total) as a result of strong execution and the company expects the first data-cut for the first co-primary end point, Objective Response Rate (ORR), from the trial around end of Q1 2021, which could lead to an accelerated approval in the US, while Progression Free Survival (PFS) is expected in Q4 2021 and will be the basis for a regular Marketing Authorization submission in the US and EU.
Polyphor firmly believes that the potential positive ORR and PFS results will not only create a significant business opportunity in the initial indication but also give the opportunity to build a pipeline around balixafortide. The company plans to investigate balixafortide as a novel treatment option in earlier lines of metastatic breast cancer and tumors with other combinations beyond breast cancer. The company started a series of collaborations to generate preclinical evidence together with world-renowned institutions, such as the MD Anderson Cancer Center. Moving forward, Polyphor expects to continue to broaden academic and industry collaborations in the mid-term.
Beyond balixafortide, the company has identified a number of novel oncology targets which can be engaged by peptides from Polyphor's leading macrocycle technology platform and is currently assessing the opportunity to nominate development candidates post balixafortide's ORR results in the beginning of 2021.

Inhaled murepavadin - Completion of the preclinical program and decision to submit a Clinical Trial Application in Q4 2020
In 2019, Polyphor completed the preclinical experiments on inhaled murepavadin for the treatment of patients with cystic fibrosis (CF). The program is partially funded by the Innovative Medicines Initiative (IMI), a partnership between the European Union and the European pharmaceutical industry. Having diligently assessed the available non-clinical and translational studies suggesting significantly higher safety margins (at least 5-10 times) versus the I.V. formulation, the likelihood of inhaled murepavadin to cause kidney damage at planned doses in human is expected to be low.
As a result, a Clinical Trial Application is expected in the next 6 months (Q4 2020) and the start of a Phase I study shortly after, expanding Polyphor's clinical pipeline. If approved for commercial use, inhaled murepavadin would represent the first new class of antibiotics for Gram-negative pathogens in the last 50 years targeting specifically Pseudomonas aeruginosa bacteria.

Renewed strategy for research and preclinical antibiotic programs
In December 2019, Polyphor completed the preclinical experiments on the company's novel Outer Membrane Protein Targeting Antibiotics (OMPTA) candidate POL7306, a medium spectrum antibiotic targeting all WHO Priority 1 pathogens. Despite the promising efficacy package, the company has decided not to submit a CTA for the POL7306 program due to estimated therapeutic margins. After a thorough analysis of the learnings from the research and development efforts Polyphor has decided to reprioritize the remaining antibiotics programs with strong focus on formulation and peptide design optimization to achieve broader therapeutic margins before moving into clinical trials. In doing so, the company will apply lessons learned from the POL7306 program as well as the murepavadin I.V. program which the company has decided to stop in the beginning of 2020.
In addition, Polyphor initiated a new target program within the OMPTA class, thanatin derivatives, targeting specifically Enterobacteriaceae including multidrug resistant strains, one of the most common and resistant pathogens. Moving forward, the company seeks to continue research and development for the antibiotics pipeline with the support of existing and future non-dilutive and/or external financing to ensure external scientific validation while minimizing the cost of these programs to the cash position in the near future.

Financial results
Polyphor started 2019 with a strong financial position, that together with a swift change in the strategic direction and proactive resource allocation, enabled the company to shift strategic priorities and reallocate resources to the promising assets in oncology, cystic fibrosis and anti-infectives.
In 2019, the total loss of the period amounted to CHF 64.7 million. R&D costs increased by 36% compared to last year to a total of CHF 60.7 million. R&D costs were primarily driven by the murepavadin Phase III trials (PRISM) which were closed in July 2019 and the initiation of the pivotal trial of balixafortide (FORTRESS). Revenues decreased by CHF 6.5 million from the last reporting period which included a licensing agreement with Santhera Pharmaceuticals Ltd. This brings the company's total cash position to CHF 77.4 million (cash and cash equivalents) as of December 31, 2019, which will finance operations throughout 2020 and well into Q1 2021.

Statement on the impact of the COVID-19 outbreak
Polyphor's first priority remains the health and safety of its employees and clinical study participants. Regarding the Phase III Pivotal Study FORTRESS, the company has taken all appropriate measures to safeguard patients, study conductors, investigators and the conduct of the study in general. As continuity of the trial remains crucial for patients, investigators and the company, Polyphor will continue to take proactive measures related to COVID-19 to ensure uninterrupted supply and mitigate any impact on the study. As of end of April, the company is on schedule to complete the recruitment of 384 patients in the Fortress study by end of September 2020 and start the murepavadin inhaled study in healthy volunteers in Q4 2020.

Outlook
Commenting on the company's outlook, Polyphor CEO Gökhan Batur says: "We have demonstrated the capacity to rapidly transform our strategic priorities and build capabilities to successfully execute a Phase III oncology study that is currently ahead of plan in its enrollment and achieved positive first Data Safety Monitoring Board (DSMB) recommendation. The data readout on balixafortide is an important milestone and key priority for our company." Batur continues: "With our renewed strategy, we aspire not only to continue on our balixafortide Phase III trial, but also to establish a pipeline of potentially transformative new oncology and antibiotic candidates and new indications for balixafortide that are in clinical development in the near future. These additional efforts in progressing our mid-term pipeline in oncology and antibiotics will bring substantial benefit to patients and high value to our company and our shareholders."

Full-year 2019 results conference call at 14.00 CET on April 28, 2020
Gökhan Batur (CEO), Hernan Levett (CFO), Frank Weber (CMDO) will provide a corporate and financial update, followed by a Q&A session.

Dial-in number: (CH) +41 43 550 0244
(UK) +44 20 8089 4223
(USA) +1 334 777 6981
Conference-ID: 356411

To follow the presentation, please use the below webcast link (no audio signal):
https://webcasts.eqs.com/polyphor20200428/no-audio

Please use the following link for the audio webcast with replay function (audio and slides):
https://webcasts.eqs.com/polyphor20200428

Financial Highlights

CHF million

¹⁾ based on the consolidated IFRS financial statements
²⁾ represents the average monthly cash used in operating and investing activities

The annual report 2019 is available for download on our website: https://www.polyphor.com/investor-relations/reporting/

Next event
4 June 2020 - Annual General Meeting

For further information please contact:

For Investors:
Hernan Levett
Chief Financial Officer
Polyphor Ltd.
Tel: +41 61 567 16 00
Email: IR@polyphor.com

For Media:
Stephan Feldhaus
Feldhaus & Partner GmbH
Tel: +41 79 865 92 56
Email: feldhaus@feldhaus-partner.ch

About Polyphor
Polyphor is a research-driven clinical-stage, Swiss biopharmaceutical company committed to discovering and developing first-in-class molecules in oncology and antimicrobial resistance leveraging the company's leading macrocyclic peptide technology platform. Polyphor is advancing balixafortide (POL6326) in a Phase III trial in combination with eribulin in patients with advanced breast cancer and exploring its potential in other cancer indications. In addition, it has discovered and is developing the Outer Membrane Protein Targeting Antibiotics (OMPTA). OMPTA are potentially the first new class of antibiotics in clinical development in the last 50 years against Gram-negative bacteria. The company's lead OMPTA program is an inhaled formulation of murepavadin for the treatment of Pseudomonas aeruginosa infections in patients with cystic fibrosis. Polyphor is based in Allschwil near Basel and is listed on the SIX Swiss Exchange (SIX: POLN). For more information, please visit www.polyphor.com.

Disclaimer
This press release contains forward-looking statements which are based on current assumptions and forecasts of the Polyphor management. Known and unknown risks, uncertainties, and other factors could lead to material differences between the forward-looking statements made here and the actual development, in particular Polyphor's results, financial situation, and performance. Readers are cautioned not to put undue reliance on forward-looking statements, which speak only of the date of this communication. Polyphor disclaims any intention or obligation to update and revise any forward-looking statements, whether as a result of new information, future events or otherwise.