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Aptose Biosciences Reports Financial Results for the Third Quarter Ended September 30, 2016SAN DIEGO and TORONTO, Nov. 14, 2016 (GLOBE NEWSWIRE) -- Aptose Biosciences Inc. (NASDAQ:APTO) (TSX:APS), a clinical-stage company developing new therapeutics and molecular diagnostics that target the underlying mechanisms of cancer, today announced unaudited financial results for the three months ended September 30, 2016 and reported on corporate developments. Unless specified otherwise, all amounts are in Canadian dollars. Net loss for the three months ended September 30, 2016 was $4.0 million ($0.31 per share) compared with $3.3 million ($0.27 per share) during the three months ended September 30, 2015. Total cash and cash equivalents at September 30, 2016 were $10.3 million. “During the third quarter of this year we focused on collecting and delivering to the U.S. Food and Drug Administration (FDA) the manufacturing information required to get our clinical trial of APTO-253 for acute myeloid leukemia (AML) back on track, as returning APTO-253 to the clinic is a major event for the company and for patients with AML,” said William G. Rice, Ph.D., Chairman, President and Chief Executive Officer. “Simultaneously, we advanced the development of CG’806, which we believe can be a transformational drug for patients with FLT3-driven AML and for patients with B cell malignancies driven by the Cys481Ser mutant of the BTK enzyme.” Corporate Highlights
Financial Results Aptose utilized cash of $3.3 million in operating activities in the three months ended September 30, 2016 compared with $2.6 million during the three months ended September 30, 2015. For the nine months ended September 30, 2016 Aptose utilized cash of $12.4 million compared with $9.0 million in the nine months ended September 30, 2015. The cash utilized in the three months ended September 30, 2016 is higher than the three months ended September 30, 2015 due to a higher net loss as well as cash used to reduce accounts payable and accrual balances in the prior year period. The cash utilized in the nine months ended September 30, 2016 increased compared to the prior year period predominantly due to an increased net loss in the current year period. Research and Development Components of research and development expenses:
The increase in program costs in the three and nine months ended September 30, 2016 compared with the three and nine months ended September 30, 2015 is due to the following reasons:
As of November 2016, Aptose and Laxai Avanti Life Sciences (LALS) have, as part of their drug discovery partnership, generated novel compounds that inhibit both the bromodomain proteins and oncogenic kinases, while improving pharmaceutical properties that could serve as a basis for further optimization towards a lead preclinical candidate. However, due to a prioritization of development efforts, Aptose and LALS have suspended work on the program, and the collaboration with LALS has been terminated. During the hiatus of this program, Aptose and LALS may choose to resume the collaboration in the future. During the nine months ended September 30, 2016, the Company paid US$1.0 million (CA$1.294 million) for an option fee related to the CG’806 technology. No comparable expense existed in the same period in the prior year. Stock-based compensation was consistent in the three months ended September 30, 2016 compared with the three months ended September 30, 2015. While the number of option grants in the current year was higher than the prior year, the fair value of those grants was lower in the current year due to a lower stock price. Stock-based compensation costs allocated to research and development increased in the nine months ended September 30, 2016 to reflect option grants to new employees hired in the second half of 2015 as the expense related to those grants was amortized 50% in the first 12 months. General and Administrative Components of general and administrative expenses:
General and administrative expenses excluding salaries, decreased in the nine months ended September 30, 2016 compared with the nine months ended September 30, 2015. The decrease is the result of lower travel, consulting and legal costs in the current year related to transactions completed in the prior year as well as lower press release and filing costs associated with a lower cost service provider in the current year periods. Salary charges in the three months ended September 30, 2016 were consistent with the prior year period as headcount was consistent year over year in the three month period. Salary charges in the nine months ended September 30, 2016 increased in comparison with the nine months ended September 30, 2015 due to additional headcount in the first half of 2016 compared with the first half of 2015 as well as a higher average CA/US exchange rate which increased the cost of our US denominated salaries in the first six months of 2016 in comparison with the prior year. Stock-based compensation decreased in the three months ended September 30, 2016 compared with the three months ended September 30, 2015 due to options granted in the current year having a lower valuation and therefore expense compared with options granted in the prior year. Stock-based compensation decreased in the nine months ended September 30, 2016 compared with the nine months ended September 30, 2015 due to large option grants in April, June and July 2014 which vested 50% during the first year and therefore contribute to higher stock-based compensation expense during the first twelve month period captured in the prior year period. Finance Expense
Interest expense for the three and nine months ended September 30, 2015 relates to interest accrued at a rate of 10% on the remaining balance of convertible promissory notes issued in September 2013 as well as accretion expense related to the conversion feature of the notes. As the promissory notes were converted before September 2015, no interest expense was incurred in 2016. Foreign exchange loss is the result of the fluctuation of exchange rates between US and Canadian dollars and the impact on our US dollar denominated cash balances. Finance Income
Interest income represents interest earned on our cash and cash equivalent and investment balances. Foreign exchange gains are the result of an increase in the value of US dollar denominated cash and cash equivalents balances during such periods due to a depreciation of the Canadian dollar compared to the US dollar.
The press release, the financial statements and the management’s discussion and analysis for the quarter ended September 30, 2016 will be available on SEDAR at www.sedar.com and EDGAR at www.sec.gov/edgar.shtml Conference Call and Webcast Aptose will host a conference call to discuss results for the three months ended September 30, 2016 tomorrow, Tuesday, November 15, 2016 at 8:30 a.m. ET. Participants can access the conference call by dialing toll-free (844) 882-7834 (North America toll free number) or (574) 990-9707 (international toll free number), using the conference call passcode 17568049. The conference call can also be accessed at http://edge.media-server.com/m/p/nndfkz6o and will be available through a link on the Investor Relations section of Aptose’s website at ir.aptose.com. Please log onto the webcast at least 10 minutes prior to the start of the call to ensure time for any software downloads that may be required. An archived version of the webcast along with a transcript will be available on the company's website for 30 days. An audio replay of the webcast will be available approximately two hours after the conclusion of the call for 7 days by dialing (855) 859-2056, using the passcode 17568049. Note The information contained in this news release is unaudited. About Aptose Aptose Biosciences is a clinical-stage biotechnology company committed to discovering and developing personalized therapies addressing unmet medical needs in oncology. Aptose is advancing new therapeutics focused on novel cellular targets on the leading edge of cancer research coupled with companion diagnostics to identify the optimal patient population for our products. The company's small molecule cancer therapeutics pipeline includes products designed to provide single agent efficacy and to enhance the efficacy of other anti-cancer therapies and regimens without overlapping toxicities. For further information, please visit www.aptose.com. Forward Looking Statements This press release contains forward-looking statements within the meaning of Canadian and U.S. securities laws. Such statements include, but are not limited to, statements that APTO-253 could return to the clinic and relating to the process to respond to the continued clinical hold that could possibly result in the clinical trial being re-initiated upon approval by the FDA, the potential of CG’806 and statements relating to the Company’s plans, objectives, expectations and intentions and other statements including words such as “continue”, “expect”, “intend”, “will”, “should”, “would”, “may”, and other similar expressions. Such statements reflect our current views with respect to future events and are subject to risks and uncertainties and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by us are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements described in this press release. Such factors could include, among others: our ability to obtain the capital required for research and operations; the inherent risks in early stage drug development including demonstrating efficacy; development time/cost and the regulatory approval process; the progress of our clinical trials; our ability to find and enter into agreements with potential partners; our ability to attract and retain key personnel; changing market conditions; uncertainty in the length of the clinical hold and the conditions the FDA may impose to remove it; potential loss of API; inability of new manufacturers to produce acceptable batches of GMP in sufficient quantities; unexpected manufacturing defects; and other risks detailed from time-to-time in our ongoing quarterly filings, annual information forms, annual reports and annual filings with Canadian securities regulators and the United States Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should the assumptions set out in the section entitled "Risk Factors" in our filings with Canadian securities regulators and the United States Securities and Exchange Commission underlying those forward-looking statements prove incorrect, actual results may vary materially from those described herein. These forward-looking statements are made as of the date of this press release and we do not intend, and do not assume any obligation, to update these forward-looking statements, except as required by law. We cannot assure you that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Investors are cautioned that forward-looking statements are not guarantees of future performance and accordingly investors are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein. Aptose Biosciences Greg Chow, CFO 647-479-9828 [email protected] SMP Communications Susan Pietropaolo 201-923-2049 [email protected] |