MOLOGEN AG with positive developments in the first half of 2018: successful financing measures and continuation of clinical studies

DGAP-News: MOLOGEN AG / Key word(s): Half Year Results

09.08.2018 / 07:15

The issuer is solely responsible for the content of this announcement.


Press Release No 17 / 2018 dated 08/09/2018

MOLOGEN AG with positive developments in the first half of 2018: successful financing measures and continuation of clinical studies

– Ongoing clinical studies with lefitolimod on track, new studies in preparation

– License and development cooperation agreement signed with ONCOLOGIE; initial revenues generated under license agreement

– Dr Ignacio Faus new Chief Executive Officer (CEO) since 1 August 2018

– Successful financing measures

– Forecast for fiscal year 2018 confirmed

Berlin, 9 August 2018 – In the first half of 2018 the biopharmaceutical company MOLOGEN AG recorded a positive development in many respects. The “Next Level” corporate strategy continued to be implemented according to schedule in the first half of the year. The most important strategic milestone was the conclusion of the license and development cooperation agreement with the U.S. drug development company ONCOLOGIE. Under the agreement, MOLOGEN received an initial license payment of EUR3 million. The financing measures implemented in the fourth quarter of 2017 and in the reporting period – a framework agreement on convertible bonds of up to EUR12 million and a cash capital increase with gross proceeds of around EUR5 million – will initially secure the Company’s financing plans until the end of 2018. As a result of the reverse stock split in July 2018, MOLOGEN will be able to make use of the financing instruments already agreed.

The clinical studies with MOLOGEN’s lead compound, the immunotherapeutic lefitolimod, also proceeded according to plan. In particular, the time of evaluation of the colorectal cancer study IMPALA was substantiated and the final evaluation of the explorative phase II study IMPULSE in the indication of small cell lung cancer was performed. Here the positive signals of the initial evaluation in predefined subgroups were confirmed. In addition, new studies in various indications are in preparation, including the TITAN study in the indication HIV. MOLOGEN also presented the first impressive preclinical data on lefitolimod and its follow-up molecules EnanDIM(R) in the field of immuno-oncology and tumor microenvironment (TME).

Dr Ignacio Faus has taken over the CEO position of MOLOGEN AG since 1 August. He succeeds Dr Mariola Söhngen, who decided not to extend her contract for personal reasons.

“I’m delighted to be on board such an exciting company as MOLOGEN and to be able to contribute my experience in the pharmaceutical sector. In the last six months, many positive things have happened at MOLOGEN: we concluded the first license agreement for the lead compound lefitolimod, successfully implemented important measures to secure corporate financing and continued to drive the clinical trials forward as planned. My goal is to enter into further partnerships with pharmaceutical companies and to bring MOLOGEN’s innovative products to market maturity as quickly as possible,” said Dr Ignacio Faus, CEO of MOLOGEN AG.

Progress in ongoing clinical studies and further studies at the planning stage
In the first half of 2018, MOLOGEN’s operating activities continued to focus on clinical studies with its lead compound, the TLR9 agonist lefitolimod. The preparatory activities for possible approval of the immunotherapeutic agent have made progress. MOLOGEN also made further advances in its ongoing clinical studies with lefitolimod: the pivotal study IMPALA in colorectal cancer (mCRC) proceeded according to plan. In April 2018, a first data-based prediction of the expected time of primary evaluation of the IMPALA study was announced. Based on the patient data collected until April 2018 and using adequate statistical methods, the timing of the results at the primary endpoint of the study is predicted for April 2020 plus/minus five months. It is therefore highly likely that the study results will be evaluated between the end of 2019 and summer of 2020.

The exploratory phase II study IMPULSE in the indication of small cell lung cancer (SCLC), the main results of which MOLOGEN had already published in April 2017, was finally evaluated in the first quarter of 2018. The positive results already presented were confirmed in predefined patient subgroups. The study showed remarkable overall survival results in two relevant patient subgroups compared to the control group. The results support the hypothesis that activated B cells as biomarkers can contribute to the future development of lefitolimod in this relevant subgroup of patients with small cell lung cancer in advanced stages.
In the indication HIV, detailed study results from the extension phase of the TEACH study, which was primarily evaluated in August 2017, were presented at the Conference on Retroviruses and Opportunistic Infections (CROI) in Boston. In accordance with the further development strategy in the indication HIV, lefitolimod is to be used in combination therapies. The “TITAN” combination study already financed by the renowned U.S. pharmaceutical company Gilead Sciences is currently being prepared. As in the previous TEACH study, the study will be conducted in collaboration with the Aarhus University Hospital in Aarhus, Denmark. Further new studies in various indications are also in preparation.

Patient recruitment for the phase I combination study with the checkpoint inhibitor Yervoy(R) in collaboration with the MD Anderson Cancer Center in Texas is also making further progress. It is expected that the first part of the study to evaluate the safety of the combination of lefitolimod with checkpoint inhibitors and the determination of the highest tolerated dose of lefitolimod will be completed by 2018. The study will then be continued in 2019 to explore further insights into the combination of lefitolimod with checkpoint inhibitors.

In April, MOLOGEN presented impressive preclinical tumor microenvironment data on lefitolimod and its follow-up molecules EnanDIM(R) at the AACR conference (American Association for Cancer Research) in Chicago and at the ASCO GI (Annual Gastrointestinal Cancers Symposium) in San Francisco in January. Accordingly, monotherapy with lefitolimod leads to an advantageous modulation of the tumor microenvironment, which is accompanied by reduced tumor growth in a colorectal cancer model. These results underscore the strong potential of lefitolimod as a cancer immunotherapeutic agent.

Most important strategic milestone reached: first license agreement for lefitolimod
In February 2018, MOLOGEN reached a significant strategic milestone and signed a license and development cooperation agreement for lefitolimod with the U.S. drug developer ONCOLOGIE. This includes the development, production and commercialization of lefitolimod in the markets of China including Hong Kong, Macau as well as Taiwan and Singapore and a global development cooperation. Under the terms of the contract concluded, MOLOGEN has already received an initial payment of EUR3 million. In addition, a capital contribution of EUR2 million by February 2019 at the latest as well as development and sales-related milestone payments and royalties have been agreed. Further partnerships are to follow.

Successful financing measures and capital consolidation
Further corporate financing was also a focus of MOLOGEN’s activities in the first half of 2018. Three capital measures were implemented in the first quarter: initially, a second capital increase took place in the course of the exercise of the share subscription agreement entered into in October 2017 with the US investor Global Corporate Finance (GCF). This second exercise generated gross proceeds of EUR445,000 for MOLOGEN. In combination with the first exercise, MOLOGEN thus received around EUR1 million.

This was followed by a rights issue of EUR5 million from authorized capital, which was successfully completed and fully placed in March 2018.

On 20 February 2018, MOLOGEN concluded a contract with the Luxembourg-based financing provider European High Growth Opportunities Securitization Fund (EHGO), which is advised by Alpha Blue Ocean Advisors. Under this agreement, MOLOGEN can call convertible bonds with a total value of up to EUR12 million in 24 tranches of EUR500,000 each from the investor over a period of two years. So far, MOLOGEN has drawn down two tranches (in March 2018). These have already been fully converted by EHGO. In total, the Company thus received approx. EUR6.5 million in cash and cash equivalents in the reporting period.

In mid-July the 5:1 capital consolidation under a resolution adopted at the MOLOGEN Annual General Meeting on 8 June 2018 was implemented. Since then, the Company’s share capital has reached EUR7,537,287, divided into 7,537,287 bearer shares (before capital consolidation: 37,686,439 shares). The reverse stock split will make MOLOGEN financially viable again and the financing measures already agreed can continue to be implemented.

The capital measures and framework agreements implemented in the fourth quarter of 2017 and in the first quarter of 2018 are expected to allow the financing of the Company until the end of 2018.

Lower research and development expenses and significant improvement in earnings
Research & development costs in the first half of 2018 amounted to EUR5.6 million, 30 percent lower than in the same period last year (previous year: EUR8.0 million). This development was due to lower R&D expenses due to the completion of two of the clinical studies. The operating result (EBIT) also improved significantly to -EUR4.5 million (previous year: -EUR10.5 million) due to the first licensing revenue resulting from the cooperation with ONCOLOGIE. As at 30 June 2018, MOLOGEN AG had cash & cash equivalents amounting to EUR6.2 million (31 December 2017: EUR6.5 million).

Personnel changes on the Executive Board and Supervisory Board
At personnel level, MOLOGEN AG announced in April that the CEO Dr Mariola Söhngen would not extend her contract, which expires on 31 October 2018, for personal reasons. Her successor Dr Ignacio Faus was appointed to the Executive Board as of 1 August 2018 and has assumed the role of CEO of MOLOGEN AG. Dr Faus has gained more than 25 years’ experience in the life sciences industry and contributes valuable expertise in areas such as fundraising, organizational planning, strategic project evaluation, operational efficiency, business development & licensing (BD&L). In 2006 he was one of the founders of PALAU PHARMA, a biopharmaceutical company in the field of inflammatory and autoimmune diseases. In his function as CEO of MOLOGEN, Dr Faus is responsible for Business Development, Investor Relations & Corporate Communications, Partnering, Production and Strategy.

In addition, Dr Michael Schultz, independent expert and consultant for pharmaceutical and biotechnology companies, was elected as a new member of the Supervisory Board of MOLOGEN AG at the 2018 Annual General Meeting.

Forecast for full-year 2018 confirmed
Based on the progress planned for 2018 in all divisions, primarily in clinical development programs and commercialization, the Company expects positive development in 2018. Overall, the Executive Board of MOLOGEN AG confirms the statements made in the 2017 Annual Report regarding the targets in the areas of research and development, cooperations and partnerships, earnings and liquidity development as well as personnel for the entire 2018 financial year, with the exception of subsequent additions. Due to its activities, some of which were launched later, particularly in the area of contract manufacturing, the Company now assumes that the financial requirements in the 2018 financial year will be at a comparable level or below those of the preceding year.

MOLOGEN AG’s complete 2018 half-year report is available on the Company’s website at www.mologen.com.

MOLOGEN AG
MOLOGEN AG is a biopharmaceutical company and a pioneer in the field of immunotherapy on account of its unique active agents and technologies. Alongside a focus on immuno-oncology, MOLOGEN develops immunotherapies for the treatment of infectious diseases.
The focus of the development work is on the product family of DNA-based TLR9 agonists. This includes the lead compound lefitolimod and the next-generation molecule family EnanDIM(R).

The immunotherapeutic agent lefitolimod is the Company’s lead compound and is currently being investigated in a pivotal trial. It is regarded as the best-in-class TLR9 agonist. Treatment with lefitolimod triggers a broad and strong activation of the immune system. On account of this mode of action, lefitolimod could potentially be used in various indications. Lefitolimod is currently being developed within the framework of a pivotal study for first line maintenance therapy for colorectal cancer. Key data of the phase II IMPULSE study in small cell lung cancer have been announced in April 2017, and the final analysis in the first quarter 2018 confirmed the data. Furthermore, data from the extension phase of the TEACH study in HIV have also been published in 2017. In addition, lefitolimod is currently being investigated in a phase I combination study with the checkpoint inhibitor ipilimumab (Yervoy(R)) in various cancer indications. Along with various checkpoint inhibitors, lefitolimod, which is being investigated as part of a phase III clinical trial currently, is one of the few near-to-market product candidates in the field of immuno-oncology.
MOLOGEN’s pipeline focus is on new innovative immunotherapies to treat diseases for which there is a great medical demand in particular.

MOLOGEN AG is a publicly listed Company, headquartered in Berlin. The shares (ISIN, DE000A2LQ900/SIN: A2L Q90) are listed in the Prime Standard of the German Stock Exchange.
www.mologen.com

Contact

Claudia Nickolaus
Head of Investor Relations & Corporate Communications
Tel: +49 – 30 – 84 17 88 – 38
Fax: +49 – 30 – 84 17 88 – 50
investor@mologen.com

Note about risk for future predictions
Certain information in this report contains forward-looking statements or the corresponding statements with negation or versions deviating from this or comparable terminology. These are described as forward-looking statements. In addition, all of the information given here that refers to planned or future results of business areas, key financial figures, developments of the financial situation or other financial figures or statistical data, is to be understood as such forward-looking statements. The company points out to investors that they should not rely on these forward-looking statements as predictions about actual future events. The company is not obligated and refuses to accept any liability for the forward-looking statements and has no obligation to update such statements in order to accurately reflect the current situation.


09.08.2018 Dissemination of a Corporate News, transmitted by DGAP – a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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Language: English
Company: MOLOGEN AG
Fabeckstraße 30
14195 Berlin
Germany
Phone: 030 / 841788-0
Fax: 030 / 841788-50
E-mail: presse@mologen.com
Internet: www.mologen.com
ISIN: DE000A2LQ900
WKN: A2LQ90
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate Exchange

 
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