Helix BioPharma Corp. Announces Fiscal Third Quarter 2018 Results

RICHMOND HILL, Ontario, June 12, 2018 (GLOBE NEWSWIRE) -- Helix BioPharma Corp. (TSX:HBP) (FRANKFURT:HBP) (“Helix” or the “Company”), a clinical stage immuno-oncology company developing innovative drug candidates for the prevention and treatment of cancer, announces its financial results for its fiscal quarter ended April 30, 2018.

FINANCIAL REVIEW

The Company recorded a net loss and total comprehensive loss of $2,147,000 ($0.02 loss per common share) and $2,913,000 ($0.03 loss per common share) for the three-month periods ended April 30, 2018 and 2017, respectively.  For the nine-month periods ended April 30, 2018 and 2017, respectively, the Company recorded a net loss and total comprehensive loss of $7,105,000 ($0.07 loss per common share) and $8,819,000 ($0.10 loss per common share).

Research and development

Research and development costs for the three and nine-month periods ended April 30, 2018 totalled $1,435,000 and $5,095,000, respectively ($1,932,000 and $6,111,000 respectively for the three and nine-month periods ended April 30, 2017).

The following table outlines research and development costs expensed and investment tax credits for the Company’s significant research and development projects for the following periods:

               
  For the three-month
periods ended April 30
  For the nine-month
periods ended April 30
 
   2018  2017   2018  2017 
L-DOS47 $1,029 $1,028  $4,039 $4,480 
V-DOS47  133  309   310  659 
CAR-T  192  259   317  259 
Corporate research and development expenses  122  170   346  672 
Trademark and patent related expenses  70  75   308  197 
Stock-based compensation expense  2     8   
Depreciation expense  31  13   111  82 
Research and development investment tax credits    (10    (10
Polish grant government funding (V-DOS47)  (144) (92)  (344) (228)
  $1,435 $1,932  $5,095 $6,111 
               

L-DOS47 research and development expenses for the three and nine-month periods ended April 30, 2018 totalled $1,029,000 and $4,039,000, respectively ($1,208,000 and $4,480,000 respectively for the three and nine-month periods ended April 30, 2017).  L-DOS47 research and development expenditures relate primarily to the Company’s LDOS002 European Phase I/II clinical study in Poland, its LDOS001 Phase I clinical study in the U.S., preliminary expenditures related to the Company’s LDOS003 Phase II clinical study in Poland and the Ukraine and various other expenditures in support of the Company’s overall L-DOS47 program.

The Company’s LDOS001 clinical study has been facing patient enrolment challenges and as a result the Company most recently increased start-up activities to add 6 additional clinical study sites, with planned recruitment to begin mid-summer 2018. In addition, an accelerated dosing protocol has been approved to help accelerate the LDOS001 clinical study. On May 30th, 2018, the Company announced the completion of the third cohort and the initiation of enrollment in the fourth cohort of the LDOS001 clinical study.  Enrolment in the Company’s LDOS002 clinical study was previously terminated due to lack of efficacy and the Company is currently awaiting the finalized reports. Given the limited cash resources, the Company has slowed down the previously committed LDOS003 clinical trial which the Company previously planned to commence enrolment in early 2018.

V-DOS47 research and development expenses for the three and nine-month periods ended April 30, 2018 totalled $133,000 and $310,000, respectively ($309,000 and $659,000 respectively for the three and nine-month periods ended April 30, 2017).  For the three and nine-month periods ended April 30, 2018 the Company’s Polish subsidiary received grant funding of $144,000 and $344,000, respectively ($92,000 and $228,000 respectively for the three and nine-month periods ended April 30, 2017).  The higher expenditures in the prior year mainly reflect the increase in staff and consulting agreements as the Polish subsidiary ramped up activities in the V-DOS47 program.  The Company’s wholly owned subsidiary in Poland has entered into a grant funding agreement with the Polish National Centre for Research and Development for research and development expenditures associated with V-DOS47. 

CAR-T research and development expenses for the three and nine-month periods ended April 30, 2018 totalled $192,000 and $317,000 respectively ($259 and $259 respectively for the three and nine-month periods ended April 30, 2017).  During the current fiscal year, the Company commenced development of novel CAR-T therapeutics and new antibody-based technologies for cell-based therapies.  The Company’s CAR-T expenditures relate primarily to collaborative research activities with ProMab Biotechnologies Inc.

Corporate research and development expenses for the three and nine-month periods ended April 30, 2018 totalled $122,000 and $346,000 respectively ($170,000 and $672,000 respectively for the three and nine-month periods ended April 30, 2017).  Corporate research and development expenditures mainly reflect wages and benefits and related expenses associated with corporate head office staff.  The reduction mainly reflects lower wages because of cost cutting initiatives to reduce headcount and third-party consulting costs.

Trademark and patent related expenses for the three and nine-month periods ended April 30, 2018 totalled $70,000 and $308,000, respectively ($75,000 and $197,000 respectively for the three and nine-month periods ended April 30, 2017).  The Company continues to ensure it adequately protects its intellectual property.

Operating, general and administration

Operating, general and administration expenses for the three and nine-month periods ended April 30, 2018 totalled $686,000 and $1,856,000, respectively ($944,000 and $2,826,000 respectively for the three and nine-month periods ended April 30, 2017). The decrease in operating, general and administration expenses reflects the Company’s cost cutting initiatives.  The Company eliminated the employment arrangement with its then CEO, who was also a director of the Company, and let go of its controller as part of a headcount reduction plan.  Aggressive steps were also taken to reduce unnecessary expenditures such as travel, conferences, etc.  In addition, various third-party contracts were also eliminated.  During the fiscal quarter, the Company hired Deloitte as strategic advisor to explore partnering and licensing opportunities.  Cost reductions taken at the head office were partially offset by operating, general and administrative expenditures being incurred at the Company’s newly formed subsidiary in Poland which mainly reflect salaries and benefits, legal and accounting services and overhead costs associated with the administrative office.

The following table outlines operating, general and administration costs expensed for the following periods:

               
  For the three-month
periods ended April 30
  For the nine-month
periods ended April 30
 
   2018  2017   2018  2017 
Wages and benefits $215 $256  $493 $987 
Director fees  13  50   148  132 
Third-party advisors  320  483   779  1,096 
Other general and administrative  133  151   420  578 
Stock-based compensation expense         19 
Depreciation expense  5
  4
   16  14 
  $686 $944  $1,856 $2,826 
               

LIQUIDITY AND CAPITAL RESOURCES

The Company recorded a net loss and total comprehensive loss of $2,147,000 ($0.02 loss per common share) and $2,913,000 ($0.03 loss per common share) for the three-month periods ended April 30, 2018 and 2017, respectively.  For the nine-month periods ended April 30, 2018 and 2017, respectively, the Company recorded a net loss and total comprehensive loss of $7,015,000 ($0.07 loss per common share) and $8,819,000 ($0.10 loss per common share).

As at April 30, 2018 the Company had a working capital deficiency of $1,915,000, a shareholders’ deficiency of $1,507,000 and a deficit of $162,395,000.  As at July 31, 2017 the Company had a working capital deficiency of $504,000, shareholders’ deficiency of $17,000 and a deficit of $155,380,000.

The Company continues to work with vendors to manage its cash position while ensuring vendors continue providing services while being paid, albeit over a longer period of time than previously agreed terms.  The Company has raised approximately $6,913,000 from private placement financings during the current fiscal year.  Nevertheless, the Company’s cash reserves of $770,000 as at April 30, 2018 in addition to the subsequent private placement on June 7, 2018 for gross proceeds of approximately $941,000 are insufficient to meet anticipated cash needs for working capital and capital expenditures through the next twelve months, nor are they sufficient to see the current or any planned research and development initiatives through to completion.  Though the funds raised have somewhat assisted the Company in dealing with its working capital deficiency and attempts to make vendors current, additional funds are required to advance the various clinical and preclinical programs, pay for the Company’s overhead costs and its past due vendors.  To the extent that the Company does not believe it has sufficient liquidity to meet its current obligations, management considers securing additional funds, primarily through the issuance of equity securities of the Company, to be critical for its development needs.

Additional information can be found about the Company’s liquidity and capital resources in the Company’s Management Discussion and Analysis.

The Company’s condensed unaudited interim consolidated statement of net loss and comprehensive loss for the three and nine-month periods ending April 30, 2018 and 2017 and the condensed unaudited interim consolidated statement of cash flows for the nine-month periods ending April 30, 2018 and 2017 are summarized below:

 
 Consolidated Statements of Net Loss and Comprehensive Loss    Consolidated Statements of Cash Flows  
 (thousand $, except for per share data)       (thousand $)   
              
  For the three-month
periods ended
 For the nine-month
periods ended
    For the nine-month
periods ended
 
        
  Apr 30 Apr 30  Apr 30 Apr 30     Apr 30 Apr 30  
   2018  2017   2018  2017     2018 2017  
              
              
 Expenses:         Cash provided by (used in):   
   Research and development   1,435    1,932     5,095    6,111      Net loss and total comprehensive loss (7,015) (8,819) 
   Operating, general, administration   686    944     1,856    2,826        
   Gain on Sale of Capital Assets   -     -      -     (137)   Items not involving cash:   
 Results from operating activities          Depreciation  116   94  
before finance items  (2,121)  (2,876)   (6,951)  (8,800)     Stock-based compensation  8   19  
            Gain from sale of capital assets  -    (137) 
 Finance items    (26)   (37)    (64)   (19)     Foreign exchange loss   54   (12) 
              
              
 Loss and total comprehensive loss  (2,147)  (2,913)   (7,015)  (8,819)     (6,837) (8,855) 
              
 Loss per share $  0.02 $  0.03  $  0.07 $  0.10    Changes in non-cash working capital  1,284   2,564  
              
 * Figures are for both basic and fully diluted       Operating activities (5,553) (6,291) 
              
          Financing activities  5,517   4,134  
              
          Investing activities  (37)  (186) 
              
          Exchange rate changes on cash  (54)  12  
              
          Net decrease in cash  (127) (2,331) 
              
          Cash beginning of the period  897   3,654  
              
          Cash end of the period  770   1,323  
              
       

The Company’s Consolidated Statement of Financial Position as at April 30, 2018 and July 31, 2017 are summarized below.

     
 Consolidated Statement of Financial Position (thousand $) 
     
  30-Apr-18 31-Jul-17  
     
 Non current assets   408   487  
     
 Current assets:    
 Prepaids   174   173  
 Accounts receivable   362   630        
 Cash   770   897  
    1,306   1,700  
     
 Total assets   1,714   2,187  
     
 Shareholders' equity / (deficiency)  (1,507)  (17) 
     
 Current liabilities:    
 Deferred government grant  41   44  
 Accrued liabilities   534   722  
 Accounts payable   2,646   1,438  
    3,221   2,204  
     
 Total liabilities & shareholders equity  1,714   2,187  
     
     

The Company’s condensed unaudited interim consolidated financial statements and management’s discussion and analysis will be filed under the Company’s profile on SEDAR at www.sedar.com, as well as on the Company’s website.

About Helix BioPharma Corp.

Helix BioPharma Corp. is an immuno-oncology company specializing in the field of cancer therapy. The company is actively developing innovative products for the prevention and treatment of cancer based on its proprietary technologies. Helix’s product development initiatives include its novel L-DOS47 new drug candidate and Chimeric Antigen Receptor (“CAR”) based cell therapies. Helix is currently listed on the TSX and FSE under the symbol “HBP”.

INVESTOR RELATIONS

Helix BioPharma Corp.
9120 Leslie Street, Suite 205
Richmond Hill, Ontario, L4B 3J9
Tel: (905) 841-2300
Email: ir@helixbiopharma.com

Forward-Looking Statements and Risks and Uncertainties

This news release contains forward-looking statements and information (collectively, “forward-looking statements”) within the meaning of applicable Canadian securities laws. Forward-looking statements are statements and information that are not historical facts but instead include financial projections and estimates, statements regarding plans, goals, objectives, intentions and expectations with respect to the Company’s future business, operations, research and development, including the Company’s activities relating to DOS47, and other information in future periods.

Forward-looking statements include, without limitation, statements concerning (i) the Company’s ability to operate as a going concern being dependent mainly on obtaining additional financing; (ii) the Company’s priority continuing to be L-DOS47; (iii) the Company’s development programs for DOS47, L-DOS47, V-DOS47 and CAR-T; (iv) future expenditures, the insufficiency of the Company’s current cash resources and the need for financing; and (v) future financing requirements and the seeking of additional funding. Forward-looking statements can further be identified by the use of forward-looking terminology such as “ongoing”, “estimates”, “expects”, or the negative thereof or any other variations thereon or comparable terminology referring to future events or results, or that events or conditions “will”, “may”, “could”, or “should” occur or be achieved, or comparable terminology referring to future events or results.

Forward-looking statements are statements about the future and are inherently uncertain, and are necessarily based upon a number of estimates and assumptions that are also uncertain. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Forward-looking statements, including financial outlooks, are intended to provide information about management’s current plans and expectations regarding future operations, including without limitation, future financing requirements, and may not be appropriate for other purposes. Certain material factors, estimates or assumptions have been applied in making forward-looking statements in this news release, including, but not limited to, the safety and efficacy of L-DOS47; that sufficient financing will be obtained in a timely manner to allow the Company to continue operations and implement its clinical trials in the manner and on the timelines anticipated; the timely provision of services and supplies or other performance of contracts by third parties; future costs; the absence of any material changes in business strategy or plans; and the timely receipt of required regulatory approvals and strategic partner support.

The Company’s actual results could differ materially from those anticipated in the forward-looking statements contained in this news release as a result of numerous known and unknown risks and uncertainties, including without limitation, the risk that the Company’s assumptions may prove to be incorrect; the risk that additional financing may not be obtainable in a timely manner, or at all, and that clinical trials may not commence or complete within anticipated timelines or the anticipated budget or may fail; third party suppliers of necessary services or of drug product and other materials may fail to perform or be unwilling or unable to supply the Company, which could cause delay or cancellation of the Company’s research and development activities; necessary regulatory approvals may not be granted or may be withdrawn; the Company may not be able to secure necessary strategic partner support; general economic conditions, intellectual property and insurance risks; changes in business strategy or plans; and other risks and uncertainties referred to elsewhere in this news release, any of which could cause actual results to vary materially from current results or the Company’s anticipated future results. Certain of these risks and uncertainties, and others affecting the Company, are more fully described in the Company’s annual management’s discussion and analysis for the year ended July 31, 2017 under the heading “Risks and Uncertainty” and Helix’s Annual Information Form, in particular under the headings “Forward-looking Statements” and “Risk Factors”, and other reports filed under the Company’s profile on SEDAR at www.sedar.com from time to time. Forward-looking statements and information are based on the beliefs, assumptions, opinions and expectations of Helix’s management on the date of this new release, and the Company does not assume any obligation to update any forward-looking statement or information should those beliefs, assumptions, opinions or expectations, or other circumstances change, except as required by law.

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