[The main news is the discontinuation of the hGH program because the company felt is was too little, too late. News on the Locteron program was previously reported by partner, Biolex (#msg-21566438).]
OctoPlus N.V. ("OctoPlus" or "the Company") (Euronext: OCTO), the drug delivery and development company, announces today its results for the six-month period ended 30 June 2007.
Financial and product highlights
- Promising initial results for Locteron(TM) Phase IIa clinical study
- Acquisition of full rights to PolyActive(TM) technology from IsoTis
- Contract Development revenues increased by 10% and consolidated gross revenues by 17%
- Appointment of new Scientific Advisory Board members
- Re-evaluation of product pipeline and discontinuation of growth hormone product
In July, the Company published promising initial results for Locteron's Phase IIa clinical study. The study reported an overall strong antiviral response at twelve weeks and an adverse event profile that shows substantial tolerability improvement compared to other interferons. These positive results pave the way for the start of a Phase IIb study in 2008 and full and complete study results for the Phase IIa study are anticipated in the fourth quarter of this year.
In addition, the Company acquired the full rights to the PolyActive technology and its intellectual property in certain strategic areas from IsoTis, Inc. PolyActive is the drug delivery technology used in OctoPlus' lead product Locteron. OctoPlus uses the technology to develop products that are more patient-friendly and that are potentially safer and more efficacious than currently marketed pharmaceuticals.
OctoPlus' Contract Development total gross revenues from formulation development and clinical trial material manufacturing for the first six months increased by 10% from EUR 4,112k in 2006 to EUR 4,533k in 2007. Approximately 80% of external service revenues came from repeat-orders and long-term contracts, showing the loyalty in OctoPlus' customer base.
In April, the Company announced the appointment of professor Ab Osterhaus, professor Douwe Breimer and professor Peter van Brummelen as new members to its Scientific Advisory Board. Current chairman professor Daan Crommelin and professor Wim Hennink have continued their work on the board and three members have stepped down.
Joost Holthuis, Chief Executive Officer of OctoPlus said: "We are very pleased with the results over the first six months of 2007 and the progress made with our product portfolio, in particular with the promising results of the Locteron Phase IIa study. Our acquisition of the rights to PolyActive will enable us to further build towards a successful product pipeline and we look forward to the second half of the year with confidence."
Discontinuation of growth hormone product
As part of a larger strategic evaluation of the product pipeline, OctoPlus also announces that it has discontinued the development of a controlled-release growth hormone product, hGH-OctoDEX(TM). The Company had successfully completed a Phase I study in 2004 with this product.
This decision has largely been driven by the current fast-developing, highly competitive landscape for growth hormone products. OctoPlus' product would enter the market at too late a stage to be able to generate commercially interesting revenues.
Joost Holthuis comments: "We are fully committed to successfully develop our product pipeline, which is one of the reasons why we have decided to discontinue our growth hormone product and focus on our most promising projects. The data and expertise we have generated with the growth hormone program will serve to advance our other controlled release products and our vaccines."
First half-year 2007 financial results
The table below outlines the key financial figures of the Company for the six-month period ended 30 June 2007 and 2006. These financial figures are unaudited and are in accordance with International Financial Reporting Standards, as adopted by the EU. A distinction has been made in this table between gross revenues, inter-segment revenues and consolidated (net) revenues. Gross revenues include inter-segment revenues for Contract Development supporting our Products & Drug Delivery division in the development of our own product pipeline, mainly for Locteron and OP-145. Contract Development generates most of the Company's revenues, with additional revenues from license fees and subsidies generated by our Products & Drug Delivery division.
Key figures first six months 2007 (In Euro x 1,000; except per share data)
Result per share (basic and (0.38) (0.35) 9% diluted)
Cash, cash equivalents, 11,463 3,974 188% deposits and bank overdrafts per end of period
First six months ended 30 June 2007
Over the first six months of 2007, gross revenues showed an increase of 17% to EUR 4,958k (2006: EUR 4,234k), with Contract Development's revenues increasing by 10% to EUR 4,533k (2006: 4,112) and Products & Drug Delivery's revenues increasing by 248% to EUR 425k (2006: EUR 122k). The increase in Products & Drug Delivery's revenues mainly related to higher license revenues. Inter-segment revenues for the six-month period grew from EUR 955k in 2006 to EUR 2,084k in 2007, mainly as a result of Contract Development supporting our Products & Drug Delivery division in the further development of our two products in Phase II clinical trials (Locteron and OP-145), with more support required as the development of these products progresses. In total, consolidated (net) revenues decreased by 12% to EUR 2,874k (2006: EUR 3,279k).
Total operating costs increased by 24% to EUR 9,058k (2006: EUR 7,276k), mainly as a result of the growth of the Company from 125 employees per 30 June 2006 to 153 employees per 30 June 2007.
Net loss for the period increased by 49% to EUR 6,121k (2006: net loss of EUR 4,101k).
Cash flow
The total cash, cash equivalents and deposits balance (net of bank overdrafts) has increased significantly from EUR 3,974k per 30 June 2006 to EUR 11,463k per 30 June 2007. The increase is mainly related to the Company's Initial Public Offering of 4 October 2006, with which the Company raised EUR 20 million (gross).
In the first six months of 2007, a total of EUR 6,135k of cash was used for OctoPlus' operating activities (first six months of 2006: EUR 4,679k cash outflow). The Company invested EUR 1,250k of cash in April 2007 in acquiring the full rights to the PolyActive technology from IsoTis. The remaining investing activities and the financing activities resulted in a cash outflow of EUR 705k for the first six months of 2007 (first six months of 2006: EUR 577k cash outflow). A significant part of the 2007 investments was related to construction activities for the expansion of the company headquarters in Leiden.
Outlook second half-year 2007
In line with 2007 revenue targets, the Company expects to continue the growth in Contract Development revenues during the rest of the year, but expenditures will also increase as investments in the product pipeline continue. Other milestones to be expected in 2007 are the final and complete results from the ongoing Locteron Phase IIa trial, expected in the fourth quarter, and the preparation of an IND (Investigational New Drug) application for the 2008 Locteron Phase IIb study.
Conference call and webcast presentation
On August 3, OctoPlus will hold a conference call at 10:00 AM CET. This event can also be followed during a live audio webcast via OctoPlus' website www.octoplus.nl. If you would like to participate in the conference call, please dial in on telephone number +31 45 631 6901. After the presentation of the results, Joost Holthuis, CEO of OctoPlus and Hans Pauli, CFO, will be available to answer questions. After the event, the webcast will be available for replay on the Company's website.
For further information, please contact: Rianne Roukema, Corporate Communications, +31 71 524 1071
About OctoPlus
OctoPlus N.V. is a product-oriented biopharmaceutical company committed to the creation of improved pharmaceutical products that are based on OctoPlus' proprietary drug delivery technologies and have fewer side effects, improved patient convenience and a better efficacy/safety balance than existing therapies. Rather than seeking to discover novel drug candidates through early stage research activities, OctoPlus focuses on the development of long-acting, controlled release versions of known protein therapeutics, other drugs, and vaccines.
Our pipeline consists of 4 products in preclinical and clinical development. Our lead product is Locteron, a sustained-release formulation of interferon alfa for the treatment of chronic hepatitis C, which we are co-developing with Biolex Therapeutics. Locteron is in Phase IIa clinical development. Furthermore, our pipeline comprises a product for the treatment of chronic middle ear infection also in Phase II development and two preclinical single-shot vaccines.
In addition, OctoPlus is a leading provider of advanced drug formulation and clinical scale manufacturing services to the pharmaceutical and biotechnology industry, with a focus on difficult to formulate active pharmaceutical ingredients in injectable formulations. The earnings and expertise that we derive from rendering formulation and manufacturing services help to support our own drug development programs.
OctoPlus is listed on Euronext Amsterdam under the symbol OCTO. For more information about OctoPlus, please visit our website www.octoplus.nl. <<
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