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ImmunoGen Reports Recent Progress and Second Quarter 2018 Operating Results

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Mirvetuximab Soravtansine Granted Fast Track Designation by FDA

Encouraging Combination Data Reported from FORWARD II Expansion
Cohort of Mirvetuximab with Avastin
®; Initial
Data from Expansion Cohort in Combination with Keytruda
®
to be Presented at ESMO

$163 Million Net Proceeds from Public Offering Extends Cash Runway

Conference Call to be Held at 8:00 a.m. ET Today

ImmunoGen,
Inc.
, (NASDAQ:IMGN), a leader in the expanding field of
antibody-drug conjugates (ADCs) for the treatment of cancer, today
reviewed recent progress in the business and reported operating results
for the quarter ended June 30, 2018.

"During the second quarter, we made significant progress with
mirvetuximab soravtansine, highlighted by FDA Fast Track designation for
the treatment of platinum-resistant ovarian cancer, and completion of
enrollment in our FORWARD I registration study, which positions us well
to report top-line data in the first half of 2019," said Mark Enyedy,
ImmunoGen's President and Chief Executive Officer. "In addition, we
expanded the growing body of clinical data supporting mirvetuximab's
potential to treat a broader population of women with ovarian cancer in
combination with other agents. Data from our FORWARD II Avastin and
carboplatin cohorts show encouraging clinical activity and tolerability,
and support the triplet combination currently in clinical testing. We
look forward to presenting additional data for mirvetuximab and Keytruda
during 2018 with a poster presentation at ESMO that will describe the
initial findings from this expansion cohort. Looking at our
earlier-stage pipeline of novel IGN ADCs for hematological malignancies,
we expect to report data from our Phase 1 trials of IMGN779 and IMGN632
in the fourth quarter. Finally, we strengthened our financial position
with an upsized and oversubscribed public offering that generated $163
million in net proceeds and extends our cash runway at least a year
beyond the Phase 3 readout of FORWARD I."

CLINICAL PROGRESS

  • In June, the Company received U.S. Food and Drug Administration (FDA)
    Fast Track designation for mirvetuximab soravtansine for the treatment
    of patients with medium to high folate receptor alpha (FRα)-positive
    platinum-resistant ovarian cancer who received at least one, but no
    more than three prior systemic treatment regimens, and for whom
    single-agent chemotherapy is appropriate as the next line of therapy.
    This designation is intended to facilitate the development and
    expedite the review of drugs to treat serious and life-threatening
    conditions.
  • In June, the Company presented encouraging data from the FORWARD II
    expansion cohort evaluating mirvetuximab in combination with
    bevacizumab (Avastin) at the American Society of Clinical Oncology
    (ASCO) Annual Meeting, which demonstrated anti-tumor activity with
    durable responses and favorable tolerability in patients with
    platinum-resistant ovarian cancer.
  • In May, the Company reported updated data from the FORWARD II
    dose-escalation cohort evaluating mirvetuximab in combination with
    carboplatin in patients with recurrent platinum-sensitive ovarian
    cancer, demonstrating a favorable safety profile along with an
    increased response rate and more durable benefit after longer-term
    follow up.
    • The findings from the carboplatin and Avastin doublets support the
      ongoing FORWARD II cohort assessing a triplet combination of
      mirvetuximab plus carboplatin and Avastin in patients with
      recurrent platinum-sensitive ovarian.
  • In April, the Company announced it completed patient enrollment ahead
    of schedule in its FORWARD I Phase 3 trial.

RECENTLY COMPLETED PUBLIC OFFERING

  • In June, ImmunoGen completed a public offering of its common stock
    raising total net proceeds of approximately $163 million, after
    deducting underwriting discounts and offering expenses.

PARTNER UPDATES

  • In May, Takeda enrolled the first patient in its Phase 1 clinical
    trial of TAK-164, an ADC integrating ImmunoGen's IGN payload, in
    patients with gastrointestinal cancers, which triggered a milestone
    payment to ImmunoGen.

ANTICIPATED UPCOMING EVENTS

  • Report initial findings from the FORWARD II expansion cohort of
    mirvetuximab in combination with pembrolizumab (Keytruda) for 35
    patients with medium or high FRα expression at the European Society
    for Medical Oncology (ESMO) 2018 Congress in October;
  • Report additional data from IMGN779 Phase 1 dose finding study in 4Q
    2018;
  • Report initial data from IMGN632 Phase 1 dose finding study in 4Q 2018;
  • Advance ADAM9 ADC program into IND-enabling activities before
    year-end; and
  • Report top-line results from Phase 3 FORWARD I trial of mirvetuximab
    in 1H 2019.

FINANCIAL RESULTS
Revenues for the quarter ended June 30,
2018 were $9.3 million, compared with $39 million for the quarter ended
June 30, 2017. License and milestone fees of $1.3 million for the second
quarter of 2018 included $1 million and $0.3 million of recognized
upfront fees previously received from Novartis and Fusion, respectively,
compared to recognition of a $30 million paid-up license fee received
from Sanofi and a $1 million Phase 1 milestone received from CytomX for
the same quarter in 2017. The Company also received a $5 million
milestone from Takeda during the second quarter of 2018 related to the
start of Phase 1 testing of TAK-164, which was recorded as of January 1,
2018 as part of the transition to the new revenue recognition rules and
is therefore not reflected in revenue in the current period.

Revenues in the second quarter of 2018 included $7.2 million in non-cash
royalty revenues, compared with $6.4 million for the same quarter in
2017. Revenues for the second quarter of 2018 also included $0.4 million
of research and development (R&D) support fees and $0.3 million of
clinical materials revenue, compared with $0.9 million and $0.6 million,
respectively, for the same quarter in 2017.

Operating expenses for the second quarter of 2018 were $48 million,
compared with $44.2 million for the same quarter in 2017. The increase
was driven by R&D expenses, which increased to $38.7 million in the
second quarter of 2018, compared with $35.3 million for the second
quarter of 2017. This increase was primarily due to higher clinical
trial costs driven largely by continued advancement of the FORWARD I
Phase 3 clinical trial and, to a lesser extent, personnel expenses
resulting from expanded headcount and stock-based compensation. General
and administrative expenses decreased in the second quarter of 2018 to
$8.7 million, compared to $8.8 million in the same quarter of 2017.
Operating expenses for the second quarter of 2018 also included a $0.7
million restructuring charge due to the workforce reduction related to
the decommissioning of our Norwood facility as previously announced by
the Company.

ImmunoGen reported a net loss of $41.6 million, or $0.31 per basic and
diluted share, for the second quarter of 2018, compared with a net loss
of $8.9 million, or $0.10 per basic and diluted share, for the same
quarter last year.

In June 2018, pursuant to a public offering, the Company sold an
aggregate of 15.8 million shares of its common stock, with net proceeds
to the Company of $162.5 million, after deducting underwriting discounts
and offering expenses.

ImmunoGen had $345.1 million in cash and cash equivalents as of June 30,
2018, compared with $267.1 million as of December 31, 2017, and had $2.1
million of convertible debt outstanding in each period. Cash used in
operations was $85.3 million for the first six months of 2018, compared
with $8.9 million for the same period in 2017. The prior period
benefited from $55 million of fees received from Sanofi and Debiopharm.
Capital expenditures were $2.1 million and $0.8 million for the six
months ended June 30, 2018 and 2017, respectively.

FINANCIAL GUIDANCE
ImmunoGen has updated its cash and
operating expenses guidance for 2018. ImmunoGen now expects:

  • cash and cash equivalents at December 31, 2018 between $265 million
    and $270 million; and
  • operating expenses between $215 million and $220 million.

Guidance for revenue remains unchanged:

  • revenues between $60 million and $65 million.

ImmunoGen expects that its current cash combined with the expected cash
revenues from partners and collaborators will enable the Company to fund
its operations at least a year beyond the top-line results from the
Phase 3 FORWARD I trial, which are expected in the first half of 2019.

CONFERENCE CALL INFORMATION
ImmunoGen will hold a conference
call today at 8:00 am ET to discuss these results. To access the live
call by phone, dial 719-785-1753; the conference ID is 2275763. The call
may also be accessed through the Investors section of the Company's
website, www.immunogen.com.
Following the webcast, a replay of the call will be available at the
same location through August 10, 2018.

ABOUT IMMUNOGEN
ImmunoGen is developing the next generation
of antibody-drug conjugates (ADCs) to improve outcomes for cancer
patients. By generating targeted therapies with enhanced anti-tumor
activity and favorable tolerability profiles, we aim to disrupt the
progression of cancer and offer our patients more good days. We call
this our commitment to "target a better now." Our lead product
candidate, mirvetuximab soravtansine, is in a Phase 3 study for folate
receptor alpha (FRα)-positive platinum-resistant ovarian cancer, and in
Phase 1b/2 testing in combination regimens. Our novel IGN candidates for
hematologic malignancies, IMGN779 and IMGN632, are in Phase 1 studies.
Learn more about who we are, what we do, and how we do it at www.immunogen.com.

This press release includes forward-looking statements based on
management's current expectations. These statements include, but are not
limited to, ImmunoGen's expectations related to: the Company's revenues
and operating expenses for the twelve months ending December 31, 2018;
its cash and marketable securities as of December 31, 2018; the
occurrence, timing and outcome of potential pre-clinical, clinical and
regulatory events related to the Company's and its collaboration
partners' product programs; and the presentation of preclinical and
clinical data on the Company's and collaboration partners' product
candidates. For these statements, ImmunoGen claims the protection of the
safe harbor for forward-looking statements provided by the Private
Securities Litigation Reform Act of 1995. Various factors could cause
ImmunoGen's actual results to differ materially from those discussed or
implied in the forward-looking statements, and you are cautioned not to
place undue reliance on these forward-looking statements, which are
current only as of the date of this release. Factors that could cause
future results to differ materially from such expectations include, but
are not limited to: the timing and outcome of ImmunoGen's and the
Company's collaboration partners' research and clinical development
processes; the difficulties inherent in the development of novel
pharmaceuticals, including uncertainties as to the timing, expense and
results of preclinical studies, clinical trials and regulatory
processes; ImmunoGen's ability to financially support its product
programs; ImmunoGen's dependence on collaborative partners; industry
merger and acquisition activity; and other factors more fully described
in ImmunoGen's Annual Report on Form 10-K for the year ended December
31, 2017 and other reports filed with the Securities and Exchange
Commission.

Avastin® and Keytruda® are registered trademarks
of their respective owners.

 
ImmunoGen, Inc. Reports Financial Results for Quarter and Six Months
Ended June 30, 2018
             
IMMUNOGEN, INC.
SELECTED FINANCIAL INFORMATION
(in thousands, except per share amounts)
 
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
June 30, December 31,
2018 2017
ASSETS
 
Cash and cash equivalents $ 345,058 $ 267,107
Other assets   36,026     27,569  
 
Total assets $ 381,084   $ 294,676  
 
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
 
Current portion of deferred revenue $ 1,020 $ 1,405
Other current liabilities 62,328 54,365
Long-term portion of deferred revenue 80,751 93,752
Other long-term liabilities 147,795 163,049
Shareholders' equity (deficit)   89,190     (17,895 )
 
Total liabilities and shareholders' equity (deficit) $ 381,084   $ 294,676  
 
 
 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2018   2017 2018   2017
 
Revenues:
License and milestone fees $ 1,321 $ 31,080 $ 12,861 $ 49,810
Non-cash royalty revenue 7,242 6,439 14,432 14,052
Research and development support 388 902 771 2,380
Clinical materials revenue   336     599   1,038   1,277  
 
Total revenues   9,287     39,020   29,102   67,519  
 
Expenses:
Research and development 38,701 35,319 83,532 68,207
General and administrative 8,652 8,836 18,647 16,955
Restructuring charge   686     -     2,417     386  
 
Total operating expenses   48,039     44,155   104,596   85,548  
 
Loss from operations (38,752 ) (5,135 ) (75,494 ) (18,029 )
 
Non-cash interest expense on liability related to sale of future
royalty & convertible bonds
(2,611 ) (3,501 ) (5,657 ) (7,076 )
Interest expense on convertible bonds (23 ) (1,125 ) (47 ) (2,250 )
Other (loss) income, net   (238 )   894   961   1,143  
 
Net loss $ (41,624 ) $ (8,867 ) $ (80,237 ) $ (26,212 )
 
Net loss per common share, basic and diluted $ (0.31 ) $ (0.10 ) $ (0.61 ) $ (0.30 )
 
 
Weighted average common shares outstanding, diluted   134,384     87,174     132,512     87,167  

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