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Vaxart Announces Second Quarter 2018 Financial Results and Corporate Update

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Vaxart, Inc., a clinical-stage biotechnology company developing oral
recombinant vaccines that are administered by tablet rather than by
injection, today announced financial results for the second quarter
ended June 30, 2018 and provided a corporate update.

"We are encouraged by the recent publications in Vaccine and
the Journal of Clinical Investigation Insight recognizing the
unique ability of our oral recombinant vaccines to elicit both systemic
and mucosal immune responses, further validating the value of our
proprietary platform," said Wouter Latour, M.D., chief executive officer
of Vaxart. "Our team is fully focused on advancing our vaccine programs,
and we are on track to initiate our Phase 1 norovirus bivalent study and
Phase 2 norovirus challenge study later this year."

Second Quarter 2018 and Recent Highlights:

Corporate:

  • On May 31, 2018, the Company presented additional data on the
    previously disclosed Phase 1 norovirus vaccine trial in a poster
    presentation at the American Society of Microbiology 2018. As
    described in the poster, the Vaxart GI.1 norovirus tablet vaccine
    generated IgG and IgA antibodies in serum that were highly
    cross-reactive against other GI genotypes, specifically GI.3 and GI.4.
  • On June 4, 2018, Vaxart reported the topline results from a Phase 2
    clinical trial evaluating teslexivir, a small-molecule antiviral for
    the treatment of condyloma that Vaxart obtained in the acquisition of
    Aviragen earlier in 2018, in which the primary efficacy endpoint was
    not achieved.
  • On June 27, 2018, the Company announced the publication of preclinical
    results from its oral F-protein based Respiratory Syncytial Virus
    (RSV-F) vaccine in Vaccine. As described in the article, the
    oral RSV-F vaccine candidate provided complete sterilizing protection
    against RSV infection in the cotton rat challenge model at the target
    dose.
  • On July 12, 2018, Vaxart announced the publication of the
    comprehensive results of the previously disclosed Phase 1 clinical
    trial with its norovirus oral tablet vaccine in the Journal of
    Clinical Investigation Insight
    . As reported in the article, the
    vaccine generated robust systemic and mucosal immune responses,
    including mucosal IgA, memory B cells, and serum blocking antibody
    titers (BT50), all potential correlates of protection.

Second Quarter 2018 Financial Results

  • Vaxart ended the quarter with cash and cash equivalents of $23.9
    million compared to $17.5 million at March 31, 2018. The increase was
    primarily due to $12.0 million received from royalty payments offset
    by cash used in operations.
  • Revenue for the quarter was $0.6 million compared to $1.9 million in
    the second quarter of 2017. The decrease was due to lower revenues
    from the contract with HHS BARDA, where activities are winding down.
  • Research and development expenses were $5.0 million for the quarter
    compared to $4.3 million for the second quarter of 2017. The increase
    was due to additional personnel, amortization of intangibles and
    clinical trial costs resulting from the merger with Aviragen, offset
    by lower expenditures on the HHS BARDA activities and Vaxart's
    norovirus Phase 1 clinical trial.
  • General and administrative expenses were $1.8 million for the quarter
    compared to $0.7 million for the second quarter of 2017. The increase
    was due to the additional costs of being a public company, including
    the costs of additional personnel and higher legal and other services.
  • During the quarter, Vaxart recognized an impairment charge of $1.6
    million resulting from the write-off of the teslexivir intangible
    asset acquired in the merger with Aviragen.

About Vaxart

Vaxart is a clinical-stage biotechnology company focused on developing
oral recombinant protein vaccines based on its proprietary oral vaccine
platform. Vaxart's vaccines are designed to generate broad and durable
immune responses that protect against a wide range of infectious
diseases and may also be useful for the treatment of chronic viral
infections and cancer. Vaxart's vaccines are administered using a
convenient room temperature-stable tablet, rather than by injection.
Vaxart believes that tablet vaccines are easier to distribute and
administer than injectable vaccines, and have the potential to
significantly increase vaccination rates. Vaxart's development programs
include oral tablet vaccines that are designed to protect against
norovirus, seasonal influenza and respiratory syncytial virus (RSV), as
well as a therapeutic vaccine for human papillomavirus (HPV). For more
information, please visit www.vaxart.com.

Note Regarding Forward-Looking Statements

This press release contains forward-looking statements that involve
substantial risks and uncertainties. All statements, other than
statements of historical facts, included in this press release regarding
our strategy, prospects, plans and objectives, results from preclinical
and clinical trials, commercialization agreements and licenses, beliefs
and expectations of management are forward-looking statements. These
forward-looking statements may be accompanied by such words as
"believe," "could," "potential", "will" and other words and terms of
similar meaning. Examples of such statements include, but are not
limited to, statements relating to the Vaxart's ability to develop and
commercialize its product candidates and clinical results and trial
data. Vaxart may not actually achieve the plans, carry out the
intentions or meet the expectations or projections disclosed in our
forward-looking statements and you should not place undue reliance on
these forward-looking statements. Actual results or events could differ
materially from the plans, intentions, expectations and projections
disclosed in the forward-looking statements. Various important factors
could cause actual results or events to differ materially from the
forward-looking statements that Vaxart makes, that Vaxart's product
candidates may not be approved by the FDA or non-U.S. regulatory
authorities; that, even if approved by the FDA or non-U.S. regulatory
authorities, Vaxart's product candidates may not achieve broad market
acceptance; and the risks described in the "Risk Factors" sections of
Vaxart's Quarterly Reports filed on Form 10-Q and of Vaxart's other
periodic reports filed with the SEC. Vaxart does not assume any
obligation to update any forward-looking statements, except as required
by law.

 
Vaxart, Inc.
Condensed Consolidated Balance Sheets

(In thousands)

 
  June 30, 2018   December 31, 2017
(Unaudited) (1)
Assets
Cash and cash equivalents $ 23,921 $ 1,571
Short-term investments 1,415
Accounts receivable 561 630
Prepaid and other current assets 1,021 137
Property and equipment, net 1,034 730
Intangible assets, net   21,222   40  
Total Assets $ 47,759 $ 4,523  
 
Liabilities and stockholders' equity (deficit)
Accounts payable $ 1,449 $ 1,390
Accrued and other current liabilities 2,528 1,605
Liability related to sale of future royalties 17,066
Secured promissory note 4,363 4,968
Convertible promissory notes, related party     35,282  
Total liabilities 25,406 43,245
Stockholders' equity (deficit)   22,353   (38,722 )
Total liabilities and stockholders' equity (deficit) $ 47,759 $ 4,523  
 

(1)

 

Derived from the audited financial statements of Vaxart
Biosciences, Inc. for the year ended December 31, 2017, included
on the Form 8-K/A filed with the Securities and Exchange
Commission on April 2, 2018.

 
 
Vaxart, Inc.
Condensed Consolidated Statements of Operations

(In thousands, except share and per share amounts)

 
  Three Months Ended June 30,   Six Months Ended June 30,
  2018       2017     2018       2017  
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
 
Revenue $ 608   $ 1,854   $ 2,111   $ 4,164  
Operating expenses:
Research and development 5,012 4,324 8,420 $ 8,203
General and administrative 1,771 653 3,781 1,331
Impairment of intangible assets   1,600         1,600      
Total operating expenses   8,383     4,977     13,801     9,534  
Loss from operations (7,775 ) (3,123 ) (11,690 ) (5,370 )
Bargain purchase gain (328 ) 6,660
Other income and expenses, net (767 ) (415 ) (1,498 ) (694 )
Provision for income taxes   (1 )       (29 )    
Net loss $ (8,871 ) $ (3,538 ) $ (6,557 ) $ (6,334 )
Net loss attributable to common shareholders $ (8,871 ) $ (4,256 ) $ (6,896 ) $ (7,762 )
Net loss per common share, basic and diluted $ (1.24 ) $ (31.37 ) $ (1.26 ) $ (57.22 )
Shares used in computing net loss per share, basic and diluted   7,141,189     135,658     5,477,265     135,658  
 

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