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Press release from PR Newswire

YM BioSciences Reports Operational and Financial Results for the Second Quarter of Fiscal 2012

Thursday, February 09, 2012

YM BioSciences Reports Operational and Financial Results for the Second Quarter of Fiscal 201207:03 EST Thursday, February 09, 2012 MISSISSAUGA, ON, Feb. 9, 2012 /PRNewswire/ - YM BioSciences Inc. (NYSE Amex: YMI, TSX: YM), a drug development company advancing a diverse portfolio of hematology and cancer related products, today reported operational and financial results for its second quarter of fiscal 2012, ended December 31, 2011. "JAK inhibitors may ultimately prove valuable in the treatment of a wide range of blood disorders, cancers and inflammatory diseases, representing an immense opportunity for this emerging drug class. We recently reported multicenter data for our lead JAK inhibitor, CYT387, establishing its competitive safety and efficacy profile in patients with myelofibrosis," said Dr. Nick Glover, President and CEO of YM BioSciences. "The strength of our data positions us well to select the optimal course to further advance this opportunity." Updated results from the Phase I/II study of CYT387 in 166 patients with myelofibrosis were presented in a poster session at the 53rd Annual Meeting of the American Society of Hematology held in San Diego in December 2011. CYT387 demonstrated an  ability to render and maintain anemic myelofibrosis patients transfusion independent for clinically-relevant periods while also producing significant and durable improvements in their splenomegaly and constitutional symptoms. CYT387 was generally safe and well tolerated in myelofibrosis patients for dosing periods up to and exceeding two years, with minimal treatment-related myelosuppression observed. Financial Results (CDN dollars) The interim consolidated financial statements and comparative information for the second quarter of fiscal 2012 have been prepared in accordance with International Financial Reporting Standards ("IFRS"). Previously, up to June 30, 2011, the Company prepared its Interim and Annual Consolidated Financial Statements in accordance with Canadian Generally Accepted Accounting Principles ("Canadian GAAP"). Revenue from out-licensing for the second quarter of fiscal 2012, ended December 31, 2011, was $0.4 million compared with $0.3 million for the second quarter of fiscal 2011. Revenue from out-licensing for the first six months of fiscal 2012 was $0.6 million and comparable to $0.6 million for the first six months of fiscal 2011. Net finance income was $1.5 million for the second quarter of fiscal 2012 compared to net finance costs of $4.6 million for the second quarter of fiscal 2011. Net finance income was $9.0 million for the first six months of fiscal 2012 compared to net finance costs of $8.3 million for the first six months of fiscal 2011. Under IFRS, warrants denominated in a different currency than the Company's functional currency must be classified as a financial liability and measured at fair value, with changes reflected in profit or loss. The change in net finance income during the second fiscal quarter is primarily attributed to a change of $6.0 million in the fair value adjustment for USD warrants. For the first six months of fiscal 2012, the Company incurred a gain of $7.3 million compared to a loss of $7.5 million for the six months ended December 31, 2010 on the revaluation of warrants. Licensing and product development expenses were $7.3 million for the second quarter of fiscal 2012 compared with $5.2 million for the second quarter of fiscal 2011. Licensing and product development expenses were $13.7 million for the first six months of fiscal 2012 compared with $10.9 million for the first six months of fiscal 2011. Development expenses for CYT387 increased due to the expansion of the Phase I/II clinical trial in myelofibrosis, start-up costs associated with the BID (twice-daily dosing) study, pre-clinical development activities, and manufacturing of drug for these programs. Expenses for nimotuzumab continued to decrease. General and administrative expenses were $1.2 million for the second quarter of fiscal 2012 compared to $2.7 million for the second quarter of fiscal 2011. General and administrative expenses were $3.3 million for the first six months of fiscal 2012 compared to $5.0 million for the first six months of fiscal 2011, primarily due to severance and restructuring costs in 2010. Net loss for the second quarter of fiscal 2012 was $6.6 million ($0.06 per share) compared to $12.3 million ($0.14 per share) for the same period last year. As at December 31, 2011 the Company had cash and short-term deposits totaling $67.9 million and accounts payables and accrued liabilities totaling $3.7 million compared to $79.7 million and $4.4 million respectively at June 30, 2011. Management believes that the cash and short-term deposits at December 31, 2011 are sufficient to support the Company's activities for at least the next 18 months. As at December 31, 2011 the Company had 116,711,448 common shares and 7,366,418 warrants outstanding. About YM BioSciences YM BioSciences Inc. is a drug development company advancing three products: CYT387, a small molecule, dual inhibitor of the JAK1/JAK2 kinases; nimotuzumab, an EGFR-targeting monoclonal antibody; and CYT997, a vascular disrupting agent (VDA). CYT387 is an orally administered inhibitor of both the JAK1 and JAK2 kinases, which have been implicated in a number of immune cell disorders including myeloproliferative neoplasms and inflammatory diseases as well as certain cancers. Positive interim results have been reported from a Phase I/II trial of CYT387 in 166 patients with myelofibrosis. This trial has completed enrollment while a 60 patient Phase II twice-daily dose escalation trial is currently recruiting patients. Nimotuzumab is a humanized monoclonal antibody targeting EGFR with an enhanced side-effect profile over currently marketed EGFR-targeting antibodies. Nimotuzumab is being evaluated in numerous Phase II and III trials worldwide. CYT997 is an orally-available small molecule therapeutic with dual mechanisms of vascular disruption and cytotoxicity, and has completed a Phase II trial in glioblastoma multiforme. In addition to YM's three products, the Company has several preclinical research programs underway with candidates from its library of novel compounds identified through internal research conducted at YM BioSciences Australia. This press release may contain forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such factors include, but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process or the ability to obtain drug product in sufficient quantity or at standards acceptable to health regulatory authorities to complete clinical trials or to meet commercial demand; and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting. Certain of the assumptions made in preparing forward-looking statements include but are not limited to the following: that CYT387, nimotuzumab and CYT997 will generate positive efficacy and safety data in ongoing and future clinical trials, and that YM and its various licensees will complete their respective clinical trials and disclose data within the timelines communicated in this release. Except as required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. YM BIOSCIENCES INC. Condensed Consolidated Interim Statements of Financial Position (Expressed in Canadian dollars, unless otherwise noted) (Unaudited)           December 31,  2011  June 30, 2011 July 1, 2010 Assets Current assets:    Cash and cash equivalents   $ 21,538,285  $ 32,046,630  $ 19,460,141    Short-term deposits   46,410,762  47,611,922  26,184,991    Accounts receivable   284,435  205,900  161,184    Prepaid expenses   491,612  731,676  237,962    Total current assets  68,725,094  80,596,128  46,044,278 Non-current assets:    Property and equipment    68,406  91,320  84,775    Intangible assets   4,883,690  7,137,698  11,645,714    Total non-current assets  4,952,096  7,229,018  11,730,489         Total assets  $ 73,677,190  $ 87,825,146  $ 57,774,767 Liabilities and Equity Current liabilities:    Accounts payable  $ 1,537,001  $ 1,718,893  $ 699,277    Accrued liabilities   2,170,038  2,652,511  2,085,824    Share purchase warrants   7,212,460  14,476,681  6,358,480    Deferred revenue   594,072  594,072  1,523,916    Total current liabilities  11,513,571  19,442,157  10,667,497 Non-current liabilities:    Deferred revenue   1,534,686  1,831,722  1,650,909    Total non-current liabilities  1,534,686  1,831,722  1,650,909 Equity:    Share capital    264,586,651  264,548,643  203,498,239    Contributed surplus   16,636,188  15,144,062  14,232,353    Deficit  (220,593,906)  (213,141,438)  (172,274,231)    Total equity  60,628,933  66,551,267  45,456,361         Total liabilities and equity  $ 73,677,190  $ 87,825,146  $ 57,774,767 Approved by the Board and authorized for issue on February 8, 2012: Tryon Williams, Director David G.P. Allan, Director YM BIOSCIENCES INC. Condensed Consolidated Interim Statements of Comprehensive Income (Expressed in Canadian dollars, unless otherwise noted) (Unaudited)         Three months ended December 31, Six months ended December 31,   2011 2010 2011 2010 Revenue:            Out-licensing    $ 380,117  $ 251,417  $ 630,845  $ 593,773 Expenses:            Licensing and product development   7,260,481  5,246,698  13,748,328  10,938,754    General and administrative   1,154,883  2,742,199  3,315,031  4,954,611   8,415,364  7,988,897  17,063,359  15,893,365 Loss before the undernoted   (8,035,247)  (7,737,480)  (16,432,514)  (15,299,592) Finance income   2,058,174  86,892  8,980,046   149,498 Finance costs   (580,705)  (4,679,605)  -  (8,498,335) Other income   -  24,916   -  24,916           Net loss for the period and comprehensive loss   $ (6,557,778)  $ (12,305,277)  $ (7,452,468)  $ (23,623,513) Basic and diluted loss per common share   $ (0.06)  $ (0.14)  $ (0.06)  $ (0.29) YM BIOSCIENCES INC. Condensed Consolidated Interim Statements of Changes in Equity (Expressed in Canadian dollars, unless otherwise noted) (Unaudited)   Share capital Contributed       Number  Amount  surplus  Deficit  Total Balance, July 1, 2010  80,359,623  $ 203,498,239  $ 14,232,353  $ (172,274,231)  $ 45,456,361 Net loss for the period  -  -  -  (23,623,513)  (23,623,513) Transactions with owners of the Company, recognized directly in equity:              Share-based compensation  -  -  1,044,198  -  1,044,198    Shares issued on exercise of options  319,309  425,589  (171,780)  -  253,809    Shares issued on exercise of warrants  527,343  1,599,312  -  -  1,599,312    Shares issued pursuant to prospectus offering  28,750,000  43,334,523  -  -  43,334,523 Total transactions with owners of the Company  29,596,652  45,359,424  872,418  -  46,231,842 Balance, December 31, 2010  109,956,275  $ 248,857,663  $ 15,104,771  $ (195,897,744)  $ 68,064,690              Share capital  Contributed       Number Amount surplus  Deficit Total Balance, June 30, 2011  116,681,948  $ 264,548,643  $ 15,144,062  $ (213,141,438)  $ 66,551,267 Net loss for the period  -  -  -  (7,452,468)  (7,452,468) Transactions with owners of the Company, recognized directly in equity:              Share-based compensation  -  -  1,507,684  -  1,507,684    Shares issued on exercise of options  29,500  38,008  (15,558)  -  22,450 Total transactions with owners of the Company  29,500  38,008  1,492,126  -  1,530,134 Balance, December 31, 2011  116,711,448  $ 264,586,651  $ 16,636,188  $ (220,593,906)  $ 60,628,933   YM BIOSCIENCES INC. Condensed Consolidated Interim Statements of Cash Flows (Expressed in Canadian dollars, unless otherwise noted) (Unaudited)             Three months ended December 31,     Six months ended   December 31,         2011     2010     2011     2010 Cash provided by (used in):                         Operating activities:                              Net loss for the period    $    (6,557,778)  $    (12,305,277)  $    (7,452,468)  $    (23,623,513)      Items not involving cash:                                 Depreciation of property and equipment       16,550      19,789      33,134      39,147         Amortization of intangible assets       1,127,004      1,127,004      2,254,008      2,254,008         Interest earned       (154,692)      (82,740)      (309,168)      (138,375)         Unrealized (gain) loss on cash and cash equivalents       576,919      601,654      (1,406,658)      1,010,362         Gain on disposal of property and equipment       -      -      -      (10,744)         Share-based compensation       442,030      408,145      1,507,684      1,044,198         Change in fair value of share purchase warrants       (1,903,482)      4,076,077      (7,264,221)      7,487,973   Changes in non-cash working capital balances:                                 Short-term deposits       (139,972)      (66,524)      (305,277)      (106,367)         Accounts receivable        (17,069)      (37,156)      (78,535)      (41,979)         Prepaid expenses       64,352      (370,250)      240,064      (256,716)         Accounts payable       (319,915)      718,772      (181,892)      712,684         Accrued liabilities        (393,750)      631,723      (482,473)      1,528,885         Deferred revenue       (148,518)      (148,518)      (297,036)      (451,995)   Net cash used in operating activities       (7,408,321)      (5,427,301)       (13,742,838)      (10,552,432) Investing activities:                           Proceeds from sale of short-term deposits       33,988,017      20,202,541       35,806,437      48,854,217   Purchase of short-term deposits       (33,500,000)      (48,514,540)      (34,300,000)      (76,014,540)   Interest earned       154,692      82,740       309,168      138,375   Additions to property and equipment       (5,920)      -      (10,220)      (52,694)   Net cash provided by (used in) investing activities      636,789      (28,229,259)      1,805,385      (27,074,642) Financing activities:                           Issuance of common shares on exercise of options       -      238,809      22,450      253,809   Issue of common shares on exercise warrants       -      850,159      -      850,159   Net proceeds from issuance of shares       -      43,334,523       -      43,334,523   Net cash provided by financing activities       -      44,423,491      22,450      44,438,491 Impact of foreign exchange rates on cash       (576,919)      (601,654)      1,406,658      (1,010,362) Increase (decrease) in cash and cash equivalents       (7,348,451)      10,165,277      (10,508,345)      5,801,055 Cash and cash equivalents, beginning of period       28,886,736      15,095,919      32,046,630      19,460,141 Cash and cash equivalents, end of period   $    21,538,285  $    25,261,196  $    21,538,285  $    25,261,196     SOURCE YM BioSciences Inc.For further information: <p> James Smith<br/> VP Corporate Communications<br/> YM BioSciences Inc.<br/> Tel. +1 905.361.9518<br/> <a href="mailto:jsmith@ymbiosciences.com">jsmith@ymbiosciences.com</a> </p>