MISSION VIEJO, CA -- (Marketwired) -- 02/14/14 -- Aeolus Pharmaceuticals, Inc. (OTCQB: AOLS), a biotechnology company developing compounds to protect against radiological and chemical threats with significant funding from the US Government, announced today financial results for the three months ended December 31, 2013.
The Company reported a net loss of approximately $695,000, or $0.01 per share for the three months ended December 31, 2013. This compares to a net profit of $4,028,000, or $0.03 per share, which includes a non-cash adjustment of approximately $4,510,000 related to decreases in the fair value of warrants that are included as a component of other income (expenses) in the statement of operations, for the three months ended December 31, 2012.
"During the quarter, we announced positive data from studies demonstrating that AEOL 10150 significantly improves survival and protects lungs in mice exposed to lethal radiation. This data builds on the growing body of positive data that we hope will form the basis of a pre-Emergency Use Authorization application later this year," stated John L. McManus, President and Chief Executive Officer. "We also filed a new provisional patent application that, if granted, would substantially increase the life of the patent protection surrounding AEOL 10150. Work under the contract is expected to accelerate during the second quarter as we expect to initiate up to 6 murine efficacy studies, continue a large non-human primate efficacy study, finalize process development and validation of our drug substance and prepare our IND filing for lung acute radiation syndrome."
Revenue for the three months ended December 31, 2013 was approximately $793,000, which compares to revenue of $1,342,000 for the three months ended December 31, 2012. The revenue is from the contract with BARDA announced on February 11, 2011. Lower revenue in 2013 reflects both the timing of the initiation of program items as well as revenue recognition under accounting rules.
Research and development expenses decreased to approximately $707,000 for the three months ended December 31, 2013, from approximately $1,169,000 for the three months ended December 31, 2012. The decrease in 2013 expenses reflects both the timing of the initiation of program items under the BARDA contract as well as expense recognition under accounting rules.
General and administrative expenses were approximately $781,000 for the three months ended December 31, 2013 compared to approximately $655,000 for the three months ended December 31, 2012. The higher expense was primarily due to stock option expense.
Key accomplishments during the quarter include:
- Announced data from BARDA-funded studies demonstrating AEOL-10150 increased survival at 180 days from 10% to 40% in mice receiving lethal irradiation
- Filed a provisional patent application covering novel synthesis routes, crystal forms and pharmaceutical compositions of AEOL 10150 and related porphyrin compounds
As of December 31, 2013, the Company had approximately $534,000 in cash and cash equivalents and 134,550,068 common shares outstanding. The Company had accounts receivable of $1,111,000 and accounts payable of $1,395,000 on December 31, 2013. Aeolus has filed today with the SEC its Quarterly Report on Form 10-Q for the quarter ended December 31, 2013. Aeolus urges its investors to read this quarterly filing as well as its Annual Report on Form 10-K, also filed with the SEC, for further details concerning the Company. The Quarterly Report on Form 10-Q and the Annual Report on Form 10-K are also available on the Company's website, at http://www.aeoluspharma.com.
About AEOL 10150
AEOL 10150 is a broad-spectrum catalytic antioxidant specifically designed to neutralize reactive oxygen and nitrogen species. The neutralization of these species reduces oxidative stress, inflammation, and subsequent tissue damage-signaling cascades resulting from radiation exposure. AEOL 10150 may have a profound beneficial impact on people who have been exposed, or are about to be exposed, to high-doses of radiation in the treatment of oncology.
AEOL 10150 has performed well in preclinical and non-clinical studies, demonstrating statistically significant survival efficacy in an acute radiation-induced lung injury model, and was well-tolerated in two human clinical trials. The Company believes it could have a profound beneficial impact on people who have been exposed, or are about to be exposed, to high-doses of radiation, whether from cancer therapy or a nuclear event.
About Aeolus Pharmaceuticals
Aeolus Pharmaceuticals is developing a platform of a new class of broad-spectrum, catalytic-antioxidant compounds that protect healthy tissue from the damaging effects of radiation. Its first compound, AEOL 10150, is being developed, with funding by the US Department of Health and Human Services, as a medical countermeasure against chemical and radiological weapons, where its initial target indications are as a protective agent against the effects of acute radiation syndrome and delayed effects of acute radiation exposure. Aeolus' strategy is to leverage the substantial investment in toxicology, manufacturing, and preclinical and clinical studies made by US Government agencies in AEOL 10150, including the contract with BARDA valued, with options, at up to $118.4 million, to efficiently develop the compound for use in oncology. For more information, please visit Aeolus's corporate website at www.aeoluspharma.com.
Forward-Looking Statements
The statements in this press release that are not purely statements of historical fact are forward-looking statements. Such statements include, but are not limited to, those relating to Aeolus' product candidates, as well as its proprietary technologies and research programs, the Company's potential initiation of large efficacy studies in mice and NHPs, as well as a phase 1 study in healthy normal volunteers, the BARDA Contract, and the expected use of proceeds from the financing. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Aeolus' actual results to be materially different from historical results or from any results expressed or implied by such forward-looking statements. Important factors that could cause results to differ include risks associated with uncertainties of progress and timing of clinical trials, scientific research and product development activities, difficulties or delays in development, testing, obtaining regulatory approval, the need to obtain funding for pre-clinical and clinical trials and operations, the scope and validity of intellectual property protection for Aeolus' product candidates, proprietary technologies and their uses, and competition from other biopharmaceutical companies, and whether BARDA exercises one or more additional options under the BARDA Contract. Certain of these factors and others are more fully described in Aeolus' filings with the Securities and Exchange Commission, including, but not limited to, Aeolus' Annual Report on Form 10-K for the year ended September 30, 2013. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.
AEOLUS PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except per share data)
December 31, September 30,
2013 2013
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 534 $ 869
Accounts receivable 1,111 370
Deferred subcontractor cost 1,043 656
Prepaids and other current assets 38 39
------------- -------------
Total current assets 2,726 1,935
Investment in CPEC LLC 32 32
------------- -------------
Total assets $ 2,758 $ 1,966
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 1,395 $ 579
Deferred revenue 1,085 682
------------- -------------
Total current liabilities 2,480 1,261
Total liabilities 2,480 1,261
------------- -------------
Commitments and contingencies (Note F)
Stockholders' equity:
Preferred stock, $.01 par value per share,
10,000,000 shares authorized:
Series A nonredeemable convertible preferred
stock, 1,250,000 shares authorized as of
December 31, 2013 and September 30, 2013,
respectively; no shares issued and
outstanding as of December 31, 2013 and
September 30, 2013, respectively -- --
Series B nonredeemable convertible preferred
stock, 1,600,000 shares authorized as of
December 31, 2013 and September 30, 2013,
respectively; 526,080 shares issued and
outstanding as of December 31, 2013 and
September 30, 2013, respectively 5 5
Common stock, $.01 par value per share,
200,000,000 shares authorized; 134,550,068
shares issued and outstanding as of
December 31, 2013 and September 30, 2013,
respectively 1,346 1,346
Additional paid-in capital 183,544 183,276
Accumulated deficit (184,617) (183,922)
------------- -------------
Total stockholders' equity 278 705
------------- -------------
Total liabilities and stockholders' equity $ 2,758 $ 1,966
============= =============
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
AEOLUS PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Ended
December 31,
--------------------------
2013 2012
------------ ------------
Revenue:
Contract revenue $ 793 $ 1,342
Costs and expenses:
Research and development 707 1,169
General and administrative 781 655
------------ ------------
Total costs and expenses 1,488 1,824
------------ ------------
Loss from operations (695) (482)
Non-cash financing charges and change in fair
value of warrants -- 4,510
------------ ------------
Net (loss) income $ (695) $ 4,028
============ ============
Net (loss) income per weighted share
attributable to common stockholders:
Basic $ (695) $ 2,049
------------ ------------
Diluted $ (695) $ (200)
============ ============
Basic net (loss) income per common share $ (0.01) $ 0.03
------------ ------------
Diluted net (loss) income per common share $ (0.01) $ 0.00
============ ============
Weighted average common shares outstanding:
Basic 134,550 62,732
------------ ------------
Diluted 134,550 65,635
============ ============
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
AEOLUS PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
Three Months Ended
December 31,
--------------------------
2013 2012
------------ ------------
Cash flows from operating activities:
Net (loss) income $ (695) $ 4,028
Adjustments to reconcile net (loss) income to
net cash used in operating activities:
Stock-based compensation 268 72
Change in fair value of warrants -- (4,510)
Change in assets and liabilities:
Accounts receivable (741) (668)
Deferred subcontractor cost (387) --
Prepaid and other assets 1 7
Accounts payable and accrued expenses 816 792
Deferred revenue 403 --
------------ ------------
Net cash used in operating activities (335) (279)
------------ ------------
Net decrease in cash and cash equivalents (335) (279)
Cash and cash equivalents at beginning of period 869 281
------------ ------------
Cash and cash equivalents at end of period $ 534 $ 2
============ ============
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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Contact:
John McManus
President and Chief Executive Officer
Aeolus Pharmaceuticals, Inc.
1-(949) 481-9825
