Basilea reports 2012 financials with a solid cash position and significant milestones ahead

Thu Feb 7, 2013 1:47am EST

* Reuters is not responsible for the content in this press release.

  BASEL, SWITZERLAND, Feb 07 (Marketwire) -- 
 Basilea Pharmaceutica AG / Basilea reports 2012 financials with a solid
cash position and significant milestones ahead . Processed and
transmitted by Thomson Reuters ONE. The issuer is solely responsible for
the content of this announcement.

    * CFO Joachim Blatter to depart company, CEO Ronald Scott to serve as
interim CFO

    * Cash position and short-term investments increased to CHF 344.0 million

    * Target patient recruitment reached in two isavuconazole phase 3 studies
with data expected in H2 2013

    * European regulatory review of ceftobiprole in pneumonia ongoing with
first potential approval in Q4 2013

    * Toctino(R) agreement with potential U.S. filing by Stiefel early 2014

    Basilea Pharmaceutica Ltd. (SIX: BSLN) presented today full-year
financial results for 2012 with an increased year-end cash position of
CHF 344.0 million and a reduced net loss of CHF 53.0 million. CFO Joachim
Blatter will be leaving the company to pursue other opportunities. Ronald
Scott, CEO will serve as interim CFO effective February 7, 2013.

    2012 was a transformational year. Basilea took the strategic decision to
focus its activities on anti-infective and oncology drugs and entered
into an agreement for its dermatology drug Toctino(R) (alitretinoin) with
Stiefel, a GSK company, for a CHF 224.1 million initial payment and
additional potential payments related to the commercialization of
Toctino(R) in the U.S. Stiefel has assumed responsibility for the
development, manufacturing and commercialization of Toctino(R). Basilea
is eligible for a further milestone payment related to the launch of
alitretinoin in the U.S. and will participate in future U.S. product
sales. Toctino(R) 2012 sales through completion of the Stiefel agreement
were CHF 20.2 million, in line with the company's guidance.

    In 2012, Basilea advanced the isavuconazole phase 3 program in
collaboration with Astellas and filed a ceftobiprole Marketing
Authorization Application submission for severe pneumonia in Europe. In
addition, Basilea completed its U.S. phase 3 study for alitretinoin.

    The isavuconazole SECURE phase 3 registration study, evaluating safety and
efficacy of once-daily isavuconazole versus twice-daily voriconazole for
the primary treatment of life-threatening invasive fungal disease caused
by Aspergillus species completed patient recruitment. In addition,
enrollment into the isavuconazole VITAL study, an open-label phase 3
study in the treatment of aspergillosis patients with pre-existing renal
impairment or with invasive fungal disease caused by rare but often fatal
molds, has achieved its initially targeted recruitment of patients.
Enrollment will continue to further expand the database on the use of
isavuconazole in the primary treatment of diverse rare mold infections.
Topline data from these two isavuconazole phase 3 studies are expected in
the second half of 2013 and could result in a first potential filing in
the first quarter of 2014. Under the agreement with Astellas, Basilea is
eligible for milestone payments related to filing, approval and sales, and
double-digit royalty payments. Furthermore, Basilea retains co-promotion
rights on the drug and will evaluate these rights as the drug comes
closer to the market. The isavuconazole ACTIVE phase 3 study, evaluating
the use of isavuconazole i.v. and oral versus caspofungin i.v. followed
by oral voriconazole for the treatment of invasive Candida infections,
will likely continue to recruit into 2014. Basilea and its partner
Astellas are reviewing potential filing strategies including a first
filing of the SECURE and VITAL studies.

    In 2012, Basilea also focused on bringing ceftobiprole to the market,
initially for patients with severe lung infections. Basilea submitted a
Marketing Authorization Application in Europe for the treatment of
pneumonia which was accepted for review in October 2012. Currently the
company focuses on answering the questions received from the European
agencies. Basilea had a consultation meeting with the FDA in 2012 and
will continue its discussions with the FDA to receive the agency's final
recommendation on the indications that could potentially be supported by
the existing data package. The FDA requested that Basilea conduct further
analyses of the existing phase 3 dataset to assist FDA in developing a
final recommendation. A follow-up consultation meeting for a discussion
of the data is envisaged in the second quarter of 2013. Basilea is
managing the ceftobiprole supply chain to support a potential regulatory
approval and launch and is engaged in discussions with potential partners.

    Basilea's commitment to address the medical challenge of resistance in the
areas of anti-infectives and oncology is also reflected in its phase 1
programs with innovative compounds from in-house research, addressing
high medical needs in these focus areas. The novel antibiotic BAL30072 is
intended for the treatment of multidrug-resistant Gram-negative bacteria
where current antibiotics often fail, and the new oncology drug BAL101553
focuses on the treatment of tumors resistant to current cancer therapies.
Basilea made substantial progress during 2012 in advancing these
compounds in clinical phase 1 development. BAL30072 moved into its next
stage of phase 1 testing and BAL101553 is anticipated to move into phase
2a studies in 2013.

    Ronald Scott, CEO stated: "We made significant achievements in 2012.
Through the Toctino transaction we improved our cash position and we will
continue to prudently invest our resources to achieve our key
value-driving events. Now we are focused on our important milestones for
2013, including the potential approval of ceftobiprole in Europe and
first anticipated isavuconazole phase 3 topline data." He added: "Basilea
is uniquely positioned through our innovative drug portfolio to address
the increasing threat posed by multi-drug resistant infections and drug
resistant cancers for which there are currently limited treatments
available. The critical need to address drug resistance is gaining
increasing awareness. Recent measures taken by several countries further
encourage the development of novel antibiotics and antifungals for the
treatment of drug-resistant life-threatening infections by providing
potential benefits that could result in shorter development and
regulatory timelines and longer market exclusivity." Related to the
departure of Joachim Blatter he said: "We want to thank Joachim for his
contributions, and wish him all the best for his new endeavors."

    Key figures

+-----------------------------------------------------+---------+---------+| (In
CHF million, except per share data)             |  2012   |  2011   |
| Product sales*                                      |  20.2   |  31.0   |
| Contract revenue                                    |  37.4   |  35.2   |
| Revenue from R&D services                           |   0.2   |   0.6   |
| Other income                                        |   0.5   |   0.2   |
| Total operating income                              |  58.3   |  66.8   |
|         Cost of sales                               |  (4.4)  |  (2.4)  |
|         Research & development expenses             | (58.9)  | (70.0)  |
|         Selling*, general & administrative expenses | (45.9)  | (51.7)  |
| Total operating expenses                            | (109.2) | (124.1) |
| Operating loss                                      | (50.8)  | (57.3)  |
| Net loss                                            | (53.0)  | (57.6)  |
| Net cash provided by/used for operating activities  |  148.2  | (82.4)  |
| Cash and short-term investments                     |  344.0  |  197.1  |
| Basic and diluted loss per share, in CHF            | (5.53)  | (6.01)  |

Notes: Consolidated figures in conformity with US GAAP; rounding was
consistently applied.

    *2012 numbers: Through July.

    The consolidated financial statements of Basilea Pharmaceutica Ltd. for
2012 can be found on the company's website at

    Financial summary

    Product sales in 2012 for Toctino(R) were within guidance amounting to
CHF 20.2 million, through July 2012, when the Stiefel transaction closed
(full-year 2011: CHF 31.0 million).

    Contract revenue in 2012 amounted to CHF 37.4 million (2011: CHF 35.2
million), including CHF 16.1 million related to the agreement with
Stiefel on Toctino(R), CHF 12.8 million related to Toctino(R)
distribution agreements and CHF 8.2 million related to the license
agreement with Astellas for isavuconazole. Total operating income
decreased to CHF 58.3 million in 2012 (2011: CHF 66.8 million) primarily
due to the shorter product sales period as a result of the agreement with
Stiefel on Toctino(R) in July 2012.

    Research and development expenses amounted to CHF 58.9 million in 2012,
compared to CHF 70.0 million in 2011. This decrease is mainly due to the
completion of the alitretinoin phase 3 U.S. study in the first half of
2012 and Basilea fulfilling its financial participation commitment in the
development of isavuconazole under the license agreement with Astellas.
Selling, general and administrative expenses decreased to CHF 45.9
million in 2012 (2011: CHF 51.7 million) primarily due to closing
Basilea's commercial organizations following its Toctino(R) agreement
with Stiefel in the second half of 2012.

    In 2012, the operating loss decreased to CHF 50.8 million from CHF 57.3
million in 2011, mainly due to lower research and development costs as
well as lower selling, general and administrative expenses. As a result
of this, the average monthly operating loss for 2012 was CHF 4.2 million.
The net loss 2012 amounted to CHF 53.0 million, compared to CHF 57.6
million in 2011.

    2012 basic and diluted loss per share amounted to CHF 5.53 compared to
basic and diluted loss per share of CHF 6.01 in 2011.

    In 2012, the net cash provided by operating activities was CHF 148.2
million as compared to net cash used by operating activities of CHF 82.4
million in 2011, mainly due to the upfront payment of CHF 224.1 million
received from Stiefel for the Toctino(R) agreement. Combined cash and
short-term investments increased to CHF 344.0 million as of December 31,
2012, compared to CHF 197.1 million at year-end 2011.

    Financial outlook

    Total operating expenses for 2013 are estimated to decrease to around CHF
7  to 8 million per month primarily due to the Toctino(R) transaction and
Basilea having fulfilled in 2012 its financial participation commitment
related to the development of isavuconazole. Basilea's average operating
loss in 2013 is estimated at around CHF 4 to 5 million per month.


    Isavuconazole - a novel intravenous and oral broad-spectrum antifungal,
partnered with Astellas Pharma Inc., for the potential treatment of severe
invasive and life-threatening fungal infections

    Isavuconazole demonstrated excellent in-vitro and in-vivo coverage of a
broad range of yeasts (such as Candida species) and molds (such as
Aspergillus species) as well as in-vitro activity against less prevalent
but often fatal molds such as Mucorales spp. It has U.S. FDA fast-track
status. In clinical studies to date it achieved predictable drug levels
and high oral bioavailability suggesting the potential for predictable
dosing and a switch from i.v. administration to convenient once-daily
oral dosing.

    Ceftobiprole - a novel broad-spectrum antibiotic for the potential
first-line empiric treatment of severe multidrug-resistant bacterial

    Ceftobiprole has unique broad-spectrum activity against Gram-positive
bacteria, including methicillin-resistant and vancomycin-resistant
Staphylococcus aureus (MRSA, VRSA) and penicillin-resistant Streptococcus
pneumoniae (PRSP) as well as Gram-negative pathogens, including
Enterobacteriaceae and Pseudomonas aeruginosa. Ceftobiprole has met the
study endpoints in several phase III studies and has shown a typical
cephalosporin safety profile.

    BAL30072 - a novel innovative sulfactam antibiotic with bactericidal
activity against multidrug-resistant Gram-negative bacteria

    The investigational drug has demonstrated broad in-vitro and in-vivo
coverage of Gram-negative pathogens including multidrug-resistant
Pseudomonas aeruginosa and Acinetobacter baumannii. It has robust
activity against common strains of bacteria that produce
antibiotic-inactivating enzymes including extended-spectrum
beta-lactamases (ESBL) and metallo-beta-lactamases such as the New Delhi
metallo-beta-lactamase 1 (NDM-1). In addition, BAL30072 has been shown to
enhance the activity of antibiotics from the penem class.

    BAL101553 - a novel small-molecule anti-cancer drug with a dual mode of
action directly attacking tumor cells as well as disrupting tumor blood

    BAL101553 disrupts the intracellular microtubule network that is essential
for cell division and has shown potent activity in many tumor cell lines
that are insensitive or resistant to taxanes or other
microtubule-targeting agents. In contrast to currently available
microtubule-targeting agents that are derived from complex natural
products, BAL101553 is a simpler synthetic molecule that bypasses some of
the resistance mechanisms associated with existing drugs. BAL101553 was
developed as a highly water-soluble prodrug of Basilea's BAL27862 with
anticipated good oral bioavailability and an injectable formulation
without potentially harmful solubilizers.

    Toctino(R) (oral alitretinoin) - the only licensed drug for systemic use
in adults with severe chronic hand eczema unresponsive to potent topical

    Toctino(R) was developed and successfully brought to market by Basilea.
In the U.S., oral alitretinoin is an investigational drug in phase III
and not yet approved by the FDA. In July 2012, Basilea completed an
agreement for Toctino(R) with Stiefel, a GSK company.

    Conference call

    Basilea Pharmaceutica Ltd. invites you to participate in a conference call
on Thursday, February 7, 2013, 4 p.m. (CET), during which the company will
discuss today's press release.

    Dial-in numbers are:

  +41 (0) 91 610 56 00       (Europe and ROW)

  +1 (1) 866 291 4166        (USA)

  +44 (0) 203 059 5862       (UK)

A playback will be available 1 hour after the conference call until
Monday, February 11, 2013, 6 p.m. (CET). Participants requesting a
digital playback

  +41 (0) 91 612 4330         (Europe and ROW)

  +1 (1) 866 416 2558         (USA)

  +44 (0) 207 108 6233        (UK)

and will be asked to enter the ID 18060 followed by the # sign.

    Note to shareholders

    The shareholders of Basilea Pharmaceutica Ltd. are informed that the
Ordinary General Meeting of Shareholders of Basilea Pharmaceutica Ltd.
will take place on Tuesday, April 9, 2013 at 2 p.m. at the Hilton Hotel
in Basel, Switzerland. The invitation will be published in the Swiss
Official Gazette of Commerce (Schweizerisches Handelsamtsblatt, SHAB).
Shareholders who are recorded in the share register with voting rights on
March 28, 2013 will be entitled to participate and exercise their voting

    About Basilea

    Basilea Pharmaceutica Ltd. is headquartered in Basel, Switzerland, and
listed on the SIX Swiss Exchange (SIX: BSLN). Through the fully
integrated research and development operations of its Swiss subsidiary
Basilea Pharmaceutica International Ltd., the company focuses on
innovative pharmaceutical products in the therapeutic areas of bacterial
infections, fungal infections and oncology, targeting the medical
challenge of rising resistance and non-response to current treatment


    This communication expressly or implicitly contains certain
forward-looking statements concerning Basilea Pharmaceutica Ltd. and its
business. Such statements involve certain known and unknown risks,
uncertainties and other factors, which could cause the actual results,
financial condition, performance or achievements of Basilea Pharmaceutica
Ltd. to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements.
Basilea Pharmaceutica Ltd. is providing this communication as of this
date and does not undertake to update any forward-looking statements
contained herein as a result of new information, future events or

    This press release can be downloaded from

    Press Release (PDF):

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Reuters clients. The owner of this announcement warrants that:

    (i) the releases contained herein are protected by copyright and  other
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    (ii) they are solely responsible for the content, accuracy and 
originality of the information contained therein.

    Source: Basilea Pharmaceutica AG via Thomson Reuters ONE


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