ContraFect Corporation Announces Third Quarter 2014 Results
YONKERS, NY--(Marketwired - Nov 14, 2014) - ContraFect Corporation (NASDAQ: CFRX) (NASDAQ: CFRXW) (NASDAQ: CFRXZ), a biotechnology company focused on the discovery and development of protein therapeutics and antibody products for life-threatening, drug-resistant infectious diseases, today announced results for the third quarter ended September 30, 2014. The Company closed its initial public offering (IPO) on August 1, 2014. For the three month period ended September 30, 2014, the Company posted a net loss of $16.4 million. Cash and cash equivalents totaled $31.3 million at the end of the quarter.
"Throughout the quarter we have continued our mission to address treatments for life-threatening, drug-resistant infections; one of the healthcare community's major unmet needs," said Julia P. Gregory, chief executive officer of ContraFect. "We have continued to advance the development of our lead program, CF-301, which is a potential first-in-class molecule to address serious, life-threatening infections in the hospital, including those caused by the drug-resistant MRSA superbug. We plan to resubmit our IND for CF-301 by the end of the year. Our CF-404 program, which is a universal treatment for life-threatening influenza, has also made great strides and we are currently preparing to conduct IND enabling studies with that compound."
- In August 2014, ContraFect completed a successful initial public offering, raising $41.3 million. The Company's common stock is trading under the symbol "CFRX" and the two publicly traded warrants originally part of the unit offering are traded under the symbols "CFRXW" and "CFRXZ."
- ContraFect was invited to give an oral presentation of our data on CF-301 on September 9, 2014 at the 54th Interscience Conference on Antimicrobial Agents and Chemotherapy (ICAAC). The presentation, titled, "Efficacy of Single-Dose Lysin CF-301 in Combination with Vancomycin (VAN) or Daptomycin (DAP) in Experimental Endocarditis (IE) Due to Methicillin-Resistant Staphylococcus aureus (MRSA)," was presented by Michael Wittekind, Ph.D., chief scientific officer of ContraFect. The data supported ContraFect's new alternative approach to treating Staph bacteremia, demonstrating the powerful combination of CF-301 and standard-of-care antibiotics in a well-established model of infectious endocarditis.
- In September 2014, ContraFect announced that CF-404, its universal influenza treatment, received a $3.3 million, 3.5 year Advanced Technology Fast Track Small Business Innovation Research (SBIR) grant from the National Institute of Allergy and Infectious Diseases (NIAID) to fund its pre-clinical development.
- Shortly after the end of the quarter, ContraFect entered into a collaborative research agreement with the National Institute for Viral Disease Control and Prevention, China CDC ("IVDC") to advance research and development of CF-404, its universal influenza treatment.
Operating expenses for the quarter ended September 30, 2014 were $4.6 million, with $2.4 million attributable to research and development. This compares to operating expenses of $3.6 million and research and development expenses of $2.1 million for the same period in 2013. The Company incurred a net loss for the quarter ended September 30, 2014 of $16.4 million compared to a net loss of $4.4 million in the prior year period.
For the nine month period ended September 30, 2014, operating expenses were $12.1 million, with $6.5 million attributable to research and development. This compares to operating expenses of $11.9 million and research and development expenses of $6.6 million for the same period in 2013. The Company incurred a net loss for the nine months ended September 30, 2014 of $25.4 million compared to a net loss of $12.7 million in the prior year period.
The conversion of all of the Company's notes into common stock on the closing of the IPO resulted in substantially all of the $11.8 million non-cash total other expenses in the quarter which increased our net loss for both the three and nine month periods ended September 30, 2014. Our operating expenses and continued investment in research and development demonstrate how we are deploying our resources. These non-recurring, non-cash charges are not indicative of future costs.
We expect that we will conclude the year with cash of approximately $23-$25 million and full year operating expenses of approximately $18-$19 million.
ContraFect is a biotechnology company focused on discovering and developing therapeutic protein and antibody products for life-threatening, drug-resistant infectious diseases, particularly those treated in hospital settings. Due to drug-resistant and newly emerging pathogens, hospital acquired infections are currently the fourth leading cause of death in the United States, following heart disease, cancer and stroke. We intend to address drug-resistant infections using our therapeutic product candidates from our lysin and monoclonal antibody platforms to target conserved regions of either bacteria or viruses (regions that are not prone to mutation). ContraFect's initial product candidates include new agents to treat antibiotic-resistant infections such as MRSA (drug-resistant staphylococcus bacteria) and influenza.
This press release contains "forward-looking statements" within the meaning of the U.S. federal securities laws. Forward-looking statements can be identified by words such as "projects," "may," "will," "could," "would," "should," "believes," "expects," "anticipates," "estimates," "intends," "plans," "potential" or similar references to future periods. Forward-looking statements are statements that are not historical facts, nor assurances of future performance. Instead, they are based on ContraFect's current beliefs, expectations and assumptions regarding the future of its business, future plans, strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent risks, uncertainties and changes in circumstances that are difficult to predict and many of which are beyond ContraFect's control, including those detailed in ContraFect's filings with the Securities and Exchange Commission. Specific forward-looking statements in this release include statements regarding our expected timetable for submitting our IND for CF-301, our expectations regarding our full year operating expenses and expected cash balance at the end of the year. Actual results may differ from those set forth in the forward-looking statements. Any forward-looking statement made by ContraFect in this press release is based only on information currently available and speaks only as of the date on which it is made. Except as required by applicable law, ContraFect expressly disclaims any obligations to publicly update any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
(Tables to Follow)
|Condensed Balance Sheets|
|Cash and cash equivalents||$||31,320,237||$||4,145,270|
|Prepaid expenses and other current assets||417,143||198,410|
|Total current assets||31,737,380||4,343,680|
|Liabilities and stockholders' deficit|
|Convertible notes payable and other long-term liabilities||403,696||15,585,162|
|Total stockholders' equity (deficit)||29,508,926||(52,910,500||)|
|Total liabilities, convertible preferred stock, and stockholders' equity (deficit)||$||34,201,485||$||9,683,835|
|Unaudited Statements of Operations|
|Three Months Ended September 30,||Nine Months Ended September 30,|
|Research and development||$||2,363,957||$||2,108,397||$||6,545,496||$||6,601,105|
|General and administrative||2,274,569||1,465,708||5,561,432||5,249,485|
|Total operating expenses||4,638,526||3,574,105||12,106,928||11,859,590|
|Loss from operations||(4,638,526||)||(3,574,105||)||(12,106,928||)||(11,859,590||)|
|Other income (expense)|
|Interest expense, net||(11,067,209||)||(784,075||)||(12,414,240||)||(838,776||)|
|Refundable state tax credits||--||--||424,649||--|
|Change in fair value of warrant and embedded derivative liabilities||(691,943||)||--||(1,315,894||)||--|
|Total other income (expense)||(11,759,152||)||(784,075||)||(13,305,485||)||(838,776||)|
|Preferred stock dividend in-kind||--||--||(4,468,452||)||--|
|Net loss attributable to common stockholders||$||(16,397,678||)||$||(4,358,180||)||$||(29,880,865||)||$||(12,689,366||)|
|Per share information:|
|Net loss per share of common stock, basic and diluted*||$||(1.22||)||$||(4.31||)||$||(5.76||)||$||(12.54||)|
|Basic and diluted weighted average shares outstanding*||13,403,595||1,011,997||5,187,920||1,011,670|
|*Basic and diluted net loss per share attributable to common stockholders and weighted average shares outstanding were impacted by the conversion of all the Company's outstanding convertible preferred stock and convertible notes payable on the closing of the Company's initial public offering on August 1, 2014.|