InVivo Therapeutics Reports Second Quarter 2012 Financial Results, Provides Business Update
<0> InVivo Therapeutics Holdings Corp.Bob Housler, Jr., (617) 863-5520 </0>
, a developer of groundbreaking technologies for the treatment of spinal cord injuries (SCI) and other neurotrauma conditions, today reported the financial results for the three and six months ended June 30, 2012 and provided a business update.
InVivo has pioneered a new treatment that uses a biocompatible polymer-based scaffold to provide structural support to a damaged spinal cord in order to spare tissue from scarring while improving recovery and prognosis after a traumatic spinal cord injury. Today there is no effective treatment for the spinal cord for paralysis caused by SCIs, and the market potential is estimated to be over $10 billion.
“The first six months of 2012 have been a time of tremendous progress for InVivo," said Frank Reynolds, InVivo’s Chief Executive Officer. "We are advancing multiple neurotrauma products based on our biopolymer scaffolding and hydrogel technologies. Our biopolymer scaffolding device for the treatment of acute SCI is poised to gain FDA clearance to commence human clinical studies. We recently engaged with the FDA for our hydrogel/methylprednisolone combination product and expect to submit hydrogel-based applications to the FDA for the treatments of SCI and pain later this year. Also, in July we moved into our new corporate headquarters and are busy gearing up our vivarium and cGMP facilities to support the development and commercialization of these products."
The Company is making preparations to commence a pilot human clinical trial pending expected FDA approval. Based on discussions with the FDA, the Company is expecting the product to be regulated under the Humanitarian Use Device/Humanitarian Device Exemption (HUD/HDE) pathway which should accelerate commercialization. The pilot study will be an open label study and is designed to evaluate the safety and efficacy in SCI patients following treatment with the biopolymer scaffolding. This study follows promising pre-clinical studies completed in non-human primates. InVivo was the first to successfully demonstrate functional improvement in non-human primates that were paralyzed after a spinal cord injury model.
In June, InVivo filed a request to meet with the FDA's Office of Combination Products and the appropriate representatives from FDA's drug and device branches to discuss InVivo’s novel injectable hydrogel specifically engineered for the effective local release of a number of molecules including methylprednisolone. InVivo is conducting a preclinical study with Geisenger Health System to evaluate the Company’s injectable biocompatible hydrogel for the treatment of pain caused by peripheral nerve compression. Approximately 3.2 million pain injections are performed annually to treat back, neck and leg pain caused by peripheral nerve injuries, and InVivo’s hydrogel is designed to time-release anti-inflammatory drugs for extended pain relief. The product addresses an estimated $22 billion market.
In July, the Company held the inaugural Langer Summit on Neurotrauma chaired by InVivo co-founder Robert S. Langer, ScD, the David Koch Institute Professor at Massachusetts Institute of Technology. The meeting brought together some of the leading researchers in neurotrauma who shared and discussed recent innovations in the field and the opportunities for InVivo to advance its technologies into the clinic.
The Company's Chief Science Officer, Dr Edward Wirth III, MD, PhD presented preclinical data on InVivo's biopolymer scaffolding and hydrogel technologies at two key scientific conferences. In May, Dr. Wirth presented SCI data from InVivo’s non-human primate studies at Rick Hansen's Interdependence 2012 conference. In June, Dr. Wirth presented preclincal data at the Clinical Outlooks for Regenerative Medicine Conference. InVivo has published a number of studies covering its preclinical studies and the publication from InVivo's first non-human primate study won the Apple Award from the American Spinal Cord Injury Association for excellence in SCI research.
In July, InVivo moved into a 21,000 square foot facility at One Kendall Square in Cambridge, Massachusetts. The new state-of-the-art facility brings all of the Company’s operations under one roof and houses corporate offices, a vivarium, laboratory space and a cGMP clean room for manufacturing. The Company is in the process of ramping up its cGMP facility to support manufacturing of biopolymer scaffoldings for clinical trials and commercial requirements.
For the three months ended June 30, 2012, the Company reported net income of $2,201,000 or $.03 per diluted share, compared to a net loss of $1,370,000, or $.03 per diluted share, for the three months ended June 30, 2011. Included in results for the three months ended June 30, 2012 and 2011 were non-cash derivative gains of $4,954,000, and $1,163,000, respectively, reflecting decreases in the fair value of the derivative warrant liability. Exclusive of the non-cash derivative gain, the pro forma net loss for the three months ended June 30, 2012, was $2,753,000, or $.04 per diluted share, compared to a pro forma net loss of $2,533,000, or $.05 per diluted share for 2011. Total operating expenses for the three months ended June 30, 2012 were $2,755,000 compared with $2,527,000 for the three months ended June 30, 2011. The Company ended the quarter with $18,037,000 of cash and cash equivalents.
For the six months ended June 30, 2012, the Company reported net income of $5,351,000 or $.07 per diluted share, compared to a net loss of $2,648,000, or $.05 per diluted share, for the six months ended June 30, 2011. Included in results for the six months ended June 30, 2012 and 2011 were non-cash derivative gains of $10,567,000, and $1,284,000, respectively, reflecting decreases in the fair value of the derivative warrant liability. Exclusive of the non-cash derivative gain, the pro forma net loss for the six months ended June 30, 2012, was $5,217,000, or $.09 per diluted share, compared to a pro forma net loss of $3,932,000, or $.08 per diluted share for 2011. Total operating expenses for the six months ended June 30, 2012 were $5,216,000 compared with $3,928,000 for the six months ended June 30, 2011.
InVivo Therapeutics Holdings Corp. is focused on utilizing polymers as a platform technology to develop treatments to improve function in individuals paralyzed as a result of traumatic spinal cord injury. The Company was founded in 2005 on the basis of proprietary technology co-invented by Robert Langer, ScD., Professor at Massachusetts Institute of Technology, and Joseph P. Vacanti, M.D., who is affiliated with Massachusetts General Hospital. In 2011, data from a Company study was published in the Journal of Neuroscience Methods and won the prestigious 2011 Apple Award from the American Spinal Injury Association recognizing excellence in SCI research. The publicly traded company is headquartered in Cambridge, MA. For more details, visit .
(Tables to follow)
InVivo is providing pro forma results as a complement to GAAP results. The pro forma net loss and pro forma diluted loss per share excludes the derivative gain which is a non-cash item. InVivo’s management believes this pro forma measurement helps to indicate underlying trends in the Company's ongoing operations. The reconciliation between pro forma and reported income (loss) per share for the three months and six months ended June 30, 2012 and 2011 is provided in the following table: