On December 11, 2015 CEL-SCI Corporation (NYSE MKT: CVM) ("CEL SCI" or the "Company") reported financial results today for the fiscal year ended September 30, 2015 (Press release, Cel-Sci, DEC 11, 2015, View Source [SID:1234508549]). The Company also reported key clinical and corporate developments achieved during and subsequent to fiscal 2015.
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Clinical and Corporate Developments Included:
CEL-SCI raised net proceeds of approximately $21.15 million during fiscal 2015 and an additional $10.6 million subsequent to the end of the fiscal year, to finance its expanding Phase 3 trial in the treatment of head and neck cancer.
During fiscal year 2015 we added 7 countries to our Phase 3 study and we enrolled another 304 patients in the study. This represented a 115% increase in enrollment over fiscal year 2014. We are continuing this trend in the first quarter fiscal 2016.
We had 2 very important corporate developments that suggest our Phase 3 trial is going well and that we have a strong case in our $50+ million arbitration against the former Clinical Research Organization ("CRO"):
In October 2015 Ergomed, the new CRO running our Phase 3 trial, added another $2 million to its existing $10 million investment in our Phase 3 clinical trial, for a total investment of $12 million. Ergomed will receive its funds back only from a successful drug.
Also in October 2015, we signed a funding agreement with Lake Whillans, a firm that specializes in litigation funding. Pursuant to the agreement, CEL-SCI will receive up to $5.0 million in funding for litigation expenses to support arbitration claims against the former CRO. This case is scheduled for "hearing" (trial) in the spring of 2016. Lake Whillans will get its funds back only from the proceeds derived from the arbitration. CEL-SCI now spends $0 on this arbitration.
CEL-SCI expanded the ongoing Phase 1 study with Multikine in HIV/HPV co-infected men and women by adding a another clinical site and a world renowned key opinion leader in the field. Dr. Joel Palefsky of the University of California, San Francisco (UCSF) joined the study in July 2015 as a Principal Investigator. The study is also being conducted under a Cooperative Research and Development Agreement (CRADA) with the U.S. Navy at the San Diego Naval Medical Center.
CEL-SCI reported an operating loss of ($34.30) million in fiscal year 2015 versus an operating loss of ($27.57) million in fiscal year 2014. Of the 2015 fiscal operating loss, the cash used by the company totaled $23.8 million. The legal expenses for the arbitration were $3.6 million and those expenses will not be repeated in 2016 since the company signed an agreement with the litigation funding firm Lake Whillans to fund any remaining arbitration legal fees. This will allow CEL-SCI to focus its expenditures on the Phase 3 trial.
CEL-SCI’s net loss available to common shareholders for the quarter ended June 30, 2015 was ($4,429,137) or ($0.05) per basic share, versus ($2,444,480) or ($0.04) per basic share during the quarter ended June 30, 2014. The net loss available to common shareholders for the nine months ended June 30, 2015 was ($24,830,691) or ($0.32) per basic share, versus ($21,261,925) or ($0.38) per basic share during the same nine months ended June 30, 2014. The increase in net loss for the three and nine month periods of 2015 as compared to the same periods in 2014 was primarily attributable to the increase in operating loss and the non-cash charge for the loss on a debt extinguishment off-set by the gain reported of the non-cash charge for the change in value of derivative instruments caused by a decrease in the Company’s common stock.
The rise in operating loss was largely attributable to an increase in research and development expenses to $20.95 million in fiscal year 2015 compared to $17.0 million in fiscal year 2014. This expense increased based on the additional activity level of the Phase 3 clinical trial, including more clinical centers joining the study and more patients enrolled.
Geert Kersten, CEL-SCI’s Chief Executive Officer said, "We are rapidly enrolling patients in our Phase 3 trial in head and neck cancer and the trial date for our arbitration is near. Both of these efforts are proceeding well, and we look forward to a positive 2016."
About Multikine
Multikine* (Leukocyte Interleukin, Injection) is an investigational immunotherapeutic agent that is being tested in an open-label, randomized, controlled, global pivotal Phase 3 clinical trial as a potential first-line treatment for advanced primary squamous cell carcinoma of the head and neck. Multikine is designed to be a different type of therapy in the fight against cancer: one that appears to have the potential to work with the body’s natural immune system in the fight against tumors.