On July 28, 2021 IMMUNOPRECISE ANTIBODIES LTD. (the "Company" or "IPA") (NASDAQ: IPA) (TSX VENTURE: IPA) a leader in full-service, therapeutic antibody discovery and development, reported financial results for the full fiscal year 2021 ended April 30, 2021 (Press release, ImmunoPrecise Antibodies, JUL 28, 2021, View Source [SID1234585289]).
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Fiscal 2021 Financial Summary*
Earned revenues of $17.9 million, a 27% increase which includes a sale through Talem of an internally generated therapeutic antibody for $1.2 million, core CRO business up 19%
Research and development costs increased to $2.0 million from $446,280 in 2020 due to the extensive research work the Company is undertaking, including COVID-19 related research projects
The Company recorded a net loss of $7.3 million during the year ended April 30, 2021, compared to $5.0 million in 2020
Adjusted EBITDA** of $2.3 million as compared to $52,000 in 2020
As of April 30, 2021, the Company held cash of $41.8 million
*Expressed in Canadian dollars unless otherwise noted.
**For additional information regarding Adjusted EBITDA (a non-IFRS measure) see the Forward Looking Information section below.
Dr. Jennifer Bath, CEO of ImmunoPrecise, stated, "We are pleased with our solid fiscal year end results, with consistently strong and growing recurring revenue. Looking ahead, we will continue to transform IPA, both strategically and operationally. We continue to execute on strategy including ongoing technology innovation and accelerated discovery of internal and partnered novel antibodies. We also continue to work towards becoming a leading CRO of choice and industry consolidator in the antibody discovery and development markets. As it stands, we have partnered with over 500 clients resulting in very strong recurring revenues following client onboarding for services."
"As we begin the new fiscal year, we actively seek expansion of our global footprint and push to broaden our diverse portfolio of technologies, while moving pipeline programs further toward functional and pre-clinical development. While in vitro non-clinical evaluation of four programs is currently ongoing, an additional set of five programs in development by Talem Therapeutics are at the stage of final in vitro (functional) characterization and are anticipated to enter in vivo proof of concept studies later this year. Each of these advanced assets are wholly owned by ImmunoPrecise and we look forward to completing functional and in vivo analyses with the aim of maximizing their value prior to any potential out-licensing events," concluded Dr. Bath.
Recent and Fiscal 2021 Operational Highlights
Successfully demonstrated pre-clinical in vivo results for TATX-03 PolyTope Therapy, a multi-membered monoclonal antibody cocktail designed to retain efficacy against SARS-CoV-2 variants. Results demonstrated strong efficacy for prophylactic and therapeutic use in a well-established SARS-CoV-2 animal model
Pre-released publication in Biorxiv outlining IPA’s approach to the design and development of TATX-03, also demonstrating potent pseudovirus neutralizing activity against the SARS-CoV-2 Delta (B.1.617.2) variant
New co-marketing partnership wherein Eurofins Discovery and ImmunoPrecise co-market non-overlapping service offerings to Eurofins’ global clients, providing greater access to IPA’s end-to-end antibody discovery capabilities
Presented data on TATX-21, investigational antibodies aimed to prevent low density lipid (LDL) uptake with the goal of preventing and treating Atherosclerosis Cardiovascular Disease (ACVD)
Added Dr. Ilse Roodink to the role of Chief Scientific Officer and Dr. Dion Neame to Strategic Advisory Board
Identified a unique antibody with in vivo efficacy in animal model, utilizing an alternative mechanism of action, and which binds all tested SARS-CoV-2 variants of concern
Successfully launched TATX-112 candidate antibody program, for the treatment of cancer and Alzheimer’s disease
Established separate development partnerships with Genmab and LiteVax
Announced the comprehensive screening of twenty-seven proprietary therapeutic antibodies against SARS-CoV-2, identifying antibodies that retained binding to emerging variants of concern including U.K. (B1.1.7 lineage), S. African (B.1.351 lineage) and Brazilian (P.1 lineage) strains
Solidified research partnership with Mila, a world-renowned research institute dedicated to artificial intelligence (AI) development and focused on deep learning optimization for AI and machine language learning
Successfully dual listed to NASDAQ global markets stock exchange
IPA Europe significantly expanded capabilities, releasing its second-generation B cell Select
Entered separate collaborations with Twist Bioscience and Zymeworks
Financial Results
Revenue
The Company achieved revenues of $17.9 million during the year ended April 30, 2021, consisting of an increase in its core CRO business of $2.7 million (19%) and a sale through Talem of an internally generated therapeutic antibody for $1.2 million. This represents a 27% increase over 2020 revenues of $14.1 million. The continued growth trend in CRO revenue is due to increases in both volume and financial values of client contracts due to a continued focus on expanding the breadth and depth of service offerings available in-house, new client onboarding and the sustained growth of its core existing business.
Gross Profit
During the year ended April 30, 2021, gross profit was $11.5 million (64% gross profit margin) compared to gross profit of $8.0 million (57% gross profit margin) in 2020. The increase in gross profit is, in part, a result of the sale of an internally generated asset that was expensed as research and development in prior years. Excluding the internally generated asset sale gross profit margin would have been 62%.
Research & Development
Research and development increased to $2.0 million from $446,280 in 2020, due to the extensive R&D work the Company is undertaking, including COVID-19 related research projects.
Other Income (Expenses)
The Company recorded other income of $1.6 million during the year ended April 30, 2021, compared to other expense of ($739,756) in 2020. The increase is primarily related to 2020 government grant income of $1.9 million and subsidies of $844,417 related to COVID-19, a $553,836 reduction in accretion expense related to its obligations, offset by $1.1 million unrealized foreign exchange losses on cash held in US dollars.
Net Loss
The Company recorded a net loss of $7.3 million during the year ended April 30, 2021, compared to net loss of $5 million for the year ended April 30, 2020. The Company achieved higher gross profits and received grant and subsidy income while investing in research and development, and incurring higher share-based payments, salaries, and Nasdaq uplist related costs.
Non-IFRS Measures*
Adjusted EBITDA for the year ended April 30, 2021, was $2.3 million compared to $52,311 for the same period last year. Adjusted EBITDA is management’s view of operating earnings. The significant improvement in Adjusted EBITDA is primarily the result of increased gross profits and awards of government research grants and subsidies related to COVID-19 partially offset by higher research costs, salaries, and expenses related to the Nasdaq uplist.
Cash Position
As of April 30, 2021, the Company held cash of $41.8 million as compared to $2.7 million as of April 30, 2020 and had working capital of $42.8 million. The increase in cash is primarily due to the public offering of the Company’s stock and proceeds from the exercise of warrants and stock options. The Company’s internal forecast indicates the cash on hand will sustain its existing operations, support its Nasdaq and TSXV on-going listing costs and satisfy its obligations through at least fiscal year ending 2023.
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Anyone listening to the call is encouraged to read the company’s periodic reports on file with the Toronto Stock Exchange and Securities and Exchange Commission, including the discussion of risk factors and historical results of operations and financial condition in those reports.
About IPA’s PolyTope Platform.
IPA’s SARS-CoV-2 PolyTope monoclonal therapies currently in preclinical development are designed to protect against mutagenic escape with an emphasis on efficacy for every patient, variant, and strain of SARS-CoV-2. They are created with the goal of sustainable efficacy in the face of an evolving virus, combining extensively characterized, potently neutralizing, synergistic antibodies exhibiting richly diverse epitope coverage.