Spring Bank Pharmaceuticals Provides Corporate Update and Reports Second Quarter 2017 Financial and Operational Results

Reports multiple recent developments and milestones

Plans to report top-line results from the second monotherapy dosing cohort of the ACHIEVE global Phase 2 clinical trial of SB 9200 in chronic HBV in 4Q 2017

Successful $40 million equity financing expected to fund company through end of 2019

HOPKINTON, Mass., July 31, 2017 (GLOBE NEWSWIRE) -- Spring Bank Pharmaceuticals, Inc. (Nasdaq:SBPH), a clinical-stage biopharmaceutical company developing novel therapeutics for the treatment of viral infections, inflammatory diseases and certain cancers, today announced second quarter 2017 financial results and provided an update on recent corporate and clinical developments.

“We are pleased with the progress we accomplished in the second quarter of this year with several strategic initiatives at Spring Bank,” commented Martin Driscoll, President and Chief Executive Officer of Spring Bank Pharmaceuticals, Inc. “We disclosed positive top-line results from the first cohort of chronic HBV patients in the ongoing Phase 2a ACHIEVE trial investigating our lead development compound, SB 9200, and we have since completed patient enrollment in the second cohort of this trial. Additionally, we continued to advance our lead preclinical candidate, SB 11285, from our next-generation STING (STimulator of INTerferon Genes) agonist platform with a goal to enter clinical trials in certain cancers in the second half of 2018. Importantly, we executed on a financing in June that raised approximately $40 million in new capital allowing us to accelerate several programs and strengthening our balance sheet to the point that our company is now funded through the end of 2019. This successful financing also enhanced our shareholder base with high-quality, sophisticated institutional life sciences investors.”

Mr. Driscoll continued, “We have had a strong start to the third quarter with the recent announcement of our new clinical trial collaboration and supply agreement with Gilead for a Phase 2 trial to examine the co-administration of SB 9200 and Gilead’s Vemlidy® (tenofovir alafenamide) in chronic HBV patients. We look forward to making continued progress with multiple initiatives at our company in the second half of this year.”

Second Quarter 2017 and Recent Developments

  • Completed public offering to strengthen balance sheet. In June 2017, Spring Bank raised approximately $40 million of net proceeds through an underwritten public offering of 3,269,219 shares of our common stock at $13.00 per share. This included 384,604 shares pursuant to the exercise of an option granted to the underwriters to purchase additional shares. The net proceeds to the company represent the amount raised after deducting underwriting discounts and commissions and other offering expenses payable by the company.
  • Reported top-line results in the initial cohort of its ACHIEVE global Phase 2 clinical trial. In May 2017, Spring Bank reported top-line results from the first SB 9200 monotherapy dosing cohort of the Phase 2a clinical trial. The Phase 2a segment is a placebo-controlled, sequential-cohort, double-blind trial designed to evaluate increasing doses of SB 9200 (25mg, 50mg, 100mg and 200mg) as monotherapy for 12 weeks followed by tenofovir disoproxil fumarate 300 mg (marketed by Gilead Sciences, Inc. as Viread®) for an additional 12 weeks. The top-line results indicated that a low dose (25mg) of SB 9200 alone showed a favorable safety profile and antiviral activity against HBV DNA and HBsAg. Administration of SB 9200 resulted in a statistically significant reduction in HBV DNA at week 12 (unpaired t-test 2.85, p=0.01) compared to placebo, with a mean reduction of 0.6 log10 (range 0 to 1.87 log10) in the SB 9200 treatment group. The overall safety profile of SB 9200 was favorable with no serious adverse events observed during the 12-week study. Treatment-emergent adverse events ranged from mild to moderate in severity with no interferon-like side effects and were comparable to patients on placebo.
  • Completed patient enrollment in second cohort of its ACHIEVE global Phase 2 clinical trial. In July 2017, Spring Bank completed patient screening and enrollment of all twenty patients in the second cohort of the Phase 2a segment of the ACHIEVE global Phase 2 clinical trial of SB 9200 in chronic HBV patients. The company remains on track to report top-line results from the second dosing cohort in the fourth quarter of 2017.
  • Consummated a second HBV clinical collaboration with Gilead. In July 2017, the company announced that it had entered into a clinical collaboration with Gilead to conduct a Phase 2 trial examining the use of Spring Bank’s oral selective immunomodulator, SB 9200, co-administered with tenofovir alafenamide, marketed by Gilead as Vemlidy®, in patients infected with chronic HBV. Under terms of the agreement, Gilead will conduct and provide funding for the trial and Spring Bank will supply SB 9200.
  • Published abstract on SB 11285, the company’s lead STING agonist candidate, at the 2017 American Society of Clinical Oncology (ASCO) Annual Meeting. In June 2017, an abstract was published at the ASCO Annual Meeting indicating that SB 11285 showed potent and highly-durable anti-tumor activity in the A20 and CT26 syngeneic mouse tumor models. The induction of immune-memory and abscopal anti-tumor activity upon intra-tumoral administration of SB 11285 was also observed in the A20 lymphoma model. In addition, Spring Bank reported that SB 11285 exhibited dose-dependent, potent tumor growth inhibition and durable anti-tumor response upon intra-tumoral, intraperitoneal and intravenous routes of administration in the CT26 colon cancer syngeneic mouse model.

Second Quarter 2017 Financial Results

  • Cash Position: Cash, cash equivalents and marketable securities were $56.4 million as of June 30, 2017, compared to cash, cash equivalents and marketable securities of $25.5 million as of December 31, 2016. Net cash used in operating activities for the six months ended June 30, 2017 was $8.8 million, compared to $8.9 million for the same period in 2016. Spring Bank anticipates that its existing cash, cash equivalents and marketable securities will enable it to fund its operating expenses and capital expenditure requirements through the end of 2019. However, the company anticipates that its existing cash, cash equivalents and marketable securities will not be sufficient to fund additional development of SB 9200 beyond the company’s Phase 2 ACHIEVE clinical trial.
  • Operating Expenses: Total operating expenses for the three months ended June 30, 2017 were $5.3 million, which consisted of $3.4 million of research and development (R&D) expenses and $1.9 million of general and administrative (G&A) expenses. Total operating expenses for the three months ended June 30, 2016 were $4.4 million, which consisted of $2.9 million of R&D expenses and $1.5 million of G&A expenses.
  • Net loss: The company’s net loss for the three months ended June 30, 2017 was $8.9 million, or $0.93 per share, compared to $4.3 million for the three months ended June 30, 2016, or $0.62 per share.

About Spring Bank Pharmaceuticals

Spring Bank Pharmaceuticals is a clinical-stage biopharmaceutical company engaged in the discovery and development of a novel class of therapeutics using its proprietary small molecule nucleic acid hybrid (SMNH) chemistry platform. SMNH compounds are small segments of nucleic acids that the company designs to selectively target and modulate the activity of specific proteins implicated in various disease states. The company is developing its most advanced SMNH product candidate, SB 9200, for the treatment of viral diseases, including hepatitis B virus (HBV) and other SMNH product candidates, including SB 11285, the company's lead immunotherapeutic agent for the treatment of selected cancers through the activation of the STimulator of Interferon Genes, or STING, pathway. For more information, please visit www.springbankpharm.com.

Forward-Looking Statements

Statements in this press release about Spring Bank's future expectations, plans and prospects, as well as any other statements regarding matters that are not historical facts, may constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements about (i) the company having sufficient funds to enable it to fund its operating expenses and capital expenditure requirements through the end of 2019, (ii) the company’s anticipated timeline for disclosing top-line results from the second SB 9200 monotherapy dosing cohort in the Phase 2a trial of SB 9200, and (iii) the anticipated timeline for conducting clinical trials for SB 11285.

Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including whether Spring Bank’s cash resources will be sufficient to fund its continuing operations for the periods and/or trials anticipated; whether results obtained in preclinical studies and clinical trials will be indicative of results obtained in future clinical trials; whether Spring Bank’s product candidates will advance through the clinical trial process on a timely basis, or at all; whether the results of such trials will warrant submission for approval from the United States Food and Drug Administration or equivalent foreign regulatory agencies; whether Spring Bank's product candidates will receive approval from regulatory agencies on a timely basis or at all; whether, if product candidates obtain approval, they will be successfully distributed and marketed; and other factors discussed in the "Risk Factors" section of Spring Bank's Annual Report on Form 10-K for the year ended December 31, 2016, which was filed with the Securities and Exchange Commission (SEC) on February 14, 2017, Spring Bank's Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, which was filed with the SEC on July 31, 2017, and in other filings Spring Bank makes with the SEC from time to time.

In addition, the forward-looking statements included in this press release represent Spring Bank’s views as of the date hereof. Spring Bank anticipates that subsequent events and developments will cause Spring Bank’s views to change. However, while Spring Bank may elect to update these forward-looking statements at some point in the future, Spring Bank specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing Spring Bank’s views as of any date subsequent to the date hereof.

Spring Bank Pharmaceuticals, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
June 30, December 31,
2017 2016
Cash and cash equivalents $51,443 $10,684
Short and long-term marketable securities 4,936 14,798
Other assets 1,469 1,397
Total assets $57,848 $26,879
Warrant liabilities $12,027 $6,333
Other liabilities 3,577 3,528
Total liabilities 15,604 9,861
Total stockholders’ equity 42,244 17,018
Total liabilities and stockholders' equity $57,848 $26,879

Consolidated Statements of Operations and Comprehensive Loss
(in thousands, except share and per share data)
For the Three Months Ended
June 30,
For the Six Months Ended
June 30,
2017 2016 2017 2016
Grant revenue $ $72 $ $352
Operating expenses:
Research and development 3,404 2,936 5,931 8,525
General and administrative 1,856 1,458 3,843 2,684
Total operating expenses 5,260 4,394 9,774 11,209
Loss from operations (5,260) (4,322) (9,774) (10,857)
Interest income 38 21 79 38
Change in fair value of warrant liabilities (3,667) (5,694)
Net loss (8,889) (4,301) (15,389) (10,819)
Unrealized gain (loss) on marketable securities 4 3 21
Comprehensive loss $(8,889) $(4,297) $(15,386) $(10,798)
Net loss per common share – basic and diluted $(0.93) $(0.62) $(1.63) $(1.69)
Weighted-average number of common shares used in
computing net loss per share – basic and diluted
9,517,086 6,923,941 9,466,951 6,400,538

Contact: Spring Bank Pharmaceuticals, Inc. Jonathan Freve Chief Financial Officer (508) 473-5993 jfreve@springbankpharm.com

Source:Spring Bank Pharmaceuticals Inc.