A year of many momentous moments
GHENT, Belgium, 22 February 2018 - Ablynx [Euronext Brussels and Nasdaq: ABLX] today announced its financial results for the year ended 31st December 2017, which have been prepared in accordance with IFRS as issued by the IASB and adopted by the European Union, business highlights year-to-date and the outlook for the remainder of the year.
- Compelling Phase III data for caplacizumab (wholly-owned, anti-vWF Nanobody®) for the treatment of acquired thrombotic thrombocytopenic purpura (aTTP), a potential €1.2 billion per annum market, which will support both the ongoing regulatory review process in Europe and the planned Biologics License Application (BLA) in the USA
- Successful US initial public offering (IPO) raising $230 million
- Completed the dose escalation part of the Phase IIb RESPIRE study in 36 infants with the wholly-owned anti-RSV (respiratory syncytial virus) Nanobody, ALX-0171, and initiated the parallel dose part in 144 infants, with topline results expected in Q4 2018
- Research collaboration with Sanofi on up to eight new programmes, focussed on immune-mediated inflammatory diseases, with €23 million in upfront payments and up to €2.4 billion in potential milestones plus tiered royalties
- Received €15 million milestone payment from Merck KGaA for the completion of a pre-clinical package for ALX-1141, targeting ADAMTS-5 in osteoarthritis, which has since entered Phase I trials
- Total revenues of €55.5 million and net cash burn of €60.4 million resulting in a cash position, including cash, other financial assets, restricted cash and deposits of €354.3 million
On 29th January 2018, Ablynx announced an offer by Sanofi to acquire all its outstanding ordinary shares (including shares represented by American Depository Shares (ADSs), warrants and convertible bonds) at a price of €45 per share, which represents an aggregate equity value of approximately €3.9 billion. This proposed transaction was unanimously approved by both the Sanofi and Ablynx Board of Directors. The tender offer is expected to be launched in the beginning of the second quarter of 2018. Sanofi will publish an offer document in which it will set out the full details of its tender offer, and the Board of Directors of Ablynx will publish a response memorandum ('memorie van antwoord'), in which it will set out its position on the tender offer.
Dr Edwin Moses, CEO of Ablynx said:
"We experienced many momentous moments this year including the compelling Phase III results for our lead product caplacizumab and our successful US initial public offering. Caplacizumab has the potential to change the lives of patients affected by aTTP, a devastating disease for which there is currently no approved drug available. We are proud to be pioneers in the treatment of aTTP and are working with the regulatory authorities to obtain marketing approval and make caplacizumab rapidly available to patients."
"We are also pleased with the progress made with our anti-RSV Nanobody, ALX-0171, that is delivered via nebulisation, a technique with potential in other pulmonary diseases, and we look forward to the results from our Phase IIb RESPIRE study which should be available before the end of this year."
"The offer made by Sanofi on 29th January 2018 to acquire Ablynx for €3.9 billion represents compelling value for shareholders and builds on a successful existing partnership. We strongly believe that Sanofi's global infrastructure, commitment to innovation and commercial capabilities will accelerate Ablynx's therapeutic programmes and maximise the potential of our pipeline and unique Nanobody technology platform to the benefit of all stakeholders."
In January, Ablynx's partner, Merck KGaA, reported encouraging results from their Phase Ib study of the bi-specific anti-IL-17A/F Nanobody, in patients with moderate to severe psoriasis.
In February, Ablynx submitted a marketing authorisation application (MAA) to the European Medicines Agency (EMA) for caplacizumab, its wholly-owned anti-vWF-Nanobody, caplacizumab, for the treatment of aTTP, including data from the Phase II TITAN study. In November, the MAA was further updated with the positive results of the Phase III HERCULES study that were announced in October.
In May, Ablynx received a €15 million milestone payment from Merck KGaA for the completion of a pre-clinical package for a novel Nanobody (ALX-1141) targeting ADAMTS-5 in osteoarthritis, with Merck KGaA subsequently starting a Phase I study.
In June, Ablynx achieved a second milestone in the immuno-oncology collaboration with Merck & Co., Inc., (known as MSD outside the USA and Canada) triggering a €2.5 million payment to Ablynx.
In July, Ablynx received Fast Track designation from the FDA for caplacizumab for the treatment of aTTP.
In August, Ablynx announced the completion of the sequential dose escalation part of the Phase IIb RESPIRE study in 36 infants hospitalised as a result of a RSV infection and the initiation of the parallel dose part in 144 infants with ALX-0171, the Company's inhaled anti-RSV Nanobody. Results from this Phase IIb study are expected in Q4 2018.
In October, Ablynx announced positive topline results from the Phase III HERCULES study of caplacizumab, in 145 patients with aTTP. The study met its primary and two key secondary endpoints and reported a favourable safety profile.
In December, Ablynx reported additional clinically important benefits of caplacizumab from its Phase III HERCULES study in aTTP at the 59th Annual Meeting of the American Society of Hematology (ASH) as part of the late-breaking abstracts session.
Also in December, Ablynx announced positive data from a single and multiple dose Phase I study of caplacizumab, demonstrating comparable pharmacokinetics in 60 healthy Japanese and Caucasian subjects.
In June, Ablynx appointed Dr Markus Ewert as Chief Business Officer to lead Ablynx's business development activities and become a member of the Executive Committee.
In July, Ablynx announced a research collaboration and global exclusive licensing agreement with Sanofi to develop up to eight Nanobody product candidates initially focused on immune-mediated inflammatory diseases. Ablynx received an upfront payment of €23 million plus research funding for the initially selected targets and is eligible to receive further option exercise fees from additional targets and up to €2.4 billion in potential future milestone payments and royalties on the net sales of any products originating from the collaboration.
In October, following the positive Phase III data of caplacizumab, Ablynx completed its initial US public offering, raising $230 million in gross proceeds from the sale of 13,144,500 ordinary shares in the form of ADSs, including the full exercise of the underwriters' option, at a price of $17.50 per ADS. The US public offering was nearly three times oversubscribed and was upsized from the $175 million initially targeted.
Also in October, Ablynx established Ablynx, Inc., its subsidiary in the USA and appointed Mr Daniel Schneider as the General Manager to lead the commercialisation of caplacizumab in North America.
In January 2018, Ablynx announced the appointment of Robert Friesen, PhD, as Chief Scientific Officer, effective 1st March 2018. Dr Friesen will lead the Company's scientific, research and technology activities and become a member of the Executive Committee.
In January and February 2018, Ablynx announced changes to its Board of Directors with the departures of Dr Peter Fellner and Dr Bo Jesper Hansen respectively. Dr Russell G. Greig, who has been a non-executive Director of Ablynx since 2012, is now the new Chairman of the Board.
On 16th February 2018, Ablynx announced that as part of the research collaboration signed in July 2017, Sanofi has exercised its options for two additional multi-specific Nanobody product candidates, triggering the payment to Ablynx of €13 million in exercise fees.
On 1st March 2018, Piet Houwen will join Ablynx as Chief Operating Officer. Mr Houwen will be responsible for the support of Ablynx's business and R&D processes and become a member of the Executive Committee.
Outlook for the remainder of 2018
During H1 2018, a BLA will be submitted for caplacizumab in the USA. In Europe, the Company has the potential to receive marketing authorisation for caplacizumab in aTTP in Q3 2018 followed by potential first commercial sales in Germany.
For ALX-0171, a Phase II study in Japanese infants, hospitalised as a result of a RSV infection, and a global Phase II study in hematopoietic stem cell transplant patients who become infected with RSV, are expected to be initiated in H1 2018. Results from the ongoing Phase IIb study in RSV-infected hospitalised infants are expected in Q4 2018.
The Phase II study results for vobarilizumab (anti-IL6R Nanobody) in 312 systemic lupus erythematosus (SLE) patients are expected in H1 2018 followed by AbbVie's decision on whether to opt-in and license the compound.
The Company expects up to three Nanobodies to enter Phase I studies from our collaborative programmes during the year.
Detailed financial review
|(€ million)||FY 2017||FY 2016||Variance|
|Total revenue and grant income||55.5||85.2||(35%)|
|Net financial result||(54.3)||27.5||< (100%)|
|Net loss||(108.5)||(1.1)||< (100%)|
|Net cash burn*||(60.4) (1)||(72.2) (3)||16%|
|Cash position** at 31 December||354.3 (2)||235.4 (4)||51%|
(1) excluding €179.3 million net proceeds from Nasdaq IPO
(2) including €1.6 million in restricted cash
(3) excluding €71.4 million net proceeds from the private placement announced on 1 June 2016
(4) including €1.6 million in restricted cash
* Net cash burn is the difference between the cash position of the current year and the previous year minus the proceeds (net of issue costs) from the issue of ordinary shares
** Cash position includes cash, other financial assets, restricted cash and deposits
Total revenues and grant income decreased by 35% to €55.5 million (2016: €85.2 million), mainly driven by lower recognition of upfront payments from the ongoing collaborations with AbbVie and Merck & Co., Inc.
Total research and development costs decreased to €90.9 million (2016: €100.3 million) in line with the decrease in external development costs, largely related to lower clinical trials expenditure for vobarilizumab.
General and administrative costs increased to €18.8 million (2016: €13.5 million), related to expenditure for consultancies and staff, including pre-commercialisation costs for caplacizumab and costs related to the IPO on Nasdaq completed in October 2017.
As a result of the above, the operating loss was €54.2 million (2016: €28.6 million).
The net financial loss of €54.3 million comprises finance expenses of €46.6 million resulting from an increase in the fair value of the derivative associated with the convertible bond (following an increase in the Ablynx share price at year-end compared to that at the end of 2016), and finance costs of €7.4 million (mainly related to the amortisation of the debt component of the convertible bond).
As a result, the net loss for 2017 increased to €108.5 million (2016: net loss of €1.1 million).
The Company's non-current assets of €78.5 million are €53.9 million higher than at 31 December 2016, mainly driven by the purchase of Interest Structured Notes with a maturity of two years and higher receivables for research and development incentives.
Ablynx's current assets of €311.3 million consist mainly of cash and cash equivalents and other financial assets. Cash and cash equivalents consist of cash and deposits held on call with several banks. The Company also places cash in term accounts with maturities limited to a maximum of one year.
Shareholders' equity increased from €103.1 million at the end of 2016 to €179.9 million at the end of 2017, mainly as a result of the €179.3 million net proceeds from the IPO on Nasdaq and the incorporation of the €108.5 million loss for the period.
Non-current liabilities relate to the senior unsecured bonds due on 27 May 2020 with a principal value of €100 million.
Current liabilities consist mainly of trade payables and deferred income related to the upfront payments received from partners.
Cash flow statement
Net cash outflow from operating activities was €57.8 million as compared to a net outflow of €66.6million in 2016. The difference primarily relates to lower operating expenses for the current period.
Cash flow from investing activities resulted in a net outflow of €160.0 million as compared to a net inflow of €45.9 million in 2016. The net cash outflow primarily relates to the movements from deposits with a term of less than 1 month to deposits with a term greater than 1 month.
Cash flow from financing activities represented a net inflow of €179.5 million compared to a net inflow of €70.4 million in 2016. The difference primarily relates to higher net proceeds from the issue of new shares on Nasdaq in 2017 compared to the net proceeds raised via an accelerated book building procedure in 2016.
The Company ended the period with a total liquidity position of €354.3 million (2016: €235.4 million) which consists of cash and cash equivalents of €14.9 million, other financial assets of €337.8 million and restricted cash of €1.6 million.
Investor Conference Call and Webcast
In light of the pending transaction with Sanofi, Ablynx will not be hosting a conference call to discuss its 2017 full year results.
Next financial events
27 March 2018 - online publication Annual Report 2017
26 April 2018 - Annual General Meeting 2018
Glossary of terms
ADS American Depositary Shares
ASH American Society of Hematology
aTTP acquired thrombotic thrombocytopenic purpura
BLA biologics license application
EMA European Medicines Agency
IPO Initial Public Offering
MAA marketing authorisation application
RA rheumatoid arthritis
RSV respiratory syncytial virus
SLE systemic lupus erythematosus
Ablynx is a biopharmaceutical company engaged in the development of Nanobodies, proprietary therapeutic proteins based on single-domain antibody fragments, which combine the advantages of conventional antibody drugs with some of the features of small-molecule drugs. Ablynx is dedicated to creating new medicines which will make a real difference to society. Today, the Company has more than 45 proprietary and partnered programmes in development in various therapeutic areas including inflammation, haematology, immuno-oncology, oncology and respiratory disease. The Company has collaborations with multiple pharmaceutical companies including AbbVie; Boehringer Ingelheim; Eddingpharm; Merck & Co., Inc., Kenilworth, New Jersey, USA; Merck KGaA; Novo Nordisk; Sanofi and Taisho Pharmaceuticals. The Company is headquartered in Ghent, Belgium. More information can be found on www.ablynx.com.
For more information, please contact
Dr Edwin Moses
t: +32 (0)9 262 00 07
m: +32 (0)473 39 50 68
Director Investor Relations
t: +32 (0)9 262 01 37
m: +32 (0)498 05 35 79
Follow us on Twitter @AblynxABLX
Ablynx media relations:
Consilium Strategic Communications
Mary-Jane Elliott, Philippa Gardner, Sukaina Virji
t: +44 (0)20 3709 5700
Joele Frank, Wilkinson Brimmer Katcher
Dan Katcher or Joseph Sala
t: +1 212-355-4449
Certain statements, beliefs and opinions in this press release are forward-looking, which reflect the Company or, as appropriate, the Company directors' current expectations and projections about future events. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. A multitude of factors including, but not limited to, changes in demand, competition and technology, can cause actual events, performance or results to differ significantly from any anticipated development. Forward looking statements contained in this press release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. As a result, the Company expressly disclaims any obligation or undertaking to release any update or revisions to any forward-looking statements in this press release as a result of any change in expectations or any change in events, conditions, assumptions or circumstances on which these forward-looking statements are based. Neither the Company nor its advisers or representatives nor any of its parent or subsidiary undertakings or any such person's officers or employees guarantees that the assumptions underlying such forward-looking statements are free from errors nor does either accept any responsibility for the future accuracy of the forward-looking statements contained in this press release or the actual occurrence of the forecasted developments. You should not place undue reliance on forward-looking statements, which speak only as of the date of this press release.
Additional Information for US Investors
The tender offer for the outstanding ordinary shares ("Shares"), American Depositary Shares issued by J.P. Morgan Chase Bank, N.A., acting as depositary ("ADSs"), warrants ("Warrants") and convertible bonds of Ablynx ("Bonds" and, together with the Shares, ADSs and Warrants, the "Securities") has not yet commenced. This communication is for informational purposes only and is neither a recommendation, an offer to purchase nor a solicitation of an offer to sell any Securities of Ablynx.
At the time the tender offer is commenced, Sanofi will file, or cause to be filed, a tender offer statement on Schedule TO with the SEC and thereafter, Ablynx will file a solicitation/recommendation statement on Schedule 14D-9. Holders of Securities are urged to carefully review the documents that will be filed by Sanofi and Ablynx with the SEC because these documents will contain important information, including the terms and conditions of the tender offer.
The offer to purchase, the related letter of transmittal and certain other tender offer documents, as well as the solicitation/recommendation statement, are available to all holders of Securities of Ablynx at no expense to them. These documents are available for free at the SEC's website at www.sec.gov. Additional copies may be obtained for free by contacting Sanofi at ir@Sanofi.com or on Sanofi's website at https://en.Sanofi.com/investors. You should read the filings made by Sanofi and Ablynx with the SEC carefully before making a decision concerning the U.S. Offer.
 Net cash burn is the difference between the cash position of the current year and the previous year minus the proceeds (net of issue costs) from the issue of ordinary shares