On November 2, 2017 Aviragen Therapeutics, Inc. (NASDAQ:AVIR) reported its financial results for the three months ended September 30, 2017 (Press release, Nabi Biopharmaceuticals, NOV 2, 2017, View Source [SID1234521518]).
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“Earlier this week we were pleased to announce the culmination of our strategic review process with the signing of a definitive merger agreement with Vaxart, which we believe complements Aviragen’s focus on infectious diseases. With recently reported positive safety and efficacy data in both influenza and norovirus, Vaxart is well-positioned to create both short and long-term value for our stockholders,” said Joseph M. Patti, Ph.D., President and Chief Executive Officer of Aviragen Therapeutics. “Post-merger, we believe that Vaxart will be well funded to advance its norovirus and HPV oral tablet vaccine programs, and together with BTA074, the combined companies are poised to provide several meaningful value creation clinical data readouts.”
Corporate Update:
Proposed Merger with Vaxart:
The exchange ratio in the merger agreement was determined by Vaxart assigning $60,000,000 in value to Aviragen for its financial and clinical assets, and $90,000,000 in value for its own assets. On a pro forma basis after giving effect to the number of shares of Aviragen common stock issued to Vaxart security holders in the merger, current Vaxart security holders will own approximately 60% of the combined company and current Aviragen security holders will own approximately 40% of the combined company. The transactions have been approved by the boards of directors of both companies. The merger is expected to close in the first quarter of calendar year 2018, subject to the approval of the stockholders of each company as well as other customary conditions.
Upon closing of the transaction, the name of the combined company will become Vaxart, Inc. and shares of the combined company are expected to continue trading on the NASDAQ Capital Market under the proposed ticker symbol VXRT. Wouter Latour, M.D., will serve as Chief Executive Officer of the combined company.
BTA074 (teslexivir):
The Phase 2 trial of BTA074, a topical antiviral treatment for condyloma caused by human papillomavirus (HPV), is ongoing and the Company anticipates that enrollment in the 210 patient trial will be completed in the fourth quarter of calendar year 2017. Top-line safety and efficacy data is expected in the second quarter of calendar year 2018.
Financial Results for the Three Month Period Ended September 30, 2017
The Company reported a net loss of $5.3 million for the three month period ended September 30, 2017, as compared to a net loss of $10.0 million in the same quarter of the prior fiscal year. Basic and diluted net loss per share was $0.14 for the three month period ended September 30, 2017, as compared to a basic and diluted net loss per share of $0.26 in the same period in 2016. The major components of net loss in both periods are detailed below.
Revenue was $0.1 million for the three month periods ended September 30, 2017 and 2016. The 2017 revenue relates to $0.1 million in non-cash royalty revenue related to certain royalty rights that were sold to HealthCare Royalty Partners III, L.P. (HCRP) in April 2016 and the cash will be passed through to HCRP. The 2016 revenue was comprised of $0.1 million in Relenza royalties.
Research and development expense decreased to $2.8 million for the three month period ended September 30, 2017 from $7.6 million in the same period in 2016. The $4.8 million decrease largely reflected reduced clinical trial activity and manufacturing costs as two of our three Phase 2 clinical trials finished in the third quarter of fiscal 2017.
General and administrative expense increased to $2.3 million for the three month period ended September 30, 2017 from $2.2 million for the same period in 2016 due mostly to higher legal fees.
The Company held $34.1 million in cash, cash equivalents, and short-term investments as of September 30, 2017.