MEI Pharma Reports First Quarter Fiscal Year 2021 Results and Operational Highlights

Rhea-AI Summary

MEI Pharma, Inc. (NASDAQ: MEIP) reported its Q1 FY2021 results, highlighting a cash position of $176.1 million with no debt and a net loss of $2.1 million, or $0.02 per share. Revenues increased to $3.8 million from $1.2 million YoY, mainly due to a license agreement with Kyowa Kirin. R&D expenses rose to $13.0 million, driven by zandelisib development. The TIDAL study for follicular lymphoma is on track for enrollment completion by Q1 2021, with additional studies planned for expansion. The company remains committed to advancing its clinical pipeline amid the ongoing pandemic.

Positive

• Cash and short-term investments at $176.1 million with no debt.
• Revenue increased to $3.8 million from $1.2 million year-over-year.
• Net loss reduced to $2.1 million from $3.0 million year-over-year.
• Advancements in zandelisib development with plans for multiple studies.

Negative

• Adjusted net loss rose to $15.3 million from $12.3 million year-over-year.
• R&D expenses increased by $4 million, raising concerns over spending efficiency.

SAN DIEGO, Nov. 10, 2020 /PRNewswire/ -- MEI Pharma, Inc. (NASDAQ: MEIP), a late-stage pharmaceutical company focused on advancing new therapies for cancer, today reported results for the quarter ended September 30, 2020. 

"As we move through fiscal year 2021, we are well-positioned and well-capitalized to achieve our goals across our pipeline. Importantly, we remain focused on advancing zandelisib toward commercialization with our partner Kyowa Kirin and establishing its potential as an important treatment option in multiple lines of treatment across various B-cell malignancies," said Daniel P. Gold, Ph.D., president and chief executive officer of MEI Pharma. "Our immediate focus is the completion of enrollment in the TIDAL study evaluating patients with follicular lymphoma, a study intended to support our accelerated approval strategy with FDA. TIDAL enrollment is expected to be completed in the first quarter of 2021 subject, of course, to developments in the global COVID-19 pandemic."  

Dr. Gold continued: "Beyond TIDAL we are broadening our development activity for zandelisib, including the addition of a marginal zone arm to TIDAL to support an opportunity for potential expansion of our accelerated approval strategy if successful, the initiation of a Phase 3 study in second line follicular and marginal zone lymphomas sometime in mid-2021, and plans to support select investigator-initiated trials, initially in first-line DLBCL. Additionally, we are continuing ex-U.S. development efforts led by Kyowa Kirin, including the start of the Japan Phase 2 study to support marketing authorization in Japan. Finally, we will continue to advance the clinical development of our other wholly owned programs, voruciclib and ME-344."

First Quarter Fiscal Year 2021 Corporate Highlights

• In September 2020, MEI announced the appointment of Brian T. Powl as senior vice president, marketing, a new role reporting to David Urso, chief operating officer and general counsel. Mr. Powl joined MEI from Celgene Corporation where he served as vice president, global commercial CAR T lead.

First Quarter Fiscal Year 2021 Financial Results

• As of September 30, 2020, MEI had $176.1 million in cash, cash equivalents, and short-term investments with no outstanding debt. Additionally, MEI had a receivable of $20.4 million from the Japanese taxing authorities that was withheld from the $100 million paid by Kyowa Kirin Co. under the terms of the April 2020 global license, development and commercialization agreement. This receivable was received in October 2020.

• For the quarter ended September 30, 2020, cash used in operations was $9.1 million compared to $14.1 million for 2019.

• Research and development expenses were $13.0 million for the quarter ended September 30, 2020, compared to $9.0 million for 2019. The increase was primarily related to increased development costs associated with zandelisib, including increased activity in the TIDAL study and start-up costs related to the Phase 3 study, as well as increased personnel costs to support clinical trial activities.

• General and administrative expenses were $5.9 million for the quarter ended September 30, 2020, compared to $4.1 million for 2019. The increase primarily relates to personnel costs and general corporate expenses incurred during the quarter ended September 30, 2020.

• MEI recognized revenues of $3.8 million for the quarter ended September 30, 2020, compared to $1.2 million for the quarter ended September 30, 2019. The increase in revenue primarily related to the license agreement with Kyowa Kirin and included the recognition of fees allocated to research and development obligations, including a portion of Kyowa Kirin's share of zandelisib costs which were $4.9 million for the quarter ended September 30, 2020. Revenue also includes recognition of fees allocated to performance obligations in accordance with the Helsinn License Agreement.

• Net loss was $2.1 million, or $0.02 per share, for the quarter ended September 30, 2020, compared to net loss of $3.0 million, or $0.04 per share for 2019. The Company had 112,522,001 shares of common stock outstanding as of September 30, 2020, compared with 73,654,927 shares as of September 30, 2019.

• The adjusted net loss for the quarter ended September 30, 2020, excluding non-cash expenses related to changes in the fair value of the warrants issued in connection with the May 2018 financing (a non-GAAP measure), was $15.3 million, compared to an adjusted net loss of $12.3 million for 2019.

About MEI Pharma

MEI Pharma, Inc. (Nasdaq: MEIP) is a late-stage pharmaceutical company focused on developing potential new therapies for cancer. MEI Pharma's portfolio of drug candidates contains four clinical-stage assets, including zandelisib, currently in an ongoing Phase 2 clinical trial which may support an accelerated approval marketing application with the U.S. Food and Drug Administration. Each of MEI Pharma's pipeline candidates leverages a different mechanism of action with the objective of developing therapeutic options that are: (1) differentiated, (2) address unmet medical needs and (3) deliver improved benefit to patients either as standalone treatments or in combination with other therapeutic options. For more information, please visit www.meipharma.com.

Forward-Looking Statements 

Under U.S. law, a new drug cannot be marketed until it has been investigated in clinical studies and approved by the FDA as being safe and effective for the intended use. Statements included in this press release that are not historical in nature are "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. You should be aware that our actual results could differ materially from those contained in the forward-looking statements, which are based on management's current expectations and are subject to a number of risks and uncertainties, including, but not limited to, our failure to successfully commercialize our product candidates; costs and delays in the development and or FDA approval, or the failure to obtain such approval, of our product candidates; uncertainties or differences in interpretation in clinical trial results; the impact of the COVID-19 pandemic on our industry and individual companies, including on our counterparties, the supply chain, the execution of our clinical development programs, our access to financing and the allocation of government resources; our inability to maintain or enter into, and the risks resulting from our dependence upon, collaboration or contractual arrangements necessary for the development, manufacture, commercialization, marketing, sales and distribution of any products; competitive factors; our inability to protect our patents or proprietary rights and obtain necessary rights to third party patents and intellectual property to operate our business; our inability to operate our business without infringing the patents and proprietary rights of others; general economic conditions; the failure of any products to gain market acceptance; our inability to obtain any additional required financing; technological changes; government regulation; changes in industry practice; and one-time events. We do not intend to update any of these factors or to publicly announce the results of any revisions to these forward-looking statements.

 

MEI PHARMA, INC.
CONDENSED BALANCE SHEETS
(In thousands, except per share amounts)
	September 30,		June 30,
	2020		2020
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$              10,956		$              12,331
Short-term investments	165,179		170,299
Total cash, cash equivalents and short-term investments	176,135		182,630
Receivable for foreign tax withholding	20,420		20,420
Prepaid expenses and other current assets	7,375		5,594
Total current assets	203,930		208,644
Operating lease right-of-use asset	8,420		-
Property and equipment, net	1,659		1,084
Total assets	$            214,009		$            209,728
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$                 6,375		$                 2,437
Accrued liabilities	5,537		6,090
Deferred revenue	18,972		14,777
Operating lease liabilities	602		-
Total current liabilities	31,486		23,304
Deferred revenue, long-term	64,864		67,723
Warrant liability	27,259		40,483
Operating lease liabilties, long-term	8,072		-
Total liabilities	131,681		131,510
Stockholders' equity:
Preferred stock, $0.01 par value; 100 shares authorized;
none outstanding	-		-
Common stock, $0.00000002 par value; 226,000 shares
authorized; 112,522 and 111,514 shares issued and outstanding
at September 30, 2020 and June 30, 2020, respectively	-		-
Additional paid-in-capital	361,654		355,452
Accumulated deficit	(279,326)		(277,234)
Total stockholders' equity	82,328		78,218
Total liabilities and stockholders' equity	$            214,009		$            209,728

 

 

MEI PHARMA, INC.
CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
	Three Months Ended September 30,
	2020		2019
Revenue	$          3,834		$           1,157
Operating expenses:
Cost of revenue	509		688
Research and development	12,996		8,962
General and administrative	5,915		4,130
Total operating expenses	19,420		13,780
Loss from operations	(15,586)		(12,623)
Other income (expense):
Change in fair value of warrant liability	13,224		9,269
Interest and dividend income	275		374
Other expense	(5)		(14)
Net loss	$       (2,092)		$         (2,994)
Net loss:
Basic	$       (2,092)		$         (2,994)
Diluted	$     (15,316)		$         (2,994)
Net loss per share:
Basic	$          (0.02)		$           (0.04)
Diluted	$          (0.13)		$           (0.04)
Shares used in computing net loss per share:
Basic	112,435		73,628
Diluted	114,957		73,628

 

 

MEI PHARMA, INC.
Reconciliation of GAAP Net Loss to Adjusted Net Loss
(In thousands)
(Unaudited)
		Three Months Ended September 30,
		2020		2019
Net loss		$          (2,092)		$          (2,994)
Add: Change in fair value of warrant liability		(13,224)		(9,269)
Adjusted net loss		$        (15,316)		$        (12,263)

 

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SOURCE MEI Pharma, Inc.

FAQ

What were MEI Pharma's Q1 FY2021 financial results?

MEI Pharma reported a net loss of $2.1 million with revenues of $3.8 million for Q1 FY2021.

How much cash does MEI Pharma have as of September 30, 2020?

As of September 30, 2020, MEI Pharma had $176.1 million in cash and short-term investments.

What are the plans for zandelisib at MEI Pharma?

MEI Pharma plans to complete TIDAL study enrollment by Q1 2021 and expand studies for zandelisib.

How did MEI Pharma's net loss change compared to the previous year?

MEI Pharma's net loss decreased from $3.0 million in Q1 FY2020 to $2.1 million in Q1 FY2021.

What were the R&D expenses for MEI Pharma in Q1 FY2021?

R&D expenses for Q1 FY2021 reached $13.0 million, up from $9.0 million in the same quarter last year.