GenVec reports net loss of $1.9 million for second quarter 2015

Aug 7 2015

GenVec, Inc. (NASDAQ: GNVC) today reported financial results for the second quarter ended June 30, 2015. For the three months ended June 30, 2015, GenVec reported a net loss of $1.9 million, or $0.11 per share, on revenues of $0.1 million, compared with a net loss of $1.7 million, or $0.10 per share, on revenues of $0.1 million, for the same period in the prior year. For the six months ended June 30, 2015, GenVec reported a net loss of $3.4 million, or $0.21 per share, on revenues of $0.5 million, compared with a net loss of $2.6 million, or $0.17 per share, on revenues of $2.3 million, for the same period in the prior year. GenVec ended the second quarter of 2015 with $11.1 million in cash, cash equivalents, and investments.

"In the second quarter, we continued to support Novartis in their ongoing Phase 1/2 testing of CGF166 in hearing loss and are encouraged with the recent progress made. Internally, we expanded our corporate development efforts with a focus on further developing our pipeline through additional partnerships and collaborations," said Doug Swirsky, GenVec's president and CEO. "We recently began a number of research collaborations using our proprietary gorilla adenovectors including collaborations with Washington University around targeted therapeutics and vaccines, with TheraBiologics on neural stem cell mediated therapies for cancer, and with the Laboratory of Malaria Immunology and Vaccinology on novel vaccines to block the transmission of malaria. We believe that these types of collaborations are a highly cost-effective way to build the value of GenVec's technologies."

Financial Results for the Three and Six Months Ended June 30, 2015

Revenues for the three-month period ended June 30, 2015 were in line with the three-month period ended June 30, 2014 at $0.1 million. During the six-month period ended June 30, 2014, GenVec achieved the third milestone under the terms of our collaboration with Novartis, when the investigational new drug application for CGF166 filed by Novartis with the Food and Drug Administration was deemed effective, resulting in a $2 million milestone payment. There was no corresponding milestone achieved during the six-month period ended June 30, 2015, and as a result, revenues of $0.5 million reflect a 76% decrease as compared to $2.3 million in the comparable period in 2014.

Operating expenses were $2.0 million and $3.9 million for the three-month and six-month periods ended June 30, 2015, respectively, which represent an increase of 11% and a decrease of 20% as compared to $1.8 million and $4.9 million in the comparable prior year periods.

General and administrative expenses of $1.3 million for the three-month period ended June 30, 2015 were in line with the three-month period ended June 30, 2014. For the six-month period ended June 30, 2015, general and administrative expenses of $2.6 million decreased 30% as compared to $3.7 million in the comparable period in 2014. The decrease in the six-month period ended June 30, 2015 was primarily attributable to lower facility costs related to the relocation of our corporate offices and professional costs.

Research and development expenses for the three-month and six-month periods ended June 30, 2015 increased 41% and 12%, respectively, from $0.5 million and $1.2 million in 2014 to $0.7 million and $1.3 million in 2015. The increases in both the three-month and six-month periods ended June 30, 2015 were primarily due to increased personnel costs and to a lesser extent in the three-month period ended June 30, 2015, professional costs as compared to the comparable prior year periods.

2015 Cash Guidance

For the full year of 2015, GenVec expects cash burn between $5 million and $7 million. The company believes that existing resources are sufficient to fund the company's operations into 2017.