Soligenix 2011 revenues soar, net loss narrows

Soligenix (OTCBB:SNGX) said Tuesday that full year revenues rose by more than four times, as net loss narrowed.

The development stage biopharmaceutical company posted revenues for the year that ended December 31 of $7.7 million, way up from $1.9 million a year earlier.

The sharp increased reflected a $5.0 million non-refundable license fee from Sigma-Tau Pharmaceuticals, in connection with the expansion of Soligenix's existing North American commercialization rights to orBec and oral BDP into European territory. Oral BDP is being tested to treat and prevent acute radiation sickness and other gastrointestinal diseases.

BDP has been marketed in the US and worldwide since the early 1970s as the active pharmaceutical ingredient in inhalation products to treat patients with allergic rhinitis and asthma.

Soligenix's net loss for the year was $2.4 million, or a 22-cent-loss per share, as compared to a $7.4 million net loss, or 73-cent-loss per share in 2010.

The smaller loss is also attributable to the Sigma-Tau licensing agreement fee received in the third quarter, Soligenix said.

Research and development expenses for the full year were $6.3 million, up slightly from $6.0 million in the previous year.

The increase was due to a $1.0 million cash and stock payment to the company's orBec licensor in connection with the Sigma-Tau agreement, offset by reduced spending resulting from the termination of a phase 3 clinical trial for orBec in the treatment of acute gastrointestinal Graft-versus Host disease (GI GVHD).

"In 2011 we saw the unfortunate stoppage of our Phase 3 trial of orBec in acute GI GVHD at the recommendation of an independent Data Safety Monitoring Board," said president and CEO, Christopher J. Schaber.

"As a result of this event, we have restructured the organization by decreasing headcount with a continued focus on cash management and research and development program expenditures.

"We remain committed to evaluating all strategic options while we continue the development of our oral BDP programs for pediatric Crohn's disease, acute radiation syndrome and acute radiation enteritis as well as the development of our vaccine programs including our novel thermostabilization technology, ThermoVax."

The company has announced a number of notable operational achievements of late, including promising results from its preclinical study of SGX202 (oral BDP), testing for the treatment of gastrointestinal acute radiation syndrome in dogs.

The new study results indicated that dogs treated with SGX202 starting 24 hours after exposure to lethal doses of total body irradiation (TBI) demonstrated "statistically significant" improvement in survival when compared to control dogs.

The company said these results show that SGX202 has the potential to reduce the inflammatory storm induced by the radiation-damaged GI tract.

Also earlier this year, the company unveiled preliminary results from a phase 1/2 clinical trial of SGX201, a time-release formulation of oral BDP for the prevention of  acute radiation enteritis. The study showed that oral administration of SGX201 was safe and well tolerated across all four dose groups.

Acute radiation enteritis is caused by the radiation-induced death of cells in the lining of the bowel. As bowel cells die and are not replaced, there is a resulting inflammatory response to dead cells and bacteria, with diarrhea, nausea, vomiting and pain being prominent symptoms.

The addition of chemotherapy may exacerbate the intestinal symptoms, and can result in the delay or interruption of the cancer treatment. There are over 100,000 patients each year in the United States who receive abdominal or pelvic external beam radiation treatment for cancer, and these patients are at risk of developing radiation enteritis.

Sixteen subjects with rectal cancer scheduled to undergo concurrent radiation and chemotherapy prior to surgery were enrolled in one of four dose groups in the study, with dosing administered throughout the duration of radiation therapy plus one week.

The main goal of the study was to evaluate the safety and tolerability of escalating doses of SGX201, as well as to assess the preliminary efficacy of SGX201 for the prevention of signs and symptoms of acute radiation enteritis.

In addition, the incidence of diarrhea was lower than that seen in recent published historical control data in this patient population, the company said.

The company also announced positive results from preclinical studies of its proprietary vaccine thermo-stabilization technology, establishing proof-of-concept.

The company's technology allows vaccines that usually need to be refrigerated to maintain their efficacy at higher temperatures.

Soligenix used its aluminum-adjuvant ricin toxin vaccine, RiVax, in the study. RiVax was developed under lyophilization conditions, and uses an active carrier to help maintain the protein structure of the ricin A chain, which provides the immunogenic component of the drug.

The lyophilization process is often employed to extend the shelf life of drugs, by removing the water from the pharmaceutical preparation. Vaccines that undergo this process often lose their potency, especially if the vaccine is made with aluminum salt adjuvants, as most are.

For this reason, many vaccines need to be refrigerated or frozen, and as a result, the World Health Organization (WHO) estimates that about half of all global vaccine doses are wasted.

Like other aluminum-adjuvanted vaccines, RiVax usually requires temperatures at or below eight degrees Celsius for storage and efficacy. However, using Soligenix's tehcnology and the lyophilization process, the company found that the vaccine provided strong, neutralizing antibodies, even in temperatures as high as 40 degrees Celsius.

Therefore, Soligenix's technology is especially valuable in biodefense or pandemic situations, where drugs need to be stockpiled for a long period of time.

Under its biodefense unit, the company is also developing SGX204, a vaccine against anthrax exposure.

As at year-end 2011, the company's cash position was $6.0 million with working capital of $5.7 million.