Interim / Quarterly Report • Aug 23, 2022
Interim / Quarterly Report
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"The prioritization of bemcentinib development in two key areas in the second quarter has created momentum entering the second half of the year.
By following strong scientific rationale, clinical and preclinical data, and areas of significant unmet medical need, we are confidently enthusiastic about bemcentinib's potential in aiding patients in the two indications of focus: STK11 mutated Non-Small Cell Lung Cancer and patients hospitalized by COVID-19.
The initiation of the next phase of clinical development for both indications in 2H22 moves us a meaningful step closer to addressing two large patient populations that are in need of better treatments."
| (NOK million) | Q2 2022 | Q2 2021 | YTD 2022 | YTD 2021 | FY 2021 |
|---|---|---|---|---|---|
| Operating revenues | 0,0 | 0,0 | 0,0 | 0,0 | 0,8 |
| Operating expenses | 88,2 | 92,3 | 166,8 | 175,7 | 315,2 |
| Operating profit (-loss) | -88,2 | -92,3 | -166,8 | -175,7 | -314,5 |
| Profit (-loss) after tax | -84,1 | -88,9 | -165,1 | -170,1 | -309,4 |
| Basic and diluted earnings (loss) per | |||||
| share (NOK) | -0,95 | -1,02 | -1,86 | -1,94 | -3,52 |
| Net cash flow in the period | -70,3 | -82,4 | -141,5 | -144,2 | -284,2 |
| Cash position end of period | 292,1 | 574,0 | 292,1 | 574,0 | 436,6 |
Operating loss
(90)
(80)
(70)
(60)
(50)
(40)
(30)
(20)
(10)
-
BerGenBio's lead compound, bemcentinib, is a potent, first-in-class, oral, small molecule, highly selective inhibitor of the receptor tyrosine kinase AXL, which is overexpressed in response to cellular stress, inflammation, hypoxia and chemotherapy. Bemcentinib inhibits the host cells' ability to propagate the progression of serious disease through the modulation of resistance mechanisms and the adaptive immune system.
The Company is advancing bemcentinib development in two lung indications, STK11 mutated (STK11m) Non-Small Cell Lung Cancer (NSCLC) and Hospitalized COVID-19 patients, where bemcentinib's novel mechanisms of action and primary accumulation in the lungs make it uniquely positioned to address severe lung diseases.
BerGenBio is preparing a Phase 1b/2a trial of bemcentinib in 1L STK11m NSCLC, a group that represents approximately 20% of NSCLC patients. Mutations in the STK11 gene are highly correlated with poor treatment response and survival with today's standard of care treatments, including immune checkpoint inhibitors in NSCLC. Through inhibition of AXL, bemcentinib seeks to prevent AXL activation, consequently removing the innate immunosuppression that it causes and driving the proliferation of immune cells to restore sensitivity to immune checkpoint therapy. UT Southwestern Medical Center in Texas has shown that bemcentinib in models of NSCLC has the ability to restore the sensitivity of checkpoint inhibitors. Further bemcentinib is also believed to delay the development of chemoresistance.
Bemcentinib is currently being studied in a Phase 2b clinical trial in hospitalized COVID-19 patients. AXL, when induced by an infection, such as COVID-19, is known to play a variety of key roles in transporting the virus into cells, aiding replication, and dampening immune responses. Bemcentinib selectively inhibits AXL to block viral entry, stimulate the innate immune system and facilitate tissue repair regardless of known variants or mutation.
Post period, ADC Therapeutics announced dosing of the first patient n a Phase 1 clinical trial evaluating mipasetamab uzoptirine as a single agent and in combination with gemcitabine in patients with selected advanced solid tumors. Mipasetamab uzoptirine contains an AXL-targeting humanized monoclonal antibody licensed from BerGenBio. BerGenBio received a financial milestone in 2019 for the first Phase I study under the license agreement with ADC Therapeutics. Subject to further development and marketing of mipasetamab uzoptirine, BerGenBio is entitled to additional milestones and royalties.
Bemcentinib is being investigated in 2L AML (BGB003) and 2L NSCLC (BGB008) trials which are fully enrolled and topline data from each of such studies will be reported when available. Further, bemcentinib is being investigated in several Investigator Led Trials which will generate further data on bemcentinib and its potential applications. Tilvestamab is current being investigated in a Phase 1b trial in ovarian cancer and data will be reported when available.
BerGenBio strengthened its leadership team in April 2022 with the addition of Cristina Oliva, M.D., as Chief Medical Officer. Dr. Oliva is a Board-certified oncologist with over 20 years of senior clinical development experience across large pharmaceutical, biotechnology and CROs, including her most recent position as Vice President, Oncology and Head of Oncology Centre of Excellence at IQVIA, Ltd.
The Group operates in a highly competitive industry sector with many large players and may be subject to rapid and substantial technological change.
BerGenBio is currently in a development phase involving activities that entail exposure to various risks. BerGenBio's lead product candidate bemcentinib is currently in Phase II clinical trials. This is regarded as an early stage of development and the clinical studies may not prove to be successful. Timelines for completion of clinical studies are to some extent dependent on external factors outside the control of the Group, including resource capacity at clinical trial sites, competition for patients, etc.
The financial success of BerGenBio and / or its commercial partners requires obtaining marketing authorisation and securing an acceptable reimbursement price for its drugs. There can be no guarantee that the drugs will obtain the selling prices or reimbursement rates foreseen.
BerGenBio and / or its commercial partners will need approvals from the US Food & Drug Administration (FDA) to market its products in the US, and from the European Medicines Agency (EMA) to market its products in Europe, as well as equivalent regulatory authorities in other worldwide jurisdictions to commercialise in those regions. The future earnings are likely to be largely dependent on the timely marketing authorisation of bemcentinib for various indications.
The Group holds cash and cash equivalents and does not have any borrowings. The Group's interest rate risk is therefore in the rate of return of its cash on hand. Bank deposits are exposed to market fluctuations in interest rates, which affect the financial income and the return on cash.
The value of non-Norwegian currency denominated costs will be affected by changes in currency exchange rates or exchange control regulations. The Group undertakes various transactions in foreign currencies and is consequently exposed to fluctuations in exchange rates. The exposure arises largely from the clinical trials and research expenses. The Group is mainly exposed to fluctuations in euro (EUR), pounds sterling (GBP) and US dollar (USD). The Group are holding part of the bank deposit in EUR, GBP and USD depending on the need for such foreign exchange.
The foreign currency exposure is also mostly linked to trade payables with short payment terms. The Group might consider changing its current risk management of foreign exchange rate if it deems it appropriate.
Credit risk is the risk of counterparty's default in a financial asset, liability or customer contract, giving a financial loss. The Group's receivables are generally limited to receivables from public authorities by way of government grants. The credit risk generated from financial assets in the Group is limited since it is cash deposits. The Group places its cash in bank deposits in recognised financial institutions to limit its credit risk exposure.
The Group has not suffered any loss on receivables during 2022 and the Group considers its credit risk as low.
Liquidity is monitored on a continued basis by Group management.
The Group works continuously to ensure financial flexibility in the short and long term to achieve its strategic and operational objectives.
Funding of ongoing operations is and will be for some time depending on external sources, mainly equity contributions. Significant changes to financial market conditions, may affect the climate for investor investments.
Management considers the Group's liquidity situation to be satisfactory.
The Group's lead product candidate, bemcentinib, is currently in Phase II clinical trials and the Group's clinical studies may not prove to be successful.
The Group operates in a highly competitive industry sector with many large players and is subject to rapid and substantial technological change.
The success of the company will highly depend on the company's ability to obtain and maintain patent protection for its products, methods, processes and other technologies, to prevent third parties from infringing proprietary rights of the company and to operate without infringing the proprietary rights of third parties. To date, the company holds certain exclusive patent rights in major markets. The patent rights are limited in time. The company cannot predict the range of protection any patents will afford against competitors and competing technologies, including whether third parties will find ways to invalidate the patents, obtain patents claiming aspects similar to those covered by the company's patents and patents applications, and whether the company may be subject to litigation proceedings.
The financial success of the Group requires obtaining marketing authorisation and achieving an acceptable reimbursement price for its drugs. There can be no guarantee that the Group's drugs will obtain the selling prices or reimbursement rates foreseen by the Group. The Group will need approvals from the US Food and Drug Administration (FDA) to market its products in the US, and from the European Medicines Agency (EMA) to market its products in Europe, as well as equivalent regulatory authorities in other worldwide jurisdictions to commercialise in those regions. The Group's future earnings are likely to be largely dependent on the timely marketing authorisation of bemcentinib for various indications.
The long-term impact of the COVID-19 crisis remains unclear although no greater for BerGenBio than any other business in the sector. Our ability to conduct clinical trials at the expected pace is a risk factor in the evolving pandemic.
(Figures in brackets = same period 2021 unless stated otherwise)
Revenue for the second quarter 2022 amounted to NOK 0.0 million (NOK 0 million) and for the first half year 2022 NOK 0 million (NOK 0 million).
Total operating expenses for the second quarter 2022 amounted to NOK 88.2 million (NOK 92.3 million) and for the first half year 2022 NOK 166.8 million (NOK 175.7 million).
Payroll and other employee related cost in the second quarter was NOK 21.1 million (NOK 16.1 million) and for the first half year 2022 NOK 36.2 million (NOK 30.6 million). The increase in Q2 2022 compared to Q2 2021 is related to restructuring cost.
Employee share option cost in the second quarter was positive NOK 0.6 million (cost of NOK 0.5 million) and for the first half year 2022 NOK 0.8 million (NOK 2.4 million). The decrease in cost in Q2 2022 compared to Q2 2021 is a non-cash effect due to the reduction in social security tax provision on share options driven by a decrease in share price as well as effect of restructuring.
Other operating expenses amounted to NOK 67.4 million (NOK 75.4 million) for the second quarter and NOK 129.2 million (NOK 142.0 million) for the first half year 2022. Operating expenses are driven by the timing of cost of the clinical trials and drug manufacturing in preparations for clinical trial launches.
The operating loss for the second quarter came to NOK 88.2 million (NOK 92.3 million) and for the first half year 2022 NOK 166.8 million (NOK 175.7 million), reflecting the level of activity related to the clinical trials BerGenBio is conducting.
Net financial items amounted to a profit of NOK 4.2 million (profit of NOK 3.5 million) for the second quarter related to foreign exchange rates. For the first half year 2022 the net financial items amounted to a profit of NOK 1.7 million (profit of NOK 5.6 million).
Losses after tax for the second quarter were NOK 84.1 million (NOK 88.9 million) and for the first half year 2022 NOK 165.1 million (NOK 170.1 million).
Total assets as of 30 June 2022 decreased to NOK 306.0 million (NOK 380.6 million at 31 March 2022) mainly due to the operational loss in the period.
Total liabilities were NOK 82.0 million as of 30 June 2022 (NOK 72.6 million at 31 March 2022).
Total equity as of 30 June 2022 was NOK 224.0 million (NOK 308.0 million as of 31 March 2022), corresponding to an equity ratio of 73.2% (80.9% as of 31 March 2022).
Net cash flow from operating activities was negative by NOK 70.7 million in the second quarter (negative by 84.4 million) and NOK 144.9 million for the first half year 2022 (NOK 154.3 million), mainly driven by the level of activity in the clinical trials and drug development.
Net cash flow from investing during the second quarter was NOK 0.4 million (NOK 0.1 million) and for the first half year 2022 NOK 0.5 million (NOK 0.1 million).
Net cash flow from financing activities in second quarter 2022 was negative by NOK 0.1 million (NOK 1.9 million) and for the first half year 2022 NOK 2.9 million (NOK 10.0 million).
Cash and cash equivalents decreased to NOK 292.1 million by 30 June 2022 (NOK 367.8 by 31 March 2022 and NOK 574.0 by 30 June 2021).
The Board's aim is to continue its work towards a number of upcoming milestones, to be achieved across its oncology and infectious diseases pipeline.
The Company has reiterated its focus on the clinical development of bemcentinib within NSCLC STK11m and respiratory diseases (initially COVID-19). Each of the therapeutic areas represents attractive commercial opportunities.
The Company remains funded to progress its activities with a strong team in place to continue the advancement of its pipeline and working towards delivering new treatment options for patients in need and value for shareholders.
The Board today considered and approved the condensed, consolidated financial statement of the six months ending 30 June 2022 for BerGenBio.
Anders Tullgren, Chairman Sally Bennett
Sveinung Hole François Thomas
Debra Barker Martin Olin, CEO
The board today considered and approved the condensed, consolidated financial statement for the six months ending 30 June 2022 for BerGenBio. The half year report has been prepared in accordance with IAS 34 Interim Financial Reporting as endorsed by the EU and additional Norwegian regulation.
We confirm, to the best of our knowledge that the financial statements for the period 1 January to 30 June 2022 have been prepared in accordance with current applicable accounting standards, and give a true and fair view of the assets, liabilities, financial position and profit or loss of the entity and the group taken as a whole.
We also confirm that the Board of Directors' Report includes a true and fair view of the development and performance of the business and the position of the entity and the group, together with a description of the principal risks and uncertainties facing the entity and the group.
Anders Tullgren, Chairman Sally Bennett
Sveinung Hole François Thomas
Debra Barker Martin Olin, CEO
| (NOK 1000) Unaudited | Note | Q2 2022 | Q1 2021 | YTD 2022 | YTD 2021 | FY 2021 |
|---|---|---|---|---|---|---|
| Revenue | 0 | 0 | 0 | 0 | 774 | |
| Expenses Payroll and other related employee |
||||||
| cost | 3, 10 | 21,149 | 16,136 | 36,226 | 30,628 | 69,929 |
| Employee share option cost | 3 | -605 | 466 | 791 | 2,414 | 4,116 |
| Depreciation | 2 | 314 | 335 | 631 | 670 | 1,312 |
| Other operating expenses | 6 | 67,380 | 75,368 | 129,156 | 142,013 | 239,880 |
| Total operating expenses | 88,238 | 92,306 | 166,804 | 175,725 | 315,237 | |
| Operating profit (-loss) | -88,238 | -92,306 | -166,804 | -175,725 | -314,464 | |
| Finance income | 5,970 | 4,570 | 6,373 | 8,938 | 15,993 | |
| Finance expense | 1,802 | 1,119 | 4,706 | 3,313 | 10,894 | |
| Financial items, net | 4,168 | 3,451 | 1,667 | 5,625 | 5,100 | |
| Profit (-loss) before tax | -84,070 | -88,855 | -165,136 | -170,099 | -309,364 | |
| Income tax expense | 0 | 0 | 0 | 0 | 0 | |
| Profit (-loss) after tax | -84,070 | -88,855 | -165,136 | -170,099 | -309,364 | |
| Other comprehensive income | ||||||
| Items that may be reclassified to profit and loss in subsequent periods |
||||||
| Translation effects | -86 | 0 | -45 | 0 | -112 | |
| Total comprehensive income (-loss) for the period |
-84,156 | -88,855 | -165,182 | -170,099 | -309,476 | |
| Earnings per share: | ||||||
| - Basic and diluted per share | 7 | -0.95 | -1.02 | -1.86 | -1.94 | -3.52 |
| (NOK 1000) Unaudited | Note | 30 JUN 2022 | 30 JUN 2021 | 31 DEC 2021 |
|---|---|---|---|---|
| ASSETS | ||||
| Non-current assets | ||||
| Property, plant and equipment | 560 | 1,833 | 1,191 | |
| Total non-current assets | 560 | 1,833 | 1,191 | |
| Other current assets | 5, 8 | 13,325 | 8,909 | 12,398 |
| Cash and cash equivalents | 292,144 | 574,033 | 436,646 | |
| Total current assets | 305,469 | 582,943 | 449,045 | |
| TOTAL ASSETS | 306,030 | 584,776 | 450,236 | |
| EQUITY AND LIABILITIES | ||||
| Equity | ||||
| Paid in capital | ||||
| Share capital | 9 | 8,866 | 8,796 | 8,846 |
| Share premium | 9 | 173,204 | 468,311 | 335,195 |
| Other paid in capital | 4, 9 | 41,928 | 37,786 | 40,386 |
| Total paid in capital | 223,998 | 514,894 | 384,426 | |
| Total equity | 223,998 | 514,894 | 384,426 | |
| Non-current liabilities | ||||
| Long term debt | 651 | 1,240 | 942 | |
| Total non-current liabilities | 651 | 1,240 | 942 | |
| Current liabilities | ||||
| Accounts payable | 26,040 | 15,929 | 26,726 | |
| Other current liabilities | 5,340 | 50,274 | 37,172 | |
| Provisions | 0 | 2,439 | 969 | |
| Total current liabilities | 81,381 | 68,642 | 64,868 | |
| Total liabilities | 82,031 | 69,882 | 65,810 | |
| TOTAL EQUITY AND LIABILITIES |
306,030 | 584,776 | 450,236 |
| (NOK 1000) Unaudited | Note | Share capital |
Share premium |
Other paid in capital |
Total equity | |
|---|---|---|---|---|---|---|
| Balance as of 1 January 2022 | 8,846 | 335,195 | 40,386 | 384,426 | ||
| Loss for the period Other comprehensive income (loss) for the |
-165,136 | -165,136 | ||||
| period, net of income tax | -45 | -45 | ||||
| Total comprehensive income for | ||||||
| the period | 0 -165,182 |
0 | -165,182 | |||
| Recognition of share-based | ||||||
| payments | 3, 4 | 1,543 | 1,543 | |||
| Issue of ordinary shares | 9 | 21 | 3,198 | 3,218 | ||
| Share issue costs | 9 | -7 | -7 | |||
| Transactions with owners | 21 | 3,191 | 1,543 | 4,754 | ||
| Balance as of 30 June 2022 | 8,866 | 173,204 | 41,928 | 223,998 |
| (NOK 1000) Unaudited | Note | Share capital |
Share premium |
Other paid in capital |
Total equity | |
|---|---|---|---|---|---|---|
| Balance as of 1 January 2021 |
8,726 | 628,231 | 33,272 | 670,229 | ||
| Loss for the period Other comprehensive income (loss) for the |
-170,099 | -170,099 | ||||
| period, net of income tax |
0 | 0 | ||||
| Total comprehensive income for the | ||||||
| period | 0 | -170,099 | 0 | -170,099 | ||
| Recognition of share-based payments |
3, 4 | 4,514 | 4,514 | |||
| Issue of ordinary shares |
9 | 70 | 10,218 | 10,288 | ||
| Share issue costs | 9 | -38 | -38 | |||
| Transactions with owners |
70 | 10,179 | 4,514 | 14,764 | ||
| Balance as of 30 June 2021 | 8,796 | 468,311 | 37,786 | 514,894 |
| (NOK 1000) Unaudited | Note | Q2 2022 | Q2 2021 | YTD 2022 | YTD 2021 | FY 2021 |
|---|---|---|---|---|---|---|
| Cash flow from operating activities | ||||||
| Loss before tax | -84,156 | -88,855 | -165,182 | -170,099 | -309,476 | |
| Adjustments for: Depreciation of property, plant and equipment |
314 | 335 | 631 | 670 | 1,312 | |
| Share-based payment expense | 3, 4 | 114 | 2,543 | 1,543 | 4,514 | 7,113 |
| Movement in provisions and pensions | -887 | -2,325 | -969 | -3,569 | -5,039 | |
| Currency gains not related to operating activities |
5,363 | 2,935 | 3,042 | 3,372 | 667 | |
| Net interest received | -445 | -139 | -530 | -139 | -3,130 | |
| Working capital adjustments: Decrease in trade and other receivables and prepayments |
-1,429 | 2,748 | -927 | 5,319 | 1,830 | |
| Increase in trade and other payables | 10,433 | -1,668 | 17,498 | 5,587 | 3,270 | |
| Net cash flow from operating activities | -70,694 | -84,426 | -144,894 | -154,346 | -303,340 | |
| Cash flows from investing activities | ||||||
| Net interest received | 445 | 139 | 530 | 139 | 3,130 | |
| Purchase of property, plant and equipment | ||||||
| Net cash flow from investing activities | 445 | 139 | 530 | 139 | 3,130 | |
| Cash flows from financing activities | ||||||
| Proceeds from issue of share capital | 9 | 1,952 | 3,218 | 10,288 | 16,629 | |
| Share issue costs | 9 | -23 | -7 | -38 | -70 | |
| Repayment of lease liabilities | -74 | -61 | -307 | -278 | -565 | |
| Net cash flow from financing activities | -74 | 1,868 | 2,904 | 9,972 | 15,995 | |
| Effects of exchange rate changes on cash and cash equivalents Net increase/(decrease) in cash and |
-5,363 | -2,935 | 3,042 | -3,372 | -779 | |
| cash equivalents Cash and cash equivalents at beginning |
-70,323 | -82,419 | -141,460 | -144,236 | -284,216 | |
| of period Cash and cash equivalents at end of |
367,829 | 659,388 | 436,646 | 721,641 | 721,641 | |
| period | 292,144 | 574,033 | 292,144 | 574,034 | 436,646 |
BerGenBio ASA ("the Company") and its subsidiary (together "the Group") is a clinical stage biopharmaceutical company focused on developing novel medicines for aggressive diseases, including advanced, treatment-resistant cancers and COVID-19.
BerGenBio ASA is a limited public liability company incorporated and domiciled in Norway. The address of the registered office is Jonas Lies vei 91, 5009 Bergen, Norway.
The condensed interim financial information is unaudited. These interim financial statements cover the three-months period ended 30 June 2022 and were approved for issue by the Board of Directors on 22 August 2022.
The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2021.
The new and amended standards and interpretations from IFRS that were adopted by the EU with effect from 2021 did not have any significant impact on the reporting for Q2 2022.
The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.
Amounts are in Norwegian kroner (NOK) unless stated otherwise. The functional currency of the group is NOK. BerGenBio Limited has changed functional currency to GBP from 1 November 2021.
The consolidated financial statements comprise the financial statements of the Company and its subsidiary as of 30 June 2022. The subsidiary is BerGenBio Limited, located in Oxford in the United Kingdom and is 100% owned and controlled by the parent company BerGenBio ASA.
Preparation of the accounts in accordance with IFRS requires the use of judgment, estimates and assumptions that have consequences for recognition in the balance sheet of assets and liabilities and recorded revenues and expenses. The use of estimates and assumptions are based on the best discretionary judgment of the Group's management. The Group works continuously to ensure financial flexibility in the short and long term to achieve its strategic and operational objectives.
Capital markets are used as a source of liquidity when this is appropriate and when conditions in these markets are acceptable. The company secured in total NOK 740 million in new equity funding during 2020. Cash position at end of Q2 2022 was NOK 292 million, and the Board of Directors has reasonable expectation that the Group will maintain adequate resources to continue in operational existence for the foreseeable future. The interim financial statements are prepared under the going concern assumption.
| First half year | ||||
|---|---|---|---|---|
| Q2 2022 | Q2 2021 | 2022 | 2021 | |
| Salaries | 18,404 | 13,597 | 30,701 | 25,713 |
| Social security tax | 1,657 | 1,544 | 3,407 | 3,166 |
| Pension expense | 1,268 | 1,153 | 2,308 | 2,062 |
| Short term incentive | 0 | 0 | 0 | 0 |
| Other remuneration and employee expenses | 161 | 220 | 495 | 445 |
| Government grants 1) | -342 | -378 | -685 | -758 |
| Total payroll and other employee related cost | 21,149 | 16,136 | 36,226 | 30 628 |
| Share option expense employees Change in accrued social security tax on share |
114 | 2,543 | 1,543 | 4,514 |
| options | -719 | -2,077 | -752 | -2,100 |
| Total employee share option cost | -605 | 466 | 791 | 2 414 |
| Total employee benefit cost | 20,544 | 16,603 | 37,016 | 33,042 |
| Average number of full time equivalent employees | 40 | 46 |
1) See also note 5 for government grants
The Group has a Long Term Incentive Program for employees, an option scheme program. Each option gives the right to acquire one share in BerGenBio at exercise.
The program ensures focus and aligns the Group's long term performance with shareholder values and interest. Most of the employees in the Group take part in the option program. The program also serves to attract and retain senior management.
The exercise price for options granted is set at the market price of the shares at the time of grant of the options. In general, for options granted after 2012 the options expire eight years after the date of grant.
| Total options | Number of options |
First half year 2022 Weighted average exercise price |
Number of options |
First half year 2021 Weighted average exercise price |
|---|---|---|---|---|
| Balance as of 1 January | 3,560,897 | 22,96 | 4,209,232 | 18,45 |
| Granted during the period | 1,379,871 | 28,55 | ||
| Exercised during the period | -205,277 | 15,68 | -702,772 | 14,64 |
| Forfeited and cancelled | -831,326 | 27,52 | -88,139 | 24,79 |
| Balance as of 30 June | 2,524,294 | 22,05 | 4,798,192 | 21,81 |
0 options were granted in the six months period ended 30 June 2022 and 1.379.871 options were granted in the sixt months period ended 30 June 2021.
| Vested options | First half year | |
|---|---|---|
| 2022 | 2021 | |
| Options vested as of 1 January | 1,541,168 | 1,887,201 |
| Exercised and forfeited in the period | -641,088 | -730,695 |
| Vested in the period | 832,844 | 847,160 |
| Options vested as of 30 June | 1,732,924 | 2,003,666 |
| Total outstanding number of options | 2,524,294 | 4,798,192 |
The options are valued using the Black-Scholes model.
The risk free interest rates are based on rates from Norges Bank and Oslo Børs on the Grant Date (bonds and certificates) equal to the expected term of the option being valued. Where there is no exact match between the term of the interest rates and the term of the options, interpolation is used to estimate a comparable term.
The vesting period is the period during which the conditions to obtain the right to exercise must be satisfied. The Group has estimated an expected vesting date and this date is used as basis for the expected lifetime. The Group expects the options to be exercised earlier than the expiry date. For Options granted earlier than 2014, the mean of the expected vesting date and expiry date has been used to calculate expected lifetime due to the lack of exercise pattern history for the Group and experience from other companies in combination with the relatively long lifetime of these options (up to 8 years).
For valuation purposes 66,54 % expected future volatility has been applied.
For the six months period ending 30 June the value of the share options expensed through the profit or loss amounts to NOK 1.5 million (for the same period in 2021: NOK 4.5 million). In addition, a change in provision for social security contributions on share options of NOK -0.8 million (for the same period in 2021: NOK - 2.1 million). The provision for social security contribution is calculated on the difference between the share price and exercise price on exercisable option as at the end of the period.
| Option holder | Position | Number of options outstanding 30 Jun 2022 |
Weighted Average Strike Price 2022 |
Number of options outstanding 30 Jun 2021 |
Weighted Average Strike Price 2021 |
|---|---|---|---|---|---|
| Rune Skeie | Chief Financial Officer | 297,097 | 22,71 | 297,097 | 22,71 |
| James Barnes | Chief Operating Officer | 301,522 | 19,85 | 301,522 | 19,85 |
| 598,619 | 598,619 |
Government grants have been recognised in the profit and loss as a reduction of related expense with the following amounts:
| First half year | ||||
|---|---|---|---|---|
| Q2 2022 | Q2 2021 | 2022 | 2021 | |
| Employee benefit expenses | 342 | 378 | 685 | 758 |
| Other operating expenses | 1,414 | 578 | 2,827 | 1,153 |
| Total | 1,756 | 955 | 3,512 | 1,910 |
| 30 Jun 2022 |
30 Jun 2021 |
|
|---|---|---|
| Grants from Research Council, BIA | 172 | 566 |
| Grants from Research Council, PhD | 265 | 389 |
| Grants from SkatteFunn | 7,125 | 4,750 |
| Grants R&D UK | 4,262 | 4,243 |
| Total grants receivable | 11,823 | 9,948 |
The Company currently has one grant from the Research Council, programs for user-managed innovation arena (BIA) in 2022.
The BIA grant ("AXL as a therapeutic target in fibrosis; biology and biomarkers") has been awarded from 2019 and amount up to NOK 10.7 million. The Group has recognized NOK 0.3 million in Q2 2022 (Q2 2021: NOK 1.1 million) classified partly as reduction of payroll and related expenses and partly as a cost reduction of other operating expenses
BerGenBio has been awarded two grants supporting industrial PhD's in 2020. The fellowship covers 50 % of the established current rates for doctoral research fellowships and an operating grant to cover up to 50 % of additional costs related to costly laboratory testing connected with the research fellow's doctoral work.
The Group has recognized NOK 0.8 million in Q2 2022 (Q2 2021 : NOK 0.8 million) classified partly as reduction of payroll and related expenses and partly as a cost reduction of other operating expenses.
BerGenBio has been awarded a NOK 24 million (USD 2.85 million) grant from Innovation Norway to support the clinical development of BGB324 in combination with Merck & Co.'s KEYTRUDA® (pembrolizumab) in patients with advanced lung cancer. The grant from Innovation Norway is an Industrial Development Award (IFU). The IFU program is directed to Norwegian companies developing new products or services in collaboration with foreign companies.
BerGenBio has by end of 2020 recognized and received the total grant of NOK 24 million. The grant may be withdrawn under certain circumstances.
R&D projects have been approved for SkatteFunn (a Norwegian government R&D tax incentive program designed to stimulate R&D in Norwegian trade and industry) for the period from 2021 until the end of 2023. The Group has recognized NOK 2.4 million in Q2 2022 (Q2 2021: NOK 0.0 million) classified partly as reduction of payroll and related expenses and partly as a cost reduction of other operating expenses.
BerGenBio Limited, a 100% subsidary of BerGenBio ASA, has been granted R&D tax grants in UK from 2017. R&D grants are approved retrospect by application. The Group has in first half year 2022 recognised NOK 0.0 (first half year 2021: NOK 0.0 mill) classified as reduction of payroll and related expenses.
| First half year | ||||
|---|---|---|---|---|
| Q2 2022 | Q2 2021 | 2022 | 2021 | |
| Program expenses, clinical trials and research | 53,276 | 65,117 | 105,055 | 118,783 |
| Office rent and expenses | 994 | 608 | 1,722 | 995 |
| Consultants R&D projects | 1,762 | 3,674 | 4,219 | 7,823 |
| Patent and licence expenses | 2,510 | 2,030 | 3,339 | 4,074 |
| Other operating expenses | 10,252 | 4,516 | 17,648 | 11,490 |
| Government grants | -1,414 | -578 | -2,827 | -1,153 |
| Total | 67,380 | 75,368 | 129,156 | 142,013 |
| Q2 2022 | Q2 2021 | YTD 2022 | YTD 2021 | |
|---|---|---|---|---|
| Loss for the period (NOK 1,000) | -84,156 | -88,855 | -165,182 | -170,099 |
| Average number of outstanding shares during the period |
88,660,532 | 87,318,158 | 88,612,055 | 87,658,459 |
| Earnings (loss) per share - basic and diluted (NOK) |
-0.95 | -1.02 | -1.86 | -1.94 |
Share options issued have a potential dilutive effect on earnings per share. No dilutive effect has been recognized as potential ordinary shares only shall be treated as dilutive if their conversion to ordinary shares would decrease earnings per share or increase loss per share from continuing operations. As the Group is currently loss-making an increase in the average number of shares would have anti-dilutive effects.
| 30 Jun 2022 | 30 Jun 2021 | |
|---|---|---|
| Government grants | 11,823 | 7,535 |
| Refundable VAT | 259 | 163 |
| Prepaid expenses | 1,214 | 1,151 |
| Other receivables | 29 | 60 |
| Total | 13,325 | 8,909 |
| As of 30 June | Number of shares |
Nominal value (NOK) |
Book value (NOK) |
|---|---|---|---|
| Ordinary shares 2022 | 88,660,532 | 0.10 | 8 866 053,20 |
| Ordinary shares 2021 | 87,962,755 | 0.10 | 8 796 275,50 |
| First half year | ||
|---|---|---|
| Changes in the outstanding number of shares | 2022 | 2021 |
| Ordinary shares as of 1 January | 88,455,255 | 87,259,983 |
| Issue of ordinary shares | 205,277 | 702,772 |
| Ordinary shares as of 30 June | 88,660,532 | 87,962,755 |
| Shareholder | Number of shares |
% share of total shares |
|
|---|---|---|---|
| METEVA AS | 24,039,650 | 27,1 % | |
| INVESTINOR DIREKTE AS | 7,270,780 | 8,2 % | |
| FJARDE AP-FONDEN | 4,487,493 | 5,1 % | |
| SARSIA SEED AS | 2,117,900 | 2,4 % | |
| J.P. Morgan SE | NOMINEE I | 1,726,731 | 1,9 % |
| BERA AS | 1,712,426 | 1,9 % | |
| VERDIPAPIRFONDET NORDEA AVKASTNING | 1,510,174 | 1,7 % | |
| SARSIA DEVELOPMENT AS | 1,175,000 | 1,3 % | |
| NORDNET LIVSFORSIKRING AS | 1,093,868 | 1,2 % | |
| VERDIPAPIRFONDET NORDEA NORGE PLUS | 909,260 | 1,0 % | |
| VERDIPAPIRFONDET NORDEA KAPITAL | 889,920 | 1,0 % | |
| VERDIPAPIRFONDET NORDEA NORGE VERD | 864,688 | 1,0 % | |
| MOHN, MARIT | 850,000 | 1,0 % | |
| MARSTIA INVEST AS | 850,000 | 1,0 % | |
| VERDIPAPIRFONDET KLP AKSJENORGE IN | 519,530 | 0,6 % | |
| MOHN, LOUISE | 509,676 | 0,6 % | |
| J.P. Morgan SE | NOMINEE II | 430,541 | 0,5 % |
| RO INVEST AS | 350,000 | 0,4 % | |
| Nordnet Bank AB | NOMINEE | 339,242 | 0,4 % |
| BIRK VENTURE AS | 330,000 | 0,4 % | |
| Top 20 shareholders | 51,976,879 | 58,6 % | |
| Total other shareholders | 36,683,653 | 41,4 % | |
| Total number of shares | 88,660,532 | 100,0 % |
The Board of Directors has been granted a mandate from the general meeting held on 28 April 2022 to increase the share capital with up to NOK 883,605 by subscription of new shares. The power of attorney was granted for the purpose of issuance of new shares in accordance with the Company's share incentive program and is valid until the earlier of the annual general meeting in 2023 and 30 June 2023. See note 4 for more information about the share incentive program and number of option granted.
The Board of Directors has been granted a mandate from the general meeting held on 28 April 2022 to increase the share capital with up to NOK 1,773,210 by subscription of new shares. The proxy is valid until the earlier of the annual general meeting in 2023 and 30 June 2023.
| Position | Employed since | 30 Jun 2022 | 30 Jun 2021 | |
|---|---|---|---|---|
| Martin Olin | Chief Executive Officer |
September 2022 | 37,100 | 0 |
| Total shares held by management | 37,100 | 0 |
| Position | Served since | 30 Jun 2022 | 30 Jun 2021 | |
|---|---|---|---|---|
| Anders Tullgren | Chairman | January 2022 | 50,000 | 0 |
| Sveinung Hole 1) | Board member | September 2010 | 107,394 | 107,394 |
| Total shares held by members of the Board of Directors | 157,394 | 107,394 |
1) Sveinung Hole holds 104,444 shares in the Company through Svev AS, a wholly owned company of Sveinung Hole, and 2,950 shares directly.
Pension
BerGenBio ASA is required to have an occupational pension scheme in accordance with the Norwegian law on required occupational pension ("lov om obligatorisk tjenestepensjon").
The Company has a pension scheme which complies with the Act on Mandatory company pensions.
| ACCORD | Accelerating COVID-19 Research & Development |
|---|---|
| AML | Acute Myeloid Leukaemia. |
| Anti-AXL MAb | Anti-AXL Monoclonal antibody. A monoclonal antibody that recognises AXL and binds to the AXL receptor blocking its function. |
| Antibody | Proteins produced by the B Lymphocytes of the immune system in response to foreign proteins called antigens. Antibodies function as markers, biding to the antigen so that the antigen molecule can be recognized and destroyed. |
| ASCO | American Society of Clinical Oncology |
| ASH | American Society of Hematology |
| AXL | Cell surface expressed receptor tyrosine kinase, being an essential mediator of the EMT programme. AXL is up-regulated in a variety of malignancies and associated with immune evasion, acquired drug resistance and correlates with poor clinical prognosis. |
| Anti-AXL MAb | AXL Monoclonal antibody. A monoclonal antibody that recognises AXL and binds to the AXL receptor. |
| Anti-PD-1 | Agent that is used to inhibit the PD-1 receptor |
| Bemcentinib | BerGenBio's lead drug candidate; a highly selective inhibitor of AXL currently undergoing Phase Ib/II clinical trials in a range of aggressive cancers. |
| Biomarkers | A measurable indicator of some biological state or condition. More specifically, a biomarker indicates a change in expression or state of a protein that correlates with the risk or progression of a disease, or with the susceptibility of the disease to a given treatment. |
| cAXL | Composite AXL |
| CDx | Companion diagnostics |
| Checkpoint inhibitors | The immune system depends on multiple checkpoints to avoid overactivation of the immune system on healthy cells. Tumour cells often take advantage of these checkpoints to escape detection by the immune system. Checkpoint inhibitors, inhibit these checkpoints by "releasing the brakes" on the immune system to enhance an anti-tumour T-cell response. |
| Clinical Research | The research phases involving human subjects. |
| Clinical Trials | Clinical Trials are conducted with human subjects to allow safety and efficiency data to be collected for health inventions (e.g., drugs, devices, therapy protocols). There trials can only take place once satisfactory information has been gathered on the quality of the non-clinical safety, and Health Authority/Ethics Committee approval is granted in the country where the trial is taking place. |
| CPI | Immune checkpoint inhibitor |
| CR | Complete response |
| CRi | Complete response with incomplete recovery of peripheral counts |
| CRO | Contract research organisation. |
| DCR | Disease control rate |
| Docetaxel | A clinically well-established anti-mitotic chemotherapy medication that works by interfering with cell division. |
| EHA | European Hematology Association |
| Epithelial state | A state of the cell where the cells are stationary, typically forming layers and tightly connected and well ordered. They lack mobility tending to serve their specific bodily function by being anchored in place. |
| EGFR inhibitors | Epidermal growth factor receptor inhibitors. EGFRs play an important role in controlling normal cell growth, apoptosis and other cellular functions, but mutations of EGFRs can lead to continual or abnormal activation of the receptors causing unregulated EGFR inhibitors are either tyrosine kinase inhibitors or monoclonal antibodies that slow down or stop cell growth. |
| EMT | Epithelial-mesenchymal transition, a cellular process that makes cancer cells evade the immune system, escape the tumour and acquire drug resistant properties. |
| EMT inhibitors | Compounds that inhibit AXL and other targets that in turn prevent the formation of aggressive cancer cells with stem-cell like properties. |
| 26 |
| ESMO | European Society for Medical Oncology |
|---|---|
| EU-SolidAct | The EU-SolidAct trial is part of EU-RESPONSE, a pan-European research project involved with rapid and coordinated investigation of new and repurposed medication to treat Covid-19 during the ongoing pandemic. EU-SolidAct is an Adaptive Platform Trial. |
| FDA | Food and Drug Administration |
| Glioblastoma | Is the most aggressive of the gliomas, a collection of tumours arising from glia or their precursors within the central nervous system. Gliomas are divided into four grades, grade 4 or glioblastoma multiforme (GBM) is the most aggressive of these and is the most common in humans. |
| HR-MDS | High Risk Myelodysplastic Syndromes |
| IHC | Immunohistochemistry |
| In vivo | Studies within living organisms. |
| In vitro | Studies in cells in a laboratory environment using test tubes, petri dishes etc. |
| MAb | Monoclonal antibodies. Monospecific antibodies that are made by identical immune cells that are all clones of a unique parent cell, in contrast to polyclonal antibodies which are antibodies obtained from the blood of an immunized animal and thus made by several different immune cells. |
| MDS | Myelodysplastic Syndrome |
| Mesenchymal state | A state of the cell where the cells have loose or no interactions, do not form layers and are less well ordered. They are mobile, can have invasive properties and have the potential to differentiate into more specialised cells with a specific function. |
| Mesenchymal cancer cells | Cancer cells in a mesenchymal state, meaning that they are aggressive with stem-cell like properties. |
| Metastatic cancers | A cancer that has spread from the part of the body where it started (the primary site) to other parts of the body. |
| Myeloid leukaemia | A type of leukaemia affecting myeloid tissue. Includes acute myeloid leukaemia (AML) and chronic myelogenous leukaemia. |
| NSCLC | Non-small cell lung cancer. |
| ORR | Overall response rate |
| PDAC | Pancreatic ductal adenocarcinoma is the most common type of pancreatic cancer and a notoriously lethal disease |
| PD-1 | Programmed death 1 |
| PD-L1 | Programmed death-ligand 1 |
| PFS | Progression-free survival |
| Phase I | The phase I clinical trials where the aim is to show that a new drug or treatment, which has proven to be safe for use in animals, may also be given safely to people. |
| Phase Ib | Phase Ib is a multiple ascending dose study to investigate the pharmacokinetics and pharmacodynamics of multiple doses of the drug candidate, looking at safety and tolerability. |
| Phase II | The phase II clinical trials where the goal is to provide more detailed information about the safety of the treatment and its effect. Phase II trials are performed on larger groups than in Phase I. |
| Phase III | In the phase III clinical trials data are gathered from large numbers of patients to find out whether the drug candidate is better and possibly has fewer side effects than the current standard treatment. |
| PR | Partial Response |
| Receptor tyrosine kinase | High-affinity cell surface receptors for many polypeptide growth factors, cytokines and hormones. Receptor tyrosine kinases have been shown not only to be key regulators of normal cellular processes but also to have a critical role in the development and progression of many types of cancer. |
| RECIST | Response Evaluation Criteria In Solid Tumors, a set of published rules that define when cancer patients improve ("respond"), stay the same ("stable") or worsen ("progression") during treatments. |
| R/R | Relapsed/Refractory |
| SARS-CoV-2 | Severe acute respiratory syndrome coronavirus 2 |
| sAXL | Soluble AXL |
| SITC | Society for Immunotherapy of Cancer |
| SoC | Standard of care |
| Small molecule | A small molecule is a low molecular weight (<900 Daltons) organic compound that may help regulate a biological process, with a size on the order of 10-9m. |
| Tilvestamab | Former BGB149, BerGenBio's AXL inhibitor antibody. |
| UKRI | UK Research and Innovation |
| WCLC | World Conference on Lung Cancer |
Jonas Lies vei 91, 5009 Bergen, Norway Telephone: + 47 53 50 15 64 E-mail: [email protected] Investor Relations [email protected]m
Graham Morrell Head of IR
Martin Olin CEO
Rune Skeie CFO
Joseph Pantginis Telephone: +1 646 975 6968 E-mail:[email protected]m
Ulrik Trattner Telephone: +46 8 5886 8589 E-mail: ulrik.trattner@carnegie.se
Lars Mørland Knudsen Telephone:+47 41 70 72 80 E-mail: [email protected]m
Telephone: +47 977 66 583 E-mail: geir.hiller.holom@dnb.no
Patrik Ling Telephone: +46 8 473 48 43 E-mail: patrik.ling@dnb.se
Pooya Hemami Telephone: +44 203 077 5700 [email protected]m Harry Shrives Telephone: +44 203 077 5700 [email protected]m
This Report contains certain forward-looking statements relating to the business, financial performance and/or results of the Company and/or the industry in which it operates. Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words "believes", expects", "predicts", "intends", "projects", "plans", "estimates", "aims", "foresees", "anticipates", "targets", and similar expressions. The forward-looking statements contained in this Report, including assumptions, opinions and views of the Company or cited from other sources are solely opinions and forecasts which are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. None of the Company or any of their parent or subsidiary undertakings or any such person's officers or employees provides any assurance that the assumptions underlying such forward-looking statements are free from errors nor do any of them accept any responsibility for the future accuracy of the opinions expressed in this Presentation or the actual occurrence of the forecasted developments. The Company assumes no obligation, except as required by law, to update any forward-looking statements or to conform these forward-looking statements to our actual results.
Telephone: + 47 535 01 564 E-mail: [email protected]
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