Interim Report January-March 2019

First quarter January – March 2019

  • Nets sales: TSEK 0 (0).
  • Other operating revenues TSEK 1,635 (50).
  • Profit from financial items: TSEK -2,471 (-1,999).
  • Earnings per share: SEK -0.05 (-0.12)
  • Liquidity as per the end of the reporting period: TSEK 28,228 (4,604)
  • Equity/assets ratio as per the end of the reporting period: 58.50 (84.90) %

Operations during the first quarter of 2019

  • During the first quarter CombiGene has presented the company on several occasions, among others, at the Stockholm Corporate Finance 11th Life Science Seminar and at Aktiedagen in Lund.
  • CombiGene has also received mention in periodicals including Sydsvenskan and BioStock.
  • World Epilepsy Day, 11 February, was observed with a lecture by one of CombiGene’s scientific founders, Professor Merab Kokaia, and his doctoral student, Esbjörn Melin.
  • The Spotlight Stock Market Disciplinary Committee deemed that CombiGene AB (publ) was in breach of its member rules and ordered the company to pay a fine corresponding to one year’s annual fee. The breach was due to the company’s misinterpretation of the Annual General Meeting’s approval of an issue, believing that it referred not only to shares, but also warrants. When the error was noted, the board acted immediately, calling an extraordinary meeting of shareholders, which also approved the issue of warrants. The company incurred no financial loss, as the cost was assumed by an advisor to the company.

Significant events after the end of the reporting period

  • CombiGene has submitted a public takeover bid to holders of shares and warrants of series TO1 in Panion Animal Health AB (publ).

A word from the CEO

The first quarter of 2019 involved continued intensive work with our candidate drug, CG01. The focus is now on process development and preparations for the very important toxicology and biodistribution studies. Among other things, this means that we are now approaching selection of the CMO (Contract Manufacturing Organisation) which will produce the GMP-classed (Good Manufacturing Practice) material for coming studies, and the CRO (Contract Research Organisation), which on our behalf will conduct the safety studies in animals which are necessary before clinical trials can begin. After the close of the quarter CombiGene submitted a public takeover bid to holders of shares and warrants of series TO1 in Panion Animal Health AB (publ). The purpose of the offer is to take advantage of the practical and financial synergies in our development processes and partnering.

Public takeover bid presented to holders of shares and warrants in Panion
I am very impressed by Panion’s development in recent years and I am convinced that the time for the transaction is optimal, given the potential for practical and financial synergies in our development processes and partnering.

When Panion was distributed to CombiGene’s shareholders in 2016 the motive was that a separate and dedicated veterinary medical company would be able to take the product to market faster. Since then, both CombiGene and Panion have gained considerable experience in the gene therapy field via their respective development programmes. This means that we foresee synergies and that the possibilities for success are considerably greater if the projects are managed under one company instead of two. I am also convinced that the proposed transaction will make the company even more attractive in the eyes of a strategic partner.

The most important synergies are in the wholly decisive areas of quality and regulatory issues. Acquisition of Panion will also give us coherent control over our intellectual property rights, which means a very great deal with respect to potential partners.

Since Panion’s shareholders are offered shares in CombiGene in exchange, the shareholders will benefit from all synergies resulting from the transaction. The bid will potentially result in greater long-term value for all shareholders.

CombiGene’s business development
CombiGene’s business development strategy is twofold. While we are actively seeking interesting new gene therapy projects that match CombiGene’s business, for several years we have also been working continuously to establish new contacts in the international pharma industry in order to pave the way for future collaboration. These discussions are ongoing, above all, at various types of conferences and congresses. We recently participated in the Cell & Gene Meeting on the Med conference in Barcelona, Spain, and later this spring CombiGene will take part in the 4th Biotech Hanse Forum in Stockholm and the BIO International Convention in Philadelphia.

During 2018 we identified several academic groups that are working with gene therapy solutions which, in the long term, could prove interesting for us. However, it is too soon to say with any certainty exactly when any possible collaboration will be initiated.

Jan Nilsson, CEO