Dynavax Technologies Corporation (NASDAQ:DVAX) reported financial results for the fourth quarter and year ended December 31, 2016. The net loss for the year ended December 31, 2016 was $112.4 million, or $2.92 per share, compared to $106.8 million, or $3.25 per share, for the year ended December 31, 2015.
The Company had $81.4 million in cash, cash equivalents and marketable securities as of December 31, 2016, compared to $196.1 million at December 31, 2015. In addition, in the first quarter of 2017 the Company received proceeds of $23.3 million from sales of common stock under an at-the-market sales agreement.
“We are pleased with the continued progress of our immuno-oncology portfolio during 2016 and the recent promising clinical results from our combination trial in melanoma,” said Eddie Gray, chief executive officer for Dynavax. “With the expansion of SD-101 into Phase 2 in both melanoma and head and neck cancer this quarter, our marketing application for HEPLISAV-B under review by the FDA and our strong cash balance, we are in position to deliver key outcomes for several programs during 2017.”
During the last few years, the company has steadily advanced on its objective to evolve into an immuno-oncology company as it prepared for an anticipated launch of HEPLISAV-B™. Following receipt of the HEPLISAV-B Complete Response Letter (CRL) from the FDA in November 2016, the company was restructured to focus resources on the immuno-oncology portfolio and to enable HEPLISAV-B to advance through the FDA review process to an approval decision.
In early March, Dynavax presented promising clinical data from the dose escalation phase of an ongoing Phase 1b/2 study investigating SD-101 in combination with KEYTRUDA® (pembrolizumab), an anti-PD-1 therapy developed by Merck, known as MSD outside the United States and Canada, in patients with metastatic melanoma. Encouraging overall response rates and complete response rates in patients naïve to anti-PD-1 therapy were observed.
Based on the results of the initial dose escalation phase this trial is being expanded into Phase 2 studies in both melanoma and head and neck cancer. Patients will be enrolled in two cohorts, those naïve to anti-PD-1 treatment and patients who have progressive disease on anti-PD-1 therapy. The trial is designed to build on the encouraging results seen in the anti-PD-1 naïve patient group while allowing for continued dose escalation in patients who have progressive disease on anti-PD-1 therapies.
In February, Dynavax filed its responses to the November 2016 CRL issued by the FDA for HEPLISAV‐B, the company’s vaccine candidate intended for immunization against hepatitis B infection in adults 18 years of age and older. The FDA has established August 10, 2017 as the Prescription Drug User Fee Act (PDUFA) action date.
As part of the January restructuring, the company suspended manufacturing activities, commercial preparations and other longer term investment related to HEPLISAV-B during the regulatory review period and reduced its global workforce by approximately 40%. If the product is approved, Dynavax plans to satisfy anticipated initial demand from existing stockpiled inventory and to scale up commercial activities based on market demand and investment priorities.
Total revenues were $7.3 million for the fourth quarter of 2016 and $11.0 million for the full year of 2016 compared to $0.7 million and $4.1 million for the same periods in 2015. The increase was primarily due to recognition of $7.2 million under the research collaboration and license agreement with AstraZeneca related to the initiation of a Phase 2a clinical trial by AstraZeneca.
Research and development expenses were $18.4 million for the fourth quarter of 2016 and $84.5 million for the full year of 2016 compared to $20.9 million and $86.9 million for the same periods in 2015. This decrease was primarily due to a reduction in outside services expense associated with the completion of the HBV-23 clinical study in the fourth quarter of 2015, partially offset by an increase in headcount as well as regulatory and manufacturing activities in preparation for the anticipated commercial launch of HEPLISAV-B.
General and administrative expenses were $8.2 million for the fourth quarter of 2016 and $37.3 million for the full year of 2016 compared to $6.7 million and $22.2 million for the same periods in 2015. This increase was primarily due to costs related to preparation for the anticipated commercial launch of HEPLISAV-B including additional headcount, information technology systems and infrastructure to support commercial development as well as costs related to sourcing a debt financing commitment.
Shares of Dynavax closed last Friday at $5.90. DVAX has a 1-year high of $23.62 and a 1-year low of $3.20. The stock’s 50-day moving average is $4.53 and its 200-day moving average is $7.36.
On the ratings front, Dynavax has been the subject of a number of recent research reports. In a report issued on January 6, Cowen analyst Phil Nadeau reiterated a Buy rating on DVAX, with a price target of $45, which represents a potential upside of 663% from where the stock is currently trading. Separately, on November 15, William Blair’s Y Katherine Xu maintained a Buy rating on the stock and has a price target of $17.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Phil Nadeau and Y Katherine Xu have a yearly average return of 9.3% and 14.1% respectively. Nadeau has a success rate of 56% and is ranked #416 out of 4517 analysts, while Xu has a success rate of 52% and is ranked #562.
Dynavax Technologies Corp. is a clinical-stage biopharmaceutical company that uses toll-like receptor biology to discover and develop novel vaccines and therapeutics. The company’s development programs are organized under its three areas of focus: vaccine adjuvants, cancer immunotherapy, and autoimmune and inflammatory diseases. Its lead product candidate is HEPLISAV, a Phase III investigational adult hepatitis B vaccine. The company’s other products under pipeline are SD-101, DV1179 Autoimmune Disease and AZD1419 Asthma Therapy.