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BPMX: Balance Sheet Boosted by Recent Financing

By Grant Zeng, CFA


Recently, BioPharmx reported its financial results for the quarter ended Jan 31, 2017. 

Total revenue for the fiscal fourth quarter ended January 31, 2017 was $15,000, as compared to $20,000 for the same period of last year. 

For the fourth quarter ended Jan. 31, 2017, total operating expenses were $4.3 million, compared with total operating expenses of $4.4 million in the prior year's fourth quarter.

Net loss for the fourth quarter was $5.2 million, or $0.09 per share, compared with a net loss of $4.6 million, or $0.19 per share, during the prior year quarter. 

Adjusted non-GAAP net loss for the fourth quarter ended Jan 31, 2017 was $4.4 million, or $0.08 per share. During the fourth quarter of the prior year, the comparable non-GAAP net loss was $4.2 million, or $0.18 per share.

Cash and cash equivalents as of Jan. 31, 2017, were $6.5 million.

In late April, 2017, BioPharmX closed a registered direct offering for the purchase and sale of 6,410,258 shares of common stock at a price of $0.78 per share with 50% warrant coverage (representing warrants to purchase up to 3,205,129 shares of common stock). The warrants will be exercisable at an exercise price of $0.90 per share beginning six months following the closing date and will expire five years from the date they become exercisable. The gross proceeds of the offering were approximately $5.0 million.  

Net proceeds of the offering will be used to advance the BioPharmX dermatology-focused drug delivery and clinical programs, including advancing the company's lead product BPX-01, and general corporate purposes.

The new financing immediately boosted the company’s balance sheet. Current cash in hand will provide funds sufficient to complete the company’s Phase IIb studies of BPX-01. 

Update on BPX-01 for Acne

BioPharmX is developing BPX01, a non-lipophilic, topical antibiotic for the treatment of acne. BPX01 utilizes a transepidermal delivery mechanism for minocycline and other APIs that has the potential to kill p. acnes bacteria without the systemic side effects of orally-administered antibiotics. 

Top Line Phase IIb Data Released   

Based on the positive Phase IIa data, on Aug. 24, 2016, BioPharmX announced that the first subject has been enrolled in its Phase IIb clinical trial assessing the efficacy and safety of BPX-01 for the treatment of acne vulgaris. The study is formally known as the OPAL (tOPicAL Minocycline Gel) study.

The 12-week, multi-center, double-blind, three-arm, vehicle controlled OPAL study expects to enroll 225 people, aged 9 to 40, who have moderate-to-severe inflammatory, non-nodular acne vulgaris. Safety will be assessed by physical examination, clinical laboratory tests, cutaneous tolerance scores and incidence of adverse events.

• The primary efficacy endpoint for the study is mean change from baseline in inflammatory lesion counts at Week 12. 
• The secondary efficacy endpoint is achievement of at least a two-grade reduction in Investigator Global Assessment (IGA) at Week 12 compared to baseline.

The principal investigator is Joely Kaufman, a board certified dermatologist at The Skin Research Institute in Miami and fellow of the American Academy of Dermatology.

In early January 2017, BioPharmX announced the on-time completion of enrollment in the OPAL. 
The company presented the data in May 2017. Here are the highlights for the Phase II data. 

No serious drug related adverse events were observed in the Phase IIb trial which were consistent with the results of Phase IIa. 

BPX-01 demonstrated statistically significant reduction in lesion count vs vehicle at both 1% and 2% concentration. Although not powered to determine statistical significance on IGA, BPX-01 at 2% showed clear numerical trend in IGA. Comprehensive data will be presented in June.

Phase III Study Planned in 3Q17

The company plans to use the Phase IIb data for the design and powering of Phase III trial. 

Biopharmx plans to hold an end of Phase II meeting with the FDA. With the input from the agency, the company plans to initiate the Phase III study in 3Q17. 

During the fourth quarter, the company also presented research at seven leading medical conferences suggesting that BPX-01 delivers both antibacterial and anti-inflammatory benefits in the treatment of acne. The presentations also reported novel imaging techniques, suggesting that BPX-01 effectively targets P.acnes in the skin without the systemic side effects of oral minocycline.

BPMX intends to pursue regulatory approval of BPX01 under Section 505(b)(2) of the FDC Act. The 505(b)(2) regulatory pathway may reduce the drug development risks and costs by using prior findings of safety and/or efficacy for an approved product. In BPX01 case, part of the safety and efficacy data from the oral formulation of minocycline may be used for the filing of a NDA for BPX01. 

If everything goes well, we estimate BPX01 will be approved by the FDA in calendar 2019. Peak sales of BPX01 should be around $450 million. 

New Feasibility Study of BPX-01 Was Initiated for Rosacea

Recently, Biopharmx initiated a 12-week feasibility study of BPX-01 for the treatment of rosacea.

This is an open-label study of BPX-01 in 20 patients with moderate to severe papulopustular rosacea. If the feasibility study is positive, the company plans to initiate a Phase II/III study in 3Q17. 

Rosacea is a common skin disease. It often begins with a tendency to blush or flush more easily than other people. The redness can slowly spread beyond the nose and cheeks to the forehead and chin. Even the ears, chest, and back can be red all the time. With time, people who have rosacea often see permanent redness in the center of their face. 


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