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AzurRx BioPharma Issues Letter to Shareholders
NEW
YORK, April 21, 2020 (GLOBE NEWSWIRE) -- AzurRx BioPharma, Inc.
(“AzurRx” or the “Company”) (NASDAQ: AZRX),
a company specializing in the development of non-systemic,
recombinant therapies for gastrointestinal diseases,
today issued the following letter to its shareholders and the
investment community from James Sapirstein, President and Chief
Executive Officer.
Dear
AzurRx Shareholders,
I hope
that all is well with you and your families during these difficult
and unprecedented times of the COVID-19 pandemic. When I last wrote
to you six months ago (on October 22, 2019), as the newly appointed
President and CEO of AzurRx, I spoke about my strong belief in the
potential of MS1819, our focus on building shareholder value and in
raising sufficient capital to achieve our milestones. I am pleased
to say we have made progress towards all of these goals. Let me now
provide a more detailed update on our progress and share with you
our goals for 2020 and 2021, including our plans to develop MS1819
into a Phase 3 ready asset that can potentially be
monetized.
Clinical Trials
OPTION 2 Trial
Despite
COVID-19, we currently anticipate only minor delays in initiating
and completing our dose-escalating Phase 2 OPTION 2 monotherapy
clinical trial, using 2.2g and 4.4g doses of MS1819 in enteric
capsules in the U.S. and Poland. During Q1 2020, we executed
contracts with our clinical research organizations (CROs) and began
preparation for the trial, including identifying the trial sites
and investigators. In addition, the clinical trial protocol has
been reviewed by the FDA with no comments, and we intend to begin
Institutional Review Board (IRB) reviews shortly. Barring any
significant coronavirus developments, we should be able to initiate
the OPTION 2 Trial by the end of Q2 2020 and expect top line data
in Q1 2021.
Combination Trial
In Q4
2019 we dosed the first patient in our Phase 2 combination therapy
clinical trial in Hungary. In January 2020 we reported that the
data from the first five patients in the study, for primary and
secondary efficacy endpoints, was positive and that there were no
safety issues. We are completing the trial in sites in Hungary and
plan to open new trial sites in Spain, and possibly in Turkey, in
Q3 2020. We plan to release interim data during Q3 2020, anticipate
completion of the Combination Trial by the end of 2020 and top line
data in Q1 2021.
Although
we are very pleased with our current clinical trial progress, the
impact of COVID-19 on clinical trials changes on a daily basis and
could in the future impact the progress of our trials. We intend to
provide updates if required as the COVID-19 pandemic continues to
develop.
Clinical Supply Chain (CMC)
Earlier
this month we signed a manufacturing agreement with Delpharm, a
leading contract development manufacturing organization (CDMO), for
the clinical drug supply of MS1819 for the OPTION 2 clinical trial
scheduled to initiate in Q2 2020. This marks the first time that
MS1819 will be manufactured with enteric capsules, which we believe
should prevent the MS1819 lipase from breaking down prior to
reaching the duodenum so that substantially more (~50%) drug
product can be released. Our supply chain remains intact and, as of
today, has not been impacted by COVID-19.
Relatedly,
COVID-19 highlights both the health risk of animal pathogens in
medicinal products and the risk of supply chain disruption, when
animals are either quarantined or culled. For example, in 2019 the
Chinese government ordered the culling of half of their pig
population following a swine flu epidemic. Chinese pigs are the
source of a majority of the world’s porcine pancreases used
in pancreatic enzyme replacement therapy (PERT) products. In
contrast, MS1819 is a synthetic recombinant yeast that can be
safely and reliably produced in fermenters under the strictest
quality control.
Personnel
We have
taken several steps to strengthen our team, broaden our talent pool
and consolidate and streamline our operations:
●
Finance: hiring Daniel Schneiderman as
our Chief Financial Officer and a new Controller;
●
Clinical Operations: consolidation of
all U.S.-European clinical trial programs under Jim Pennington,
M.D., our Chief Medical Officer;
●
Chemistry, Manufacturing & Controls
(CMC): hiring Ted Stover to serve as global Product
Development Manager for MS1819; and
●
Board of Directors: appointing Greg
Oakes, a seasoned biotech executive with significant experience and
a track record in pharma commercialization and
partnering.
Finance
We have
made considerable progress in strengthening our balance sheet,
realigning and reducing operating expenses and improving our
financial controls.
Capital Raised
In
November 2019, we entered into a purchase agreement for a $15
million equity line of credit with Lincoln Park Capital Fund, a
Chicago-based institutional investor and a long-standing investor
in AzurRx. This has provided us with access to sufficient capital
to move forward with our two Phase 2 clinical trials for
MS1819.
As a
follow up to the Lincoln Park equity line, in December 2019 and
January 2020, we closed a $6.9 million private placement consisting
of senior convertible promissory notes and warrants. The
convertible notes are convertible into common stock at $0.97 per
share, accrue interest at 9% per annum and mature on September 20,
2020. Many of our long-standing investors participated in this
round, and we greatly appreciate their continued support of
AzurRx.
With
these funds, we have been able to continue investing in our
clinical trials – by funding both the combination therapy
study in Europe and preparations for the upcoming OPTION 2
monotherapy study in the United States and Poland. Simultaneous to
our fundraising efforts, we also significantly reduced our
liabilities – by restructuring and paying off most of our
short-term obligations, including accounts payable and promissory
notes.
In
addition, in Q1 2020, we received an aggregate total of $1.77
million in non-dilutive funding from our French R&D tax credit
(CIR) for the years 2017 and 2018. We anticipate receiving our 2019
CIR towards the end of the year.
Finally,
in April 2020, we received a CARES Act Paycheck Protection Program
(PPP) loan of approximately $180,000 through the Small Business
Administration (SBA). This loan, which may be forgivable, will be
used to pay employees and other eligible expenses such as rent
during the COVID-19 crisis.
Financial Controls and Spend
Upon
joining AzurRx, one of my first objectives was to hire a new
financial team to both improve our financial controls and bring
them fully in-house. As mentioned above, in Q1 2020 we hired a new
CFO and Controller and they have rationalized our budgeting
process, introduced cost saving measures, and introduced the
appropriate controls across our U.S. and French
operations.
As part
of our strategic review, we made the decision to discontinue both
our AZX1103 beta-lactamase and MTAN pre-clinical programs in order
to fully concentrate our resources on the development of
MS1819.
As a
result of these efforts, we have been able to reduce our monthly
expenses, while continuing to advance our clinical programs for
MS1819. Our workforce has successfully transferred to a
work-at-home setting, and I would also like to emphasize that our
progress and clinical trial preparations are continuing even in the
current COVID-19 environment.
Looking Ahead
I would
like to reiterate my firm and continued belief in the potential for
MS1819 as we remain focused on building shareholder value and
executing upon our corporate objectives and milestones. We
believe that the successful completion and release of key efficacy
data from the Phase 2 monotherapy and combination therapy trials in
Q1 2021 represent inflection points that can increase the value of
AzurRx and provides the fundamental basis for developing MS1819
into a Phase 3 ready asset.
In
addition to executing on our clinical studies and releasing data,
we plan to spend 2020 and early 2021 focusing on the necessary CMC
and regulatory objectives needed to fully develop MS1819 for Phase
3 and commercialization. To that end, we are planning for a
new manufacturing campaign to optimize our long-term drug supply
chain and evaluate process improvements to further reduce
manufacturing costs. Additionally, this campaign will support the
toxicity studies needed to provide the clinical drug supply
necessary to initiate our Phase 3 trial. Finally, we will be
drafting a pediatric study plan to support a successful end of
Phase 2 meeting with the FDA.
I
believe achieving these clinical, CMC and regulatory milestones are
critical in order to maximize the value of AzurRx and reward the
patience and support of our investors and
stakeholders.
Once
again, I want to extend my personal thanks to all of you for your
support of AzurRx and my personal wish that you and your loved ones
stay healthy and safe.
Best
regards,
James
Sapirstein
President &
CEO
AzurRx BioPharma,
Inc.
About
AzurRx BioPharma, Inc.
AzurRx BioPharma, Inc. (NASDAQ:AZRX) is a biopharmaceutical company
engaged in the development of non-systemic biologics for the
treatment of patients with gastrointestinal disorders. The Company
is headquartered in New York, NY, with scientific operations based
in Langlade, France and clinical operations in Hayward,
California. Additional information on the Company can be
found at www.azurrx.com.
Forward-Looking Statements
This press release may contain certain statements relating to
future results which are forward-looking statements. These
statements are not historical facts, but instead represent only the
Company’s belief regarding future events, many of which, by
their nature, are inherently uncertain and outside of the
Company’s control. It is possible that the Company’s
actual results and financial condition may differ, possibly
materially, from the anticipated results and financial condition
indicated in these forward-looking statements. Additional
information concerning the Company and its business, including a
discussion of factors that could materially affect the
Company’s financial results, including those related to the
clinical development of MS1819 and the results of its clinical
trials, are contained in the Company’s Annual Report on Form
10-K for the year ended December 31, 2019 under the
heading “Risk Factors,” as well as the
Company’s subsequent filings with the Securities and Exchange
Commission. All forward-looking statements included in this press
release are made only as of the date of this press release, and we
do not undertake any obligation to publicly update or correct any
forward-looking statements to reflect events or circumstances that
subsequently occur or of which we hereafter become
aware.
For more information:
AzurRx BioPharma,
Inc.
760 Parkside
Avenue, Suite 304
Brooklyn, NY
11226
Phone:
(646)-699-7855
info@azurrx.com
Investor
Relations contact:
LifeSci
Advisors, LLC.
Hans Vitzthum,
Managing Director
1
International Place, Suite 1480
Boston,
MA 02110
Phone:
617-430-7578
hans@lifesciadvisors.com