Humanigen Completes Exchange of Loan Obligations for Equity
February 27, 2018
Company Transformation Continues, Focused on Making CAR-T Safer, Better, More Routine
Lenzilumab Nears Start of Clinical Testing to Prevent Critical CAR-T-related Neurotoxicity
BRISBANE, Calif., Feb. 27, 2018 (GLOBE NEWSWIRE) -- Humanigen, Inc. (OTCQB:HGEN), a biopharmaceutical company pursuing cutting-edge science to develop its proprietary monoclonal antibodies for immunotherapy and oncology treatments, today announced the completion of transactions with its lenders that extinguish 100 percent of the company’s $16.7 million of term loan obligations in exchange for common stock in the company.
In addition, Humanigen has received, as part of the transactions, a $3 million equity investment from an affiliate of lender Black Horse Capital.
With the transactions, Humanigen takes another important step in its continuing transformation into a biotechnology company at the vanguard of addressing significant and serious unmet needs with groundbreaking chimeric antigen receptor T-cell (CAR-T) therapy. Humanigen envisions developing a CAR platform, with lenzilumab as a potential answer for current CAR-T-related toxicities and ifabotuzumab as a potential CAR construct.
“Today marks a meaningful turning point for Humanigen as we focus on making CAR-T safer, better, and more routine,” said Cameron Durrant, MD, chairman and CEO of Humanigen. “The completion of these transactions provides $19.7 million of value to Humanigen. We can now focus our energy to continue to build a cutting-edge biotech and to execute upon the exciting recent science showing that our monoclonal antibodies can quickly play a potential role in improving CAR-T therapy and patients’ lives.”
Humanigen expects to start a phase Ib/II trial with lenzilumab for the prevention of CAR-T-related neurotoxicity in the second quarter of 2018. Lenzilumab is a specific, high-affinity and selective antagonist of circulating granulocyte-macrophage colony-stimulating factor (GM-CSF). GM-CSF is thought to be a potential key factor in triggering neurotoxicity, and perhaps other side effects, associated with CAR-T therapy.
By neutralizing circulating GM-CSF, and upon demonstrating effects on neurotoxicity without hampering the efficacy of CAR-T, lenzilumab has the potential to make CAR-T therapy:
safer by lessening neurotoxicity
more effective by allowing higher CAR-T doses, greater CAR-T expansion, and potentially reducing myeloid-derived suppressor cells (MDSC) that inhibit T cell function
a more routine out-patient procedure
Humanigen also is nearing full enrollment of its phase I lenzilumab study for the treatment of chronic myelomonocytic leukemia (CMML), a rare hematologic cancer, with interim data expected in the first half of 2018.
In addition, the company is exploring partnering opportunities to enable further development of ifabotuzumab as a potential treatment for certain solid and hematologic cancers, as an antibody-drug conjugate (ADC), as part of a bispecific antibody construct and as a CAR-T. An investigator-sponsored phase 0/1 radio-imaging trial of ifabotuzumab in glioblastoma multiforme, an aggressive and deadly form of brain cancer, is in progress and continues to recruit patients at the Olivia Newton-John Cancer Research Institute in Australia.
Under the terms of the transaction agreements previously announced on December 21, 2017, Humanigen issued 59,786,848 new shares of common stock to the lenders in exchange for the satisfaction and extinguishment of the company’s obligations with its outstanding secured term loans. The company also assigned certain assets and rights related to its former benznidazole drug candidate to a new entity formed and controlled by one of the lenders. Humanigen also issued 32,028,669 new shares of common stock to an affiliate of Black Horse Capital for $3 million of new funding, half of which was received on December 22, 2017, in the form of a secured loan that was converted into common stock at closing of the transactions.
The new shares issued to affiliates of Black Horse Capital, when combined with their previous ownership stakes, resulted in a change in control of the company, with Black Horse Capital and its affiliates owning more than 50 percent of the company’s outstanding shares of common stock. Shares outstanding before the transaction represent 14 percent of the new total outstanding shares.
Humanigen, Inc. is a biopharmaceutical company pursuing cutting-edge science to develop its proprietary monoclonal antibodies for immunotherapy and oncology treatments. Derived from the company’s Humaneered® platform, lenzilumab and ifabotuzumab are lead compounds in the portfolio of monoclonal antibodies with first-in-class mechanisms. Lenzilumab, which targets granulocyte-macrophage colony-stimulating factor (GM-CSF), is in development as a potential medicine to make chimeric antigen receptor T-cell (CAR-T) therapy safer and more effective, as well as a potential treatment for rare hematologic cancers such as chronic myelomonocytic leukemia (CMML) and juvenile myelomonocytic leukemia (JMML). Ifabotuzumab, which targets Ephrin type-A receptor 3 (EphA3), is being explored as a potential treatment for glioblastoma multiforme (GBM) and other deadly cancers, as well as a platform for creation of CAR-T and bispecific antibodies. For more information, visit www.humanigen.com.
This release contains forward-looking statements that are intended to be subject to protection afforded by the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect management's current knowledge, assumptions, judgment and expectations regarding future performance or events. Although management believes that the expectations reflected in such statements are reasonable, they give no assurance that such expectations will prove to be correct and you should be aware that actual events or results may differ materially from those contained in the forward-looking statements. Words such as "will," "expect," "intend," "plan," "potential," "possible," "goals," "accelerate," "continue," and similar expressions identify forward-looking statements, including, without limitation, statements regarding our expectations for executing on the key priorities and anticipated milestones described above in regard to phase Ib/II trial of lenzilumab for the prevention of neurotoxicity associated with CAR-T and phase I study as a potential treatment for CMML, and the investigator-sponsored phase 0/1 radio-labeled imaging trial of ifabotuzumab as a potential treatment of GBM. Forward-looking statements are subject to a number of risks and uncertainties including, but not limited to, the risks inherent in Black Horse Capital and its affiliates owning more than 50% of our outstanding common stock, including their ability to control the company; the effect on our stock price of the significant dilution that resulted from completion of the transactions described above; our lack of profitability and the need for additional capital to operate our business as a going concern; the uncertainties inherent in the development and launch of any new pharmaceutical product; the outcome of pending or future litigation; and the various risks and uncertainties described in the "Risk Factors" sections and elsewhere in the Company's periodic and other filings with the Securities and Exchange Commission.
All forward-looking statements are expressly qualified in their entirety by this cautionary notice. You should not place undue reliance on any forward-looking statements, which speak only as of the date of this release. We undertake no obligation to revise or update any forward-looking statements made in this press release to reflect events or circumstances after the date hereof or to reflect new information or the occurrence of unanticipated events, except as required by law.
Source: Humanigen, Inc.
Released February 27, 2018