Press Release

Molecular Partners reports its results for the Financial Year 2014 – A transformative year for the company

R&D and Business Highlights:

  • Positive Phase IIb data presented by Allergan for abicipar in wet AMD
  • Start of clinical testing of MP0250 in patients with advanced solid tumors
  • Janssen exercises option to develop multi-benefit DARPin in immunology
  • Industry leader Actavis, a growth pharma company with commitment to ophthalmology proposes to acquire Allergan; timely closing of transaction ex-pected
  • Dr. Andreas Harstrick joins Management Team as Chief Medical Officer
    Financial Highlights:
  • CHF 106.2 million raised in IPO on SIX Swiss Exchange (ticker: MOLN); 2nd largest Biotech IPO in Europe 2014; 1st Biotech IPO in Switzerland for 5 years
  • Strong financial results 2014, in line with guidance provided
  • CHF 1.8 million operating profit
  • CHF 188.4 million in cash and cash equivalents (+96%)
  • Strong balance sheet to fund company’s proprietary pipeline

Zurich-Schlieren, March 17, 2015. Molecular Partners AG (ticker: MOLN) announced to-day its results for the financial-year 2014. 2014 was a transformational year for Molecular Partners, marked by several developments that allowed the company to leverage the strengths of its novel DARPin technology platform, of its strategic partnerships as well as of its proprietary pipeline. The company completed its IPO in November 2014, representing the second largest Biotech IPO in Europe and the first successful Biotech IPO in Switzerland in five years. In 2014, the company successfully demonstrated potential patient benefit in a Phase II trial of abicipar and with MP0250 started the first systemic trial of any DARPin. The company gained clarity and stability in a key strategic partnership with Actavis’ acquisition proposal for Allergan and made progress in all other existing collaborations. Molecular Partners was able to further expand its team of highly motivated people: On employee, executive management as well as on Board level.

Summarizing the successful developments on product and partnership level in 2014, Molecular Partners CEO Christian Zahnd says: “Our broad pipeline across multiple indications, our powerful partnerships with bluechip pharma companies including Roche, Janssen and Allergan/Actavis, and our strong financial position combine to give us a uniquely robust position within the biotech sector.”


Strong partnerships and promising pipeline
In 2014, the company’s strategic partner Allergan initiated two clinical trials. In July, the first of these was a Phase II study of abicipar for the treatment of patients with diabetic macular edema (DME). Secondly, in August Allergan presented Phase IIb data in patients with wet age-related macular degeneration (AMD). Data showed that patients needed less frequent dosing of abicipar versus patients receiving standard treatment and also seemed to indicate that patients treated with abicipar achieved higher gains in vision clarity. Abicipar is expected to enter Phase III in the second quarter of 2015 for the treatment of wet AMD.

Consequently, a key event for Molecular Partners in 2014 was the November buyout proposal from Actavis to Allergan. Assuming the buyout is successful, Actavis, one of the fast-est-growing global pharmaceutical companies, and one that has publicly expressed its commitment to ophthalmology and its enthusiasm about the DARPin technology would become the company’s partner. As the potentially largest product candidate in the combined portfolio of Actavis / Allergan, abicipar remains well positioned for continued development, and Molecular Partners remains excited about the prospect of working with Actavis to bring this promising product to market.

In December, the company’s partner Janssen Biotech executed an option to secure exclusive rights to a multi-specific DARPin program. As compensation for the option exercise, Molecular Partners received a milestone payment of USD 2 million. The agreement allows for further license payments as well as development and sales milestones up to a maxi-mum of USD 200 million for this optioned product. Upon commercialization, Molecular Partners will be entitled to a tiered and up to double-digit royalty on worldwide net sales. Within this collaboration, Janssen has evaluated DARPins against several targets thought to be important for the treatment of inflammatory and autoimmune diseases.

In oncology, Molecular Partners initiated in July 2014 a Phase I trial of MP0250, the company’s most advanced oncology product candidate, in patients with solid tumors. Following years of clinical ophthalmology experience with DARPins administered locally to the eye, this is a key step towards the systemic use of DARPins. This underlines the potential of DARPins to be applied across multiple therapeutic areas.


Successful IPO in November 2014: 2nd largest Biotech IPO in Europe 2014
One of the most important developments in 2014 was the successful completion of the company’s initial public offering (IPO) on the SIX Swiss Exchange on November 4, 2014. In raising CHF 106.2 million gross proceeds (thereof CHF 104.1 million in primary gross proceeds), Molecular Partners was proud to successfully complete the second-largest biotech IPO in Europe of 2014 and the first biotech IPO in Switzerland in five years. Net proceeds from the primary offering in the IPO were CHF 93.8 million. As per year-end 2014, there were 19,640,450 shares outstanding with a nominal value of CHF 0.10 each. Per year-end 2014, the market capitalization of the company was CHF 494 million with a free float of 24.3%.

CFO Andreas Emmenegger on the successful IPO: “The IPO has enhanced our strengths and flexibility in the marketplace, will allow us to retain more and longer strategic owner-ship in the development of our product candidates in oncology and immuno-oncology and to enter into alliances retaining more control and ownership over programs compared to existing partnerships. Further, we are using the IPO proceeds to fund the continued development of our proprietary DARPin candidates, investments in research and discovery activities and for expanding our internal capabilities. We may also use the proceeds for the in-licensing or acquisition of complementary businesses and technologies, and general corporate purposes.”

Key figures 2014

Key Financials
(CHF million, except per share, FTE data) 
FY 2014 FY 2013 FY 2012 FY 2011
Total revenues 26.6 32.4 35.6 18.1
R&D expenses -19.8 -21.8 -18.2 -17.7
G&A expenses -5.0 -3.5 -3.0 -3.1
Operating profit (loss) 1.8 7.1 14.4 -2.7
Net profit (loss) -2.3 7.1 13.3 -0.7
Basic earnings/(loss) per share (in CHF) -0.15 4.83 8.91 -0.46
Net increase (decrease) in cash & cash equiv. 92.3 -17.1 49.0 28.9
Cash & cash equivalents at December 31 188.4 96.1 113.2 64.2
Total shareholders’ equity 148.5 48.3 41.8 31.8
Number of total FTE 74.1 72.7 57.6 44.4
– Number of FTE in R&D 67.2 66.8 52.1 39.0

Income statement: Development in line with expectations
In 2014, Molecular Partners recorded 18% lower revenues of CHF 26.6 million (2013:
CHF 32.4 million), of which CHF 16.6 million with Allergan, CHF 5.0 million with Janssen Biotech and CHF 5.0 million with Roche. A portion of CHF 17.7 million is related to technology access and transfer (from discovery alliances), CHF 8.6 million stem from R&D collaborations (deferred revenue recognitions from upfront payments as well as FTE pay-ments) and CHF 0.3 million are other revenues (cost recharges to partners).

Overall, total operating expenses were reduced by 2% to CHF 24.8 million (2013: CHF 25.3 million). These costs include CHF 2.6 million non-cash effective pension and share based compensation costs. The two major expense categories are personnel expenses with CHF 14.8 million (60% of total operating expenses) and research consumables and costs with CHF 5.6 million (23% of total operating expenses).

Total R&D expenses came back 9% to CHF 19.8 million (2013: CHF 21.8 million), mainly due to reduced external manufacturing costs for our proprietary oncology development assets as well as less royalty fees paid to the University of Zurich.

Total G&A expenses went up by CHF 1.5 million (+43%) to CHF 5.0 million (2013: CHF 3.5 million), mainly due to higher legal and personnel cost primarily driven by non-cash effective share based compensation costs.

As a result, Molecular Partners generated an operating profit of CHF 1.8 million in 2014 (2013: CHF 7.1 million).

In 2014, the company incurred a net financial expense of CHF 4.1 million (2013: net financial income of CHF 0.02 million) which is primarily due to the November 2014 IPO of the company. Total costs of the IPO amounted to CHF 10.3 million, of which CHF 3.2 million were recognized in equity and CHF 7.1 million were recognized under financial expenses. On the positive side, the company recorded a CHF 2.6 million currency gain on its USD cash position of USD 28.4 million held per year-end 2014.

Molecular Partners did not incur any income taxes in neither 2014, nor in 2013. Going forward and after the use of existing tax loss carry forwards, the company’s applicable income tax rate is expected to be around 21%.

On the net profit line, Molecular Partners generated in 2014 a net loss of CHF 2.3 million (2013: net profit of CHF 7.1 million) and basic earnings per share (EPS) came in at CHF -0.15 (2013: CHF 4.83). The reduction compared to the previous year is in line with management’s expectation and reflects reduced revenues, our increased R&D activities and one time IPO related expenses.

The number of FTEs has increased in 2014 to 74.1 FTE’s per end 2014 (thereof 67.2 FTEs were in R&D and 6.9 FTEs in G&A), gradually up from 72.7 FTEs per end 2013.

Balance sheet and cash position: Significantly reinforced through IPO
Total assets increased by 76% to CHF 194.0 million at year-end 2014 (2013: CHF 110.1 million), reflecting the significant increase in the cash balance to CHF 188.4 million (end of 2013: CHF 96.1 million) as a result of the IPO. Also as a result of the IPO, total share-holders’ equity more than tripled to CHF 148.5 million (2013: CHF 48.3 million). The company continued to be debt free at the end of 2014.

Cash flows: Driven by IPO proceeds
In 2014, Molecular Partners incurred a negative net cash flow from operations in the amount of CHF -11.3 million which is 17% less than the previous year (2013: CHF -13.6 million). Cash received from the partnerships went up substantial CHF 8.9 mil-lion (+86%) to CHF 19.2 million (2013: CHF 10.3 million). Driven by the proceeds from the IPO, the company generated a net cash inflow from financing activities in the amount of CHF 101.2 million (2013: CHF -2.0 million). Overall, this resulted in a net cash increase of CHF 92.3 million in 2014 (2013: CHF -17.1 million).

Dr. Andreas Harstrick appointed Chief Medical Officer (CMO)
Molecular Partners today announced the appointment of Dr. Andreas Harstrick as its Chief Medical Officer (CMO) and new member of the Executive Management per May 1, 2015. Dr. Andreas Harstrick brings 28 years of experience in Oncology to the company. He has a track record of designing clinical trials leading to approval of antibody drugs, including Erbitux (cetuximab targeting EGFR) and Cyramza (ramucirumab targeting VEGFR2). Further, he has in-depth experience in setting-up clinical oncology teams and he has held several senior executives roles at leading international companies.

Dr. Andreas Harstrick has worked for Imclone Systems, Branchburg NJ, where since 2012 he held the position as SVP Medical Sciences and was a member of the Lilly Oncology Pro-gram Review Board and Lilly Oncology Business Development Committee. Before that, Andreas held the position as SVP Clinical Operations, Data Sciences and Medical Communications at Imclone. Prior to moving to the US, he was VP Clinical Development at Imclone International and SVP Global Clinical Development Unit Oncology at Merck Serono, both in Germany.

Board reinforced through appointment of Steven H. Holtzman
In September 2014, Steven H. Holtzman joined the board of directors of Molecular Partners. Steven H. Holtzman is currently Executive Vice President Corporate Development of Biogen Idec. With his proven background in building and managing successful biotech companies such as Infinity Pharmaceuticals and Millennium Pharmaceuticals, he is a powerful addition to the board of Molecular Partners, reinforcing the company’s ability to develop broad clinical and preclinical pipeline through key partnerships.

CEO duties temporarily assigned to COO and Chairman
On March 10, 2015, Molecular Partners announced that its CEO Christian Zahnd will temporarily be absent from the company due to a medical treatment. The Board of Directors wishes Christian Zahnd an early and full recovery and has assigned the CEO duties temporarily to Patrick Amstutz, COO, and Jörn Aldag, Chairman of the Board.

Business outlook and priorities
In 2015, Molecular Partners expects to advance significantly across ophthalmology, oncology and immunology. Working with its expert partners as well as independently, the company will continue the development of its existing assets and invest in further DARPin discovery and development.

One of the company’s near-term priorities is to advance its ophthalmology pipeline through the partnership with Actavis. Molecular Partners is focused on progressing abicipar through Phase III trials to commercial launch and continuing with the ongoing Phase II trial in DME. The company looks forward to advancing its multi-VEGF/PDGF DARPin through preclinical development.

The company is also advancing the development of its proprietary oncology pipeline by establishing proof of concept for treatments with unmet medical need and by determining the most attractive route to maximizing the value of a given product candidate. Molecular Partners aims to complete Phase I development of MP0250, for which topline safety and initial efficacy data in solid tumors are expected in 2015, and to progress MP0274 from preclinical to clinical development in 2016.

The company’s immuno-oncology pipeline is another key priority with the aim of developing a portfolio of proprietary, non-partnered product candidates in an area of high unmet medical need. The management team is convinced that the DARPin platform holds the key to unlocking breakthrough therapies in this category.

Finally, in 2015 the company will benefit from its existing industry partnerships by leveraging the partners’ strong scientific, development, regulatory and commercial capabilities. In turn the partners gain access to Molecular Partners biologics expertise and know-how in DARPin discovery, optimization and development. A key focus remains on advancing the partnered oncology and immunology assets with Roche and Janssen, respectively. Molecular Partner’s partnering strategy remains to selectively enter into new alliances that in-tend to maximize value of its product candidates or contribute complementary technology or capabilities to the company.

Financial Outlook 2015
In 2015, operating expenses are expected to increase, particularly as the company continues the development of its proprietary product candidates, expands its proprietary product pipeline and invests in the DARPin technology. Furthermore, operating as a public company, hiring additional personnel and, potentially, expanding existing facilities will generate additional costs.

For the full year 2015, at constant exchange rates vs year end 2014, the Company expects a gross cash burn of CHF 35-40 million in 2015. However, this amount is subject to the timing of enrollment of patients in clinical trials and of other research and development activities. In addition, the company will incur non-cash effective costs for share based payments as well as for the pension accounting as per IFRS standards.

The net cash burn will depend on the cash collections from the company’s partners. Under the current development plans, management expects non-cash effective revenues in the amount of approximately CHF 18 million.

Molecular Partners is well funded and in a strong position to advance its proprietary oncology, immuno-oncology and partner pipeline. To account for a growing number of clinical trials run by the company, it will continue to strengthen its internal team by hiring experienced and talented experts such as the new Chief Medical Officer announced today.

Patrick Amstutz, COO, concludes: “These steps will help us to establish our late-stage clinical pipeline and to stay true to our mission of advancing modern medicine and significantly improving health.”

Financial Calendar

Annual General Meeting of Molecular Partners AG 06 May 2015
Publication of half-year results 2015 02 September 2015

Investor documentation:
Detailed information on the 2014 full-year results of Molecular Partners AG is available on

Audio webcast of the results presentation at 2:00pm CET, 17 March 2015:
The audio webcast will be accessible, both live and as a replay, on, along with the accompanying presentation slides.
For the live event, users will need to register prior to the event.

About Molecular Partners AG
Molecular Partners is a clinical-stage biopharmaceutical company that is developing a new powerful class of therapies known as DARPins™. DARPins™  are potent, specific and versatile small protein thera-pies which have the potential to offer benefits over conventional monoclonal antibodies or other current-ly available protein therapeutics. The DARPin technology has the potential to enable a “multibenefit” approach to treatment which enables DARPins to target multiple pathways, or multiple epitopes on a single target to achieve substantial patient benefit. DARPinsâ„¢ have the potential to advance modern medicine and significantly improve the treatment of serious diseases, including cancer and sight-threatening disorders.

Molecular Partners has four compounds in various stages of clinical and preclinical development and several more in the research stage, with a current focus on ophthalmology and oncology. Its most advanced product candidate is abicipar pegol, for which the company’s partner Allergan plans to initiate a Phase III clinical trial in wet AMD in 2015. The company has ongoing research and development partner-ships with leading pharmaceutical companies including Allergan, Roche and Janssen and is backed by established biotech investors.

For further details, please contact
Rolf Schläpfer
+41 (0)43 344 4242

Dr. Christian Zahnd, CEO
Dr. Patrick Amstutz, COO
Tel: +41 (0) 44 755 77 00

Legal Notice
This announcement is not an offer to sell, or a solicitation of an offer to purchase, any securities of Molecular Partners AG (the “Company”), nor shall it or any part of it form the basis of, or be relied on in connection with any contract or investment decision. This announcement is not for publication or distribution (directly or indirectly) in or to the United States, Canada, Australia, Japan or any other jurisdiction in which such distribution would be unlawful.

This announcement contains statements that are, or may be deemed to be, forward-looking statements. In some case, these forward-looking statements can be identified by the use of forward-looking terminology or subjective assessments, including the words“potential”, “expects”, “targets”, “designed”, “intends” or “plans”or comparable terminology or by discussions of plans, objectives, targets, goals, future events or intentions. These forward-looking statements include matters that are not historical facts or which may not otherwise be provable by reference to past events, and are based on assumptions. By their nature, forward-looking statements are subject to known and unknown risks and uncertainties because they relate to events and/or depend on circumstances that may or may not occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these statements and forecasts. Past performance of the Company cannot be relied on as a guide to future performance.

The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice. Neither the Company nor any other person undertakes any obligation to review, update, confirm, or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this announcement.