Abivax Reports H1 2024 Financial Results

Abivax, a clinical-stage biotechnology company based in Paris, France, has released its financial results for the first half of 2024. The company focuses on developing therapies that harness the body's regulatory mechanisms to manage chronic inflammatory diseases. As of June 30, 2024, Abivax reported a cash balance of EUR 222 million, which is expected to fund its operations into the fourth quarter of 2025.

The interim financial statements, approved by the Board of Directors on September 5, 2024, have been reviewed by external auditors. Abivax had previously announced updates on its business operations and key programs in press releases on July 15, 2024, and August 6, 2024.

For the first half of 2024, Abivax reported total operating income of EUR 6.8 million, a significant increase from EUR 2.3 million in the first half of 2023. This increase was primarily due to Research Tax Credit and Subsidies. However, total operating expenses also rose substantially to EUR 86.8 million, driven by increases in research and development (R&D), sales and marketing (S&M), and general and administrative (G&A) costs.

R&D expenses saw a notable increase of EUR 32.1 million, reaching EUR 64.7 million. This rise was largely due to the ongoing Phase 3 clinical trials for obefazimod in ulcerative colitis (UC), which generated an additional EUR 25.6 million in costs compared to Phase 2 trials. There were also EUR 0.9 million in expenses related to the Crohn's disease (CD) clinical program and a EUR 4.8 million increase in personnel expenses due to an expanded R&D team and new equity awards for officers and employees.

S&M expenses rose to EUR 4.2 million from EUR 0.2 million in the same period in 2023. These costs were mainly associated with consulting for market research to support future sales and commercialization efforts in the U.S. G&A expenses increased to EUR 17.9 million from EUR 6.8 million, driven by higher personnel costs due to increased headcount and new equity awards, as well as increased legal and professional fees related to operating as a dual-listed public company.

The net financial position of the company as of June 30, 2024, was EUR 120.4 million, down from EUR 203.2 million at the end of December 2023. Available cash and cash equivalents also decreased to EUR 222.3 million from EUR 251.9 million over the same period. The operating loss for the first half of 2024 increased to EUR 80 million, compared to EUR 37.3 million for the same period in 2023. The net loss for the period was EUR 81.6 million, compared to a net loss of EUR 52 million in the first half of 2023.

The company's financial performance was also impacted by a net financial loss of EUR 1.6 million, primarily due to interest expenses, non-cash expenses related to royalty certificates, amortization of prepaid expenses, and an increase in the fair value of warrant derivatives. These were partially offset by interest income from invested proceeds and foreign exchange gains.

Abivax's cash position was bolstered by net proceeds of EUR 48.5 million from the drawdown of tranches B and C of the Kreos/Claret financing. Each tranche consisted of EUR 25 million in senior secured non-convertible bonds. The company also agreed to repay EUR 2.4 million and EUR 0.2 million to Bpifrance following the termination of the RNP-VIR and Carena projects.

The company is in the process of terminating its liquidity contract with TRADITION SECURITIES AND FUTURE, effective September 30, 2024. Despite the financial challenges, Abivax remains optimistic about its ability to meet its operational cash flow requirements through the fourth quarter of 2025.

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