Elanco Announces Agreement to Acquire Kindred Biosciences

Bolt-on Acquisition Accelerates Elanco’s Expansion in Pet Health

Elanco to host conference call for investment community at 8:00 am Eastern Time  

  • Elanco will acquire all outstanding stock of Kindred Biosciences at a price of $9.25 per share, or approximately $440 million, a premium of 52% based on the 30-day average.
  • Transaction brings three potential blockbusters in the development phase, complements existing pipeline, and augments monoclonal antibody R&D capabilities.
  • Increasing Investor Day revenue from innovation expectation by $100 million, to $600 million to $700 million by 2025, with significant opportunity beyond the period.
  • Differentiated, disruptive portfolio in atopic dermatitis and other chronic unmet needs expected to unlock upside to Elanco’s long-term growth algorithm, with the potential to add a full percentage point of consistent annual revenue growth, starting in 2024, and expand the company’s margin over time.
  • Transaction and operating costs slightly dilutive to Elanco’s reported and adjusted earnings per share in 2021 and 2022; net leverage goal below 3x extended three months to the end of the first quarter of 2024.

GREENFIELD, Ind. and SAN FRANCISCO (June 16, 2021) – Elanco Animal Health Incorporated (NYSE: ELAN) and Kindred Biosciences, Inc. (KindredBio, NASDAQ: KIN) today announced the parties have entered into a definitive agreement for Elanco to acquire KindredBio, a biopharmaceutical company focused on developing novel pet therapeutics based on validated human targets. The acquisition further accelerates Elanco’s expansion in the attractive pet health market, particularly advancing Elanco’s presence in the fast-growing billion-dollar dermatology category.

KindredBio brings three potential dermatology blockbusters expected to launch through 2025, as well as a number of additional R&D programs for other chronic disorders and unmet needs, including canine parvovirus. KindredBio’s innovative pipeline – added to Elanco’s own organic efforts – meaningfully augments Elanco’s ability to launch products, gain share, and grow in the dermatology market through fully accretive revenue dollars. Elanco anticipates the combination will add approximately $100 million to its previously stated innovation revenue expectation of $500 million to $600 million by 2025, with significant opportunity beyond the period.

“This highly complementary combination is focused in one of the most exciting spaces in pet health, and one where we see a strategic imperative to build a differentiated competitive offering,” said Jeff Simmons, president and CEO of Elanco. “It further accelerates our mix shift into pet health and advances our IPP strategy. Ultimately, we believe the combination positions Elanco to bring innovative solutions to veterinarians and pet owners in areas of unmet or under-served medical needs, fueling continued growth in the exciting pet therapeutic category and creating sustainable long-term value for shareholders.” 

The acquisition agreement builds on Elanco’s existing relationship with KindredBio, which began with licensing the global commercial rights of KindredBio’s late-stage treatment for canine parvovirus, and continues Elanco’s proven approach as an innovation partner of choice.

“From the beginning, we have been focused at KindredBio on bringing the best medicines to our animal family members. With this transaction with Elanco, a widely respected leader in veterinary medicine with global reach, we will maximize the impact our innovative pipeline will have on improving the lives of pets,” said Richard Chin, CEO and co-founder of KindredBio.

“This announcement is validation of KindredBio’s achievements as one of the world’s first veterinary biopharmaceutical companies, recognizing our track record in drug development and remarkably talented team,” added Denise Bevers, Board director and co-founder of KindredBio. “KindredBio looks forward to continuing our mission to transform veterinary medicine as part of the Elanco family.”

The deal will expand Elanco’s omnichannel leadership complementing the company’s e-commerce and retail position by increasing its veterinary clinic presence in a leading therapeutic category and keeping the veterinarian at the center. This continues Elanco’s work to be a conduit for pet owners to the veterinarian. Dermatologic symptoms such as scratching and allergies are the number one reason pet owners visit the veterinarian today.

Transaction Details

Under the terms of the agreement, Elanco will acquire all outstanding stock of Kindred Biosciences at a price of $9.25 per share, or approximately $440 million, a premium of 52% based on the 30-day average. Elanco intends to fund the acquisition with pre-payable debt.  Elanco expects to extend its leverage objective of under three times net leverage to Adjusted EBITDA by three months, from the end of 2023 to the end of the first quarter of 2024.

Elanco expects to unlock upside to its long-term growth algorithm, with the potential to add a full percentage point of consistent annual revenue growth, starting in 2024, and further expand the company’s margin potential over time. Transaction and operating costs will be slightly dilutive to Elanco’s reported and adjusted earnings per share in 2021, with the impact expected to be concentrated in the fourth quarter, and also slightly dilutive to the full year 2022.

“Kindred Biosciences’ monoclonal antibody pipeline and capabilities are additive and complementary to what we’ve built within Elanco,” said Aaron Schacht, executive vice president Innovation, Regulatory and Business Development at Elanco. “This combination will bolster our opportunity for leadership in atopic dermatitis and allow us to deliver innovation of novel biologic therapeutics to treat other unmet disease challenges in pets.”

Elanco expects the transaction to close in the third quarter of 2021, subject to customary closing conditions, including approval by KindredBio’s shareholders and clearance under the Hart-Scott-Rodino Antitrust Improvements Act. KindredBio’s Board approved the proposed acquisition.

Elanco also reaffirmed second quarter 2021 revenue guidance of $1,225 million to $1,255 million, and full year 2021 revenue guidance of $4,670 million to $4,710 million.

Goldman Sachs is acting as financial advisors to Elanco and Covington & Burling LLP is acting as legal counsel. Barclays is acting as financial advisor to KindredBio and Morrison & Foerster LLP is acting as legal counsel.

Conference Call and Webcast

Elanco will host a conference call for the investment community today at 8:00 am Eastern Time to discuss the announcement. Investors, media and general public can access a live webcast of the conference call through the link posted on Elanco’s website at https://investor.elanco.com/events-and-presentations/default.aspx. A replay will also be available on the website shortly following the call.

About Elanco

Elanco Animal Health Incorporated (NYSE: ELAN) is a global leader in animal health dedicated to innovating and delivering products and services to prevent and treat disease in farm animals and pets, creating value for farmers, pet owners, veterinarians, stakeholders, and society as a whole. With nearly 70 years of animal health heritage, we are committed to helping our customers improve the health of animals in their care, while also making a meaningful impact on our local and global communities. At Elanco, we are driven by our vision of Food and Companionship Enriching Life and our Elanco Healthy Purpose™ Sustainability Pledges –all to advance the health of animals, people, and the planet. Learn more at elanco.com.

About Kindred Biosciences

Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The Company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Important Information for Investors and Stockholders

This communication does not constitute a solicitation of any vote or approval in connection with the proposed acquisition of Kindred Biosciences, Inc. (“KindredBio”) by Elanco Animal Health Incorporated (“Elanco” and such proposed acquisition, the “Merger”). KindredBio intends to file with the SEC and mail to its stockholders a definitive proxy statement in connection with the proposed Merger. BEFORE MAKING ANY VOTING DECISION, KINDREDBIO’S STOCKHOLDERS ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THE PROXY STATEMENT (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT KINDREDBIO AND THE PROPOSED MERGER. The proposals for the Merger will be made solely through the proxy statement. Investors and stockholders may obtain copies of the proxy statement and other documents filed with the SEC by KindredBio (when they became available) free of charge from the SEC’s website at www.sec.gov or by accessing KindredBio’s website at www.kindredbio.com. In addition, a copy of the proxy statement (when it becomes available) may be obtained free of charge from Investor Relations at Kindred Biosciences, Inc., 1555 Bayshore Highway, Suite 200, Burlingame, CA 94010.  Copies of the documents filed with the SEC by Elanco (when they become available) may be obtained free of charge from the SEC’s website at www.sec.gov or by accessing Elanco’s website at www.elanco.com.

Participants in the Merger Solicitation

Elanco, KindredBio, and certain of their directors, executive officers and employees may be considered participants in the solicitation of proxies from KindredBio’s stockholders with respect to the proposed transactions. Information regarding the persons who may, under the SEC rules, be deemed participants in the solicitation of KindredBio’s stockholders in connection with the proposed Merger and a description of their direct and indirect interests therein, by security holdings or otherwise, will be set forth in the definitive proxy statement that KindredBio intends to file with the SEC when it becomes available. Information about Elanco’s directors and executive officers is set forth in Elanco’s definitive proxy statement for its 2021 Annual Meeting of Shareholders, which was filed with the SEC on March 25, 2021. Information about KindredBio’s directors and executive officers is set forth in KindredBio’s definitive proxy statement for its 2021 Annual Meeting of Stockholders, which was filed with the SEC on April 29, 2021. These documents may be obtained as indicated above.

Cautionary Statement Regarding Forward-Looking Statements

Statements included in this press release that are not a description of historical facts are forward-looking statements. Words or phrases such as “believe,” “may,” “could,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “seek,” “plan,” “expect,” “should,” “would” or similar expressions are intended to identify forward-looking statements, and are based on our current beliefs and expectations. These forward-looking statements include, without limitation, statements regarding the proposed acquisition of KindredBio, the expected timetable for completing the transaction, future financial and operating results, benefits and synergies of the transaction, future opportunities for the combined businesses and any other statements regarding events or developments that Elanco believes or anticipates will or may occur in the future. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. There are a number of important factors that could cause actual events to differ materially from those suggested or indicated by such forward-looking statements. These factors include risks and uncertainties related to, among other things: uncertainties as to the timing of the Merger; the possibility that competing acquisition proposals will be made; the inability to complete the Merger due to the failure to obtain KindredBio’s stockholder adoption of the Merger Agreement or the failure to satisfy other conditions to completion of the Merger, including required regulatory approvals; the failure of the transaction to close for any other reason; the effects of disruption caused by the transaction making it more difficult to maintain relationships with employees, collaborators, customers, vendors and other business partners; the risk that stockholder litigation in connection with the Merger may result in significant costs of defense, indemnification and liability; diversion of management’s attention from ongoing business concerns and other risks and uncertainties that may affect future results of the combined company, including the risks described in the section entitled “Risk Factors” in Elanco’s and KindredBio’s Annual Reports on Form 10-K for the year ended December 31, 2020 and Quarterly Reports on Form 10-Q for the quarter ended March 31, 2021. All forward-looking statements are qualified in their entirety by this cautionary statement and neither Elanco nor KindredBio undertake any obligation to revise or update this press release to reflect events or circumstances after the date hereof, except as required by law.

KindredBio Contact: Katja Buhrer, 917-969-3438, katja.buhrer@kindredbio.com
Elanco Investor Contact: Tiffany Kanaga, 302-897-0668, tiffany.kanaga@elancoah.com 
Elanco Media Contact: Colleen Parr Dekker, 317-989-7011, colleen.dekker@elancoah.com 

Kindred Biosciences Announces Positive Results from Pivotal Efficacy Study of Parvovirus Monoclonal Antibody for the Prevention of Deaths in Dogs Infected by Parvovirus

  • Study demonstrated 100% survival in dogs treated with KIND-030, even in the absence of any supportive care, versus 43% survival in dogs treated with placebo

San Francisco, California (June 2, 2021) – Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, today announced positive results from a pivotal efficacy study of KIND-030 in dogs infected by parvovirus. The primary endpoint was survival and the results showed 100% survival in the treated group versus 43% survival in the placebo group.

KIND-030, a monoclonal antibody targeting canine parvovirus (CPV), is partnered with Elanco Animal Health (NYSE: ELAN).

In this randomized, blinded, placebo-controlled study, KIND-030 was administered to dogs after they tested positive for CPV infection. The primary endpoint of the study was met. The parvovirus challenge resulted in 57% mortality rate in the control dogs compared to 0% mortality rate in the KIND-030 treated dogs. The dogs did not receive any supportive care or other treatments.

“Parvovirus is a devastating disease currently without any available treatment,” said KindredBio’s Chief Executive Officer, Richard Chin, M.D. “With 100% efficacy, we believe KIND-030 has the potential to revolutionize the care of these dogs. Instead of a lengthy and expensive hospitalization that is frequently ineffective and can leave the dog with permanent disabilities, the infected dogs can now be treated with a single injection without need for additional supportive care or hospitalization.”

“We are excited to partner with KindredBio on this revolutionary treatment that can significantly improve the health and well-being of dogs,” said Jeff Simmons, president and CEO of Elanco Animal Health. “With our significant global reach and access to veterinarians and pet owners around the world, Elanco looks forward to leveraging our capabilities and skilled team of experts to advance and commercialize this novel treatment for pets globally.”

With this positive study, KIND-030 has now demonstrated efficacy in both indications being pursued: prophylactic therapy to prevent clinical signs of canine parvovirus infection, and treatment of established parvovirus infection. Results from the pivotal efficacy study for the therapeutic claim are expected to be submitted to the United States Department of Agriculture (USDA) in June, with possible approval by year-end 2021.

CPV is the most significant and contagious viral cause of enteritis in dogs, especially puppies, with mortality rates as high as 91% if untreated. There are currently no Food and Drug Administration or USDA approved treatments for CPV, nor any other available treatment. Veterinary intervention is limited to supportive care, which can cost owners up to thousands of dollars per puppy, with an average cost of $1,200.

Canine parvovirus is most often seen in puppies less than 6 months of age, but can occur in unvaccinated dogs of any age. Clinical signs often include depression, not eating, vomiting, and profuse diarrhea which is often blood tinged[1]. Banfield estimates that there are approximately 250,000 parvo cases in the U.S. each year, excluding emergency hospitals, shelters, specialty hospitals, or undiagnosed cases[2]

KIND-030 binds to critical portions of the virus, preventing the virus from entering into cells.

On April 28, 2021 KindredBio announced acceptance of the parvovirus antibody prophylaxis study data and approval of the efficacy indication by the USDA Center for Veterinary Biologics. The pivotal efficacy data for the prophylactic indication demonstrated that 0% of the KIND-030 treated dogs developed parvovirus infection while 100% of the placebo-control dogs developed the disease, and also showed 100% survival rate in KIND-030.

Regulatory approval and review timeline are subject to the typical risks inherent in such a process. The results of the pivotal efficacy study for the therapeutic claim stated in this press release have not been reviewed by the USDA Center for Veterinary Biologics.

About Kindred Biosciences

Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The Company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Forward-Looking Statements 

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, but not limited to, statements regarding our expectations about the trials, regulatory approval, manufacturing, distribution and commercialization of our current and future product candidates, and statements regarding our anticipated revenues, expenses, margins, profits and use of cash.

These forward-looking statements are based on our current expectations. These statements are not promises or guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results to be materially different from any future results expressed or implied by the forward-looking statements. These risks include, but are not limited to, the following: our limited operating history and expectations of losses for the foreseeable future; the absence of significant revenue from our products and our product candidates for the foreseeable future; the likelihood that our revenue will vary from quarter to quarter; our potential inability to obtain any necessary additional financing; our substantial dependence on the success of our products and our lead product candidates which may not be successfully commercialized even if they are approved for marketing; the effect of competition; our potential inability to obtain regulatory approval for our existing or future product candidates; our dependence on third parties to conduct some of our development activities; our dependence upon third-party manufacturers for supplies related to  our products and our product candidates and the potential inability of these manufacturers to deliver a sufficient  amount of supplies on a timely basis; the uncertain effect of the COVID-19 pandemic on our business, results of operations and financial condition; uncertainties regarding the outcomes of trials regarding our product candidates; our potential failure to attract and retain senior management and key scientific personnel; uncertainty about our ability to enter into satisfactory agreements with third-party licensees of our biologic products and uncertainty about the amount of revenue that we will receive from such agreements; our significant costs of operating as a public company; potential cyber-attacks on our information technology systems or on our third-party providers’ information technology systems, which could disrupt our operations; our potential inability to repay the secured indebtedness that we have incurred from third-party lenders, and the restrictions on our business activities that are contained in our loan agreement with these lenders; the risk that our 2020 strategic realignment and restructuring plans will result in unanticipated costs or revenue shortfalls; uncertainty about the amount of royalties that we will receive from the sale of Mirataz® to Dechra Pharmaceuticals PLC; the risk that the revenue from our delivery of services or products under any contract may be less than we anticipate if the other party to the contract exercises its right to terminate the contract prior to the completion of the contract or if such party is unable or unwilling to satisfy its payment obligations under the contract; our potential inability to obtain and maintain patent protection and other intellectual property protection for our products and our product candidates; potential claims by third parties alleging our infringement of their patents and other intellectual property rights; our potential failure to comply with regulatory requirements, which are subject to change on an ongoing basis; the potential volatility of our stock price; and the significant control over our business by our principal stockholders and management. 

For a further description of these risks and other risks that we face, please see the risk factors described in our filings with the U.S. Securities and Exchange Commission (the SEC), including the risk factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K and any subsequent updates that may be contained in our Quarterly Reports on Form 10-Q filed with the SEC. As a result of the risks described above and in our filings with the SEC, actual results may differ materially from those indicated by the forward-looking statements made in this press release. Forward-looking statements contained in this press release speak only as of the date of this press release and we undertake no obligation to update or revise these statements, except as may be required by law.

Contacts

For investor inquiries: 
Katja Buhrer
Katja.buhrer@kindredbio.com 
(917) 969-3438

[1] American Kennel Club Canine Health Foundation. Canine Parvovirus Information for Dog Owners. June 2018. Available from: http://www.akcchf.org/canine-health/top-health-concerns/current-topics-in-infectious-disease/AKC-CHF-Canine-Parvovirus-Fact-Sheet.pdf [Access Date: Sept. 14, 2020].

[2] 2014 Banfield State of Pet Health report compiled from the medical data of 2.3 million dogs treated at Banfield Pet Hospitals 2013.

Kindred Biosciences to Present at Stifel 2021 Virtual Jaws & Paws Conference and LD Micro Invitational XI

SAN FRANCISCO, May 25, 2021 — Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, will present at the Stifel 2021 Virtual Jaws & Paws Conference on June 2 and the LD Micro Invitational XI on June 8.   

Dr. Richard Chin, Chief Executive Officer, will be available for one-on-one meetings. During this time, investors will have the opportunity to discuss recent developments, study results from key therapeutic programs in development, and upcoming milestones.

Conference Details:

Stifel 2021 Virtual Jaws & Paws Conference
Date: June 2, 2021
Presentation time: 11:00–11:25a.m. ET
Webcast URL: Click here

LD Micro Invitational XI
Date: June 8, 2021
Presentation time: 1:30–1:55p.m. ET
Register to watch the presentation: Click here

An archived version of the above webcast will be available for 30 days on the KindredBio website.

About Kindred Biosciences 
Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The Company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Contact
Katja Buhrer 
katja.buhrer@kindredbio.com 
(917) 969-3438

Kindred Biosciences Announces First Quarter 2021 Financial Results

San Francisco, California (May 11, 2021) – Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, today announced financial results for the first quarter ended March 31, 2021 and provided updates on its programs. For the first quarter 2021, KindredBio reported net revenues of $2.4 million and a net loss of $9.7 million, or $0.24 per share.

“We had a strong start to the year, announcing positive results in a new long-acting interleukin-31 antibody program that has the potential to become a best-in-class therapeutic, alongside the acceptance of efficacy data for our parvovirus monoclonal antibody program. With cash runway now through the end of 2023, we are well-positioned to realize the value of our promising late-stage pipeline,” said KindredBio’s Chief Executive Officer, Richard Chin, M.D.

Development and Corporate Updates

Biologics Candidates

  • On April 20, 2021, KindredBio unveiled positive results in a new long-acting interleukin (IL)-31 antibody program (KIND-039) that integrates the Company’s novel half-life extension technology. Results from the pharmacokinetic study of the molecule demonstrated that the fully caninized, high-affinity antibody has up to a three-fold longer half-life compared to tirnovetmab. This extended half-life is expected to allow for up to three-fold longer interval between dosing.

    KindredBio’s half-life extension technology is intended to reduce dosing frequency, lower doses, and/or reduce cost of goods sold, while increasing pet owner convenience and compliance.

  • On December 22, 2020, KindredBio initiated the pivotal efficacy study for tirnovetmab (KIND-016), a fully caninized, high-affinity monoclonal antibody targeting IL-31 for the treatment of atopic dermatitis in dogs.

    Atopic dermatitis is the most common reason owners take their dog to the veterinarian, and is estimated to affect 10 – 15% of dogs worldwide. The current market size is close to $1 billion annually and growing.

  • On April 28, 2021 KindredBio announced acceptance of the parvovirus antibody prophylaxis study data and approval of the efficacy indication by the United States Department of Agriculture (USDA) Center for Veterinary Biologics. The USDA approved the claim that KIND-030 is effective for the passive immunization of healthy dogs 13 weeks of age or older against canine parvovirus (CPV) disease. The pivotal efficacy data demonstrated that 0% of the KIND-030 treated dogs developed parvovirus infection while 100% of the placebo-control dogs developed the disease, and also showed 100% survival rate in KIND-030. KIND-030 is a monoclonal antibody targeting CPV, and is partnered with Elanco Animal Health.

    The program is being pursued for two indications in dogs: prophylactic therapy to prevent clinical signs of canine parvovirus infection and treatment of established parvovirus infection. Completion of the upcoming pivotal efficacy study for the treatment indication is expected in the second quarter of 2021, with possible approval anticipated by year-end 2021. Approval of KIND-030 is subject to regulatory risk and timelines, and there is no set review timeline at the USDA Center for Veterinary Biologics.

  • The KIND-032 program is proceeding as expected with preparations underway for a pivotal study. In December 2019, KindredBio unveiled positive results from a randomized, placebo-controlled laboratory pilot study of KIND-032.
  • On December 21, 2020, KindredBio announced positive results from the pilot field effectiveness study of its monoclonal antibody against tumor necrosis factor for canine inflammatory bowel disease.

First Quarter 2021 Financial Results

For the quarter ended March 31, 2021, KindredBio reported a net loss of $9.7 million or $0.24 per share, as compared to a net loss of $22.8 million or $0.58 per share, for the same period in 2020.

The Company recorded $227,000 in net product revenues for ZimetaTM (dipyrone injection) for the first quarter of 2021, versus $603,000 in net product revenues for Mirataz for the same period in 2020. Dechra has been granted exclusive marketing, sales & distribution rights to Zimeta in the US and Canada in return for a royalty on sales and milestone payment upon achievement of a certain sales milestone. Zimeta product revenue in the first quarter of 2021 relates to excess inventory sold to Dechra.

With the sale of Mirataz to Dechra Pharmaceuticals completed in April 2020, KindredBio recorded royalty revenue of $326,000 for the quarter ended March 31, 2021. This compares with royalty revenue of $122,000 in the fourth quarter of 2020. The sequential increase reflects continued strong growth in US Mirataz sales to veterinary customers, alongside the initial contribution of European sales, which now span over 25 countries following the EU launch on February 4, 2021. The move-outs, or sales from distributors to veterinarians, were 60% higher in the U.S. in March 2021 compared to April 2020 when Dechra US assumed responsibility for commercialization of the drug. In addition, the manufacture of Vaxart’s oral vaccine candidate for COVID-19 resulted in contract manufacturing revenue of $1.8 million for the first quarter period.

The cost of product revenue totaled $207,000 in the first quarter of 2021, compared to $3.6 million in the same period in 2020. The cost of contract manufacturing revenue, which consisted primarily of the cost of direct materials, direct labor and overhead costs, was $383,000.

Research and development expenses for the quarter ended March 31, 2021 were $6.3 million, compared to $8.9 million for the same period in 2020. The $2.6 million decrease was primarily due to lower costs across the board consistent with the Company’s decision to discontinue small molecule development in favor of biologics programs. Stock based compensation expense for the first quarter of 2021 was $0.4 million, as compared to $0.6 million for the same period in 2020.

Selling, general and administrative expenses for the 2021 and 2020 first quarters were $4.7 million and $8.9 million, respectively. The $4.2 million year-over-year decrease was mainly the result of the elimination of KindredBio’s companion animal sales force. Stock based compensation expense was $2.1 million for the 2021 first quarter, versus $1.5 million in the year-ago period.

As of March 31, 2021, KindredBio had $63.3 million in cash, cash equivalents and investments, compared with $59.9 million as of December 31, 2020. Net cash used in operating activities for the first quarter of 2021 was approximately $9.4 million, reflecting a smaller organizational structure and to a lesser degree the contribution of contract manufacturing revenue. The Company invested approximately $260,000 in capital expenditures mainly for the Kansas facility. Cash used was offset by $13.7 million of net cash proceeds from the sale of securities in conjunction with an At Market Issuance Sales Agreement. In April 2021, the Company sold an additional $13.1 million (net) of securities through the ATM, which will be reflected in the second quarter financial results. KindredBio does not expect to use the remaining portion of the At Market Issuance Sales Agreement in the foreseeable future.  

With respect to spending in 2021, the Company remains focused on advancing its core biologics programs. KindredBio anticipates operating expenses to range between $41 to $43 million, excluding the impact of stock-based compensation expense and the impact of acquisitions, if any. KindredBio also plans to invest approximately $2.9 million in capital expenditures on lab and manufacturing equipment for its biologics programs in 2021. KindredBio believes its existing cash, cash equivalents and investments, remaining proceeds from the Mirataz sale, revenue from contract manufacturing and revenues in the form of royalties and partner licensing, will be sufficient to fund the current operating plan through the end of 2023, excluding the drawdown of $30 million from its debt facility.

Webcast and Conference Call 

KindredBio will host a conference call and webcast today at 4:30 p.m. Eastern time/1:30 p.m. Pacific time. Interested parties may access the call by dialing toll-free (855) 433-0927 from the U.S. or (484) 756-4262 internationally, and using conference ID 7573679. The call will be webcast live here, with a replay available at that link for 30 days.

About Kindred Biosciences

Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The Company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Forward-Looking Statements 

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, but not limited to, statements regarding our expectations about the trials, regulatory approval, manufacturing, distribution and commercialization of our current and future product candidates, and statements regarding our anticipated revenues, expenses, margins, profits and use of cash.

These forward-looking statements are based on our current expectations. These statements are not promises or guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results to be materially different from any future results expressed or implied by the forward-looking statements. These risks include, but are not limited to, the following: our limited operating history and expectations of losses for the foreseeable future; the absence of significant revenue from our products and our product candidates for the foreseeable future; the likelihood that our revenue will vary from quarter to quarter; our potential inability to obtain any necessary additional financing; our substantial dependence on the success of our products and our lead product candidates which may not be successfully commercialized even if they are approved for marketing; the effect of competition; our potential inability to obtain regulatory approval for our existing or future product candidates; our dependence on third parties to conduct some of our development activities; our dependence upon third-party manufacturers for supplies related to  our products and our product candidates and the potential inability of these manufacturers to deliver a sufficient  amount of supplies on a timely basis; the uncertain effect of the COVID-19 pandemic on our business, results of operations and financial condition; uncertainties regarding the outcomes of trials regarding our product candidates; our potential failure to attract and retain senior management and key scientific personnel; uncertainty about our ability to enter into satisfactory agreements with third-party licensees of our biologic products and uncertainty about the amount of revenue that we will receive from such agreements; our significant costs of operating as a public company; potential cyber-attacks on our information technology systems or on our third-party providers’ information technology systems, which could disrupt our operations; our potential inability to repay the secured indebtedness that we have incurred from third-party lenders, and the restrictions on our business activities that are contained in our loan agreement with these lenders; the risk that our 2020 strategic realignment and restructuring plans will result in unanticipated costs or revenue shortfalls; uncertainty about the amount of royalties that we will receive from the sale of Mirataz® to Dechra Pharmaceuticals PLC; the risk that the revenue from our delivery of services or products under any contract may be less than we anticipate if the other party to the contract exercises its right to terminate the contract prior to the completion of the contract or if such party is unable or unwilling to satisfy its payment obligations under the contract; our potential inability to obtain and maintain patent protection and other intellectual property protection for our products and our product candidates; potential claims by third parties alleging our infringement of their patents and other intellectual property rights; our potential failure to comply with regulatory requirements, which are subject to change on an ongoing basis; the potential volatility of our stock price; and the significant control over our business by our principal stockholders and management. 

For a further description of these risks and other risks that we face, please see the risk factors described in our filings with the U.S. Securities and Exchange Commission (the SEC), including the risk factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K and any subsequent updates that may be contained in our Quarterly Reports on Form 10-Q filed with the SEC. As a result of the risks described above and in our filings with the SEC, actual results may differ materially from those indicated by the forward-looking statements made in this press release. Forward-looking statements contained in this press release speak only as of the date of this press release and we undertake no obligation to update or revise these statements, except as may be required by law.

The results stated in this press release have not been reviewed by the Food and Drug Administration or the United States Department of Agriculture Center for Veterinary Biologics, as applicable.

Contacts
For investor inquiries: 
Katja Buhrer
Katja.buhrer@kindredbio.com 
(917) 969-3438

Kindred Biosciences to Announce First Quarter 2021 Financial Results

Company to Hold Conference Call and Webcast at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time on Tuesday, May 11, 2021.

San Francisco, California (May 3, 2021) — Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, will release its first quarter 2021 financial results on May 11, 2021, after the market close. The Company will host a conference call at 4:30 p.m. Eastern time/1:30 p.m. Pacific time that day.

Access the call by dialing toll-free (855) 433-0927 from the U.S. or (484) 756-4262 internationally, and using conference ID 7573679.

The call will also be webcast live here, with a replay available at that link for 30 days.

About Kindred Biosciences

Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Contact
Katja Buhrer 
katja.buhrer@kindredbio.com 
(917) 969-3438

Kindred Biosciences Announces Acceptance of Parvovirus Antibody Prophylaxis Study Data and Approval of Efficacy Indication

USDA approves the claim that the product is effective for the passive immunization of healthy dogs 13 weeks of age or older against canine parvovirus (CPV) disease

Results demonstrated 100% efficacy against the deadly disease, highlighting the potential to address a critical unmet medical need

San Francisco, California (April 28, 2021) – Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, today announced that the United States Department of Agriculture (USDA) Center for Veterinary Biologics has accepted efficacy data to support the prophylactic indication for KIND-030. The pivotal efficacy data demonstrated that 0% of the KIND-030 treated dogs developed parvovirus infection while 100% of the placebo-control dogs developed the disease, and also showed 100% survival rate in KIND-030. The efficacy study is part of the overall project data package required for full approval, along with safety, manufacturing and additional data. KIND-030 is a monoclonal antibody targeting canine parvovirus (CPV), and is partnered with Elanco Animal Health (NYSE: ELAN).

CPV is the most significant and contagious viral cause of enteritis in dogs, especially puppies, with mortality rates reportedly as high as 91% if untreated. There are currently no Food and Drug Administration or USDA approved treatments for CPV, nor any other available treatment. Currently, owners spend up to thousands of dollars per puppy in supportive care for CPV, with average cost of $1,200.

“As the first acceptance of efficacy data in one of our biologic programs, this marks a key milestone for KindredBio and brings us a step closer to transforming the care of dogs affected by this devastating disease. It has taken less than four years from concept to first efficacy study acceptance, underscoring the speed and efficiency of our drug development model,” said KindredBio’s Chief Executive Officer, Richard Chin, M.D.

As detailed in a September 2020 press release, in this randomized, blinded, placebo-controlled study, KIND-030 was administered to dogs as prophylactic therapy to prevent clinical signs of CPV infection. The primary objectives of the study were met. The data were submitted to the USDA on February 25, 2021.

“We are pleased with the progress of KIND-030 and our collaboration with the KindredBio team to advance this product through the final steps of the development and approval process” said Jeff Simmons, President and CEO of Elanco Animal Health, “We look forward to bringing this novel antibody to veterinarians to address the challenges of parvovirus infections in dogs.”

KIND-030 is currently being pursued for two indications in dogs: prophylactic therapy to prevent clinical signs of canine parvovirus infection and treatment of established parvovirus infection. The pivotal efficacy study for the treatment indication is expected to be completed in the second quarter of 2021, with potential approval of both indications by year-end. Regulatory approval and review timeline are subject to the typical risks inherent in such a process.

KIND-030 binds to critical portions of the virus, preventing the virus from entering into cells.

Veterinarians estimate that about half of the puppies they see infected with parvovirus have potentially exposed other puppies to the virus, and each puppy has on average the potential to expose five other puppies to the disease[1].

About Kindred Biosciences

Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The Company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

 

Forward-Looking Statements 

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, but not limited to, statements regarding our expectations about the trials, regulatory approval, manufacturing, distribution and commercialization of our current and future product candidates, and statements regarding our anticipated revenues, expenses, margins, profits and use of cash.

 

These forward-looking statements are based on our current expectations. These statements are not promises or guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results to be materially different from any future results expressed or implied by the forward-looking statements. These risks include, but are not limited to, the following: our limited operating history and expectations of losses for the foreseeable future; the absence of significant revenue from our products and our product candidates for the foreseeable future; the likelihood that our revenue will vary from quarter to quarter; our potential inability to obtain any necessary additional financing; our substantial dependence on the success of our products and our lead product candidates which may not be successfully commercialized even if they are approved for marketing; the effect of competition; our potential inability to obtain regulatory approval for our existing or future product candidates; our dependence on third parties to conduct some of our development activities; our dependence upon third-party manufacturers for supplies related to  our products and our product candidates and the potential inability of these manufacturers to deliver a sufficient  amount of supplies on a timely basis; the uncertain effect of the COVID-19 pandemic on our business, results of operations and financial condition; uncertainties regarding the outcomes of trials regarding our product candidates; our potential failure to attract and retain senior management and key scientific personnel; uncertainty about our ability to enter into satisfactory agreements with third-party licensees of our biologic products and uncertainty about the amount of revenue that we will receive from such agreements; our significant costs of operating as a public company; potential cyber-attacks on our information technology systems or on our third-party providers’ information technology systems, which could disrupt our operations; our potential inability to repay the secured indebtedness that we have incurred from third-party lenders, and the restrictions on our business activities that are contained in our loan agreement with these lenders; the risk that our 2020 strategic realignment and restructuring plans will result in unanticipated costs or revenue shortfalls; uncertainty about the amount of royalties that we will receive from the sale of Mirataz® to Dechra Pharmaceuticals PLC; the risk that the revenue from our delivery of services or products under any contract may be less than we anticipate if the other party to the contract exercises its right to terminate the contract prior to the completion of the contract or if such party is unable or unwilling to satisfy its payment obligations under the contract; our potential inability to obtain and maintain patent protection and other intellectual property protection for our products and our product candidates; potential claims by third parties alleging our infringement of their patents and other intellectual property rights; our potential failure to comply with regulatory requirements, which are subject to change on an ongoing basis; the potential volatility of our stock price; and the significant control over our business by our principal stockholders and management. 

 

For a further description of these risks and other risks that we face, please see the risk factors described in our filings with the U.S. Securities and Exchange Commission (the SEC), including the risk factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K and any subsequent updates that may be contained in our Quarterly Reports on Form 10-Q filed with the SEC. As a result of the risks described above and in our filings with the SEC, actual results may differ materially from those indicated by the forward-looking statements made in this press release. Forward-looking statements contained in this press release speak only as of the date of this press release and we undertake no obligation to update or revise these statements, except as may be required by law.

 

The canine parvovirus monoclonal antibody is not yet licensed by the United States Department of Agriculture Center for Veterinary Biologics.


Contacts

For investor inquiries: 
Katja Buhrer
Katja.buhrer@kindredbio.com 
(917) 969-3438

[1]  Data on file at Kindred Biosciences, Inc. 2019 Veterinarian Parvovirus Research: Anti-Canine Parvovirus Monoclonal Antibody Assessment 10.9.2019

Kindred Biosciences Unveils Positive Results from its Long-Acting Interleukin-31 Antibody PK Study

San Francisco, California (April 20, 2021) – Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, today unveiled positive results in a new long-acting interleukin (IL)-31 antibody program (KIND-039) that integrates the company’s novel half-life extension technology. Results from the pharmacokinetic study of the molecule demonstrate that the fully caninized, high-affinity antibody has up to a three-fold longer half-life compared to tirnovetmab. This extended half-life is expected to allow for up to three-fold longer interval between dosing.

“One of the main unmet needs in the canine dermatitis market is reduced dosing frequency and increased convenience. With these exciting results, we believe our new long-acting IL-31 antibody program has the potential to become a best-in-class therapeutic and the treatment of choice in the large and growing dermatitis market,” said KindredBio’s Chief Executive Officer, Richard Chin, M.D. “We expect to initiate the pivotal study for this molecule as early as the end of this year.”

KindredBio’s half-life extension technology is designed to improve therapeutic performance in a multitude of ways. The reduced dosing frequency and/or amount of dosing can lead to improved patient convenience and compliance. The technology can also significantly reduce the cost of goods and enhance profitability and market positioning. In addition, higher drug concentration using the same dose and dosing interval as the parent antibody can result in extended and more uniform therapeutic exposure and potentially improve efficacy and safety. KindredBio plans to leverage this platform technology for long-lasting therapeutics to develop to best-in-class products across multiple indications.

The new long-acting IL-31 program is expected to be complementary to the company’s tirnovetmab monoclonal antibody program targeting IL-31, for which a pivotal study was initiated in December, 2020. KindredBio’s market research shows that longer intervals between dosing is a key determinant of commercial success, but given the large size of the market and the heterogeneous nature of canine dermatitis, both products are expected to be well-received by veterinarians and owners.

KindredBio first announced its half-life extension technology for canine antibodies in January 2020.

About Kindred Biosciences

Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The Company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Forward-Looking Statements 

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, but not limited to, statements regarding our expectations about the trials, regulatory approval, manufacturing, distribution and commercialization of our current and future product candidates, and statements regarding our anticipated revenues, expenses, margins, profits and use of cash.

These forward-looking statements are based on our current expectations. These statements are not promises or guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results to be materially different from any future results expressed or implied by the forward-looking statements. These risks include, but are not limited to, the following: our limited operating history and expectations of losses for the foreseeable future; the absence of significant revenue from our products and our product candidates for the foreseeable future; the likelihood that our revenue will vary from quarter to quarter; our potential inability to obtain any necessary additional financing; our substantial dependence on the success of our products and our lead product candidates which may not be successfully commercialized even if they are approved for marketing; the effect of competition; our potential inability to obtain regulatory approval for our existing or future product candidates; our dependence on third parties to conduct some of our development activities; our dependence upon third-party manufacturers for supplies related to  our products and our product candidates and the potential inability of these manufacturers to deliver a sufficient  amount of supplies on a timely basis; the uncertain effect of the COVID-19 pandemic on our business, results of operations and financial condition; uncertainties regarding the outcomes of trials regarding our product candidates; our potential failure to attract and retain senior management and key scientific personnel; uncertainty about our ability to enter into satisfactory agreements with third-party licensees of our biologic products and uncertainty about the amount of revenue that we will receive from such agreements; our significant costs of operating as a public company; potential cyber-attacks on our information technology systems or on our third-party providers’ information technology systems, which could disrupt our operations; our potential inability to repay the secured indebtedness that we have incurred from third-party lenders, and the restrictions on our business activities that are contained in our loan agreement with these lenders; the risk that our 2020 strategic realignment and restructuring plans will result in unanticipated costs or revenue shortfalls; uncertainty about the amount of royalties that we will receive from the sale of Mirataz® to Dechra Pharmaceuticals PLC; the risk that the revenue from our delivery of services or products under any contract may be less than we anticipate if the other party to the contract exercises its right to terminate the contract prior to the completion of the contract or if such party is unable or unwilling to satisfy its payment obligations under the contract; our potential inability to obtain and maintain patent protection and other intellectual property protection for our products and our product candidates; potential claims by third parties alleging our infringement of their patents and other intellectual property rights; our potential failure to comply with regulatory requirements, which are subject to change on an ongoing basis; the potential volatility of our stock price; and the significant control over our business by our principal stockholders and management. 

For a further description of these risks and other risks that we face, please see the risk factors described in our filings with the U.S. Securities and Exchange Commission (the SEC), including the risk factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K and any subsequent updates that may be contained in our Quarterly Reports on Form 10-Q filed with the SEC. As a result of the risks described above and in our filings with the SEC, actual results may differ materially from those indicated by the forward-looking statements made in this press release. Forward-looking statements contained in this press release speak only as of the date of this press release and we undertake no obligation to update or revise these statements, except as may be required by law.

The results stated in this press release have not been reviewed by the Food and Drug Administration or the United States Department of Agriculture Center for Veterinary Biologics, as applicable.

Contacts

For investor inquiries: 
Katja Buhrer
Katja.buhrer@kindredbio.com 
(917) 969-3438

Kindred Biosciences Announces Fourth Quarter and Full Year 2020 Financial Results

San Francisco, California (March 16, 2021) – Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, today announced financial results for the fourth quarter and full year ended December 31, 2020 and provided updates on its programs. For the fourth quarter of 2020, KindredBio reported net revenues of $1.0 million and a net loss of $10.9 million, or $0.28 per share. For the full year 2020, net product revenues were $42.2 million and the net loss was $21.8 million, or $0.55 per share.

“We had a strong finish to 2020, reporting positive results from our pilot study for canine inflammatory bowel disease and initiating the tirnovetmab (IL-31 antibody) pivotal study for canine atopic dermatitis. Together with the recent award of a manufacturing contract by the National Cancer Institute, this positive momentum positions KindredBio strongly for the year ahead. We look forward to a number of important developments across our late-stage pipeline in 2021, including potential approval of our monoclonal antibody for canine parvovirus, updates on the tirnovetmab pivotal efficacy study, and pilot study results for our IL-4R program for canine atopic dermatitis,” said KindredBio’s Chief Executive Officer, Richard Chin, M.D.

Development and Corporate Updates

Biologics Candidates

  • On December 22, 2020, KindredBio initiated the pivotal efficacy study for tirnovetmab (KIND-016), a fully caninized, high-affinity monoclonal antibody targeting interleukin (IL)-31 for the treatment of atopic dermatitis in dogs.

    Atopic dermatitis is the most common reason owners take their dog to the veterinarian, and is estimated to affect 10 – 15% of dogs worldwide. The current market size exceeds $900 million annually and is growing.

  • In September 2020, KindredBio reported positive results from its pivotal efficacy study of KIND-030 for the prophylactic indication. KIND-030 is a monoclonal antibody targeting canine parvovirus. Completion of the upcoming pivotal efficacy study for the treatment indication is expected in the second quarter of 2021, with possible approval anticipated by year-end 2021. Approval of KIND-030 is subject to regulatory risk and timelines, and there is no set review timeline at the United States Department of Agriculture Center for Veterinary Biologics.

    KIND-030 is being pursued for two indications in dogs: prophylactic therapy to prevent clinical signs of canine parvovirus infection and treatment of established parvovirus infection. On December 11, 2020, KindredBio announced an agreement granting Elanco Animal Health Incorporated exclusive global rights to KIND-030, with total milestone payments exceeding $100 million.

  • A second pilot study to further assess dosing for KIND-032, a fully caninized monoclonal antibody targeting IL-4R for the treatment of atopic dermatitis in dogs, commenced in the third quarter of 2020. In December 2019, KindredBio unveiled positive results from a randomized, placebo-controlled laboratory pilot study of KIND-032.
  • On December 21, 2020, KindredBio announced positive results from the pilot field effectiveness study of its monoclonal antibody against tumor necrosis factor alpha (anti-TNFα antibody) for canine inflammatory bowel disease. Complete remission, defined as ≥ 75% reduction in average post-dose Canine Inflammatory Bowel Disease Activity Index (CIBDAI) score from baseline, was achieved in 75% of the anti-TNFα group compared to 17% in the placebo group. The treatment effect was early-onset and durable. At Day 7, the first post-dose visit, 75% of the anti-TNFα treated dogs showed ≥ 75% reduction of CIBDAI score from baseline, compared to 17% in the placebo group. Furthermore, 50% of the anti-TNFα treated dogs achieved and maintained 100% reduction of CIBDAI score from baseline throughout all post-dose visits, whereas none in the placebo group achieved the same result.

Mirataz

  • Dechra has realized strong growth in US Mirataz sales since their launch of the product in April 2020, achieving a near 50% increase in monthly sales to US clinics. While fourth quarter sales of Mirataz to distributors were lower quarter-over-quarter amid seasonal fluctuations in distributor ordering pattern, sales of Mirataz from distributors to veterinary clinics increased versus the third quarter. Dechra has launched Mirataz in the UK and European Union and is planning registration in several other territories. The sale of Mirataz to Dechra comprised an upfront payment of $43 million and royalties on worldwide sales.

Contract Manufacturing

  • On October 7, 2020, KindredBio announced an expansion of the original agreement for the manufacture of Vaxart’s COVID-19 vaccine, among other vaccine candidates. Total revenue from the partnership is expected to be approximately $20.5 million. Subsequent to quarter end, KindredBio was selected by the National Cancer Institute, part of the National Institutes of Health, to produce an experimental human papillomavirus (HPV) vaccine for clinical testing under the PREVENT Cancer Preclinical Drug Development Program (PREVENT) Indefinite Delivery Indefinite Quantity (IDIQ) contract. KindredBio was previously selected by the NCI as one of the three IDIQ contractors eligible for task order awards under the PREVENT Program.

Fourth Quarter and Full Year 2020 Financial Results

For the quarter ended December 31, 2020, KindredBio reported a net loss of $10.9 million, or $0.28 per share, compared to a net loss of $15.7 million, or $0.40 per share, for the same period in 2019. For the year ended December 31, 2020, the net loss was $21.8 million, or $0.55 per share, as compared to a net loss of $61.4 million, or $1.59 per share, in 2019.

The company recorded $1.0 million of net product revenues for the fourth quarter of 2020, versus $1.4 million in the year-ago period. Full year 2020 net product revenues were $42.2 million, compared with $4.3 million for the year ended December 31, 2019. The year-over-year increase in revenue was primarily due to $38.7 million from the sale of Mirataz to Dechra Pharmaceuticals, which was completed in April 2020. The company recorded royalty revenue of $122,000 in the fourth quarter and $535,000 for the year.

Substantially all of the $878,000 in product revenues for the year 2020 were for Mirataz. Product revenues for ZimetaTM (dipyrone injection) were $8,000 in the fourth quarter and $27,000 for the year, reflecting decreased equine events and transportation due to COVID-19. Dechra has been granted exclusive marketing, sales & distribution rights to Zimeta in the US and Canada in return for a royalty on sales and milestone payment upon achievement of a certain sales milestone. In conjunction with Mirataz and Zimeta, the company also recorded $12,000 and $29,000 in revenue derived from the co-marketing of products for partners, namely Butterfly Networks and Astaria Global, in 2020.

The company’s agreement with Vaxart, Inc. for the manufacture of Vaxart’s oral vaccine candidate for COVID-19 resulted in contract manufacturing revenue of $233,000 and $1.6 million, based on the percentage completion of specific milestones, for the three and twelve months ended December 30, 2020, respectively.

Elanco’s non-refundable upfront payment of $500,000 for the parvovirus partnership was recorded as partner licensing revenue.

The cost of product revenue totaled $336,000 in the fourth quarter and $3.9 million for the twelve-month period in 2020, compared to $187,000 and $587,000 for the same periods in 2019. Cost of product sales in 2020 included a $3.5 million inventory write-off on Mirataz due to the transition to Dechra brand labelling. Cost of contract manufacturing revenues, which consisted primarily of the cost of direct materials, direct labor and overhead costs, were $45,000 and $681,000 for the three and twelve months ended December 30, 2020.

Research and development expenses totaled $7.6 million for the fourth quarter ended December 31, 2020 versus $7.1 million for the same period in 2019. For the full year 2020, research and development expenses were $31.3 million, compared to $28.3 million in 2019. Stock-based compensation expense related to research and development was $1.9 million, versus $1.8 million in 2019. The $3.0 million year-over-year increase in research and development expenses was primarily due to the inclusion of expenses from the Kansas facility as it began to manufacture clinical trial material, partially offset by lower costs consistent with the decision to discontinue small molecule development in favor of biologics programs. Prior to 2020, construction and commissioning expenditures associated with the Kansas facility had been categorized as general and administrative expenses.  

Selling, general and administrative expenses totaled $3.3 million for the fourth quarter ended December 31, 2020, versus $9.6 million for the same period in 2019. For the full year 2020, selling, general and administrative expenses were $22.0 million, compared to $37.9 million for 2019. The $15.9 million year-over-year decrease is the result of the re-categorization of Kansas plant expenditures as research and development expenses, and lower payroll and related expenses as a result of the elimination of KindredBio’s companion animal sales force. Stock based compensation expense was $5.7 million in 2020, versus $5.5 million in the prior year.

As of December 31, 2019, KindredBio had $59.9 million in cash, cash equivalents and investments, compared to $73.5 million at December 31, 2019. Net cash used in operating activities in 2020 was approximately $9.9 million, reflecting payment received for the Mirataz asset sale. The company also invested approximately $3.6 million in capital expenditures for the purchase of lab and manufacturing equipment for the Kansas facility.

With respect to spending in 2021, the Company remains focused on advancing its core biologics programs. KindredBio anticipates operating expenses to range between $41 to $43 million, excluding the impact of stock-based compensation expense and the impact of acquisitions, if any. KindredBio also plans to invest approximately $3.0 million in capital expenditures on lab and manufacturing equipment for its biologics programs in 2021. KindredBio believes its existing cash, cash equivalents and investments, remaining proceeds from the Mirataz sale, revenue from contract manufacturing and revenues in the form of royalties and partner licensing, will be sufficient to fund the current operating plan through early 2023, excluding the drawdown of $30 million from its debt facility.

Webcast and Conference Call 

KindredBio will host a conference call and webcast today at 4:30 p.m. Eastern time/1:30 p.m. Pacific time. Interested parties may access the call by dialing toll-free (855) 433-0927 from the U.S. or (484) 756-4262 internationally, and using conference ID 3989605. The call will be webcast live here, with a replay available at that link for 30 days.

About Kindred Biosciences

Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The Company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Forward-Looking Statements 

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, but not limited to, statements regarding our expectations about the trials, regulatory approval, manufacturing, distribution and commercialization of our current and future product candidates, and statements regarding our anticipated revenues, expenses, margins, profits and use of cash.

These forward-looking statements are based on our current expectations. These statements are not promises or guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results to be materially different from any future results expressed or implied by the forward-looking statements. These risks include, but are not limited to, the following: our limited operating history and expectations of losses for the foreseeable future; the absence of significant revenue from our products and our product candidates for the foreseeable future; the likelihood that our revenue will vary from quarter to quarter; our potential inability to obtain any necessary additional financing; our substantial dependence on the success of our products and our lead product candidates which may not be successfully commercialized even if they are approved for marketing; the effect of competition; our potential inability to obtain regulatory approval for our existing or future product candidates; our dependence on third parties to conduct some of our development activities; our dependence upon third-party manufacturers for supplies related to  our products and our product candidates and the potential inability of these manufacturers to deliver a sufficient  amount of supplies on a timely basis; the uncertain effect of the COVID-19 pandemic on our business, results of operations and financial condition; uncertainties regarding the outcomes of trials regarding our product candidates; our potential failure to attract and retain senior management and key scientific personnel; uncertainty about our ability to enter into satisfactory agreements with third-party licensees of our biologic products and uncertainty about the amount of revenue that we will receive from such agreements; our significant costs of operating as a public company; potential cyber-attacks on our information technology systems or on our third-party providers’ information technology systems, which could disrupt our operations; our potential inability to repay the secured indebtedness that we have incurred from third-party lenders, and the restrictions on our business activities that are contained in our loan agreement with these lenders; the risk that our 2020 strategic realignment and restructuring plans will result in unanticipated costs or revenue shortfalls; uncertainty about the amount of royalties that we will receive from the sale of Mirataz® to Dechra Pharmaceuticals PLC; the risk that the revenue from our delivery of services or products under any contract may be less than we anticipate if the other party to the contract exercises its right to terminate the contract prior to the completion of the contract or if such party is unable or unwilling to satisfy its payment obligations under the contract; our potential inability to obtain and maintain patent protection and other intellectual property protection for our products and our product candidates; potential claims by third parties alleging our infringement of their patents and other intellectual property rights; our potential failure to comply with regulatory requirements, which are subject to change on an ongoing basis; the potential volatility of our stock price; and the significant control over our business by our principal stockholders and management. 

For a further description of these risks and other risks that we face, please see the risk factors described in our filings with the U.S. Securities and Exchange Commission (the SEC), including the risk factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K and any subsequent updates that may be contained in our Quarterly Reports on Form 10-Q filed with the SEC. As a result of the risks described above and in our filings with the SEC, actual results may differ materially from those indicated by the forward-looking statements made in this press release. Forward-looking statements contained in this press release speak only as of the date of this press release and we undertake no obligation to update or revise these statements, except as may be required by law.

The results stated in this press release have not been reviewed by the Food and Drug Administration or the United States Department of Agriculture Center for Veterinary Biologics, as applicable.

Contacts

For investor inquiries: 
Katja Buhrer
Katja.buhrer@kindredbio.com 
(917) 969-3438

Kindred Biosciences to Announce Fourth Quarter and Full Year 2020 Financial Results

Company to Hold Conference Call and Webcast at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time on Tuesday, March 16, 2021.

San Francisco, California (March 8, 2021) — Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, will release its fourth quarter and full year 2020 financial results on March 16, 2021, after the market close. The Company will host a conference call at 4:30 p.m. Eastern time/1:30 p.m. Pacific time that day.

Access the call by dialing toll-free (855) 433-0927 from the U.S. or (484) 756-4262 internationally, and using conference ID 3989605.

The call will also be webcast live here, with a replay available at that link for 30 days.

About Kindred Biosciences
Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Contact
Katja Buhrer 
katja.buhrer@kindredbio.com 
(917) 969-3438

Kindred Biosciences to Present at Barclays Global Healthcare Conference and H.C. Wainwright Global Life Sciences Conference

SAN FRANCISCO, March 2, 2021 — Kindred Biosciences, Inc. (NASDAQ: KIN), a biopharmaceutical company focused on saving and improving the lives of pets, will present at the Barclays Global Healthcare Conference on March 10 and the H.C. Wainwright Global Life Sciences Conference on March 9-10.   

Dr. Richard Chin, Chief Executive Officer, will be available for one-on-one meetings. During this time, investors will have the opportunity to discuss recent developments, study results from key therapeutic programs in development, and upcoming milestones.

Conference Details:

Barclays Global Healthcare Conference

Date: March 10, 2021

Presentation time: 2:25 – 2.50p.m. ET, Virtual Track 3

Webcast URL: Click here

H.C. Wainwright Global Life Sciences Conference

Date: March 9-10, 2021

Presentation time: On demand access beginning March 9

Webcast URL: Click here

An archived version of the above webcasts will be available for 30 days on the KindredBio website.

About Kindred Biosciences 

Kindred Biosciences is a biopharmaceutical company developing innovative biologics focused on saving and improving the lives of pets. Its mission is to bring to pets the same kinds of safe and effective medicines that human family members enjoy. The Company’s strategy is to identify targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated targets for dogs and cats. KindredBio has a deep pipeline of novel biologics in development across many therapeutic classes, alongside state-of-the-art biologics manufacturing capabilities and a broad intellectual property portfolio.

For more information, visit: www.kindredbio.com

Contact

Katja Buhrer 
katja.buhrer@kindredbio.com 
(917) 969-3438