Inventiva (IVA) Stock: Why It Surged Over 20% Today

By Amit Chowdhry ● Sep 22, 2022
  • The stock price of Inventiva (IVA) increased by over 20% intraday today. This is why.

The stock price of Inventiva (IVA) increased by over 20% intraday today. 

Why: Interim financial results for the six months ended June 30, 2022

Details: Inventiva (IVA) reported its interim financial results for the six months ended June 30, 2022, and provided a corporate update.

Key financial results for the first half of 2022

— Revenues for the first half of 2022 reached €0.1 million in line with the same period in 2021.

— R&D expenses for the first half of 2022 amounted to €29.9 million, mainly driven by the development of lanifibranor in NASH, and were up 56% compared to the €19.1 million for the first half of 2021. This significant increase was driven mostly by the costs associated with the NATiV3 Phase III clinical trial of lanifibranor in NASH including a full six months of operating for the U.S. affiliate and, to a lesser extent, with the Legend Phase IIa combination trial with lanifibranor and empagliflozin in patients with NASH and type 2 diabetes.

— General and administrative expenses (G&A) amounted to €6.8 million in the first half of 2022, an increase of 18% compared to €5.8 million in the first half of 2021, mainly due to personnel costs linked to the share-based payment expenses, a full six months of operating for the U.S. affiliate and to a lesser extent an increase in compliance fees related to the dual listing of Inventiva securities.

— Other operating income (expenses) amounted to €0.1 million in the first half of 2022 compared to (€0.6) million in the first half of 2021.

— Net financial income amounted to €4.0 million in the first half of 2022, mainly linked to foreign exchange gains due to the appreciation of the U.S. dollar against the euro during the period.

— The company’s net loss stood at (€29.5) million in the first half of 2022 compared to (€23.1) million in the first half of 2021.

— Inventiva’s net cash flow (excluding any exchange rate effect) amounted to (€12.5) million in the six months ended June 30, 2022, compared to (€15.0) million in the same period in 2021.

— The net cash used in operating activities amounted to €26.2 million in the first half of 2022 compared to €19.8 million for the same period in 2021. This increase in cash use is mainly due to higher R&D expenses. Cash flow from operating activities was also positively impacted in the first half of 2022 by the payment in January 2022 of €4 million milestone payment from AbbVie following the inclusion of the first patient in the ongoing Phase IIb clinical trial with cedirogant (formerly ABBV-157) in adult patients with moderate to severe chronic plaque psoriasis, and the 2021 French Research tax credit (“CIR”) for €3.6 million that was received in April 2022.

— Net cash generated used in investing activities for the first half of 2022 amounted to (€0.3) million, compared to €4.7 million3 for the same period in 2021.

— Net cash generated from financing activities for the first half of 2022 amounted to €14.0 million compared to no net cash generated from financing activities over the first half of 2021. This increase is mainly driven by the equity raised through the Company’s At-The-Market Program for approximately €9.4 million (gross proceeds) on June 15, 2022, and three loan agreements with a syndicate French banks for a total amount of €5.3 million. One of the loans has been contracted as part of a French state-guaranteed loan facility (“Prêt Garanti par l’Etat” or “PGE”) with Bpifrance and the two others obtained as part of a French State stimulus economic plan, (“Prêts Participatifs Relance” or “PPR”) granted by Crédit Agricole Champagne-Bourgogne and Société Générale.

— Over the first half of 2022, the Company recorded a positive exchange rate effect on cash and cash equivalents of €2.4 million3 versus €3.0 million for the first half of 2021, due to the favourable evolution of USD versus Euro.

— As of June 30, 2022, Inventiva’s cash and cash equivalent position was €76.4 million compared to €86.6 million as of December 31, 2021. The cash position including short term deposits1 reach €87,2 million compared to €95.4 million as of December 31, 2021.

— Considering its current R&D and clinical development programs and excluding any potential proceeds from the EIB credit facility and any potential additional financial resources, the Company estimates that its existing cash, cash equivalents and short-term deposits should allow the Company to fund its operations through Q4 2023 [including the expected €25 million upfront payment from Sino Biopharm and the €25 million from the EIB credit facility.

KEY QUOTE:

“The first half of this year has been paved with several successes for Inventiva, both financially and in terms of research & development. Our collaboration with AbbVie led to a new €4 million milestone payment following the initiation of the Phase IIb clinical trial with cedirogant which is expected to finish H1 2023. We estimate our current cash position, combined with the expected $12 million upfront payment from the agreement with Sino Biopharm and the anticipated first €25 million tranche under the EIB credit facility extends our cash runway through Q4 2023. This agreement with Sino Biopharm represents an important milestone and allows us to start the development of lanifibranor for the treatment of NASH in a country where the prevalence of NASH is particularly high. We also continued to progress our NASH programs with the screening of the first patient in our LEGEND trial and the clearance of our IND application by the FDA. Looking ahead, we expect even more exciting developments, including with the results from our Phase II clinical trial evaluating lanifibranor for the treatment of NAFLD in patients with type 2 diabetes planned for Q1 2023. Finally, we are also very pleased to have feedback from the FDA that a single phase 2/3 trial could potentially support a marketing application for odiparcil.”

— Frédéric Cren, Chairman, Chief Executive Officer and cofounder of Inventiva