Opexa Therapeutics Reports Year End 2013 Financial Results and Provides Corporate Update

2013 and recent highlights include:

2013 was a strong year for Opexa as we executed on several critical strategic goals for the company. We secured a partnering agreement with Merck Serono, a large pharmaceutical company with a deep understanding of Multiple Sclerosis, advanced on the landmark Abili-T study in Secondary Progressive MS patients and ended the year in a strong financial position, commented Neil K. Warma, President and Chief Executive Officer of Opexa. In 2014, we look forward to completing enrollment in the Abili-T study, which is expected to occur in the second quarter of this year, and exploring other potential disease areas through the utilization of our Precision ImmunotherapyTM platform.

The focus of the Company remains fixed on the execution of the Phase IIb study in Secondary Progressive MS patients. Currently, the treatment options for these patients are very limited, so the importance of bringing a safe and effective therapy to market is heightened. If we are successful with the development of Tcelna in the ongoing SPMS trial and Merck Serono exercises its option, Merck Serono would bear the expense of subsequent clinical development of Tcelna in MS. In addition, we believe Opexa would be solidly positioned with the potential to receive milestone payments in excess of $200 million as well as royalty payments ranging from 8-15% on product sales in the event Merck Serono is successful in its development efforts.

Following our capital raise in August 2013, we were able to activate all the remaining clinical trial sites selected to participate in the Abili-T study. The enthusiasm from the sites and patients has remained strong and we have exceeded 80% of the enrollment target. We are aiming to treat a total of 180 patients in the study and anticipate reaching full enrollment in the second quarter of 2014. We believe presentation of top-line data remains on target for mid-2016, added Mr. Warma.

With the MS franchise progressing well, we are evaluating the potential of our T-cell platform, ImmPath, in indications beyond MS. We have worked diligently to optimize the manufacturing process and believe that our platform can be leveraged to tailor personalized therapies for patients in other disease areas. Further evaluation will include continued discussions with key opinion leaders, FDA and clinical experts, assessment of the capital requirements and availability of sufficient resources, and a scientific understanding of the disease mechanism.

"Lastly, we were able to raise a significant amount of capital in 2013, noted Mr. Warma. As of December 31, 2013, our cash and cash equivalents totaled approximately $23,644,542. During the first quarter of 2013, we raised net proceeds of approximately $9.6 million in capital through financing transactions and the $5 million from an upfront payment from Merck Serono. During the third quarter, we were able to raise net proceeds of approximately $17.4 million in additional capital through an underwritten public offering of our common stock. During the fourth quarter, we executed on another underwritten public offering of our common stock and raised net proceeds of approximately $7.3 million of additional capital. Based on our current burn rate, we believe we have sufficient liquidity to support our current clinical activities for the Abili-T trial and general operations to sustain the Company and support such trial into the fourth quarter of 2015.

Year Ended December 31, 2013 Financial Results

During the year ended December 31, 2013, Opexa reported revenue of $1,266,611 related to the $5 million upfront payment from Merck in connection with the Option and License Agreement. No commercial revenues were recorded for the year ended December 31, 2012.

Research and development expenses were $9,181,090 for the year ended December 31, 2013, compared to $6,318,476 for the year ended December 31, 2012. The increase in expenses was primarily due to increases in staff to conduct increased development activities, the procurement and use of supplies used in both our laboratory and product manufacturing operations, the engagement of consultants and the costs of patient participation in our Phase IIb clinical study, facilities costs, legal costs and stock compensation expense, and was partially offset by a decrease in costs associated with the training and qualification activities preceding the commencement of the clinical trial in the second half of 2012.

General and administrative expenses were $3,670,769 for the year ended December 31, 2013, as compared to $2,508,541 for the year ended December 31, 2012. The increase in expenses was primarily due to a modest increase in employees to support the ongoing clinical trial, an increase in consultants and other costs to support business development and investor relations activities, and increases in NASDAQ listing fees, legal costs and stock compensation expense.

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Opexa Therapeutics Reports Year End 2013 Financial Results and Provides Corporate Update