SAN FRANCISCO, July 31, 2014 /PRNewswire/ -- Nektar Therapeutics
(Nasdaq: NKTR) today reported its financial results for the second
quarter ended June 30, 2014.
Cash and investments in marketable securities at June 30, 2014 were $301.4
million as compared to $309.1
million at March 31,
2014.
"The second half of 2014 will be an exciting time for Nektar as
we look forward to significant milestones for a number of our
late-stage clinical programs," said Howard
W. Robin, President and Chief Executive Officer of Nektar.
"The first of these is the potential US and EU approvals of
Movantik™ with our partner AstraZeneca. If approved,
Movantik would be the first oral targeted therapy approved for
opioid induced constipation, a debilitating condition that occurs
in up to 80%* of the 69 million chronic pain patients worldwide.
Our partner Baxter has completed
dosing in their Phase 3 study for BAX 855, a longer-acting
PEGylated Factor VIII therapy to treat hemophilia A and plans to
file the BLA in the U.S. by the end of this year. In our
proprietary pipeline, we are on track for topline results from the
Phase 3 breast cancer study for NKTR-102 in Q1 2015."
Revenue in the second quarter of 2014 was $28.5 million as compared to $33.9 million in the second quarter of 2013.
Year-to-date revenue for 2014 was $48.3
million as compared to $56.9
million in the first half of 2013. The decrease in
revenue in the second quarter and first half of 2014 as compared to
the same periods in 2013 is primarily due to decreased
manufacturing activity. Revenue included non-cash royalty
revenue, related to our 2012 royalty monetization, of $4.8 million and $10.6
million in the second quarter and first half of 2014,
respectively, and $3.8 million and
$8.2 million in the second quarter
and first half of 2013, respectively. This non-cash royalty revenue
is offset by non-cash interest expense.
Total operating costs and expenses in the second quarter of 2014
were $51.4 million as compared to
$66.5 million in the second quarter
of 2013. Total operating costs and expenses in the first half
of 2014 were $107.6 million as
compared to $134.6 million in the
first half of 2013. Total operating costs and expenses
decreased primarily as a result of decreased research and
development (R&D) expense, as well as decreased cost of goods
sold associated with decreased manufacturing activity.
Research and development expense in the second quarter of 2014
was $36.7 million as compared to
$52.2 million in the second quarter
of 2013. For the first half of 2014, R&D expense was
$75.0 million as compared to
$97.8 million in the first half of
2013. R&D expense was lower in the second quarter and
first half of 2014 as compared to the same periods in 2013
primarily because of reduced expenses for the Phase 3 study of
etirinotecan pegol (NKTR-102) in metastatic breast cancer, which
completed enrollment in the third quarter of 2013. Additionally,
R&D expense in the second quarter and first half of 2013
included costs related to the Phase 2 study of NKTR-181, which was
completed in 2013. These decreases in R&D expense in 2014
were partially offset by costs for the preparation for the start of
Phase 3 for NKTR-181, the ongoing Phase 1 study of NKTR-171, and
the continued production of devices for the ongoing Phase 3 studies
of Amikacin Inhale.
General and administrative expense was $9.6 million in the second quarter of 2014 as
compared to $9.2 million in the
second quarter of 2013. G&A expense in the first half of
2014 was $19.5 million as compared to
$20.1 million in the first half of
2013.
Non-cash interest expense incurred in connection with the 2012
royalty monetization was $5.1 million
and $10.5 million in the second
quarter and first half of 2014, respectively, as compared to
$5.5 million and $11.0 million in the second quarter and first
half of 2013, respectively.
Net loss in the second quarter of 2014 was $32.6 million or $0.26 loss per share as compared to $42.7 million or $0.37 loss per share in the second quarter of
2013. Net loss in the first half of 2014 was $78.8 million or $0.63 loss per share as compared to $97.8 million or $0.85 loss per share in the first half of
2013.
The company also announced upcoming presentations at the
following medical meetings and scientific congresses during the
third and fourth quarters of 2014:
Global Cancer Conference 2014, Hyderabad, India:
- Oral Abstract Title: "NKTR-214: A long-acting,
engineered immunotherapy shows excellent therapeutic efficacy in
multiple syngeneic mouse tumor models both alone and in combination
with checkpoint inhibition", Addepalli, M., et al.
- Date: September 15-17, 2014
IASP 15th World Congress on Pain, Buenos Aires, Argentina:
- Abstract/Poster Title: "Multi-dimensional pathway
analysis reveals unique pharmacological signatures of kappa opioid
receptor agonists", Brew, C., et al.
- Date: October 10, 2014,
9:30 a.m. Argentina Time
Society for Neuroscience, Washington, DC:
- Abstract/Poster Title: "SEO-16: An orally active opioid
analgesic with rapid onset of activity and reduced CNS side
effects", Harrison, S., et al.
- Poster Session 244: "Opioids and other analgesics"
- Date: November 16, 2014,
1:00 p.m. — 5:00 p.m. Eastern
Time
Conference Call to Discuss Second Quarter 2014 Financial
Results
Nektar management will host a conference call to review the
results beginning at 5:00 p.m. Eastern
Time/2:00 p.m. Pacific Time
today, Thursday, July 31, 2014.
This press release and a live audio-only Webcast of the
conference call can be accessed through a link that is posted on
the home page and Investor Relations section of the Nektar website:
http://www.nektar.com. The web broadcast of the conference call
will be available for replay through Monday,
September 1, 2014.
To access the conference call, follow these
instructions:
Dial: (877) 881.2183 (U.S.); (970) 315.0453
(international)
Passcode: 73168608 (Nektar Therapeutics
is the host)
In the event that any non-GAAP financial measure is discussed on
the conference call that is not described in the press release, or
explained on the conference call, related information will be made
available on the Investor Relations page at the Nektar website as
soon as practical after the conclusion of the conference call.
About Nektar
Nektar Therapeutics (NASDAQ: NKTR) is a biopharmaceutical
company developing novel therapeutics based on its advanced polymer
conjugate technology platform. Nektar has a robust R&D pipeline
of potentially high-value therapeutics in pain, oncology and other
therapeutic areas. In the area of pain, Nektar has an exclusive
worldwide license agreement with AstraZeneca for Movantik™
(naloxegol), an investigational drug candidate, which has been
filed for regulatory approvals in the U.S., Europe and Canada as a once- daily, oral tablet for the
treatment of opioid-induced constipation. This agreement also
includes Movantik fixed dose combination products (formerly
NKTR-119), an earlier stage development program that is a
co-formulation of Movantik and an opioid. NKTR-181, a novel
mu-opioid analgesic molecule for chronic pain conditions, has
completed Phase 2 development. NKTR-171, a new sodium channel
blocker being developed as an oral therapy for the treatment of
peripheral neuropathic pain, is in Phase 1 clinical development. In
oncology, etirinotecan pegol (NKTR-102) is being evaluated in a
Phase 3 clinical study (the BEACON study) for the treatment of
metastatic breast cancer and is also in Phase 2 studies for the
treatment of lung and brain cancers. In anti-infectives, Amikacin
Inhale is in Phase 3 studies conducted by Bayer Healthcare as an
adjunctive treatment for intubated and mechanically ventilated
patients with Gram-negative pneumonia. Additional late-stage
development products that leverage Nektar's proprietary technology
platform include Baxter's BAX 855,
a longer-acting rFVIII program, which is in Phase 3 clinical
development for patients with hemophilia A.
Nektar's technology has enabled eight approved products in the
U.S. or Europe through
partnerships with leading biopharmaceutical companies, including
UCB's Cimzia® for Crohn's disease and rheumatoid
arthritis, Roche's PEGASYS® for hepatitis C and
Amgen's Neulasta® for neutropenia.
Nektar is headquartered in San
Francisco, California, with additional operations in
Huntsville, Alabama and
Hyderabad, India. Further
information about the company and its drug development programs and
capabilities may be found online at http://www.nektar.com
*Sources: Bell TJ et. al. Pain Med 2009;10(1):35-42, Hess B et.
al. Eur J Intern Med 2011;22(5):527-531, Rosti G et. al Eur Rev Med
Pharmacol Sci. 2010;14(12):1045-1050. Galvez R et. al. Aten
Primaria 2014;46(1):32-39, Droney J et. al. Support Care Cancer
2008;16(5):453-459.
Movantik is a trademark of AstraZeneca.
Cautionary Note Regarding Forward-Looking
Statements
This press release contains "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements can be identified by words such
as: "anticipate," "intend," "plan," "expect," "believe," "should,"
"may," "will" and similar references to future periods. Examples of
forward-looking statements include, among others, statements we
make regarding the potential regulatory approval of
Movantik™; the timing of the announcement of clinical
results and potential regulatory filings by Baxter Healthcare for
BAX 855; the timing of availability of topline overall survival
data for the NKTR-102 BEACON study; and the value and potential of
our technology and research and development pipeline.
Forward-looking statements are neither historical facts nor
assurances of future performance. Instead, they are based only on
our current beliefs, expectations and assumptions regarding the
future of our business, future plans and strategies, anticipated
events and trends, the economy and other future conditions. Because
forward-looking statements relate to the future, they are subject
to inherent uncertainties, risks and changes in circumstances that
are difficult to predict and many of which are outside of our
control. Our actual results may differ materially from those
indicated in the forward-looking statements. Therefore, you should
not rely on any of these forward-looking statements. Important
factors that could cause our actual results to differ materially
from those indicated in the forward-looking statements include,
among others, (i) our drug candidates and those of our
collaboration partners are in various stages of clinical
development and the risk of failure is high and can unexpectedly
occur at any stage prior to regulatory approval for numerous
reasons including safety and efficacy findings even after positive
findings in previous preclinical and clinical studies; (ii) the
timing of the commencement or end of clinical trials and the
commercial launch of our drug candidates may be delayed or
unsuccessful due to regulatory delays, slower than anticipated
patient enrollment, manufacturing challenges, changing standards of
care, evolving regulatory requirements, clinical trial design,
clinical outcomes, competitive factors, or delay or failure in
ultimately obtaining regulatory approval in one or more important
markets; (iii) acceptance, review and approval decisions for new
drug applications by health authorities is an uncertain and
evolving process and health authorities retain significant
discretion at all stages of the regulatory review and approval
decision process; (iv) scientific discovery of new medical
breakthroughs is an inherently uncertain process and the future
success of the application of our technology platform to potential
new drug candidates is therefore highly uncertain and unpredictable
and one or more research and development programs could fail; (v)
patents may not issue from our patent applications for our drug
candidates, patents that have issued may not be enforceable, or
additional intellectual property licenses from third parties may be
required; and (vi) the outcome of any existing or future
intellectual property or other litigation related to our drug
candidates and those of our collaboration partners. Other
important risks and uncertainties set forth in our Quarterly Report
on Form 10-Q filed with the Securities and Exchange Commission on
May 8, 2014. Any forward-looking
statement made by us in this press release is based only on
information currently available to us and speaks only as of the
date on which it is made. We undertake no obligation to update any
forward-looking statement, whether written or oral, that may be
made from time to time, whether as a result of new information,
future developments or otherwise.
Nektar Investor Inquiries:
|
|
Jennifer Ruddock/Nektar
Therapeutics
|
(415) 482-5585
|
Susan Noonan/SA Noonan Communications,
LLC
|
(212) 966-3650
|
|
|
Nektar Media Inquiries:
|
|
Jodi Sievers/Nektar
Therapeutics
|
(415)
482-5593
|
NEKTAR
THERAPEUTICS
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
June 30,
2014
|
|
December 31, 2013
(1)
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
$
30,699
|
|
$
39,067
|
|
Short-term
investments
|
|
|
|
245,737
|
|
197,959
|
|
Accounts receivable,
net
|
|
|
|
3,047
|
|
2,229
|
|
Inventory
|
|
|
|
|
14,111
|
|
13,452
|
|
Other current
assets
|
|
|
|
4,629
|
|
5,175
|
|
|
Total current
assets
|
|
|
|
298,223
|
|
257,882
|
|
|
|
|
|
|
|
|
|
|
|
Restricted
cash
|
|
|
|
|
25,000
|
|
25,000
|
Property and
equipment, net
|
|
|
|
71,070
|
|
66,974
|
Goodwill
|
|
|
|
|
|
76,501
|
|
76,501
|
Other
assets
|
|
|
|
|
7,343
|
|
8,170
|
|
Total
assets
|
|
|
|
|
$ 478,137
|
|
$
434,527
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
|
$
7,437
|
|
$
9,115
|
|
Accrued
compensation
|
|
|
|
11,386
|
|
14,254
|
|
Accrued
expenses
|
|
|
|
5,814
|
|
6,243
|
|
Accrued clinical
trial expenses
|
|
|
13,208
|
|
16,905
|
|
Interest
payable
|
|
|
|
|
6,917
|
|
6,917
|
|
Deferred revenue,
current portion
|
|
|
24,766
|
|
23,664
|
|
Other current
liabilities
|
|
|
|
14,827
|
|
21,123
|
|
|
Total current
liabilities
|
|
|
|
84,355
|
|
98,221
|
|
|
|
|
|
|
|
|
|
|
|
Senior secured
notes
|
|
|
|
125,000
|
|
125,000
|
Capital lease
obligations, less current portion
|
|
|
6,025
|
|
8,049
|
Liability related to
receipt of refundable milestone payment
|
|
70,000
|
|
70,000
|
Liability related to
sale of future royalties, less current portion
|
|
121,431
|
|
121,520
|
Deferred revenue,
less current portion
|
|
|
88,918
|
|
82,384
|
Other long-term
liabilities
|
|
|
|
17,768
|
|
19,256
|
|
|
Total
liabilities
|
|
|
|
513,497
|
|
524,430
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity
(deficit) :
|
|
|
|
|
|
|
|
Preferred
stock
|
|
|
|
|
-
|
|
-
|
|
Common
stock
|
|
|
|
|
12
|
|
11
|
|
Capital in excess of
par value
|
|
|
1,776,746
|
|
1,643,660
|
|
Accumulated other
comprehensive loss
|
|
|
(887)
|
|
(1,181)
|
|
Accumulated
deficit
|
|
|
|
(1,811,231)
|
|
(1,732,393)
|
|
|
Total stockholders'
equity (deficit)
|
|
|
(35,360)
|
|
(89,903)
|
|
Total liabilities and
stockholders' equity (deficit)
|
|
$ 478,137
|
|
$
434,527
|
|
|
|
|
|
|
|
|
|
|
|
(1) The consolidated
balance sheet at December 31, 2013 has been derived from the
audited financial statements at that date but does not include
all of the information and notes
required by generally accepted accounting principles in the United
States for complete financial statements.
|
NEKTAR
THERAPEUTICS
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands, except
per share information)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
|
June
30,
|
|
June 30,
|
|
|
|
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
Product sales and
royalty revenue
|
$
5,891
|
|
$
10,675
|
|
$
11,808
|
|
$
22,810
|
Non-cash royalty
revenue related to sale of future royalties
|
4,837
|
|
3,828
|
|
10,610
|
|
8,221
|
License, collaboration
and other revenue
|
17,785
|
|
19,359
|
|
25,866
|
|
25,835
|
Total
revenue
|
|
|
28,513
|
|
33,862
|
|
48,284
|
|
56,866
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
5,108
|
|
5,011
|
|
13,015
|
|
16,672
|
Research and
development
|
|
36,702
|
|
52,230
|
|
75,040
|
|
97,848
|
General and
administrative
|
|
9,619
|
|
9,226
|
|
19,547
|
|
20,057
|
Total operating costs
and expenses
|
51,429
|
|
66,467
|
|
107,602
|
|
134,577
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
(22,916)
|
|
(32,605)
|
|
(59,318)
|
|
(77,711)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-operating income
(expense):
|
|
|
|
|
|
|
|
Interest
income
|
|
|
132
|
|
209
|
|
266
|
|
523
|
Interest
expense
|
|
|
(4,488)
|
|
(4,656)
|
|
(9,021)
|
|
(9,301)
|
Non-cash interest
expense on liability related to sale of future royalties
|
(5,134)
|
|
(5,485)
|
|
(10,521)
|
|
(11,028)
|
Other income
(expense), net
|
|
(36)
|
|
(6)
|
|
142
|
|
123
|
Total non-operating
expense, net
|
(9,526)
|
|
(9,938)
|
|
(19,134)
|
|
(19,683)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before provision
for income taxes
|
(32,442)
|
|
(42,543)
|
|
(78,452)
|
|
(97,394)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
195
|
|
205
|
|
386
|
|
417
|
Net loss
|
|
|
|
$
(32,637)
|
|
$
(42,748)
|
|
$
(78,838)
|
|
$
(97,811)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
loss per share
|
$
(0.26)
|
|
$
(0.37)
|
|
$
(0.63)
|
|
$
(0.85)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding used in computing basic and diluted net loss per
share
|
127,040
|
|
115,544
|
|
125,301
|
|
115,427
|
NEKTAR
THERAPEUTICS
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June
30,
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net
loss
|
|
|
|
|
|
|
|
$
(78,838)
|
|
$
(97,811)
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
|
Non-cash royalty
revenue related to sale of future royalties
|
|
|
|
(10,610)
|
|
(8,221)
|
Non-cash interest
expense on liability related to sale of future
royalties
|
|
10,521
|
|
11,028
|
Stock-based
compensation
|
8,525
|
|
8,601
|
Depreciation and
amortization
|
6,519
|
|
7,281
|
Other non-cash
transactions
|
865
|
|
159
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts receivable,
net
|
(818)
|
|
(236)
|
Inventory
|
(659)
|
|
(2,210)
|
Other
assets
|
738
|
|
5,508
|
Accounts
payable
|
(1,818)
|
|
2,631
|
Accrued
compensation
|
(2,868)
|
|
2,314
|
Accrued
expenses
|
(314)
|
|
3,280
|
Accrued clinical
trial expenses
|
(3,697)
|
|
(565)
|
Interest
payable
|
-
|
|
(166)
|
Deferred
revenue
|
7,636
|
|
(2,818)
|
Other
liabilities
|
(6,557)
|
|
(1,223)
|
Net cash used in
operating activities
|
(71,375)
|
|
(72,448)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Maturities of
investments
|
118,777
|
|
200,477
|
Purchases of
investments
|
(166,496)
|
|
(109,400)
|
Purchases of property
and equipment
|
(5,192)
|
|
(794)
|
Net cash (used in)
provided by investing activities
|
(52,911)
|
|
90,283
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
Payment of capital
lease obligations
|
(1,650)
|
|
(1,466)
|
Repayment of proceeds
from sale of future royalties
|
(7,000)
|
|
(3,000)
|
Issuance of common
stock, net of issuance costs
|
116,601
|
|
-
|
Proceeds from shares
issued under equity compensation plans
|
7,961
|
|
2,621
|
Net cash provided by
(used in) financing activities
|
115,912
|
|
(1,845)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rates on cash and cash equivalents
|
6
|
|
5
|
Net (decrease)
increase in cash and cash equivalents
|
(8,368)
|
|
15,995
|
Cash and cash
equivalents at beginning of period
|
39,067
|
|
25,437
|
Cash and cash
equivalents at end of period
|
$
30,699
|
|
$
41,432
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
Cash paid for
interest
|
|
|
|
|
|
$
8,622
|
|
$
9,070
|
SOURCE Nektar Therapeutics