Enanta Pharmaceuticals, Inc., (NASDAQ:ENTA), a research and
development-focused biotechnology company dedicated to creating
small molecule drugs in the infectious disease field, today
reported financial results for its fiscal third quarter ended June
30, 2014.
Fiscal Third Quarter Ended June 30, 2014 Financial
Results
Revenue for the three months ended June 30, 2014 was $42.1
million, compared to $1.6 million for the three months ended June
30, 2013. For the nine months ended June 30, 2014, revenue was
$45.1 million, compared to $30.7 million for the same period in
2013. The changes in revenue for the three and nine month periods
were primarily related to milestone payments totaling $40 million
received during the three months ended June 30, 2014 related to the
U.S. and European regulatory filings for AbbVie’s investigational
hepatitis C virus (HCV) regimen containing the protease inhibitor
ABT-450 from its collaboration with Enanta. Enanta’s milestone and
other payments from collaborations have varied significantly from
period to period, and are expected to continue to do so.
Research and development expenses totaled $4.6 million for the
three months ended June 30, 2014, compared to $4.0 million for the
three months ended June 30, 2013. For the nine months ended June
30, 2014, research and development expenses were $13.5 million,
compared to $12.5 million for the same period in 2013. The
increases in the three and nine month periods are primarily due to
increased spending on Enanta’s proprietary research programs.
General and administrative expenses totaled $2.6 million for the
three months ended June 30, 2014, compared to $1.8 million for the
three months ended June 30, 2013. For the nine months ended June
30, 2014, general and administrative expenses totaled $7.3 million,
compared to $4.4 million for the same period in 2013. The increases
in the three and nine month periods primarily reflect increases in
stock-based compensation expense, due principally to increases in
Enanta’s stock price, as well as additional expenses incurred as a
result of operating as a public company.
Net income for the three months ended June 30, 2014 was $50.1
million, compared to a net loss of $4.1 million for the same period
in 2013. For the nine months ended June 30, 2014, net income was
$39.5 million, compared to net income of $14.1 million for the same
period in 2013. The increase in net income during the three and
nine month periods ended June 30, 2014 was due to $40 million in
milestone payments from AbbVie and the reversal of the entire
valuation allowance related to Enanta’s deferred tax assets which
resulted in an income tax benefit of $15.3 million, as well as the
offset of $7.6 million of income taxes that would have otherwise
been accrued.
Cash, cash equivalents and marketable securities totaled $137.6
million at June 30, 2014. This compares to $112.2 million at
September 30, 2013. Enanta expects that its current cash, cash
equivalents and marketable securities will be sufficient to meet
its anticipated cash requirements for at least the next 24
months.
“Enanta has built a valuable infectious disease pipeline over
the past several years,” commented Jay R. Luly, Ph.D., President
and Chief Executive Officer. “Regulatory approval is expected in
the U.S. and in Europe for our protease inhibitor ABT-450 as part
of AbbVie’s HCV combination regimen, our NS5A inhibitor EDP-239 has
advanced into combination studies with Novartis and we continue our
research on our proprietary cyclophilin and nucleotide inhibitors.
Outside of HCV, our compound EDP-788 for MRSA has advanced in its
clinical trials and we continue to explore other disease areas
where we can apply our internal drug discovery and development
expertise.”
Program and Business Review
- Enanta received a total of $40 million
of milestone payments from AbbVie for its U.S. and European
regulatory filings related to the ABT-450 containing regimen for
HCV. The New Drug Application (NDA) to the U.S. Food and Drug
Administration and Marketing Authorization Applications (MAA) to
the European Medicines Agency were both accepted for review and
received priority review and accelerated assessment designations,
respectively.
- Preliminary results from the
TURQUOISE-I study were presented in a late breaking oral
presentation (oral abstract MOAB0104LB) during the 20th
International AIDS Conference in Melbourne, Australia. This
interferon-free study conducted by AbbVie evaluated the safety and
efficacy of the three direct-acting antiviral (3D) regimen of
ABT-450/r/ombitasvir, dasabuvir, and ribavirin in patients
co-infected with hepatitis C and HIV-1. Results demonstrated:
- SVR12 rate of 93.5% was achieved with
12 weeks of 3D + RBV
- SVR4 rate of 96.9% was achieved with 24
weeks of 3D + RBV
- 3D + RBV co-administered with
atazanavir or raltegravir ART was well-tolerated with no
treatment-emergent serious adverse events and no patient
discontinuations due to adverse events
- Enanta’s NS5A inhibitor EDP-239
advanced into drug combination studies in healthy volunteers with
alisporivir, Novartis’s cyclophilin inhibitor. EDP-239 is being
studied in collaboration with Novartis on NS5A inhibitors for the
treatment of HCV infection.
- EDP-788, Enanta’s Bicyclolide
antibiotic for methicillin-resistant Staphylococcus aureus (MRSA),
has begun a phase 1b multiple ascending dose study in up to 32
healthy volunteers.
Upcoming Events and Presentations
Enanta management will participate in the following upcoming
investor conferences:
- Sept. 3, FBR Healthcare Conference,
Boston, MA
- Sept. 4, Baird 2014 Healthcare
Conference, New York
- Sept. 8, Morgan Stanley Global
Healthcare Conference, New York
About Enanta
Enanta Pharmaceuticals is a research and development-focused
biotechnology company that uses its robust chemistry-driven
approach and drug discovery capabilities to create small molecule
drugs in the infectious disease field. Enanta is discovering, and
in some cases, developing novel inhibitors designed for use against
the hepatitis C virus (HCV). These inhibitors include members of
three direct acting antiviral (DAA) inhibitor classes – protease
(partnered with AbbVie), NS5A (partnered with Novartis) and
nucleotide polymerase – as well as a host-targeted antiviral (HTA)
inhibitor class targeted against cyclophilin. Additionally, Enanta
has created a new class of antibiotics, called Bicyclolides, for
the treatment of multi-drug resistant bacteria, with a focus on
developing an intravenous and oral treatment for hospital and
community MRSA (methicillin-resistant Staphylococcus aureus)
infections.
ENANTA PHARMACEUTICALS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(unaudited)(in thousands, except per share
amounts)
Three Months EndedJune
30,
Nine Months EndedJune
30,
2014 2013 2014 2013 Revenue $
42,051 $ 1,649 $ 45,104 $ 30,704 Operating expenses
Research and development
4,553 4,039 13,538 12,541
General and administrative
2,603 1,788 7,255 4,433
Total operating expenses
7,156 5,827 20,793 16,974
Income (loss) from operations 34,895 (4,178 ) 24,311 13,730 Other
income (expense), net 36 40 47
340 Net income (loss) before income taxes 34,931 (4,138 )
24,358 14,070 Income tax benefit 15,122 -
15,122 - Net income (loss) $ 50,053 $ (4,138 )
$ 39,480 $ 14,070 Accretion of redeemable convertible
preferred stock to redemption value - - - (2,526 ) Net income
attributable to participating securities - -
- (13,670 ) Net income (loss) attributable to common
stockholders $ 50,053 $ (4,138 ) $ 39,480 $ (2,126 )
Net income (loss) per share attributable to common stockholders
Basic
$ 2.70 $ (0.23 ) $ 2.16 $ (0.30 )
Diluted
$ 2.61 $ (0.23 ) $ 2.06 $ (0.30 ) Weighted average common shares
outstanding
Basic
18,529 17,820 18,276 7,053
Diluted
19,203 17,820 19,168 7,053
ENANTA PHARMACEUTICALS,
INC.CONDENSED CONSOLIDATED BALANCE
SHEETS(unaudited)(in thousands)
June 30,2014
September 30,2013
Assets Current assets
Cash and cash equivalents
$ 26,374 $ 8,859
Short-term marketable securities
69,513 92,621
Accounts receivable
399 808
Unbilled receivables
2,259 784
Deferred tax assets
11,183 -
Prepaid expenses and other current
assets
1,950 1,641
Total current assets
111,678 104,713 Property and equipment, net 1,551 1,121 Long-term
marketable securities 41,700 10,703 Deferred tax assets 4,149 -
Restricted cash 436 436
Total assets
$ 159,514 $ 116,973
Liabilities, Preferred Stock and
Stockholders' Equity Current liabilities
Accounts payable
$ 1,284 $ 1,481
Accrued expenses
2,984 3,035
Deferred revenue
- 10
Total current liabilities
4,268 4,526 Warrant liability 1,675 1,620 Series 1 nonconvertible
preferred stock 213 - Other long-term liabilities 405
359
Total liabilities
6,561 6,505 Total stockholders' equity 152,953
110,468
Total liabilities, preferred stock and
stockholders' equity
$ 159,514 $ 116,973
Forward Looking Statements Disclaimer
This press release contains forward-looking statements,
including statements with respect to the prospects for approval of
AbbVie’s HCV treatment regimen containing ABT-450 for use in the
U.S. and Europe, the prospects for EDP-239 and Enanta’s internal
programs, and the projected sufficiency of Enanta’s cash equivalent
resources and marketable securities. Statements that are not
historical facts are based on management’s current expectations,
estimates, forecasts and projections about Enanta’s business and
the industry in which it operates and management’s beliefs and
assumptions. The statements contained in this release are not
guarantees of future performance and involve certain risks,
uncertainties and assumptions, which are difficult to predict.
Therefore, actual outcomes and results may differ materially from
what is expressed in such forward-looking statements. Important
factors and risks that may affect actual results include: Enanta’s
reliance on AbbVie’s planned regulatory approval and
commercialization efforts for its treatment regimens containing
ABT-450 or any additional collaboration protease inhibitor;
regulatory actions affecting approval of treatment regimens
containing ABT-450 or any additional protease inhibitors; clinical
and commercial development of competitive product candidates of
others for HCV and other viruses; Enanta’s lack of clinical
development experience; Enanta’s need to attract and retain senior
management and key scientific personnel; Enanta’s need to obtain
and maintain patent protection for its product candidates and avoid
potential infringement of the intellectual property rights of
others; and other risk factors described or referred to in “Risk
Factors” in Enanta’s most recent Form 10-K for the fiscal year
ended September 30, 2013 and other periodic reports filed more
recently with the Securities and Exchange Commission. Enanta
cautions investors not to place undue reliance on the
forward-looking statements contained in this release. These
statements speak only as of the date of this release, and Enanta
undertakes no obligation to update or revise these statements,
except as may be required by law.
Investors:Enanta Pharmaceuticals, Inc.Carol Miceli,
617-607-0710cmiceli@enanta.comorMedia:MacDougall Biomedical
CommunicationsKari Watson, 781-235-3060kwatson@macbiocom.com
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