SAN DIEGO, Aug. 8, 2016 /PRNewswire/ -- Arena
Pharmaceuticals, Inc. (Nasdaq: ARNA), today reported financial
results for the second quarter ended June
30, 2016, and provided a corporate update.
"We are continuing to successfully execute the turnaround and
transition of Arena from a historically research-oriented
organization to a high performing clinical development organization
focused on maximizing the value of our assets – this includes
re-orienting priorities, building requisite capabilities and
establishing key linkages to the physician community," said
Amit Munshi, Arena's President and
CEO. "With our three proprietary clinical programs, we are
committed to developing our pipeline in a time and cost conscious
manner to deliver first, or best-in-class, compounds. Our
strong quarter-end cash position of $122.0
million in addition to the workforce reductions supports the
advancement of our clinical stage programs."
"In addition to our on-going Phase 2 programs for etrasimod and
ralinepag, we are excited to announce that APD371 will be evaluated
in a Phase 2 program for the treatment of pain associated with
Crohn's disease, which we expect to initiate early in 2017.
We are working to unlock the value in our portfolio, including
these three Phase 2 programs, as well as supporting our multiple
collaborations which span a marketed product, a Phase 2 program, a
Phase 1 program and a preclinical program," Munshi concluded.
Clinical Update
- Etrasimod (APD334)
- Etrasimod is currently being evaluated in a Phase 2 clinical
trial for ulcerative colitis.
- The Company expects Phase 2 data in the fourth quarter of
2017.
- The United States Adopted Names (USAN) Council has approved the
nonproprietary name etrasimod for APD334.
- APD371
- Favorable results were reported in April from a Phase 1b
multiple-ascending dose clinical trial of APD371, a highly
selective and full agonist of the cannabinoid 2 (CB2)
receptor.
- APD371 will next be evaluated in a Phase 2 clinical trial for
the treatment of pain associated with Crohn's disease. The
Company anticipates initiating the trial in early 2017.
- Ralinepag (APD811)
- Ralinepag is currently being evaluated in a Phase 2 clinical
trial for pulmonary arterial hypertension (PAH).
- The Company expects Phase 2 data mid-year 2017.
Collaborations Update
- Eisai, Ltd. and Eisai Inc.
- In connection with two regulatory approvals subsequent to the
second quarter, Arena will receive $11.0
million in milestone payments from Eisai:
- On July 14, we announced the
Federal Commission for the Protection Against Sanitary Risk
(COFEPRIS) approved lorcaserin HCl in Mexico. The product
will be sold under the brand name VENESPRI®.
- On July 19, we announced the U.S.
Food and Drug Administration (FDA) approved the New Drug
Application (NDA) for BELVIQ XR® (lorcaserin HCl) CIV
extended-release 20 mg tablets.
Corporate Update
- Kevin R. Lind appointed as
Executive Vice President and Chief Financial Officer, effective
June 15, 2016.
- U.S. workforce reduction announced, primarily in the areas of
discovery research, manufacturing and administrative functions to
focus the organization on its proprietary clinical pipeline.
The Company estimates a reduced annualized cash expenditure of
approximately $23-$25 million.
In July, the Company also reduced the workforce in Arena GmbH,
primarily in the areas of manufacturing and G&A. The
Company estimates this will result in an additional reduced annual
cash expenditure of approximately $2.1
million.
Second Quarter 2016 Financial Results
- Revenues totaled $9.5 million,
including $4.3 million in net product
sales of BELVIQ
- Research and development expenses totaled $18.5 million
- General and administrative expenses totaled $8.5 million
- Restructuring charges totaled $6.1
million, including non-cash charges of $1.0 million
- Net loss was $27.2 million or
$0.11 per share
- At June 30, 2016, cash and cash
equivalents totaled $122.0 million
and approximately 243 million shares of Arena common stock were
outstanding
2016 Corporate Guidance Update
- R&D expenses between $78 to $84
million, including non-cash expenses of approximately
$9 million
- G&A expenses between $27 to $33
million, including non-cash expenses of approximately
$7 million
- The Company believes the costs reductions and strategic shift
in priorities will allow it to manage its cash through completion
of Phase 2 clinical trials for its three internal clinical stage
programs.
Conference Call & Webcast Information
The Company will host a conference call and live webcast with the
investment community today, Monday, August
8, 2016 at 4:30 p.m. ET to
discuss the financial results and provide a corporate update.
When: August 8, 2016, 4:30 p.m. ET
Dial-in: (877) 643-7155 (United
States) or (914) 495-8552 (International)
Conference ID: Arena Pharmaceuticals Second Quarter 2016 Conference
Call
Please join the conference call at least 10 minutes early to
register.
You can access the live webcast under the investor relations
section of Arena's website at: www.arenapharma.com.
A replay of the conference call will be archived under the
investor relations section of Arena's website at www.arenapharm.com
for 30 days shortly after the call.
About Arena Pharmaceuticals
We are a biopharmaceutical company focused on developing novel,
small molecule drugs across a range of therapeutic areas. We
have three primary proprietary clinical programs: Etrasimod
(APD334) in Phase 2 evaluation for ulcerative colitis, APD371
entering Phase 2 evaluation for the treatment of pain associated
with Crohn's disease, and ralinepag (APD811) in Phase 2 evaluation
for pulmonary arterial hypertension (PAH). Additionally, we
have collaborations with four pharmaceutical companies: Eisai Co.,
Ltd. and Eisai Inc. (commercial stage), Axovant Sciences Ltd.
(Phase 2 candidate), Ildong Pharmaceuticals Co., Ltd. (Phase 1
candidate), and Boehringer Ingelheim International GmbH
(preclinical candidate).
Our US operations are located in San
Diego, California. Our primary clinical operations are
located in Zug, Switzerland, and
our commercial manufacturing for BELVIQ is located in Zofingen,
Switzerland.
Forward-Looking Statements
Certain statements in this press release are forward-looking
statements that involve a number of risks and uncertainties. Such
forward-looking statements include statements about the turnaround
and transition; developing Arena's pipeline, including ongoing
Phase 2 programs for etrasimod and ralinepag and a new Phase 2
program for APD371; Arena's workforce reductions and shift in
priorities, including the expected reduced cash expenditures; the
expected timing of clinical data [and initiating a new trial];
receiving milestone payments; managing cash through completion of
Phase 2 trials for three programs; Arena's focus, plans and
strategy; the advancement and potential of Arena's clinical
programs and collaborations; and activities with Eisai and other
collaborators. For such statements, Arena claims the protection of
the Private Securities Litigation Reform Act of 1995. Actual events
or results may differ materially from Arena's expectations. Factors
that could cause actual results to differ materially from the
forward-looking statements include, but are not limited to, the
following: the risk that the cost and other negative effects
related to the reduction of Arena's workforce may be greater than
anticipated; the risk that Arena may not realize the benefits
expected from the workforce reduction or other cost control
measures; risks related to developing and commercializing drugs;
the risk that we may need additional funds to advance all of our
programs, and you and others may not agree with the manner we
allocate our resources; cash and revenues generated from BELVIQ,
including the impact of competition; the risk that Arena's revenues
are based in part on estimates, judgment and accounting policies,
and incorrect estimates or disagreement regarding estimates or
accounting policies may result in changes to Arena's guidance or
previously reported results; the timing and outcome of regulatory
review is uncertain, and lorcaserin may not be approved for
marketing in a different formulation or in any other territory;
regulatory decisions in one territory may impact other regulatory
decisions and Arena's business prospects; government and commercial
reimbursement and pricing decisions; risks related to relying on
collaborative arrangements; the timing and receipt of payments and
fees, if any, from collaborators; the entry into or modification or
termination of collaborative arrangements; unexpected or
unfavorable new data; nonclinical and clinical data is voluminous
and detailed, and regulatory agencies may interpret or weigh the
importance of data differently and reach different conclusions than
Arena or others, request additional information, have additional
recommendations or change their guidance or requirements before or
after approval; data and other information related to any of
Arena's research and development may not meet regulatory
requirements or otherwise be sufficient for (or Arena or a
collaborator may not pursue) further research and development,
regulatory review or approval or continued marketing; Arena's and
third parties' intellectual property rights; the timing, success
and cost of Arena's research and development and related strategy
and decisions; results of clinical trials and other studies are
subject to different interpretations and may not be predictive of
future results; clinical trials and other studies may not proceed
at the time or in the manner expected or at all; having adequate
funds; and satisfactory resolution of litigation or other
disagreements with others. Additional factors that could cause
actual results to differ materially from those stated or implied by
Arena's forward-looking statements are disclosed in Arena's filings
with the Securities and Exchange Commission. These forward-looking
statements represent Arena's judgment as of the time of this
release. Arena disclaims any intent or obligation to update these
forward-looking statements, other than as may be required under
applicable law.
Contact:
Kevin R.
Lind, Chief Financial Officer
klind@arenapharm.com
858.453.7200 x1716
(Tables Follow)
Arena
Pharmaceuticals, Inc.
Condensed
Consolidated Statements of Operations
(In thousands, except
per share amounts)
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
(unaudited)
|
|
(unaudited)
|
|
Revenues
|
|
|
|
|
|
|
|
|
Net product
sales
|
$
4,263
|
|
$
4,285
|
|
$
7,781
|
|
$
10,903
|
|
Other Eisai
collaborative revenue
|
1,975
|
|
3,213
|
|
5,201
|
|
5,349
|
|
Toll
manufacturing
|
1,025
|
|
1,390
|
|
2,048
|
|
1,736
|
|
Other collaborative
revenue
|
2,249
|
|
293
|
|
4,329
|
|
3,449
|
|
Total
revenues
|
9,512
|
|
9,181
|
|
19,359
|
|
21,437
|
|
|
|
|
|
|
|
|
|
|
Operating Costs
& Expenses
|
|
|
|
|
|
|
|
|
Cost of product
sales
|
851
|
|
1,303
|
|
3,279
|
|
4,494
|
|
Cost of toll
manufacturing
|
1,758
|
|
1,812
|
|
2,946
|
|
2,214
|
|
Research &
development
|
18,546
|
|
24,201
|
|
37,048
|
|
46,169
|
|
General &
administrative
|
8,465
|
|
8,844
|
|
15,389
|
|
17,283
|
|
Restructuring
charges
|
6,115
|
|
0
|
|
6,115
|
|
0
|
|
Total
operating costs & expenses
|
35,735
|
|
36,160
|
|
64,777
|
|
70,160
|
|
|
|
|
|
|
|
|
|
|
Interest &
Other Income (Expense)
|
|
|
|
|
|
|
|
|
Interest
income
|
105
|
|
34
|
|
193
|
|
68
|
|
Interest
expense
|
(1,619)
|
|
(1,754)
|
|
(3,298)
|
|
(3,450)
|
|
Gain (loss) from
valuation of derivative liabilities
|
0
|
|
1,171
|
|
0
|
|
(378)
|
|
Other
|
554
|
|
721
|
|
(208)
|
|
1,381
|
|
Total interest
& other income (expense), net
|
(960)
|
|
172
|
|
(3,313)
|
|
(2,379)
|
|
Net loss
|
$
(27,183)
|
|
$
(26,807)
|
|
$
(48,731)
|
|
$
(51,102)
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share:
|
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.11)
|
|
$
(0.11)
|
|
$
(0.20)
|
|
$
(0.21)
|
|
Diluted
|
$
(0.11)
|
|
$
(0.11)
|
|
$
(0.20)
|
|
$
(0.21)
|
|
|
|
|
|
|
|
|
|
|
Shares used in
calculating net loss per share:
|
|
|
|
|
|
|
|
|
Basic
|
243,076
|
|
242,067
|
|
242,976
|
|
238,903
|
|
Diluted
|
243,076
|
|
242,067
|
|
242,976
|
|
238,903
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Arena
Pharmaceuticals, Inc.
|
Condensed
Consolidated Balance Sheet Data
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2016
|
|
December 31,
2015
|
|
|
(unaudited)
|
|
1
|
|
Assets
|
|
|
|
|
Cash &
cash equivalents
|
$ 121,986
|
|
$ 156,184
|
|
Accounts
receivable
|
3,343
|
|
4,934
|
|
Inventory
|
9,472
|
|
9,502
|
|
Prepaid
expenses & other current assets
|
4,971
|
|
4,218
|
|
Land, property
& equipment, net
|
68,190
|
|
71,828
|
|
Intangibles
& other non-current assets
|
9,885
|
|
10,126
|
|
Total
assets
|
$ 217,847
|
|
$ 256,792
|
|
|
|
|
|
|
Liabilities &
Stockholders' Equity
|
|
|
|
|
Accounts
payable & accrued liabilities
|
$
31,348
|
|
$
25,493
|
|
Total deferred
revenues
|
105,281
|
|
109,042
|
|
Total lease
financing obligations & other long-term liabilities
|
67,659
|
|
68,715
|
|
Total
stockholders' equity
|
13,559
|
|
53,542
|
|
Total
liabilities & stockholders' equity
|
$ 217,847
|
|
$ 256,792
|
|
|
1
The Condensed Consolidated Balance Sheet Data has been derived from
the audited financial statements as of that date.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/arena-pharmaceuticals-reports-second-quarter-2016-financial-results-and-provides-corporate-update-300310556.html
SOURCE Arena Pharmaceuticals, Inc.