Chiasma Provides Corporate Update and Reports Third Quarter 2016 Results
November 09 2016 - 4:05PM
Chiasma, Inc. (NASDAQ:CHMA), a biopharmaceutical company focused on
improving the lives of patients with rare and serious chronic
diseases, today provided a corporate update and reported financial
results for the third quarter ended September 30, 2016.
“Chiasma is committed to the development of new treatment
options for acromegaly and we are currently applying all of our
resources to the development of Mycapssa® (octreotide) capsules for
patients suffering from acromegaly, a rare and debilitating
disease,” said Mark J. Fitzpatrick, president and chief executive
officer of Chiasma. “We continue to explore regulatory paths
forward to potentially enable approval in the U.S. while enrollment
of the MPOWERED™ Phase 3 trial of Mycapssa progresses in support of
our planned Marketing Authorization Application (MAA) in
Europe.”
Key Corporate Highlights:
- Mycapssa NDA: As previously announced,
Chiasma received a Complete Response Letter (CRL) from the Food and
Drug Administration (FDA) on April 15,
2016 regarding its New Drug Application (NDA) for Mycapssa.
FDA expressed concerns regarding certain aspects of our single-arm,
open-label Phase 3 clinical trial and strongly recommended that we
conduct a randomized, double-blind and controlled trial that
enrolls patients from the United States and is of sufficiently long
duration to ensure that control of disease activity is stable at
the time point selected for the primary efficacy assessment. In
addition, the FDA advised that, during a site inspection, certain
deficiencies were conveyed to the representative of one of our
suppliers that would need to be resolved before approval.
This feedback was reiterated in an End of Review Meeting with FDA
during the second quarter, and in the minutes of which meeting
where the FDA also introduced the concept that some of its concerns
could potentially be addressed through a placebo controlled
design. Chiasma acknowledges this feedback and continues to
evaluate various paths forward to potentially secure approval in
the U.S. for Mycapssa.
- August Restructuring: During the third
quarter, the company further reduced its workforce by approximately
44%, primarily in the company’s research and general and
administrative functions, to lower its operating expenses and
extend its cash runway.
- CEO Transition: Effective October 1, 2016, Mr.
Fitzpatrick was promoted from Chief Financial Officer to Chief
Executive Officer and he continues to serve as our Principle
Financial Officer.
- VP Finance Appointment: Effective
November 10, 2016, Mr. Drew Enamait was promoted from Director,
Corporate Controller to VP, Finance and Administration and
Principle Accounting Officer. Mr. Enamait earned a Certified
Public Accountant certificate in 1999 and has over 20 years of
professional experience in financial positions in both large and
small companies.
Third Quarter 2016 Financial Results and Updated Cash
Guidance
- Marketing, G&A Expenses: Marketing,
general and administrative expenses were $3.9 million for the
quarter ended September 30, 2016, compared to $4.8 million for the
same period of 2015. The decrease was primarily due to the
June 2016 reduction in force of substantially all of our commercial
personnel and the corresponding reduction in pre-commercial
activity expenditures following the CRL. This decrease was
partially offset by greater compensation-related expenses
associated with our expanded U.S. office as well as increased
professional and consulting fees associated with being a public
company.
- R&D Expenses: Research and development
expenses were $4.5 million for the quarter ended September 30,
2016, compared to $4.4 million for the same period of 2015.
The increase was primarily due to our ongoing Phase 3 clinical
trial of octreotide capsules for the treatment of acromegaly to
support the submission of an MAA to the European Medicines Agency
(EMA).
- Restructuring Charges: Chiasma recorded a
restructuring charge of approximately $1.0 million for the quarter
ended September 30, 2016 which was attributable to the
restructuring plan announced in August 2016.
- Net Loss: For the quarter ended September 30,
2016, Chiasma’s net loss attributable to common stockholders was
($9.4) million, or ($0.38) per basic share. This compares to
a net loss of ($9.4) million, or ($0.46) per basic share, for the
same period of 2015. The basic share amounts outstanding for
the quarter ended September 30, 2016 included the common stock that
was issued upon conversion of Chiasma’s redeemable preferred stock
in connection with the company’s July 2015 initial public offering
(IPO). Redeemable preferred stock outstanding was excluded
from this calculation in periods before the IPO.
- Cash Position: Cash, cash equivalents and
marketable securities as of September 30, 2016 were $99.4 million,
compared to $115.6 million as of June 30, 2016, primarily
reflecting the company’s third-quarter operating expenditures and
restructuring-related payments. The Company expects to end
2016 with between $90 million and $92 million in cash, cash
equivalents and marketable securities. Additionally, the Company
expects its existing cash, cash equivalents and marketable
securities to fund its operations beyond 2018.
About Chiasma
Chiasma is focused on improving the lives of patients who face
challenges associated with their existing treatments for rare and
serious chronic diseases. Employing its Transient
Permeability Enhancer (TPE®) technology platform, Chiasma seeks to
develop oral medications that are currently available only as
injections. The company is conducting an international Phase
3 clinical trial of octreotide capsules (conditionally trade-named
“Mycapssa®”) for the maintenance treatment of adult acromegaly
patients to support a potential submission of a Marketing
Authorization Application to the European Medicines Agency.
Chiasma received a Complete Response Letter (CRL) from the U.S.
Food and Drug Administration (FDA) on April 15, 2016 regarding its
New Drug Application (NDA) for Mycapssa in the United States.
Chiasma is headquartered in the United States with a wholly owned
subsidiary in Israel. Mycapssa and TPE are registered
trademarks of Chiasma.
Forward-Looking Statements
This release contains “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995,
including, but not limited to, statements regarding the company’s
commitment to develop new treatment options to patients with
acromegaly, the company’s efforts to explore pathways to
potentially enable regulatory approval in the US, the company’s
ongoing MPOWERED Phase 3 clinical trial and planned regulatory
filings related thereto, cash guidance as of the end of 2016, and
the company’s expectation that its existing cash, cash equivalents
and marketable securities will be sufficient to fund its operations
beyond 2018. Any forward-looking statements in this press
release are based on management’s current expectations of future
events and are subject to a number of risks and uncertainties that
could cause actual results to differ materially and adversely from
those set forth in or implied by such forward-looking
statements. These risks and uncertainties include, but are
not limited to, risks associated with the regulatory review and
approval process generally; risks associated with Chiasma’s Phase 3
clinical trial to support regulatory approval of Mycapssa in the
E.U.; risks associated with Chiasma potentially conducting an
additional randomized, double-blind and controlled Phase 3 clinical
trial of Mycapssa in accordance with the FDA’s recommendation in
the CRL to support regulatory approval of Mycapssa in the United
States, including risks related to the enrollment, timing and
associated expenses of any potential trial; risks associated with
Chiasma pursuing a development pathway other than the path strongly
recommended by the FDA; risks associated with obtaining,
maintaining and protecting intellectual property; risks associated
with Chiasma’s ability to enforce its patents against infringers
and defend its patent portfolio against challenges from third
parties; the risk that octreotide capsules, if approved, will not
be successfully commercialized; the risk of competition from
currently approved therapies and from other companies developing
products for similar uses; risks associated with Chiasma’s ability
to manage operating expenses and/or obtain additional funding to
support its business activities; risks associated with Chiasma’s
dependence on third parties; and risks associated with defending
any litigation, including the risk that we incur more costs than we
expect and uncertainty involving the outcome. For a
discussion of these and other risks and uncertainties, and other
important factors, any of which could cause our actual results to
differ from those contained in the forward-looking statements, see
the section entitled “Risk Factors” in Chiasma’s Annual Report on
Form 10-K for the year ended December 31, 2015 filed with the
Securities and Exchange Commission (SEC) on March 17, 2016, and in
subsequent filings with the Securities and Exchange
Commission. All information in this press release is as of
the date of the release, and Chiasma undertakes no duty to update
this information unless required by law.
|
Chiasma,
Inc. |
Condensed Consolidated Statements of
Operations |
(amounts in thousands except share and per
share data) |
(unaudited) |
|
|
|
|
|
|
|
|
|
For the three months ended |
|
For the nine months ended |
|
September 30, 2016 |
|
September 30, 2015 |
|
September 30, 2016 |
|
September 30, 2015 |
Operating
expenses: |
|
|
|
|
|
|
|
Marketing, general and
administrative |
$ |
3,881 |
|
|
$ |
4,814 |
|
|
$ |
19,267 |
|
|
$ |
10,182 |
|
Research and development |
|
4,521 |
|
|
|
4,368 |
|
|
|
26,526 |
|
|
|
10,745 |
|
Restructuring charges |
|
1,037 |
|
|
|
- |
|
|
|
7,574 |
|
|
|
- |
|
Total operating
expenses |
|
9,439 |
|
|
|
9,182 |
|
|
|
53,367 |
|
|
|
20,927 |
|
Loss from
operations |
|
(9,439 |
) |
|
|
(9,182 |
) |
|
|
(53,367 |
) |
|
|
(20,927 |
) |
Other
expense (income), net |
|
(139 |
) |
|
|
105 |
|
|
|
(389 |
) |
|
|
303 |
|
Loss before provision
for income taxes |
|
(9,300 |
) |
|
|
(9,287 |
) |
|
|
(52,978 |
) |
|
|
(21,230 |
) |
Provision for income
taxes |
|
73 |
|
|
|
72 |
|
|
|
238 |
|
|
|
146 |
|
Net loss |
|
(9,373 |
) |
|
|
(9,359 |
) |
|
|
(53,216 |
) |
|
|
(21,376 |
) |
Accretion of redeemable
convertible preferred stock |
|
- |
|
|
|
(31 |
) |
|
|
- |
|
|
|
(318 |
) |
Net loss attributable
to common stockholders |
$ |
(9,373 |
) |
|
$ |
(9,390 |
) |
|
$ |
(53,216 |
) |
|
$ |
(21,694 |
) |
|
|
|
|
|
|
|
|
Earnings per share
attributable to common stockholders |
|
|
|
|
|
|
|
Basic |
$ |
(0.38 |
) |
|
$ |
(0.46 |
) |
|
$ |
(2.19 |
) |
|
$ |
(3.17 |
) |
Diluted |
$ |
(0.38 |
) |
|
$ |
(0.46 |
) |
|
$ |
(2.19 |
) |
|
$ |
(3.17 |
) |
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
Basic |
|
24,357,730 |
|
|
|
20,280,385 |
|
|
|
24,305,916 |
|
|
|
6,837,272 |
|
Diluted |
|
24,357,730 |
|
|
|
20,280,385 |
|
|
|
24,305,916 |
|
|
|
6,837,272 |
|
|
|
|
|
|
|
|
|
Chiasma,
Inc. |
|
Condensed Consolidated Balance Sheets
Information |
|
(amounts in
thousands) |
|
(unaudited) |
|
|
|
|
|
|
|
September 30, 2016 |
|
December 31, 2015 |
|
|
|
|
|
|
Cash and cash
equivalents |
$ |
28,475 |
|
|
$ |
41,039 |
|
|
Marketable
securities |
|
70,883 |
|
|
|
107,715 |
|
|
Prepaid expenses and
other current assets |
|
2,244 |
|
|
|
2,331 |
|
|
Property and equipment,
net |
|
2,415 |
|
|
|
676 |
|
|
Other assets |
|
1,489 |
|
|
|
1,347 |
|
|
Total assets |
$ |
105,506 |
|
|
$ |
153,108 |
|
|
|
|
|
|
|
Accounts
payable |
$ |
1,160 |
|
|
$ |
157 |
|
|
Accrued expenses |
|
5,579 |
|
|
|
4,657 |
|
|
Other current
liabilities |
|
1,877 |
|
|
|
1,700 |
|
|
Long-term
liabilities |
|
3,827 |
|
|
|
3,778 |
|
|
Total liabilities |
|
12,443 |
|
|
|
10,292 |
|
|
Total stockholders'
equity |
|
93,063 |
|
|
|
142,816 |
|
|
Total liabilities and
stockholders' equity |
$ |
105,506 |
|
|
$ |
153,108 |
|
|
|
|
|
|
|
Contact
Cammy Duong
MacDougall Biomedical Communications
(781) 591-3443
cduong@macbiocom.com
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