Company Provides 2017 Financial Guidance
and Expected Milestones
Cytokinetics, Inc. (Nasdaq:CYTK) reported total revenues for
the fourth quarter of 2016 were $33.1 million, compared to $9.8
million, during the same period in 2015. Net income for the fourth
quarter was $7.2 million, or $0.18 and $0.16 per basic and diluted
share, respectively. This is compared to a net loss for the same
period in 2015 of $9.2 million, or $0.24 per basic and diluted
share. As of December 31, 2016, cash, cash equivalents and
investments totaled $163.9 million. The 2016 year-end cash
and cash equivalents does not include $100 million received from a
royalty monetization deal with Royalty Pharma that closed in
February 2017.
“2016 culminated with another productive quarter
marked by progress and momentum across our pipeline of late-stage
muscle biology-directed drug candidates,” said Robert I. Blum,
Cytokinetics’ President and Chief Executive Officer. “With two drug
candidates in Phase 3 clinical trials and a third advancing in
multiple Phase 2 clinical trials, we are executing well against our
Vision 2020 strategic initiative, alone and in collaboration with
our partners. We expect 2017 to be a pivotal year highlighted by
the expected results from VITALITY-ALS, our Phase 3 trial of
tirasemtiv, as well as key data from our Phase 2 trial of
CK-2127107 in patients with spinal muscular atrophy.”
Recent Highlights
Cardiac Muscle Program
omecamtiv mecarbil
- Announced the start of GALACTIC-HF (Global
Approach to Lowering
Adverse Cardiac Outcomes
Through Improving
Contractility in Heart
Failure), the Phase 3 cardiovascular outcomes
clinical trial of omecamtiv mecarbil which is being conducted by
Amgen, in collaboration with Cytokinetics.
- Announced additional results from COSMIC-HF
(Chronic Oral
Study of Myosin Activation to
Increase Contractility in
Heart Failure), a Phase 2 trial
evaluating omecamtiv mecarbil in patients with chronic heart
failure, showing that omecamtiv mecarbil improved left atrial (LA)
structure and function in patients with chronic heart failure with
reduced systolic function. The results were presented in a Clinical
Poster Session at the American Heart Association’s Scientific
Sessions 2016 in New Orleans.
- Completed enrollment of a Phase 2 clinical trial of omecamtiv
mecarbil in Japanese patients with chronic heart failure.
Skeletal Muscle Program
tirasemtiv
- Announced the first patient has been enrolled in VIGOR-ALS
(Ventilatory Investigations in
Global Open-Label
Research in ALS), an open-label
extension clinical trial designed to assess the long-term safety
and tolerability of tirasemtiv, in patients with ALS who have
completed their participation in VITALITY-ALS.
- Announced new data at the 27th International Symposium on
ALS/MND in Dublin, Ireland including:- Baseline characteristics
from VITALITY-ALS showed patients enrolled in VITALITY-ALS are
similar to those from BENEFIT-ALS and other recently conducted
clinical trials in patients with ALS.- Results from the first part
of a research collaboration to refine and prospectively validate a
computer model developed by Origent Data Sciences to predict the
course of ALS disease progression analyzing data from the placebo
groups of earlier clinical trials in patients with ALS (including
BENEFIT-ALS, Cytokinetics’ Phase 2b clinical trial of tirasemtiv)
and the open-access Pro-Act database. The analyses showed that the
Gradient Boosting Machine (GBM) algorithm was the optimal model to
predict slow vital capacity (SVC) at times subsequent to baseline
and that forced vital capacity (FVC) records could be used to
predict slow vital capacity (SVC) scores of ALS patients using this
machine learning technique.- Results of an international physician
survey on the use of non-invasive ventilation (NIV) in the
treatment of ALS presented by Terry Heiman-Patterson, M.D.,
Director of the Center for Neurodegenerative Disorders, and
Professor of the Department of Neurology at the Lewis Katz School
of Medicine at Temple University, revealed similarities in best
practices for initiating NIV in North America and Europe, and
differences in the time to initiation.
CK-2127107
- Continued enrollment of Cohort 1 in the Phase 2 clinical trial
of CK-2127107 in patients with spinal muscular atrophy (SMA),
conducted by Cytokinetics in collaboration with Astellas.
- Continued enrollment in a Phase 2 clinical trial of CK-2127107
in patients with COPD, conducted by Astellas in collaboration with
Cytokinetics.
Pre-Clinical Research
- Continued research activities under our joint research program
with Amgen directed to the discovery of next-generation cardiac
muscle activators and under our joint research program with
Astellas directed to the discovery of next-generation skeletal
muscle activators. In addition, company scientists continued
independent research activities directed to our other muscle
biology programs.
- Announced the publication of preclinical data characterizing a
smooth muscle myosin inhibitor that induces smooth muscle
relaxation. The manuscript titled, “Highly Selective Inhibition of
Myosin Motors Provides the Basis of Potential Therapeutic
Application,” published in PNAS, Proceedings of the National
Academy of Sciences, illustrates a mechanism of action with
potential relevance for diseases of smooth muscle
hypercontractility such as asthma and chronic obstructive pulmonary
disease.
Corporate
- Received a $26.7 million milestone payment from Amgen
coincident to the start of GALACTIC-HF (Global
Approach to Lowering
Adverse Cardiac Outcomes
Through Improving
Contractility in Heart
Failure), the Phase 3 cardiovascular outcomes
clinical trial of omecamtiv mecarbil which is being conducted by
Amgen in collaboration with Cytokinetics.
- Announced Cytokinetics has been selected for addition to the
Nasdaq Biotechnology Index (NBI) as part of the annual re-ranking
of the NBI.
- Announced that Cytokinetics has agreed to sell to Royalty
Pharma a 4.5% royalty on potential worldwide sales of omecamtiv
mecarbil for $90 million and $10 million of Cytokinetics common
stock.
- Announced that Cytokinetics agreed to exercise its option under
its collaboration agreement with Amgen to co-invest $40
million in the Phase 3 development program of omecamtiv
mecarbil. As a result, Cytokinetics is eligible to receive an
incremental royalty of up to 4% on increasing worldwide sales
of omecamtiv mecarbil outside of Japan. Exercising
its option and co-funding will afford Cytokinetics the right to
co-promote omecamtiv mecarbil in institutional care
settings in North America, with reimbursement by Amgen for certain
sales force activities.
Financials
Revenues for the fourth quarter of 2016 were
$33.1 million, compared to $9.8 million during the same period in
2015. Revenues for the fourth quarter of 2016 included
$26.0 million from our collaboration with Amgen, and $3.6 million
of research and development revenues and $3.2 million of license
revenues from our collaboration with Astellas, and $0.3 million in
research and development revenues from our collaboration with The
ALS Association (ALSA). Revenues from our collaboration with Amgen
included $26.7 million in a milestone payment, and $0.6 million in
research and development revenue, partially offset by a payment of
$1.3 million related to the option to co-fund a Phase 3 clinical
trial for an increased royalty percentage. Revenues for the same
period in 2015 were comprised of $5.1 million of license revenues
and $4.0 million of research and development revenues from our
collaboration with Astellas, and $0.6 million of research and
development revenues from our collaboration with Amgen.
Total research and development (R&D)
expenses for the fourth quarter of 2016 were $18.8 million,
compared to $13.2 million for the same period in 2015. The $5.6
million increase in R&D expenses for the fourth quarter of
2016, compared with the same period in 2015, was primarily due to
an increase of $4.0 million in outsourced clinical costs mainly
associated with VITALITY-ALS, our ongoing Phase 3 trial of
tirasemtiv, an increase of $1.2 million in personnel related
expenses due to increased headcount costs and increased non-cash
stock compensation expense, and an increase of $0.3 million in
laboratory expenses, partially offset by a decrease of $0.3 million
in outsourced pre-clinical costs.
Total general and administrative (G&A)
expenses for the fourth quarter of 2016 were $6.7 million compared
to $5.5 million for the same period in 2015. The $1.2 million
increase in G&A expenses for the fourth quarter of 2016,
compared to the same period in 2015, was primarily due to an
increase of $0.8 million in personnel related expenses due to
increased headcount and non-cash stock compensation expense and an
increase of $0.2 million in outsourced costs related to commercial
development, recruitment, consulting, and patent legal fees.
Revenues for the twelve months ended December
31, 2016 were $106.4 million, compared to $28.7 million for the
same period in 2015. Revenues for the twelve months of 2016
included $62.2 million of license revenues, $13.1 million of
research and development revenue, and $2.0 million of milestone
payments from our collaboration with Astellas, and $27.9 million
from our collaboration Amgen, and $1.1 million in research and
development revenues from our collaboration with ALSA. Revenues
from our collaboration with Amgen included $26.7 million in a
milestone payment, and $2.5 million in research and development
revenue, partially offset by a payment of $1.3 million related to
the option to co-fund a Phase 3 clinical trial for an increased
royalty percentage. Revenues for the same period in 2015 included
$13.9 million of license revenues and $12.2 million of research and
development revenues from our collaboration with Astellas, and $2.5
million of research and development revenues from our collaboration
with Amgen.
Total R&D expenses for the twelve months
ended December 31, 2016 were $59.9 million, compared to $46.4
million for the same period in 2015. The $13.5 million increase in
R&D expenses for the twelve months of 2016, over the same
period in 2015, was primarily due to an increase of $12.1 million
in outsourced clinical costs, $4.5 million in personnel related
expenses and non-cash stock compensation expense, and $0.8 million
in outsourced research costs, partially offset by a decrease of
$4.2 million in outsourced preclinical costs mainly associated with
clinical manufacturing activities. The increase in outsourced
clinical costs was comprised of an increase of $16.6 million in
outsourced clinical costs mainly associated with VITALITY-ALS
offset by a $4.5 million litigation settlement in June 2016 from a
contract research organization for BENEFIT-ALS, our Phase 2
clinical trial of tirasemtiv which was concluded in 2014.
Total G&A expenses for the twelve months
ended December 31, 2016 were $27.8 million, compared to $19.7
million for the same period in 2015. The $8.1 million increase in
G&A spending in the twelve months of 2016 compared to the same
period in 2015, was primarily due to $4.2 million in personnel
related expenses due to increased headcount and non-cash stock
compensation expense, an increase of $1.7 million in corporate and
patent legal fees, and an increase of $1.7 million in outsourced
costs related to commercial development, grants and sponsorships,
and accounting and finance and recruitment related costs.
Net income for the twelve months ended December
31, 2016, was $16.5 million, or $0.41 and $0.39 per basic and
diluted share, respectively, compared to a net loss of $37.5
million, or $0.97 per basic and diluted share, for the same period
in 2015.
2017 Financial Guidance
Cytokinetics also announced financial guidance
for 2017. The company anticipates cash revenue will be in the range
of $21 to $23 million, cash R&D expenses will be in the range
of $108 to $112 million, and cash G&A expenses will be in the
range of $30 to $32 million. This guidance excludes approximately
$7.0 million in unearned revenue from the 2014 amendment of our
collaboration with Astellas, which will be recognized in 2017 under
generally accepted accounting principles, as well as any potential
future milestones that may be achieved in accordance with our
collaboration agreements with our partner Astellas. This
guidance also excludes an estimated $8.9 million in non-cash
related operating expenses primarily related to stock compensation
expense.
2017 Corporate Milestones
Skeletal Muscle
ProgramTirasemtiv
- Expect results from VITALITY-ALS in Q4 2017.
- Expect to continue to enroll patients who complete VITALITY-ALS
into VIGOR-ALS, an open-label extension trial throughout 2017.
CK-2127107
- Expect data from a Phase 2 clinical trial of CK-2127107 in
patients with SMA in 2H 2017.
- Expect Astellas to continue enrollment in a Phase 2 clinical
trial of CK-2127107 in patients with COPD in 2017.
- Expect Astellas to begin a Phase 1b clinical trial of
CK-2127107 in elderly patients with limited mobility in 1H
2017.
- Expect to begin a Phase 2 clinical trial of CK-2127107 in
patients with ALS in mid-2017.
Cardiac Muscle Program
omecamtiv mecarbil
- Expect to continue to enroll patients with chronic heart
failure in GALACTIC-HF, our Phase 3 clinical trial of omecamtiv
mecarbil, throughout 2017.
- Expect data from a Phase 2 clinical trial of omecamtiv mecarbil
in Japanese patients with chronic heart failure in Q3 2017.
Pre-Clinical Research
- Expect to continue research activities under our joint research
program with Amgen directed to the discovery of next-generation
cardiac muscle activators and under our joint research program with
Astellas directed to the discovery of next-generation skeletal
muscle activators.
Conference Call and Webcast
Information
Members of Cytokinetics’ senior management team
will review the company’s third quarter results via a webcast and
conference call today at 4:30 PM Eastern Time. The webcast can be
accessed through the Investors & Media section of the
Cytokinetics website at www.cytokinetics.com. The live audio of
the conference call can also be accessed by telephone by
dialing either (866) 999-CYTK (2985) (United States and Canada) or
(706) 679-3078 (international) and typing in the
passcode 46421080.
An archived replay of the webcast will be
available via Cytokinetics’ website until February 23, 2017.
The replay will also be available via telephone by dialing (855)
859-2056 (United States and Canada) or (404) 537-3406
(international) and typing in the passcode 46421080 from
February 16, 2017 at 7:30 PM Eastern Time until February 23,
2017.
About Cytokinetics
Cytokinetics is a late-stage biopharmaceutical
company focused on discovering, developing and commercializing
first-in-class muscle activators as potential treatments for
debilitating diseases in which muscle performance is compromised
and/or declining. As a leader in muscle biology and the mechanics
of muscle performance, the company is developing small molecule
drug candidates specifically engineered to increase muscle function
and contractility. Cytokinetics’ lead drug candidate is tirasemtiv,
a fast skeletal troponin activator (FSTA). Tirasemtiv is the
subject of VITALITY-ALS, an international Phase 3 clinical
trial in patients with ALS. Tirasemtiv has been granted orphan drug
designation and fast track status by the U.S. Food and Drug
Administration and orphan medicinal product designation by the
European Medicines Agency. Cytokinetics is preparing for the
potential commercialization of tirasemtiv in North America and
Europe and has granted an option to Astellas Pharma Inc for
development and commercialization in other countries.
Cytokinetics is collaborating with Astellas to develop CK-2127107,
a next-generation fast skeletal muscle activator. CK-2127107
is the subject of two ongoing Phase 2 clinical trials enrolling
patients with spinal muscular atrophy and chronic obstructive
pulmonary disease. Cytokinetics is collaborating with Amgen
Inc. to develop omecamtiv mecarbil, a novel cardiac muscle
activator. Omecamtiv mecarbil is the subject of GALACTIC-HF,
an international Phase 3 clinical trial in patients with heart
failure. Amgen holds an exclusive worldwide license to
develop and commercialize omecamtiv mecarbil with a sublicense held
by Servier for commercialization in Europe and certain other
countries. Astellas holds an exclusive worldwide license to
develop and commercialize CK-2127107. Licenses held by Amgen
and Astellas are subject to Cytokinetics' specified co-development
and co-commercialization participation rights. For additional
information about Cytokinetics, visit
http://www.cytokinetics.com/.
Forward-Looking Statements
This press release contains forward-looking
statements for purposes of the Private Securities Litigation Reform
Act of 1995 (the “Act”). Cytokinetics disclaims any intent or
obligation to update these forward-looking statements, and claims
the protection of the Act’s Safe Harbor for forward-looking
statements. Examples of such statements include, but are not
limited to, statements relating to Cytokinetics’ and its partners’
research and development activities, including the initiation,
conduct, design, enrollment, progress, continuation, completion and
results of clinical trials, including VITALITY-ALS, the Phase 2
clinical trials of CK-2127107 in patients with SMA and in patients
with COPD and the Phase 2 clinical trial of omecamtiv mecarbil in
Japanese patients with chronic heart failure, the significance and
utility of preclinical study and clinical trial results, the
expected availability of clinical trial results; planned
interactions with regulatory authorities and the outcomes of such
interactions, including our discussions with the FDA regarding the
key elements of GALACTIC-HF and the potential for a SPA; the
significance and utility of preclinical study and clinical trial
results; the potential benefits of Cytokinetics’ expanded
collaboration with Astellas; the expected timing of events; and the
properties and potential benefits of Cytokinetics’ drug candidates.
Such statements are based on management's current expectations, but
actual results may differ materially due to various risks and
uncertainties, including, but not limited to further clinical
development of tirasemtiv in ALS patients which will require
significant additional funding, and Cytokinetics may be unable to
obtain such additional funding on acceptable terms, if at all; the
FDA and/or other regulatory authorities may not accept effects on
slow vital capacity as a clinical endpoint to support registration
of tirasemtiv for the treatment of ALS; potential difficulties or
delays in the development, testing, regulatory approvals for trial
commencement, progression or product sale or manufacturing, or
production of Cytokinetics’ drug candidates that could slow or
prevent clinical development or product approval, including risks
that current and past results of clinical trials or preclinical
studies may not be indicative of future clinical trials results;
patient enrollment for or conduct of clinical trials may be
difficult or delayed; the FDA or foreign regulatory agencies may
delay or limit Cytokinetics’ or its partners’ ability to conduct
clinical trials; Amgen’s and Astellas’ decisions with respect to
the design, initiation, conduct, timing and continuation of
development activities for omecamtiv mecarbil and CK-2127107,
respectively; Cytokinetics may incur unanticipated research and
development and other costs or be unable to obtain additional
financing necessary to conduct development of its products;
Cytokinetics may be unable to enter into future collaboration
agreements for its drug candidates and programs on acceptable
terms, if at all; standards of care may change, rendering
Cytokinetics’ drug candidates obsolete; and competitive products or
alternative therapies may be developed by others for the treatment
of indications Cytokinetics’ drug candidates and potential drug
candidates may target. For further information regarding these and
other risks related to Cytokinetics’ business, investors should
consult Cytokinetics’ filings with the Securities and Exchange
Commission. Forward-looking statements are not guarantees of future
performance, and Cytokinetics' actual results of operations,
financial condition and liquidity, and the development of the
industry in which it operates, may differ materially from the
forward-looking statements contained in this press release. Any
forward-looking statements that Cytokinetics makes in this press
release speak only as of the date of this press release.
Cytokinetics assumes no obligation to update its forward-looking
statements whether as a result of new information, future events or
otherwise, after the date of this press release.
|
Cytokinetics, Incorporated |
Condensed Consolidated Statements of
Operations |
(in thousands, except per share
data) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
|
2016 |
2015(1) |
|
2016 |
|
2015(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Research
and development revenues from |
|
|
|
|
|
|
|
|
|
|
|
|
related
parties, net |
$ |
29,610 |
|
$ |
4,578 |
|
$ |
42,994 |
|
$ |
14,665 |
|
Research
and development, grant and other |
|
|
|
|
|
|
|
|
|
|
|
|
revenues |
|
313 |
|
|
48 |
|
|
1,242 |
|
|
75 |
|
License
revenues from related parties |
|
3,215 |
|
|
5,131 |
|
|
62,171 |
|
|
13,918 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues |
|
33,138 |
|
|
9,757 |
|
|
106,407 |
|
|
28,658 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Research
and development |
|
18,775 |
|
|
13,249 |
|
|
59,897 |
|
|
46,398 |
|
General
and administrative |
|
6,675 |
|
|
5,529 |
|
|
27,823 |
|
|
19,667 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
operating expenses |
|
25,450 |
|
|
18,778 |
|
|
87,720 |
|
|
66,065 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
7,688 |
|
|
(9,021 |
) |
|
18,687 |
|
|
(37,407 |
) |
Interest
and other income (expense), net |
|
(531 |
) |
|
(208 |
) |
|
(2,234 |
) |
|
(94 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) |
$ |
7,157 |
|
$ |
(9,229 |
) |
$ |
16,453 |
|
$ |
(37,501 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) per share – basic |
$ |
0.18 |
|
$ |
(0.24 |
) |
$ |
0.41 |
|
$ |
(0.97 |
) |
Net
income (loss) per share – diluted |
$ |
0.16 |
|
$ |
(0.24 |
) |
$ |
0.39 |
|
$ |
(0.97 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares used in computing net income (loss) per share –
basic |
|
40,581 |
|
|
39,098 |
|
|
39,943 |
|
|
38,814 |
|
Weighted
average shares used in computing net income (loss) per share –
diluted |
|
43,696 |
|
|
39,098 |
|
|
42,561 |
|
|
38,814 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cytokinetics, Incorporated |
Condensed Consolidated Balance
Sheets |
(in thousands) |
|
|
|
|
|
|
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2016 |
|
|
2015(1) |
|
|
|
(unaudited) |
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
$ |
66,874 |
|
$ |
65,076 |
|
|
|
|
|
|
|
|
Short
term investments |
|
89,375 |
|
|
46,366 |
|
|
|
|
|
|
|
|
Related
party accounts receivable |
|
24 |
|
|
12 |
|
|
|
|
|
|
|
|
Other
current assets |
|
2,360 |
|
|
1,653 |
|
|
|
|
|
|
|
|
Total
current assets |
|
158,633 |
|
|
113,107 |
|
|
|
|
|
|
|
|
Property
and equipment, net |
|
3,637 |
|
|
1,751 |
|
|
|
|
|
|
|
|
Long-term investments |
|
7,672 |
|
|
179 |
|
|
|
|
|
|
|
|
Other
assets |
|
200 |
|
|
200 |
|
|
|
|
|
|
|
|
Total assets |
$ |
170,142 |
|
$ |
115,237 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders' equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred
revenue, current |
$ |
8,060 |
|
$ |
20,858 |
|
|
|
|
|
|
|
|
Other
current liabilities |
|
25,198 |
|
|
10,791 |
|
|
|
|
|
|
|
|
Total
current liabilities |
|
33,258 |
|
|
31,649 |
|
|
|
|
|
|
|
|
Long-term debt |
|
27,381 |
|
|
14,639 |
|
|
|
|
|
|
|
|
Deferred
revenue, non-current |
|
15,000 |
|
|
— |
|
|
|
|
|
|
|
|
Other
non-current liabilities |
|
142 |
|
|
359 |
|
|
|
|
|
|
|
|
Stockholders’ equity |
|
94,361 |
|
|
68,590 |
|
|
|
|
|
|
|
|
Total liabilities and stockholders' equity |
$ |
170,142 |
|
$ |
115,237 |
|
|
|
|
|
|
|
|
(1) Derived from the audited financial statements,
included in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2015.
Contact:
Diane Weiser
Vice President, Corporate Communications, Investor Relations
(650) 624-3000
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