Momenta Pharmaceuticals, Inc. (Nasdaq:MNTA) today reported its
financial results for the fourth quarter and year ended December
31, 2016.
For the fourth quarter of 2016, the Company
reported total revenues of $34.2 million, including $15.8 million
in product revenues from Sandoz’s sales of Glatopa® 20 mg
(glatiramer acetate injection), net of a deduction of $3.6 million
for reimbursement to Sandoz of the Company’s share of
Glatopa-related legal expenses. For the year ended December 31,
2016, the Company reported total revenues of $109.6 million,
including $74.6 million in product revenues from Sandoz’s sales of
Glatopa 20 mg, net a deduction of $3.6 million for reimbursement to
Sandoz of the Company’s share of Glatopa-related legal expenses.
Momenta reported net income of $41.5 million, or $0.60 per share
for the fourth quarter of 2016, compared to a net loss of $(29.2)
million, or $(0.43) per share for the same period in 2015. For the
year ended December 31, 2016, the Company reported a net loss of
$(21.0) million, or $(0.31) per share compared to a net loss of
$(83.3) million, or $(1.32) per share for the same period in 2015.
At December 31, 2016, the Company had cash, cash equivalents, and
marketable securities of $353.2 million compared to $350.0 million
at December 31, 2015.
“In 2016, Momenta reported significant advances
across our portfolio. In early January 2017, we announced a
significant research collaboration and license agreement with CSL
for M230, our SIF3 novel therapeutic product candidate, and
potential future Fc multimer programs. We also announced an
agreement with Shire for the early return of full rights to the
M923 program, our biosimilar HUMIRA® candidate. We were also
pleased by the District Court’s decision to invalidate the four
method of use patents litigated by Teva to block Sandoz’s potential
launch of our Glatopa 40 mg product,” said Craig A. Wheeler,
President and Chief Executive Officer of Momenta Pharmaceuticals.
“We are fully committed to work with Sandoz and Pfizer to resolve
the recently announced warning letter. With the potential for the
approval and launch of Glatopa 40 mg and with multiple data
readouts expected across our biosimilar and novel programs this
year, we believe 2017 could be a transformative year for
Momenta.”
Fourth Quarter Highlights and Recent
Events
Complex Generics:
Glatopa 20 mg: First
FDA-approved, substitutable generic daily COPAXONE® 20 mg for
patients with relapsing forms of multiple sclerosis developed in
collaboration with Sandoz
- On February 17, 2017, the Company announced that Sandoz’s
contracted fill/finish manufacturing partner for Glatopa, Pfizer,
has received an FDA warning letter. The FDA warning letter does not
restrict the production or shipment of the Glatopa 20 mg product
that is currently marketed by Sandoz in the United States.
- In the fourth quarter of 2016, Momenta recorded $15.8 million
in product revenues from Sandoz’s Glatopa 20 mg sales. For the year
ended December 31, 2016, the Company recorded $74.6 million in
product revenues from Sandoz’s sales of Glatopa 20 mg reflecting
$78.2 million in profit share.
Glatopa 40 mg: Designed to be a
generic version of three-times-a-week COPAXONE® 40 mg (glatiramer
acetate injection) for patients with relapsing forms of multiple
sclerosis developed in collaboration with Sandoz
- The Abbreviated New Drug Application (ANDA) submitted by Sandoz
for a three-times-a-week generic COPAXONE 40 mg is under U.S. Food
and Drug Administration (FDA) review. An approval of the
application may be dependent on the satisfactory resolution of the
compliance observations stated in the FDA warning letter issued to
Pfizer, the contracted fill/finish manufacturer for Glatopa. The
Company believes that an approval in the first quarter of 2017 is
unlikely.
- On January 30, 2017, the United States District Court for the
District of Delaware found Teva Pharmaceutical’s U.S. Patent Nos.
8,232,250; 8,399,413; 8,969,302; and 9,155,776 for COPAXONE 40 mg
invalid as obvious over the prior art. Teva has appealed the
decision to U.S. Court of Appeals for the Federal Circuit (CAFC).
The Company expects a decision from the CAFC will be issued within
12 to 18 months and plans to aggressively defend against Teva’s
appeal.
- Teva has asserted infringement claims under two additional
patents (U.S. Patent Nos. 9,155,775 (“the ‘775 patent)” and
9,402,874 (“the ‘874 patent”), which claims Momenta believes to be
invalid, not infringed and unenforceable. On February 17,
2017, Teva filed a motion for preliminary injunctive relief under
the ‘775 patent seeking to enjoin a launch of Glatopa 40 mg. The
Company plans to vigorously defend its freedom to launch and oppose
these actions. As part of this defense, the Company has filed an
action in the United States Court for the District of Delaware
seeking a declaratory judgment of invalidity, non-infringement and
unenforceability for the ‘775 patent.
Biosimilars:
M923: a fully-owned proposed
biosimilar to HUMIRA® (adalimumab)
- In December 2016, Momenta signed an early termination of the
collaboration agreement with Baxalta, a wholly-owned subsidiary of
Shire plc, to develop and commercialize M923. In January, the
Company received a one-time asset return payment of $51.2 million
from Shire intended to fund Momenta’s estimated costs of performing
the development activities that would have been performed by Shire
through the original termination date of September 27, 2017.
- In November 2016, the Company announced positive Phase 3
top-line results of M923 in patients with moderate-to-severe
chronic plaque psoriasis. Momenta is targeting mid-2017 for the
first submission for marketing approval of M923. Subject to
marketing approval and patent considerations, the Company expects
first commercial launch of M923 to be as early as 2020
timeframe.
M834: a proposed biosimilar to
ORENCIA® (abatacept) being developed in collaboration with
Mylan
- In November 2016, Momenta and its collaboration partner Mylan
announced the initiation of a Phase 1 clinical trial for M834. The
companies plan to report top-line data from the Phase 1 trial in
the second half of 2017.
- In November 2016, Momenta received a $25.0 million development
milestone payment from Mylan to be applied toward the funding of
Mylan’s 50% share of collaboration expenses.
- On December 22, 2016, the U.S. Patent and Trademark Office’s
Patent Trial and Appeal Board issued their decision upholding the
validity of U.S. Patent No. 8,476,239, related to Bristol Myers
Squibb’s ORENCIA (abatacept) product following the Company’s Inter
Partes Review challenging this patent. The Company is considering
its options for appeal to the U.S. Court of Appeals for the Federal
Circuit.
M710: a biosimilar candidate
being developed in collaboration with Mylan
- In December 2016, in connection with a joint decision to
continue development of M710, Momenta received a $35.0 million
milestone payment from Mylan to be applied toward the funding of
Mylan’s 50% share of collaboration expenses.
Novel Drugs for Autoimmune
Indications:
Momenta’s novel autoimmune portfolio includes
two recombinant molecules: M230, a Selective Immunomodulator of Fc
receptors (SIF3) and M281, an anti-FcRn monoclonal antibody.
Momenta is also developing a hyper-sialylated IVIg (M254) as a
potential high potency version of IVIg that is currently in
pre-clinical development.
M230 (SIF3): a Selective
Immunomodulator of Fc receptors
- On January 5, 2017, the Company announced that it has entered
into a worldwide license agreement and an exclusive research
collaboration with CSL to develop and commercialize Fc multimer
proteins, including Momenta’s M230, which is expected to enter the
clinic in 2017. In addition to advancing M230, the agreement
initiates a research collaboration to develop additional Fc
multimer proteins that may originate from Momenta’s or CSL’s
research.
- On February 17, 2017 the applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act (HSR Act) in
connection with license agreement and research collaboration with
CSL expired. Under the agreement, CSL is obligated to pay Momenta a
$50 million upfront cash payment within 30 days of the effective
date of February 17, 2017.
M281 (anti-FcRn): a fully human
monoclonal antibody (mAb) targeting the neonatal Fc receptor
(FcRn)
- The Company has successfully completed the Phase 1 single
ascending dose study in healthy volunteers. In the SAD portion of
the study, a single dose of 30 mg/kg achieved up to 80% reduction
of circulating IgG antibodies. M281 was well-tolerated and to date
no serious adverse events have been observed. The multiple
ascending dose portion of the study was initiated in January
2017.
- The Company plans to report the full data from the single and
multiple ascending dose portions of the study in the second half of
2017.
Fourth Quarter and Year End 2016
Financial Results
Total revenues for the fourth quarter of 2016
were $34.2 million compared to $22.4 million for the same period in
2015. For the fourth quarter of 2016, the Company recorded $15.8
million in product revenues from Sandoz’s sales of Glatopa 20 mg
reflecting $19.4 million in profit share, net of a deduction of
$3.6 million for reimbursement to Sandoz of the Company's share of
Glatopa-related legal expenses, compared to $15.6 million for the
same period in 2015. Research and development revenue for the
fourth quarter of 2016 of $18.4 million includes $14.6 million of
collaborative revenue representing the remaining unamortized
balance of the $40.0 million upfront and license payments from
Baxalta. Research and development revenue for the same period in
2015 of $4.6 million includes $2.4 million of amortization of
Baxalta’s upfront and license payments.
For the year ended December 31, 2016, total
revenues were $109.6 million compared to $89.7 million for 2015.
Total revenues for full year 2016 include $74.6 million in product
revenue earned from Sandoz’s sales of Glatopa 20 mg, net a
deduction of $3.6 million in reimbursement to Sandoz of the
Company’s share of Glatopa-related legal expenses, compared to
$43.4 million in product revenue earned from Sandoz’s sales of
Glatopa 20 mg for the full year 2015, net of a deduction of $9.1
million in reimbursement to Sandoz of the Company’s share of
Glatopa-related legal expenses. The increase in product revenues of
$31.2 million, or 72%, from 2015 to 2016 was primarily due to a
higher number of Glatopa 20 mg units sold. Research and development
revenue for 2016 of $35.0 million includes $22.0 million of
collaborative revenue representing the remaining unamortized
balance of the $40.0 million upfront and license payments from
Baxalta. Research and development revenue for 2015 of $41.1 million
includes $20.0 million in milestone payments earned upon sole FDA
approval and first commercial sale of Glatopa 20 mg.
Research and development expenses for the fourth
quarter of 2016 were $26.4 million, compared to $37.6 million for
the same period in 2015. The decrease of $11.2 million, or 30%,
from the 2015 period was due to decreases of $6.8 million for
Mylan’s 50% share of biosimilar collaboration costs, and $3.3
million due to the discontinuation of the necuparanib development
program. For the year ended December 31, 2016, research and
development expenses were $119.9 million compared to $126.0 million
for the year ended 2015. The decrease of $6.1 million, or 5%, in
research and development expenses from 2015 to 2016 resulted from a
decrease of $26.5 million for Mylan’s 50% share of biosimilar
collaboration costs, partially offset by increases of $11.9 million
in third-party research, process development, and nonclinical study
costs to advance our biosimilar and novel autoimmune programs; $4.9
million in personnel-related expenses, of which $2.5 million is due
to increased headcount and $2.4 million is driven by stock
compensation; and $2.9 million in costs for the Phase 1 clinical
studies of M281 and M834.
General and administrative expenses for the
quarter ended December 31, 2016 were $18.2 million, compared with
$14.4 million for the same period in 2015. The increase of $3.8
million, or 26%, from the 2015 period was primarily due to
increases of $1.5 million in personnel-related expenses and $2.1
million in legal and professional fees. For the year ended December
31, 2016, general and administrative expenses were $64.5 million,
compared to $48.1 million for the year ended 2015. The increase of
$16.4 million, or 34%, resulted from increases of $9.6 million
in personnel-related expenses, of which $5.1 million is due to
increased headcount and $4.5 million is driven by stock
compensation, and $7.2 million in professional fees primarily for
legal, consulting and recruiting costs. The increases were offset
by a decrease of $1.3 million for Mylan’s 50% share of biosimilar
collaboration costs.
Other Income for the fourth quarter of 2016 was
$51.9 million, compared to $0.4 million for the same period in
2015. Other Income in the fourth quarter of 2016 includes $51.2
million from the M923 Asset Return and Termination Agreement with
Baxalta, a wholly-owned subsidiary of Shire plc. The $51.2 million
payment, received in January of 2017, is intended to fund Momenta’s
estimated costs of performing the development activities that would
have been performed by Shire through the original termination date
of September 27, 2017. For the full year 2016 Other Income was
$53.7 million compared to $1.1 million in 2015.
At December 31, 2016, the Company had cash, cash
equivalents, and marketable securities of $353.2 million compared
to $350.0 million at December 31, 2015. The year-end cash balance
excludes the receipt of a $51.2 million payment from Shire in
January 2017 and a $50.0 million upfront payment from CSL that the
Company expects to receive in the first quarter of 2017. Current
cash balances are expected to be primarily used to fund the
Company’s pipeline, operations and research activities.
Financial Guidance
Momenta provides non-GAAP operating expense
guidance, which it believes can enhance an overall understanding of
its financial performance when considered together with GAAP
figures. Refer to the section of this press release below entitled
“Non-GAAP Financial Information and Other Disclosures” for further
discussion of this subject.
Non-GAAP operating expense is total operating
expenses (which excludes collaboration expenses reimbursable by
Mylan), less stock-based compensation expense and collaboration
expenses incurred by the Company that are reimbursable by Sandoz.
Today, Momenta provided non-GAAP operating expense guidance of
approximately $200 - $240 million for 2017. This guidance
includes approximately $55 million of spending on M923 that will
now be included in the Company’s 2017 operating expenses. Of the
$55 million, $51 million of the expense has already been paid by
Shire as part of the termination agreement. Non-GAAP operating
expense in the first quarter of 2017 is expected to be $50 - $60
million. The quarterly recognition of collaborative revenues
under the Company’s collaboration with Mylan is expected to
be approximately $2.0 million per quarter. Based on the Asset
Return and Termination Agreement with Baxalta, the Company
recognized the full balance of its residual deferred revenues from
that agreement in the fourth quarter of 2016 and will not recognize
revenues from that agreement on a go-forward basis.
Non-GAAP Financial Information and Other
Disclosures
Momenta uses a non-GAAP financial measure,
non-GAAP operating expense, to provide operating expense guidance.
Momenta believes this non-GAAP financial measure is useful to
investors because it provides greater transparency regarding
Momenta’s operating performance and excludes non-cash stock
compensation expense and is net of collaborative reimbursement
revenues from Sandoz. This non-GAAP financial measure should not be
considered an alternative to GAAP total operating expense and
should not be considered a measure of Momenta’s liquidity. Non-GAAP
financial measures should not be considered as substitutes for
measures calculated in accordance with GAAP and should only be used
to supplement an understanding of Momenta’s operating results as
reported under GAAP. Momenta has not provided a GAAP reconciliation
for its forward-looking non-GAAP annual operating expense because
Momenta cannot reliably predict without unreasonable efforts the
timing or amount of the factors that substantially contribute to
the projection of stock compensation expense, which is excluded
from the forward-looking non-GAAP financial measure. The Company
has provided the anticipated reconciling information that is
available without unreasonable effort in the section of this press
release above entitled “Financial Guidance.”
Conference Call Information
Management will host a conference call and
webcast today at 8:00 am ET to discuss these results and provide an
update on the company. A live webcast of the conference call may be
accessed on the “Investors” section of the company’s website,
www.momentapharma.com. Please go to the site at least 15 minutes
prior to the call in order to register, download, and install any
necessary software. An archived version of the webcast will be
posted on the Momenta website approximately two hours after the
call.
To access the call you may also dial (877)
224-9084 (domestic) or (720) 545-0022 (international) prior to the
scheduled conference call time and provide the access code
62528080. A replay of the call will be available approximately two
hours after the conclusion of the call and will be accessible
through February 28, 2017. To access the replay, please dial
(855) 859-2056 (domestic) or (404) 537-3406 (international) and
provide the access code 62528080.
About Momenta
Momenta Pharmaceuticals is a biotechnology
company specializing in the detailed structural analysis of complex
drugs and is headquartered in Cambridge, MA. Momenta is
applying its technology to the development of generic versions of
complex drugs, biosimilar and potentially interchangeable
biologics, and to the discovery and development of novel
therapeutics for autoimmune indications.
To receive additional information about Momenta,
please visit the website at www.momentapharma.com, which does
not form a part of this press release.
Our logo, trademarks, and service marks are the
property of Momenta Pharmaceuticals, Inc. All other trade names,
trademarks, or service marks are property of their respective
owners.
Forward Looking Statements
Statements in this press release regarding
management's future expectations, beliefs, intentions, goals,
strategies, plans or prospects, are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995, including but not limited to statements about the timing
of the regulatory approval and launch of our product candidates,
including Glatopa 40 mg; the Company’s ability to meet its
development and strategic goals; the dependence of an approval of
the Glatopa 40 mg ANDA on resolution of the compliance observations
in the FDA warning letter issued to Pfizer; expectations regarding
long-term growth and sustainability; future operating expenses;
program development and collaboration plans; timing of regulatory
submissions; timing of clinical trials and the availability and
announcement of clinical data; timing of patent litigation and
other patent-related proceedings and decisions related to such
litigation and proceedings; assessment of patents that are the
subject of patent litigation; ability to generate value from our
product candidates; and expectations regarding quarterly
recognition of consideration and revenues under the Company’s
collaborations and how the Company plans to use its current cash
balances. Forward-looking statements may be identified by
words such as “believe,” “continue,” “could,” “expect,” “guidance,”
“may,” “plan,” “potential,” “target,” “will” and other similar
words or expressions, or the negative of these words or similar
words or expressions. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors, including
those referred to under the section “Risk Factors” in the Company's
Quarterly Report on Form 10-Q for the quarter ended September
30, 2016, filed with the Securities and Exchange
Commission, as well as other documents that may be filed by the
Company from time to time with the Securities and Exchange
Commission. As a result of such risks, uncertainties and
factors, the Company's actual results may differ materially from
any future results, performance or achievements discussed in or
implied by the forward-looking statements contained
herein. The Company is providing the information in this press
release as of this date and assumes no obligations to update the
information included in this press release or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
MOMENTA PHARMACEUTICALS, INC. |
Unaudited Condensed Consolidated Balance
Sheets |
(in thousands) |
|
|
|
December 31, 2016 |
|
December 31, 2015 |
Assets |
|
|
|
|
Cash, cash equivalents
and marketable securities |
|
$ |
353,151 |
|
$ |
350,044 |
Collaboration
receivable |
|
70,242 |
|
21,185 |
Restricted cash |
|
21,761 |
|
20,660 |
Other assets |
|
32,583 |
|
29,151 |
Total
assets |
|
$ |
477,737 |
|
$ |
421,040 |
Liabilities and
Stockholders’ Equity |
|
|
|
|
Current
liabilities |
|
$ |
70,676 |
|
$ |
38,782 |
Deferred revenue, net
of current portion |
|
31,360 |
|
12,213 |
Other long-term
liabilities |
|
3,793 |
|
69 |
Stockholders’
equity |
|
371,908 |
|
369,976 |
Total
liabilities and stockholders’ equity |
|
$ |
477,737 |
|
$ |
421,040 |
|
|
|
|
|
|
|
MOMENTA PHARMACEUTICALS, INC. |
|
Unaudited Condensed Statements of Operations
and Comprehensive Income (Loss) |
|
(in thousands, except per share amounts) |
|
|
|
|
|
Three Months |
|
Year |
|
|
|
|
Ended December 31, |
|
Ended December 31, |
|
|
|
|
2016 |
|
2015 |
|
2016 |
|
2015 |
|
Collaboration
revenues: |
|
|
|
|
|
|
|
|
|
|
Product
revenue |
|
$ |
15,817 |
|
$ |
17,810 |
|
$ |
74,648 |
|
$ |
48,503 |
|
Research
and development revenue |
|
18,378 |
|
4,583 |
|
34,971 |
|
41,147 |
|
Total
collaboration revenue |
|
34,195 |
|
22,393 |
|
109,619 |
|
89,650 |
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
Research
and development* |
|
26,382 |
|
37,568 |
|
119,880 |
|
126,033 |
|
General
and administrative* |
|
18,165 |
|
14,373 |
|
64,466 |
|
48,051 |
|
Total
operating expenses |
|
44,547 |
|
51,941 |
|
184,346 |
|
174,084 |
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
(10,352 |
) |
(29,548 |
) |
(74,727 |
) |
(84,434 |
) |
|
|
|
|
|
|
|
|
|
|
Other income |
|
51,891 |
|
384 |
|
53,724 |
|
1,121 |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
41,539 |
|
$ |
(29,164 |
) |
$ |
(21,003 |
) |
$ |
(83,313 |
) |
|
|
|
|
|
|
|
|
|
|
Basic net income (loss)
per share |
|
$ |
0.60 |
|
$ |
(0.43 |
) |
$ |
(0.31 |
) |
$ |
(1.32 |
) |
Diluted net income
(loss) per share |
|
$ |
0.60 |
|
$ |
(0.43 |
) |
$ |
(0.31 |
) |
$ |
(1.32 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted average shares
used in computing basic net income (loss) per share |
|
69,003 |
|
68,138 |
|
68,656 |
|
63,130 |
|
Weighted average shares
used in computing diluted net income (loss) per share |
|
69,362 |
|
68,138 |
|
68,656 |
|
63,130 |
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss) |
|
$ |
41,375 |
|
$ |
(29,176 |
) |
$ |
(20,921 |
) |
$ |
(83,293 |
) |
|
* Non-cash
share-based compensation expense included in operating expenses is
as follows: |
|
|
Research and
development |
|
$ |
1,132 |
|
$ |
2,114 |
|
$ |
7,558 |
|
$ |
5,145 |
|
|
General and
administrative |
|
$ |
2,434 |
|
$ |
2,539 |
|
$ |
10,764 |
|
$ |
6,295 |
|
|
INVESTOR CONTACT:
Sarah Carmody
Momenta Pharmaceuticals
1-617-395-5189
IR@momentapharma.com
MEDIA CONTACT:
Karen Sharma
MacDougall Biomedical Communications
1-781-235-3060
Momenta@macbiocom.com
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