LEAWOOD, Kan., March 13, 2017 /PRNewswire/ -- Aratana
Therapeutics, Inc. (NASDAQ: PETX), a pet therapeutics company
focused on the licensing, development and commercialization of
innovative therapeutics for dogs and cats, announced its fourth
quarter and full year 2016 financial results. For the quarter ended
December 31, 2016, Aratana reported a
net loss of $23.3 million or
$0.64 diluted loss per share, which
includes $10.7 million in inventory
adjustments and impairment of an intangible asset. For the full
year of 2016, Aratana reported a net loss of $33.6 million or $0.95 diluted loss per share, including
impairment charges of intangible assets and inventory adjustments
totaling $15.1 million.
"In 2016, Aratana distinguished itself as a pioneer in the
animal health industry by achieving three FDA approvals for
innovative pet therapeutics in a single year," stated Steven St. Peter, M.D., President and Chief
Executive Officer of Aratana Therapeutics. "In 2017, we aim to
commercialize our approved therapeutics and continue to progress
our deep pipeline of development-stage therapeutic candidates."
Recent Updates
- GALLIPRANT® (grapiprant tablets) is approved by the
U.S. Food and Drug Administration Center for Veterinary Medicine
(CVM) for the control of pain and inflammation associated with
osteoarthritis in dogs. Galliprant was made commercially available
to veterinarians in the United
States in January 2017 and
while early into the launch, Aratana believes Galliprant has the
potential to become one of the top pet therapeutics launched in
the United States in the past
decade. In April 2016, the Company
entered a strategic collaboration with Elanco Animal Health (a
division of Eli Lilly & Co.) in which Elanco was granted
exclusive global rights outside the
United States to develop, manufacture, market, and
commercialize products based on licensed grapiprant rights and
technology, including Galliprant, and co-promotion rights with
Aratana in the United States. The
European Medicines Agency has commenced review of Aratana's
marketing authorization application for grapiprant in dogs in the
European Union and Aratana continues to anticipate marketing
authorization in 2017.
- ENTYCE® (capromorelin oral solution) is approved by
the CVM for appetite stimulation in dogs. As communicated by the
Company in February 2017, the CVM has
requested additional information regarding the proposed transfer
and scale-up of the manufacturing of Entyce, and the Company
intends to work with the CVM to address its request. The Company
continues to anticipate that Entyce will be commercially available
by late-2017.
- NOCITA® (bupivacaine liposome injectable suspension)
is approved by the CVM for local post-operative analgesia for
cranial cruciate ligament surgery in dogs. Nocita was made
commercially available in the United
States in late-2016 and the Company has been focused in the
early months on gaining access to the several hundred surgeons who
frequently perform cranial cruciate ligament surgeries.
Approximately 200 customers have placed initial orders for Nocita
and the Company's near-term commercial objectives include securing
additional re-orders from this customer base.
- The Company is evaluating capromorelin for weight management in
cats with chronic kidney disease. The pivotal field effectiveness
study and pivotal target animal safety study are both on-going
under CVM-concurred protocols.
- The Company is evaluating Nocita in other surgical procedures
in dogs to potentially expand the label. In addition, Aratana is
enrolling a pivotal field effectiveness study for post-operative
pain management in cats with results anticipated by mid-2017. The
Company recently completed a pivotal target animal safety study for
cats under CVM-concurred protocols.
- The Company recently completed enrollment of a pivotal field
safety study investigating AT-014 for the treatment of canine
osteosarcoma. The Company anticipates conditional licensure by the
Unites States Department of Agriculture (USDA) in the second half
of 2017.
- The Company's collaboration partner, VetStem BioPharma, began
enrollment in a pivotal field effectiveness study of AT-016, an
adipose-derived allogeneic stem cell therapeutic candidate for
osteoarthritis pain in dogs, and anticipates results from the study
in 2017. The Company believes VetStem plans to initiate a pivotal
target animal safety study in 2017 and is making progress on the
required Chemistry, Manufacturing and Controls (CMC) technical
section.
- The Company has approximately 50 employees in commercial
operations consisting of a chief operating officer, regional sales
leaders, national account managers, therapeutic specialists (sales
representatives), a veterinary medical director, veterinary medical
liaisons, a sales director, a sales operations director, a senior
marketing director and marketing managers, pharmacovigilance,
customer service and other operations personnel. With its build-out
of operations in 2016, in addition to its regulatory and
development capability, the Company has transitioned into a
fully-integrated pet therapeutics company.
Financial Results
The fourth quarter net loss was
$23.3 million or $0.64 diluted loss per share, compared to a net
loss of $12.9 million or $0.37 diluted loss per share for the
corresponding quarter ended December 31,
2015. For the year ended December 31,
2016, Aratana reported a net loss of $33.6 million or $0.95 diluted loss per share compared to a net
loss of $84.1 million or $2.45 diluted loss per share in 2015. In
2016, results included inventory valuation adjustment losses of
$7.2 million for
BLONTRESS®, TACTRESS®, Entyce and Galliprant.
Full year 2016 results included non-cash intangible asset
impairment charges of $7.9 million
related to Blontress, Tactress and AT-007. In 2015, Aratana
financial results included non-cash intangible asset impairment
charges of $43.4 million.
Aratana had $292 thousand in net
revenue for the quarter ended December 31,
2016, which includes Nocita sales after becoming
commercially available in late 2016, and $38.6 million in net revenue for the full year of
2016, which was generated largely from the upfront payment related
to the collaboration agreement with Elanco.
Research and development expenses totaled $9.1 million in the fourth quarter ended
December 31, 2016 compared to
$6.5 million for the quarter ended
December 31, 2015. For the full year
2016, research and development expenses totaled $30.5 million compared to $25.0 million in 2015. The increase in research
and development expenses in 2016 was due primarily to increased
milestone payments related to Galliprant, Entyce, Nocita and
AT-016, and costs related to transfer and scale-up of the
manufacturing of Entyce, which were partially offset by a decrease
in development costs after the completion of several pivotal
studies for the Company's lead programs.
Selling, general and administrative expenses totaled
$7.7 million for the fourth quarter
ended December 31, 2016 compared to
$5.8 million for the same period in
2015. For the full year 2016, selling, general and administrative
expenses were $27.3 million versus
$19.8 million for 2015. The increase
is primarily related to expanding the commercial organization and
other activities in preparation for therapeutic launches. The
selling, general and administrative expenses in 2015 were impacted
by the reversal of $1.2 million of
the remaining contingent consideration due to former shareholders
of Vet Therapeutics, Inc.
In 2015, other income included a gain of $5.1 million pertaining to the exercise of the
warrant and the subsequent sale of shares acquired by the Company
as part of a license agreement executed in March 2014.
Financial Guidance
As of December 31, 2016, Aratana had approximately
$88.7 million in cash, cash
equivalents, restricted cash and short-term investments. The
Company expects that its cash, cash equivalents and short-term
investments will fund operations and debt obligations through
March 31, 2018.
Webcast & Conference Call Details
The Company
will host a live conference call on Tuesday,
March 14, 2017 at 8:30 a.m. ET
to discuss financial results from the fourth quarter and full year
ended December 31, 2016.
Interested participants and investors may access the audio
webcast or use the conference call dial-in:
1 (866) 364-3820 (U.S.)
1 (855) 669-9657 (Canada)
1 (412) 902-4210 (International)
A replay of the fourth quarter and full year results
teleconference will be available the same day of the event by
approximately 11 a.m. ET and an audio
webcast will be accessible for 90 days in the Aratana Investor
Room. For a replay of the call, use the below dial-in and
conference ID 10101834:
1 (877) 344-7529 (U.S.)
1 (855) 669-9658 (Canada)
1 (412) 317-0088 (International)
IMPORTANT SAFETY INFORMATION
GALLIPRANT®
(grapiprant tablets) Not for use in humans. For use in dogs only.
Keep this and all medications out of reach of children and pets.
Store out of reach of dogs and other pets in a secured location in
order to prevent accidental ingestion or overdose. Do not use in
dogs that have a hypersensitivity to grapiprant. If Galliprant is
used long term, appropriate monitoring is recommended. Concomitant
use of Galliprant with other anti-inflammatory drugs, such as
COX-inhibiting NSAIDs or corticosteroids, should be avoided.
Concurrent use with other anti-inflammatory drugs or protein-bound
drugs has not been studied. The safe use of Galliprant has not been
evaluated in dogs younger than 9 months of age and less than 8 lbs
(3.6 kg), dogs used for breeding, pregnant or lactating dogs, or
dogs with cardiac disease. The most common adverse reactions were
vomiting, diarrhea, decreased appetite, and lethargy. Please see
full product label or call 1-888-545-5973 for full prescribing
information.
ENTYCE® (capromorelin oral solution) is for use in
dogs only. Do not use in breeding, pregnant or lactating dogs. Use
with caution in dogs with hepatic dysfunction or renal
insufficiency. Adverse reactions in dogs may include
diarrhea, vomiting, polydipsia, and hypersalivation. Should not be
used in dogs that have a hypersensitivity to capromorelin. Please
see the full Prescribing Information for more detail.
NOCITA® (bupivacaine liposome injectable suspension)
is for use in dogs only. Do not use in dogs younger than 5 months
of age, dogs used for breeding, or in pregnant or lactating dogs.
Do not administer by intravenous or intra-arterial injection.
Adverse reactions in dogs may include discharge from incision,
incisional inflammation and vomiting. Avoid concurrent use with
bupivacaine HCI, lidocaine or other amide local anesthetics. Please
see the full Prescribing Information for more detail.
About Aratana Therapeutics
Aratana Therapeutics is a
pet therapeutics company focused on licensing, developing and
commercializing innovative therapeutics for dogs and cats. Aratana
believes that it can leverage the investment in the human
biopharmaceutical industry to bring therapeutics to dogs and cats
in a capital and time efficient manner. The company's pipeline
includes therapeutic candidates for the potential treatment of
pain, inappetence, viral diseases, allergy, cancer and other
serious medical conditions. Aratana believes the development and
commercialization of these therapeutics will permit veterinarians
and pet owners to manage pets' medical needs safely and
effectively, resulting in longer and improved quality of life for
pets. For more information, please visit www.aratana.com.
Forward-Looking Statements Disclaimer
This press
release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. All
statements contained in this press release that do not relate to
matters of historical fact should be considered forward-looking
statements, including without limitation statements with respect to
anticipated financial performance, our ability to bring innovative
products to the market; steps necessary for and timing of
regulatory submissions and approvals of therapeutic candidates;
study, development and commercialization of therapeutics or
therapeutic candidates, including potential expansion of the label
for existing therapeutics; our belief that Galliprant has the
potential to become one of the top pet therapeutics launched in
the United States in the past
decade and statements regarding the Company's plans and
opportunities, including, without limitation, offering innovative
therapeutics that help manage pet's medical needs safely and
effectively and that result in longer and improved quality of life
for pets.
These forward-looking statements are based on management's
current expectations. These statements are neither promises nor
guarantees, but involve known and unknown risks, uncertainties and
other important factors that may cause our actual results,
performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements, including, but not limited to, the
following: our history of operating losses and our expectation that
we will continue to incur losses for the foreseeable future;
failure to obtain sufficient capital to fund our operations; risks
relating to the impairment of intangible assets, including
BLONTRESS, TACTRESS, AT-007 and AT-011; risks pertaining to
stockholder class action lawsuits; unstable market and economic
conditions; restrictions on our financial flexibility due to the
terms of our credit facility; our substantial dependence upon the
commercial success of our therapeutics; development of our biologic
therapeutic candidates is dependent upon relatively novel
technologies and uncertain regulatory pathways, and biologics may
not be commercially viable; denial or delay of regulatory approval
for our existing or future therapeutic candidates; failure of our
therapeutic candidates that receive regulatory approval to obtain
market approval or achieve commercial success; product liability
lawsuits that could cause us to incur substantial liabilities and
limit commercialization of current and future therapeutics; failure
to realize anticipated benefits of our acquisitions and
difficulties associated with integrating the acquired businesses;
development of pet therapeutics is a lengthy and expensive process
with an uncertain outcome; competition in the pet therapeutics
market, including from generic alternatives to our therapeutic
candidates, and failure to compete effectively; failure to
identify, license or acquire, develop and commercialize additional
therapeutic candidates; failure to attract and retain senior
management and key scientific personnel; our reliance on
third-party manufacturers, suppliers and partners; regulatory
restrictions on the marketing of our therapeutic candidates; our
small commercial sales organization, and any failure to create a
sales force or collaborate with third-parties to commercialize our
therapeutic candidates; difficulties in managing the growth of our
company; significant costs of being a public company; risks related
to the restatement of our financial statements for the year ended
December 31, 2013, and the
identification of a material weakness in our internal control over
financial reporting; changes in distribution channels for pet
therapeutics; consolidation of our veterinarian customers;
limitations on our ability to use our net operating loss
carryforwards; impacts of generic products; safety or efficacy
concerns with respect to our therapeutic candidates; effects of
system failures or security breaches; delay or termination of the
development of grapiprant therapeutic candidates and
commercialization of grapiprant products that may arise from
termination of or failure to perform under the collaboration
agreement and/or the co-promotion agreement with Elanco; failure to
obtain ownership of issued patents covering our therapeutic
candidates or failure to prosecute or enforce licensed patents;
failure to comply with our obligations under our license
agreements; effects of patent or other intellectual property
lawsuits; failure to protect our intellectual property; changing
patent laws and regulations; non-compliance with any legal or
regulatory requirements; litigation resulting from the misuse of
our confidential information; the uncertainty of the regulatory
approval process and the costs associated with government
regulation of our therapeutic candidates; failure to obtain
regulatory approvals in foreign jurisdictions; effects of
legislative or regulatory reform with respect to pet therapeutics;
the volatility of the price of our common stock; our status as an
emerging growth company, which could make our common stock less
attractive to investors; dilution of our common stock as a result
of future financings; the influence of certain significant
stockholders over our business; and provisions in our charter
documents and under Delaware law
could delay or prevent a change in control. These and other
important factors discussed under the caption "Risk Factors" in the
Company's Annual Report on Form 10-K filed with the Securities and
Exchange Commission, or SEC, on March 15,
2016, along with our other reports filed with the SEC could
cause actual results to differ materially from those indicated by
the forward-looking statements made in this press release. Any such
forward-looking statements represent management's estimates as of
the date of this press release. While we may elect to update such
forward-looking statements at some point in the future, we disclaim
any obligation to do so, even if subsequent events cause our views
to change, except as required under applicable law. These
forward-looking statements should not be relied upon as
representing our views as of any date subsequent to the date of
this press release.
Contacts
For investor inquiries:
Craig Tooman
ctooman@aratana.com
(913) 353-1026
For media inquiries:
Rachel Reiff
rreiff@aratana.com
(913) 353-1050
ARATANA
THERAPEUTICS, INC.
Consolidated
Statements of Operations
(Amounts in
thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Year
Ended
|
|
|
December 31,
(unaudited)
|
|
December
31,
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
Licensing and
collaboration revenue
|
|
$
|
82
|
|
$
|
—
|
|
$
|
38,233
|
|
$
|
—
|
Product
sales
|
|
|
210
|
|
|
63
|
|
|
318
|
|
|
678
|
Total
revenues
|
|
|
292
|
|
|
63
|
|
|
38,551
|
|
|
678
|
Costs and
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of product
sales
|
|
|
1,093
|
|
|
8
|
|
|
3,139
|
|
|
365
|
Royalty
expense
|
|
|
49
|
|
|
18
|
|
|
106
|
|
|
84
|
Research and
development
|
|
|
9,076
|
|
|
6,465
|
|
|
30,462
|
|
|
24,964
|
Selling, general and
administrative
|
|
|
7,719
|
|
|
5,758
|
|
|
27,342
|
|
|
19,819
|
Amortization of
intangible assets
|
|
|
98
|
|
|
95
|
|
|
379
|
|
|
1,544
|
Impairment of
intangible assets
|
|
|
5,162
|
|
|
—
|
|
|
7,942
|
|
|
43,398
|
Total costs and
expenses
|
|
|
23,197
|
|
|
12,344
|
|
|
69,370
|
|
|
90,174
|
Loss from
operations
|
|
|
(22,905)
|
|
|
(12,281)
|
|
|
(30,819)
|
|
|
(89,496)
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
109
|
|
|
42
|
|
|
385
|
|
|
189
|
Interest
expense
|
|
|
(842)
|
|
|
(924)
|
|
|
(3,396)
|
|
|
(1,585)
|
Other income (expense),
net
|
|
|
305
|
|
|
(1)
|
|
|
255
|
|
|
5,140
|
Total other income
(expense)
|
|
|
(428)
|
|
|
(883)
|
|
|
(2,756)
|
|
|
3,744
|
Loss before income
taxes
|
|
$
|
(23,333)
|
|
$
|
(13,164)
|
|
$
|
(33,575)
|
|
$
|
(85,752)
|
Income tax
benefit
|
|
|
—
|
|
|
309
|
|
|
—
|
|
|
1,698
|
Net
loss
|
|
$
|
(23,333)
|
|
$
|
(12,855)
|
|
$
|
(33,575)
|
|
$
|
(84,054)
|
Net loss per share,
basic and diluted
|
|
$
|
(0.64)
|
|
$
|
(0.37)
|
|
$
|
(0.95)
|
|
$
|
(2.45)
|
Weighted average
shares outstanding, basic and diluted
|
|
|
36,571,927
|
|
|
34,540,001
|
|
|
35,273,228
|
|
|
34,355,525
|
ARATANA
THERAPEUTICS, INC.
Consolidated
Balance Sheets
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
December 31,
2016
|
|
December 31,
2015
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash, cash equivalents
and short-term investments
|
|
$
|
88,303
|
|
$
|
86,202
|
Accounts receivable,
net and prepaid expenses and other current assets
|
|
|
2,109
|
|
|
1,511
|
Inventories
|
|
|
11,130
|
|
|
1,306
|
Total current
assets
|
|
|
101,542
|
|
|
89,019
|
Property and
equipment, net
|
|
|
1,948
|
|
|
2,555
|
Goodwill
|
|
|
39,382
|
|
|
39,781
|
Intangible assets,
net
|
|
|
7,639
|
|
|
15,067
|
Restricted
cash
|
|
|
350
|
|
|
350
|
Other long-term
assets
|
|
|
545
|
|
|
294
|
Total
assets
|
|
$
|
151,406
|
|
$
|
147,066
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts payable,
accrued expenses
|
|
$
|
13,263
|
|
$
|
5,647
|
Licensing and
collaboration commitment
|
|
|
7,000
|
|
|
—
|
Current portion –
loans payable
|
|
|
14,413
|
|
|
—
|
Other current
liabilities
|
|
|
12
|
|
|
37
|
Total current
liabilities
|
|
|
34,688
|
|
|
5,684
|
Loans payable,
net
|
|
|
25,775
|
|
|
39,710
|
Other long-term
liabilities
|
|
|
540
|
|
|
122
|
Total
liabilities
|
|
|
61,003
|
|
|
45,516
|
Total stockholders'
equity
|
|
|
90,403
|
|
|
101,550
|
Total liabilities and
stockholders' equity
|
|
$
|
151,406
|
|
$
|
147,066
|
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SOURCE Aratana Therapeutics, Inc.