Neothetics Provides Business Update and Reports Fourth Quarter 2016 Financial Results
March 23 2017 - 8:00AM
Neothetics, Inc. (NASDAQ:NEOT) today provided a business update and
reported financial results for the fourth quarter 2016.
“We are encouraged by our progress on our Phase 2 proof of
concept trial for LIPO-202 in submental fat reduction and continue
to expect top-line data in June 2017,” said Mr. Jeffrey M. Nugent,
a member of Neothetics’ Operating Committee and Board of Directors.
“We remain excited about the submental fat reduction market and
continue to believe LIPO-202 will have significant impact on this
market. The American Society of Dermatologic Surgeons’ (ASDS) 2016
consumer survey highlighted more than 70% of U.S. consumers are
bothered by excess fat on their neck or chin.”
Fourth Quarter 2016 and Recent Corporate
Highlights
- In December 2016, Neothetics initiated its Phase 2 proof of
concept trial, LIPO-202-CL-31. LIPO-202-CL-31 is a multi-center,
randomized, double-blind, placebo-controlled Phase 2 proof of
concept trial to evaluate the safety and efficacy of two doses of
LIPO-202 versus placebo for the reduction of submental bulging due
to subcutaneous fat. Subjects will be randomized 1:1:1 and
receive up to either 0.3 mcg, or 3.0 mcg dose of LIPO-202, or
placebo. Subjects will receive up to 30 subcutaneous
injections of LIPO-202 or placebo once a week for eight weeks and
follow up visits to assess safety and efficacy will occur one week
and four weeks post the last treatment. The study endpoints include
both safety and efficacy measurements. Efficacy measures will
assess improvement in the subject’s submental region as evaluated
by both the patient and clinician, covering overall subject
satisfaction and evaluation of submental fat thickness by calipers.
- In March 2017, Neothetics announced completion of subject
enrollment for its Phase 2 proof of concept trial, LIPO-202-CL-31,
for the reduction of submental subcutaneous fat. The
trial met the target enrollment of approximately 150 subjects at 12
sites across the United States.
Fourth Quarter Ended December 31, 2016 Financial
Results
Research and development expenses for the
fourth quarter of 2016 were approximately $0.9 million, compared to
$7.0 million for the same quarter in 2015. Research and development
expenses for the full year 2016 were $6.6 million, compared to
$34.4 million for full year 2015. The decrease in research
and development expenses year over year is primarily due to the
completion of the U.S. Phase 3 LIPO-202 AbCONTOUR1 and AbCONTOUR2
clinical trials and termination of the supplemental clinical trials
to support an NDA filing. We anticipate that research and
development expenses will increase over the next several quarters
due to our Phase 2 proof of concept trial for the reduction of
localized fat deposits under the chin which was initiated in
December 2016.
General and administrative expenses for the
fourth quarter of 2016 were $1.1 million, compared to $2.2 million
for the same quarter in 2015. Total general and administrative
expenses for the full year 2016 were $5.5 million, compared to $7.6
million for full year 2015. The decrease in general and
administrative expenses year over year is primarily attributable to
reduction in headcount and various legal, consulting and travel
costs in 2016.
Net loss for the fourth quarter of 2016 was
$2.0 million, or $0.14 basic and diluted net loss per share,
compared to a net loss of $9.5 million, or $0.69 basic and diluted
net loss per share, for the same period in 2015. For the full year
2016, net loss was $13.0 million, or $0.94 basic and diluted net
loss per share, compared to a net loss of $43.2 million, or $3.15
basic and diluted net loss per share for the full year 2015.
Cash and cash equivalents were $11.5 million as
of December 31, 2016 compared to $37.7 million as of December 31,
2015. In September, Neothetics repaid in full the outstanding debt
under its Loan and Security Agreement with Hercules Capital, Inc.,
in its capacity as administrative agent for itself and the other
lenders pursuant to the Loan Agreement.
About LIPO-202LIPO-202 is a proprietary,
first-in-class injectable formulation of the well-known long-acting
ß2-adrenergic receptor agonist, salmeterol xinafoate, which is an
active ingredient of FDA-approved inhaled products such as SEREVENT
DISKUS®, ADVAIR HFA® and ADVAIR DISKUS®. Our studies suggest that
salmeterol xinafoate activates ß2 -adrenergic receptors on fat
cells, triggering the body’s natural process of metabolizing stored
triglycerides (fat) resulting in a reduction in size and volume of
the fat cells in the treatment area without damage of nearby
tissues. LIPO-202 has an extremely favorable safety profile, with
little to no adverse post treatment effects. LIPO-202 is
being evaluated for the reduction of submental fat commonly
referred to as a double-chin.
About Neothetics, Inc.Neothetics is a San Diego
based clinical-stage specialty pharmaceutical company developing
therapeutics for the aesthetic market. Our initial focus is on
localized fat reduction and body contouring. Our lead product
candidate, LIPO-202, is a first-in-class injectable formulation of
the long-acting ß2-adrenergic receptor agonist, salmeterol
xinafoate, which is an active ingredient in the U.S. Food and Drug
Administration, or FDA, approved inhaled products SEREVENT DISKUS®,
ADVAIR HFA® and ADVAIR DISKUS®. For more information on Neothetics,
please visit www.neothetics.com. Neothetics, LIPO-202, LIPO-102 and
the Neothetics logo are trademarks or registered trademarks of
Neothetics, Inc. Other names and brands may be claimed as the
property of others.
Forward Looking StatementsStatements contained
in this press release regarding matters that are not historical
facts are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements
include, but are not limited to, statements regarding the
ability to develop a modified formulation of LIPO-202, timing of
conducting and obtaining results from Phase 2 trials and proof of
concept study with a modified formulation of LIPO-202, whether our
modified formulation of LIPO-202 is able to demonstrate positive
results, Neothetics’ plans to research, develop and
commercialize LIPO-202 and other product candidates, our
expectations regarding the potential market size and opportunity of
LIPO-202, as well as expected timing for reporting results from
clinical trials. Because such statements are subject to risks and
uncertainties, actual results may differ materially from those
expressed or implied by such forward-looking statements. These
forward-looking statements are based
upon Neothetics’ current expectations and involve
assumptions that may never materialize or may prove to be
incorrect. Actual results and the timing of events could differ
materially from those anticipated in such forward-looking
statements as a result of various risks and uncertainties, which
include, without limitation, risks and uncertainties associated
with clinical trials, such as the ability to timely initiate
clinical trials and enroll a sufficient number of patients on a
timely basis into clinical trials, the extent to which top-line
data is available and whether the clinical trials achieve positive
results, product development activities, obtaining regulatory
approval to commercialize LIPO-202 and other product candidates,
Neothetics’ use of cash, and the need to raise additional
funding, when needed, in order to conduct our clinical trials and
other business, the degree of market acceptance of LIPO-202 by
physicians, patients and others in the medical community, our
reliance on third parties, including third-party suppliers for
manufacturing and distribution of products, regulatory developments
in the United States and foreign countries, Neothetics’ ability to
obtain and maintain intellectual property protection for LIPO-202
and its product candidates, competition in the aesthetics industry
and other market conditions. All forward-looking statements
contained in this press release speak only as of the date on which
they were made. Neothetics undertakes no obligation to
update such statements to reflect events that occur or
circumstances that exist after the date on which they were made.
Investors should consult all of the information set forth herein
and should also refer to the risk factor disclosure set forth in
the reports and other documents the company files with
the SEC available at www.sec.gov, including without
limitation, Neothetics’ Form 10-K for the year ended December 31,
2016 and subsequent Quarterly Reports on Form 10-Q.
Neothetics, Inc. |
Condensed Statements of Operations |
(Unaudited) |
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
|
Twelve Months Ended December 31, |
|
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research
and development |
|
$ |
925,247 |
|
|
$ |
7,027,800 |
|
|
$ |
6,578,678 |
|
|
$ |
34,409,664 |
|
General
and administrative |
|
|
1,056,214 |
|
|
|
2,203,884 |
|
|
|
5,463,622 |
|
|
|
7,639,427 |
|
Total operating
expenses |
|
|
1,981,461 |
|
|
|
9,231,684 |
|
|
|
12,042,300 |
|
|
|
42,049,091 |
|
Loss from
operations |
|
|
(1,981,461 |
) |
|
|
(9,231,684 |
) |
|
|
(12,042,300 |
) |
|
|
(42,049,091 |
) |
Interest income |
|
|
9,387 |
|
|
|
5,681 |
|
|
|
59,465 |
|
|
|
26,033 |
|
Interest expense |
|
|
— |
|
|
|
(289,148 |
) |
|
|
(1,035,763 |
) |
|
|
(1,133,987 |
) |
Net loss |
|
$ |
(1,972,074 |
) |
|
$ |
(9,515,151 |
) |
|
$ |
(13,018,598 |
) |
|
$ |
(43,157,045 |
) |
Net loss per share,
basic and diluted |
|
$ |
(0.14 |
) |
|
$ |
(0.69 |
) |
|
$ |
(0.94 |
) |
|
$ |
(3.15 |
) |
Weighted average shares
used to compute basic and diluted net loss per share |
|
|
13,828,496 |
|
|
|
13,733,723 |
|
|
|
13,801,003 |
|
|
|
13,696,033 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Neothetics, Inc. |
Condensed Balance Sheets |
(Unaudited) |
|
|
|
|
|
|
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2016 |
|
|
2015 |
|
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
11,477,852 |
|
|
$ |
37,748,603 |
|
Prepaid
expenses and other current assets |
|
|
1,029,546 |
|
|
|
1,976,997 |
|
Total current
assets |
|
|
12,507,398 |
|
|
|
39,725,600 |
|
|
|
|
|
|
|
|
|
|
Restricted cash |
|
|
200,000 |
|
|
|
200,000 |
|
Property and equipment,
net |
|
|
109,320 |
|
|
|
186,372 |
|
Total assets |
|
$ |
12,816,718 |
|
|
$ |
40,111,972 |
|
Liabilities and
stockholders’ equity |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts
payable |
|
$ |
503,739 |
|
|
$ |
4,017,192 |
|
Accrued
clinical trial expenses |
|
|
359,067 |
|
|
|
1,422,810 |
|
Other
accrued expenses |
|
|
39,386 |
|
|
|
903,148 |
|
Long-term
debt, current portion |
|
|
— |
|
|
|
2,756,351 |
|
Total current
liabilities |
|
|
902,192 |
|
|
|
9,099,501 |
|
Long-term debt, net of
current portion |
|
|
— |
|
|
|
7,205,176 |
|
Stockholders’
equity: |
|
|
|
|
|
|
|
|
Preferred
stock, $0.0001 par value; 5,000,000 shares authorized; no
shares issued and outstanding |
|
|
— |
|
|
|
— |
|
Common
stock, $0.0001 par value; 300,000,000 shares authorized;
13,828,496 and 13,750,016 shares issued and outstanding at
December 31, 2016 and December 31, 2015, respectively |
|
|
1,382 |
|
|
|
1,374 |
|
Additional paid-in capital |
|
|
137,763,499 |
|
|
|
136,637,678 |
|
Accumulated deficit |
|
|
(125,850,355 |
) |
|
|
(112,831,757 |
) |
Total stockholders’
equity |
|
|
11,914,526 |
|
|
|
23,807,295 |
|
Total liabilities and
stockholders’ equity |
|
$ |
12,816,718 |
|
|
$ |
40,111,972 |
|
|
|
|
|
|
|
|
|
|
COMPANY CONTACTS:
Susan A. Knudson
Chief Financial Officer
858-500-7780
sknudson@neothetics.com
Fara Berkowitz, R.Ph, Pharm.D
Senior Director, Investor Relations and Corporate Development
646-494-1589
fberkowitz@neothetics.com
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