SAN FRANCISCO, Nov. 7, 2017 /PRNewswire/ -- Nektar
Therapeutics (Nasdaq: NKTR) today reported its financial
results for the third quarter ended September 30, 2017.
Cash and investments in marketable securities at September
30, 2017 were $412.2 million as compared
to $389.1 million at December 31, 2016. The
cash balance includes the $150.0 million upfront payment
from Nektar's collaboration with Eli Lilly & Company for the
development and commercialization of NKTR-358.
"Nektar's immuno-oncology portfolio continues to expand as we
add novel drug candidates to our growing pipeline,"
said Howard W. Robin, President and CEO of Nektar. "NKTR-214
is the first I-O agent to both increase tumor-infiltrating
lymphocytes (TILs) and increase PD-1 expression on human immune
cells, which uniquely complements checkpoint inhibition and other
anti-cancer mechanisms. As the majority of cancer patients have
tumors that do not express PD-L1 and these patients receive limited
benefit from treatment with checkpoint inhibitors, the potential of
NKTR-214 to help patients is significant. Finally, based on
recent positive conversations with the agency regarding our
regulatory plans for NKTR-181, we are now planning to submit an NDA
for NKTR-181 by April 2018 with our
data package of over 2,100 patients and healthy volunteers."
Revenue in the third quarter of 2017 was $152.9
million as compared to $36.3 million in the third
quarter of 2016. Year-to-date revenue for 2017
was $212.2 million as compared to $128.0
million in the first nine months of 2016. Revenue in
2017 included recognition of $127.6 million of the $150.0
million upfront payment from Nektar's collaboration with Eli
Lilly & Company for the development and commercialization of
NKTR-358.
Total operating costs and expenses in the third quarter of 2017
were $83.4 million as compared to $69.2
million in the third quarter of 2016. Year-to-date total
operating costs and expenses in 2017 were $247.9
million as compared to $208.7 million for the same
period in 2016. Total operating costs and expenses increased
primarily as a result of increased research and development
(R&D) expense.
Research and development expense in the third quarter of 2017
was $65.7 million as compared to $52.0
million in the third quarter of 2016. Year-to-date
R&D expense for 2017 was $187.0 million as compared
to $153.6 million for the same period in 2016.
R&D expense was higher in the third quarter and first nine
months of 2017 as compared to the same periods in 2016 primarily
because of expenses for our pipeline programs, including Phase 3
clinical studies for NKTR-181, Phase 1/2 clinical studies of
NKTR-214 and NKTR-358 and IND-enabling activities for NKTR-262 and
NKTR-255.
General and administrative expense was $12.1
million in the third quarter of 2017 as compared to $10.3
million in the third quarter of 2016. G&A expense in
the first nine months of 2017 was $40.0 million as
compared to $31.5 million for the same period in 2016.
G&A expense in the first nine months of 2017 includes a
$3.3 million charge for a litigation
settlement related to a cross-license agreement.
Net income in the third quarter of 2017 was $60.9
million or $0.39 basic income per share as compared
to net loss of $43.2
million or $0.32 basic loss per share in the third
quarter of 2016. Net loss in the first nine months of 2017
was $62.9 million or $0.41 basic loss per share
as compared to $111.3 million or $0.82 basic loss
per share in the first nine months of 2016.
The company also announced upcoming presentations at the
following scientific congresses during the fourth quarter of
2017:
Society for Immunotherapy in Cancer (SITC)
32nd Annual Meeting, National Harbor, MD:
Oral
Presentation: "PIVOT-02: Preliminary safety, efficacy
and biomarker results from the Phase 1/2 study of CD-122-biased
agonist NKTR-214 plus nivolumab in patients with locally
advanced/metastatic solid tumors"
Presenter: Dr. Adi Diab, Assistant
Professor, Department of Melanoma Medical
Oncology, Division of Cancer Medicine, The University of Texas MD Anderson Cancer
Center, Houston, Texas
Session: Clinical Trials: Novel Combinations
Date: Saturday, November 11, 2017, 5:00 p.m. Eastern Time
Poster #P77: "The
Novel IL-2 Cytokine Immune Agonist NKTR-214 Harnesses the Adaptive
and Innate Immune System for the Treatment of Solid
Cancers"
Presenter: Salah Eddine Bentebibel, University of Texas MD Anderson Cancer Center
Session: Biomarkers and Immune Monitoring
Date: Friday, November 10, 2017, 12:30-2:00 p.m. Eastern Time
Poster
#P140: "NKTR-214 enhances anti-tumor T-cell immune
responses induced by checkpoint blockade or vaccination"
Presenter: Meenu Sharma,
University of Texas MD Anderson Cancer
Center
Session: Cancer Vaccines
Date: Saturday, November 11, 2017, 12:30-2:00 p.m. Eastern Time
Poster
#P274: "Combination of NKTR-214 and radiotherapy (RT)
to reverse anergy and expand tumor-specific CD8 T-Cells"
Presenter: Joshua
Walker, Oregon Health & Science University
Session: Combination Therapy
Date: Saturday, November 11,
2017, 12:30-2:00 p.m. Eastern
Time
Poster
#P275: "Harnessing the innate and adaptive immune
system to eradicate treated and distant untreated solid
tumors"
Presenter: Saul Kivimae, Nektar Therapeutics
Session: Combination Therapy
Date: Friday, November 10, 2017, 12:30-2:00 p.m. Eastern Time
Poster
#P332: "Pre-clinical efficacy and tolerability of
NKTR-255, a polymer-conjugated IL-15 for immuno-oncology"
Presenter: Peiwen Kuo, Nektar Therapeutics
Session: Combination Therapy
Date: Saturday, November 11, 2017, 12:30-2:00 p.m. Eastern Time
Poster #434: "Great
Apes Adenoviral vaccine encoding neoantigens synergizes with
immunomodulators to cure established tumors in mice"
Presenter: Anna Morena D'Alise, Nouscom srl
Session: Personalized Vaccines and
Technologies/Personalized Medicines
Date: Saturday, November 11,
2017, 12:30-2:00 p.m. Eastern
Time
American College of Neuropsychopharmacology 56th
Annual Meeting, Palm Springs,
CA:
Poster #T166: "Abuse
potential of NKTR-181 in recreational opioid users: results from a
randomized, double-blind crossover oral study"
Presenter: Snow Ge, Nektar Therapeutics
Session: Poster Session II
Date: Tuesday, December 5,
2017, 5:30-7:30 p.m. Pacific Time
Conference Call to Discuss Third Quarter 2017 Financial
Results
Nektar management will host a conference call to review the
results beginning at 5:00 p.m. Eastern Time/2:00 p.m. Pacific Time, Tuesday, November 7,
2017.
This press release and a live audio-only Webcast of the
conference call can be accessed through a link that is posted on
the home page and Investors section of the Nektar website:
http://ir.nektar.com/index.cfm. The web broadcast of the conference
call will be available for replay through Monday, December 11,
2017.
To access the conference call,
follow these instructions:
Dial: (877) 881.2183 (U.S.); (970) 315.0453
(international)
Passcode: 4677348 (Nektar Therapeutics is the
host)
In the event that any non-GAAP financial measure is discussed on
the conference call that is not described in the press release, or
explained on the conference call, related information will be made
available on the Investor Relations page at
the Nektar website as soon as practical after the
conclusion of the conference call.
About Nektar
Nektar Therapeutics is a research-based development stage
biopharmaceutical company whose mission is to discover and develop
innovative medicines to address the unmet medical needs of
patients. Our R&D pipeline of new investigational medicines
includes treatments for cancer, auto-immune disease and chronic
pain. We leverage Nektar's proprietary and proven chemistry
platform in the discovery and design of our new therapeutic
candidates. Nektar is headquartered in San
Francisco, California, with additional operations
in Huntsville, Alabama and Hyderabad, India.
Further information about the company and its drug development
programs and capabilities may be found online
at http://www.nektar.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains uncertain or forward-looking
statements which can be identified by words such as: "could,"
"plan," "expect," "should," "may," "will" and similar references to
future periods. Examples of forward-looking statements include,
among others, statements we make regarding the potential
therapeutic benefits of and future development plans for our
products (including NKTR-181, NKTR-358, NKTR-214, NKTR-262 and
NKTR-255), the potential impact of NKTR-181 with respect to
the opioid abuse epidemic, the timing and strategy for regulatory
filings (including the timing and strategy for filing a new drug
application, "NDA") and meetings with representatives of the Food
and Drug Administration (FDA) and other governmental
officials, and the results of clinical trials.
Forward-looking statements are neither historical facts nor
assurances of future performance. Instead, they are based only on
our current beliefs, expectations and assumptions and are subject
to inherent uncertainties, risks and changes in circumstances that
are difficult to predict and many of which are outside of our
control. Our actual results may differ materially from those
indicated in the forward-looking statements and you should not rely
on such statements. Important factors that could cause our actual
results to differ materially from those indicated in the
forward-looking statements include: (i) clinical study outcomes
remain very unpredictable and it is possible that a clinical study
could fail even after positive interim data is observed; (ii) the
regulatory pathway to review and approve pharmaceutical products is
subject to substantial uncertainty; (iii) the data package required
for filing and approval of an NDA to the FDA is very uncertain and
difficult to predict due to broad FDA regulatory discretion,
established guidance and precedent (e.g., the practice of
typically requiring two placebo-controlled pivotal studies to
support NDA approvals for drugs like NKTR-181), and changing FDA
regulatory guidelines; (iv) the final
outcomes and conclusions from sponsor meetings with FDA are subject
to substantial FDA discretion associated with issuing final meeting
minutes and outcomes; (v) regulations concerning
and controlling access to opioid-based pharmaceuticals are strict
and is difficult to predict which scheduling category will
apply to NKTR-181 if regulatory approval is achieved; (vi) patents
may not issue from our patent applications for our drug candidates,
patents that have issued may not be enforceable, or additional
intellectual property licenses from third parties may be required;
and (vii) certain other important risks and uncertainties set forth
in our Quarterly Report on Form 10-Q filed with the Securities
and Exchange Commission on August 9, 2017. Any
forward-looking statement made by us in this press release is based
only on information currently available to us and speaks only as of
the date on which it is made. We undertake no obligation to update
any forward-looking statement.
Contact:
For Investors:
Jennifer Ruddock of Nektar Therapeutics
415-482-5585
Jodi Sievers of Nektar Therapeutics
415-482-5593
NEKTAR
THERAPEUTICS
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
ASSETS
|
|
September 30,
2017
|
|
December 31,
2016
|
(1)
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
37,967
|
|
$
59,640
|
|
|
Short-term
investments
|
|
314,600
|
|
329,462
|
|
|
Accounts receivable,
net
|
|
3,314
|
|
15,678
|
|
|
Inventory
|
|
13,654
|
|
11,109
|
|
|
Other current
assets
|
|
13,260
|
|
10,063
|
|
|
|
Total current
assets
|
|
382,795
|
|
425,952
|
|
|
|
|
|
|
|
|
|
Long-term
investments
|
|
59,596
|
|
-
|
|
Property, plant and
equipment, net
|
|
62,396
|
|
65,601
|
|
Goodwill
|
|
76,501
|
|
76,501
|
|
Other
assets
|
|
767
|
|
817
|
|
|
|
Total
assets
|
|
$
582,055
|
|
$
568,871
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$
8,563
|
|
$
2,816
|
|
|
Accrued
compensation
|
|
19,088
|
|
18,280
|
|
|
Accrued clinical
trial expenses
|
|
7,000
|
|
7,958
|
|
|
Other accrued
expenses
|
|
9,302
|
|
4,711
|
|
|
Interest
payable
|
|
4,198
|
|
4,198
|
|
|
Capital lease
obligations, current portion
|
|
2,482
|
|
2,908
|
|
|
Liability related to
refundable upfront payment
|
|
12,500
|
|
12,500
|
|
|
Deferred revenue,
current portion
|
|
25,491
|
|
14,352
|
|
|
Other current
liabilities
|
|
3,920
|
|
4,499
|
|
|
|
Total current
liabilities
|
|
92,544
|
|
72,222
|
|
|
|
|
|
|
|
|
|
Senior secured notes,
net
|
|
244,771
|
|
243,464
|
|
Liability related to
the sale of future royalties, net
|
|
98,394
|
|
105,950
|
|
Deferred revenue,
less current portion
|
|
56,225
|
|
51,887
|
|
Other long-term
liabilities
|
|
5,959
|
|
7,223
|
|
|
|
Total
liabilities
|
|
497,893
|
|
480,746
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
Preferred
stock
|
|
-
|
|
-
|
|
|
Common
stock
|
|
15
|
|
15
|
|
|
Capital in excess of
par value
|
|
2,170,169
|
|
2,111,483
|
|
|
Accumulated other
comprehensive loss
|
|
(1,907)
|
|
(2,363)
|
|
|
Accumulated
deficit
|
|
(2,084,115)
|
|
(2,021,010)
|
|
|
|
Total stockholders'
equity
|
|
84,162
|
|
88,125
|
|
|
Total liabilities and
stockholders' equity
|
|
$
582,055
|
|
$
568,871
|
|
|
(1) The consolidated
balance sheet at December 31, 2016 has been derived from the
audited financial statements at that date but does not include
all of the information
and notes required by generally accepted accounting principles in
the United States for complete financial statements.
|
NEKTAR
THERAPEUTICS
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands, except
per share information)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
Product
sales
|
|
$
4,448
|
|
$
14,698
|
|
$
24,897
|
|
$
41,664
|
|
Royalty
revenue
|
|
9,302
|
|
5,573
|
|
23,953
|
|
13,150
|
|
Non-cash royalty
revenue related to sale of future royalties
|
|
8,066
|
|
7,692
|
|
21,367
|
|
22,341
|
|
License,
collaboration and other revenue
|
|
131,112
|
|
8,373
|
|
142,028
|
|
50,829
|
Total
revenue
|
|
152,928
|
|
36,336
|
|
212,245
|
|
127,984
|
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
5,674
|
|
7,033
|
|
20,794
|
|
23,611
|
|
Research and
development
|
|
65,714
|
|
51,951
|
|
187,032
|
|
153,569
|
|
General and
administrative
|
|
12,055
|
|
10,253
|
|
40,027
|
|
31,515
|
Total operating costs
and expenses
|
|
83,443
|
|
69,237
|
|
247,853
|
|
208,695
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
69,485
|
|
(32,901)
|
|
(35,608)
|
|
(80,711)
|
|
|
|
|
|
|
|
|
|
|
Non-operating income
(expense):
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(5,540)
|
|
(5,614)
|
|
(16,452)
|
|
(16,918)
|
|
Non-cash interest
expense on liability related to sale of future royalties
|
|
(4,471)
|
|
(4,902)
|
|
(13,535)
|
|
(14,929)
|
|
Interest income and
other income (expense), net
|
|
1,599
|
|
332
|
|
3,163
|
|
1,666
|
Total non-operating
expense, net
|
|
(8,412)
|
|
(10,184)
|
|
(26,824)
|
|
(30,181)
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
provision for income taxes
|
|
61,073
|
|
(43,085)
|
|
(62,432)
|
|
(110,892)
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
202
|
|
139
|
|
434
|
|
433
|
Net income
(loss)
|
|
$
60,871
|
|
$
(43,224)
|
|
$
(62,866)
|
|
$
(111,325)
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.39
|
|
$
(0.32)
|
|
$
(0.41)
|
|
$
(0.82)
|
|
Diluted
|
|
$
0.37
|
|
$
(0.32)
|
|
$
(0.41)
|
|
$
(0.82)
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding used in computing net income (loss) per
share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
156,411
|
|
137,094
|
|
155,153
|
|
136,415
|
|
Diluted
|
|
162,641
|
|
137,094
|
|
155,153
|
|
136,415
|
NEKTAR
THERAPEUTICS
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
|
2017
|
|
2016
|
Cash flows from
operating activities:
|
|
|
|
|
|
Net
loss
|
|
$
(62,866)
|
|
$
(111,325)
|
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
|
|
Non-cash royalty
revenue related to sale of future royalties
|
|
(21,367)
|
|
(22,341)
|
|
|
Non-cash interest
expense on liability related to sale of future
royalties
|
|
13,535
|
|
14,929
|
|
|
Stock-based
compensation
|
|
25,118
|
|
18,793
|
|
|
Depreciation and
amortization
|
|
12,081
|
|
11,502
|
|
|
Other non-cash
transactions
|
|
(1,370)
|
|
(2,190)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
Accounts receivable,
net
|
|
12,364
|
|
5,698
|
|
|
Inventory
|
|
(2,545)
|
|
592
|
|
|
Other
assets
|
|
(2,036)
|
|
6,041
|
|
|
Accounts
payable
|
|
5,729
|
|
4,799
|
|
|
Accrued
compensation
|
|
808
|
|
9,735
|
|
|
Accrued clinical
trial expenses
|
|
(958)
|
|
2,726
|
|
|
Other accrued
expenses
|
|
4,971
|
|
2,386
|
|
|
Liability related to
refundable upfront payment
|
|
-
|
|
12,500
|
|
|
Deferred
revenue
|
|
15,477
|
|
(12,665)
|
|
|
Other
liabilities
|
|
1,046
|
|
(5,793)
|
|
Net cash used in
operating activities
|
|
(13)
|
|
(64,613)
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
Purchases of
investments
|
|
(314,439)
|
|
(142,972)
|
|
|
Maturities of
investments
|
|
261,112
|
|
201,449
|
|
|
Sales of
investments
|
|
8,823
|
|
4,969
|
|
|
Purchases of
property, plant and equipment
|
|
(7,283)
|
|
(3,741)
|
|
Net cash (used in)
provided by investing activities
|
|
(51,787)
|
|
59,705
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
Payment of capital
lease obligations
|
|
(2,159)
|
|
(5,376)
|
|
|
Proceeds from shares
issued under equity compensation plans
|
|
32,275
|
|
18,041
|
|
Net cash provided by
financing activities
|
|
30,116
|
|
12,665
|
|
|
|
|
|
|
|
|
Effect of exchange
rates on cash and cash equivalents
|
|
11
|
|
(32)
|
|
Net (decrease)
increase in cash and cash equivalents
|
|
(21,673)
|
|
7,725
|
|
Cash and cash
equivalents at beginning of period
|
|
59,640
|
|
55,570
|
|
Cash and cash
equivalents at end of period
|
|
$
37,967
|
|
$
63,295
|
|
|
|
|
|
|
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
|
Cash paid for
interest
|
|
$
14,989
|
|
$
15,513
|
View original
content:http://www.prnewswire.com/news-releases/nektar-therapeutics-reports-financial-results-for-the-third-quarter-of-2017-300551330.html
SOURCE Nektar Therapeutics