Akari Therapeutics Reports First Quarter 2019 Financial Results And Highlights Recent Clinical Progress
May 29 2019 - 7:45AM
Akari Therapeutics, Plc (Nasdaq: AKTX), a biopharmaceutical company
focused on innovative therapeutics to treat orphan autoimmune and
inflammatory diseases where complement and/or leukotriene systems
are implicated, today announced its financial results for the first
quarter ended March 31, 2019 and recent clinical progress.
“We have seen positive clinical signals in all three of our new
programs in BP, HSCT-TMA and AKC, with rapid improvement in the
relevant clinical measures and with no drug-related serious adverse
events,” said Clive Richardson, Interim Chief Executive Officer of
Akari Therapeutics. “Both AKC and BP have further planned clinical
readouts this year, providing a potential opportunity to consider
advancing both into pivotal trials in 2020 and further supporting
the therapeutic role of combined C5 and LTB4 treatment.”
First Quarter 2019 and Recent Business
Highlights
- Pediatric hematopoietic stem cell transplant-related
thrombotic microangiopathy (HSCT-TMA).
- In March 2019, the Company announced it had a successful Type
B, pre-IND meeting with the U.S. Food and Drug Administration (FDA)
regarding its proposed pivotal clinical trial program for HSCT-TMA.
A pivotal trial for HSCT-TMA with nomacopan is expected to start in
the fourth quarter of 2019. This condition has an estimated 80%
mortality rate in children with this severe disease, with currently
no approved treatments.
- Phase II clinical trial in patients with bullous
pemphigoid (BP).
- During the first quarter, the Company announced initial results
from the first three patients with mild-to-moderate BP in the
ongoing Phase II trial with nomacopan, dosed daily subcutaneously.
The data showed no drug-related adverse events and a rapid
improvement in disease such that by day 42 of treatment with
nomacopan, the BPDAI global score fell by a mean of 52% and
blisters/erosions dropped by a mean of 87%. BP is a severe orphan
inflammatory skin disease currently treated primarily with steroids
and immunosuppressants which bring with them well-known side
effects. The Company anticipates data in mild-to-moderate patients
from this study by the fourth quarter of 2019, and extension within
the current study to include more severe patients in the second
half of 2019.
- Phase I/II clinical trial in patients with atopic
keratoconjunctivitis (AKC).
- In a “first in eye” Phase I/II study in AKC, initial surface of
the eye data from the first two patients in the study, treated
topically with nomacopan demonstrated no drug-related adverse
events. In addition, there was a >35% improvement in composite
efficacy score at day 14 of treatment compared to baseline
treatment on maximal cyclosporin, the standard of care. The Company
is currently in Part A of the study and anticipates progressing
into the Part B placebo-controlled efficacy arm by mid-year 2019,
with completion of the study by the fourth quarter of 2019.
- Expanding pipeline opportunities
- The Company is identifying an expanding pipeline of
opportunities in diseases where complement and leukotriene pathways
are both potentially implicated. For example, at the 2019
Association for Research in Vision and Ophthalmology (ARVO) annual
meeting Akari described the role of C5 and LTB4 in an experimental
autoimmune uveitis model, underpinning the Company’s plans to
develop a clinical back of the eye program.
Upcoming Events and Milestones
- HSCT-TMA pivotal clinical trial expected to start in the fourth
quarter of 2019.
- Mild-to-moderate BP trial results expected in the fourth
quarter of 2019.
- Expansion of existing BP Phase II clinical trial into the
severe patient population expected in the second half of 2019.
- Expansion of the AKC Phase I/II trial into Part B
placebo-controlled efficacy arm after an independent data review of
Part A safety expected mid-year 2019.
- Completion of Part B of AKC Phase I/II trial by the fourth
quarter of 2019.
- Initiate a Phase I clinical trial with new auto-injector pen
formulation in the second half of 2019.
First Quarter 2019 Financial Results
- Research and development (R&D) income in the first quarter
of 2019 was $2.3 million, as compared to R&D expenses of $1.0
million in the same quarter the prior year. This difference is
primarily due to the receipt of an R&D tax credit of $4.9
million in the first quarter of 2019, as compared to the receipt of
an R&D tax credit of $3.8 million in the first quarter of 2018.
Excluding the R&D tax credits in both periods, R&D expenses
decreased $2.2 million, or 47%, in the first quarter of 2019
compared to the same period the prior year due primarily to lower
expenses for manufacturing as the Company had previously
manufactured clinical trial material for supply through
2019.
- General and administrative (G&A) expenses in the first
quarter of 2019 were $2.3 million, as compared to $3.3 million in
the same quarter last year. This decrease was primarily due to
lower expenses associated with professional services, personnel and
rent, as well as lower stock-based non-cash compensation
expense.
- Total other expenses for the first quarter of 2019 was $2.6
million, as compared to total other income of $3.0 million in the
same period the prior year. This change was primarily due to $5.3
million of higher expense related to the change in the fair value
of the stock option liabilities in 2019 compared to 2018, and to
higher foreign exchange gains in 2019 as compared to
2018.
- Net loss for the first quarter of 2019 was $2.5 million,
compared to a net loss of $1.3 million for the same period in 2018.
The increase in net loss in the first quarter of 2019 was due
primarily to the change in the fair value of the stock option
liabilities and foreign exchange gains previously cited, offset by
the receipt of a higher R&D tax credit in the first quarter of
2019.
- As of March 30, 2019, the Company had cash of $6.1 million, as
compared to cash of $5.4 million as of December 31, 2018. During
the first quarter of 2019, the Company received an R&D tax
credit of $4.9 million.
- On September 26, 2018, the Company entered into a securities
purchase agreement (the “Purchase Agreement”) with Aspire Capital
Fund, LLC (“Aspire Capital”), which provides that, upon the terms,
Aspire Capital is committed to purchase up to an aggregate of $20.0
million of the Company’s ADSs over the 30-month term of the
Purchase Agreement. In consideration for entering into the Purchase
Agreement, concurrently with the execution of the Purchase
Agreement, the Company issued 30,000,000 ordinary shares to Aspire
Capital and sold to Aspire Capital 25,000,000 ordinary shares for
$0.02 per share (equivalent to $2.00 per ADS and $500,000).
Currently, approximately $1.2 million of the $20.0 million facility
has been drawn.
About Akari Therapeutics
Akari is a biopharmaceutical company focused on developing
inhibitors of acute and chronic inflammation, specifically for the
treatment of rare and orphan diseases, in particular those where
the complement (C5) or leukotriene (LTB4) systems, or both
complement and leukotrienes together, play a primary role in
disease progression. Akari's lead drug candidate, nomacopan
(Coversin), is a C5 complement inhibitor that also independently
and specifically inhibits leukotriene B4 (LTB4) activity. Nomacopan
(Coversin) is currently being clinically evaluated in four
indications: bullous pemphigoid (BP), atopic keratoconjunctivitis
(AKC), thrombotic microangiopathy, or TMA, and paroxysmal nocturnal
hemoglobinuria (PNH). Akari believes that the dual action of
nomacopan (Coversin) on both C5 and LTB4 may be beneficial in AKC
and BP. Akari is also developing other tick derived proteins,
including longer acting versions.
Cautionary Note Regarding Forward-Looking
Statements
Certain statements in this press release constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements reflect our current views about our plans, intentions,
expectations, strategies and prospects, which are based on the
information currently available to us and on assumptions we have
made. Although we believe that our plans, intentions, expectations,
strategies and prospects as reflected in or suggested by those
forward-looking statements are reasonable, we can give no assurance
that the plans, intentions, expectations or strategies will be
attained or achieved. Furthermore, actual results may differ
materially from those described in the forward-looking statements
and will be affected by a variety of risks and factors that are
beyond our control. Such risks and uncertainties for our company
include, but are not limited to: needs for additional capital to
fund our operations, our ability to continue as a going concern;
uncertainties of cash flows and inability to meet working capital
needs; an inability or delay in obtaining required regulatory
approvals for nomacopan and any other product candidates,
which may result in unexpected cost expenditures; our ability to
obtain orphan drug designation in additional indications; risks
inherent in drug development in general; uncertainties in obtaining
successful clinical results for nomacopan (Coversin) and any other
product candidates and unexpected costs that may result therefrom;
difficulties enrolling patients in our clinical trials; failure to
realize any value of nomacopan (Coversin) and any other product
candidates developed and being developed in light of inherent risks
and difficulties involved in successfully bringing product
candidates to market; inability to develop new product candidates
and support existing product candidates; the approval by the FDA
and EMA and any other similar foreign regulatory authorities of
other competing or superior products brought to market; risks
resulting from unforeseen side effects; risk that the market for
nomacopan (Coversin) may not be as large as expected; risks
associated with the departure of our former Chief Executive
Officers and other executive officers; risks related to material
weaknesses in our internal controls over financial reporting and
risks relating to the ineffectiveness of our disclosure controls
and procedures; risks associated with the SEC investigation;
inability to obtain, maintain and enforce patents and other
intellectual property rights or the unexpected costs associated
with such enforcement or litigation; inability to obtain and
maintain commercial manufacturing arrangements with third party
manufacturers or establish commercial scale manufacturing
capabilities; the inability to timely source adequate supply of our
active pharmaceutical ingredients from third party manufacturers on
whom the company depends; unexpected cost increases and
pricing pressures and risks and other risk factors detailed in our
public filings with the U.S. Securities and Exchange Commission,
including our most recently filed Annual Report on Form 20-F filed
with the SEC. Except as otherwise noted, these forward-looking
statements speak only as of the date of this press release and we
undertake no obligation to update or revise any of these statements
to reflect events or circumstances occurring after this press
release. We caution investors not to place considerable reliance on
the forward-looking statements contained in this press release.
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AKARI THERAPEUTICS, Plc |
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CONDENSED CONSOLIDATED BALANCE SHEETS |
As of March 31, 2019 and December 31, 2018 |
(in U.S. Dollars, except share data) |
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March 31, 2019 |
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December 31, 2018 |
Assets |
(Unaudited) |
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Current Assets: |
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Cash |
$ |
6,145,555 |
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$ |
5,446,138 |
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Prepaid expenses and other current assets |
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1,887,780 |
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1,423,184 |
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Deferred financing costs |
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579,810 |
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585,000 |
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Total Current Assets |
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8,613,145 |
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7,454,322 |
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Restricted cash |
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147,924 |
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521,829 |
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Property and equipment,
net |
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15,834 |
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20,425 |
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Patent acquisition costs,
net |
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32,867 |
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32,978 |
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Total Assets |
$ |
8,809,770 |
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$ |
8,029,554 |
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Liabilities and Shareholders' Equity |
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Current Liabilities: |
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Accounts payable |
$ |
1,763,182 |
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$ |
1,586,285 |
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Accrued expenses |
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1,625,228 |
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1,489,558 |
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Liabilities related to options |
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4,201,196 |
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1,842,424 |
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Total Liabilities |
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7,589,606 |
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4,918,267 |
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Commitments and Contingencies |
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Shareholders' Equity: |
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Share capital of £0.01 par value |
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Authorized: 10,000,000,000 ordinary shares; issued and outstanding:
1,585,693,413 |
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and 1,580,693,413 at March 31, 2019 and December 31, 2018,
respectively |
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23,716,875 |
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23,651,277 |
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Additional paid-in capital |
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107,097,477 |
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106,616,083 |
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Accumulated other comprehensive loss |
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(245,258 |
) |
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(352,426 |
) |
Accumulated deficit |
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(129,348,930 |
) |
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(126,803,647 |
) |
Total Shareholders'
Equity |
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1,220,164 |
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3,111,287 |
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Total Liabilities and
Shareholders' Equity |
$ |
8,809,770 |
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$ |
8,029,554 |
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AKARI THERAPEUTICS, Plc |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS -
UNAUDITED |
For the Three Months Ended March 31, 2019 and 2018 |
(in U.S. Dollars) |
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Three Months Ended |
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Mar 31, 2019 |
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Mar 31, 2018 |
Operating Expenses: |
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Research and development (income) expenses |
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(2,318,360 |
) |
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$ |
1,008,388 |
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General and administrative expenses |
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2,306,398 |
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3,296,973 |
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Total Operating Expenses |
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(11,962 |
) |
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4,305,361 |
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Income (Loss) from
Operations |
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11,962 |
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(4,305,361 |
) |
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Other Income (Expenses): |
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Interest income |
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1,286 |
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64,638 |
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Changes in fair value of
option liabilities - (loss)/gains |
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(2,358,772 |
) |
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2,945,531 |
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Foreign currency exchange
losses |
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(195,635 |
) |
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(40,975 |
) |
Other expenses |
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(4,124 |
) |
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(2,408 |
) |
Total Other Income
(Expenses) |
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(2,557,245 |
) |
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2,966,786 |
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- |
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Net Loss |
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(2,545,283 |
) |
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(1,338,575 |
) |
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Other Comprehensive Income: |
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Foreign Currency Translation Adjustment |
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107,168 |
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32,799 |
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Comprehensive Loss |
$ |
(2,438,115 |
) |
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$ |
(1,305,776 |
) |
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Loss per ordinary share (basic and diluted) |
$ |
(0.00 |
) |
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$ |
(0.00 |
) |
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Weighted average ordinary shares (basic and diluted) |
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1,580,860,080 |
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1,525,693,393 |
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For more informationInvestor Contact:
Peter VozzoWestwicke Partners(443)
213-0505peter.vozzo@westwicke.com
Media Contact:
Sukaina Virji / Nicholas Brown / Lizzie SeeleyConsilium
Strategic Communications+44 (0)20 3709
5700Akari@consilium-comms.com
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