Catalyst Pharmaceuticals Announces Second Quarter 2020 Financial Results and Provides Business Update
August 10 2020 - 4:15PM
Catalyst Pharmaceuticals, Inc. (Catalyst) (Nasdaq:CPRX), a
commercial-stage biopharmaceutical company focused on developing
and commercializing innovative therapies for people with rare
debilitating, chronic neuromuscular and neurological diseases,
today reported financial results for the second quarter ended June
30, 2020 and provided a business update.
“Despite operating under COVID-19 conditions, I
am quite pleased with the resiliency of our team and the operating
results that were achieved during the second quarter. Additionally,
as physicians’ practices begin to open again to in-person meetings
with patients and sales representatives, we are beginning to see an
improvement in new LEMS patient enrollments in Catalyst Pathways
and are hopeful that this is a start of a trend,” said Patrick J.
McEnany, Chairman and Chief Executive Officer of Catalyst
Pharmaceuticals. “On a separate note, we are disappointed that the
top-line results of our Phase 3 study for Firdapse® in anti-MuSK
antibody positive myasthenia gravis patients did not replicate the
robust positive results that were observed in the 2017
proof-of-concept study. We intend to continue to analyze the data
and meet with our neuromuscular key opinion leaders to decide on
our path forward for this program.”
Q2-20 Financial Results
- Product revenue, net in the second quarter 2020 was $29.6
million compared to $28.8 for the second quarter 2019.
- Reported net income of $9.8 million, or $0.09 per basic and
diluted share, in the second quarter of 2020, compared with net
income of $11.0 million, or $0.11 per basic and $0.10 per diluted
share, for the second quarter of 2019.
- Research and development expenses for the second quarter of
2020 were $4.3 million as compared to $4.6 million for the second
quarter of 2019.
- Selling, general and administrative expenses for the second
quarter of 2020 totaled $10.8 million as compared to $9.0 million
in the second quarter of 2019.
- The Company’s total operating expenses for the second quarter
2020 were $19.3 million.
- Ended June 30, 2020 with $115.1 million in cash and investments
and no funded debt.
Corporate Highlights and Milestones
- Announced receipt of marketing authorization from Health Canada
for Firdapse® for the treatment of patients in Canada with
LEMS.
- Announced Jeffrey Del Carmen promotion to Chief Commercial
Officer.
- Recently met with the Japanese PMDA and believe we have reached
a tentative agreement for an acceptable and efficient regulatory
plan.
- Continued on-going evaluation of potential acquisition of
products or companies.
MuSK-MG Phase 3 Study
Results
- Firdapse® was safe and well tolerated during the MSK-002 study
and demonstrated a safety profile similar to that seen for
Firdapse® in the treatment of LEMS.
- The primary endpoint, the Myasthenia Gravis Activities of Daily
Living (MG-ADL) assessment, did not achieve statistical
significance (p=0.2196).
- The secondary endpoint, the Quantitative Myasthenia Gravis
(QMG) assessment, did not achieve statistical significance
(p=0.3736).
- We plan to complete the full analysis of data and findings and
to meet with our neuromuscular advisors to decide our path forward
for the MuSK-MG indication.
- Detailed results of this study will be made available in a
future scientific forum.
Other Firdapse®
Development Programs
- Enrollment in proof-of-concept spinal muscular atrophy type-3
study has been completed and we expect to report top-line data
before year-end.
- Firdapse® long-acting formulation development program continues
on schedule.
- Investigator studies for two additional neuromuscular
indications are expected to commence later this year.
COVID-19 Impact
- Issued a no travel and remote work policy for all Catalyst
employees on March 16th.
- Diligently working to reduce COVID-19 impact on new enrollments
and revenues.
- We believe that our current base of LEMS patients on reimbursed
Firdapse® is fairly stable and very compliant to their medication
regimen.
- Have not experienced any disruptions in the supply chain or
production of Firdapse® and believe the safety stock of Firdapse®
is more than adequate for current anticipated needs.
- Proudly partnered with First Responder’s Children’s
Foundation/COVID-19 Emergency Response Fund, which provides
emergency grants to support frontline emergency and healthcare
workers and their families enduring financial hardship during this
COVID-19 pandemic.
Balance Sheet and Key Activities in 2020
At June 30, 2020, Catalyst had cash and cash
equivalents and investments of $115.1 million and no funded
debt.
The Company plans to continue investing in the
following key activities in 2020:
- Expansion of U.S. commercialization of Firdapse®.
- On-going development programs evaluating Firdapse® for the
treatment of MuSK-MG and SMA Type 3, and our Expanded Access
Program for Firdapse®.
- Continue support for our Firdapse® long acting formulation and
other development programs.
- Support Canada pre-commercialization activities for
Firdapse®.
- Continue Japan regulatory activities to seek marketing
authorization for Firdapse®.
More detailed financial information and analysis
may be found in the Company's Quarterly Report on Form 10-Q, which
was filed with the Securities and Exchange
Commission (SEC) on August 10, 2020.
Non-GAAP Financial Measures
Excluding expenses related to stock-based
compensation of $1.8 million, non-GAAP1 net income for the second
quarter of 2020 was $11.6 million, or $0.11 per basic and diluted
share. This compares to a non-GAAP1 net income of $11.9 million, or
$0.12 per basic share and $0.11 per diluted share, excluding
stock-based compensation expense of $925 thousand, for the second
quarter of 2019. Excluding expenses related to stock-based
compensation of $3.3 million, non-GAAP1 net income for the six
months ended June 30, 2020 was $23.5 million, or $0.23 per basic
share and $0.22 per diluted share. This compares to a non-GAAP1 net
income of $12.2 million, or $0.12 per basic and diluted share,
excluding stock-based compensation expense of $1.9 million, for the
six months ended June 30, 2019.
Conference Call
Catalyst management will host an
investment-community conference call and webcast at 8:30 a.m. ET,
tomorrow, Tuesday, August 11, 2020 to discuss the financial results
and provide a corporate update. Investors who wish to participate
in the conference call may do so by dialing (877) 407-8912 for
domestic and Canadian callers or (201) 689-8059 for international
callers. Those interested in listening to the conference call live
via the internet may do so by visiting the Investors page of the
company's website at www.catalystpharma.com and clicking on the
webcast link on the Investors home page. A webcast replay will be
available on the Catalyst website for 30 days following the call by
visiting the Investor page of the company's website at
www.catalystpharma.com.
About Catalyst
Pharmaceuticals
Catalyst Pharmaceuticals is a commercial-stage
biopharmaceutical company focused on developing and
commercializing innovative therapies for people
with rare debilitating, chronic neuromuscular and
neurological diseases, including Lambert-Eaton myasthenic syndrome
(LEMS), anti-MuSK antibody positive myasthenia gravis (MuSK-MG) and
spinal muscular atrophy (SMA) Type 3. Catalyst's new drug
application for Firdapse® (amifampridine) 10 mg tablets for the
treatment of adults with LEMS was approved in November 2018 by
the U.S. Food & Drug Administration ("FDA"), and
Firdapse® is now commercially available in the United States.
Prior to its approval, Firdapse® for LEMS had received breakthrough
therapy designation and orphan drug designation from
the FDA.
Firdapse® is being evaluated in clinical trials
for the treatment of MuSK-MG and SMA Type 3 and has received Orphan
Drug Designation from the FDA for myasthenia gravis and
CMS. Firdapse® (amifampridine) 10 mg tablets is the first and only
approved drug in Europe for the symptomatic treatment in
adults with LEMS.
Forward-Looking Statements
This press release contains forward-looking
statements. Forward-looking statements involve known and unknown
risks and uncertainties, which may cause Catalyst's actual results
in future periods to differ materially from forecasted results. A
number of factors, including (i) the impact of the effects of the
COVID-19 pandemic on Catalyst’s 2020 net product revenues and on
the timeline for reporting the top-line results from Catalyst’s SMA
Type 3 proof-of-concept study; (ii) whether, even if Catalyst is
successful in commercializing Firdapse®, Catalyst will achieve
sustained profitability; (iii) the effect on Catalyst’s business
and future results of operations of the approval by the FDA of
Ruzurgi® for the treatment of pediatric LEMS patients (ages 6 to
under 17); (iv) whether Catalyst's suit against the FDA seeking to
vacate the FDA's approval of Ruzurgi® will be successful; (v)
whether Firdapse® will ever be approved for commercialization for
the treatment of MuSK-MG, SMA Type 3, or any other disease; (vi)
whether Catalyst can successfully commercialize Firdapse® in
Canada; (vii) whether Catalyst is able to successfully complete the
clinical trial required for Catalyst to seek approval to
commercialize Firdapse® for sale in Japan; (viii) whether Catalyst
will ever be approved for commercialization in Japan; and (ix)
those other factors described in Catalyst's Annual Report on Form
10-K for the fiscal year 2019 and its other filings with the U.S.
Securities and Exchange Commission (SEC), could adversely affect
Catalyst. Copies of Catalyst's filings with the SEC are available
from the SEC, may be found on Catalyst's website, or may be
obtained upon request from Catalyst. Catalyst does not undertake
any obligation to update the information contained herein, which
speaks only as of this date.
1 Statements made in this press release
include a non-GAAP financial measure. Such information is provided
as additional information and not as an alternative to Catalyst's
financial statements presented in accordance with U.S. generally
accepted accounting principles (GAAP). This non-GAAP financial
measure is intended to enhance an overall understanding of
Catalyst's current financial performance. Catalyst believes that
the non-GAAP financial measure presented in this press release
provides investors and prospective investors with an alternative
method for assessing Catalyst's operating results in a manner that
Catalyst believes is focused on the performance of ongoing
operations and provides a more consistent basis for comparison
between periods. The non-GAAP financial measure in this press
release excludes from the calculation of net income (loss) the
expense associated with non-cash stock-based compensation.
Non-GAAP income (loss) per share is calculated by dividing non-GAAP
income (loss) by the weighted average common shares
outstanding.
CATALYST PHARMACEUTICALS,
INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
|
For the Three Months Ended June
30, |
|
For the Six Months Ended June
30, |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Product revenue, net |
$ |
29,604,764 |
|
$ |
28,837,900 |
|
$ |
58,741,236 |
|
$ |
41,286,338 |
|
|
|
|
|
|
|
|
Operating costs and expenses: |
|
|
|
|
|
|
|
Cost of sales |
|
4,139,873 |
|
|
4,261,625 |
|
|
8,290,739 |
|
|
5,973,413 |
Research and development |
|
4,349,643 |
|
|
4,629,364 |
|
|
8,572,454 |
|
|
7,937,323 |
Selling, general and administrative |
|
10,833,358 |
|
|
8,987,722 |
|
|
20,896,406 |
|
|
17,404,182 |
Total operating costs and expenses |
|
19,322,874 |
|
|
17,878,711 |
|
|
37,759,599 |
|
|
31,314,918 |
Operating income (loss) |
|
10,281,890 |
|
|
10,959,189 |
|
|
20,981,637 |
|
|
9,971,420 |
Other income, net |
|
111,269 |
|
|
450,410 |
|
|
447,502 |
|
|
793,676 |
Net income (loss) before income taxes |
|
10,393,159 |
|
|
11,409,599 |
|
|
21,429,139 |
|
|
10,765,096 |
Provision for income taxes |
|
613,172 |
|
|
449,651 |
|
|
1,223,137 |
|
|
449,651 |
Net income (loss) |
$ |
9,779,987 |
|
$ |
10,959,948 |
|
$ |
20,206,002 |
|
$ |
10,315,445 |
|
|
|
|
|
|
|
|
Net income (loss) per share: |
|
|
|
|
|
|
|
Basic |
$ |
0.09 |
|
$ |
0.11 |
|
$ |
0.20 |
|
$ |
0.10 |
Diluted |
$ |
0.09 |
|
$ |
0.10 |
|
$ |
0.19 |
|
$ |
0.10 |
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
103,414,523 |
|
|
102,869,202 |
|
|
103,410,881 |
|
|
102,808,897 |
Diluted |
|
106,730,423 |
|
|
105,928,970 |
|
|
106,433,862 |
|
|
105,098,930 |
|
CATALYST PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
June 30,2020 |
|
December 31,2019 |
|
(unaudited) |
|
|
ASSETS |
|
|
|
Current Assets: |
|
|
|
Cash and cash equivalents |
$ |
115,052,248 |
|
$ |
89,511,710 |
Short-term investments |
|
-- |
|
|
5,007,050 |
Accounts receivable, net |
|
6,762,262 |
|
|
10,536,997 |
Inventory |
|
1,827,924 |
|
|
1,956,792 |
Prepaid expenses and other current assets |
|
7,521,253 |
|
|
4,351,074 |
Total current assets |
|
131,163,687 |
|
|
111,363,623 |
Operating lease right-of-use asset |
|
71,711 |
|
|
793,252 |
Property and equipment, net |
|
167,514 |
|
|
210,467 |
Deposits |
|
8,888 |
|
|
8,888 |
Total assets |
$ |
131,411,800 |
|
$ |
112,376,230 |
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
Current Liabilities: |
|
|
|
Accounts payable |
$ |
5,804,778 |
|
$ |
4,117,447 |
Accrued expenses and other liabilities |
|
14,405,597 |
|
|
19,981,295 |
Total current liabilities |
|
20,210,375 |
|
|
24,098,742 |
Operating lease liability, net of current portion |
|
-- |
|
|
647,532 |
Total liabilities |
|
20,210,375 |
|
|
24,746,274 |
|
|
|
|
Total stockholders’ equity |
|
111,201,425 |
|
|
87,629,956 |
Total liabilities and stockholders’ equity |
$ |
131,411,800 |
|
$ |
112,376,230 |
Investor Contact
Brian Korb
Solebury Trout
(646) 378-2923
bkorb@troutgroup.com
Company Contact
Patrick J. McEnany
Catalyst Pharmaceuticals
Chief Executive Officer
(305) 420-3200
pmcenany@catalystpharma.com
Media Contact
David Schull
Russo Partners
(212) 845-4271
david.schull@russopartnersllc.com
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