Aclaris Therapeutics Reports Fourth Quarter and Full Year 2018 Financial Results and Provides Update on Clinical and Commerci...
March 18 2019 - 7:00AM
Aclaris Therapeutics, Inc. (NASDAQ: ACRS), a physician-led
biopharmaceutical company focused on dermatological and
immuno-inflammatory diseases, today announced financial results for
the fourth quarter and full year 2018, and provided an update on
its clinical development and commercial programs.
- In November 2018, Aclaris acquired the worldwide rights to
RHOFADE® (oxymetazoline hydrochloride) cream, 1% from Allergan
Sales, LLC.
- In December 2018, Aclaris began promoting RHOFADE, which is
approved in the United States for the topical treatment of
persistent facial erythema (redness) associated with rosacea in
adults.
- In February 2019, at the annual National Sales Meeting, Aclaris
appointed Jeff Wayne as interim Head of Commercial and officially
relaunched RHOFADE.
- Today Aclaris is providing an update, including new photos,
from AUATB-201 Topical, an open-label clinical trial in patients
with eyebrow loss due to alopecia areata (AA), including patients
with alopecia totalis or alopecia universalis.
“On the commercial side of the company, we made a change in
leadership as we focus on the relaunch of RHOFADE in 2019. Our
development stage pipeline continues to advance with multiple data
read outs expected during the course of the year across both our
JAK inhibitor and A-101 clinical programs. Finally, we look
to move our first Confluence originated asset into the clinic in
the second half of the year; a significant milestone given we
acquired and integrated the team just 18 months ago. Given the
anticipated data readouts, we expect 2019 to be a watershed year as
we become a fully integrated biopharmaceutical company,” said Dr.
Neal Walker, President and Chief Executive Officer of Aclaris.
Clinical Pipeline Update:
- A-101 45% Topical Solution:
- Two pivotal Phase 3 trials, named THWART-1 and THWART-2, for
the treatment of common warts are progressing as planned. THWART-2
has completed enrollment, and THWART-1 is expected to complete
enrollment by the end of this month. These two trials will enroll a
total of approximately 1,000 patients across both studies, and
topline data are expected in the second half of 2019.
- An open-label safety extension trial investigating A-101 45%
Topical Solution for the treatment of common warts is also ongoing;
if the results of these trials are positive, NDA submission is
expected in the first half of 2020.
- JAK Inhibitor Trials:
- We have completed enrollment in all of the following JAK
inhibitor trials:
- AA-201 Topical – This ongoing Phase 2
randomized, double-blinded, parallel-group, vehicle-controlled
trial is evaluating the safety, efficacy, and dose response of two
concentrations of ATI-502, a topical JAK1/3 inhibitor, on the
regrowth of hair in 129 patients with AA. Data are expected in the
second quarter of 2019.
- AGA-201 Topical – This ongoing Phase 2
open-label clinical trial is evaluating the safety and efficacy of
ATI-502, a topical JAK1/3 inhibitor, on the regrowth of hair in 31
patients with androgenetic alopecia (AGA), also known as
male/female pattern hair loss. 6-month data are expected in the
second quarter of 2019 and 12-month data are expected in the second
half of 2019.
- VITI-201 Topical – This ongoing Phase 2
open-label clinical trial is evaluating the safety and efficacy of
ATI-502, a topical JAK1/3 inhibitor, on the repigmentation of
facial skin in 34 patients with vitiligo. 6-month interim data are
expected in the second quarter of 2019 and 12-month data are
expected in the second half of 2019.
- AD-201 Topical – This ongoing Phase 2
open-label clinical trial is evaluating the safety and efficacy of
ATI-502, a topical JAK1/3 inhibitor, in 22 adult patients with
moderate-to-severe atopic dermatitis (AD). Data are expected in
mid-2019.
- AUAT-201 Oral – This ongoing randomized,
double-blinded, parallel-group, placebo-controlled trial is
evaluating the safety, efficacy, and dose response of three
concentrations of ATI-501, an oral JAK 1/3 inhibitor, on the
regrowth of hair in 87 patients with AA. Data are expected in the
second half of 2019.
- ATI-450 (MK-2 Inhibitor) – We expect to submit
an Investigational New Drug (IND) application for rheumatoid
arthritis to the FDA in mid-2019. If the IND is allowed by the FDA,
we expect to initiate a Phase 1 and Phase 2 trial in the second
half of 2019.
Recent Corporate Highlights:
- Significant presence at 2019 Annual Academy of Dermatology
(AAD) Annual Meeting to support the relaunch of RHOFADE. Aclaris
also presented 6 posters, including 2 oral presentations regarding
the clinical results of ESKATA® for the treatment of raised
seborrheic keratosis and A-101 45% topical solution for the
treatment of common warts.
- Aclaris received approval from the Swedish Medical Products
Agency to market ESKATA® (hydrogen peroxide) cutaneous solution,
685 mg, for the treatment in adults of seborrheic keratoses that
are not pedunculated and have up to a maximum diameter of 15 mm
each. Aclaris also has received approval to market the medicine in
the United Kingdom, Iceland, and Belgium. Aclaris is seeking a
commercial partner or partners to market the medicine as an
aesthetic skin treatment in various European countries with the
brand name ESKATA® in Finland, Iceland, Netherlands, Norway,
Portugal, Spain, Sweden, Czech Republic, and Belgium, and the brand
name ESKERIELE® in Austria, France, Germany, Ireland, Italy, and
the United Kingdom.
- Canadian partner Cipher Pharmaceuticals Inc. submitted a New
Drug Submission for A-101 40% Topical Solution for the treatment of
raised SKs, which was accepted for review by Health Canada in
December 2018.
Commercial Update:
- Jeff Wayne, Aclaris’ Vice President of Business Development,
was recently appointed as interim Head of Commercial. Mr. Wayne
brings over 30 years of pharmaceutical experience with the majority
spent in dermatology. During his career, he has held positions of
increasing responsibility in sales, marketing, and general
management with Galderma, Intendis, Promius Pharma (where he built,
launched, and led the commercial organization), Onset
Dermatologics, and LEO Pharma. He launched METROGEL® in both the
United States and Canada and was responsible for the marketing of
FINACEA® in the United States; two medications prescribed for the
treatment of rosacea. In his role as Vice President, Business
Development, he managed the RHOFADE transaction from the beginning,
providing a seamless transition of leadership.
- Following our National Sales Meeting held mid-February, RHOFADE
was officially relaunched, and featured prominently at the Aclaris
booth and throughout the convention venue at the 2019 AAD Annual
Meeting.
- The Aclaris field sales team was realigned to optimize reach
and call frequency on current and potential RHOFADE prescribers, as
well as the top 10 ESKATA accounts in each territory.
- Comparing the 4-week period ended March 8, 2019 to the
immediately prior 4-week period, the IQVIA data showed an 8.4%
increase in total prescriptions for RHOFADE.
- Based on these early prescription trends, we believe the
response to the RHOFADE message, which emphasizes the need to treat
all rosacea patients with persistent facial erythema, appears
positive.
Financial Highlights
Liquidity and Capital Resources
As of December 31, 2018, Aclaris had aggregate cash, cash
equivalents and marketable securities of $168.0 million compared to
$208.9 million as of December 31, 2017. The $30.9 million decrease
during the year ended December 31, 2018 included:
- Aggregate net proceeds of $100.2 million from the sale of
common stock in a follow-on public offering of common stock in
October 2018;
- $67.1 million of cash used to acquire the global rights to
RHOFADE;
- $29.9 million of cash, net of issuance costs, borrowed under
the loan agreement with Oxford Finance LLC;
- $1.4 million in property and equipment purchases; and
- Net loss of $132.7 million, offset by $9.4 million of net cash
provided by working capital and $21.9 million of non-cash
stock-based compensation expense, depreciation, and
amortization.
Aclaris anticipates that its cash, cash equivalents and
marketable securities as of December 31, 2018 will be sufficient to
fund its operations into the fourth quarter of 2020, without giving
effect to any potential new business development transactions or
financing activities.
Fourth Quarter 2018 Financial Results
- Net loss was $38.6 million for the fourth quarter of 2018,
compared to $22.9 million for the fourth quarter of 2017.
- Net revenues were $3.7 million for the quarter ended December
31, 2018, which consisted of $0.8 million of net ESKATA sales, $1.1
million of net RHOFADE sales (December only), $1.3 million of
contract research revenues, and $0.5 million of other revenue. This
compared to $1.0 million for the quarter ended December 31, 2017,
all of which was contract research revenues. Cost of revenues was
$3.5 million for the quarter ended December 31, 2018, compared to
$0.8 million for the quarter ended December 31, 2017.
- Total operating expenses for the fourth quarter of 2018 were
$39.2 million, compared to $25.7 million for the fourth quarter of
2017.
- Research and development expenses were $19.5 million for the
fourth quarter of 2018, compared to $13.2 million for the fourth
quarter of 2017. The increase of $6.3 million was mainly the result
of the continued growth of Aclaris’ JAK inhibitor and common wart
programs, as multiple Phase 2 trials of ATI-501 and ATI-502 and
Phase 3 trials of A-101 45% were ongoing in the fourth quarter of
2018, as well as the increased headcount to support these
programs.
- Sales and marketing expenses were $13.0 million for the fourth
quarter of 2018, compared to $6.6 million for the fourth quarter of
2017. The increase of $6.4 million was the result of increases in
direct marketing and professional fees, as well as other commercial
and personnel expenses incurred to support the continued
commercialization of ESKATA following its launch in May 2018.
- General and administrative expenses were $6.7 million for the
fourth quarter of 2018, compared to $5.9 million for the fourth
quarter of 2017. The increase was driven by headcount increases,
and legal and business development costs related to the RHOFADE
acquisition in the fourth quarter of 2018.
Full Year 2018 Financial Results
- Net loss was $132.7 million for the year ended December 31,
2018, compared to $68.5 million for the year ended December 31,
2017.
- Net revenues were $10.1 million for the year ended December 31,
2018, which consisted of $2.8 million of net ESKATA sales, $1.1
million of net RHOFADE sales (December only), $4.7 million of
contract research revenues, and $1.5 million of other revenue. This
compared to $1.7 million for the year ended December 31, 2017, all
of which was contract research revenues. Cost of revenues was $6.9
million for the year ended December 31, 2018, compared to $1.2
million for the year ended December 31, 2017.
- Total operating expenses were $138.7 million for the year ended
December 31, 2018, compared to $72.9 million for the year ended
December 31, 2017. Net cash used in operating activities was $100.8
million for the year ended December 31, 2018, compared to $54.7
million for the year ended December 31, 2017.
- Research and development expenses were $63.0 million for the
year ended December 31, 2018, compared to $39.8 million for the
year ended December 31, 2017. The increase of $23.2 million was
mainly the result of the continued growth of Aclaris’ JAK inhibitor
and common wart programs, as multiple Phase 2 trials of ATI-501 and
ATI-502 and Phase 3 trials of A-101 45% were conducted throughout
2018, as well as the increased headcount to support these programs.
These increases were offset by a decrease in costs related to the
development of ESKATA as Aclaris submitted the NDA for ESKATA in
February 2017 following the completion of the clinical trials.
- Sales and marketing expenses were $48.0 million for the year
ended December 31, 2018, compared to $13.8 million for the year
ended December 31, 2017. The increase of $34.2 million was the
result of increases in direct marketing and professional fees, as
well as other commercial expenses incurred to support the launch
and commercialization of ESKATA in May 2018. Personnel expenses
also increased as Aclaris completed the hiring of its field sales
force early in 2018.
- General and administrative expenses were $27.6 million for the
year ended December 31, 2018, compared to $19.3 million for the
year ended December 31, 2017. The increase of $8.3 million was the
result of higher personnel expenses, due to increased headcount to
support the commercial launch of ESKATA, as well as legal and
business development costs related to the RHOFADE acquisition
during 2018. General and administrative expenses for the year ended
December 31, 2018 also included a $1.5 million ESKATA-related
milestone payment, whereas the year ended December 31, 2017
included a $1.0 million ESKATA-related milestone payment.
- As of December 31, 2018, Aclaris had 41.2 million shares of
common stock outstanding.
2019 Financial Outlook
- Aclaris expects 2019 GAAP research and development (R&D)
expenses to be in the range of $61 to $64 million, including
estimated stock-based compensation of $7 million. This expense
guidance for R&D in 2019 contemplates the completion of
Aclaris’ Phase 2 clinical trials in AA, open label trials in AGA,
vitiligo and AD, and two pivotal Phase 3 trials in common warts, as
well as the further advancement of Aclaris’ preclinical pipeline
compounds, including ATI-450 and ATI-1777.
- Aclaris expects 2019 GAAP sales and marketing (S&M)
expenses to be in the range of $37 to $40 million, including
estimated stock-based compensation of $4 million. This expense
guidance for S&M in 2019 contemplates all salesforce costs and
the selling and marketing initiatives to support our commercial
brands.
- Aclaris expects 2019 GAAP general and administrative (G&A)
expenses to be in the range of $29 to $31 million, including
estimated stock-based compensation of $10 million. This expense
guidance for G&A in 2019 contemplates additional medical
affairs, legal, and compliance activities to support our commercial
brands.
Company to Host Conference Call
Management will conduct a conference call at 8:00 AM
ET today to discuss Aclaris’ financial results and provide
a general business update. The conference call will be
webcast live over the Internet and can be accessed by logging on to
the “Investors” page of the Aclaris Therapeutics website,
www.aclaristx.com, prior to the event. A replay of the webcast will
be archived on the Aclaris Therapeutics website for 30 days
following the call.
To participate on the live call, please dial (844)
776-7782 (domestic) or (661) 378-9535 (international), and
reference conference ID 9765869 prior to the start
of the call.
About Aclaris Therapeutics, Inc.
Aclaris Therapeutics, Inc. is a physician-led biopharmaceutical
company committed to addressing the needs of people with
dermatological and immuno-inflammatory diseases who lack
satisfactory treatment options. The company’s diverse and
multi-stage portfolio includes two FDA-approved medicines, one
late-stage investigational medicine, and a pipeline powered by a
robust R&D engine exploring protein kinase regulation. Aclaris
Therapeutics’ active development programs focus on areas where
significant treatment gaps exist, such as common warts, alopecia
areata, and vitiligo. For additional information, please visit
www.aclaristx.com and follow Aclaris on LinkedIn or Twitter
@aclaristx.
Cautionary Note Regarding Forward-Looking
Statements
Any statements contained in this press release that do not
describe historical facts may constitute forward-looking statements
as that term is defined in the Private Securities Litigation Reform
Act of 1995. These statements may be identified by words such as
"believe", "expect", "may", "plan," "potential," "will," and
similar expressions, and are based on Aclaris' current beliefs and
expectations. These forward-looking statements include expectations
regarding the commercialization of RHOFADE and ESKATA, the clinical
development of Aclaris’ drug candidates, including the availability
of data from its ongoing and planned clinical trials, timing for
initiation of planned clinical trials and timing for regulatory
submissions, estimated research and development, sales, marketing,
and general and administrative expenses for 2019 ,and its belief
that its existing cash, cash equivalents and marketable securities
will be sufficient to fund its operations into the fourth quarter
of 2020. These statements involve risks and uncertainties that
could cause actual results to differ materially from those
reflected in such statements. Risks and uncertainties that may
cause actual results to differ materially include uncertainties
inherent in the conduct of clinical trials, Aclaris' reliance on
third parties over which it may not always have full control, and
other risks and uncertainties that are described in the Risk
Factors section of Aclaris' Annual Report on Form 10-K for the year
ended December 31, 2018, and other filings Aclaris makes with the
U.S. Securities and Exchange Commission from time to time. These
documents are available under the "SEC filings” section of the
Investors page of Aclaris' website at http://www.aclaristx.com. Any
forward-looking statements speak only as of the date of this press
release and are based on information available to Aclaris as of the
date of this release, and Aclaris assumes no obligation to, and
does not intend to, update any forward-looking statements, whether
as a result of new information, future events or otherwise.
Aclaris Therapeutics,
Inc.Consolidated Statements of Operations(unaudited, in
thousands, except share and per share data)
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
December 31, |
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
Revenues: |
|
|
|
|
|
|
|
Product
sales, net |
$ |
1,897 |
|
|
$ |
- |
|
|
$ |
3,940 |
|
|
$ |
- |
|
Contract
research |
|
1,272 |
|
|
|
999 |
|
|
|
4,651 |
|
|
|
1,683 |
|
Other
revenue |
|
500 |
|
|
|
- |
|
|
|
1,500 |
|
|
|
- |
|
Total revenues,
net |
|
3,669 |
|
|
|
999 |
|
|
|
10,091 |
|
|
|
1,683 |
|
Cost of revenue
(1) |
|
3,509 |
|
|
|
754 |
|
|
|
6,850 |
|
|
|
1,207 |
|
Gross
profit |
|
160 |
|
|
|
245 |
|
|
|
3,241 |
|
|
|
476 |
|
Operating
expenses: |
|
|
|
|
|
|
|
Research
and development (1) |
|
19,537 |
|
|
|
13,189 |
|
|
|
63,009 |
|
|
|
39,790 |
|
Sales and
marketing (1) |
|
12,967 |
|
|
|
6,585 |
|
|
|
47,997 |
|
|
|
13,769 |
|
General
and administrative (1) |
|
6,694 |
|
|
|
5,913 |
|
|
|
27,649 |
|
|
|
19,340 |
|
Total operating
expenses |
|
39,198 |
|
|
|
25,687 |
|
|
|
138,655 |
|
|
|
72,899 |
|
Loss from
operations |
|
(39,038 |
) |
|
|
(25,442 |
) |
|
|
(135,414 |
) |
|
|
(72,423 |
) |
Other
income, net |
|
487 |
|
|
|
678 |
|
|
|
2,676 |
|
|
|
2,070 |
|
Loss before income
taxes |
|
(38,551 |
) |
|
|
(24,764 |
) |
|
|
(132,738 |
) |
|
|
(70,353 |
) |
Provision for income
taxes |
|
- |
|
|
|
(1,830 |
) |
|
|
- |
|
|
|
(1,830 |
) |
Net loss |
$ |
(38,551 |
) |
|
$ |
(22,934 |
) |
|
$ |
(132,738 |
) |
|
$ |
(68,523 |
) |
Net loss per share,
basic and diluted |
$ |
(0.99 |
) |
|
$ |
(0.74 |
) |
|
$ |
(4.03 |
) |
|
$ |
(2.44 |
) |
Weighted average common
shares outstanding, basic and diluted |
|
38,760,676 |
|
|
|
30,838,741 |
|
|
|
32,909,762 |
|
|
|
28,102,386 |
|
|
|
|
|
|
|
|
|
(1) Amounts include
stock-based compensation expense as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
$ |
206 |
|
|
$ |
81 |
|
|
$ |
766 |
|
|
$ |
211 |
|
Research and
development |
|
1,564 |
|
|
|
1,618 |
|
|
|
6,480 |
|
|
|
5,471 |
|
Sales and
marketing |
|
805 |
|
|
|
591 |
|
|
|
3,492 |
|
|
|
1,851 |
|
General and
administrative |
|
2,381 |
|
|
|
2,010 |
|
|
|
9,317 |
|
|
|
6,897 |
|
Total stock-based
compensation expense |
$ |
4,956 |
|
|
$ |
4,300 |
|
|
$ |
20,055 |
|
|
$ |
14,430 |
|
|
|
|
|
|
|
|
|
Aclaris Therapeutics,
Inc.Selected Consolidated Balance Sheet Data(unaudited, in
thousands)
|
|
December 31, 2018 |
|
December 31, 2017 |
|
|
|
|
|
|
|
|
|
Cash, cash equivalents
and marketable securities |
|
$ |
167,972 |
|
$ |
208,854 |
|
Total assets |
|
|
275,566 |
|
|
243,509 |
|
Total current
liabilities |
|
|
27,342 |
|
|
12,762 |
|
Total liabilities |
|
|
60,442 |
|
|
18,247 |
|
Total stockholders'
equity |
|
|
215,124 |
|
|
225,262 |
|
|
|
|
|
|
|
|
|
Aclaris ContactMichael Tung, M.D. Senior Vice President
Corporate Strategy/Investor Relations 484-329-2140
mtung@aclaristx.com
Media ContactSheila KennedyVice President, Corporate
Communications484-321-5559media@aclaristx.com
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