-- EYSUVIS™ NDA Accepted by FDA; Assigned PDUFA
Goal Date of October 30, 2020 -- -- 2Q 2020 INVELTYS® Revenue of
$0.8 Million -- -- Conference Call and Webcast at 8:00 a.m. ET
--
Kala Pharmaceuticals, Inc. (NASDAQ:KALA), a biopharmaceutical
company focused on the discovery, development and commercialization
of innovative therapies for diseases of the eye, today reported
financial results for the second quarter ended June 30, 2020.
“We are very pleased with our progress in the second quarter,”
said Mark Iwicki, Chairman, President and Chief Executive Officer
of Kala Pharmaceuticals. “In May, the FDA accepted our NDA
resubmission for EYSUVIS, bringing us closer to potentially
delivering the first prescription medicine for the short-term
treatment of dry eye disease, including dry eye flares, which
affects approximately 33 million people in the United States. We
have now turned our attention toward a potential U.S. launch before
year-end. Given our established relationships with eye care
professionals across the United States and our experience with
INVELTYS, we believe we are well-positioned for a successful launch
of EYSUVIS, if approved.”
Second Quarter and Recent Highlights:
EYSUVIS™ (loteprednol etabonate ophthalmic suspension) 0.25%
Dry Eye Program: In May 2020, Kala announced that the U.S. Food
and Drug Administration (FDA) accepted the Company’s New Drug
Application (NDA) resubmission for EYSUVIS. The FDA stated that the
NDA resubmission is a complete, Class 2 response to the Complete
Response Letter (CRL) issued in August 2019, and set a Prescription
Drug User Fee Act (PDUFA) goal date of October 30, 2020 for the
completion of its six-month review of the NDA.
If approved, Kala intends to commercialize EYSUVIS in the United
States with its specialty sales force, which it plans to increase,
pending the status of the COVID-19 pandemic, to a total of
approximately 100 to 125 sales representatives, who will promote
both EYSUVIS and INVELTYS.
INVELTYS® (loteprednol etabonate ophthalmic suspension)
1%: In the second quarter of 2020, cataract procedures were
down 50% compared to the second quarter of 2019, due to the
deferral of ocular surgeries as a result of the COVID-19
pandemic.
Similarly, approximately 21,000 INVELTYS prescriptions were
reported by Symphony Health in the second quarter of 2020, which
represented a decrease of approximately 51% compared to the first
quarter of 2020. Beginning in March 2020 and continuing through
most of the second quarter of 2020, INVELTYS prescriptions and
revenue were adversely affected by the ongoing COVID-19 pandemic as
federal, state and local governments implemented restrictions on
elective procedures, including most ocular surgeries. INVELTYS
prescriptions subsequently achieved strong growth as states started
relaxing restrictions on elective procedures late in the second
quarter, resulting in total INVELTYS prescriptions growing from 544
during the week ended April 17th to over 3,000 prescriptions during
the week ended July 24th. Based on the speed with which ocular
surgeries were rescheduled as restrictions on elective procedures
were initially lifted, Kala believes INVELTYS prescriptions and
revenue will return to growth over time. However, the Company is
unable to project the specific timing or potential impact on future
revenues given the continued uncertainty around the impact and
duration of the restrictions related to COVID-19.
While in-person interactions with customers, including visits to
physician offices, clinics and hospitals, were suspended for a
significant portion of the second quarter, Kala’s entire sales
force is now back in the field and calling on customers. In
addition, the sales force continues to provide support virtually
through telephone and web-based technologies to those eye care
professionals they are unable to meet with face-to-face.
Financial Results: The financial results below contain
both GAAP and non-GAAP financial measures. The non-GAAP financial
measures exclude stock compensation, depreciation and non-cash
interest expense. See “Non-GAAP Financial Measures” below; for a
full reconciliation of our GAAP to non-GAAP financial measures,
please refer to the tables at the end of this press release.
- Cash Position: As of June 30, 2020, Kala had cash, cash
equivalents and short-term investments of $184.6 million, compared
to $85.4 million as of December 31, 2019. This increase reflects
aggregate gross proceeds of approximately $146.9 million received
from its follow-on underwritten public offering of common stock in
March 2020 and sales of common stock under its at-the-market (ATM)
offering program in the first quarter of 2020, partially offset by
cash used in operating activities. Kala anticipates that its
existing cash, cash equivalents and short-term investments will
enable it to fund its operations into at least the second quarter
of 2022.
Second Quarter 2020 Financial Results
- Net Product Revenue: For the quarter ended June 30,
2020, Kala reported net product revenue of $0.8 million relating to
sales of INVELTYS, compared to $2.1 million in the second quarter
of 2019, a decrease of $1.3 million. Net revenues in the second
quarter of 2020 were impacted by a reduction in ocular surgeries
due to restrictions related to COVID-19 when compared to the same
period in 2019. Kala recognizes revenue when product is shipped to
distributors.
- Cost of Product Revenues: For the quarter ended June 30,
2020, cost of product revenues was $0.8 million, compared to $0.4
million for the same period in 2019. Included in cost of product
revenues for the second quarter of 2020, and due to COVID-19, was a
reserve of $0.5 million for excess inventory. Non-GAAP cost of
product revenues was $0.7 million for the quarter ended June 30,
2020, compared to $0.3 million for the same period in 2019.
- SG&A Expenses: For the quarter ended June 30, 2020,
selling, general and administrative (SG&A) expenses were $15.3
million, compared to $17.0 million for the same period in 2019. The
decrease was primarily due to lower travel and external spending
due to COVID-19 as well as INVELTYS launch-related spending
incurred during the second quarter of 2019 which was not incurred
during the same quarter in 2020. Non-GAAP SG&A expenses were
$13.2 million for the quarter ended June 30, 2020, compared to
$15.1 million for the same period in 2019.
- R&D Expenses: For the quarter ended June 30, 2020,
research and development (R&D) expenses were $6.1 million,
compared to $7.1 million for the same period in 2019. The decrease
was primarily due to lower spending on STRIDE 3, our recently
completed Phase 3 trial of EYSUVIS, partially offset by
manufacturing of EYSUVIS which has been expensed as R&D.
Non-GAAP R&D expenses were $5.4 million for the quarter ended
June 30, 2020, compared to $6.2 million for the same period in
2019.
- Operating Loss: For the quarter ended June 30, 2020,
loss from operations was $21.3 million, compared to $22.4 million
for the same period in 2019. Non-GAAP operating loss was $18.6
million for the quarter ended June 30, 2020, compared to $19.6
million for the same period in 2019.
- Net Loss: For the quarter ended June 30, 2020, net loss
was $23.3 million, or $0.42 per share, compared to a net loss of
$23.8 million, or $0.70 per share, for the same period in 2019.
Non-GAAP net loss was $20.1 million for the quarter ended June 30,
2020, compared to $20.7 million for the same period in 2019. The
weighted average number of shares used to calculate net loss per
share was 55,703,882 for the quarter ended June 30, 2020, and
33,882,939 for the quarter ended June 30, 2019.
Financial Results for the Six Months Ended June 30,
2020
- Net Product Revenue: For the six months ended June 30,
2020, Kala reported net product revenue of $1.9 million relating to
sales of INVELTYS, compared to $3.4 million for the same period in
2019, a decrease of $1.5 million. Net revenues in the first six
months of 2020 were impacted by a reduction in ocular surgeries due
to restrictions related to COVID-19 as compared to the same period
in 2019. Kala recognizes revenue when product is shipped to
distributors.
- Cost of Product Revenues: For the six months ended June
30, 2020, cost of product revenues was $1.1 million, compared to
$0.6 million for the same period in 2019. Included in cost of
product revenues for the second quarter of 2020, was a reserve of
$0.5 million for excess inventory. Non-GAAP cost of product
revenues was $1.1 million for the six months ended June 30, 2020,
compared to $0.6 million for the same period in 2019.
- SG&A Expenses: For the six months ended June 30,
2020, SG&A expenses were $30.7 million, compared to $35.2
million for the same period in 2019. The decrease was primarily due
to lower travel and external spending due to COVID-19 as well as
INVELTYS launch-related spending incurred during the first six
months of 2019 which was not incurred during the same six month
period in 2020. Non-GAAP SG&A expenses were $26.7 million for
the six months ended June 30, 2020, compared to $31.4 million for
the same period in 2019.
- R&D Expenses: For the six months ended June 30,
2020, R&D expenses were $11.5 million, compared to $14.1
million for the same period in 2019. The decrease was primarily due
to lower spending on STRIDE 3, partially offset by manufacturing of
EYSUVIS which had been expensed as R&D. Non-GAAP R&D
expenses were $10.1 million for the six months ended June 30, 2020,
compared to $12.5 million for the same period in 2019.
- Operating Loss: For the six months ended June 30, 2020,
loss from operations was $41.4 million, compared to $46.5 million
for the same period in 2019. Non-GAAP operating loss was $36.0
million for the six months ended June 30, 2020, compared to $41.0
million for the same period in 2019.
- Net Loss: For the six months ended June 30, 2020, net
loss was $45.3 million, or $0.94 per share, compared to a net loss
of $49.2 million, or $1.45 per share, for the same period in 2019.
Non-GAAP net loss was $39.3 million for the six months ended June
30, 2020, compared to $43.3 million for the same period in 2019.
The weighted average number of shares used to calculate net loss
per share was 48,232,933 for the six months ended June 30, 2020,
and 33,880,494 for the six months ended June 30, 2019.
Conference Call Information Kala will host a live
conference call and webcast today, August 6, 2020 at 8:00 a.m. ET
to review its second quarter 2020 financial results. To access the
conference call, please dial 866-300-4091 (domestic callers) or
703-736-7433 (international callers) five minutes prior to the
start of the call and provide the conference ID: 6999350.
To access a subsequent archived recording of the call, please
visit the “Investors & Media” section on the Kala website at
http://kalarx.com.
Non-GAAP Financial Measures: In this press release, the
financial results of Kala are provided in accordance with
accounting principles generally accepted in the United States
(GAAP) and using certain non-GAAP financial measures. The items
included in GAAP presentations but excluded for purposes of
determining non-GAAP financial measures for the periods presented
in the press release are stock-based compensation expense, non-cash
interest and depreciation. Management believes this non-GAAP
information is useful for investors, taken in conjunction with
Kala’s GAAP financial statements, because it provides greater
transparency and period-over-period comparability with respect to
Kala’s operating performance. These measures are also used by
management to assess the performance of the business. Investors
should consider these non-GAAP measures only as a supplement to,
not as a substitute for, or as superior to, measures of financial
performance prepared in accordance with GAAP. In addition, these
non-GAAP financial measures are unlikely to be comparable with
non-GAAP information provided by other companies. For a
reconciliation of these non-GAAP financial measures to the most
comparable GAAP measures, please refer to the table at the end of
this press release.
About Kala Pharmaceuticals: Kala is a biopharmaceutical
company focused on the discovery, development and commercialization
of innovative therapies for diseases of the eye. Kala has applied
its AMPPLIFY® mucus penetrating particle Drug Delivery Technology
to a corticosteroid, loteprednol etabonate (LE), designed for
ocular applications, resulting in the January 2019 launch of
INVELTYS® (loteprednol etabonate ophthalmic suspension) 1% and its
investigational product candidate, EYSUVIS™ (loteprednol etabonate
ophthalmic suspension) 0.25%, for which a New Drug Application
(NDA) is under review by the U.S. Food and Drug Administration
(FDA) with a Prescription Drug User Fee Act (PDUFA) goal date set
for October 30, 2020.
Forward Looking Statements: This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, that involve substantial
risks and uncertainties, including statements regarding the company
potentially delivering the first prescription medicine for the
short-term treatment of dry eye disease, including dry eye flares,
plans to increase the number of sales representatives to a total of
approximately 100 to 125, INVELTYS prescriptions and revenue
returning to growth over time, expectations regarding potential
EYSUVIS launch timing, and the company’s expectations regarding its
use of cash, cash runway and projected revenues. All statements,
other than statements of historical facts, contained in this press
release, including statements regarding the Company’s strategy,
future operations, future financial position, future revenue,
projected costs, prospects, plans and objectives of management, are
forward-looking statements. The words “anticipate,” “believe,”
“continue” “could,” “estimate,” “expect,” “intend,” “may,” “plan,”
“potential,” “predict,” “project,” “should,” “target,” “will,”
“would,” and similar expressions are intended to identify
forward-looking statements, although not all forward-looking
statements contain these identifying words. The Company may not
actually achieve the plans, intentions or expectations disclosed in
its forward-looking statements, and you should not place undue
reliance on such forward-looking statements. Actual results or
events could differ materially from the plans, intentions and
expectations disclosed in the forward-looking statements as a
result of various risks and uncertainties including, but not
limited to: the impact of extraordinary external events, such as
the current pandemic health event resulting from the novel
coronavirus (COVID-19), and their collateral consequences,
including disruption of the activities of our sales force and the
market for INVELTYS and any delay in timing of regulatory review of
the NDA for EYSUVIS; whether the Company will be able to
successfully implement its commercialization plans for INVELTYS and
EYSUVIS, if approved; whether the market opportunity for INVELTYS
and EYSUVIS is consistent with the Company’s expectations and
market research; whether any additional clinical trials will be
initiated or required for EYSUVIS prior to approval of the NDA, or
at all, and whether the NDA for EYSUVIS will be approved on the
timeline expected, or at all; the Company’s ability execute on the
commercial launch of EYSUVIS, if and when approved, on the timeline
expected, or at all; whether the Company will be able to generate
its projected net product revenue on the timeline expected, or at
all; whether the Company's cash resources will be sufficient to
fund the Company's foreseeable and unforeseeable operating expenses
and capital expenditure requirements for the Company's expected
timeline; other matters that could affect the availability or
commercial potential of INVELTYS and the Company's product
candidates, including EYSUVIS; and other important factors, any of
which could cause the Company's actual results to differ from those
contained in the forward-looking statements, discussed in the “Risk
Factors” section of the Company’s Annual Report on Form 10-K, most
recently filed Quarterly Report on Form 10-Q and other filings the
Company makes with the Securities and Exchange Commission. These
forward-looking statements represent the Company’s views as of the
date of this release and should not be relied upon as representing
the Company’s views as of any date subsequent to the date hereof.
The Company does not assume any obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law.
Kala Pharmaceuticals,
Inc.
Balance Sheet Data
(in thousands)
(unaudited)
June 30,
December 31,
2020
2019
Cash, cash equivalents and short-term
investments
$
184,559
$
85,449
Total assets
245,510
154,323
Working capital (1)
180,084
80,710
Long-term debt, net of discounts
71,697
71,184
Other long-term liabilities
27,930
28,673
Total Stockholders’ equity
128,943
29,692
(1) The Company defines working capital as
current assets less current liabilities. See the Company's
condensed consolidated financial statements for further information
regarding its current assets and current liabilities.
Kala Pharmaceuticals,
Inc.
Condensed Consolidated
Statement of Operations
(In thousands, except share
and per share data)
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2020
2019
2020
2019
Product revenues, net
$
833
$
2,057
$
1,904
$
3,443
Costs and expenses:
Cost of product revenues
759
352
1,113
593
Selling, general and administrative
15,301
17,007
30,709
35,243
Research and development
6,053
7,108
11,487
14,067
Total operating expenses
22,113
24,467
43,309
49,903
Loss from operations
(21,280)
(22,410)
(41,405)
(46,460)
Other income (expense):
Interest income
102
646
400
1,402
Interest expense
(2,134)
(2,061)
(4,262)
(4,155)
Net loss
(23,312)
(23,825)
(45,267)
(49,213)
Net loss per share attributable to common
stockholders—basic and diluted
$
(0.42)
$
(0.70)
$
(0.94)
$
(1.45)
Weighted average shares outstanding—basic
and diluted
55,703,882
33,882,939
48,232,933
33,880,494
Kala Pharmaceuticals,
Inc.
Reconciliation of GAAP to
Non-GAAP Financial Measures
(In thousands)
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2020
2019
2020
2019
Net loss (GAAP)
$
(23,312)
$
(23,825)
$
(45,267)
$
(49,213)
Add-back: stock-based compensation
expense
2,493
2,621
4,988
5,094
Add-back: Non-cash interest
513
240
513
472
Add-back: depreciation
224
218
454
388
Non-GAAP Net loss
$
(20,082)
$
(20,746)
$
(39,312)
$
(43,259)
Cost of product revenues (GAAP)
$
759
$
352
$
1,113
$
593
Less: stock-based compensation expense
9
39
28
41
Less: depreciation
13
-
26
-
Non-GAAP Cost of product revenues
$
737
$
313
$
1,059
$
552
Selling, general and administrative
expenses (GAAP)
$
15,301
$
17,007
$
30,709
$
35,243
Less: stock-based compensation expense
1,933
1,787
3,686
3,651
Less: depreciation
150
142
300
236
Non-GAAP Selling, general and
administrative expenses
$
13,218
$
15,078
$
26,723
$
31,356
Research and development expenses
(GAAP)
$
6,053
$
7,108
$
11,487
$
14,067
Less: stock-based compensation expense
551
795
1,274
1,402
Less: depreciation
61
76
128
152
Non-GAAP research and development
expenses
$
5,441
$
6,237
$
10,085
$
12,513
Total operating loss (GAAP)
$
(21,280)
$
(22,410)
$
(41,405)
$
(46,460)
Less: stock-based compensation expense
2,493
2,621
4,988
5,094
Less: depreciation
224
218
454
388
Non-GAAP total operating loss
$
(18,563)
$
(19,571)
$
(35,963)
$
(40,978)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200806005056/en/
Investors: Hannah Deresiewicz
hannah.deresiewicz@sternir.com 212-362-1200
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