-- Launched EYSUVIS™, First and Only
Prescription Therapy Approved Specifically for Short-Term Treatment
of the Signs and Symptoms of Dry Eye Disease --
-- Progressing Pipeline Programs to Address
Front and Back of Eye Diseases --
-- Cash Position and INVELTYS Revenue Expected
to Provide Runway Into at Least 4Q 2022; EYSUVIS Revenue Expected
to Provide Additional Runway --
-- 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 fourth quarter and full year ended
December 31, 2020 and provided a corporate update.
“2020 was a pivotal year for Kala, highlighted by U.S. Food and
Drug Administration (FDA) approval of EYSUVIS, the first and only
prescription therapy specifically for the short-term treatment of
dry eye disease and our second product approval in as many years.
Now, with launch activities underway, we are seeing prescription
growth and pleased to have secured formulary access with Express
Scripts as we continue to broaden our managed care coverage,” said
Mark Iwicki, Chairman, President and Chief Executive Officer of
Kala Pharmaceuticals. “As we begin the new year, we are operating
from a position of strength. We believe we are well-funded, with
sufficient resources to support our commercial efforts and
investments in our pipeline, which includes several preclinical
programs with the potential to address multiple front and back of
the eye diseases.”
Fourth Quarter and Recent Highlights:
EYSUVIS™ (loteprednol etabonate ophthalmic suspension)
0.25%: EYSUVIS became commercially available in January 2021 as
the first and only FDA-approved medicine for the short-term (up to
two weeks) treatment of the signs and symptoms of dry eye disease.
EYSUVIS is now available through national and regional U.S.
pharmaceutical distribution centers, as well as local pharmacies
and for home delivery. Kala’s ophthalmic sales force, which was
expanded during the fourth quarter of 2020 and now consists of 91
sales professionals, is actively calling on eye care professionals,
including both ophthalmologists and optometrists.
As of February 12, which marked six weeks of full promotional
launch, an aggregate of more than 2,200 EYSUVIS prescriptions were
filled by over 550 unique prescribers. These figures reflect data
from both Symphony Health and the EYSUVIS I-Save program, Kala’s
patient hub. Additionally, in February 2021, EYSUVIS was added to
Express Scripts’ National Preferred, Basic and High Performance
Formularies. Kala continues to engage in contract discussions with
other commercial and Medicare Part D health plans and expects to
further expand formulary coverage in the coming weeks and
months.
INVELTYS® (loteprednol etabonate ophthalmic suspension)
1%: Approximately 41,000 INVELTYS prescriptions were reported
by Symphony Health in the fourth quarter of 2020, which represents
an increase of approximately eight percent compared to the third
quarter of 2020. For the full year 2020, INVELTYS prescriptions
grew approximately 11% over the full year 2019.
Kala continues to believe that INVELTYS prescriptions and
revenues will grow over time. However, the Company is unable to
project the specific timing or quantify the specific potential
impact on future revenues given the continued uncertainty around
the impact and duration of the COVID-19 pandemic on elective
procedures, which includes ocular surgeries. Kala expects that net
revenues could continue to be negatively impacted in 2021.
Preclinical Development Program Pipeline: Kala is
progressing a pipeline of preclinical development programs targeted
to address front and back of the eye diseases. These programs, all
of which are new chemical entities (NCEs), include: (1) selective
glucocorticoid receptor modulators (SEGRMs), which are a novel
class of therapies designed to modify the downstream activity of
the glucocorticoid receptor to exhibit the anti-inflammatory and
immunomodulatory properties of corticosteroids while potentially
avoiding the typical safety concerns of steroids; (2) a receptor
Tyrosine Kinase Inhibitor program (rTKI) for the treatment of
retinal diseases, including wet age-related macular degeneration
(wet AMD); and (3) novel steroids designed to target the ocular
surface and thus have the potential to have fewer side effects
compared to traditional topical steroids. Kala owns all
intellectual property and worldwide rights to these pipeline
candidates.
Financial Results:
The financial results below contain both GAAP and non-GAAP
financial measures. The non-GAAP financial measures exclude
stock-based compensation expense and non-cash interest expense and
depreciation and amortization. See “Non-GAAP Financial Measures”
below; for a full reconciliation of Kala’s GAAP to non-GAAP
financial measures, please refer to the tables at the end of this
press release.
- Cash Position: As of December 31,
2020, Kala had cash, cash equivalents and short-term investments of
$153.5 million, compared to $85.4 million as of December 31, 2019.
This increase reflects net proceeds of approximately $158.6 million
received from Kala’s underwritten public offering of common stock
in March 2020 and sales of common stock under its at-the-market
(ATM) offering program in 2020, partially offset by cash used in
operations. Kala anticipates that its cash resources as of December
31, 2020, together with anticipated INVELTYS revenue and the $18.2
million in net proceeds raised in January 2021 under the Company’s
ATM offering program, will enable it to fund its operations into at
least the fourth quarter of 2022. Kala expects anticipated revenue
generated from sales of EYSUVIS to provide additional cash
runway.
Fourth Quarter 2020 Financial Results
- Net Product Revenues: For the
quarter ended December 31, 2020, Kala reported net product revenues
of $2.2 million, consisting of $1.9 million of net revenue from
INVELTYS sales and $0.3 million from EYSUVIS sales, which we began
shipping in late December 2020, compared to $1.2 million from
INVELTYS for the same period in 2019, an increase of $1.0
million.
- Cost of Product Revenues: For the
quarter ended December 31, 2020, cost of product revenues was $1.4
million, compared to $0.7 million for the same period in 2019.
Included in cost of product revenues and due to COVID-19, was a
reserve of $0.5 million for excess inventory of INVELTYS. Non-GAAP
cost of product revenues was $1.3 million for the quarter ended
December 31, 2020, compared to $0.6 million for the same period in
2019.
- SG&A Expenses: For the quarter
ended December 31, 2020, selling, general and administrative
(SG&A) expenses were $26.5 million, compared to $14.5 million
for the same period in 2019. The increase was primarily due to an
increase in costs related to preparation for the launch of EYSUVIS,
including expansion of the sales force, and stock-based
compensation costs. Non-GAAP SG&A expenses were $23.1 million
for the quarter ended December 31, 2020, compared to $12.7 million
for the same period in 2019.
- R&D Expenses: For the quarter
ended December 31, 2020, research and development (R&D)
expenses were $3.4 million, compared to $6.1 million for the same
period in 2019. The decrease was primarily due to a decrease in
external spend on STRIDE 3, Kala’s Phase 3 clinical trial of
EYSUVIS. Non-GAAP R&D expenses were $2.5 million for the
quarter ended December 31, 2020, compared to $5.5 million for the
same period in 2019.
- Operating Loss: For the quarter
ended December 31, 2020, loss from operations was $29.0 million,
compared to $20.2 million for the same period in 2019. Non-GAAP
operating loss was $24.7 million for the quarter ended December 31,
2020, compared to $17.6 million for the same period in 2019.
- Net Loss: For the quarter ended
December 31, 2020, net loss was $31.1 million, or $0.55 per share,
compared to a net loss of $22.0 million, or $0.63 per share, for
the same period in 2019. Non-GAAP net loss was $26.5 million for
the quarter ended December 31, 2020, compared to $19.2 million for
the same period in 2019. The weighted average number of shares used
to calculate net loss per share was 56.9 million for the quarter
ended December 31, 2020, and 34.9 million for the quarter ended
December 31, 2019.
Full Year Ended December 31, 2020 Financial Results
- Net Product Revenues: For the full
year ended December 31, 2020, Kala reported net product revenues of
$6.4 million, consisting of $6.1 million in net revenue from
INVELTYS sales and $0.3 million in net revenue from EYSUVIS sales,
compared to $6.1 million from INVELTYS sales for the same period in
2019, an increase of $0.3 million.
- Cost of Product Revenues: For the
full year ended December 31, 2020, cost of product revenues was
$3.2 million, compared to $2.0 million for the same period in 2019.
Included in cost of product revenues for the full year ended
December 31, 2020, and due to COVID-19, was a reserve of $1.0
million for excess inventory of INVELTYS. Non-GAAP cost of product
revenues was $3.0 million for the full year ended December 31,
2020, compared to $1.7 million for the same period in 2019.
- SG&A Expenses: For the full year
ended December 31, 2020, SG&A expenses were $81.1 million,
compared to $65.0 million for the same period in 2019. The increase
was primarily due to an increase in costs related to preparation
for the launch of EYSUVIS, including expansion of the sales force
and stock-based compensation costs. Non-GAAP SG&A expenses were
$70.3 million for the full year ended December 31, 2020, compared
to $57.6 million for the same period in 2019.
- R&D Expenses: For the full year
ended December 31, 2020, R&D expenses were $18.4 million,
compared to $27.3 million for the same period in 2019. The decrease
was primarily due to a decrease in external spend on STRIDE 3.
Non-GAAP R&D expenses were $15.0 million for the full year
ended December 31, 2020, compared to $24.1 million for the same
period in 2019.
- Operating Loss: For the full year
ended December 31, 2020, loss from operations was $96.2 million,
compared to $88.2 million for the same period in 2019. Non-GAAP
operating loss was $82.0 million for the full year ended December
31, 2020, compared to $77.4 million for the same period in
2019.
- Net Loss: For the full year ended
December 31, 2020, net loss was $104.3 million, or $1.99 per share,
compared to a net loss of $94.3 million, or $2.76 per share, for
the same period in 2019. Non-GAAP net loss was $89.0 million for
the full year ended December 31, 2020, compared to $82.6 million
for the same period in 2019. The weighted average number of shares
used to calculate net loss per share was 52.4 million for the full
year ended December 31, 2020, and 34.2 million for the full year
ended December 31, 2019.
Conference Call Information:
Kala will host a live conference call and webcast today,
February 25, 2021 at 8:00 a.m. ET to review its fourth quarter and
full year 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: 5865513.
To access a subsequent archived recording of the call, please
visit the “Investors” 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 expense and depreciation
and amortization. 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 EYSUVIS:
EYSUVIS (loteprednol etabonate ophthalmic suspension) 0.25% is
approved for the short-term (up to two weeks) treatment of the
signs and symptoms of dry eye disease. EYSUVIS utilizes Kala's
AMPPLIFY mucus-penetrating particle (MPP) Drug Delivery Technology
to enhance penetration of loteprednol etabonate (LE) into target
tissue of the ocular surface. In preclinical studies, the AMPPLIFY
Drug Delivery Technology increased delivery of LE into target
ocular tissues more than three-fold compared to an active LE
comparator by facilitating penetration through the tear film
mucins. EYSUVIS was approved by the FDA on October 26, 2020. Kala
believes that EYSUVIS' broad mechanism of action, rapid onset of
relief of both signs and symptoms, favorable tolerability and
safety profile and the potential to be complementary to existing
therapies, offer a differentiated product profile for the
short-term treatment of dry eye disease, including the management
of dry eye flares.
EYSUVIS, as with other ophthalmic corticosteroids, is
contraindicated in most viral diseases of the cornea and
conjunctiva including epithelial herpes simplex keratitis
(dendritic keratitis), vaccinia, and varicella, and also in
mycobacterial infection of the eye and fungal diseases of ocular
structures. The initial prescription and each renewal of the
medication order should be made by a physician only after
examination of the patient with the aid of magnification, such as
slit lamp biomicroscopy, and, where appropriate, fluorescein
staining. Prolonged use of corticosteroids may result in glaucoma
with damage to the optic nerve, as well as defects in visual acuity
and fields of vision. Corticosteroids should be used with caution
in the presence of glaucoma. Renewal of the medication order should
be made by a physician only after examination of the patient and
evaluation of the IOP. Use of corticosteroids may result in
posterior subcapsular cataract formation. Use of corticosteroids
may suppress the host response and thus increase the hazard of
secondary ocular infections. In acute purulent conditions,
corticosteroids may mask infection or enhance existing infection.
Use of a corticosteroid medication in the treatment of patients
with a history of herpes simplex requires great caution. Use of
ocular corticosteroids may prolong the course and may exacerbate
the severity of many viral infections of the eye (including herpes
simplex). Fungal infections of the cornea are particularly prone to
develop coincidentally with long-term local corticosteroid
application. Fungus invasion must be considered in any persistent
corneal ulceration where a corticosteroid has been used or is in
use. The most common adverse drug reaction following the use of
EYSUVIS for two weeks was instillation site pain, which was
reported in 5% of patients.
Please see full Prescribing Information at www.eysuvis.com
About INVELTYS:
INVELTYS (loteprednol etabonate ophthalmic suspension) 1% is a
twice-a-day corticosteroid for the treatment of post-operative
inflammation and pain following ocular surgery. INVELTYS utilizes
Kala’s proprietary AMPPLIFY mucus-penetrating particle (MPP) Drug
Delivery Technology to enhance penetration of loteprednol etabonate
(LE) into target tissues of the eye. In preclinical studies, the
AMPPLIFY Drug Delivery Technology increased delivery of LE into
target ocular tissues more than three-fold compared to an active LE
comparator by facilitating penetration through the tear film
mucins. INVELTYS was approved by the FDA on August 22, 2018. Kala
believes INVELTYS has a favorable profile for the treatment of
inflammation and pain following ocular surgery, due to its
twice-a-day dosing regimen.
INVELTYS, as with other ophthalmic corticosteroids, is
contraindicated in most viral diseases of the cornea and
conjunctiva including epithelial herpes simplex keratitis
(dendritic keratitis), vaccinia, and varicella, and also in
mycobacterial infection of the eye and fungal diseases of ocular
structures. A prolonged use of corticosteroids may result in
glaucoma with damage to the optic nerve, defects in visual acuity
and fields of vision. If this product is used for 10 days or
longer, IOP should be monitored. Use of corticosteroids may result
in posterior subcapsular cataract formation. Use of steroids after
cataract surgery may delay healing and increase the incidence of
bleb formation. In those diseases causing thinning of the cornea or
sclera, perforations have been known to occur with the use of
topical steroids. The initial prescription and renewal of the
medication order should be made by a physician only after
examination of the patient with the aid of magnification such as
slit lamp biomicroscopy and, where appropriate, fluorescein
staining. Prolonged use of corticosteroids may suppress the host
response and thus increase the hazard of secondary ocular
infections. In acute purulent conditions, steroids may mask
infection or enhance existing infection. Use of a corticosteroid
medication in the treatment of patients with a history of herpes
simplex requires great caution. Use of ocular steroids may prolong
the course and may exacerbate the severity of many viral infections
of the eye (including herpes simplex). Fungal infections of the
cornea are particularly prone to develop coincidentally with
long-term local steroid application. Fungus invasion must be
considered in any persistent corneal ulceration where a steroid has
been used or is in use. In clinical trials, the most common adverse
drug reactions were eye pain (1%) and posterior capsular
opacification (1%). These reactions may have been the consequence
of the surgical procedure.
Please see full Prescribing Information at www.inveltys.com
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 (MPP) Drug Delivery Technology to two
ocular therapies, EYSUVIS™ (loteprednol etabonate ophthalmic
suspension) 0.25% for the short-term (up to two weeks) treatment of
signs and symptoms of dry eye disease and INVELTYS® (loteprednol
etabonate ophthalmic suspension) 1% for the treatment of
post-operative inflammation and pain following ocular surgery. The
Company also has a pipeline of preclinical development programs
targeted to address unmet medical needs, including both front and
back of the eye diseases. For more information on Kala, please
visit www.kalarx.com
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 engaging in contract discussions
with commercial and Medicare Part D health plans and its
expectation to further expand formulary coverage in the coming
weeks and months; the Company’s belief that INVELTYS prescriptions
and revenues will grow over time; the Company’s plans to advance
its preclinical pipeline of programs and the potential benefits of
such programs; and the Company’s expectations regarding its use of
cash, cash runway and anticipated 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 the Company’s sales force
and the market for EYSUVIS and INVELTYS; whether the Company will
be able to successfully implement its commercialization plans for
EYSUVIS and INVELTYS; whether the market opportunity for EYSUVIS
and INVELTYS is consistent with the Company’s expectations and
market research; the Company’s ability execute on the commercial
launch of EYSUVIS on the timeline expected, or at all, including
obtaining Commercial and Medicare Part D payor coverage; 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
EYSUVIS and INVELTYS; 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.
Financial Tables
Kala Pharmaceuticals, Inc.
Balance Sheet Data (in thousands)
(unaudited)
December 31,
December 31,
2020
2019
Cash, cash equivalents and short-term
investments
$
153,540
$
85,449
Total assets
221,606
154,323
Working capital (1)
149,154
80,710
Long‑term debt, net of discounts
72,243
71,184
Other long‑term liabilities
27,143
28,673
Total stockholders’ equity
99,995
29,692
(1) The Company defines working capital as current assets less
current liabilities. See the Company's consolidated financial
statements for further information regarding its current assets and
current liabilities.
Kala Pharmaceuticals, Inc.
Consolidated Statement of Operations (In thousands,
except share and per share data) (Unaudited)
Three Months Ended
December 31,
Year Ended December
31,
2020
2019
2020
2019
Product revenues, net
$
2,238
$
1,180
$
6,362
$
6,074
Costs and expenses:
Cost of product revenues
1,359
747
3,173
2,008
Selling, general and administrative
26,466
14,492
81,068
65,015
Research and development
3,397
6,138
18,352
27,275
Total operating expenses
31,222
21,377
102,593
94,298
Loss from operations
(28,984
)
(20,197
)
(96,231
)
(88,224
)
Other income (expense):
Interest income
42
384
493
2,357
Interest expense
(2,170
)
(2,145
)
(8,589
)
(8,480
)
Net loss
(31,112
)
(21,958
)
(104,327
)
(94,347
)
Net loss per share attributable to common
stockholders—basic and diluted
$
(0.55
)
$
(0.63
)
$
(1.99
)
$
(2.76
)
Weighted average shares outstanding—basic
and diluted
56,923,421
34,899,019
52,377,526
34,209,756
Kala Pharmaceuticals,
Inc.
Reconciliation of GAAP to
Non-GAAP Financial Measures
(In thousands)
(Unaudited)
Three Months Ended
December 31,
Year Ended December
31,
2020
2019
2020
2019
Net loss (GAAP)
$
(31,112
)
$
(21,958
)
$
(104,327
)
$
(94,347
)
Add-back: stock-based compensation
expense
4,063
2,325
13,312
9,991
Add-back: non-cash interest
277
249
1,059
958
Add-back: depreciation and
amortization
238
229
912
843
Non-GAAP net loss
$
(26,534
)
$
(19,155
)
$
(89,044
)
$
(82,555
)
Cost of product revenues (GAAP)
$
1,359
$
747
$
3,173
$
2,008
Less: stock-based compensation expense
32
167
92
268
Less: depreciation and amortization
13
1
52
3
Non-GAAP cost of product revenues
$
1,314
$
579
$
3,029
$
1,737
Selling, general and administrative
expenses (GAAP)
$
26,466
$
14,492
$
81,068
$
65,015
Less: stock-based compensation expense
3,207
1,629
10,137
6,879
Less: depreciation and amortization
171
146
621
522
Non-GAAP selling, general and
administrative expenses
$
23,088
$
12,717
$
70,310
$
57,614
Research and development expenses
(GAAP)
$
3,397
$
6,138
$
18,352
$
27,275
Less: stock-based compensation expense
824
529
3,083
2,844
Less: depreciation and amortization
54
82
239
318
Non-GAAP research and development
expenses
$
2,519
$
5,527
$
15,030
$
24,113
Total operating loss (GAAP)
$
(28,984
)
$
(20,197
)
$
(96,231
)
$
(88,224
)
Add-back: stock-based compensation
expense
4,063
2,325
13,312
9,991
Add-back: depreciation and
amortization
238
229
912
843
Non-GAAP total operating loss
$
(24,683
)
$
(17,643
)
$
(82,007
)
$
(77,390
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210225005229/en/
Investors: Loraine Spreen Loraine.Spreen@kalarx.com
857-277-4842
Hannah Deresiewicz hannah.deresiewicz@sternir.com
212-362-1200
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