Otonomy Provides Corporate and Product Pipeline Update
January 03 2019 - 7:30AM
Three programs with clinical trial
results in 2020 including OTIVIDEX™ Phase 3
trial in Ménière’s disease
Otonomy, Inc. (NASDAQ: OTIC), a biopharmaceutical company
dedicated to the development of innovative therapeutics for
neurotology, today provided an update on its product pipeline and
financial guidance. The company expects to have clinical trial
results for three programs in 2020 including the previously
announced Phase 3 trial of OTIVIDEX in Ménière’s disease in the
first half of 2020, Phase 1/2 trial of OTO-313 in tinnitus patients
in the first half of 2020, and Phase 1/2 trial of OTO-413 in
patients with hearing loss in the second half of 2020.
The company finished 2018 with approximately $97 million in
cash, cash equivalents and short term investments that includes
proceeds from a $15 million term loan from Oxford Finance LLC
completed in December 2018. Otonomy expects that its current
capital is sufficient to fund operations through the three clinical
trials and into 2021.
"Otonomy is in a very fortunate position with an ongoing Phase 3
trial for Ménière’s disease, and Phase 1/2 trials for both tinnitus
and hearing loss that will be initiated this year," said David A.
Weber, Ph.D., president and CEO of Otonomy. "Importantly, we have
the financial resources and clinical trial expertise to
successfully complete all three of these trials in 2020, any one of
which would be a meaningful catalyst given the significant affected
patient population, high disease burden, and lack of approved
treatments for these conditions."
Product Pipeline Updates
• |
OTIVIDEX: Phase 3 trial in Ménière’s
disease enrolling patients with results expected in the first half
of 2020. Otonomy has completed one successful Phase 3
trial (AVERTS-2) and is conducting this additional pivotal trial to
support a submission for U.S. registration of OTIVIDEX in Ménière’s
disease. The company plans to enroll approximately 160 patients,
with the design and conduct of this trial based on the AVERTS-2
trial. |
• |
OTO-313: Phase 1/2 trial in tinnitus
patients expected to start in the second quarter of 2019 with
results in the first half of 2020. OTO-313 is an improved
sustained-exposure formulation of the NMDA receptor antagonist
gacyclidine. A Phase 1 study of the initial formulation, OTO-311,
indicated no safety concerns. The Phase 1/2 clinical trial includes
an initial safety cohort followed by an exploratory efficacy study
that will enroll approximately 50 patients with unilateral
tinnitus. A number of exploratory efficacy endpoints will be
assessed following a single intratympanic injection of OTO-313 or
placebo including the Tinnitus Functional Index (TFI), a clinically
validated tinnitus measure. |
• |
OTO-413: Phase 1/2 trial in hearing loss
patients expected to start in the third quarter of 2019 with
results in the second half of 2020. OTO-413 is a
sustained-exposure formulation of brain-derived neurotrophic factor
(BDNF) in development for the repair of cochlear synaptopathy, an
underlying pathology in age-related and noise-induced hearing loss
that manifests as speech-in-noise hearing difficulty (problem
understanding speech in a noisy setting). The Phase 1/2 trial will
enroll approximately 32 hearing loss patients in an ascending dose
design. Patients will receive a single intratympanic injection of
OTO-413 or placebo and be assessed for safety, tolerability, and
multiple exploratory efficacy endpoints. |
• |
OTO-510: IND enabling activities to be initiated for
cisplatin-induced hearing loss (CIHL) otoprotection
program. CIHL is an important unmet medical need with no
approved therapies and approximately 500,000 patients including
5,000 children undergoing chemotherapy with ototoxic platinum-based
agents each year in the United States. The impact on children can
be especially devastating with documented negative effects on
speech development, academic performance and socialization. OTO-510
is a sustained-exposure formulation of an undisclosed small
molecule designed for intratympanic administration to provide
otoprotection without tumor protection. |
• |
OTO-6XX: Development candidate selected
for regenerative hearing loss program. The regeneration of
cochlear hair cells is an active area of research in the
neurotology field because of its potential to improve hearing
function in patients with severe loss. Otonomy has demonstrated
regeneration of hair cells in a nonclinical proof-of-concept model
using a class of small molecules formulated for sustained-exposure
local delivery, and has selected a lead compound for
development. |
• |
OTIPRIO®: Co-promotion partnership with
Mission Pharmacal in acute otitis externa (AOE) proceeding as
planned. Preparations are underway for Mission to launch
OTIPRIO to high volume pediatric and primary care physician offices
in advance of the peak summer season for treating AOE. This
agreement is expected to generate positive OTIPRIO cashflow, which
can provide support for Otonomy's pipeline development
activities. |
Financial Updates and Guidance
• |
Cash Position: Cash, cash equivalents, and
short-term investments totaled approximately $97 million as of
December 31, 2018. This balance includes proceeds from a $15
million term loan provided by Oxford Finance LLC that was completed
in December 2018. The loan provides for a 24 month interest-only
repayment period, followed by 35 months of amortization. The
interest-only period will extend by an additional 12 months,
followed by 23 months of amortization, upon successful results from
the ongoing OTIVIDEX Phase 3 trial. Terms of the loan are provided
in an 8-K filed today with the SEC. There are no financial
covenants or warrants associated with the loan. |
• |
Operating Expense Guidance: |
|
- 2018: Otonomy reaffirms its expectations that
GAAP operating expenses will be in the range of $52-$57 million,
and that non-GAAP operating expenses will be at the lower end of
its $40-$45 million guidance.
- 2019: Otonomy expects that GAAP operating
expenses will be in the range of $55-$60 million, and that non-GAAP
operating expenses will be in the range of $45-$50 million.
- 2020: Otonomy expects that operating expenses
will be lower than 2019 as multiple clinical trials are
completed.
|
|
• |
Cash Runway: Otonomy expects that its current
cash, cash equivalents, and short term investments will be
sufficient to fund the company through completion of the OTIVIDEX
Phase 3 trial, OTO-313 Phase 1/2 trial, and OTO-413 Phase 1/2 trial
in 2020, and will support company operations into 2021. |
|
Non-GAAP Operating Expenses
In this press release, Otonomy’s operating expenses are provided
in accordance with generally accepted accounting principles (GAAP)
in the United States and also on a non-GAAP basis. Non-GAAP
operating expenses exclude stock-based compensation. Non-GAAP
operating expenses are provided as a complement to operating
expenses provided in accordance with GAAP because management
believes non-GAAP operating expenses help indicate underlying
trends in the company’s business, are important in comparing
current results with prior period results and provide additional
information regarding the company’s financial position. Management
also uses non-GAAP operating expenses to establish budgets and
operational goals that are communicated internally and externally
and to manage the company’s business and to evaluate its
performance.
About Otonomy
Otonomy is a biopharmaceutical company dedicated to the
development of innovative therapeutics for neurotology. The company
pioneered the application of drug delivery technology to the ear in
order to develop products that achieve sustained drug exposure from
a single local administration. This approach is covered by a broad
patent estate and is being utilized to develop a pipeline of
products addressing important unmet medical needs including
Ménière’s disease, hearing loss, and tinnitus. For additional
information please visit www.otonomy.com.
Cautionary Note Regarding Forward Looking
Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements generally relate to future events
or the future financial or operating performance of Otonomy.
Forward-looking statements in this press release include, but are
not limited to, timing of results, patient recruitment and
enrollment plans, and trial design and conduct for the Phase 3
clinical trial for OTIVIDEX, timing of results, patient recruitment
and enrollment plans, and trial design and conduct for the Phase
1/2 clinical trial for OTO-313, timing of results, patient
recruitment and enrollment plans, and trial design and conduct for
the Phase 1/2 clinical trial for OTO-413, expectations regarding
IND enabling activities for OTO-510, expectations regarding OTO-6XX
development, the activity under and potential benefits of the
co-promotion agreement between Otonomy and Mission, the benefits of
the loan provided by Oxford Finance LLC and the potential extension
of the interest-only period, expectations regarding operating
expenses for 2018, 2019 and 2020, expectations that current capital
is sufficient to fund operations through the three clinical trials
and into 2021, and statements by Otonomy’s president and CEO.
Otonomy’s expectations regarding these matters may not materialize,
and actual results in future periods are subject to risks and
uncertainties. Actual results may differ materially from those
indicated by these forward-looking statements as a result of these
risks and uncertainties, including but not limited to: Otonomy’s
limited operating history and its expectation that it will incur
significant losses for the foreseeable future; Otonomy’s ability to
accurately forecast financial results; Otonomy’s ability to obtain
additional financing; Otonomy’s dependence on the regulatory
success and advancement of its product candidates; the
uncertainties inherent in the clinical drug development process,
including, without limitation, Otonomy’s ability to adequately
demonstrate the safety and efficacy of its product candidates, the
nonclinical and clinical results for its product candidates, which
may not support further development, and challenges related to
patient enrollment in clinical trials; Otonomy’s ability to obtain
regulatory approval for its product candidates; the risks of the
occurrence of any event, change or other circumstance that could
give rise to the termination of the co-promotion agreement between
Otonomy and Mission; the risks of the occurrence of any event,
change or other circumstance that could impact Otonomy’s ability to
repay or comply with the terms of the loan provided by Oxford
Finance LLC; side effects or adverse events associated with
Otonomy’s product candidates; Otonomy’s ability to successfully
commercialize its product candidates, if approved; competition in
the biopharmaceutical industry; Otonomy’s dependence on third
parties to conduct nonclinical studies and clinical trials;
Otonomy’s dependence on third parties for the manufacture of its
product candidates; Otonomy’s dependence on a small number of
suppliers for raw materials; Otonomy’s ability to protect its
intellectual property related to its product candidates in the
United States and throughout the world; expectations regarding
potential market size, opportunity and growth; Otonomy’s ability to
manage operating expenses; implementation of Otonomy’s business
model and strategic plans for its business, products and
technology; and other risks. Information regarding the foregoing
and additional risks may be found in the section entitled "Risk
Factors" in Otonomy’s Quarterly Report on Form 10-Q filed with the
Securities and Exchange Commission (the "SEC") on November 5, 2018,
and Otonomy’s future reports to be filed with the SEC. The
forward-looking statements in this press release are based on
information available to Otonomy as of the date hereof. Otonomy
disclaims any obligation to update any forward-looking statements,
except as required by law.
Contacts:
Media InquiriesSpectrum ScienceLeticia DiazVice President
202.587.2517ldiaz@spectrumscience.com
Investor InquiriesWestwicke PartnersRobert H. UhlManaging
Director858.356.5932robert.uhl@westwicke.com
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