Otonomy Announces Plan to Focus Resources on Development Programs
November 27 2017 - 4:30PM
Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company
dedicated to the development of innovative therapeutics for
diseases and disorders of the ear, today announced its plan to
focus resources on the development of multiple clinical and
preclinical programs addressing important unmet medical needs in
otology. In particular, Otonomy intends to complete the clinical
development to support registration of OTIVIDEX in the United
States for patients with Ménière’s disease, and will advance
multiple programs for the prevention and treatment of sensorineural
hearing loss, and the treatment of tinnitus. In order to focus its
resources on pipeline development, the company is immediately
discontinuing commercial support for OTIPRIO (ciprofloxacin otic
suspension) which is expected to significantly reduce future
operating expenses and result in estimated cash savings of more
than $20 million in 2018. Discussions are underway to divest
OTIPRIO.
Key Elements of Business Plan
- Complete Clinical Development of OTIVIDEX for Ménière’s
Disease: As previously announced, the AVERTS-2 Phase 3
trial achieved its primary endpoint (p value = 0.029) with OTIVIDEX
demonstrating clinically significant treatment benefit for patients
with Ménière’s disease. Although this trial was terminated early,
the patient data was collected according to the study protocol and
analyzed according to the statistical analysis plan previously
reviewed by the U.S. Food and Drug Administration (FDA). The
company believes that these actions preserved the integrity of the
clinical trial and that AVERTS-2 meets the requirements to serve as
one of two successful Phase 3 trials requested by the FDA at the
End-of-Phase 2 meeting. The company plans to meet with the FDA
during the first quarter of 2018 to review these results and
discuss remaining clinical requirements for registration of
OTIVIDEX in patients with Ménière’s disease.
- Advance Development of Multiple Programs for Hearing
Loss and Tinnitus: Otonomy plans to continue the
development of multiple programs for the prevention and treatment
of sensorineural hearing loss, and the treatment of tinnitus. The
hearing loss programs, currently in preclinical development,
involve the anatomical and functional repair of ribbon synapses,
protection of hair cells from chemotoxicity, and regeneration of
hair cells. Otonomy is also developing gacyclidine, a potent and
selective NMDA receptor antagonist, for the treatment of tinnitus.
Hearing loss and tinnitus affect large patient populations and are
important unmet medical needs because they have a significant
burden on patients and lack effective treatments.
- Discontinue Commercial Support and Divest
OTIPRIO: Otonomy is eliminating employment positions and
ceasing programs related to the commercialization and market
support of OTIPRIO. This action does not impact the current
approval status of OTIPRIO with the FDA or the ongoing review of
the Supplemental New Drug Application (sNDA) for OTIPRIO in acute
otitis externa. Discussions are underway to divest OTIPRIO, which
will continue to be available for purchase by customers.
- Leverage Cost Savings and Strong Balance Sheet to
Support Plan: Eliminating commercial personnel reduces
Otonomy's headcount to approximately 50, and will reduce future
operating expenses significantly. Including severance payments and
commercial program wind-down costs, total GAAP operating expenses
for 2017 are expected to total in the range of $95-$100 million
with Non-GAAP expenses totaling in the range of $73-$78 million.
Otonomy expects its cash balance including cash, cash equivalents,
and short-term investments to total $118-$123 million at the end of
2017. While Otonomy is not prepared to provide operating expense
guidance for 2018 at this time, eliminating expenses related to
OTIPRIO commercialization is expected to provide cash savings for
the company estimated to total more than $20 million next
year.
"The positive AVERTS-2 results support our continued development
of OTIVIDEX in Ménière’s disease, and the clinically significant
treatment benefit experienced by patients in this trial highlights
the important unmet medical needs that our development pipeline can
address in the untapped field of otology," said David A. Weber,
Ph.D., president and CEO of Otonomy. "Today's announcements outline
our plan to focus resources on advancing our pipeline and to
eliminate the cash burn associated with OTIPRIO commercialization.
With these changes, we believe that our existing cash balance
provides sufficient runway to complete the clinical development
required for U.S. registration of OTIVIDEX in Ménière’s disease and
advance our other programs. We look forward to outlining our
program timelines in the first quarter of 2018," added Dr.
Weber.
About Otonomy
Otonomy is a biopharmaceutical company dedicated to the
development of innovative therapeutics for diseases and disorders
of the ear. 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, the completion of OTIVIDEX registration
requirements and the ability to do so with current funds, the
divestiture of OTIPRIO, cost savings from the discontinuation of
OTIPRIO commercial support, Otonomy’s financial guidance for 2017,
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
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; side effects or
adverse events associated with Otonomy's product candidates;
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 8, 2017,
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 InquiriesCanale CommunicationsHeidi Chokeir, Ph.D.Senior
Vice President619.849.5377heidi@canalecomm.com
Investor InquiriesWestwicke PartnersRobert H. UhlManaging
Director858.356.5932robert.uhl@westwicke.com
Otonomy (NASDAQ:OTIC)
Historical Stock Chart
From Aug 2024 to Sep 2024
Otonomy (NASDAQ:OTIC)
Historical Stock Chart
From Sep 2023 to Sep 2024