Aclaris Therapeutics Reports Second Quarter 2019 Financial Results, Provides Business Strategy Update and Provides Update on ...
August 08 2019 - 4:01PM
Aclaris Therapeutics, Inc. (NASDAQ: ACRS), a physician-led
biopharmaceutical company focused on immuno-inflammatory and
dermatological diseases, today announced its financial results for
the second quarter of 2019, and provided a business strategy update
and an update on its clinical development programs and commercial
products.
Business Strategy Update:
- Aclaris announced that it is undertaking a strategic business
review of its commercial and research and development (R&D)
portfolio of assets to determine how to optimally deploy capital to
maximize shareholder return. As part of this undertaking,
Aclaris today announced the following:
- Today, it is voluntarily discontinuing the commercialization of
ESKATA® (hydrogen peroxide) Topical Solution, 40% (w/w) (ESKATA) in
the United States due to the fact that revenues from product sales
were insufficient for Aclaris to sustain continued
commercialization as a result of the product not achieving
sufficient market acceptance by physicians and patients, and not
for efficacy or safety reasons, and is seeking a strategic partner
to commercialize this product, both in the United States and
worldwide (excluding Canada).
- Aclaris currently intends to seek a strategic partner to
further develop its investigational compounds, ATI-501 (oral) and
ATI-502 (topical) Janus Kinase (JAK) 1/3 inhibitors, for
alopecia.
- Aclaris plans to continue to invest in its other
immuno-inflammatory drug candidates, including its internally
developed investigational candidate ATI-450, an oral MK2 inhibitor.
If Aclaris successfully completes its ongoing Phase 1 clinical
trial for this drug candidate, Aclaris expects to advance ATI-450
into two Phase 2 clinical trials: one for patients with rheumatoid
arthritis (RA) and one for an additional inflammatory
indication.
Highlights:Clinical
- Aclaris’ Investigational New Drug (IND) Application for ATI-450
for the treatment of RA was allowed by the U.S. Food and Drug
Administration (FDA) in May 2019. Aclaris announced today
that the first patient in its Phase 1 clinical trial of ATI-450 has
been dosed. ATI-450 is Aclaris’ first internally developed
novel compound to enter the clinical phase of development.
- In May 2019, Aclaris completed enrollment of its open-label
safety extension Phase 3 clinical trial (WART-303) evaluating the
long-term safety of A-101 45% Topical Solution, an investigational
drug, as a potential treatment for common warts.
- Aclaris recently announced data readouts from multiple Phase 2
clinical trials of ATI-501 and ATI-502.
Commercial and Business
- During the second quarter of 2019, total net revenues were $5.9
million, which included net sales of RHOFADE® (oxymetazoline
hydrochloride) cream, 1% (RHOFADE) of $4.7 million.
- In July 2019, the United States Patent and Trademark Office
(USPTO) issued U.S. Patent No. 10,335,391 covering methods of
treating facial erythema associated with rosacea using a 1.0% w/w
oxymetazoline hydrochloride composition. This issued U.S.
Patent is the sixth patent listed in the Orange Book for RHOFADE
and is set to expire in June 2035.
- In April 2019, the USPTO issued U.S. Patent No. 10,265,258
covering methods of treating alopecia areata (AA) using ruxolitinib
or isotopic forms of ruxolitinib. The claims in this issued patent
cover the use of an effective amount of isotopic forms of
ruxolitinib, such as deuterated ruxolitinib, to treat AA. This
patent is exclusively licensed to Aclaris. This represents the
continued expansion of the IP estate with numerous claims directed
against ruxolitinib, baricitinib, tofacitinib and
decernotinib.
- Maxine Gowen, Ph.D. was appointed to the Board of Directors in
July 2019.
“We have had a busy few months with the continuation of our
commercial relaunch of RHOFADE, generating data from our ATI-501
and ATI-502 trials, and most recently, initiating a Phase 1 trial
with ATI-450, our first internally developed compound,” said Dr.
Neal Walker, President and Chief Executive Officer of
Aclaris. “We look forward to reporting the results of our
Phase 3 wart trials in the second half of this year and providing
further updates on our business strategy review.”
Clinical Pipeline Update:
- A-101 45% Topical Solution:
- Aclaris’ THWART-1 and THWART-2 Phase 3 pivotal clinical trials,
assessing A-101 45% Topical Solution as a potential treatment for
common warts, are progressing as planned. Aclaris has completed
enrollment of more than 1,000 patients across these two trials, and
data for both trials are expected in the second half of 2019.
- An open-label safety extension Phase 3 clinical trial
(WART-303) evaluating the long-term safety of A-101 45% Topical
Solution as a potential treatment for common warts has also
completed enrollment of 425 patients.
- JAK Inhibitor Trials:
- AA-201 Topical – This Phase 2 randomized,
double-blinded, parallel-group, vehicle-controlled trial evaluated
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. In June 2019, Aclaris announced that ATI-502 did
not achieve statistical superiority at the primary or secondary
endpoints in this trial due to high rates of disease resolution in
vehicle-treated patients. Aclaris currently intends to seek a
strategic partner to further develop ATI-502 for this
indication.
- AGA-201 Topical – This ongoing Phase 2
open-label uncontrolled 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 were reported in June
2019 and 12-month data are expected in the fourth quarter of 2019.
If the 12-month data from this trial are positive, Aclaris
currently intends to seek a strategic partner to further develop
ATI-502 for this indication.
- VITI-201 Topical – This ongoing Phase 2
open-label uncontrolled 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.
Although an interim analysis at 6 months demonstrated evidence of
repigmentation in some patients, the response rate has been slow
and not sufficient to be clinically meaningful. ATI-502 has
been observed to be generally well-tolerated and no
treatment-related serious adverse events (SAEs) have been reported
to date. Based on this interim analysis, Aclaris has decided to
discontinue the further development of ATI-502 for this
indication.
- AD-201 Topical – This Phase 2 open-label
uncontrolled clinical trial evaluated the safety and efficacy of
ATI-502, a topical JAK1/3 inhibitor, in 22 adult subjects with
moderate-to-severe atopic dermatitis (AD) (i.e., subjects who had a
Physician’s Global Assessment (PGA) score of 3 or 4 on a 5 point
scale). The primary objective was the assessment of safety
and tolerability of ATI-502. In this trial, ATI-502 was observed to
be generally well-tolerated and no treatment-related SAEs were
reported. 7 of the 17 evaluable subjects, or 41%, met the
secondary endpoint of achieving a PGA score of less than or equal
to 1, with at least a two point change in the PGA score.
- These results suggest that a topical JAK inhibitor
emollient-containing solution may be a viable option for the
treatment of moderate-to-severe AD. As a result, Aclaris intends to
advance ATI-1777, its internally developed investigational topical
soft-JAK inhibitor, as a potential treatment for AD. Aclaris
currently intends to submit an IND for ATI-1777 to the FDA for the
treatment of AD by the end of the first half of 2020 and, if the
IND is allowed by the FDA, to commence a Phase 1/2 clinical trial
in the second half of 2020.
- AUAT-201 Oral – This Phase 2 randomized,
double-blinded, parallel-group, placebo-controlled trial evaluated
the safety, efficacy and dose response of three doses of ATI-501,
an oral JAK 1/3 inhibitor, on the regrowth of hair in 87 subjects
with AA. In July 2019, Aclaris announced that ATI-501 achieved
statistically significant improvement over placebo in several
measures of hair growth, including the primary endpoint and certain
secondary endpoints of this trial. ATI-501 was observed to be
generally well-tolerated at all doses. There were no SAEs
reported. All adverse events (AEs) were mild or moderate in
severity and rates of AEs were similar across all groups. No
thromboembolic events were observed in the trial. The most
common AEs across all groups were: nasopharyngitis, influenza,
upper respiratory tract infection, urinary tract infection, acne,
increased blood creatine phosphokinase, and sinusitis. Two
subjects in each of the placebo and 400 mg groups and one subject
in the 600 mg group had AEs leading to discontinuation of study
drug, with no such AEs in the 800 mg group. Aclaris currently
intends to seek a strategic partner to further develop ATI-501 for
this indication.
- MK2 Inhibitor Trial:
- ATI-450-PKPD-101 – Aclaris’ IND for ATI-450
for the treatment of RA was allowed by the FDA in May 2019. Aclaris
initiated a Single Ascending Dose / Multiple Ascending Dose
pharmacokinetic and pharmacodynamic Phase 1 clinical trial of
approximately 60 subjects, and announced today that the first
patient has been dosed in this trial. If Aclaris successfully
completes the Phase 1 clinical trial, Aclaris expects to advance
ATI-450 into two Phase 2 clinical trials: one in patients with RA
and one in an additional inflammatory indication.
Commercial Update:
- RHOFADE prescriptions for the second quarter of 2019 exceeded
23,200, as estimated per the IQVIA Monthly National Prescription
Audit (NPA) data. This is the highest prescription count in a
calendar quarter since the fourth quarter of 2017 when the product
was owned by Allergan, and represents 12% growth as compared to the
first quarter of 2019.
- New prescriptions for RHOFADE achieved growth of 9% in the
second quarter of 2019 compared to the first quarter, as estimated
per the IQVIA Monthly NPA data.
- Commercial payer coverage for RHOFADE continues to have
coverage for 85% of lives and with unrestricted access for 52% of
commercially insured lives, according to Managed Markets Insight
& Technology data.
- Aclaris today announced that is voluntarily discontinuing the
commercialization of ESKATA in the United States, and is
withdrawing its marketing authorizations it had previously received
for the product in all countries outside of the United States.
Aclaris will continue to maintain the NDA for ESKATA in the United
States, and is currently seeking a strategic partner to
commercialize ESKATA, both in the United States and worldwide
(excluding Canada). Aclaris made this decision due to the
fact that revenues from product sales were insufficient for Aclaris
to sustain continued commercialization as a result of the product
not achieving sufficient market acceptance by physicians and
patients, and not for efficacy or safety reasons.
Financial Highlights:Liquidity and
Capital Resources
As of June 30, 2019, Aclaris had aggregate cash, cash
equivalents and marketable securities of $115.5 million compared to
$168.0 million as of December 31, 2018. For the quarter and six
months ended June 30, 2019, net cash used in operating activities
was $21.4 million and $52.7 million, respectively. As of June 30,
2019, Aclaris had approximately 41.3 million shares of common stock
outstanding.
Aclaris anticipates that its cash, cash equivalents and
marketable securities as of June 30, 2019 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.
Second Quarter 2019 and Year-to-Date Financial
Results
- Net revenues increased to $5.9 million and $10.9 million for
the quarter and six months ended June 30, 2019, compared to $3.7
million and $4.8 million for the quarter and six months ended June
30, 2018.
- Net RHOFADE sales increased to $4.7 million and $8.4 million
for the quarter and six months ended June 30, 2019, respectively.
There were no RHOFADE sales in either prior year period as Aclaris
acquired the rights to the product in the fourth quarter of
2018.
- Net ESKATA sales decreased to $0.3 million for both the quarter
and six months ended June 30, 2019 from $1.5 million of net ESKATA
sales in the quarter and six months ended June 30, 2018.
Aclaris launched ESKATA in May 2018.
- Contract research revenues decreased slightly to $0.9 million
and $2.1 million for the quarter and six months ended June 30,
2019, respectively, compared to $1.1 million and $2.3 million for
the prior year periods.
- A one-time upfront milestone payment of $1.0 million received
from Cipher Pharmaceuticals was recognized as other revenue for the
quarter and six months ended June 30, 2018.
- Cost of revenue, excluding amortization, was $2.7 million and
$5.5 million for the quarter and six months ended June 30, 2019,
compared to $1.2 million and $2.1 million for the quarter and six
months ended June 30, 2018. The amounts for the quarter and
six months ended June 30, 2019 included a $0.4 million non-cash
charge for the write-down of ESKATA finished inventory. Non-cash
amortization expense of the definite-lived intangible asset for
RHOFADE intellectual property was $1.7 million and $3.3 million for
the quarter and six months ended June 30, 2019, respectively. There
was no such expense in either prior year period.
- Aclaris recorded a non-cash goodwill impairment charge of $18.5
million for the quarter and six months ended June 30, 2019 as a
result of recent decline in its stock price. There was no
impairment charge in either prior year period.
- R&D expenses were $17.6 million and $37.5 million for the
quarter and six months ended June 30, 2019, respectively, compared
to $14.0 million and $27.6 million for the quarter and six months
ended June 30, 2018, respectively. The increases were mainly the
result of Aclaris’ Phase 3 trials of A-101 45% Topical Solution for
the treatment of common warts, which Aclaris initiated in the third
quarter of 2018, and preclinical development activities associated
with ATI-450, for which Aclaris recently initiated a Phase 1
clinical trial, along with increased headcount to support these
programs. These increases were offset in part by decreases in
expenses for Aclaris’ JAK inhibitor programs, as several Phase 2
clinical trials of ATI-501 and ATI-502 neared their completion in
2019.
- Sales and marketing (S&M) expenses were $7.2 million and
$17.0 million for the quarter and six months ended June 30, 2019,
respectively, compared to $12.4 million and $23.6 million for the
quarter and six months ended June 30, 2018, respectively. The
decreases of $5.2 million and $6.6 million for the quarter and six
months ended June 30, 2019, respectively, were mainly due to a
reduction in direct marketing and professional fees, which were
incurred last year related to the preparation for the commercial
launch of ESKATA in May 2018. Personnel related costs, including
stock-based compensation, also decreased in 2019 due to turnover in
our sales force during the first half of this year. These decreases
were partially offset by increases in marketing costs for RHOFADE
which were incurred in 2019 to support product re-launch
initiatives.
- General and administrative (G&A) expenses were $8.0 million
and $16.2 million for the quarter and six months ended June 30,
2019, respectively, compared to $8.1 million and $14.4 million for
the quarter and six months ended June 30, 2018, respectively. The
prior year periods included a one-time $1.5 million commercial
milestone payment that we made to a licensor. The increases of $1.4
million and $3.3 million, excluding the milestone payment, were
mainly due to additional professional and legal fees, which
included costs incurred under the transition services agreement
with Allergan related to RHOFADE. Both personnel expenses and
medical affairs activities also increased during the quarter and
six months ended June 30, 2019 in order to support Aclaris’
increased commercial activity since 2018.
- Total costs and expenses for the second quarter of 2019 were
$55.7 million, compared to $35.7 million for the second quarter of
2018. For the six months ended June 30, 2019, total costs and
expenses were $98.0 million, compared to $67.7 million for the same
period in 2018. These amounts included non-cash stock-based
compensation of $4.8 million and $9.7 million for the quarter and
six months ended June 30, 2019, respectively, compared to $5.2
million and $10.4 million for the prior year periods,
respectively.
- Net loss was $49.9 million for the second quarter of 2019,
which included the $18.5 million non-cash goodwill impairment
charge, compared to net loss of $31.2 million for the second
quarter of 2018. Net loss was $87.4 million for the first half of
2019, compared to $61.4 million for the first half of 2018.
2019 Financial Outlook
- Aclaris reiterates that it expects 2019 GAAP R&D expenses
to be in the range of $61 to $64 million, including estimated
stock-based compensation of $7 million.
- Aclaris now expects decreased 2019 GAAP S&M expenses to be
in the range of $32 to $35 million, including stock-based
compensation of $3 million, compared to its original estimate of
$37 to $40 million, including estimated stock-based compensation of
$4 million.
- Aclaris reiterates that it expects 2019 GAAP G&A expenses
to be in the range of $29 to $31 million, including estimated
stock-based compensation of $10 million.
Company to Host Conference CallManagement will
conduct a conference call at 5:00 PM 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
3391498 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
immuno-inflammatory and dermatological 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. For
additional information, please visit www.aclaristx.com and follow
Aclaris on LinkedIn or Twitter @aclaristx.
Cautionary Note Regarding Forward-Looking
StatementsAny 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,” “intend,” “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
Aclaris’ marketed product(s), the clinical development of Aclaris’
drug candidates, including the availability of data from its
ongoing clinical trials, timing for initiation of planned clinical
trials and timing for regulatory submissions, seeking a third-party
partner to commercialize ESKATA and further develop ATI-501 and
ATI-502, the strategic direction of its business, estimated
R&D, S&M and G&A 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 and the commercialization of products,
Aclaris' reliance on third parties over which it may not always
have full control, Aclaris’ ability to enter into strategic
partnerships on commercially reasonable terms 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, the Form 10-Q for the quarter ended June 30, 2019, 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.Condensed Consolidated
Statements of Operations(unaudited, in thousands, except share and
per share data) |
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Revenues: |
|
|
|
|
|
|
|
|
Product sales, net |
|
$ |
4,979 |
|
|
$ |
1,533 |
|
|
$ |
8,757 |
|
|
$ |
1,533 |
|
Contract research |
|
|
886 |
|
|
|
1,143 |
|
|
|
2,149 |
|
|
|
2,261 |
|
Other revenue |
|
|
— |
|
|
|
1,000 |
|
|
|
— |
|
|
|
1,000 |
|
Total revenues, net |
|
|
5,865 |
|
|
|
3,676 |
|
|
|
10,906 |
|
|
|
4,794 |
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
Cost of revenue (excludes amortization) (1) |
|
|
2,703 |
|
|
|
1,181 |
|
|
|
5,480 |
|
|
|
2,148 |
|
Research and development (1) |
|
|
17,622 |
|
|
|
13,984 |
|
|
|
37,541 |
|
|
|
27,590 |
|
Sales and marketing (1) |
|
|
7,177 |
|
|
|
12,368 |
|
|
|
17,008 |
|
|
|
23,601 |
|
General and administrative (1) |
|
|
7,990 |
|
|
|
8,121 |
|
|
|
16,180 |
|
|
|
14,381 |
|
Goodwill impairment |
|
|
18,504 |
|
|
|
— |
|
|
|
18,504 |
|
|
|
— |
|
Amortization of definite-lived intangible |
|
|
1,660 |
|
|
|
— |
|
|
|
3,319 |
|
|
|
— |
|
Total costs and expenses |
|
|
55,656 |
|
|
|
35,654 |
|
|
|
98,032 |
|
|
|
67,720 |
|
Loss from operations |
|
|
(49,791 |
) |
|
$ |
(31,978 |
) |
|
|
(87,126 |
) |
|
|
(62,926 |
) |
Other (expense) income, net |
|
|
(85 |
) |
|
|
760 |
|
|
|
(315 |
) |
|
|
1,479 |
|
Net loss |
|
$ |
(49,876 |
) |
|
$ |
(31,218 |
) |
|
$ |
(87,441 |
) |
|
$ |
(61,447 |
) |
Net loss per share,
basic and diluted |
$ |
(1.21 |
) |
|
$ |
(1.01 |
) |
|
$ |
(2.12 |
) |
|
$ |
(1.99 |
) |
Weighted average
common shares outstanding, basic and diluted |
|
41,274,808 |
|
|
|
30,944,899 |
|
|
|
41,261,808 |
|
|
|
30,915,577 |
|
|
|
|
|
|
|
|
|
(1) Amounts include
stock-based compensation expense as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
$ |
223 |
|
|
$ |
190 |
|
|
$ |
429 |
|
|
$ |
366 |
|
Research and
development |
|
1,721 |
|
|
|
1,756 |
|
|
|
3,315 |
|
|
|
3,483 |
|
Sales and
marketing |
|
216 |
|
|
|
1,020 |
|
|
|
806 |
|
|
|
1,927 |
|
General and
administrative |
|
2,654 |
|
|
|
2,283 |
|
|
|
5,126 |
|
|
|
4,616 |
|
Total stock-based
compensation expense |
$ |
4,814 |
|
|
$ |
5,249 |
|
|
$ |
9,676 |
|
|
$ |
10,392 |
|
|
|
|
|
|
|
|
|
|
Aclaris Therapeutics, Inc.Selected Condensed
Consolidated Balance Sheet Data(unaudited, in thousands) |
|
|
|
|
|
|
|
|
|
|
June 30, 2019 |
|
December 31, 2018 |
|
|
|
|
|
|
|
|
|
Cash, cash equivalents and
marketable securities |
|
$ |
115,517 |
|
$ |
167,972 |
|
Total assets |
|
|
217,239 |
|
|
275,566 |
|
Total current liabilities |
|
|
42,748 |
|
|
27,342 |
|
Total liabilities |
|
|
80,009 |
|
|
60,442 |
|
Total stockholders'
equity |
|
|
137,230 |
|
|
215,124 |
|
|
|
|
|
|
|
|
|
Aclaris ContactMichael Tung, M.D. Senior Vice President
Corporate Strategy/Investor Relations 484-329-2140
mtung@aclaristx.com
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