Conatus Pharmaceuticals Reports Third Quarter 2019 Financial Results
November 05 2019 - 4:05PM
Conatus Pharmaceuticals Inc. (Nasdaq:CNAT) today announced
financial results for the quarter and nine months ended September
30, 2019.
Recent Developments
In June 2019, Conatus announced that top-line results from its
ENCORE-LF clinical trial of emricasan did not meet its primary
endpoint, and, Conatus and its partner, Novartis, had no further
development plans for emricasan. In September 2019, Conatus and
Novartis mutually agreed to terminate the collaboration agreement
between the parties for the global development and
commercialization of emricasan.
As previously announced, Conatus has engaged Oppenheimer &
Co., Inc., as its financial advisor to assist in the exploration
and evaluation of strategic alternatives to enhance shareholder
value. There can be no assurance of a successful outcome from these
efforts, or of the form or timing of any such outcome.
In connection with the discontinuation of emricasan and Conatus’
efforts to explore and evaluate strategic alternatives, Conatus
announced in June 2019 that it was implementing a restructuring
plan in order to extend its resources, which included reducing
staff and suspending development of its inflammasome disease
candidate, CTS-2090, and in September 2019 it implemented another
restructuring plan in order to extend its resources, which included
further reducing staff.
Financial ResultsThe net loss for the third
quarter of 2019 was $3.3 million compared with $4.6 million for the
third quarter of 2018. The net loss for the first nine months of
2019 was $8.7 million compared with $14.1 million for the first
nine months of 2018.
All revenues were related to the company’s collaboration with
Novartis. Total revenues were $3.4 million for the third quarter of
2019 compared with $7.7 million for the third quarter of 2018.
Total revenues were $21.2 million for the first nine months of 2019
compared with $26.2 million for the first nine months of 2018. The
decreases in revenues for both periods were primarily due to lower
emricasan-related research and development expenses resulting in
corresponding lower revenues from Novartis.
Research and development expenses were $4.7 million for the
third quarter of 2019 compared with $9.7 million for the third
quarter of 2018. The decrease in research and development expenses
was primarily due to lower spending related to emricasan-related
activities. Research and development expenses were $22.7 million
for the first nine months of 2019 compared with $32.5 million for
the first nine months of 2018. These decreases were primarily due
to lower emricasan-related research and development expenses.
General and administrative expenses were $2.0 million for the
third quarter of 2019 compared with $2.7 million for the third
quarter of 2018. General and administrative expenses were $7.7
million for the first nine months of 2019 compared with $8.0
million for the first nine months of 2018. These decreases were
primarily due to lower personnel costs resulting from the
restructuring plan announced in June 2019.
Cash, cash equivalents and marketable securities were $22.7
million at September 30, 2019, compared with $40.7 million at
December 31, 2018. The company is projecting a year-end 2019 net
balance of cash, cash equivalents and marketable securities of
between $10 million and $15 million.
Forward-Looking Statements This press release
contains forward-looking statements within the meaning of Section
21E of the Securities Exchange Act of 1934, as amended. All
statements other than statements of historical facts contained in
this press release are forward-looking statements, including
statements regarding: the company’s potential to successfully
complete a strategic alternative or enhance shareholder value; and
the company’s financial guidance. In some cases, you can identify
forward-looking statements by terms such as “may,” “will,”
“should,” “expects,” “plans,” “anticipates,” “could,” “intends,”
“targets,” “projects,” “contemplates,” “believes,” “estimates,”
“predicts,” “potential” or “continues” or the negative of these
terms or other similar expressions. These forward-looking
statements speak only as of the date of this press release and are
subject to a number of risks, uncertainties and assumptions,
including: whether desirable strategic alternatives can be
identified; and the company’s ability to conserve cash or to
complete a strategic alternative. In addition, if the company does
not or is unable to retain certain remaining personnel, it may be
difficult to complete a transaction. The company’s existing or
future liabilities, including litigation, if any, could also be
seen as detrimental to any potential parties to a strategic
alternative. There can be no assurance that the company will be
able to conserve sufficient cash or complete any transaction. Other
risks regarding the company’s business are described in Conatus’
prior press releases and in the periodic reports it files with the
Securities and Exchange Commission. The events and circumstances
reflected in Conatus’ forward-looking statements may not be
achieved or occur and actual results could differ materially from
those projected in the forward-looking statements. Except as
required by applicable law, Conatus does not plan to publicly
update or revise any forward-looking statements contained herein,
whether as a result of any new information, future events, changed
circumstances or otherwise.
Conatus
Pharmaceuticals Inc. |
Selected
Condensed Financial Information |
(In
thousands, except per share data) |
(Unaudited) |
|
|
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|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Nine Months
Ended |
Statements of Operations |
|
|
September 30, |
|
September 30, |
|
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
Collaboration revenue |
|
|
$ |
3,376 |
|
|
$ |
7,666 |
|
|
$ |
21,191 |
|
|
$ |
26,177 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
Research and development |
|
|
|
4,746 |
|
|
|
9,664 |
|
|
|
22,694 |
|
|
|
32,482 |
|
General and administrative |
|
|
|
2,013 |
|
|
|
2,660 |
|
|
|
7,658 |
|
|
|
7,967 |
|
Total
operating expenses |
|
|
|
6,759 |
|
|
|
12,324 |
|
|
|
30,352 |
|
|
|
40,449 |
|
Loss from
operations |
|
|
|
(3,383 |
) |
|
|
(4,658 |
) |
|
|
(9,161 |
) |
|
|
(14,272 |
) |
Other
income/expense |
|
|
|
130 |
|
|
|
69 |
|
|
|
505 |
|
|
|
168 |
|
Net
loss |
|
|
$ |
(3,253 |
) |
|
$ |
(4,589 |
) |
|
$ |
(8,656 |
) |
|
$ |
(14,104 |
) |
|
|
|
|
|
|
|
|
|
|
Net loss per
share, basic and diluted |
|
|
$ |
(0.10 |
) |
|
$ |
(0.15 |
) |
|
$ |
(0.26 |
) |
|
$ |
(0.47 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding used in computing |
|
|
|
|
|
|
|
|
|
net loss per share, basic and diluted |
|
|
|
33,170 |
|
|
|
30,190 |
|
|
|
33,168 |
|
|
|
30,118 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30, |
|
December
31, |
Balance Sheets |
|
|
|
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash, cash equivalents and marketable securities |
|
|
|
|
|
$ |
22,682 |
|
|
$ |
40,692 |
|
Collaboration receivables |
|
|
|
|
|
|
1,650 |
|
|
|
3,677 |
|
Prepaid and other current assets |
|
|
|
|
|
|
1,179 |
|
|
|
3,057 |
|
Total current assets |
|
|
|
|
|
|
25,511 |
|
|
|
47,426 |
|
Property and equipment, net |
|
|
|
|
|
|
102 |
|
|
|
154 |
|
Other assets |
|
|
|
|
|
|
550 |
|
|
|
1,223 |
|
Total assets |
|
|
|
|
|
$ |
26,163 |
|
|
$ |
48,803 |
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders' equity |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
|
Accounts payable and other current liabilities |
|
|
|
|
|
$ |
3,755 |
|
|
$ |
8,446 |
|
Current
portion of deferred revenue |
|
|
|
|
|
|
|
404 |
|
|
|
10,075 |
|
Total
current liabilities |
|
|
|
|
|
|
|
4,159 |
|
|
|
18,521 |
|
Deferred
revenue, less current portion |
|
|
|
|
|
|
|
- |
|
|
|
2,815 |
|
Other
long-term liabilities |
|
|
|
|
|
|
|
- |
|
|
|
68 |
|
Stockholders' equity |
|
|
|
|
|
|
22,004 |
|
|
|
27,399 |
|
Total liabilities and stockholders' equity |
|
|
|
|
|
$ |
26,163 |
|
|
$ |
48,803 |
|
|
|
|
|
|
|
|
|
|
|
CONTACT: Keith Marshall
Conatus Pharmaceuticals Inc.
(858) 376-2600
IR@conatuspharma.com
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