On track to initiate first Phase 3 trial within
the EMERGENT program by the end of 2020
Topline data from Phase 1b trial in healthy
elderly volunteers expected early in the second quarter of 2021
$344.9 million in cash, cash equivalents and
investment securities expected to fund multiple milestones,
including progressing KarXT to NDA submission, and operations for
at least the next three years
Karuna Therapeutics, Inc. (NASDAQ: KRTX), an innovative
clinical-stage biopharmaceutical company committed to developing
novel therapies with the potential to transform the lives of people
with disabling and potentially fatal neuropsychiatric disorders,
today announced financial results for the third quarter of 2020 and
provided a general business update.
“The end of this year will be transformative for Karuna as we
initiate our Phase 3 EMERGENT program and transition to a
late-stage clinical biotech company,” said Steve Paul, M.D., chief
executive officer, president and chairman of Karuna Therapeutics.
“We continue to grow the organization to support our corporate and
development objectives, and remain focused on simultaneously
advancing our discovery efforts and early- and late-stage clinical
programs evaluating KarXT in neuropsychiatric disorders.”
Pipeline Updates
KarXT, a proprietary oral modulator of muscarinic cholinergic
receptors, is Karuna’s lead product candidate combining xanomeline,
a novel muscarinic agonist, with trospium, a U.S. Food & Drug
Administration (FDA) approved muscarinic antagonist that does not
appreciably cross the blood-brain-barrier, to preferentially
stimulate muscarinic receptors in the central nervous system (CNS).
KarXT is currently being evaluated as a potential treatment for
neuropsychiatric disorders, including schizophrenia and
dementia-related psychosis.
- KarXT in schizophrenia: The Company remains on track to
initiate EMERGENT-2, the first Phase 3 trial within the Company’s
EMERGENT clinical program evaluating KarXT for the treatment of
acute psychosis in adults with schizophrenia, by the end of 2020.
The Company plans to initiate the remaining Phase 3 trials within
the EMERGENT program in the first half of 2021.
- Data highlighting details of efficacy, tolerability and
safety from the Company’s completed Phase 2 trial (EMERGENT-1) will
be presented at the American College of Neuropsychopharmacology
Annual Meeting scheduled for December. The presentation will
include both efficacy and safety data, including new data on the
duration of treatment emergent adverse events of KarXT versus
placebo.
- The Company plans to initiate a Phase 2 trial evaluating
KarXT for the treatment of psychosis in patients with schizophrenia
who have an inadequate response to current standard of care
therapies. The trial will evaluate the efficacy and safety of
KarXT when dosed in conjunction with background antipsychotic
treatment and its potential to improve symptoms in patients who had
not achieved an adequate response on their current antipsychotic
treatment given the unique mechanism of action of KarXT in
comparison to existing standard of care therapies. The Company
plans to start this trial following the initiation of the Phase 3
trials within the EMERGENT program.
- An exploratory endpoint analysis evaluating the impact of
KarXT on cognition in the EMERGENT-1 trial was presented at the
European College of Neuropsychopharmacology Annual Meeting in
September. The analysis demonstrated trends towards
improvements in cognition for patients receiving KarXT relative to
placebo, with larger benefits seen in patients with greater
cognitive impairment at baseline. The Company plans to collect data
on the potential benefit of KarXT on negative and cognitive
symptoms of schizophrenia as part of the EMERGENT program and the
Company’s trial evaluating KarXT in patients who have an inadequate
response to current standard of care therapies, and will continue
to evaluate the timing and design of potential trials specifically
directed towards the negative and cognitive symptoms of
schizophrenia.
- KarXT in dementia-related psychosis: The multi-cohort,
placebo-controlled, inpatient Phase 1b trial evaluating the safety
and tolerability of KarXT in healthy elderly volunteers is ongoing,
with results anticipated early in the second quarter of 2021. The
trial is designed to assess the safety and tolerability of KarXT in
healthy elderly volunteers with the goal of selecting the most
appropriate dose and dose-titration schedule to carry forward into
future studies in patients with dementia-related psychosis.
Business Updates
- Laurie Olson appointed to Board of Directors. In August
2020, the Company’s Board of Directors elected Laurie Olson as a
director and as a member of its nominating and corporate governance
committee. Ms. Olson is a seasoned pharmaceutical executive with
more than 30 years of commercial and corporate strategy experience,
most recently serving as the Executive Vice President, Strategy and
Commercial Operations at Pfizer Inc.
- COVID-19 update. The Company continues to monitor the
impact of COVID-19 across all ongoing and planned clinical trials
and will provide updates on enrollment and completion timelines as
deemed appropriate.
Third Quarter 2020 Financial Results
The Company reported a net loss of $18.8 million for the third
quarter of 2020, as compared to $9.0 million for the prior year
period. The increase in net loss for the period was due to higher
research and development expenses related to the Company’s
preparation for the initiation of the Phase 3 clinical trials
within its EMERGENT program as well as higher general and
administrative expense.
Research and development expenses were $12.6 million for the
third quarter of 2020, as compared to $5.8 million for the prior
year period. The increase in research and development expenses for
the period was primarily driven by expenses related to the
Company’s preparation for the initiation of the Phase 3 clinical
trials within its EMERGENT program, including CRO start-up costs
and clinical trial material manufacturing. The Company also had
additional expenses related to its Phase 1b trial in healthy
elderly volunteers, increased personnel-related costs due to the
increase in employee headcount, as well as expenses associated with
the Company’s discovery programs.
General and administrative expenses were $6.9 million for the
third quarter of 2020, as compared to $4.1 million for the prior
year period. The increase in general and administrative expenses
was primarily due to an increase in personnel-related expenses.
The Company ended the quarter with $344.9 million in cash, cash
equivalents, and available-for-sale investment securities compared
to $389.4 million as of December 31, 2019. The Company expects that
its current cash, cash equivalents, and available-for-sale
investment securities as of September 30, 2020 will enable the
Company to fund its operating expenses and capital expenditure
requirements for at least the next three years. This includes
multiple potential clinical and development milestones, including
an NDA submission of KarXT for the treatment of acute psychosis in
patients with schizophrenia pending the outcomes of the Company’s
planned EMERGENT clinical trials and the completion of the Phase 1b
healthy elderly trial. Additional activities which may be funded
include the initiation of the potential Phase 2 trial for the
treatment of dementia-related psychosis and continued investment
into pipeline expansion, including evaluating KarXT in patients
with schizophrenia who have an inadequate response to standard of
care therapies.
About Karuna
Karuna is a clinical-stage biopharmaceutical company committed
to developing and delivering first-in-class therapies with the
potential to transform the lives of people with CNS disorders –
which remain among the most disabling and potentially fatal
disorders worldwide. Galvanized by the understanding that today’s
neuropsychiatric patients deserve better, Karuna’s mission is to
harness the untapped potential of the brain’s complex biology in
pursuit of novel therapeutic pathways that will advance the
standard of care. For more information, please visit
karunatx.com.
Forward Looking Statements
This press release contains forward looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, including statements regarding our expectations about the
timing of advancing of our planned clinical trials and regulatory
filings, our goals to develop and commercialize our product
candidates, our identification of additional product candidates,
and other statements identified by words such as “could,”
“expects,” “intends,” “may,” “plans,” “potential,” “should,”
“will,” “would,” or similar expressions and the negatives of those
terms. Forward-looking statements are not promises or guarantees of
future performance, and are subject to a variety of risks and
uncertainties, many of which are beyond our control, and which
could cause actual results to differ materially from those
contemplated in such forward-looking statements. These factors
include risks related to our limited operating history, our ability
to obtain necessary funding, our ability to generate positive
clinical trial results for our product candidates, the timing and
scope of regulatory approvals, changes in laws and regulations to
which we are subject, competitive pressures, our ability to
identify additional product candidates, risks relating to business
interruptions resulting from the coronavirus (COVID-19) pandemic,
and other risks set forth under the heading “Risk Factors” of our
Annual Report on Form 10-K for the year ended December 31, 2019 and
our Quarterly Report on Form 10-Q for the quarter ended September
30, 2020. Our actual results could differ materially from the
results described in or implied by such forward-looking statements.
Forward-looking statements speak only as of the date hereof, and,
except as required by law, we undertake no obligation to update or
revise these forward-looking statements.
Karuna Therapeutics, Inc.
Unaudited Consolidated Statements of
Operations
(in thousands, except share and per share
data)
Three Months Ended September
30,
Nine Months Ended September
30,
2020
2019
2020
2019
Revenue
—
—
—
—
Operating expenses:
Research and development
$
12,585
$
5,793
$
27,824
$
19,544
General and administrative
6,944
4,103
19,585
16,995
Total operating expenses
19,529
9,896
47,409
36,539
Loss from operations
(19,529
)
(9,896
)
(47,409
)
(36,539
)
Other income, net:
Interest income
688
858
2,864
1,425
Interest income, net
—
—
—
11
Accretion of debt discount
—
—
—
(945
)
Change in fair value of derivative
—
—
—
(135
)
Total other income, net
688
858
2,864
356
Net loss before income taxes
(18,841
)
(9,038
)
(44,545
)
(36,183
)
Income tax provision
—
—
—
—
Net loss attributable to common
stockholders
$
(18,841
)
$
(9,038
)
$
(44,545
)
$
(36,183
)
Net loss per share, basic and diluted
$
(0.71
)
$
(0.39
)
$
(1.69
)
$
(4.67
)
Weighted average common shares outstanding
used in computing net loss per share, basic and diluted
26,663,968
22,907,349
26,298,969
7,755,137
Karuna Therapeutics, Inc.
Unaudited Consolidated Balance Sheet
Data
(in thousands)
September 30, 2020
December 31, 2019
Cash, cash equivalents and investments
$
344,897
$
389,397
Working capital
356,101
389,748
Total assets
364,436
393,024
Total stockholders’ equity
$
357,259
$
389,916
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201105005066/en/
Investors Alexis Smith 518-338-8990
asmith@karunatx.com
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