NDA for Omaveloxolone for Patients With Friedreich’s Ataxia
Under Review With PDUFA Date of February 28, 2023
FDA Does Not Plan to Hold an Advisory Committee Meeting to
Discuss the Omaveloxolone NDA and the Late Cycle Meeting Has Been
Completed
Provides Update on Commercial Preparation
Conference Call With Management on November 8, 2022, at 8:30
A.M. ET
Reata Pharmaceuticals, Inc. (Nasdaq: RETA) (“Reata,” the
“Company,” “our,” “us,” or “we”), a clinical-stage
biopharmaceutical company, today announced financial results for
the third quarter of 2022 and provided an update on the Company’s
business operations and clinical development programs.
Recent Company Highlights
Omaveloxolone in Patients with Friedreich’s Ataxia
In May 2022, the U.S. Food and Drug Administration (“FDA”)
accepted our New Drug Application (“NDA”) for filing and granted
Priority Review for omaveloxolone for patients with Friedreich’s
ataxia. We completed a Mid-Cycle Communication Meeting with the FDA
and submitted additional data and analyses to the FDA after the
meeting. The FDA determined that these submissions were a major
amendment to our NDA and extended the Prescription Drug User Fee
Act (“PDUFA”) date by three months to provide time for a full
review of the new data and analyses. The PDUFA date is now February
28, 2023.
We recently completed a Late-Cycle Meeting with the FDA. The
purpose of the Late-Cycle Meeting is for the FDA to discuss any
substantive issues identified, and the Division’s objectives for
the remainder of the review. The meeting does not address the final
regulatory decision for the NDA. While we have not received formal
minutes from the FDA, in the preliminary agenda for, and during,
the Late-Cycle Meeting, the FDA stated that they continue to review
the analyses and data included in the recent NDA submissions. The
FDA made no request for additional data or analyses but stated that
additional data may be requested as reviews are ongoing. The FDA
confirmed that no information requests were outstanding. The FDA
reiterated that they do not currently plan to hold an advisory
committee meeting.
The FDA stated that no issues related to risk management have
been identified to date. During the meeting, the FDA indicated that
post-marketing requirements and label review are ongoing. With
respect to post-marketing requirements and commitments, FDA stated
that if omaveloxolone is approved, they anticipate requiring a
drug-drug interaction trial with CYP3A4 modulators, a thorough QT
trial, and an evaluation of pregnancy outcomes. FDA stated that
other post-marketing requirements and commitments may be considered
depending on the findings of the review. With respect to label
review, during the meeting we noted that the original proposed
label language did not reflect the data and analyses included in
the amendments to the NDA and that we have updated it in connection
with the planned filing of our Marketing Authorization Application
(“MAA”) in Europe later this year. We committed to submit the
updated proposed label language to the NDA. The FDA indicated that
post-marketing requirements and label comments will be communicated
in early in 2023.
We have advanced our commercial launch preparations in the
United States and are building the infrastructure necessary to
support the commercialization of omaveloxolone for the treatment of
Friedreich’s ataxia, if and when we receive regulatory approval. We
have designed our patient access programs and our product
distribution network. The payer field team has been hired and
deployed. Hiring of the sales leadership team is underway and we
intend to onboard our sales organization and reimbursement
specialists in the first quarter of 2023, pending regulatory
advancement.
We plan to submit an MAA to the European Medicines Agency
(“EMA”) for omaveloxolone this year.
Third Quarter Financial Highlights
Cash and Cash Equivalents
On September 30, 2022, we had cash and cash equivalents and
marketable securities of $435.9 million, as compared to $590.3
million of cash and cash equivalents on December 31, 2021.
GAAP and Non-GAAP Research and Development (“R&D”)
Expenses
R&D expenses according to generally accepted accounting
principles in the U.S. (“GAAP”) were $43.5 million for the third
quarter of 2022, as compared to $39.4 million for the same period
of the year prior.
Non-GAAP R&D expenses were $36.8 million for the third
quarter of 2022, as compared to $34.0 million, for the same period
of the year prior.1
GAAP and Non-GAAP General and Administrative (“G&A”)
Expenses
GAAP G&A expenses were $27.3 million for the third quarter
of 2022, as compared to $25.7 million, for the same period of the
year prior.
Non-GAAP G&A expenses were $19.5 million for the third
quarter of 2022, as compared to $17.5 million for the same period
of the year prior.1
GAAP and Non-GAAP Net Loss
The GAAP net loss for the third quarter of 2022, was $79.0
million, or $2.16 per share, on both a basic and diluted basis, as
compared to a GAAP net loss of $71.8 million, or $1.97 per share,
on both a basic and diluted basis, for the same period of the year
prior.
The non-GAAP net loss for the third quarter of 2022, was $53.9
million, or $1.47 per share on both a basic and diluted basis, as
compared to a non-GAAP net loss of $46.2 million, or $1.27 per
share, on both a basic and diluted basis, for the same period of
the year prior.1
[1]See “Non-GAAP Financial Measures” below for a description of
non-GAAP financial measures and a reconciliation between GAAP and
non-GAAP R&D expenses, GAAP and non-GAAP G&A expenses, and
GAAP and non-GAAP net loss, respectively, appearing later in the
press release.
Cash Guidance
The Company reaffirms that its existing cash and cash
equivalents and marketable debt securities will be sufficient to
enable it to fund operations through the end of 2024.
Non-GAAP Financial Measures
This press release contains non-GAAP financial measures,
including non-GAAP R&D expenses, non-GAAP G&A expenses,
non-GAAP operating expenses, non-GAAP net loss and non-GAAP net
loss per common share – basic and diluted. These measures are not
in accordance with, or an alternative to, GAAP, and may be
different from non-GAAP financial measures used by other
companies.
The Company defines non-GAAP R&D expenses as GAAP R&D
expenses, excluding stock-based compensation expense; non-GAAP
G&A expenses as GAAP G&A expenses, excluding stock-based
compensation expense; non-GAAP operating expenses as GAAP operating
expenses, excluding stock-based compensation expense; non-GAAP net
loss as GAAP net loss, excluding stock-based compensation expense
and non-cash interest expense from liability related to sale of
future royalties; and non-GAAP net loss per common share – basic
and diluted as GAAP net loss per common share – basic and diluted,
excluding stock-based compensation expense and non-cash interest
expense from liability related to sale of future royalties. The
Company has excluded the impact of stock-based compensation
expense, which may fluctuate from period to period based on factors
including the variability associated with performance-based grants
of stock options and restricted stock units and changes in the
Company’s stock price, which impact the fair value of these awards.
The Company has excluded the impact of accreted non-cash interest
expense from liability related to sale of future royalties as it
may be calculated differently from, and therefore may not be
comparable to, peer companies who also provide non-GAAP
disclosures. The Company has excluded the impact of stock-based
compensation expense and non-cash interest expense from liability
related to sale of future royalties because the Company believes
its impact makes it difficult to compare its results to prior
periods and anticipated future periods.
Because management believes certain items, such as stock-based
compensation expense and non-cash interest expense from liability
related to sales of future royalties, can distort the trends
associated with the Company’s ongoing performance, the following
measures are often provided, excluding special items, and utilized
by the Company’s management, analysts, and investors to enhance
consistency and comparability of year-over-year results, as well as
to industry trends, and to provide a basis for evaluating operating
results in future periods: non-GAAP net loss; non-GAAP net loss per
common share – basic and diluted; non-GAAP R&D expenses;
non-GAAP G&A expenses; and non-GAAP operating expenses.
The Company believes the presentation of these non-GAAP
financial measures provides useful information to management and
investors regarding the Company’s financial condition and results
of operations. When GAAP financial measures are viewed in
conjunction with these non-GAAP financial measures, investors are
provided with a more meaningful understanding of the Company’s
ongoing operating performance and are better able to compare the
Company’s performance between periods. In addition, these non-GAAP
financial measures are among those indicators the Company uses as a
basis for evaluating performance, allocating resources, and
planning and forecasting future periods. These non-GAAP financial
measures are not intended to be considered in isolation or as a
substitute for GAAP financial measures. A reconciliation between
these non-GAAP measures and the most directly comparable GAAP
measures is provided later in this press release.
Conference Call Information
Reata’s management will host a conference call on November 8,
2022, at 8:30 am ET. The conference call will be accessible by
dialing (844) 200-6205 (toll-free domestic) or (929) 526-1599
(international) using access code 756839. The webcast link is
https://events.q4inc.com/attendee/378624120.
Third quarter 2022 financial results to be discussed during the
call will be available on the Company’s website shortly before the
call at https://www.reatapharma.com/investors/ and will be
available for 12 months after the call. The audio recording and
webcast of the conference call will be accessible for at least 90
days after the event at https://www.reatapharma.com/investors/.
About Reata
Reata is a clinical-stage biopharmaceutical company that
develops novel therapeutics for patients with serious or
life-threatening diseases by targeting molecular pathways involved
in the regulation of cellular metabolism and inflammation. Reata’s
two most advanced clinical candidates, omaveloxolone and
bardoxolone, target the important transcription factor Nrf2 that
promotes the resolution of inflammation by restoring mitochondrial
function, reducing oxidative stress, and inhibiting
pro-inflammatory signaling. Omaveloxolone and bardoxolone are
investigational drugs, and their safety and efficacy have not been
established by any agency.
Forward-Looking Statements
This press release includes certain disclosures that contain
“forward-looking statements,” including, without limitation,
statements regarding the success, cost and timing of our product
development activities and clinical trials, our plans to research,
develop, and commercialize our product candidates, our plans to
submit regulatory filings, and our ability to obtain and retain
regulatory approval of our product candidates. You can identify
forward-looking statements because they contain words such as
“believes,” “will,” “may,” “aims,” “plans,” “model,” and “expects.”
Forward-looking statements are based on Reata’s current
expectations and assumptions. Because forward-looking statements
relate to the future, they are subject to inherent uncertainties,
risks, and changes in circumstances that may differ materially from
those contemplated by the forward-looking statements, which are
neither statements of historical fact nor guarantees or assurances
of future performance. Important factors that could cause actual
results to differ materially from those in the forward-looking
statements include, but are not limited to, (i) the timing, costs,
conduct, and outcome of our clinical trials and future preclinical
studies and clinical trials, including the timing of the initiation
and availability of data from such trials; (ii) the timing and
likelihood of regulatory filings and approvals for our product
candidates; (iii) whether regulatory authorities determine that
additional trials or data are necessary in order to obtain
approval; (iv) the potential market size and the size of the
patient populations for our product candidates, if approved for
commercial use, and the market opportunities for our product
candidates; and (v) other factors set forth in Reata’s filings with
the U.S. Securities and Exchange Commission, including its Annual
Report on Form 10-K for the fiscal year ended December 31, 2021,
under the caption “Risk Factors.” The forward-looking statements
speak only as of the date made and, other than as required by law,
we undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise.
Three Months Ended
Nine Months Ended
September 30
September 30
2022
2021
2022
2021
Consolidated Statements of
Operations
(unaudited)
(in thousands, except share
and per share data)
Collaboration revenue
License and milestone
$
-
$
5,529
$
1,648
$
7,127
Other revenue
540
1,862
568
3,430
Total collaboration revenue
540
7,391
2,216
10,557
Expenses
Research and development
43,485
39,430
122,620
114,377
General and administrative
27,270
25,736
77,254
68,440
Depreciation
272
320
853
880
Total expenses
71,027
65,486
200,727
183,697
Other income (expense), net
(8,515
)
(13,751
)
(27,858
)
(39,530
)
Loss before taxes on income
(79,002
)
(71,846
)
(226,369
)
(212,670
)
Benefit from (provision for) taxes on
income
-
-
(30
)
669
Net loss
$
(79,002
)
$
(71,846
)
$
(226,399
)
$
(212,001
)
Net loss per share—basic and diluted
$
(2.16
)
$
(1.97
)
$
(6.21
)
$
(5.84
)
Weighted-average number of common shares
used in net loss per share basic and diluted
36,536,919
36,387,560
36,472,903
36,297,766
As of
As of
September 30, 2022
December 31, 2021
(unaudited)
(in thousands)
Condensed Consolidated Balance Sheet
Data
Cash and cash equivalents and marketable
debt securities
$
435,875
$
590,258
Working capital
394,393
542,481
Operating lease right-of-use assets
127,135
126,777
Total assets
583,644
735,016
Liability related to sale of future
royalties, net
392,953
362,142
Operating lease liabilities
140,713
136,033
Deferred revenue
-
1,648
Accumulated deficit
(1,482,030
)
(1,255,631
)
Total stockholders’ equity
$
4,516
$
185,989
Reconciliation of GAAP to Non-GAAP Financial Measures
The following table presents reconciliations of non-GAAP
financial measures to the most directly comparable GAAP financial
measures (in thousands, except for per share data):
Three Months Ended
Nine Months Ended
September 30
September 30
2022
2021
2022
2021
Reconciliation of GAAP to Non-GAAP
Research and development:
(unaudited)
GAAP Research and development
$
43,485
$
39,430
$
122,620
$
114,377
Less: Stock-based compensation expense
(6,684
)
(5,403
)
(20,635
)
(17,474
)
Non-GAAP Research and development
$
36,801
$
34,027
$
101,985
$
96,903
Reconciliation of GAAP to Non-GAAP
General and administrative:
GAAP General and administrative
$
27,270
$
25,736
$
77,254
$
68,440
Less: Stock-based compensation expense
(7,762
)
(8,254
)
(23,119
)
(24,106
)
Non-GAAP General and administrative
$
19,508
$
17,482
$
54,135
$
44,334
Reconciliation of GAAP to Non-GAAP
Operating expenses:
GAAP Operating expense
$
71,027
$
65,486
$
200,727
$
183,697
Less: Stock-based compensation expense
(14,446
)
(13,657
)
(43,754
)
(41,580
)
Non-GAAP Operating expense
$
56,581
$
51,829
$
156,973
$
142,117
Reconciliation of GAAP to Non-GAAP Net
loss:
GAAP Net loss
$
(79,002
)
$
(71,846
)
$
(226,399
)
$
(212,001
)
Add: Stock-based compensation expense
14,446
13,657
43,754
41,580
Add: Non-cash interest expense from
liability related to sale of future royalties
10,664
11,958
30,812
34,312
Non-GAAP Net loss
$
(53,892
)
$
(46,231
)
$
(151,833
)
$
(136,109
)
Reconciliation of GAAP to Non-GAAP Net
loss per common share- basic and diluted:
GAAP Net loss per common share-basic and
diluted
$
(2.16
)
$
(1.97
)
$
(6.21
)
$
(5.84
)
Add: Stock-based compensation expense
0.40
0.38
1.20
1.15
Add: Non-cash interest expense from
liability related to sale of future royalties
0.29
0.32
0.84
0.94
Non-GAAP Net loss per common share-basic
and diluted
$
(1.47
)
$
(1.27
)
$
(4.17
)
$
(3.75
)
Three Months Ended
September 30, 2022
June 30, 2022
March 31, 2022
December 31, 2021
Reconciliation of GAAP to Non-GAAP
Operating expenses
(unaudited)
GAAP Operating expenses
$
71,027
$
64,747
$
64,953
$
72,503
Less: Stock-based compensation expense
(14,446
)
(13,864
)
(15,444
)
(15,226
)
Non - GAAP Operating expenses
$
56,581
$
50,883
$
49,509
$
57,277
Reconciliation of GAAP to Non-GAAP Net
loss
GAAP Net loss
$
(79,002
)
$
(73,555
)
$
(73,842
)
$
(85,385
)
Add: Stock-based compensation expense
14,446
13,864
15,444
15,226
Add: Non-cash interest expense from
liability related to sale of future royalties
10,664
10,277
9,871
12,376
Non-GAAP Net loss
$
(53,892
)
$
(49,414
)
$
(48,527
)
$
(57,783
)
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version on businesswire.com: https://www.businesswire.com/news/home/20221108005485/en/
Reata Pharmaceuticals, Inc. (972) 865-2219
https://www.reatapharma.com/
Investor Relations & Media Relations: John Hunter
ir@reatapharma.com Wendy Segal media@reatapharma.com
https://www.reatapharma.com/contact-us/
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