PIVOTAL TRIALS CARDINAL AND MOXIE FULLY
ENROLLED WITH DATA EXPECTED SECOND HALF 2019
Reata Pharmaceuticals, Inc. (Nasdaq: RETA), a clinical-stage
biopharmaceutical company, today announced financial results for
the fourth quarter and full year ended December 31, 2018, and
provided an update on the Company’s business and product
development programs.
“2018 was a very significant year for Reata,”
said Warren Huff, Reata’s Chief Executive Officer. “We
completed enrollment in two pivotal studies, CARDINAL in Alport
syndrome and MOXIe in Friedreich’s ataxia. We also reported
positive data from three cohorts of the PHOENIX trial in rare forms
of chronic kidney disease (CKD), and announced plans to launch
FALCON, a Phase 3 trial of bardoxolone methyl (bardoxolone) in
patients with autosomal dominant polycystic kidney disease (ADPKD)
during mid-2019.”
Pipeline Highlights
Phase 3 Portion of the CARDINAL Trial of
Bardoxolone in Alport Syndrome
In the second half of 2018, we completed
enrollment in the pivotal Phase 3 CARDINAL study of bardoxolone in
patients with CKD caused by Alport syndrome. A total of 157
patients were enrolled. The FDA has provided us with written
guidance that, in patients with CKD caused by Alport syndrome, an
analysis of retained eGFR demonstrating an improvement versus
placebo after one year of bardoxolone treatment may support
accelerated approval. In July, we reported one-year retained
eGFR data from the open-label Phase 2 portion of CARDINAL, which
demonstrated a statistically significant increase from baseline in
mean eGFR of 4.1 mL/min/1.73 m2 (p<0.05) after 48 weeks of
treatment and four weeks off-treatment in 25 patients.
Available historical data for 22 of these patients showed an
average annual decline in eGFR of 4.2 mL/min/1.73 m2 in the
three-year period prior to study entry. We expect to report
top-line, one-year data from the pivotal Phase 3 portion of
CARDINAL in the second half of this year.
Phase 2 PHOENIX Trial of Bardoxolone in
Rare Forms of Chronic Kidney Disease
During 2018 and the first calendar quarter of
this year, we fully enrolled and reported positive results for all
cohorts of the Phase 2 PHOENIX study in patients with ADPKD, IgA
nephropathy (IgAN), type 1 diabetic CKD (T1D CKD), and focal
segmental glomerulosclerosis (FSGS). In the PHOENIX study
population, bardoxolone demonstrated a statistically significant
improvement from baseline in mean eGFR of 7.8 mL/min/1.73m2
(p<0.00001; n=103) after 12 weeks of treatment. In
addition, each individual cohort demonstrated statistically
significant increases in mean eGFR that represent the recovery of
multiple years of kidney function loss based on historical average
eGFR decline. Based on the results of the ADPKD cohort, we
announced the clinical trial design for FALCON, a Phase 3 study of
bardoxolone for the treatment of patients with ADPKD, and we expect
to dose the first patient in mid-2019. In addition, based on
the eGFR improvements observed in patients across the other cohorts
of PHOENIX, we plan to pursue IgAN, T1D CKD, and FSGS as commercial
indications for bardoxolone.
Registrational Portion of MOXIe Trial of
Omaveloxolone in Friedreich’s Ataxia
We also completed enrollment in the pivotal part
2 portion of the MOXIe Phase 2 study of omaveloxolone in patients
with Friedrich’s ataxia. A total of 103 patients were
enrolled. The FDA has provided us with written guidance that
the mFARS score is acceptable as the primary endpoint for part 2 of
MOXIe and that it may consider either accelerated or full approval
based on the overall results of the trial and strength of the
data. We reported previously that omaveloxolone demonstrated
a statistically significant improvement in modified Friedreich’s
Ataxia Rating Scale (mFARS) scores of 3.8 points (p=0.0001) at the
optimal dose level versus baseline and a placebo-corrected
improvement in mFARS scores of 2.3 points (p=0.06) in part 1 of the
MOXIe trial. We expect to report top-line data from the
pivotal part 2 portion of MOXIe in the second half of this
year.
Registrational Phase 3 CATALYST Trial of
Bardoxolone in CTD-PAH
The Phase 3 CATALYST study for bardoxolone in
connective tissue disease-associated pulmonary arterial
hypertension (CTD-PAH) is ongoing and is expected to enroll a total
of approximately 200 patients. Based on discussion with the
FDA, the primary endpoint of the study is the change from baseline
in six-minute walk distance (6MWD) relative to placebo at Week
24. We expect to report top-line data from CATALYST in the
first half of 2020.
Selected Clinical Milestones in
2019
- Initiation of the pivotal FALCON trial in ADPKD in
mid-2019
- Pivotal CARDINAL data in the second half of 2019
- Pivotal MOXIe data in the second half of 2019
Fourth Quarter Results
The Company incurred total expenses of $33.4
million for the quarter ended December 31, 2018, with research and
development accounting for $25.3 million. This compares to
total expenses of $26.5 million for the same period of the year
prior, when research and development accounted for $20.4
million. We reported a net loss of $25.6 million or $0.86 per
share for the quarter ended December 31, 2018. This compares
to a net loss of $16.7 million or $0.64 per share in the same
period of the year prior.
The increase in net loss for the three-month
period is primarily driven by both an increase in expenses and a
decrease in revenue. Higher expenses are driven by an
increase in research and development expenses due to clinical and
manufacturing activities, and an increase in personnel expenses to
support expanded development activities. Revenue to date has
primarily been related to license, and collaboration agreements
entered into during 2009, 2010, and 2011. The decrease in
revenue was caused primarily by the full recognition in 2017 of
deferred revenue for a 2010 agreement and a decrease in the
recognition of revenue for a 2009 agreement.
2018 Financial Results
The Company incurred total expenses of $130.5
million for the twelve month period ended December 31, 2018, with
research and development accounting for $97.3 million. This
compares to total expenses of $95.0 million for the same period of
the year prior, when research and development accounted for $71.3
million. We reported a net loss of $80.5 million or $2.91 per
share for the full year ended December 31, 2018. This
compares to a net loss of $47.7 million or $1.99 per share in the
same period of the year prior. The increase in net loss for
the year is driven primarily by increased expenses due to greater
clinical and manufacturing activities, development activities for
earlier stage assets to expand our product candidate portfolio, and
personnel expenses to support expanded development activities.
Our cash-based operating expenses, a non-GAAP
measure, were $30.5 million and $119.5 million for the three months
and full year ended December 31, 2018, respectively. This
compares to $24.6 million and $88.0 million for the same periods in
2017. We expect our cash-based operating expenses to continue
to increase in the future as we advance bardoxolone and
omaveloxolone through ongoing and future clinical trials, scale
manufacturing for registrational and validation purposes, advance
other product candidates into mid- and later-stage clinical trials,
expand our product candidate portfolio, increase both our research
and development and administrative personnel, and plan for
commercialization of our product candidates.
At December 31, 2018, we had $337.8 million in
cash and cash equivalents. We expect our current cash to fund
our operations through data readouts for our three ongoing
registrational clinical trials.
Non-GAAP Financial Measures
In addition to the U.S. generally accepted
accounting principles (GAAP) financial highlights, this earnings
release includes cash-based operating expenses, a non-GAAP
financial measure, which the Company defines as total expenses
excluding stock-based compensation expense and depreciation
expense. A reconciliation of this non-GAAP financial measure
to its most directly comparable GAAP financial measure is presented
in the table below in this earnings release.
We believe that this non-GAAP financial measure,
in addition to GAAP financial measures, provides a meaningful
measure of our ongoing business and operating performance by
allowing investors to analyze our financial results similarly to
how management analyzes our financial results by viewing period
expense totals more indicative of effort directly expended to
advance the business and our product candidates. Non-GAAP
financial measures should be considered in addition to, not in
isolation or as a substitute for, GAAP financial measures. In
addition, our non-GAAP financial measure may differ from similarly
named measures used by other companies.
Reata management will host a conference call to
discuss these results on Thursday, February 28, 2019, at 8:00 a.m.
ET at the following:
CONFERENCE CALL
INFORMATION |
Date: |
Thursday, February 28, 2019 |
Time: |
8:00
a.m. ET |
Audience
Dial-in (toll-free): |
(844)
348-3946 |
Audience
Dial-in (international): |
(213)
358-0892 |
Conference ID: |
8569879 |
Webcast
Link: |
https://edge.media-server.com/m6/p/ovw35445 |
|
|
Three Months
Ended |
|
Twelve Months
Ended |
|
|
December 31, |
|
December 31, |
|
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
|
|
|
Consolidated Statements of Operations |
|
(Unaudited) |
|
|
|
(in thousands, except share and per share
data) |
|
Collaboration revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
License and milestone |
|
$ |
7,898 |
|
|
$ |
9,509 |
|
|
$ |
52,351 |
|
|
$ |
47,103 |
|
Other revenue |
|
|
553 |
|
|
|
454 |
|
|
|
1,238 |
|
|
|
955 |
|
Total
collaboration revenue |
|
|
8,451 |
|
|
|
9,963 |
|
|
|
53,589 |
|
|
|
48,058 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
25,308 |
|
|
|
20,443 |
|
|
|
97,288 |
|
|
|
71,273 |
|
General and administrative |
|
|
7,945 |
|
|
|
5,948 |
|
|
|
32,748 |
|
|
|
23,260 |
|
Depreciation |
|
|
120 |
|
|
|
98 |
|
|
|
431 |
|
|
|
437 |
|
Total
expenses |
|
|
33,373 |
|
|
|
26,489 |
|
|
|
130,467 |
|
|
|
94,970 |
|
Other income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income |
|
|
1,755 |
|
|
|
350 |
|
|
|
3,541 |
|
|
|
701 |
|
Interest expense |
|
|
(2,404 |
) |
|
|
(498 |
) |
|
|
(6,176 |
) |
|
|
(1,454 |
) |
Loss on extinguishment of debt |
|
|
- |
|
|
|
- |
|
|
|
(1,007 |
) |
|
|
- |
|
Other income (expense) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(3 |
) |
Total
other income (expense) |
|
|
(649 |
) |
|
|
(148 |
) |
|
|
(3,642 |
) |
|
|
(756 |
) |
Loss
before taxes on income |
|
|
(25,571 |
) |
|
|
(16,674 |
) |
|
|
(80,520 |
) |
|
|
(47,668 |
) |
Provision (benefit) for taxes |
|
|
11 |
|
|
|
- |
|
|
|
26 |
|
|
|
3 |
|
Net
loss |
|
$ |
(25,582 |
) |
|
$ |
(16,674 |
) |
|
$ |
(80,546 |
) |
|
$ |
(47,671 |
) |
Net
loss per share—basic and diluted |
|
$ |
(0.86 |
) |
|
$ |
(0.64 |
) |
|
$ |
(2.91 |
) |
|
$ |
(1.99 |
) |
Weighted-average number of common shares used in net loss per
share basic and diluted |
|
|
29,716,666 |
|
|
|
26,120,324 |
|
|
|
27,701,783 |
|
|
|
23,933,309 |
|
|
|
2018 |
|
2017 |
|
|
|
|
|
|
(in
thousands) |
|
Condensed Consolidated
Balance Sheet Data |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
337,790 |
|
|
$ |
129,780 |
|
Working capital |
|
|
286,353 |
|
|
|
85,492 |
|
Total assets |
|
|
345,208 |
|
|
|
135,337 |
|
Term loan |
|
|
79,219 |
|
|
|
19,614 |
|
Deferred revenue (including
current portion) |
|
|
225,721 |
|
|
|
244,438 |
|
Accumulated deficit |
|
|
(420,323 |
) |
|
|
(337,143 |
) |
Total
stockholders’ equity
(deficit) |
|
$ |
15,159 |
|
|
$ |
(146,973 |
) |
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to
Non-GAAP Financial Measures
The following table presents results for the
three months ending (in thousands) (unaudited):
|
2018 |
|
2017 |
|
YTD
Total |
|
December31 |
|
September30 |
|
June
30 |
|
March
31 |
|
YTD
Total |
|
December31 |
|
September30 |
|
June
30 |
|
March
31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses -
GAAP |
$ |
130,467 |
|
|
$ |
33,373 |
|
|
$ |
34,735 |
|
|
$ |
34,223 |
|
|
$ |
28,136 |
|
|
$ |
94,970 |
|
|
$ |
26,489 |
|
|
$ |
24,575 |
|
|
$ |
24,000 |
|
|
$ |
19,906 |
|
Stock-based compensation
expense |
|
(10,550 |
) |
|
|
(2,768 |
) |
|
|
(2,745 |
) |
|
|
(2,552 |
) |
|
|
(2,485 |
) |
|
|
(6,530 |
) |
|
|
(1,800 |
) |
|
|
(1,545 |
) |
|
|
(1,582 |
) |
|
|
(1,603 |
) |
Depreciation and
amortization |
|
(431 |
) |
|
|
(120 |
) |
|
|
(105 |
) |
|
|
(105 |
) |
|
|
(101 |
) |
|
|
(437 |
) |
|
|
(100 |
) |
|
|
(98 |
) |
|
|
(109 |
) |
|
|
(130 |
) |
Cash-based
operating expenses - Non-GAAP |
$ |
119,486 |
|
|
$ |
30,485 |
|
|
$ |
31,885 |
|
|
$ |
31,566 |
|
|
$ |
25,550 |
|
|
$ |
88,003 |
|
|
$ |
24,589 |
|
|
$ |
22,932 |
|
|
$ |
22,309 |
|
|
$ |
18,173 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change from
previous quarter |
|
|
|
|
$ |
(1,400 |
) |
|
$ |
319 |
|
|
$ |
6,016 |
|
|
$ |
961 |
|
|
|
|
|
|
$ |
1,657 |
|
|
$ |
623 |
|
|
$ |
4,136 |
|
|
$ |
2,497 |
|
Percentage change
from previous quarter |
|
|
|
|
|
-4 |
% |
|
|
1 |
% |
|
|
24 |
% |
|
|
4 |
% |
|
|
|
|
|
|
7 |
% |
|
|
3 |
% |
|
|
23 |
% |
|
|
16 |
% |
About Reata Pharmaceuticals,
Inc.
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, bardoxolone
and omaveloxolone, target the important transcription factor Nrf2
that promotes the resolution of inflammation by restoring
mitochondrial function, reducing oxidative stress, and inhibiting
pro-inflammatory signaling.
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, 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,” 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) 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 (iv) other factors set forth in Reata’s filings
with the U.S. Securities and Exchange Commission, including its
Annual Report on Form 10-K, 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.
Contact:Reata Pharmaceuticals, Inc.(972)
865-2219info@reatapharma.comhttp://news.reatapharma.com
Investor Relations:Vinny JindalVice President,
Strategy(469) 374-8721ir@reatapharma.com
Media:Matt Middleman, M.D.LifeSci Public
Relations(646)
627-8384matt.middleman@lifescipublicrelations.com
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