Market Newsdesk

August 9, 2021 6:49 pm

Everbridge Announces Strong Second Quarter 2021 Financial Results Highlighted by a Record Number of Critical Event Management (CEM) Wins

Everbridge Announces Strong Second Quarter 2021 Financial Results Highlighted by a Record Number of Critical Event Management (CEM) Wins

BURLINGTON, Mass.–(BUSINESS WIRE)–Everbridge, Inc. (NASDAQ: EVBG), the global leader in critical event management (CEM), today announced its financial results for the second quarter ended June 30, 2021.

“We delivered strong second quarter results, building off the momentum we established at the beginning of the year,” said David Meredith, Chief Executive Officer of Everbridge. “Both revenue and profitability exceeded our guidance, and we capitalized on growing demand for our CEM suite and our Public Warning capabilities. We completed a record 19 CEM transactions in the second quarter, which drove a record average selling price in the second quarter. With a growing number of digital and physical critical events, our mission is more important now than ever before. We are looking forward to sustaining our momentum in the second half of the year and our confidence is reflected in our increased guidance for the year, as we continue to execute on our strategy and further penetrate the fast-growing critical event management market.”

Second Quarter 2021 Financial Highlights

Total revenue was $86.6 million, an increase of 33% compared to $65.4 million for the second quarter of 2020.
GAAP operating loss was $(27.4) million, compared to $(14.5) million for the second quarter of 2020.
Non-GAAP operating loss was $(1.9) million, compared to non-GAAP operating income of $1.5 million for the second quarter of 2020.
GAAP net loss was $(33.8) million, compared to $(19.2) million for the second quarter of 2020. GAAP net loss per share was $(0.89), based on 38.0 million basic and diluted weighted average common shares outstanding, compared to $(0.56) for the second quarter of 2020, based on 34.4 million basic and diluted weighted average common shares outstanding.
Non-GAAP net income was $1.5 million, compared to non-GAAP net income of $1.2 million in the second quarter of 2020. Non-GAAP diluted net income per share was $0.03, based on 45.1 million diluted weighted average common shares outstanding, compared to non-GAAP diluted net income per share of $0.03 for the second quarter of 2020, based on 35.7 million diluted weighted average common shares outstanding.
Adjusted EBITDA was $0.5 million, compared to $3.6 million in the second quarter of 2020.
Cash flow from operations was an outflow of $(5.1) million, compared to an outflow of $(3.9) million for the second quarter of 2020.
Free cash flow was an outflow of $(9.0) million, compared to an outflow of $(7.2) million for the second quarter of 2020.

Recent Business Highlights

Ended the second quarter with 5,890 global enterprise customers, up from 5,340 at the end of the second quarter of 2020.
Launched the industry’s first Critical Event Management (CEM) Certification™ Program for assessing an organization’s enterprise resilience, and announced Discover, Goldman Sachs, NBCUniversal, Dow and Alexion among the FORTUNE 500^TM leaders earning the prestigious Best in Enterprise Resilience^TMdesignation through their rigorous CEM Certification^TM benchmarking.
Reinforced Everbridge’s position as a leader in critical event management by hosting the third of our COVID-19: Road to Recovery symposiums which have brought together tens of thousands of executives from 150 countries across business, healthcare, and government. The virtual leadership summit in May featured marquee keynote speakers including the 42^nd President of the United States Bill Clinton, as well as former United States Secretary of State Dr. Madeleine K. Albright,Chairman & Editor-In-Chief of Forbes Media Steve Forbes, Co-Founder of Apollo Global Management and owner of the Philadelphia 76ers Josh Harris, and a special address by Director-General of the World Health Organization (WHO) Dr. Tedros Adhanom Ghebreyesus.

Announced that Estonia, home to 1.3 million residents and a popular destination for 3.2 million annual tourists, and one of the world’s most advanced digital societies, selected Everbridge’s countrywide Public Warning solution to help keep its residents and visitors safe and informed in the event of an emergency.

Successfully deployed Everbridge Public Warning Cell Broadcast technology at three of the largest Mobile Network Operators in the United Kingdom, as a key technology component of the UK Government’s first-ever, nationwide emergency alerting system, planned for rollout later this year.

Announced a next-generation 911 solution designed to improve emergency dispatch in the United States. Through a partnership with RapidSOS, Everbridge 911 Connect™, an extension of the company’s CEM for Public Safety solutions, delivers enhanced location accuracy and provides unique caller identification information on wireless 911 calls, leveraging an expanded life safety database of over 250 million residential and business contacts.

Announced a partnership with Tech Data, a leading global IT distribution and solutions aggregator serving more than 125,000 partners, to help organizations automate the response to, and build resilience against, critical events while opening new routes to market for Everbridge.

Partnered with WizNucleus, a leading provider of cyber and physical security solutions to nuclear and electric grid customers, to increase digital and physical security for some of the world’s largest nuclear, electric, and other utility companies and expand CEM adoption within the energy industry.

Financial Outlook

Based on information available as of today, Everbridge is issuing guidance for the third quarter and full year 2021 as indicated below.

Third Quarter 2021

Full Year 2021

Revenue

$

94.1

to

$

94.5

$

362.8

to

$

363.8

Revenue growth

32

%

33

%

34

%

34

%

GAAP net loss

$

(46.4

)

$

(46.0

)

$

(142.8

)

$

(141.6

)

GAAP net loss per share

$

(1.21

)

$

(1.20

)

$

(3.77

)

$

(3.74

)

Non-GAAP net income (loss)

$

(5.7

)

$

(5.3

)

$

0.5

$

1.7

Non-GAAP net income (loss) per share

$

(0.15

)

$

(0.14

)

$

0.01

$

0.04

Adjusted EBITDA

$

(2.1

)

$

(1.7

)

$

8.0

$

8.8

(All figures in millions, except per share data)

Conference Call Information

What:

Everbridge Second Quarter 2021 Financial Results Conference Call

When:

Monday, August 9, 2021

Time:

4:30 p.m. ET

Live Call:

(833) 685-0904, domestic

(412) 317-5740, international

Replay:

(877) 344-7529, passcode 10158373, domestic

(412) 317-0088, passcode 10158373, international

Webcast (live & replay):

https://edge.media-server.com/mmc/p/oo3cjcx8

About Everbridge, Inc.

Everbridge, Inc. (NASDAQ: EVBG) is a global software company that provides enterprise software applications that automate and accelerate organizations’ operational response to critical events in order to Keep People Safe and Organizations Running™. During public safety threats such as active shooter situations, terrorist attacks or severe weather conditions, as well as critical business events including IT outages, cyber-attacks or other incidents such as product recalls or supply-chain interruptions, over 5,800 global customers rely on the company’s Critical Event Management Platform to quickly and reliably aggregate and assess threat data, locate people at risk and responders able to assist, automate the execution of pre-defined communications processes through the secure delivery to over 100 different communication devices, and track progress on executing response plans. Everbridge serves 8 of the 10 largest U.S. cities, 9 of the 10 largest U.S.-based investment banks, 47 of the 50 busiest North American airports, 9 of the 10 largest global consulting firms, 8 of the 10 largest global automakers, 9 of the 10 largest U.S.-based health care providers, and 7 of the 10 largest technology companies in the world. Everbridge is based in Boston with additional offices in 20 cities around the globe. For more information, visit www.everbridge.com, read the company blog, and follow on Twitter and Facebook.

Non-GAAP Financial Measures

This press release contains the following non-GAAP financial measures: non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross margin, non-GAAP sales and marketing, non-GAAP research and development, non-GAAP general and administrative, non-GAAP operating expenses, non-GAAP operating income/(loss), non-GAAP net income/(loss), non-GAAP net income/(loss) per share, adjusted EBITDA, and free cash flow.

Non-GAAP operating income/(loss) excludes stock-based compensation, change in fair value of contingent consideration and amortization of acquired intangible assets. Non-GAAP net income/(loss) excludes stock-based compensation, change in fair value of contingent consideration, amortization of acquired intangible assets, accretion of interest on convertible senior notes and loss on extinguishment of convertible notes, capped call modification and the tax impact of such adjustments. The tax impact was considered immaterial for fiscal year 2020 and quarters within fiscal year 2020; however, the prior period tax impact presentation has been recast to align with our 2021 reporting presentation. Adjusted EBITDA represents net income/(loss) before interest income and interest expense, income tax expense and benefit, depreciation and amortization expense, loss on extinguishment of convertible notes and capped call modification, change in fair value of contingent consideration and stock-based compensation expense. Free cash flow is cash flow from operations, less cash used for capital expenditures and additions to capitalized software development costs.

We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Everbridge’s financial condition and results of operations. We use these non-GAAP measures for financial, operational and budgetary decision-making purposes, to understand and evaluate our core operating performance and trends, and to generate future operating plans. We believe that these non-GAAP financial measures provide useful information regarding past financial performance and future prospects, and permit us to more thoroughly analyze key financial metrics used to make operational decisions. We believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.

We do not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results. We urge investors to review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures, which are included in this press release, and not to rely on any single financial measure to evaluate our business.

Cautionary Language Concerning Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding the anticipated opportunity and trends for growth in our critical communications and enterprise safety applications and our overall business, our market opportunity, our expectations regarding sales of our products, our goal to maintain market leadership and extend the markets in which we compete for customers, and our expected financial results for the third quarter of 2021 and the full fiscal year 2021. These forward-looking statements are made as of the date of this press release and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond our control. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to: the ability of our products and services to perform as intended and meet our customers’ expectations; our ability to attract new customers and retain and increase sales to existing customers; our ability to increase sales of our Mass Notification application and/or ability to increase sales of our other applications; our ability to successfully integrate businesses and assets that we have acquired or may acquire in the future; the impact of the global COVID-19 pandemic on our operations and those of our customers and suppliers; developments in the market for targeted and contextually relevant critical communications or the associated regulatory environment; our estimates of market opportunity and forecasts of market growth may prove to be inaccurate; we have not been profitable on a consistent basis historically and may not achieve or maintain profitability in the future; the lengthy and unpredictable sales cycles for new customers; nature of our business exposes us to inherent liability risks; our ability to attract, integrate and retain qualified personnel; our ability to maintain successful relationships with our channel partners and technology partners; our ability to manage our growth effectively; our ability to respond to competitive pressures; potential liability related to privacy and security of personally identifiable information; our ability to protect our intellectual property rights, and the other risks detailed in our risk factors discussed in filings with the U.S. Securities and Exchange Commission (“SEC”), including but not limited to our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on February 26, 2021. The forward-looking statements included in this press release represent our views as of the date of this press release. We undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

All Everbridge products are trademarks of Everbridge, Inc. in the USA and other countries. All other product or company names mentioned are the property of their respective owners.

Consolidated Balance Sheets

(in thousands)

(unaudited)

June 30,

December 31,

2021

2020

Current assets:

Cash and cash equivalents

$

559,851

$

467,171

Restricted cash

4,666

4,667

Accounts receivable, net

83,183

94,376

Prepaid expenses

13,301

11,774

Deferred costs and other current assets

21,348

20,464

Total current assets

682,349

598,452

Property and equipment, net

9,567

7,774

Capitalized software development costs, net

18,368

16,329

Goodwill

405,223

187,411

Intangible assets, net

216,723

113,762

Restricted cash

3,785

3,792

Prepaid expenses

1,795

1,943

Deferred costs and other assets

37,214

31,481

Total assets

$

1,375,024

$

960,944

Current liabilities:

Accounts payable

$

10,964

$

9,698

Accrued payroll and employee related liabilities

26,860

27,674

Accrued expenses

10,235

7,246

Deferred revenue

196,481

165,389

Contingent consideration liabilities

18,775

10,619

Other current liabilities

14,376

15,602

Total current liabilities

277,691

236,228

Long-term liabilities:

Deferred revenue, noncurrent

13,509

4,738

Convertible senior notes

646,533

441,514

Deferred tax liabilities

14,022

10,065

Other long-term liabilities

17,940

16,094

Total liabilities

969,695

708,639

Stockholders’ equity:

Common stock

38

35

Additional paid-in capital

752,773

542,776

Accumulated deficit

(348,926

)

(293,316

)

Accumulated other comprehensive income

1,444

2,810

Total stockholders’ equity

405,329

252,305

Total liabilities and stockholders’ equity

$

1,375,024

$

960,944

Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share data)

(unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Revenue

$

86,649

$

65,377

$

168,859

$

124,277

Cost of revenue

27,665

19,423

52,945

40,312

Gross profit

58,984

45,954

115,914

83,965

68.07

%

70.29

%

68.65

%

67.56

%

Operating expenses:

Sales and marketing

41,483

28,741

76,010

58,329

Research and development

20,251

14,937

38,330

29,109

General and administrative

24,664

16,799

47,226

32,710

Total operating expenses

86,398

60,477

161,566

120,148

Operating loss

(27,414

)

(14,523

)

(45,652

)

(36,183

)

Other expense, net:

Interest and investment income

100

235

233

1,808

Interest expense

(9,655

)

(5,998

)

(16,215

)

(11,920

)

Loss on extinguishment of convertible notes and capped call modification

(37

)

—

(2,925

)

—

Other expense, net

(602

)

(438

)

(651

)

(515

)

Total other expense, net

(10,194

)

(6,201

)

(19,558

)

(10,627

)

Loss before income taxes

(37,608

)

(20,724

)

(65,210

)

(46,810

)

Benefit from income taxes

3,787

1,504

9,600

2,205

Net loss

$

(33,821

)

$

(19,220

)

$

(55,610

)

$

(44,605

)

Net loss per share attributable to common stockholders:

Basic

$

(0.89

)

$

(0.56

)

$

(1.49

)

$

(1.30

)

Diluted

$

(0.89

)

$

(0.56

)

$

(1.49

)

$

(1.30

)

Weighted-average common shares outstanding:

Basic

38,014,107

34,402,704

37,204,958

34,238,887

Diluted

38,014,107

34,402,704

37,204,958

34,238,887

Other comprehensive income (loss):

Foreign currency translation adjustment

1,231

2,343

(1,366

)

(4,177

)

Total comprehensive loss

$

(32,590

)

$

(16,877

)

$

(56,976

)

$

(48,782

)

Stock-based compensation expense included in the above:

(in thousands)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Cost of revenue

$

819

$

703

$

1,818

$

1,311

Sales and marketing

5,579

3,917

9,321

7,525

Research and development

2,562

2,298

4,590

4,172

General and administrative

6,545

4,360

12,461

8,580

Total stock-based compensation

$

15,505

$

11,278

$

28,190

$

21,588

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Cash flows from operating activities:

Net loss

$

(33,821

)

$

(19,220

)

$

(55,610

)

$

(44,605

)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation and amortization

13,011

7,320

23,854

13,976

Amortization of deferred costs

3,462

2,813

7,184

5,735

Deferred income taxes

(3,077

)

(1,768

)

(9,778

)

(3,014

)

Accretion of interest on debt

9,508

5,513

15,821

10,949

Loss on extinguishment of convertible notes and capped call modification

37

—

2,925

—

Provision for credit losses and sales reserve

343

462

1,905

1,387

Stock-based compensation

15,505

11,278

28,190

21,588

Other non-cash adjustments

115

—

(32

)

—

Changes in operating assets and liabilities:

Accounts receivable

7,830

2,896

19,312

3,341

Prepaid expenses

299

(208

)

(922

)

(3,265

)

Deferred costs

(4,657

)

(2,223

)

(8,107

)

(6,943

)

Other assets

1,918

640

(850

)

(3,429

)

Accounts payable

851

3,236

(60

)

2,164

Accrued payroll and employee related liabilities

(3,190

)

(3,555

)

(5,320

)

(334

)

Accrued expenses

(2,041

)

(2,325

)

971

(593

)

Deferred revenue

(8,553

)

(7,840

)

(180

)

(2,722

)

Other liabilities

(2,677

)

(889

)

(4,632

)

2,696

Net cash provided by (used in) operating activities

(5,137

)

(3,870

)

14,671

(3,069

)

Cash flows from investing activities:

Capital expenditures

(316

)

(651

)

(2,128

)

(1,175

)

Payments for acquisition of business, net of acquired cash

(165,265

)

(9,324

)

(197,666

)

(44,265

)

Additions to capitalized software development costs

(3,587

)

(2,669

)

(6,082

)

(4,673

)

Net cash used in investing activities

(169,168

)

(12,644

)

(205,876

)

(50,113

)

Cash flows from financing activities:

Proceeds from issuance of convertible notes

—

—

375,000

—

Payments of debt issuance costs

(829

)

—

(10,391

)

(131

)

Purchase of convertible notes capped call hedge

—

—

(35,100

)

—

Repurchase of convertible notes

—

—

(58,641

)

—

Proceeds from termination of convertible notes capped call hedge

—

—

10,650

—

Restricted stock units withheld to settle employee tax withholding liability

(1,233

)

(527

)

(2,843

)

(927

)

Proceeds from employee stock purchase plan

—

—

2,451

1,710

Proceeds from stock option exercises

559

1,596

2,163

4,585

Net cash provided by (used in) financing activities

(1,503

)

1,069

283,289

5,237

Effect of exchange rates on cash, cash equivalents and restricted cash

903

247

588

(419

)

Net increase (decrease) in cash, cash equivalents and restricted cash

(174,905

)

(15,198

)

92,672

(48,364

)

Cash, cash equivalents and restricted cash—beginning of period

743,207

506,496

475,630

539,662

Cash, cash equivalents and restricted cash—end of period

$

568,302

$

491,298

$

568,302

$

491,298

Reconciliation of GAAP measures to non-GAAP measures

(in thousands, except share and per share data)

(unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Cost of revenue

$

27,665

$

19,423

$

52,945

$

40,312

Amortization of acquired intangibles

(2,978

)

(929

)

(5,582

)

(1,668

)

Stock-based compensation

(819

)

(703

)

(1,818

)

(1,311

)

Non-GAAP cost of revenue

$

23,868

$

17,791

$

45,545

$

37,333

Gross profit

$

58,984

$

45,954

$

115,914

$

83,965

Amortization of acquired intangibles

2,978

929

5,582

1,668

Stock-based compensation

819

703

1,818

1,311

Non-GAAP gross profit

$

62,781

$

47,586

$

123,314

$

86,944

Non-GAAP gross margin

72.5

%

72.8

%

73.0

%

70.0

%

Sales and marketing

$

41,483

$

28,741

$

76,010

$

58,329

Stock-based compensation

(5,579

)

(3,917

)

(9,321

)

(7,525

)

Non-GAAP sales and marketing

$

35,904

$

24,824

$

66,689

$

50,804

Research and development

$

20,251

$

14,937

$

38,330

$

29,109

Stock-based compensation

(2,562

)

(2,298

)

(4,590

)

(4,172

)

Non-GAAP research and development

$

17,689

$

12,639

$

33,740

$

24,937

General and administrative

$

24,664

$

16,799

$

47,226

$

32,710

Amortization of acquired intangibles

(6,998

)

(3,798

)

(12,253

)

(7,205

)

Change in fair value of contingent consideration

(15

)

—

(57

)

—

Stock-based compensation

(6,545

)

(4,360

)

(12,461

)

(8,580

)

Non-GAAP general and administrative

$

11,106

$

8,641

$

22,455

$

16,925

Total operating expenses

$

86,398

$

60,477

$

161,566

$

120,148

Amortization of acquired intangibles

(6,998

)

(3,798

)

(12,253

)

(7,205

)

Change in fair value of contingent consideration

(15

)

—

(57

)

—

Stock-based compensation

(14,686

)

(10,575

)

(26,372

)

(20,277

)

Non-GAAP operating expenses

$

64,699

$

46,104

$

122,884

$

92,666

Operating loss

$

(27,414

)

$

(14,523

)

$

(45,652

)

$

(36,183

)

Amortization of acquired intangibles

9,976

4,727

17,835

8,873

Change in fair value of contingent consideration

15

—

57

—

Stock-based compensation

15,505

11,278

28,190

21,588

Non-GAAP operating income (loss)

$

(1,918

)

$

1,482

$

430

$

(5,722

)

Net loss

$

(33,821

)

$

(19,220

)

$

(55,610

)

$

(44,605

)

Amortization of acquired intangibles

9,976

4,727

17,835

8,873

Change in fair value of contingent consideration

15

—

57

—

Stock-based compensation

15,505

11,278

28,190

21,588

Accretion of interest on convertible senior notes

9,508

5,513

15,821

10,949

Loss on extinguishment of convertible notes and

capped call modification

37

—

2,925

—

Income tax adjustments

291

(1,130

)

255

(1,105

)

Non-GAAP net income (loss)

$

1,511

$

1,168

$

9,473

$

(4,300

)

Non-GAAP net income (loss) per share:

Basic

$

0.04

$

0.03

$

0.25

$

(0.13

)

Diluted

$

0.03

$

0.03

$

0.21

$

(0.13

)

Weighted-average common shares outstanding:

Basic

38,014,107

34,402,704

37,204,958

34,238,887

Diluted

45,062,548

35,693,247

44,309,471

34,238,887

Reconciliation of GAAP measures to non-GAAP measures (Continued)

(in thousands)

(unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Net loss

$

(33,821

)

$

(19,220

)

$

(55,610

)

$

(44,605

)

Interest and investment expense, net

9,555

5,763

15,982

10,112

Benefit from income taxes

(3,787

)

(1,504

)

(9,600

)

(2,205

)

Depreciation and amortization

13,011

7,320

23,854

13,976

EBITDA

(15,042

)

(7,641

)

(25,374

)

(22,722

)

Loss on extinguishment of convertible notes and capped call modification

37

—

2,925

—

Change in fair value of contingent consideration

15

—

57

—

Stock-based compensation

15,505

11,278

28,190

21,588

Adjusted EBITDA

$

515

$

3,637

$

5,798

$

(1,134

)

Net cash provided by (used in) operating activities

$

(5,137

)

$

(3,870

)

$

14,671

$

(3,069

)

Capital expenditures

(316

)

(651

)

(2,128

)

(1,175

)

Capitalized software development costs

(3,587

)

(2,669

)

(6,082

)

(4,673

)

Free cash flow

$

(9,040

)

$

(7,190

)

$

6,461

$

(8,917

)

Remaining Performance Obligations as of June 30, 2021

(in millions)

Remaining Performance Obligations

Remaining Performance Obligations

Next Twelve Months

Subscription and other contracts

$

412

$

251

Professional services contracts

12

10

Financial Outlook

(in millions, except share and per share data)

Three Months Ended

Year Ended

September 30, 2021

December 31, 2021

Low End

High End

Low End

High End

Net loss

$

(46.4

)

$

(46.0

)

$

(142.8

)

$

(141.6

)

Amortization of acquired intangibles

11.2

11.2

39.0

39.0

Change in fair value of contingent consideration

—

—

0.1

0.1

Accretion of interest on convertible senior notes

9.7

9.7

35.3

35.3

Loss on extinguishment of convertible notes and

capped call modification

—

—

2.9

2.9

Stock-based compensation

19.8

19.8

66.0

66.0

Non-GAAP net income (loss)

$

(5.7

)

$

(5.3

)

$

0.5

$

1.7

Weighted average common shares outstanding:

Basic

38,300,000

38,300,000

37,900,000

37,900,000

Diluted

38,300,000

38,300,000

38,200,000

38,200,000

Net loss per share

$

(1.21

)

$

(1.20

)

$

(3.77

)

$

(3.74

)

Non-GAAP net income (loss) per share

$

(0.15

)

$

(0.14

)

$

0.01

$

0.04

Net loss

$

(46.4

)

$

(46.0

)

$

(142.8

)

$

(141.6

)

Interest expense, net

9.8

9.8

36.1

36.1

Income taxes, net

—

—

(9.6

)

(9.6

)

Depreciation and amortization

14.7

14.7

55.3

54.9

EBITDA

(21.9

)

(21.5

)

(61.0

)

(60.2

)

Change in fair value of contingent consideration

—

—

0.1

0.1

Loss on extinguishment of convertible notes and capped call modification

—

—

2.9

2.9

Stock-based compensation

19.8

19.8

66.0

66.0

Adjusted EBITDA

$

(2.1

)

$

(1.7

)

$

8.0

$

8.8

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005771/en/

Everbridge Contacts:

Jeff Young

Media Relations

[email protected]

781-859-4116

Joshua Young

Investor Relations

[email protected]

781-236-3695

KEYWORDS: United States North America Massachusetts

INDUSTRY KEYWORDS: Software Networks Internet Data Management Consumer Electronics Technology Mobile/Wireless Security

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Posted on August 9, 2021 6:49 pm
Atara Biotherapeutics Announces Second Quarter 2021 Financial Results and Operational Progress

Atara Biotherapeutics Announces Second Quarter 2021 Financial Results and Operational Progress

Progress with FDA on evaluating tab-cel^® product comparability and new robust Phase 3 ALLELE study data

Recent positive milestones with EMA provide clear path for EU Marketing Authorization Application submission in November 2021

Important new ATA188 magnetization transfer ratio (MTR) imaging biomarker data and updated clinical data to be presented at ECTRIMS in October

Company to Host Live Conference Call and Webcast Today at 4:30 p.m. EDT

SOUTH SAN FRANCISCO, Calif.–(BUSINESS WIRE)–Atara Biotherapeutics, Inc. (Nasdaq: ATRA), a pioneer in T-cell immunotherapy, leveraging its novel allogeneic EBV T-cell platform to develop transformative therapies for patients with cancer and autoimmune diseases, today reported financial results for the second quarter 2021, recent business highlights and key catalysts over the next several months.

“We are very pleased with the progress achieved across all of our programs and important clinical updates across our full pipeline, which will enable us to deliver on key value drivers through the rest of this year and into 2022,” said Pascal Touchon, President and Chief Executive Officer of Atara. “Recent tab-cel^® regulatory progress and alignment with both FDA and EMA allow us to continue anticipating approvals in 2022, while exciting new ATA188 imaging data reinforces our belief in this potentially transformative therapy for patients with multiple sclerosis.”

Tabelecleucel (tab-cel^®) for Post-Transplant Lymphoproliferative Disease (PTLD)

Atara conducted productive meetings with the U.S. Food and Drug Administration (FDA), gaining clarity on specific next steps required for submission of the Biologics License Application (BLA)

Alignment on key methodologies for evaluating comparability between Atara product used in the pivotal ALLELE study and the intended commercial product. Atara will provide data on substantially all lots made to date through a Type B CMC meeting to enable FDA to make a final determination on the data package to support comparability

FDA decided it cannot make a determination of comparability between material used in non-pivotal and pivotal studies because analytical data is not available and cannot be generated for all lots manufactured at Memorial Sloan Kettering Cancer Center (MSK) and used in non-pivotal studies. Consequently, Atara plans to submit clinical data from the pivotal ALLELE study and the non-pivotal studies as separate, non-pooled analyses in the anticipated BLA submission

FDA has not requested additional assays or manufacturing lots

Atara completed a new data analysis from its Phase 3 ALLELE study, as previously discussed with FDA. Top-line data with additional patients confirm a strong objective response rate (ORR) in line with prior results while demonstrating durability. There were no new safety signals, consistent with previously published findings

These data will be discussed with the FDA through a Type B meeting and are planned to be presented at an appropriate congress in Q4 2021

Based on the outcome of the recent and anticipated interactions with the FDA, Atara expects to complete the BLA submission for tab-cel^® in Q1 2022. Atara is adapting investment in U.S. commercial readiness toward anticipated approval in H2 2022

Following recent successful Rapporteur/Co-Rapporteur and pre-submission meetings with the European Medicines Agency (EMA), Atara has completed the necessary regulatory and compliance steps needed to submit an EU Marketing Authorization Application (MAA) for tab-cel^® in patients with EBV⁺ PTLD, which is on track for November 2021. The Company anticipates a decision regarding approval in H2 2022

Discussions with potential partners for the commercialization of tab-cel^® in Europe are advancing well and are in line with our expectation to secure a partner by Q4 2021

Atara presented data at the American Transplant Congress (ATC) in June 2021 from a combined long-term overall survival (OS) analysis from three clinical studies of tab-cel^® demonstrating that patients with EBV⁺ PTLD following solid organ transplant (SOT) that is relapsed or refractory to initial treatment, derived similar OS benefit of greater than 80 percent at two years whether they achieved complete or partial response with tab-cel^®

Tab-cel^® for Potential Additional Indications

Atara continues to pursue development of tab-cel^® in additional patient populations with an initial focus on immunodeficiency-associated lymphoproliferative diseases (IA-LPDs), given the commonality of their EBV-driven mechanism of disease in immunocompromised patients, high unmet medical need, and positive clinical data to date with tab-cel^®

Actively enrolling at sites in the Phase 2 multi-cohort study, which is evaluating six patient populations, including four within IA-PLDs and two in other EBV-driven diseases, in the U.S. and EU

Atara joined the Rare Disease Company Coalition, an alliance of innovative life sciences companies engaging policymakers on the unique needs of the rare disease community, the urgency of and support for innovation to address significant unmet patient need and dialogue around policies that advocate for timely and appropriate access to safe and transformational treatments, including tab-cel^®

ATA188 for Progressive Forms of Multiple Sclerosis (PMS)

Long-term, two-year clinical data from the Phase 1 open-label extension (OLE) and translational data from the Phase 1 study of ATA188 in PMS has been accepted for presentation at the 37^th Congress of the European Committee for Treatment and Research in Multiple Sclerosis (ECTRIMS) in October

The presentation, titled “Updated open-label extension clinical data and new magnetization transfer ratio imaging data from a Phase I study of ATA188, an off-the-shelf, allogeneic Epstein-Barr virus-targeted T-cell immunotherapy for progressive multiple sclerosis” will feature updated clinical and new imaging biomarker data considered to reflect the state of myelination in the central nervous system, known as magnetization transfer ratio (MTR)

MTR may provide important insights into the mechanism of expanded disability status scale (EDSS) improvement in our clinical assessment of ATA188

Atara is making progress on enrolling the ATA188 Phase 2 randomized, double-blind, placebo-controlled trial (EMBOLD study) evaluating the efficacy and safety of ATA188 in patients with PMS

Planned interim analysis in H1 2022 to assess efficacy and safety

Based on current target, Atara expects to complete enrollment in H1 2022

The Company will present a poster on PMS fatigue and an oral presentation on the ongoing EMBOLD study at the upcoming 2021 Annual Meeting of the Consortium of Multiple Sclerosis Centers (CMSC) in October

There is growing awareness of the transformative potential of ATA188 in MS among neurologists

CAR T Programs

ATA2271/ATA3271 (Solid Tumors Over-Expressing Mesothelin)

The global strategic collaboration for ATA2271 and ATA3271 with Bayer continues to progress well with advancement of the mesothelin-partnered CAR T immunotherapy programs

The Company anticipates presentation of the first update on clinical data from the open-label, single-arm Phase 1 clinical study of ATA2271, an autologous CAR T therapy targeting mesothelin, designed to improve efficacy, persistence, and durability of response for patients with advanced mesothelioma, in an appropriate forum in Q4 2021. Enrollment has been completed for the first cohort and is nearly complete for the second cohort of this study

Atara is continuing to make progress on IND-enabling studies for ATA3271, an off-the-shelf, allogeneic CAR T therapy targeting mesothelin using next-generation PD-1 dominant negative receptor (DNR) and 1XX CAR co-stimulatory signaling domain technologies and expects an IND filing in H2 2022

The Company plans to present preclinical data for ATA3271 at an appropriate forum in Q4 2021

ATA3219 (B-cell Malignancies)

Atara expects to submit an IND for ATA3219, an off-the-shelf, allogeneic CD19 CAR T immunotherapy targeting B-cell malignancies, as a potential best-in-class therapy without the need for T-cell receptor (TCR) gene editing, using our next-generation 1XX CAR co-stimulatory signaling domain and EBV T-cell platform in Q1 2022

Executiveand BoardAppointments

Cell therapy and oncology expert, Cokey Nguyen, Ph.D., recently joined Atara as Chief Scientific Officer to further our mission of developing transformative therapies for patients with severe diseases. Dr. Nguyen joined Atara from Fate Therapeutics, where, as Vice President, Innovation, Research and Development, he directed strategy for discovery and innovation efforts, and spearheaded the corporate collaboration program with ONO Pharma

Cell therapy and oncology commercialization veteran, Ameet Mallik, was appointed to the Board of Directors. Mr. Mallik is CEO of Rafael Holdings, a late-stage cancer metabolism therapeutic company and has held several leadership roles at Novartis, most recently as EVP & Head of U.S. Oncology. He brings to Atara’s Board a wealth of experience with U.S. payer, access and reimbursement strategies and launches of innovative oncology therapies, including CAR T

Second Quarter 2021 Financial Results

Cash, cash equivalents and short-term investments as of June 30, 2021 totaled $373.4 million, as compared to $435.2 million as of March 31, 2021

Atara believes that its cash as of June 30, 2021 is sufficient to fund planned operations into 2023

License and collaboration revenue was $3.9 million for the second quarter 2021 and consisted of revenue from activities performed under the Bayer Collaboration Agreements. Atara did not recognize any license and collaboration revenue for the same period in 2020

Net cash used in operating activities was $61.6 million for the second quarter 2021, as compared to $56.6 million for the same period in 2020

Atara reported net losses of $83.8 million, or $0.91 per share, for the second quarter 2021, as compared to $77.5 million, or $1.14 per share, for the same period in 2020

Total operating expenses include non-cash expenses of $16.1 million for the second quarter 2021, as compared to $15.9 million for the same period in 2020

Research and development expenses were $68.5 million for the second quarter 2021, as compared to $61.6 million for the same period in 2020

The increase in the second quarter 2021 was primarily due to higher employee-related costs from increased headcount, increased spending on the Company’s ATA188 and CAR T programs and increased facilities and information technology expenses allocated to research and development

Research and development expenses include $8.3 million of non-cash stock-based compensation expenses for the second quarter 2021, as compared to $8.5 million for the same period in 2020

General and administrative expenses were $19.4 million for the second quarter 2021, as compared to $16.4 million for the same period in 2020

General and administrative expenses include $5.5 million of non-cash stock-based compensation expenses for the second quarter 2021, as compared to $5.4 million for the same period in 2020

Conference Call and Webcast Details

Atara will host a live conference call and webcast today, Monday, August 9, 2021, at 4:30 p.m. EDT to discuss the Company’s financial results and recent operational highlights. Analysts and investors can participate in the conference call by dialing 877-407-8291 for domestic callers and 201-689-8345 for international callers, using the conference ID 13720150. A live audio webcast can be accessed by visiting the Investors & Media – News & Events section of atarabio.com. An archived replay will be available on the Company’s website for 30 days.

About Atara Biotherapeutics, Inc.

Atara Biotherapeutics, Inc. (@Atarabio) is a pioneer in T-cell immunotherapy leveraging its novel allogeneic EBV T-cell platform to develop transformative therapies for patients with serious diseases including solid tumors, hematologic cancers and autoimmune disease. With our lead program in Phase 3 clinical development, Atara is the most advanced allogeneic T-cell immunotherapy company and intends to rapidly deliver off-the-shelf treatments to patients with high unmet medical need. Our platform leverages the unique biology of EBV T cells and has the capability to treat a wide range of EBV-associated diseases, or other serious diseases through incorporation of engineered CARs (chimeric antigen receptors) or TCRs (T-cell receptors). Atara is applying this one platform to create a robust pipeline including: tab-cel^® in Phase 3 development for Epstein-Barr virus-driven post-transplant lymphoproliferative disease (EBV⁺ PTLD) and other EBV-driven diseases; ATA188, a T-cell immunotherapy targeting EBV antigens as a potential treatment for multiple sclerosis; and multiple next-generation chimeric antigen receptor T-cell (CAR T) immunotherapies for both solid tumors and hematologic malignancies. Improving patients’ lives is our mission and we will never stop working to bring transformative therapies to those in need. Atara is headquartered in South San Francisco and our leading-edge research, development and manufacturing facility is based in Thousand Oaks, California. For additional information about the company, please visit atarabio.com and follow us on Twitter and LinkedIn.

Forward-Looking Statements

This press release contains or may imply “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. For example, forward-looking statements include statements regarding: (1) the potential benefits, safety and efficacy of tab-cel^®; the timing and progress of tab-cel^®, including (i) tab-cel^® clinical trials, and the timing and outcome of Atara’s discussions with the FDA regarding a BLA submission for tab-cel^®, (ii) the timing and outcome of Atara’s discussions with EMA regarding an MAA for tab-cel^®, (iii) the timing of the initiation or submission of the BLA and MAA for tab-cel^®, (iv) Atara’s ability to successfully advance the development of tab-cel^®, (v) Atara’s activities in anticipation of potential tab-cel^® approval and commercial launch in the U.S., and (vi) Atara’s efforts to seek a commercialization partner for tab-cel^® in Europe; (2) the potential benefits, safety and efficacy of ATA188; the timing and progress of ATA188, including (i) ATA188 clinical trials, (ii) Atara’s ability to successfully advance the development of ATA188, and (iii) partnering options for ATA188; (3) the timing and progress of its CAR T programs, including (i) ATA2271 clinical trial, (ii) ATA3271 and ATA3219 preclinical development, (iii) progress of the strategic collaboration with Bayer for ATA2271 and 3271, and (iv) Atara’s ability to successfully advance the development of its CAR T programs; and (4) Atara’s ability to advance development of its programs. Because such statements deal with future events and are based on Atara’s current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements of Atara could differ materially from those described in or implied by the statements in this press release. These forward-looking statements are subject to risks and uncertainties, including, without limitation, risks and uncertainties associated with the costly and time-consuming pharmaceutical product development process and the uncertainty of clinical success; the ongoing COVID-19 pandemic, which may significantly impact (i) our business, research, clinical development plans and operations, including our operations in South San Francisco and Southern California and at our clinical trial sites, as well as the business or operations of our third-party manufacturer, contract research organizations or other third parties with whom we conduct business, (ii) our ability to access capital, and (iii) the value of our common stock; the sufficiency of Atara’s cash resources and need for additional capital; and other risks and uncertainties affecting Atara’s and its development programs, including those discussed in Atara’s filings with the Securities and Exchange Commission (SEC), including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings and in the documents incorporated by reference therein. Except as otherwise required by law, Atara disclaims any intention or obligation to update or revise any forward-looking statements, which speak only as of the date hereof, whether as a result of new information, future events or circumstances or otherwise.

Financials

ATARA BIOTHERAPEUTICS, INC.

Consolidated Balance Sheets

(Unaudited)

(In thousands)

June 30,

December 31,

2021

2020

Assets

Current assets:

Cash and cash equivalents

$

123,856

$

200,404

Short-term investments

249,524

300,255

Restricted cash – short-term

194

194

Accounts receivable

—

1,250

Prepaid expenses and other current assets

18,751

21,170

Total current assets

392,325

523,273

Property and equipment, net

51,029

50,517

Operating lease assets

11,548

12,303

Restricted cash – long-term

1,200

1,200

Other assets

689

827

Total assets

$

456,791

$

588,120

Liabilities and stockholders’ equity

Current liabilities:

Accounts payable

$

12,301

$

7,118

Accrued compensation

15,323

20,458

Accrued research and development expenses

12,871

15,813

Deferred revenue

40,968

33,455

Other current liabilities

7,367

6,057

Total current liabilities

88,830

82,901

Deferred revenue – long-term

22,470

27,795

Operating lease liabilities – long-term

12,182

13,041

Other long-term liabilities

1,771

2,044

Total liabilities

125,253

125,781

Commitments and contingencies

Stockholders’ equity:

Common stock

8

8

Additional paid-in capital

1,618,177

1,586,616

Accumulated other comprehensive income

62

296

Accumulated deficit

(1,286,709

)

(1,124,581

)

Total stockholders’ equity

331,538

462,339

Total liabilities and stockholders’ equity

$

456,791

$

588,120

ATARA BIOTHERAPEUTICS, INC.

Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(In thousands, except per share amounts)

Three Months Ended June 30,

Six Months Ended June 30,

2021

2020

2021

2020

License and collaboration revenue

$

3,870

$

—

$

7,422

$

—

Operating expenses:

Research and development

68,475

61,560

132,534

119,219

General and administrative

19,397

16,392

37,135

33,430

Total operating expenses

87,872

77,952

169,669

152,649

Loss from operations

(84,002

)

(77,952

)

(162,247

)

(152,649

)

Interest and other income, net

225

497

135

1,685

Loss before provision for income taxes

(83,777

)

(77,455

)

(162,112

)

(150,964

)

Provision for income taxes

16

1

16

1

Net loss

$

(83,793

)

$

(77,456

)

$

(162,128

)

$

(150,965

)

Other comprehensive gain (loss):

Unrealized gain (loss) on available-for-sale securities

(99

)

606

(234

)

590

Comprehensive loss

$

(83,892

)

$

(76,850

)

$

(162,362

)

$

(150,375

)

Net loss per common share:

Basic and diluted net loss per common share

$

(0.91

)

$

(1.14

)

$

(1.77

)

$

(2.34

)

Weighted-average shares outstanding used to calculate basic and diluted net loss per common share

92,152

67,975

91,806

64,592

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005755/en/

Investors

Eric Hyllengren

805-395-9669

[email protected]

Media

Alex Chapman

805-456-4772

[email protected]

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Research Genetics Clinical Trials Other Health Biotechnology Pharmaceutical Health Science Oncology Other Science

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Posted on August 9, 2021 6:49 pm
Fulgent Genetics and Helio Health Announce Strategic Partnership to Commercialize Early Cancer Detection Tests

Fulgent Genetics and Helio Health Announce Strategic Partnership to Commercialize Early Cancer Detection Tests

Partnership enables broad reach of cfDNA methylation blood tests for early cancer detection

TEMPLE CITY, Calif. & IRVINE, Calif.–(BUSINESS WIRE)–
Fulgent Genetics, Inc. (NASDAQ: FLGT) (“Fulgent” or the “Company”), a technology-based genetic testing company focused on transforming patient care in oncology, infectious and rare diseases, and reproductive health, and Helio Health (“Helio”), an AI-biotechnology company developing blood-based early cancer detection tests, today announced the companies have entered into a strategic partnership to commercialize Helio’s blood-based early cancer detection tests. In conjunction with the commercial strategic partnership whereby the company has secured exclusive commercial rights for laboratory develop tests (“LDTs”) in the U.S. and Canada, Fulgent has made a strategic investment in Helio.

Under this partnership, the companies will initially commercialize and co-brand HelioLiver, a cell-free DNA (cfDNA) methylation blood test that incorporates protein markers and demographics for the detection of hepatocellular carcinoma (HCC) – or liver cancer. HelioLiver is currently undergoing clinical trials in the U.S. and China. Fulgent will be responsible for laboratory operations, supply chain operations, and marketing and sales leveraging its operational excellence and significant market reach, initially focused in the U.S. and Canada. Helio will provide intellectual property and continued support across research and development, publication development, market access and sales, as well as reimbursement operations. Fulgent and Helio will also work together on the development of additional liquid biopsy tests for different types of cancer in the future.

Liver cancer is the fastest growing and second deadliest cancer worldwide. According to the American Cancer Society, liver cancer incidence rates have more than tripled since 1980, while the death rates have more than doubled during this time. Studies show that early detection of liver cancer is critical to successful outcomes with a survival rate that is 12 times higher if caught in early versus late stages.

Helio’s new approach to detecting cancer with cfDNA methylation technology has the potential to provide a paradigm shift in the way the disease is diagnosed and monitored. The companies expect to launch HelioLiver this calendar year.

“We are very excited to partner with Helio to offer Helio’s liquid biopsy test for early cancer detection,” said Dr. Larry Weiss, Chief Medical Officer at Fulgent. “Helio has demonstrated that its liquid biopsy test offers significantly better accuracy relative to other test methods for early cancer detection. Helio’s methylation-based capabilities will supplement Fulgent’s comprehensive test menu across oncology, infectious and rare diseases, and reproductive health.”

“We are pleased to be working with Helio on the development and commercialization of its liquid biopsy testing capabilities,” said Dr. Harry Gao, Chief Scientific Officer at Fulgent. “In addition to testing for liver cancer, Fulgent and Helio will work to develop early screening for other types of cancers using Helio’s methylation-based technologies. This research and development opportunity will further expand Fulgent’s capabilities in liquid biopsy and oncology testing.”

“Partnering with Fulgent furthers our mission to save lives by dramatically improving the current standard of care methods of early cancer detection,” said Justin Chen Li, CEO of Helio USA. “Fulgent’s strong commercial capabilities will enable us to solidify quick adoption of the HelioLiver test in the U.S. and Canada, with the option to expand globally.”

“Fulgent and Helio are very complementary in products, technology, operations, marketing and sales,” said Albert Zhang, CEO of Helio China. “With the strategic partnership, I’m looking forward to further accelerating the commercial plan of both companies.”

About Fulgent Genetics

Fulgent Genetics is a technology-based genetic testing company focused on transforming patient care in oncology, infectious and rare diseases, and reproductive health. Fulgent’s proprietary technology platform has created a broad, flexible test menu and the ability to continually expand and improve its proprietary genetic reference library while maintaining accessible pricing, high accuracy, and competitive turnaround times. Combining next generation sequencing (“NGS”) with its technology platform, the Company performs full-gene sequencing with deletion/duplication analysis in an array of panels that can be tailored to meet specific customer needs. A cornerstone of the Company’s business is its ability to provide expansive options and flexibility for all clients’ unique testing needs through a comprehensive technology offering including cloud computing, pipeline services, record management, web portal services, clinical workflow, sequencing as a service, and automated lab services.

About Helio Health

Helio Health is an AI-driven biotechnology company focused on commercializing early cancer detection tests from a simple blood draw. The company’s mission is to saving lives by detecting cancer early. With Helio’s AI-driven technology, both physicians and their patients gain powerful insights from accurate, accessible, and convenient blood tests, dramatically improving the current standard care cancer early detection methods.

Building on a robust research and development program, and with access to tens of thousands of patient samples, the company is currently in clinical trials in the U.S. and China with its lead liver cancer detection test. Helio’s development program is focused on liver, colon, lung, breast, and other types of cancers.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements in this press release include statements about, among other things: management’s and others’ beliefs, judgments and estimates regarding the development and potential commercialization of Helio’s products and product candidates, including the timing of this development and any related regulatory approval; the benefits and opportunities relating to or arising from Fulgent’s investment and Fulgent and Helio’s collaborations arrangements; Fulgent’s testing solutions and services; the Company’s identification and evaluation of opportunities and its ability to capitalize on opportunities to grow its business.

Forward-looking statements are statements other than historical facts and relate to future events or circumstances or the Company’s future performance, and they are based on management’s current assumptions, expectations and beliefs concerning future developments and their potential effect on the Company’s business. These forward-looking statements are subject to a number of risks and uncertainties, which may cause the forward-looking events and circumstances described in this press release to not occur, and actual results to differ materially and adversely from those described in or implied by the forward-looking statements. These risks and uncertainties include, among others: risks that the tests developed by Helio will not be effective or achieve commercial success; the ongoing impacts of the COVID-19 pandemic, including the preventive public health measures that may continue to impact demand for its tests and the pandemic’s effects on the global supply chain; the market potential for, and the rate and degree of market adoption of, the Company’s tests, including its newly-developed tests for COVID-19 and genetic testing generally; the Company’s ability to capture a sizable share of the developing market for genetic and COVID-19 testing and to compete successfully in these markets, including its ability to continue to develop new tests that are attractive to its various customer markets, its ability to maintain turnaround times and otherwise keep pace with rapidly changing technology; the Company’s ability to successfully integrate acquired businesses and assets into its business strategy and to derive value from its investments; the Company’s ability to maintain the low internal costs of its business model, particularly as the Company makes investments across its business; the Company’s ability to maintain an acceptable margin on sales of its tests, particularly in light of increasing competitive pressures and other factors that may continue to reduce the Company’s sale prices for and margins on its tests; risks related to volatility in the Company’s results, which can fluctuate significantly from period to period; risks associated with the composition of the Company’s customer base, which can fluctuate from period to period and can be comprised of a small number of customers that account for a significant portion of the Company’s revenue; the Company’s ability to grow and diversify its customer base and increase demand from existing and new customers; the Company’s investments in its infrastructure, including its sales organization and operational capabilities, and the extent to which these investments impact the Company’s business and performance and enable it to manage any growth it may experience in future periods; the Company’s level of success in obtaining coverage and adequate reimbursement and collectability levels from third-party payors for its tests; the Company’s level of success in establishing and obtaining the intended benefits from partnerships, joint ventures or other relationships; the Company’s compliance with the various evolving and complex laws and regulations applicable to its business and its industry; risks associated with the Company’s international operations; the Company’s ability to protect its proprietary technology platform; and general industry, economic, political and market conditions. As a result of these risks and uncertainties, forward-looking statements should not be relied on or viewed as predictions of future events.

The forward-looking statements made in this press release speak only as of the date of this press release, and the Company assumes no obligation to update publicly any such forward-looking statements to reflect actual results or to changes in expectations, except as otherwise required by law.

The Company’s reports filed with the U.S. Securities and Exchange Commission (“SEC”), including its annual report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 8, 2021 and the other reports it files from time to time, including subsequently filed quarterly and current reports, are made available on the Company’s website upon their filing with the SEC. These reports contain more information about the Company, its business and the risks affecting its business.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005729/en/

Fulgent Genetics Investors

The Blueshirt Group

Nicole Borsje, 415-217-2633

[email protected]

Helio Health Media

Westwicke/ICR

Terri Clevenger, 203-856-4326

[email protected]

Helio Health Investors

Westwicke/ICR

Mike Cavanaugh, 646-877-9641

[email protected]

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Biotechnology Genetics Health Oncology

MEDIA:

Posted on August 9, 2021 6:49 pm
Omeros Corporation Reports Second Quarter 2021 Financial Results

Omeros Corporation Reports Second Quarter 2021 Financial Results

– Conference Call Today at 4:30 p.m. ET –

SEATTLE–(BUSINESS WIRE)–
Omeros Corporation (Nasdaq: OMER), a commercial-stage biopharmaceutical company committed to discovering, developing and commercializing small-molecule and protein therapeutics for large-market as well as orphan indications targeting inflammation, immunologic diseases (e.g., complement-mediated diseases and cancers) and central nervous system disorders, today announced recent highlights and developments as well as financial results for the second quarter ended June 30, 2021, which include:

OMIDRIA revenues for the second quarter of 2021 were $28.8 million compared to $21.1 million in the first quarter. The 37 percent increase over the prior quarter primarily reflects growth in sales of OMIDRIA^® (phenylephrine and ketorolac intraocular solution) 1%/0.3% in ambulatory surgery centers (ASCs).

Net loss in the second quarter of 2021 was $28.6 million, or $0.46 per share, including non-cash expenses of $3.9 million, or $0.06 per share. This compares to a net loss of $35.1 million, or $0.57 per share, which included non-cash expenses of $4.1 million, or $0.07 per share, for the previous quarter.

At June 30, 2021, Omeros had cash, cash equivalents and short-term investments available for operations of $73.7 million.

Omeros’ Biologics License Application (BLA) for narsoplimab in the treatment of hematopoietic stem cell transplant-associated thrombotic microangipathy (HSCT-TMA or TA-TMA) is under priority review by the U.S. FDA with an action date of October 17, 2021 under the Prescription Drug User Fee Act (PDUFA).

Omeros announced preliminary results from the Phase 1 clinical trial of OMS906, the company’s MASP-3 inhibitor, which showed that (i) OMS906 was well tolerated at all doses tested and (ii) human pharmacokinetic and pharmacodynamic data are consistent with once-monthly or less frequent subcutaneous dosing.

“In the second quarter of 2021, Omeros achieved a number of important milestones,” said Gregory A. Demopulos, M.D., Omeros’ chairman and chief executive officer. “As OMIDRIA sales continue to grow, CMS in its recent OPPS Proposed Rule reaffirmed its determination that OMIDRIA receive separate payment when used in ASCs, and our MASP-3 inhibitor OMS906 is successfully advancing through its Phase 1 clinical trial. Several other important milestones should reach resolution in the near term – FDA’s decision on our pending BLA for narsoplimab in the treatment of patients with TA-TMA, results from narsoplimab in the COVID-19 I-SPY platform clinical trial, and the outcome of the NOPAIN Act, which, if enacted by Congress, would mandate Medicare separate payment for non-opioid surgical pain management drugs like OMDRIA not only in ASCs but also in hospital outpatient departments. The remainder of our pipeline also pressed ahead, including the GPR174 program, the core of our immuno-oncology platform – a platform that has expanded beyond GPR174 with new CAR-T and adoptive cellular therapy programs. Omeros’ momentum is building, and we look forward to seeing what the rest of the year brings.”

Second Quarter and Recent Developments

Recent developments regarding OMIDRIA include the following:

In July 2021, the Centers for Medicare and Medicaid Services (CMS) released its Outpatient Prospective Payment System (OPPS) and ASC Payment System proposed rule for calendar year 2022, which reaffirmed its earlier decision that OMIDRIA, when used in the ASC setting, qualifies for separate payment under CMS’ policy regarding non-opioid pain management surgical drugs. This policy has been in effect since 2019.

Recent developments regarding narsoplimab, Omeros’ lead human monoclonal antibody targeting mannan-binding lectin-associated serine protease-2 (MASP-2) in advanced clinical programs for the treatment of TA-TMA, immunoglobulin A (IgA) nephropathy, atypical hemolytic uremic syndrome (aHUS) and severely ill COVID-19 patients, include the following:

Omeros announced data from the second cohort of 10 critically ill COVID-19 patients treated with narsoplimab under compassionate use in Bergamo, Italy.

All of the patients had comorbidities and/or risk factors for poor outcomes, were mechanically ventilated, and had failed other therapies, including steroids.

90 percent of the patients were intubated prior to initiation of narsoplimab treatment.

80 percent of the patients recovered, survived and were discharged. The two deaths involved a 76-year-old who died of complications related to his pre-existing cardiomyopathy and a 68-year-old who began narsoplimab treatment after 13 days of intubation.

A manuscript from the Omeros-Cambridge Center for Complement and Inflammation Research (OC3IR) on the inhibition of the lectin pathway and MASP-2 as a potential treatment for severe COVID-19 was published in the peer-reviewed journal Frontiers in Immunology.

An abstract on the pharmacokinetic and pharmacodynamic modeling of lectin pathway inhibition by narsoplimab was accepted for presentation at the 16^th International Symposium on IgA nephropathy.

Updates regarding Omeros’ other development programs and platforms include the following:

Omeros announced preliminary results from the Phase 1 clinical trial evaluating the pharmacokinetics/pharmacodynamics (PK/PD) and safety of OMS906 in healthy subjects. OMS906 inhibits MASP-3, the key activator of the alternative pathway of complement. MASP-3 is responsible for the conversion of pro-factor D to mature factor D. Data from the first five cohorts of the trial’s single-ascending dose stage show that (i) OMS906 was well tolerated at all doses tested (up to 5 mg/kg) and (ii) a single 3 mg/kg intravenous dose of OMS906 and a single dose of the lowest subcutaneous concentration tested each suppressed mature complement factor D below minimum detectable levels. The human PK/PD data were consistent with once-monthly or less frequent subcutaneous dosing. Following completion of the single- and multiple-ascending dose stages of the Phase 1 trial, Omeros plans to initiate a Phase 2 clinical trial.

A paper detailing the mechanism of action of PDE7 inhibition in nicotine addiction was published in the peer-reviewed Journal of Neuroscience and was selected for inclusion in the journal’s Featured Research page. Omeros has completed a successful Phase 1 trial with the lead compound in its PDE7 inhibitor program.

Financial Results

For the second quarter of 2021, OMIDRIA revenues were $28.8 million compared to $21.1 million for the first quarter.

Total costs and expenses for the second quarter of 2021 were $52.8 million compared to $51.7 million for the first quarter. The increase was primarily due to increased selling, general and administrative expenses in preparation for the anticipated U.S. launch of narsoplimab and additional employee-related costs. Research and development costs decreased quarter over quarter due to the timing of narsoplimab manufacturing-related costs, which are expensed rather than included as inventory until the initial marketing approval for narsoplimab is certain.

For the three months ended June 30, 2021, Omeros reported a net loss of $28.6 million, or $0.46 per share, which included non-cash expenses of $3.9 million, or $0.06 per share. This compares to a net loss in the previous quarter of $35.1 million, or $0.57 per share, which included non-cash expenses of $4.1 million, or $0.07 per share.

As of June 30, 2021, the company had $73.7 million of cash, cash equivalents and short-term investments. The company also has a line of credit, which permits borrowing up to the lesser of $50.0 million and 85 percent of eligible accounts receivable less certain reserves. Omeros also has an “at the market” program in place that allows the company to sell, from time to time, up to $150.0 million of its common stock.

Conference Call Details

Omeros’ management will host a conference call to discuss the financial results and to provide an update on business activities. The call will be held today at 1:30 p.m. Pacific Time; 4:30 p.m. Eastern Time. To access the live conference call via phone, please dial (844) 831-4029 from the United States and Canada or (920) 663-6278 internationally. The participant passcode is 4195376. A telephone replay will be available for one week following the call and may be accessed by dialing (855) 859-2056 from the United States and Canada or (404) 537-3406 internationally. The replay passcode is 4195376.

To access the live or subsequently archived webcast of the conference call on the internet, go to the company’s website at https://investor.omeros.com/upcoming-events.

About Omeros Corporation

Omeros is a commercial-stage biopharmaceutical company committed to discovering, developing and commercializing small-molecule and protein therapeutics for large-market and orphan indications targeting inflammation, immunologic diseases (e.g., complement-mediated diseases and cancers) and central nervous system disorders. Its commercial product OMIDRIA^® (phenylephrine and ketorolac intraocular solution) 1%/0.3% continues to gain market share in cataract surgery. Omeros’ lead MASP-2 inhibitor narsoplimab targets the lectin pathway of complement and is the subject of a biologics license application under priority review by FDA for the treatment of hematopoietic stem cell transplant-associated thrombotic microangiopathy. Narsoplimab is also in multiple late-stage clinical development programs focused on other complement-mediated disorders, including IgA nephropathy, atypical hemolytic uremic syndrome and COVID-19. OMS906, Omeros’ inhibitor of MASP-3, the key activator of the alternative pathway of complement, is in a Phase 1 clinical trial, and the company’s PDE7 inhibitor program OMS527, targeting addiction and movement disorders, has successfully completed a Phase 1 trial. Omeros’ pipeline holds a diverse group of preclinical programs including a proprietary-asset-enabled antibody-generating technology and a proprietary GPCR platform through which it controls 54 GPCR drug targets and their corresponding compounds. One of these novel targets, GPR174, modulates a new cancer immunity axis recently discovered by Omeros, and the company is advancing GPR174-targeting antibodies and small-molecule inhibitors. For more information about Omeros and its programs, visit www.omeros.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which are subject to the “safe harbor” created by those sections for such statements. All statements other than statements of historical fact are forward-looking statements, which are often indicated by terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “goal,” “intend,” “likely,” “look forward to,” “may,” “objective,” “plan,” “potential,” “predict,” “project,” “should,” “slate,” “target,” “will,” “would” and similar expressions and variations thereof. Forward-looking statements are based on management’s beliefs and assumptions and on information available to management only as of the date of this press release. Omeros’ actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including, without limitation, risks associated with product commercialization and commercial operations, unproven preclinical and clinical development activities, the impact of COVID-19 on our business, financial condition and results of operations, regulatory processes and oversight, challenges associated with manufacture or supply of our investigational or commercial products, changes in reimbursement and payment policies by government and commercial payers or the application of such policies, intellectual property claims, competitive developments, litigation, and the risks, uncertainties and other factors described under the heading “Risk Factors” in the company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on March 1, 2021. Given these risks, uncertainties and other factors, you should not place undue reliance on these forward-looking statements, and the company assumes no obligation to update these forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

OMEROS CORPORATION

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

Three Months Ended

June 30,

Six Months Ended

June 30,

2021

2020

2021

2020

Revenue:

Product sales, net

$

28,823

$

13,530

$

49,885

$

37,067

Costs and expenses:

Cost of product sales

342

147

606

414

Research and development

30,937

24,132

64,309

53,043

Selling, general and administrative

21,560

16,931

39,598

34,967

Total costs and expenses

52,839

41,210

104,513

88,424

Loss from operations

(24,016

)

(27,680

)

(54,628

)

(51,357

)

Interest expense

(4,910

)

(5,978

)

(9,808

)

(11,880

)

Other income

333

364

753

912

Net loss

$

(28,593

)

$

(33,294

)

$

(63,683

)

$

(62,325

)

Comprehensive loss

$

(28,593

)

$

(33,294

)

$

(63,683

)

$

(62,325

)

Basic and diluted net loss per share

$

(0.46

)

$

(0.61

)

$

(1.02

)

$

(1.14

)

Weighted-average shares used to compute basic and diluted net loss per share

62,373,521

54,513,337

62,154,714

54,406,575

OMEROS CORPORATION

UNAUDITED CONSOLIDATED BALANCE SHEET DATA

(In thousands)

June 30,

December 31,

2021

2020

Cash, cash equivalents and short-term investments

$

73,658

$

134,953

Working capital

64,704

114,549

Restricted investments

1,054

1,055

Total assets

145,391

181,042

Total current liabilities

47,697

36,736

Lease liabilities

36,279

32,552

Unsecured convertible senior notes, net

312,585

236,288

Accumulated deficit

(941,052

)

(872,672

)

Total shareholders’ deficit

(246,296

)

(120,752

)

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005719/en/

Jennifer Cook Williams

Cook Williams Communications, Inc.

Investor and Media Relations

[email protected]

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Research Infectious Diseases Clinical Trials Biotechnology Health Pharmaceutical Optical Science Oncology

MEDIA:

Logo

Posted on August 9, 2021 6:49 pm
Fulgent Genetics Announces Acquisition of CSI Laboratories

Fulgent Genetics Announces Acquisition of CSI Laboratories

TEMPLE CITY, Calif.–(BUSINESS WIRE)–
Fulgent Genetics, Inc. (NASDAQ: FLGT) (“Fulgent” or the “Company”), a technology-based genetic testing company focused on transforming patient care in oncology, infectious and rare diseases, and reproductive health, today announced that it has acquired CSI Laboratories (“CSI”) to expand its presence in somatic molecular diagnostics and cancer testing.

CSI was founded in 1997 to provide a client- and patient-focused model of cancer diagnostic testing for pathologists, community hospitals, and their patients. CSI offers more than 400 unique tests with a focus on oncology and capabilities across flow cytometry, cytogenetic analysis, fluorescence in-situ hybridization (“FISH”), immunohistochemistry, and molecular genetics. CSI’s philosophy of providing expert diagnostic testing with speed, precision, and care, is highly complementary with Fulgent’s core value proposition of offering a broad menu of actionable diagnostic tests with quality results and rapid turnaround time.

Strategic Rationale:

– Expansion into somatic genetic testing market, which is expected to grow to $16.8 billion by 2030

– Realize synergies by leveraging Fulgent’s best-in-class technology and Next Generation Sequencing (“NGS”) expertise in new oncology markets

– Geographic expansion of CSI’s reach beyond the Southeastern part of the United States

With the acquisition of CSI, Fulgent will significantly expand its capabilities in molecular diagnostics and oncologic testing. Fulgent will leverage its established technology platform, NGS expertise, lab operations, and sales infrastructure in conjunction with CSI’s extensive cancer testing menu to establish a differentiated foothold in oncologic testing in the United States. The combination of CSI’s extensive molecular diagnostics test menu and Fulgent’s NGS expertise, given its proprietary technology platform, will create a novel, comprehensive cancer testing solution for customers across the United States.

Fulgent’s Chief Medical Officer, Dr. Larry Weiss, will oversee the integration of CSI’s capabilities into Fulgent’s platform and the future operations of the company’s oncologic testing efforts. Fulgent expects to bolster the scale of CSI’s offerings with a new state-of-the-art cancer testing laboratory in California, which it believes will complement CSI’s existing operations in Alpharetta, Georgia.

“We are extremely excited to add CSI Laboratories’ expertise and team to the Fulgent family,” said Ming Hsieh, Chairman and CEO of Fulgent. “Their high standards for test quality and customer service fit extremely well with our values and culture at Fulgent. We look forward to adding their extensive oncologic and molecular diagnostic testing capabilities to our platform.”

“CSI has an outstanding reputation for providing excellent pathology and oncology services in the southeastern United States. We expect CSI will serve as an anchor to Fulgent’s cancer testing capabilities, bringing their expertise and experience to a national oncologic centered client base, and expanding their broad pathology and molecular offerings by leveraging Fulgent’s leadership in Next Generation Sequencing,” said Dr. Larry Weiss, Chief Medical Officer at Fulgent. “Our vision is to combine Fulgent’s excellence in NGS with the broad, high-quality oncologic testing menu already existing in CSI and bring it to a national client base. We expect the addition of CSI will deliver customers a superior experience relative to competitors who offer one-dimensional NGS testing or broader menus without NGS expertise.”

“This is an exciting day for CSI Laboratories’ team members, clients and patients, and we are excited to join forces with a company that shares our same level of commitment to the cancer community, ” said Ron Ghafary, founder of CSI Laboratories. “We look forward to expanding our cancer testing capabilities on Fulgent’s genomic testing platform and continuing to differentiate ourselves through our expertise, high-quality results and high-touch service model that our clinicians and staff deliver on a daily basis.”

Advisors

Piper Sandler acted as the exclusive financial advisor and Mintz Levin, Cohn, Ferris, Glovsky and Popeo served as legal counsel to Fulgent Genetics, Inc. in connection with the transaction.

About Fulgent Genetics

Fulgent Genetics is a technology-based genetic testing company focused on transforming patient care in oncology, infectious and rare diseases, and reproductive health. Fulgent’s proprietary technology platform has created a broad, flexible test menu and the ability to continually expand and improve its proprietary genetic reference library while maintaining accessible pricing, high accuracy, and competitive turnaround times. Combining next generation sequencing (“NGS”) with its technology platform, the Company performs full-gene sequencing with deletion/duplication analysis in an array of panels that can be tailored to meet specific customer needs. A cornerstone of the Company’s business is its ability to provide expansive options and flexibility for all clients’ unique testing needs through a comprehensive technology offering including cloud computing, pipeline services, record management, web portal services, clinical workflow, sequencing as a service and automated lab services.

About CSI Laboratories

CSI was founded in 1997 to provide a more client- and patient-focused model of cancer diagnostic testing for pathologists, community hospitals, and their patients. CSI offers flow cytometry, cytogenetic analysis, fluorescence in-situ hybridization (FISH), immunohistochemistry, molecular genetics, next generation sequencing, and consultations to hematopathology and surgical pathology clients. It is operated by medical professionals, providing expert diagnostic testing and rapid turnaround times for clients across the United States. CSI is a CLIA-certified and CAP-accredited cancer reference laboratory located in Alpharetta, GA.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements in this press release include statements about, among other things: management’s and others’ beliefs, judgments and estimates regarding CSI’s business, prospects, technology platform, products and services, including their value to Fulgent, their potential benefit to Fulgent’s business, platform, services, products and product candidates; Fulgent’s testing solutions and services, including its laboratory capacity and related matters; the Company’s identification and evaluation of opportunities, estimates of market size and its ability to capitalize on opportunities to grow its business.

Forward-looking statements are statements other than historical facts and relate to future events or circumstances or the Company’s future performance, and they are based on management’s current assumptions, expectations and beliefs concerning future developments and their potential effect on the Company’s business. These forward-looking statements are subject to a number of risks and uncertainties, which may cause the forward-looking events and circumstances described in this press release to not occur, and actual results to differ materially and adversely from those described in or implied by the forward-looking statements. These risks and uncertainties include, among others: CSI may not produce the anticipated benefits discussed in this release; the integration of CSI may consume more management and other resources than anticipated; the somatic molecular diagnostics and oncology markets may not grow at the rates anticipated; the ongoing impacts of the COVID-19 pandemic, including the preventive public health measures that may continue to impact demand for its genetics tests and the pandemic’s effects on the global supply chain; the market potential for, and the rate and degree of market adoption of, the Company’s tests, including its newly-developed tests for COVID-19 and genetic testing generally; the Company’s ability to capture a sizable share of the developing market for genetic and COVID-19 testing and to compete successfully in these markets, including its ability to continue to develop new tests that are attractive to its various customer markets, its ability to maintain turnaround times and otherwise keep pace with rapidly changing technology; the Company’s ability to successfully integrate acquired businesses and assets into its business strategy and to derive value from its investments; the Company’s ability to maintain the low internal costs of its business model, particularly as the Company makes investments across its business; the Company’s ability to maintain an acceptable margin on sales of its tests, particularly in light of increasing competitive pressures and other factors that may continue to reduce the Company’s sale prices for and margins on its tests; risks related to volatility in the Company’s results, which can fluctuate significantly from period to period; risks associated with the composition of the Company’s customer base, which can fluctuate from period to period and can be comprised of a small number of customers that account for a significant portion of the Company’s revenue; the Company’s ability to grow and diversify its customer base and increase demand from existing and new customers; the Company’s investments in its infrastructure, including its sales organization and operational capabilities, and the extent to which these investments impact the Company’s business and performance and enable it to manage any growth it may experience in future periods; the Company’s level of success in obtaining coverage and adequate reimbursement and collectability levels from third-party payors for its tests; the Company’s level of success in establishing and obtaining the intended benefits from CSI, partnerships, joint ventures or other relationships; the Company’s compliance with the various evolving and complex laws and regulations applicable to its business and its industry; risks associated with the Company’s international operations; the Company’s ability to protect its proprietary technology platform; and general industry, economic, political and market conditions. As a result of these risks and uncertainties, forward-looking statements should not be relied on or viewed as predictions of future events.

The forward-looking statements made in this press release speak only as of the date of this press release, and the Company assumes no obligation to update publicly any such forward-looking statements to reflect actual results or to changes in expectations, except as otherwise required by law.

The Company’s reports filed with the U.S. Securities and Exchange Commission (“SEC”), including its annual report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 8, 2021 and the other reports it files from time to time, including subsequently filed quarterly and current reports, are made available on the Company’s website upon their filing with the SEC. These reports contain more information about the Company, its business and the risks affecting its business.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005730/en/

Investor Relations Contacts:

The Blueshirt Group

Nicole Borsje, 415-217-2633; [email protected]

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Health Genetics Other Science General Health Research Science

MEDIA:

Posted on August 9, 2021 6:49 pm
Rocket Pharmaceuticals Reports Second Quarter 2021 Financial Results and Highlights Recent Progress

Rocket Pharmaceuticals Reports Second Quarter 2021 Financial Results and Highlights Recent Progress

— Working with FDA on Changes to Clinical Trial Protocol in Danon Disease Trial; Rocket Anticipates Trial Will Resume in 3Q —

— Increasing and Durable Benefit Observed in Low Dose Cohort (6.7e13 dose) in Danon Disease; Removing Higher Dose Cohort (1.1e14 dose) From Future Dosing Plans; Full Clinical Update Expected in 4Q –

— Positive Results from FA, LAD-I, PKD Trials Presented at 24^th ASGCT Annual Meeting Show Preliminary Evidence of Activity and Favorable Tolerability —

— Clinical Updates in FA, LAD-I, PKD and IMO Also Expected in 4Q —

— Ending Balance Sheet with $426.8 Million in Cash; Cash Runway Expected into 2H’23 —

— Conference Call to Be Held at 4:30 p.m. ET Today —

CRANBURY, N.J.–(BUSINESS WIRE)–Rocket Pharmaceuticals, Inc. (NASDAQ: RCKT), a clinical-stage company advancing an integrated and sustainable pipeline of genetic therapies for rare childhood disorders, today reports financial results for the quarter ending June 30, 2021 and updates on the Company’s key pipeline developments, business operations, and upcoming milestones.

“We are grateful to the FDA for its support and for working with us on our Danon program toward resuming our trial, which we believe will occur in the third quarter,” said Gaurav Shah, M.D., chief executive officer of Rocket Pharma. “Further, we have observed durable clinical benefit in the low dose adult cohort, which we believe is supportive of its potential as a viable Phase 2 dose. As of July 2021, we see improvement in two of three low dose patients in NYHA class. In these two patients, we also observed substantial improvement of a key marker of heart failure, BNP, which decreased from a pretreatment baseline by 75 percent in one patient and 79 percent in the other as well as improvement in cardiac output by 35 percent in one patient and 62 percent in the other as measured by invasive hemodynamics. The third patient has demonstrated stabilization of NYHA class and BNP. Given the positive benefit/risk profile in the low dose, and additionally to mitigate safety concerns observed at the higher dose, in agreement with FDA we will no longer treat Danon patients with the higher dose (1.1e14). With our full focus on the low dose, we look forward to progressing our trial on behalf of Danon patients devastated by this disease.”

Dr. Shah continued, “We also presented positive data across three of our lentiviral-based gene therapy programs at ASGCT in May, which we believe support the growing potential of these programs to treat Fanconi Anemia (FA), LAD-1 and PKD patients. Based on these results, we continue our momentum toward advancing these programs. In the case of our FA program, two recent publications reinforce the natural history, clinical design and methods being utilized in our Phase 1/2 FA trial of RP-L102. We look forward to providing updates on all five of our programs in the fourth quarter of 2021.”

Dr. Shah added, “Finally, and importantly, we are deeply saddened that the first patient dosed in our Phase 1 IMO trial has passed way from pulmonary hemorrhage related to thrombocytopenia following conditioning therapy and also related to underlying osteopetrosis. This event was considered likely not related to RP-L401 gene therapy. Consistent with the trial protocol, enrollment has been temporarily paused pending a comprehensive evaluation in collaboration with the Independent Data Monitoring Committee, which will include a review of the conditioning regimen and other potential safety measures to mitigate the impact of underlying disease on treatment. This outcome underscores the need to find cures for this devastating disease and has furthered our commitment and dedication to patients and our mission to develop curative gene therapies for rare disease.”

Key Pipeline and Operational Updates

Danon Disease:

Progressed toward agreement with FDA on changes to the Phase 1 clinical trial protocol in Danon Disease. Rocket anticipates trial may resume this quarter. The U.S. Food and Drug Administration (FDA) had previously requested Rocket pause patient dosing in the Phase 1 clinical trial of RP-A501 and modify the protocol and other supporting documents with revised guidelines for patient selection and management. No new drug-related safety events were observed in the low- or higher-dose adult cohorts; the previously disclosed SAE of thrombotic microangiopathy, which has since resolved, was reclassified as a SUSAR. All follow-up study activities continue. Longer-term results from the low (6.7e13) and higher dose (1.1e14) adult cohorts will be reported in the fourth quarter. In agreement with FDA, Rocket will no longer continue dosing patients at the higher dose (1.1e14).

Fanconi Anemia (FA):

Presented positive clinical updates from RP-L102 Fanconi Anemia (FA) program at ASGCT. Preliminary results from the Phase 1 and 2 trials presented in a poster at ASGCT are from nine pediatric patients. For RP-L102, Rocket’s ex vivo lentiviral gene therapy candidate for FA, increasing evidence of engraftment was observed in at least six of the nine patients, including two patients with at least 15-months of follow-up and four patients with at least 6-months of follow-up. A highly favorable tolerability profile was also observed with all subjects being treated without conditioning and with no reports of dysplasia. One patient experienced a Grade 2 transient infusion-related reaction. The full data presented are available here.

Published two peer-reviewed studies supporting the natural history and clinical design of FA clinical trial. “Natural gene therapy by reverse mosaicism leads to improved hematology in Fanconi anemia patients” was published in the American Journal of Hematology. Data strengthen the natural history of Fanconi Anemia and indicate that reverse mosaicism is a good prognostic factor in FA and is associated with more favorable long-term clinical outcomes. FA mosaicism in hematopoietic cells is a biologic and clinical proof-of principle for autologous gene therapy in FA patients and results provide a compelling rationale for continued clinical evaluation of autologous gene therapy. Additionally, “Improved Collection of Hematopoietic Stem Cells and Progenitors from Fanconi Anemia Patients for Gene Therapy Purposes” was published in Molecular Therapy: Methods & Clinical Development. Results demonstrate the safety and efficacy of filgrastim and plerixafor for mobilization of hematopoietic stem and progenitor cells (HSPCs) and collection by leukapheresis in FA patients, offering crucial information for the enrollment of FA patients for gene therapy studies.

Infantile Malignant Osteopetrosis (IMO):

First patient dosed in the RP-L401 Infantile Malignant Osteopetrosis (IMO) Phase 1 clinical trial passed away from likely non-RP-L401 gene therapy related pulmonary complications. IMO is a bone marrow-derived disorder associated with severe bone and hematologic manifestations leading to death in the first decade of life, frequently within the first two years of life, without an allogenic hematopoietic stem cell transplant (HSCT).
The first patient in the Phase 1 study, a six-year-old child with severe IMO-related anemia and bone abnormalities, was infused with RP-L401 without immediate complications. During the initial weeks after therapy, the patient died of pulmonary complications, most likely pulmonary hemorrhage related to thrombocytopenia following conditioning therapy and also related to underlying osteopetrosis. Pulmonary hemorrhage is a rare but documented complication of HSCT, and pulmonary complications, including life-threatening and fatal complications, have been observed to occur with high frequency in osteopetrosis patients undergoing allogeneic HSCT procedures.

The patient death is not considered to be RP-L401-related by study investigators and as corroborated by autopsy findings. In accordance with the trial protocol, enrollment has been temporarily paused pending a comprehensive evaluation in collaboration with the Independent Data Monitoring Committee.

Leukocyte Adhesion Deficiency-I (LAD-I):

Presented positive clinical updates from RP-L201 Leukocyte Adhesion Deficiency-I (LAD-I) program at ASGCT. Phase 1/2 data presented in an oral presentation at ASGCT are from four pediatric patients with severe LAD-I. RP-L201, Rocket’s ex-vivo lentiviral gene therapy candidate showed preliminary activity in all four patients, including one patient with 18-months of follow-up and one patient with 9-months of follow-up. CD18 expression substantially exceeded the 4-10% threshold in all four patients, which is associated with survival into adulthood and consistent with the reversal of severe LAD-I phenotype. Most importantly, all four patients were able to leave the hospital in the weeks following RP-L201 therapy. The full data presented are available here.

Pyruvate Kinase Deficiency (PKD):

Presented positive clinical updates from RP-L301 Pyruvate Kinase Deficiency (PKD) program at ASGCT. Updated preliminary Phase 1 data presented in an oral presentation at ASGCT are from two patients with significant anemia and transfusion requirements that showed sustained tolerability. Preliminary activity, measured by peripheral blood VCN levels, was observed in both patients during the initial 9-months and 3-months post-treatment, respectively. Durable normalization of hemoglobin levels were observed, from an average baseline of ~7.4 grams (g)/deciliter (dL) to 13.1 g/dL at 9-months post treatment in the first patient and from a baseline of ~7.0 g/dL to 14.4 g/dL at 6-months post treatment in the second patient. The Phase 1 trial continues to enroll patients with longer-term data expected in the fourth quarter. The full data presented are available here.

Anticipated Milestones

Fanconi Anemia (RP-L102)

Updated “Process B” data (Q4 2021)

LAD-I (RP-L201)

Longer-term Phase 2 data (Q4 2021)

Danon Disease (RP-A501)

Longer-term Phase 1 data (Q4 2021)

PKD (RP-L301)

Longer-term Phase 1 data (Q4 2021)

IMO (RP-L401)

Phase 1 clinical update (Q4 2021)

Upcoming Investor Conference

Citi’s 16^th Annual BioPharma Virtual Conference, Sept. 8-10, 2021

Second Quarter Financial Results

Cash position. Cash, cash equivalents and investments as of June 30, 2021 were $426.8 million.

R&D expenses. Research and development expenses were $24.8 million for the three months ended June 30, 2021, compared to $16.7 million for the three months ended June 30, 2020, due to an increase in compensation and benefits expense resulting from increased R&D headcount, an increase in non-cash stock compensation expense, an increase in manufacturing and development costs, and an increase in clinical trials expense.

G&A expenses. General and administrative expenses were $9.3 million for the three months ended June 30, 2021, compared to $6.8 million for the three months ended June 30, 2020, due to an increase in non-cash stock compensation expense, an increase in compensation and benefits expense due to increased G&A headcount and an increase in office and administrative costs.

Net loss. Net loss was $34.5 million or $0.55 per share (basic and diluted) for the three months ended June 30, 2021, compared to $25.0 million or $0.45 per share (basic and diluted) for the three months ended June 30, 2020.

Shares outstanding. 63,448,069 shares of common stock were outstanding as of June 30, 2021.

Financial Guidance

Rocket expects its balance in cash, cash equivalents and investments of $426.8 million as of June 30, 2021 to fund its operations into the second half of 2023, including the continued buildout and initiation of AAV cGMP manufacturing capabilities at our Cranbury, New Jersey R&D and manufacturing facility and continued development of our five clinical programs.

Conference Call Details

Rocket management will host a conference call today at 4:30 p.m. ET. To access the call and webcast, please visit the events section of the website. The webcast replay will be available on the Rocket website following the completion of the call.

Investors may access the conference call by dialing (866) 939-3921 from locations in the United States or +1 (678) 302-3550 from outside the United States. Please refer to conference ID number 50210581.

About Rocket Pharmaceuticals, Inc.

Rocket Pharmaceuticals, Inc. (NASDAQ: RCKT) (“Rocket”) is advancing an integrated and sustainable pipeline of genetic therapies that correct the root cause of complex and rare childhood disorders. The company’s platform-agnostic approach enables it to design the best therapy for each indication, creating potentially transformative options for patients afflicted with rare genetic diseases. Rocket’s clinical programs using lentiviral vector (LVV)-based gene therapy are for the treatment of Fanconi Anemia (FA), a difficult to treat genetic disease that leads to bone marrow failure and potentially cancer, Leukocyte Adhesion Deficiency-I (LAD-I), a severe pediatric genetic disorder that causes recurrent and life-threatening infections which are frequently fatal, Pyruvate Kinase Deficiency (PKD) a rare, monogenic red blood cell disorder resulting in increased red cell destruction and mild to life-threatening anemia and Infantile Malignant Osteopetrosis (IMO), a bone marrow-derived disorder. Rocket’s first clinical program using adeno-associated virus (AAV)-based gene therapy is for Danon disease, a devastating, pediatric heart failure condition. For more information about Rocket, please visit www.rocketpharma.com.

Rocket Cautionary Statement Regarding Forward-Looking Statements

Various statements in this release concerning Rocket’s future expectations, plans and prospects, including without limitation, Rocket’s expectations regarding its guidance for 2021 in light of COVID-19, the safety, effectiveness and timing of product candidates that Rocket is developing to treat Fanconi Anemia (FA), Leukocyte Adhesion Deficiency-I (LAD-I), Pyruvate Kinase Deficiency (PKD), Infantile Malignant Osteopetrosis (IMO) and Danon Disease, the actions of the FDA regarding the clinical hold on Rocket’s Danon Disease program and the safety, effectiveness and timing of related pre-clinical studies and clinical trials, may constitute forward-looking statements for the purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995 and other federal securities laws and are subject to substantial risks, uncertainties and assumptions. You should not place reliance on these forward-looking statements, which often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “will give,” “estimate,” “seek,” “will,” “may,” “suggest” or similar terms, variations of such terms or the negative of those terms. Although Rocket believes that the expectations reflected in the forward-looking statements are reasonable, Rocket cannot guarantee such outcomes. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including, without limitation, Rocket’s ability to monitor the impact of COVID-19 on its business operations and take steps to ensure the safety of patients, families and employees, the interest from patients and families for participation in each of Rocket’s ongoing trials, our expectations regarding the delays and impact of COVID-19 on clinical sites, patient enrollment, trial timelines and data readouts, our expectations regarding our drug supply for our ongoing and anticipated trials, actions of regulatory agencies, which may affect the initiation, timing and progress of pre-clinical studies and clinical trials of its product candidates, Rocket’s dependence on third parties for development, manufacture, marketing, sales and distribution of product candidates, the outcome of litigation, and unexpected expenditures, as well as those risks more fully discussed in the section entitled “Risk Factors” in Rocket’s Annual Report on Form 10-K for the year ended December 31, 2020, filed March 1, 2021 with the SEC. Accordingly, you should not place undue reliance on these forward-looking statements. All such statements speak only as of the date made, and Rocket undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Selected Financial Information

Operating Results:

(amounts in thousands, except share and per share data)

Three Months Ended June 30, Six Months Ended June 30,

2021

2020

2021

2020

Operating expenses:

Research and development
$

                            24,798

$

                            16,731

$

                            53,340

$

                            33,687

General and administrative

                                  9,250

                                  6,828

                               19,930

                               13,990

Total operating expenses

                               34,048

                               23,559

                               73,270

                               47,677

Loss from operations

                             (34,048

)

                             (23,559

)

                             (73,270

)

                             (47,677

)

Research and development incentives

                                           –

                                           –

                                     500

                                           –

Interest expense

                                   (251

)

                               (1,786

)

                               (1,980

)

                               (3,360

)

Interest and other income net

                                     501

                                     429

                                  1,412

                                  1,395

Amortization of premium on investments – net

                                   (727

)

                                   (124

)

                               (1,366

)

                                     (62

)

Net loss
$

                          (34,525

)

$

                          (25,040

)

$

                          (74,704

)

$

                          (49,704

)

Net loss per share attributable to common shareholders – basic and diluted
$

                              (0.55

)

$

                              (0.45

)

$

                              (1.20

)

$

                              (0.90

)

Weighted-average common shares outstanding – basic and diluted

                       63,061,232

                       55,158,459

                       62,321,926

                       55,020,789

June 30,

December 31,

2021

2020

Cash, cash equivalents and investments

                             426,830

                             482,719

Total assets

                             535,154

                             590,824

Total liabilities

                               45,717

                                87,305

Total stockholders’ equity

                             489,437

                             503,519

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005748/en/

Media

Kevin Giordano

Director, Corporate Communications

[email protected]

Investors

Mayur Kasetty, M.D.

Director, Business Development & Operations

[email protected]

KEYWORDS: United States North America New Jersey

INDUSTRY KEYWORDS: Biotechnology Pharmaceutical Health Clinical Trials

MEDIA:

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Posted on August 9, 2021 6:49 pm
Reata Pharmaceuticals, Inc. Announces Second Quarter 2021 Financial Results and Provides an Update on Clinical Development Programs

Reata Pharmaceuticals, Inc. Announces Second Quarter 2021 Financial Results and Provides an Update on Clinical Development Programs

PRE-NDA MEETING WITH FDA SCHEDULED FOR Q3 2021 ON OMAVELOXOLONE FOR PATIENTS WITH FA AND REATA ANNOUNCES PLAN TO FILE OMAVELOXOLONE NDA DURING Q1 2022

PROVIDES UPDATE FROM MID-CYCLE COMMUNICATION MEETING ON BARDOXOLONE FOR PATIENTS WITH CKD CAUSED BY ALPORT SYNDROME

PROVIDES UPDATE FROM TYPE B MEETING ON BARDOXOLONE FOR PATIENTS WITH ADPKD

ANNOUNCES COMPLETION OF ENROLLMENT IN PHASE 2 MERLIN TRIAL OF BARDOXOLONE IN PATIENTS WITH CKD AT RISK OF RAPID PROGRESSION

REAFFIRMS CASH RUNWAY THROUGH MID-2024

CONFERENCE CALL WITH MANAGEMENT ON AUGUST 9, 2021 AT 4:30 P.M. ET

PLANO, Texas–(BUSINESS WIRE)–Reata Pharmaceuticals, Inc. (Nasdaq: RETA) (“Reata,” the “Company,” “our,” “us,” or “we”), a clinical-stage biopharmaceutical company, today announced financial results for the quarter ended June 30, 2021, and provided an update on the Company’s business operations and clinical development programs.

Recent Company Highlights

Omaveloxolone in Patients with Friedreich’s Ataxia (“FA”)

Based on a communication received from the U.S. Food and Drug Administration (“FDA”) regarding omaveloxolone for the treatment of FA, we withdrew our request for a Type C meeting and requested a pre-NDA meeting with the FDA. The pre-NDA meeting request has been granted, a pre-NDA meeting has been scheduled during the third quarter of this year, and we have submitted briefing materials for the meeting. We recently received a communication from the FDA requesting the estimated date of our New Drug Application (“NDA”) for its planning purposes. We plan to submit the NDA during the first quarter of 2022.

Bardoxolone Methyl (“Bardoxolone”) in Patients with Alport Syndrome

The NDA for bardoxolone for the treatment of patients with chronic kidney disease (“CKD”) caused by Alport syndrome is currently under review by the FDA. The FDA completed a bio-research monitoring inspection of Reata. We did not receive any observations. We also recently completed a mid-cycle communication meeting with the FDA. While we have not yet received formal minutes from the FDA, in the preliminary agenda for, and during, the meeting, the FDA identified four significant clinical and statistical review issues for us to address. The FDA invited us to respond to its identified issues in follow-up submissions to the NDA, and we believe each of the identified issues is addressable with additional data and analyses. The FDA did not designate any safety issues as significant issues, and it stated that, based on its current review, it does not believe a Risk Evaluation and Mitigation Strategies (“REMS”) program is needed. The FDA also advised us that an Advisory Committee meeting is tentatively scheduled for December 8, 2021. The Prescription Drug User Fee Act (“PDUFA”) date, the FDA action date for the application, is scheduled for February 25, 2022.

We reaffirm our plan to submit a Marketing Authorization Application (“MAA”) with the European Medicines Agency (“EMA”) in the fourth quarter of 2021 for marketing approval of bardoxolone for the treatment of CKD caused by Alport syndrome in the European Union.

On July 27, 2021, Kyowa Kirin Co., Ltd. (“KKC”), our strategic collaborator in CKD in Japan, submitted an NDA in Japan to the Ministry of Health, Labour and Welfare (“MHLW”) for bardoxolone for the treatment of patients with CKD caused by Alport syndrome. Based on this submission, we have earned a milestone payment under the KKC license agreement.

Bardoxolone in Patients with Autosomal Dominant Polycystic Kidney Disease (“ADPKD”)

FALCON is an international, multi-center, randomized, double-blind, placebo-controlled, registrational Phase 3 trial studying the safety and efficacy of bardoxolone in patients with ADPKD randomized one-to-one to bardoxolone or placebo. We recently had a Type B meeting with the FDA regarding the ADPKD development program, and we have not yet received minutes from the meeting. Based on the discussion during the meeting, we plan to modify the protocol so that the primary endpoint will be the Year 2 off-treatment analysis. Additionally, we will not unblind the trial until after its completion, we will add an eight-week off-treatment visit to the study, and we will incorporate the FDA’s feedback on data related to patients who discontinued treatment early in the study. We may need to increase the patient enrollment sample size from the current target of 550 patients. More than 370 patients are currently enrolled in the study. We continue to expect to enroll 550 patients in the FALCON study by the end of 2021. However, if we decide to increase the target enrollment, we will provide updated guidance on our enrollment timeline.

Bardoxolone in Patients with CKD at Risk of Rapid Progression

MERLIN is a multi-center, double-blind, placebo-controlled, Phase 2 trial to evaluate the safety and efficacy of bardoxolone in patients with CKD due to multiple etiologies at meaningful risk of progression to end-stage kidney disease. We have completed enrollment in the MERLIN trial and expect to have top-line data in the fourth quarter of 2021. If the results of this study are positive, we may proceed to a larger Phase 3 with similar eligibility criteria.

Recent Presentations

Abstracts highlighting results from our various programs in CKD and FA have been selected for presentation at recent international medical conferences. Posters that have been presented can be found on our website at https://www.reatapharma.com/investors/.

Dr. David Lynch, MD, PhD, Director, Friedreich’s Ataxia Program, Division of Neurology, Children’s Hospital of Philadelphia, Philadelphia, PA, presented the talk Efficacy of Omaveloxolone in Patients with Friedreich’s Ataxia: Baseline-Controlled Study at the National Ataxia Foundation’s Ataxia Investigators Meeting 2021, which was held virtually from May 24 – 27, 2021.

Dr. Bradley A. Warady, MD, Director, Division of Pediatric Nephrology, Children’s Mercy Kansas City, Kansas City, MO presented the talk Safety of Bardoxolone Methyl in Pediatric Patients with Alport Syndrome in CARDINAL Phase 3 Trial at the 58th ERA-EDTA Congress, which was held virtually from June 5 – 8, 2021.

Dr. Arlene Chapman, MD, Professor of Medicine, University of Chicago, Chicago, IL, presented the poster Trial Design for Phase 3 FALCON: Evaluation of the Safety, Tolerability, and Efficacy of Bardoxolone Methyl in Patients with Autosomal Dominant Polycystic Kidney Disease at the PKD CON:NECT Conference, which was held virtually from June 25 – 26, 2021.

Second Quarter Financial Highlights

Cash and Cash Equivalents

At June 30, 2021, we had cash and cash equivalents of $755.7 million. The decrease in cash and cash equivalents during the second quarter of 2021 was $21.9 million, as compared to $40.5 million in the first quarter of 2021. This decrease in cash used is primarily due to a $22.9 million tax refund related to the Coronavirus Aid, Relief and Economic Security Act that was received during the second quarter of 2021. We reaffirm our current cash runway to last through mid-2024.

Collaboration Revenue

Collaboration revenue was $2.2 million in the second quarter of 2021, as compared to $3.1 million for the same period of the year prior.

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 $40.1 million for the second quarter of 2021, as compared to $36.8 million, for the same period of the year prior.

Non-GAAP R&D expenses were $34.8 million for the second quarter of 2021, as compared to $29.3 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 $22.0 million for the second quarter of 2021, as compared to $16.6 million, for the same period of the year prior.

Non-GAAP G&A expenses were $14.0 million for the second quarter of 2021, as compared to $9.3 million for the same period of the year prior.¹

GAAP and Non-GAAP Net Loss

The GAAP net loss for the second quarter of 2021 was $72.7 million, or $2.00 per share, on both a basic and diluted basis, as compared to a GAAP net loss of $67.6 million, or $2.03 per share, on both a basic and diluted basis, for the same period of the year prior.

The non-GAAP net loss for second quarter of 2021 was $48.0 million, or $1.32 per share on both a basic and diluted basis, as compared to a non-GAAP net loss of $40.9 million, or $1.23 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.

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 increases in GAAP and non-GAAP net loss are driven primarily by increased clinical study and manufacturing activities, commercial launch readiness activities, and increased personnel and personnel-related costs to support the growth of our development activities compared to the same period of the year prior.

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, non-cash interest expense from liability related to sale of future royalties, loss on extinguishment of debt, and gain on lease termination; 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, non-cash interest expense from liability related to sale of future royalties, and loss on extinguishment of debt. 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 for stock options and restricted stock units and changes in the Company’s stock price, which impacts 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 loss on extinguishment of debt and gain on lease termination as they are non-recurring transactions that make it difficult to compare its results to peer companies who also provide non-GAAP disclosures. The Company has excluded the impact of stock-based compensation expense, non-cash interest expense from liability related to sale of future royalties, loss on extinguishment of debt, and gain on lease termination 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, non-cash interest expense from liability related to sales of future royalties, loss on extinguishment of debt, and gain on lease termination, 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 August 9, 2021, at 4:30 pm ET. The conference call will be accessible by dialing (866) 270-1533 (toll-free domestic) or (412) 317-0797 (international) using the access code: 10157197. The webcast link is https://event.on24.com/wcc/r/3196578/57A5A4A99C3D3BA0F2D6A7D9D86B06B7.

Second quarter financial results to be discussed during the call will be included in an earnings press release that 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 will be accessible for at least 90 days after the event at https://www.reatapharma.com/investors/.

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 that regulate cellular metabolism, inflammation, and the cellular response to injury. 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. We possess exclusive, worldwide rights to develop, manufacture, and commercialize bardoxolone, omaveloxolone, and our next-generation Nrf2 activators, excluding certain Asian markets for bardoxolone in certain indications, which are licensed to Kyowa Kirin Co., Ltd. Bardoxolone and omaveloxolone 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 the detailed factors discussed under the caption “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2020. 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

Six Months Ended

June 30

June 30

2021

2020

2021

2020

Consolidated Statements of Operations

(unaudited)

(in thousands, except share and per share data)

Collaboration revenue

License and milestone

$

803

$

1,169

$

1,598

$

2,338

Other revenue

1,418

1,904

1,568

2,088

Total collaboration revenue

2,221

3,073

3,166

4,426

Expenses

Research and development

40,066

36,783

74,946

84,436

General and administrative

21,998

16,600

42,703

37,387

Depreciation

287

284

561

562

Total expenses

62,351

53,667

118,210

122,385

Other income (expense), net

(13,223

)

(16,990

)

(25,780

)

(20,804

)

Loss before taxes on income

(73,353

)

(67,584

)

(140,824

)

(138,763

)

Benefit from (provision for) taxes on income

653

3

669

22,243

Net loss

$

(72,700

)

$

(67,581

)

$

(140,155

)

$

(116,520

)

Net loss per share—basic and diluted

$

(2.00

)

$

(2.03

)

$

(3.87

)

$

(3.51

)

Weighted-average number of common shares

used in net loss per share basic and diluted

36,299,735

33,265,778

36,251,948

33,243,931

As of

As of

June 30, 2021

December 31, 2020

(unaudited)

(in thousands)

Condensed Consolidated Balance Sheet Data

Cash and cash equivalents

$

755,707

$

818,150

Income tax receivable

–

22,228

Working capital

646,575

728,136

Total assets

777,612

857,598

Liability related to sale of future royalties, net

337,808

315,454

Payable to collaborators

76,923

73,437

Deferred revenue

3,090

4,688

Accumulated deficit

(1,098,400

)

(958,245

)

Total stockholders’ equity

$

313,829

$

417,431

Reconciliation of GAAP to Non-GAAP Financial Measures

The following tables present reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures (in thousands, except for per share data):

Three Months Ended

Six Months Ended

June 30

June 30

2021

2020

2021

2020

Reconciliation of GAAP to Non-GAAP Research and development:

(unaudited)

GAAP Research and development

$

40,066

$

36,783

$

74,946

$

84,436

Less: Stock-based compensation expense

(5,263

)

(7,527

)

(12,071

)

(19,044

)

Non-GAAP Research and development

$

34,803

$

29,256

$

62,875

$

65,392

Reconciliation of GAAP to Non-GAAP General and administrative:

GAAP General and administrative

$

21,998

$

16,600

$

42,703

$

37,387

Less: Stock-based compensation expense

(7,981

)

(7,269

)

(15,852

)

(15,060

)

Non-GAAP General and administrative

$

14,017

$

9,331

$

26,851

$

22,327

Reconciliation of GAAP to Non-GAAP Operating expenses:

GAAP Operating expense

$

62,351

$

53,667

$

118,210

$

122,385

Less: Stock-based compensation expense

(13,244

)

(14,796

)

(27,923

)

(34,104

)

Non-GAAP Operating expense

$

49,107

$

38,871

$

90,287

$

88,281

Reconciliation of GAAP to Non-GAAP Net loss:

GAAP Net loss

$

(72,700

)

$

(67,581

)

$

(140,155

)

$

(116,520

)

Add: Stock-based compensation expense

13,244

14,796

27,923

34,104

Add: Non-cash interest expense from liability

related to sale of future royalties

11,429

664

22,354

664

Add: Loss on extinguishment of debt

–

11,183

–

11,183

Non-GAAP Net loss

$

(48,027

)

$

(40,938

)

$

(89,878

)

$

(70,569

)

Reconciliation of GAAP to Non-GAAP Net loss per common share-

basic and diluted:

GAAP Net loss per common share-basic and diluted

$

(2.00

)

$

(2.03

)

$

(3.87

)

$

(3.51

)

Add: Stock-based compensation expense

0.36

0.44

0.77

1.03

Add: Non-cash interest expense from liability

related to sale of future royalties

0.32

0.02

0.62

0.02

Add: Loss on extinguishment of debt

–

0.34

–

0.34

Non-GAAP Net loss per common share-basic and diluted

$

(1.32

)

$

(1.23

)

$

(2.48

)

$

(2.12

)

Three Months Ended

Reconciliation of GAAP to Non-GAAP Operating expenses

June 30, 2021

March 31, 2021

December 31, 2020

September 30, 2020

(unaudited)

GAAP Operating expenses

$

62,351

$

55,858

$

57,173

$

55,786

Less: Stock-based compensation expense

(13,244

)

(14,679

)

(11,950

)

(11,580

)

Non – GAAP Operating expenses

$

49,107

$

41,179

$

45,223

$

44,206

Reconciliation of GAAP to Non-GAAP Net loss

GAAP Net loss

$

(72,700

)

$

(67,455

)

$

(65,776

)

$

(65,456

)

Add: Stock-based compensation expense

13,244

14,679

11,950

11,580

Add: Non-cash interest expense from liability

related to sale of future royalties

11,429

10,925

10,807

10,413

Less: Gain on lease termination

–

–

(470

)

(816

)

Non-GAAP Net loss

$

(48,027

)

$

(41,851

)

$

(43,489

)

$

(44,279

)

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005740/en/

Reata Pharmaceuticals, Inc.

(972) 865-2219

https://www.reatapharma.com/

Investor Relations & Media:

Manmeet Soni

Andres Lorente

[email protected]

[email protected]

https://www.reatapharma.com/contact-us/

KEYWORDS: United States North America Texas

INDUSTRY KEYWORDS: Biotechnology General Health Pharmaceutical Health

MEDIA:

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Posted on August 9, 2021 6:49 pm
Ocular Therapeutix™ Reports Second Quarter 2021 Financial Results and Business Update

Ocular Therapeutix™ Reports Second Quarter 2021 Financial Results and Business Update

DEXTENZA® Recorded Net Quarterly Sales of $11.1 Million, Representing Quarterly Sequential Growth of Approximately 65%

Initiated First Clinical Trial in the U.S. to Assess a Single OTX-TKI Implant Containing a 600µg Dose of Axitinib for the Treatment of Wet Age-Related Macular Degeneration

Conference Call to Discuss Second Quarter Results to be Held at 4:30 p.m. ET

BEDFORD, Mass.–(BUSINESS WIRE)–
Ocular Therapeutix, Inc. (NASDAQ:OCUL), a biopharmaceutical company focused on the formulation, development, and commercialization of innovative therapies for diseases and conditions of the eye, today reported financial results for the second quarter of 2021, and provided updates on its ophthalmology pipeline.

“It has been a productive quarter for Ocular as we work to build a leading ophthalmology company,” said Antony Mattessich, President and Chief Executive Officer. “Net product revenue for DEXTENZA® was up nearly 700% against the prior year period and we achieved record quarterly in-market sales of nearly 25,000 billable units, representing a 50% sequential increase over the first quarter. Beyond DEXTENZA, we made significant progress in advancing our pipeline of product candidates, dosing the first patient in our U.S.-based trial of OTX-TKI, and completing a research agreement with Mosaic Biosciences targeting dry-AMD that further builds our product pipeline. In the second half of 2021, we look forward to continued momentum with DEXTENZA, including a PDUFA date in allergic conjunctivitis in October, and further development of our pipeline which includes the expected completion of our Phase 2 clinical trial with OTX-CSI, our cyclosporine-containing intracanalicular insert for the chronic treatment of dry eye disease.”

Recent Business Updates

First Patient Dosed in U.S.-based Clinical Trial Evaluating OTX-TKI (axitinib intravitreal implant) for the Treatment of Wet AMD. The Phase 1 clinical trial in the U.S. is a prospective, randomized, controlled, multi-center trial evaluating a single OTX-TKI implant containing a 600 µg dose of axitinib with an anti-VEGF induction injection, compared with a 2 mg dose of aflibercept administered every 8 weeks in subjects previously treated with anti-VEGF therapy. This is the first clinical trial utilizing the Company’s single dose, 600 µg implant. This trial is designed to assess the safety, tolerability, and biological activity of OTX-TKI for the treatment of wet AMD and is being conducted under an exploratory IND, at five sites with a total of 20 randomized subjects: 15 subjects being treated with a single OTX-TKI implant with an anti-VEGF induction injection, and 5 subjects being treated at eight-week intervals with a dose of aflibercept. OTX-TKI has the potential to be a novel sustained release administration of axitinib, with six months or longer durability, which includes a potential new mechanism of action for the treatment for patients with wet AMD and other retinal diseases.

U.S. Commercial Uptake of DEXTENZA. Net product revenue of DEXTENZA® for the quarter was $11.1 million, a nearly 700% increase over the second quarter 2020, and an approximately 65% sequential increase over the first quarter of 2021. DEXTENZA in-market unit volume to surgery centers was a record of nearly 25,000 billable inserts, an approximately 50% sequential increase over the previous quarter. The Company believes this growth reflects strong end-user demand for DEXTENZA driven by an increase in cataract procedure volumes and market share gains. June 2021 in-market unit sales set a monthly record of 9,779 billable inserts as cataract volumes continued to increase through the second quarter of 2021 after a slowing of procedures earlier in the year as result of regional COVID surges. As previously reported, April and May in-market unit sales were 8,025 billable inserts and 7,186 billable inserts, respectively.

DEXTENZA Pass-Through Payment Status Recommended for Extension Through the End of 2022. CMS, in its CY 2022 Outpatient Prospective Payment System (OPPS) proposed rule on July 19, 2021, recommended that pass-through status of DEXTENZA be extended six months through the end of 2022. The Company expects that, if finalized, this decision would move any negotiation between the Company and CMS on DEXTENZA’s post-pass-through payment status into the next rulemaking cycle, a year from now. The Company continues to believe there are a number of pathways whereby it can continue to provide patient access to DEXTENZA in ASCs and HOPDs beyond the pass-through period and expects to be working actively in advance of the 2023 rulemaking cycle.

New Medicare Physician Fee Schedule Proposed for Insertion of DEXTENZA. The Medicare Physician Fee Schedule proposed rule was also issued in July. The proposed rule indicated that the Company’s CPT procedural code, 0356T for the Insertion of a drug-eluting implant into the lacrimal canaliculus, continues to be on track to convert to a Category 1 code in January of 2022 with a proposed procedure payment of $31.91 in the facility and $37.61 in the physician’s office for unilateral insertion. The Company is pleased with the prospect of the Category 1 code conversion for the procedure since Category 1 CPT codes typically benefit from broader coverage and payment among all types of payers. However, the Company intends to use the formal comment period to actively pursue higher potential payment rates that it believes are well justified.

Presented Clinical Data at the 2021 American Society of Cataract and Refractive Surgery (ASCRS) Meeting. Eight company presentations and five presentations from investigator-initiated trials were presented at the 2021 ASCRS Meeting on July 23-27th. Data was presented on multiple programs advancing in clinic as well as DEXTENZA® (dexamethasone ophthalmic insert) 0.4 mg for intracanalicular use and ReSure® Sealant. The data being presented continue to support the use of DEXTENZA to treat post-operative ocular inflammation and pain and the ability to research the use of our proprietary hydrogel technology to potentially address the unmet needs in the ophthalmic space, specifically in glaucoma, dry eye disease and allergic conjunctivitis. Posters for the Company-sponsored presentations can be accessed on the corporate website.

Regeneron Collaboration to Develop a Sustained-Release Formulation of Aflibercept for the Treatment of Wet AMD and other Serious Retinal Diseases Terminated. Regeneron has terminated its collaboration with the Company. The collaboration with Regeneron was initially formed in 2016, and later amended in 2020 to focus on the research and development of an extended-delivery formulation of aflibercept to be delivered to the suprachoroidal space for the treatment of retinal diseases. Ocular is now free to potentially pursue discovery work in this area on its own or with a partner.

Key Program Updates

OTX-TKI (axitinib intravitreal implant) for the potential treatment of wet AMD and other retinal diseases.

The Company dosed the first subject in the U.S.-based Phase 1 clinical trial evaluating a single OTX-TKI implant containing a 600 µg dose of axitinib compared to aflibercept administered every 8 weeks in subjects previously treated with anti-VEGF therapy.

OTX-TIC (travoprost intracameral implant) for the treatment of patients with primary open-angle glaucoma or ocular hypertension.

Following supportive data from a U.S.-based Phase 1 study, the Company is targeting the initiation of a randomized, double-masked, active-controlled Phase 2 clinical trial in the fourth quarter of 2021 in the United States.

The clinical trial will enroll approximately 105 subjects to evaluate two different formulations of OTX-TIC versus a control arm receiving Durysta™.

OTX-CSI (cyclosporine intracanalicular insert) for the chronic treatment of dry eye disease.

The Company has completed enrollment of a U.S.-based Phase 2, randomized, double-masked, multi-center clinical trial to evaluate the safety, efficacy, durability, and tolerability of two different formulations of OTX-CSI versus hydrogel vehicle insert.

Top-line data from the Phase 2 clinical trial are expected in the fourth quarter of 2021.

OTX-DED (dexamethasone intracanalicular insert) for the short-term treatment of the signs and symptoms of dry eye disease.

The Company is enrolling a U.S.-based, prospective, randomized, double-masked, vehicle-controlled, multi-center Phase 2 clinical trial in approximately 150 subjects with dry eye disease.

Enrollment has been faster than anticipated and data from the Phase 2 clinical trial is now expected in the first quarter of 2022 versus prior guidance of the first half of 2022.

DEXTENZA (dexamethasone ophthalmic insert) 0.4 mg for the treatment of ocular itching associated with allergic conjunctivitis.

The FDA has set a PDUFA target action date of October 18, 2021.

Second Quarter Ended June 30, 2021 Financial Results

Gross product revenue net of discounts, rebates, and returns, which the Company refers to as total net product revenue, was $11.7 million and represented a 631% increase over the same period in 2020. Net product revenue of DEXTENZA® in the second quarter was $11.1 million versus $1.4 million in the comparable quarter 2020, reflecting a nearly seven times increase. Total net product revenue for the second quarter also includes net product revenue of $0.6 million from ReSure® Sealant, compared with $0.2 million from ReSure Sealant in the comparable quarter 2020.

Research and development expenses for the second quarter were $13.9 million versus $8.0 million for the comparable period in 2020 primarily driven by increased headcount as well as increased clinical trial costs associated with the initiation of the US-based Phase 1 trial of OTX-TKI as well as the ongoing Phase 2 clinical trials for OTX-CSI and OTX-DED, the ongoing Phase 1 clinical trial of OTX-TKI in Australia and the Phase 3 pediatric clinical trial of DEXTENZA in accordance with the FDA’s post-approval requirements.

Selling and marketing expenses in the quarter were $8.4 million as compared to $6.2 million for the same quarter in 2020, reflecting increased personnel costs associated with expansion of our field force.

Finally, general and administrative expenses were $8.6 million for the second quarter versus $5.1 million in the comparable quarter of 2020. The increase in expenses stemmed primarily from increased personnel expenses and professional fees.

With respect to the financial results for the second quarter, the Company reported a net loss of $8.5 million, or $(0.11) per share on a basic and $(0.25) per share on a diluted basis. This compares to a net loss of $36.6 million, or $(0.64) per share on a basic and diluted basis for the same period in 2020. The decreased loss was due primarily from a $30.4 million net change in the fair value of the derivative liability associated with our convertible note driven by a decrease in the price of our common stock during the quarter. Non-cash charges for stock-based compensation and depreciation and amortization was $4.9 million in the second quarter versus $2.5 million for the same quarter in 2020.

As of August 4, 2021, the Company had 76.6 million shares outstanding.

As of June 30, 2021, the Company had $191.9 million in cash and cash equivalents versus $209.4 million at March 31, 2021. Based on our current plans and related estimates of anticipated cash inflows from DEXTENZA and ReSure product sales and cash outflows from operating expenses, the Company believes that existing cash and cash equivalents, as of June 30, 2021, will enable the Company to fund planned operating expenses, debt service obligations and capital expenditure requirements through 2023. This cash guidance is subject to a number of assumptions including those related to the severity and duration of the COVID-19 pandemic, the revenues, expenses and reimbursement associated with DEXTENZA, and the pace of research and clinical development programs, among other aspects of the business.

Conference Call & Webcast Information

Members of the Ocular Therapeutix management team will host a live conference call and webcast today at 4:30 pm Eastern Time to review the Company’s financial results and provide a general business update. The live webcast can be accessed by visiting the Investors section of the Company’s website at investors.ocutx.com. Please connect at least 15 minutes prior to the live webcast to ensure adequate time for any software download that may be needed to access the webcast. Alternatively, please call (844) 464-3934 (U.S.) or (765) 507-2620 (International) to listen to the live conference call. The conference ID number for the live call will be 3436758. An archive of the webcast will be available until November 9, 2021 on the Company’s website.

About Ocular Therapeutix, Inc.

Ocular Therapeutix, Inc. is a biopharmaceutical company focused on the formulation, development, and commercialization of innovative therapies for diseases and conditions of the eye using its proprietary bioresorbable hydrogel-based formulation technology. Ocular Therapeutix’s first commercial drug product, DEXTENZA®, is an FDA-approved corticosteroid for the treatment of ocular inflammation and pain following ophthalmic surgery. Ocular Therapeutix has received a target action date under the Prescription Drug User Fee Act, commonly known as PDUFA, of October 18, 2021, for a supplemental new drug application for DEXTENZA to include an additional indication for the treatment of ocular itching associated with allergic conjunctivitis. Ocular Therapeutix’s earlier stage development assets currently in Phase 1 clinical trials include OTX-TKI (axitinib intravitreal implant) for the treatment of wet AMD and other retinal diseases and OTX-TIC (travoprost intracameral implant) for the reduction of intraocular pressure in patients with primary open-angle glaucoma or ocular hypertension. Ocular Therapeutix is currently evaluating OTX-CSI (cyclosporine intracanalicular insert) for the chronic treatment of dry eye disease and OTX-DED (dexamethasone intracanalicular insert) for the short-term treatment of the signs and symptoms of dry eye disease in Phase 2 clinical trials. Ocular Therapeutix’s first product, ReSure® Sealant, is an FDA-approved device to prevent wound leaks in corneal incisions following cataract surgery.

Forward Looking Statements

Any statements in this press release about future expectations, plans, and prospects for the Company, including the commercialization of DEXTENZA®, ReSure® Sealant, or any of the Company’s product candidates; the commercial launch of, and effectiveness of reimbursement codes for, DEXTENZA; the conduct of post-approval studies of and compliance with related labeling requirements for DEXTENZA and ReSure Sealant; the development and regulatory status of the Company’s product candidates, such as the Company’s development of and prospects for approvability of DEXTENZA for additional indications including the PDUFA target action date scheduled for October 18, 2021 for allergic conjunctivitis, OTX-CSI for the chronic treatment of dry eye disease, OTX-DED for the short-term treatment of the signs and symptoms of dry eye disease, OTX-TIC for the treatment of primary open-angle glaucoma or ocular hypertension, and OTX-TKI for the treatment of retinal diseases including wet AMD; the ongoing development of the Company’s extended-delivery hydrogel depot technology; the size of potential markets for our product candidates; the potential utility of any of the Company’s product candidates; the potential benefits and future operations of Company collaborations, including any potential future costs or payments thereunder; projected net product revenue, in-market sales and other financial and operational metrics of DEXTENZA and ReSure Sealant; potential market sizes for indications targeted by the Company’s product candidates, if approved; the expected impact of the COVID-19 pandemic on the Company and its operations; the sufficiency of the Company’s cash resources and other statements containing the words “anticipate,” “believe,” “estimate,” “expect,” “intend”, “goal,” “may”, “might,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors. Such forward-looking statements involve substantial risks and uncertainties that could cause the Company’s preclinical and clinical development programs, future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, the timing and costs involved in commercializing DEXTENZA, ReSure Sealant or any product candidate that receives regulatory approval, including the conduct of post-approval studies, the ability to retain regulatory approval of DEXTENZA, ReSure Sealant or any product candidate that receives regulatory approval, the ability to maintain and the sufficiency of product, procedure and any other reimbursement codes for DEXTENZA, the initiation, timing, conduct and outcomes of clinical trials, availability of data from clinical trials and expectations for regulatory submissions and approvals, the Company’s ability to enter into and perform its obligations under collaborations and the performance of its collaborators under such collaborations, the Company’s scientific approach and general development progress, the availability or commercial potential of the Company’s product candidates, the Company’s ability to generate its projected net product revenue and in-market sales on the timeline expected, if at all, the sufficiency of cash resources, the Company’s existing indebtedness, the ability of the Company’s creditors to accelerate the maturity of such indebtedness upon the occurrence of certain events of default, the severity and duration of the COVID-19 pandemic including its effect on the Company’s and relevant regulatory authorities’ operations, any additional financing needs and other factors discussed in the “Risk Factors” section contained in the Company’s quarterly and annual reports on file with the Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent the Company’s views as of the date of this press release. The Company anticipates that subsequent events and developments will cause the Company’s views to change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so, whether as a result of new information, future events or otherwise, except as required by law. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.

Ocular Therapeutix, Inc.



Condensed Consolidated Statements of Operations and Comprehensive Loss

(In thousands, except share and per share data)

(Unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Revenue:

Product revenue, net

$

11,718

$

1,569

$

19,061

$

4,178

Total revenue, net

11,718

1,569

19,061

4,178

Costs and operating expenses:

Cost of product revenue

1,096

134

1,988

953

Research and development

13,859

8,021

24,786

14,119

Selling and marketing

8,391

6,153

16,477

13,283

General and administrative

8,603

5,145

16,268

10,321

Total costs and operating expenses

31,949

19,453

59,519

38,676

Loss from operations

(20,231

)

(17,884

)

(40,458

)

(34,498

)

Other income (expense):

Interest income

8

17

20

156

Interest expense

(1,655

)

(1,694

)

(3,335

)

(3,327

)

Change in fair value of derivative liability

13,396

(17,007

)

38,412

(20,411

)

Other income (expense), net

1

—

1

—

Total other income (expense), net

11,750

(18,684

)

35,098

(23,582

)

Net loss

$

(8,481

)

$

(36,568

)

$

(5,360

)

$

(58,080

)

Net loss per share, basic

$

(0.11

)

$

(0.64

)

$

(0.07

)

$

(1.06

)

Weighted average common shares outstanding, basic

76,324,367

57,368,292

76,198,384

54,634,572

Net loss per share, diluted

$

(0.25

)

$

(0.64

)

$

(0.51

)

$

(1.06

)

Weighted average common shares outstanding, diluted

82,093,599

57,368,292

81,967,616

54,634,572

Ocular Therapeutix, Inc.



Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

(Unaudited)

June 30,

December 31,

2021

2020

Assets

Current assets:

Cash and cash equivalents

$

191,860

$

228,057

Accounts receivable, net

18,734

12,252

Inventory

1,112

1,201

Prepaid expenses and other current assets

4,817

4,650

Total current assets

216,523

246,160

Property and equipment, net

7,042

8,095

Restricted cash

1,764

1,764

Operating lease assets

5,378

5,844

Total assets

$

230,707

$

261,863

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

$

3,881

$

2,709

Accrued expenses and other current liabilities

16,182

14,307

Operating lease liabilities

1,487

1,358

Notes payable, net of discount, current

—

8,290

Total current liabilities

21,550

26,664

Other liabilities:

Operating lease liabilities, net of current portion

6,770

7,548

Derivative liability

59,901

98,313

Deferred revenue

12,000

12,000

Notes payable, net of discount

24,891

16,936

2026 convertible notes, net

25,348

24,307

Total liabilities

150,460

185,768

Commitments and contingencies

Stockholders’ equity:

Preferred stock, $0.0001 par value; 5,000,000 shares authorized and no shares issued or outstanding at June 30, 2021 and December 31, 2020, respectively

—

—

Common stock, $0.0001 par value; 200,000,000 shares authorized and 76,454,597 and 75,996,732 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively

8

8

Additional paid-in capital

624,850

615,338

Accumulated deficit

(544,611

)

(539,251

)

Total stockholders’ equity

80,247

76,095

Total liabilities and stockholders’ equity

$

230,707

$

261,863

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005723/en/

Investors

Ocular Therapeutix

Donald Notman

Chief Financial Officer

[email protected]

or

Westwicke, an ICR Company

Chris Brinzey, 339-970-2843

Managing Director

[email protected]

Media

Ocular Therapeutix

Scott Corning

Senior Vice President, Commercial

[email protected]

KEYWORDS: United States North America Massachusetts

INDUSTRY KEYWORDS: Biotechnology Health Pharmaceutical Optical Clinical Trials

MEDIA:

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Posted on August 9, 2021 6:49 pm
PCTEL Reports Second Quarter Financial Results

PCTEL Reports Second Quarter Financial Results

BLOOMINGDALE, Ill.–(BUSINESS WIRE)–
PCTEL, Inc. (Nasdaq: PCTI) announced its results for the second quarter ended June 30, 2021.

Highlights

Revenue of $21.7 million in the second quarter, 9.3% higher compared to the second quarter 2020 and $4.0 million higher compared to the first quarter 2021.

Gross profit margin of 45.9% in the second quarter, down 2.1% compared to the gross profit margin in the second quarter 2020. The gross profit percentage decline in the second quarter is primarily due to a higher mix of antennas and Industrial IoT devices.

GAAP net income per diluted share of ($0.01) in the second quarter compared to $0.07 in the second quarter 2020.

Non-GAAP net income and adjusted EBITDA are metrics the Company uses to measure its core earnings. A reconciliation of those non-GAAP measures to our GAAP financial statements is provided later in the press release.

Non-GAAP net income per diluted share of $0.07 in the second quarter compared to Non-GAAP net income per diluted share of $0.11 in the second quarter 2020.

Adjusted EBITDA as a percent of revenue of 10.2% in the second quarter compared to 14.4% in the second quarter 2020.

$33.4 million of cash and investments and $0.1 million of debt at June 30, 2021 compared to $41.0 million and no debt at December 31, 2020.

“Our antenna business was stable and the test and measurement products continue to perform very well as we address 5G deployments and emerging public safety opportunities,” said David Neumann, PCTEL’s CEO. “We’re excited about our recent acquisition of Smarteq Wireless AB, a leading European supplier of antennas for vehicular, energy and Industrial IoT applications (“Smarteq”). Smarteq’s design wins for Industrial IoT, EV charging stations and vehicles complement our recent antenna design wins in utilities, 5G and metering. We expect market conditions and the demand for our antenna, IoT device and scanner products to improve through the year as global economies recover.”

CONFERENCE CALL / WEBCAST

PCTEL’s management team will discuss the Company’s results today at 4:30 p.m. ET.The call can be accessed by dialing (888) 506-0062 (United States/Canada) or (973) 528-0011 (International), PIN number: 592274. The call will also be webcast at https://investor.pctel.com/news-events/webcasts-events.

REPLAY: A replay will be available for two weeks after the call on either the website listed above or by calling (877) 481-4010 (United States/Canada), or (919) 882-2331 (International), PIN number: 42253.

About PCTEL

PCTEL is a leading global provider of wireless technology, including purpose-built Industrial IoT devices, antenna systems, and test and measurement solutions. Trusted by our customers for over 25 years, we solve complex wireless challenges to help organizations stay connected, transform, and grow.

For more information, please visit our website at https://www.pctel.com/.

PCTEL Safe Harbor Statement

This press release and our related comments in our earnings conference call contain “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Specifically, the statements about the Company’s expectations regarding the impact of the COVID-19 pandemic; our future financial performance; growth of our antenna solutions and Industrial IoT and test and measurement businesses; the impact of the acquisition of Smarteq on the Company’s ability to offer additional products, expand in the European market, and generate revenue; the impact of our transition plan for manufacturing inside and outside China; the anticipated demand for certain products including those related to public safety, Industrial IoT, 5G and intelligent transportation; and the anticipated growth of public and private wireless systems are forward-looking statements. These statements are based on management’s current expectations and actual results may differ materially from those projected as a result of certain risks and uncertainties, including the disruptions to the Company’s workforce, operations, supply chain and customer demand caused by the COVID-19 pandemic and impact of the pandemic on the Company’s results of operations, financial condition and stock price; the impact of data densification and IoT on capacity and coverage demand; the impact of 5G; customer demand and growth generally in the Company’s defined market segments; the Company’s ability to integrate Smarteq, expand its European presence and benefit from additional antenna and Industrial IoT product offerings; the impact of the uncertainty regarding renewal of our lease of our Tianjin, China manufacturing premises; the impact of tariffs on certain imports from China; and the Company’s ability to grow its business and create, protect and implement new technologies and solutions. These and other risks and uncertainties are detailed in PCTEL’s Securities and Exchange Commission filings. These forward-looking statements are made only as of the date hereof, and PCTEL disclaims any obligation to update or revise the information contained in any forward-looking statement, whether as a result of new information, future events or otherwise.

PCTEL is a registered trademark of PCTEL, Inc. © 2021 PCTEL, Inc. All rights reserved.

PCTEL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(in thousands, except share data)

June 30, December 31,

2021

2020

ASSETS

Cash and cash equivalents
$

8,425

$

5,761

Short-term investment securities

25,002

30,582

Accounts receivable, net of allowances of $80 and $113 at June 30, 2021 and December 31, 2020, respectively

16,786

16,601

Inventories, net

12,391

9,984

Prepaid expenses and other assets

1,583

1,685

Total current assets

64,187

64,613

Property and equipment, net

12,390

12,505

Long-term investment securities

0

4,640

Goodwill

6,522

3,332

Intangible assets, net

1,873

0

Other noncurrent assets

2,573

2,441

TOTAL ASSETS
$

87,545

$

87,531

LIABILITIES AND STOCKHOLDERS’ EQUITY

Accounts payable
$

4,723

$

4,430

Accrued liabilities

9,454

7,316

Total current liabilities

14,177

11,746

Long-term liabilities

4,345

4,387

Total liabilities

18,522

16,133

Stockholders’ equity:

Common stock, $0.001 par value, 50,000,000 shares authorized at June 30, 2021 and December 31, 2020, respectively, and 18,518,515 and 18,429,350 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively

19

18

Additional paid-in capital

126,791

128,250

Accumulated deficit

(57,719

)

(56,888

)

Accumulated other comprehensive income

(68

)

18

Total stockholders’ equity

69,023

71,398

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$

87,545

$

87,531

PCTEL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(in thousands, except per share data)

Three Months Ended Six Months Ended

June 30, June 30,

2021

2020

2021

2020

REVENUES
$

21,681

$

19,842

$

39,388

$

37,348

COST OF REVENUES

11,739

10,321

21,108

19,612

GROSS PROFIT

9,942

9,521

18,280

17,736

OPERATING EXPENSES:

Research and development

3,221

3,070

6,416

6,099

Sales and marketing

3,388

2,397

6,151

5,539

General and administrative

3,335

2,945

6,411

5,747

Amortization of intangible assets

55

0

55

33

Restructuring expenses

60

11

60

98

Total operating expenses

10,059

8,423

19,093

17,516

OPERATING (LOSS) INCOME

(117

)

1,098

(813

)

220

Other (expense) income, net

(45

)

102

(6

)

300

(LOSS) INCOME BEFORE INCOME TAXES

(162

)

1,200

(819

)

520

Expense for income taxes

7

8

12

16

NET (LOSS) INCOME
$

(169

)

$

1,192

$

(831

)

$

504

Net (Loss) Income per Share:

Basic
$

(0.01

)

$

0.07

$

(0.05

)

$

0.03

Diluted
$

(0.01

)

$

0.07

$

(0.05

)

$

0.03

Weighted Average Shares:

Basic

18,241

18,159

18,158

18,180

Diluted

18,241

18,214

18,158

18,352

Cash dividend per share
$

0.055

$

0.055

$

0.110

$

0.110

PCTEL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

Six Months Ended June 30,

.
2021

2020

Operating Activities:

Net (loss) income
$

(831

)

$

504

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Depreciation and amortization

1,493

1,502

Intangible asset amortization

70

144

Stock-based compensation

1,657

1,563

Loss on disposal of property and equipment

3

7

Restructuring costs

45

(28

)

Bad debt provision

(34

)

(110

)

Changes in operating assets and liabilities:

Accounts receivable

1,260

2,065

Inventories

(1,121

)

882

Prepaid expenses and other assets

532

871

Accounts payable

(630

)

810

Income taxes payable

(18

)

16

Other accrued liabilities

624

(1,167

)

Deferred revenue

63

19

Net cash provided by operating activities

3,113

7,078

Investing Activities:

Capital expenditures

(1,266

)

(2,418

)

Purchase of investments

(16,058

)

(26,323

)

Redemptions/maturities of short-term investments

26,278

25,781

Cash paid for acquisition, net of cash acquired

(6,277

)

0

Net cash provided by (used in) investing activities

2,677

(2,960

)

Financing Activities:

Proceeds from issuance of common stock

418

496

Proceeds from Paycheck Protection Program Loan

0

3,500

Repayment of Paycheck Protection Program Loan

0

(3,500

)

Payment of withholding tax on stock-based compensation

(782

)

(1,106

)

Principle payments on finance leases

(35

)

(41

)

Purchase of common stock from repurchase program

(733

)

(2,000

)

Cash dividends

(2,018

)

(2,054

)

Net cash used in financing activities

(3,150

)

(4,705

)

Net increase (decrease) in cash and cash equivalents

2,640

(587

)

Effect of exchange rate changes on cash

24

(49

)

Cash and cash equivalents, beginning of period

5,761

7,094

Cash and Cash Equivalents, End of Period
$

8,425

$

6,458

PCTEL, INC.

REVENUE AND GROSS PROFIT BY PRODUCT LINE (unaudited)

Reconciliation of GAAP Gross Margin percentage to Non-GAAP Gross Margin Percentage

($’s in thousands)

Three Months Ended June 30, 2021 Six Months Ended June 30, 2021

Antennas and
Industrial IoT
Devices Test &
Measurement
Products Corporate Total Antennas and
Industrial IoT
Devices Test &
Measurement
Products Corporate Total

REVENUES
$15,562

$6,414

($295)

$21,681

$27,285

$12,619

($516)

$39,388

GROSS PROFIT
$5,175

$4,834

($67)

$9,942

$8,922

$9,422

($64)

$18,280

GAAP GROSS PROFIT %
33.3%

75.4%

45.9%

32.7%

74.7%

46.4%

Non-GAAP adjustments:

Amortization of inventory step-up
1.8%

0.0%

1.3%

0.0%

0.0%

0.7%

Amortization of intangible assets
0.1%

0.0%

0.1%

0.0%

0.0%

0.0%

Stock compensation expenses
0.2%

0.5%

0.3%

0.2%

0.5%

0.3%

Non-GAAP GROSS PROFIT %
35.4%

75.9%

47.5%

32.9%

75.2%

47.5%

Three Months Ended June 30, 2020

Six Months Ended June 30, 2020

Antennas and
Industrial IoT
Devices

Test &
Measurement
Products

Corporate

Total

Antennas and
Industrial IoT
Devices

Test &
Measurement
Products

Corporate

Total

REVENUES
$13,910

$6,118

($186)

$19,842

$25,370

$12,201

($223)

$37,348

GROSS PROFIT
$4,973

$4,609

($61)

$9,521

$8,892

$8,905

($61)

$17,736

GROSS PROFIT %
35.8%

75.3%

48.0%

35.0%

73.0%

47.5%

Non-GAAP adjustments:

Amortization of intangible assets
0.0%

0.0%

0.0%

0.0%

0.9%

0.3%

Stock compensation expenses
0.3%

0.6%

0.4%

0.3%

0.6%

0.4%

Non-GAAP GROSS PROFIT %
36.0%

76.0%

48.4%

35.3%

74.5%

48.2%

The Corporate column includes the elimination of intercompany revenues between Antennas and Industrial IoT Devices and Test & Measurement Products and other licensing revenues.

This schedule reconciles the Company’s GAAP gross margin percentage to its Non-GAAP gross margin percentage. The Company believes that this schedule provides meaningful supplemental information to both management and investors that is indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods.

The adjustments on this schedule consist of amortization of intangible assets, stock compensation expenses, and the amortizaion of the inventory step-up to fair value related to the acquisition of Smarteq.

Reconciliation of GAAP to non-GAAP Results (unaudited)

(in thousands except per share information)

Reconciliation of GAAP operating income (loss) to non-GAAP operating loss

Three Months Ended June 30, Six Months Ended June 30,

2021

2020

2021

2020

Operating Income (Loss)
($117

)

$1,098

($813

)

$220

(a) Add:

Amortization of inventory step-up to fair value
283

0

283

0

Amortization of intangible assets:

-Cost of revenues
15

0

15

111

-Operating expenses
55

0

55

33

Restructuring
60

11

60

98

Stock compensation expenses:

-Cost of revenues
65

74

134

146

-Research and development
140

145

282

282

-Sales & marketing
226

164

386

314

-General & administrative
608

618

855

821

Acquisition related expenses
121

0

304

0

1,573

1,012

2,374

1,805

Non-GAAP Operating Income
$1,456

$2,110

$1,561

$2,025

% of revenue
6.7

%

10.6

%

4.0

%

5.4

%

Reconciliation of GAAP net loss to non-GAAP net (loss) income

Three Months Ended June 30, Six Months Ended June 30,

2021

2020

2021

2020

Net Income (Loss)
($169

)

$1,192

($831

)

$504

Adjustments:

(a) Non-GAAP adjustments to operating income (loss)
1,573

1,012

2,374

1,805

(b) Income Taxes
(106

)

(169

)

(112

)

(170

)

1,467

843

2,262

1,635

Non-GAAP Net Income
$1,298

$2,035

$1,431

$2,139

Non-GAAP Income per Share:

Basic
$0.07

$0.11

$0.08

$0.12

Diluted
$0.07

$0.11

$0.08

$0.12

Weighed Average Shares:

Basic
18,241

18,159

18,158

18,180

Diluted
18,241

18,214

18,158

18,352

This schedule reconciles the Company’s GAAP operating income (loss) to its non-GAAP operating income. The Company believes that presentation of this schedule provides meaningful supplemental information to both management and investors that is indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods. The Company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes. These non-GAAP measures should not be viewed as a substitute for the Company’s GAAP results.

The adjustments to GAAP operating Income (Loss) (a) consist of stock compensation expense, amortization of intangible assets, amortization of the step-up to fair value of the inventory for Smarteq, and acquisition related expenses. The adjustments to GAAP Net Income (Loss) include the non-GAAP adjustments to operating income (loss) well as adjustments for (b) non-cash income tax expense.

PCTEL, INC.

Reconciliation of GAAP Operating Expenses to Non-GAAP Operating expenses (unaudited)

(in thousands)

Three Months Ended June 30, Six Months Ended June 30,

2021

2020

2021

2020

GAAP Operating expenses
10,059

8,423

19,093

17,516

Stock compensation expenses
(974

)

(927

)

(1,523

)

(1,417

)

Amortization of intangible assets
(55

)

0

(55

)

(33

)

Restructuring expenses
(60

)

(11

)

(60

)

(98

)

Acquisition related expenses
(121

)

0

(304

)

0

Non-GAAP Operating expenses
8,849

7,485

17,151

15,968

This schedule reconciles the Company’s GAAP operating expenses to its Non-GAAP operating expenses. The Company believes that this schedule provides meaningful supplemental information to both management and investors that is indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods.

The adjustments on this schedule consist of amortization of intangible assets, stock compensation expenses, restructuring expenses, and acquisition related expenses.

PCTEL, Inc.

Reconciliation of GAAP operating (loss) income to Adjusted EBITDA

(unaudited, in thousands)

Three Months Ended June 30,

Six Months Ended June 30,

2021

2020

2021

2020

Operating (Loss) Income
($117

)

$1,098

($813

)

$220

Add:

Amortization of inventory step-up to fair value
283

0

283

0

Depreciation and amortization
751

754

1,493

1,502

Intangible amortization
70

0

70

144

Restructuring expenses
60

11

60

98

Stock compensation expenses
1,039

1,001

1,657

1,563

Acquisition related expenses
121

0

304

0

Adjusted EBITDA
$2,207

$2,864

$3,054

$3,527

% of revenue
10.2

%

14.4

%

7.8

%

9.4

%

This schedule reconciles the Company’s GAAP operating income (loss) to Adjusted EBITDA. The Company believes that this schedule provides meaningful supplemental information to both management and investors that is indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods. The Company uses Adjusted EBITDA when evaluating its financial results as well as for internal planning and forecasting purposes. Adjusted EBITDA should not be viewed as a substitute for the Company’s GAAP results.

Adjusted EBITDA is defined as net income before interest, income taxes, depreciation and amortization and extraordinary expenses. The adjustments on this schedule consist of depreciation, amortization of intangible assets, stock compensation expenses, the amortization of inventory step up to fair value, restructuring and acquisition related expenses.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005712/en/

Kevin McGowan

CFO

PCTEL, Inc.

(630) 339-2051

Suzanne Cafferty

Vice President, Global Marketing

PCTEL, Inc.

(630) 339-2107

[email protected]

KEYWORDS: United States North America Illinois

INDUSTRY KEYWORDS: Internet Data Management Mobile/Wireless Technology Telecommunications

MEDIA:

Logo

Posted on August 9, 2021 6:49 pm
Gossamer Bio Announces Second Quarter 2021 Financial Results and Provides Corporate Update

Gossamer Bio Announces Second Quarter 2021 Financial Results and Provides Corporate Update

– Seralutinib and GB004 continue to enroll ongoing Phase 2 TORREY and SHIFT-UC clinical trials for Pulmonary Arterial Hypertension (PAH) and Ulcerative Colitis (UC), respectively –

– Gossamer Announces Seralutinib Open Label Extension Data in PAH Patients –

– Gossamer to Discontinue Clinical Development of GB1275 –

– Cash, cash equivalents and marketable securities totaled $406 million as of June 30, 2021 –

SAN DIEGO–(BUSINESS WIRE)–
Gossamer Bio, Inc. (Nasdaq: GOSS), a clinical-stage biopharmaceutical company focused on discovering, acquiring, developing and commercializing therapeutics in the disease areas of immunology, inflammation and oncology, today announced its financial results for the second quarter of 2021 and provided a corporate update.

“I am tremendously proud of the dedication and perseverance the Gossamer team has shown this year, pressing forward with the execution of two Phase 2 studies for our lead clinical programs, seralutinib and GB004, in the face of operational challenges presented by the pandemic,” said Faheem Hasnain, Co-Founder, Chairman and Chief Executive Officer of Gossamer. “We are also very happy to share data from the first extended clinical experience of seralutinib, the first such data from an inhaled kinase inhibitor in patients with PAH. Though the pandemic limited the number of patients who were able to continue onto the OLE, these patient experiences provide additional evidence supporting the potential of seralutinib to improve the lives of PAH patients.”

Clinical-Stage Product Candidate Updates

Seralutinib (GB002): Inhaled PDGFR, CSF1R and C-KIT Inhibitor for PAH

While the conduct of the Phase 1b study of seralutinib in patients with Functional Class II and III PAH was interrupted by the COVID-19 pandemic, two of the eight patients that completed the two-week Phase 1b study were also able to complete the optional 6-month open-label extension period.

Both patients entered and completed the extension study on three classes of background therapy, including oral prostacyclins.

No serious adverse events were reported, and no safety concerns identified with longer term treatment over a six-month period at a twice daily 90mg dose.

In both patients, decreases in NT-proBNP, a biomarker for right heart strain, and increases in six-minute walk distance, a potential registrational endpoint for PAH, were observed.

Enrollment is ongoing in the TORREY Study, a Phase 2 clinical trial in patients with PAH whose disease has progressed despite standard-of-care therapy. The primary endpoint is change in pulmonary vascular resistance (PVR) from baseline at week 24. Topline data from the TORREY study are expected in the first half of 2022, subject to developments in the ongoing COVID-19 pandemic.

Additional exploratory biomarker data from the completed seralutinib two-week Phase 1b in eight PAH patients will be presented via ePoster at the Virtual European Respiratory Society (ERS) International Congress 2021 being held virtually from September 5 – 8, 2021. Abstract content will be available online at the ERS website, starting on August 23, 2021, two weeks prior to the beginning of the virtual ERS Congress. ePoster details:

ePoster Title: Evidence of Target Engagement and Pathway Modulation: Biomarker Analysis of the Phase 1b Inhaled Seralutinib Study

Session Date: Sunday, September 5, 2021

Session Time: 1:15pm CEST / 7:15am EDT / 4:15am PDT

GB004: Oral, Gut-Targeted HIF-1α Stabilizer for Inflammatory Bowel Disease (IBD)

Enrollment is ongoing in the SHIFT-UC Study, a Phase 2 clinical trial in patients with active UC despite treatment with 5-ASAs. The primary endpoint is proportion of patients with clinical remission at week 12. Topline data from the SHIFT-UC study are expected in the first half of 2022, subject to developments in the ongoing COVID-19 pandemic.

Additional post-hoc analysis of clinical data from the completed GB004 Phase 1b in patients with active UC will be presented at the United European Gastroenterology (UEG) Virtual Week 2021 being held virtually from October 3 – 5, 2021. Presentation details:

Abstract Title: Assessment of Composite Endpoints Comprising Symptomatic, Histologic, Endoscopic, and Molecular Improvement in a Phase 1b Study of GB004, a Gut-Targeted, Hypoxia-Inducible Factor (HIF)-1α Stabilizer, in Mild-to-Moderate Ulcerative Colitis

Presenting Author: Silvio Danese, MD, PhD

Abstract Number: OP124

Session Title: IBD Clinical Trials III

Session Date: Monday, October 4, 2021

Session Time: 3:00pm CEST / 9:00am EDT / 6:00am PDT

GB1275:Oral CD11b Modulator for Solid Tumor Oncology Indications

Gossamer will discontinue clinical development of its immuno-oncology product candidate, GB1275, which is currently in a Phase 1/2 clinical trial in solid tumor indications as a monotherapy and in combination with either pembrolizumab or chemotherapy.

Financial Results for the Quarter Ended June 30, 2021

Cash, Cash Equivalents and Marketable Securities: Cash, cash equivalents and marketable securities as of June 30, 2021, were $405.9 million. The Company expects the combination of current cash, cash equivalents and marketable securities, and access to its debt facility will be sufficient to fund its operating and capital expenditures into the second half of 2023.

Research and Development (R&D) Expenses: For the quarter ended June 30, 2021, R&D expenses were $44.3 million, compared to R&D expenses of $38.7 million for the same period in 2020.

General and Administrative (G&A) Expenses: For the quarter ended June 30, 2021, G&A expenses were $11.3 million, compared to $11.7 million for the same period in 2020.

Net Loss: Net loss for the quarter ended June 30, 2021, was $59.8 million, or $0.80 per share, compared to a net loss of $66.9 million, or $1.00 per share, for the same period in 2020.

Conference Call and Webcast

Gossamer’s management team will host a conference call and live audio webcast at 4:30 p.m. ET today, Monday, August 9, to discuss its second quarter 2021 financial results, provide a corporate update, and present the seralutinib Phase 1b open-label extension data.

The live audio webcast may be accessed through the “Events / Presentations” page in the “Investors” section of the Company’s website at www.gossamerbio.com. Alternatively, the conference call may be accessed through the following:

Conference ID: 1188932

Domestic Dial-in Number: (833) 646-0603

International Dial-in Number: (929) 517-9782

Live Webcast: https://edge.media-server.com/mmc/p/ruj72hwq

A replay of the audio webcast will be available for 30 days on the “Investors” section of the Company’s website, www.gossamerbio.com.

About Gossamer Bio

Gossamer Bio is a clinical-stage biopharmaceutical company focused on discovering, acquiring, developing and commercializing therapeutics in the disease areas of immunology, inflammation and oncology. Its goal is to be an industry leader in each of these therapeutic areas and to enhance and extend the lives of patients suffering from such diseases.

Forward-Looking Statements

Gossamer cautions you that statements contained in this press release regarding matters that are not historical facts are forward-looking statements. These statements are based on the Company’s current beliefs and expectations. Such forward-looking statements include, but are not limited to, statements regarding: the anticipated timing of enrollment of clinical trials for our product candidates; plans to advance our product candidates; expectations on the timing of data readouts from our clinical studies; the potential clinical benefits of our product candidates; the expected impact of COVID-19; and the expected timeframe for funding our operating plan with current cash, cash equivalents and marketable securities. The inclusion of forward-looking statements should not be regarded as a representation by Gossamer that any of its plans will be achieved. Actual results may differ from those set forth in this press release due to the risks and uncertainties inherent in Gossamer’s business, including, without limitation: potential delays in the commencement, enrollment and completion of clinical trials; disruption to our operations from the ongoing global outbreak of the COVID-19 pandemic, including clinical trial delays; the Company’s dependence on third parties in connection with product manufacturing, research and preclinical and clinical testing; the results of preclinical studies and early clinical trials are not necessarily predictive of future results; the success of Gossamer’s clinical trials and preclinical studies for its product candidates; regulatory developments in the United States and foreign countries; unexpected adverse side effects or inadequate efficacy of our product candidates that may limit their development, regulatory approval and/or commercialization, or may result in recalls or product liability claims; Gossamer’s ability to obtain and maintain intellectual property protection for its product candidates; Gossamer’s ability to comply with its obligations in collaboration agreements with third parties or the agreements under which it licenses intellectual property rights from third parties; Gossamer may use its capital resources sooner than it expects; and other risks described in the Company’s prior press releases and the Company’s filings with the Securities and Exchange Commission (SEC), including under the heading “Risk Factors” in the Company’s annual report on Form 10-K and any subsequent filings with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and Gossamer undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Gossamer Bio Statement of Operations

Condensed Consolidated Statement of Operations

(in thousands, except share and per share amounts)

(unaudited)

Three months ended June 30,

Six months ended June 30,

2021

2020

2021

2020

Operating expenses:

Research and development

$

44,318

$

38,684

$

86,145

$

80,098

In process research and development

15

15,000

45

17,805

General and administrative

11,263

11,655

22,609

22,403

Total operating expenses

55,596

65,339

108,799

120,306

Loss from operations

(55,596

)

(65,339

)

(108,799

)

(120,306

)

Other income (expense), net

Interest income

141

898

334

2,496

Interest expense

(4,834

)

(2,491

)

(9,614

)

(3,198

)

Other income

457

62

606

64

Total other expense, net

(4,236

)

(1,531

)

(8,674

)

(638

)

Net loss

$

(59,832

)

$

(66,870

)

$

(117,473

)

$

(120,944

)

Net loss per share, basic and diluted

$

(0.80

)

$

(1.00

)

$

(1.58

)

$

(1.88

)

Weighted average common shares outstanding, basic and diluted

74,672,882

66,599,915

74,384,805

64,245,119

Condensed Consolidated Balance Sheet

(in thousands)

(unaudited)

BALANCE SHEET DATA:

June 30, 2021

December 31, 2020

Cash, cash equivalents, and marketable securities

$

405,919

$

512,628

Working capital

387,005

483,672

Total assets

432,510

539,433

Total liabilities

211,817

218,749

Accumulated deficit

(695,003

)

(577,530

)

Total stockholders’ equity

220,693

320,684

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005711/en/

For Investors and Media:

Bryan Giraudo, Chief Financial Officer

Gossamer Bio Investor Relations

[email protected]

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Oncology Health Infectious Diseases Clinical Trials Pharmaceutical Biotechnology

MEDIA:

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