Arena Pharmaceuticals Provides Corporate Update and Reports Fourth Quarter and Full-Year 2018 Financial Results
SAN DIEGO, Feb. 26, 2019 /PRNewswire/ -- Arena Pharmaceuticals, Inc. (Nasdaq: ARNA) today provided a corporate update and reported financial results for the fourth quarter and full-year ended December 31, 2018.
"In 2018 we delivered the steps necessary to position Arena for long-term, sustainable growth by securing a strong cash position, generating important data for our potential first- or best-in-class compounds, and scaling the organization. We kicked off 2019 with exciting data demonstrating etrasimod's long-term efficacy and safety in an open-label extension trial, followed by the completion of the global license deal with United Therapeutics," said Amit D. Munshi, President and CEO of Arena. "We are in a great position and we look forward to continuing to build on the momentum of the last two years."
Pipeline Update
Etrasimod - Next generation, oral, selective sphingosine-1-phosphate (S1P) receptor modulator in development for the treatment of multiple immune and inflammatory diseases
-- Ulcerative colitis (UC):
-- Phase 3 planning ongoing
-- Delivered positive open-label extension data of Phase 2 OASIS trial
-- Demonstrated clinical response and durable, long-term clinical
remission and a favorable long-term safety and tolerability
-- Subjects that achieved clinical response or clinical remission
on 2 mg etrasimod at 12 weeks in OASIS demonstrated sustained
treatment effect over 46 weeks, with 93% experiencing sustained
clinical response and 75% experiencing sustained clinical
remission
-- Crohn's disease (CD):
-- Phase 2b/3 planning ongoing
-- Atopic dermatitis (AD):
-- Phase 2 planning ongoing
Olorinab - Oral, peripherally restricted, highly selective, full agonist of cannabinoid receptor type 2 (CB(2)) in development for the treatment of visceral pain associated with gastrointestinal (GI) diseases
-- Advancing into a Phase 2b clinical program targeting the treatment of
irritable bowel syndrome (IBS) pain
APD418 - First-in-class, oral, calcium-independent myofilament derepressor (CMD) for the treatment of decompensated heart failure (DHF)
-- Preclinical program advancing
Collaboration and License Agreements Update
-- In January 2019, Arena and United Therapeutics closed the Global License
Agreement for ralinepag, a potential best-in-class agent for the
treatment of pulmonary arterial hypertension. Arena received $800
million upfront and is eligible to receive up to $400 million in
regulatory milestone payments plus low double-digit tiered royalties.
Corporate Update
-- In December 2018, Arena appointed Manmeet S. Soni as a non-executive
director
-- In November 2018, Arena appointed Robert Lisicki as Executive Vice
President and Chief Commercial Officer, and Paul K. Audhya, MD, MBA, as
Senior Vice President, Medical Affairs
-- Arena announced expansion into the Boston area
Financial Update
Fourth Quarter 2018 Financial Results
-- Revenues totaled $8.6 million, consisting of $6.9 million in
collaboration revenue and $1.8 million in royalty revenue
-- Research and development expenses totaled $37.9 million
-- General and administrative expenses totaled $15.4 million
-- Income tax benefit related to a change in our deferred tax asset
valuation allowance was $110.3 million
-- Net income attributable to stockholders of Arena was $68.7 million, the
basic earnings per share was $1.39 per share and the diluted earnings
per share was $1.35
Full-Year 2018 Financial Results
-- Revenues totaled $18.0 million, consisting of $11.4 million in
collaboration revenue and $6.6 million in royalty revenue
-- Research and development expenses totaled $115.0 million
-- General and administrative expenses totaled $47.7 million
-- Income tax benefit related to a change in our deferred tax asset
valuation allowance was $110.3 million
-- Net loss attributable to stockholders of Arena was $29.4 million, or
$0.63 per share
At December 31, 2018, Arena's cash, cash equivalents and investments balance was $528.0 million and approximately 49.4 million shares of Arena common stock were outstanding. As of February 1, 2019 Arena's cash, cash equivalents and investments balance was over $1.3 billion.
Conference Call & Webcast Information
Arena will host a conference call and live webcast with the investment community today, Tuesday, February 26, 2019, at 4:30 p.m. EST to discuss the financial results and provide a corporate update.
When: Tuesday, February 26, 2019, at 4:30 p.m. EST
Dial-in: (877) 643-7155 (United States) or (914) 495-8552 (International)
Conference ID: 1855406
Please join the conference call at least 10 minutes early to register. You can access the live webcast under the investor relations section of Arena's website at: www.arenapharm.com. A replay of the conference call will be archived under the investor relations section of Arena's website for 30 days shortly after the call.
About Arena Pharmaceuticals
Arena Pharmaceuticals is driven to deliver novel, transformational medicines with optimized pharmacology and pharmacokinetics to patients globally. Arena's proprietary pipeline includes multiple potentially first- or best-in-class assets with broad clinical utility. Etrasimod (APD334), with potential utility in a broad range of immune and inflammatory conditions, is being evaluated in late-stage clinical programs in ulcerative colitis (UC) and Crohn's disease, as well as in programs for other indications such as atopic dermatitis. Arena is also evaluating olorinab (APD371) in a Phase 2 program for gastrointestinal pain. Arena continues to assess other earlier research and development stage drug candidates, including APD418 for decompensated heart failure. Arena's licensee, United Therapeutics, is evaluating ralinepag in a Phase 3 program for pulmonary arterial hypertension (PAH).
Arena has additional license agreements and partnerships, including with Everest Medicines Limited (etrasimod in Greater China and select Asian countries), Boehringer Ingelheim International GmbH (undisclosed target - preclinical), Outpost Medicine, LLC (undisclosed target - preclinical), and Eisai Co., Ltd. and Eisai Inc. (BELVIQ(®) - marketed product).
Forward-Looking Statements
Certain statements in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements may be identified by words such as "eligible to," "potentially," "position for," "potential," "look forward to," "intended for," "planning," "in development for," "targeting," "will," "driven to," "being evaluated for," "evaluating for," and "target," and include, without limitation, statements about the following: design, initiation, enrollment, results, data readouts, data presentations, and timing relating to ongoing and intended preclinical and clinical trials; the potential of Arena's drug candidates, including to be first- or best-in-class or transformative, have optimized pharmacology and pharmacokinetics, have broad clinical utility, and be delivered to patients globally; the strength of Arena's pipeline; Arena's position and ability to execute on its programs; Arena's investment community conference call and webcast; Arena's drive; and the potential of Arena's assets, programs, licenses, and collaborations. For such statements, Arena claims the protection of the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from Arena's expectations. Factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to, the following: clinical trials and other studies may not proceed at the time or in the manner expected or at all; the timing and outcome of research, development and regulatory review is uncertain, and Arena's drug candidates may not advance in development or be approved for marketing; enrolling patients in Arena's ongoing and intended clinical trials is competitive and challenging; risks related to developing and commercializing drugs; Arena may need additional funds to advance all of its programs, and you and others may not agree with the manner Arena allocates its resources; risks and uncertainties relating to cash and revenues that may be generated from product sales or other sources, including the impact of competition; Arena's revenues are based in part on estimates, judgment and accounting policies, and incorrect estimates or disagreement regarding estimates or accounting policies may result in changes to Arena's guidance or previously reported results; risks related to unexpected or unfavorable new data; nonclinical and clinical data is voluminous and detailed, and regulatory agencies may interpret or weigh the importance of data differently and reach different conclusions than Arena or others, request additional information, have additional recommendations or change their guidance or requirements before or after approval; results of clinical trials and other studies are subject to different interpretations and may not be predictive of future results; topline data may not accurately reflect the complete results of a particular study or trial; satisfactory resolution of litigation or other disagreements with others; government and third-party payor actions, including relating to reimbursement and pricing; risks related to relying on collaborative arrangements; the entry into or modification or termination of collaborative arrangements; and Arena's and third parties' intellectual property rights. Additional factors that could cause actual results to differ materially from those stated or implied by Arena's forward-looking statements are disclosed in Arena's filings with the Securities and Exchange Commission (SEC), including but not limited to Arena's Quarterly Report on Form 10-Q for the quarter ended September 30, 2018, which was filed with the SEC on November 8, 2018. These forward-looking statements represent Arena's judgment as of the time of this release. Arena disclaims any intent or obligation to update these forward-looking statements, other than as may be required under applicable law.
Corporate Contact:
Kevin R. Lind
Arena Pharmaceuticals, Inc.
Executive Vice President and
Chief Financial Officer
klind@arenapharm.com
858.210.3636
Media Contact:
Matt Middleman, MD
LifeSci Public Relations
matt.middleman@lifescipublicrelations.com
646.627.8384
(Tables Follow)
Arena Pharmaceuticals, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
Three months ended
Year ended
December 31,
December 31,
2018 2017 2018 2017
(unaudited)
Revenues
Collaboration and other
revenue $6,878 $14,193 $11,402 $19,632
Royalty revenue 1,770 1,171 6,568 1,705
Total revenues 8,648 15,364 17,970 21,337
Operating Costs & Expenses
Research & development 37,890 20,711 115,029 70,988
General & administrative 15,402 8,253 47,724 30,341
Litigation settlement
expense, net 11,975
Total operating costs &
expenses 53,292 28,964 162,753 113,304
Total interest & other
income (expense), net 3,090 (670) 5,949 (3,887)
Loss from continuing
operations before
income taxes (41,554) (14,270) (138,834) (95,854)
Income tax benefit 110,265 110,265
Income (loss) loss from
continuing operations 68,711 (14,270) (28,569) (95,854)
Income (loss) from
discontinued operations 315 (830) 3,122
Net income (loss) 68,711 (13,995) (29,399) (92,732)
Less net loss
attributable to
noncontrolling interest
in consolidated
variable interest
entity 271 1,325
Net income (loss)
attributable to
stockholders of Arena $68,711 $(13,684) $(29,399) $(91,407)
Amounts attributable to
stockholders of Arena:
Income (loss) from
continuing operations $68,711 $(13,999) $(28,569) $(94,529)
Income (loss) from
discontinued operations 315 (830) 3,122
$68,711 $(13,684) $(29,399) $(91,407)
Net income (
loss)
attributable to stockholders of
Arena
per share, basic:
Continuing operations $1.39 $(0.36) $(0.61) $(2.87)
Discontinued operations 0.01 (0.02) 0.10
$1.39 $(0.35) $(0.63) $(2.77)
Net income (
loss)
attributable to stockholders of
Arena
per share,
diluted:
Continuing operations $1.35 $(0.36) $(0.61) $(2.87)
Discontinued operations 0.01 (0.02) 0.10
$1.35 $(0.35) $(0.63) $(2.77)
Shares used in
calculating net income
(loss) attributable to
stockholders of Arena
per share, basic: 49,409 39,268 47,041 32,990
Shares used in
calculating net income
(loss) attributable to
stockholders of Arena
per share, diluted: 50,826 39,268 47,041 32,990
Arena Pharmaceuticals, Inc.
Condensed Consolidated Balance Sheet Data
(In thousands)
(unaudited)
December 31, 2018 December 31, 2017
---
(1) (1)
Assets
Cash & cash
equivalents $161,037 $158,837
Accounts receivable 5,086 2,357
Deferred tax assets 110,333 -
Insurance recovery
receivable - 12,025
Prepaid expenses &
other current assets 10,008 2,681
Total available-for-
sale investments 367,006 112,482
Land, property &
equipment, net 23,114 30,131
Other non-current
assets 10,319 3,622
Assets of disposal
group held for sale - 17,140
---
Total assets $686,903 $339,275
Liabilities & Stockholders' Equity
Accounts payable &
accrued liabilities $26,635 $15,622
Accrued litigation
settlement - 24,000
Total deferred
revenues - 2,177
Total lease financing
obligations & other
long-term
liabilities 54,010 62,737
Liabilities of
disposal group held
for sale - 27,595
Total stockholders'
equity 606,258 207,144
Total liabilities &
stockholders' equity $686,903 $339,275
(1)
The Condensed
Consolidated Balance Sheet Data
has been derived from the
audited financial statements as
of that date.
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