Achillion Pharmaceuticals, Inc. (Nasdaq:ACHN)
today reported financial results for the three and nine months
ended September 30, 2015. For the third quarter of 2015, Achillion
reported a net income of $26.3 million or $0.19 per share, compared
with a net loss of $15.7 million or $0.16 per share for the third
quarter of 2014. Cash, cash equivalents, marketable securities, and
interest receivable as of September 30, 2015 were $476
million.
“In just the few months following our announced
worldwide collaboration with Janssen, I am pleased with the
significant progress achieved in advancing short duration therapy
for HCV, highlighted by the recently initiated Phase 2a trial
evaluating a regimen consisting of odalasvir, simeprevir and
ALS-335. We look forward to next quarter when we anticipate
top-line SVR results from this study", commented Milind S.
Deshpande, Ph.D., President and Chief Executive Officer of
Achillion."
Dr. Deshpande continued, “Significant progress
has been made with our internally discovered complement inhibitor
platform. We anticipate making a regulatory filing by year-end that
will allow for initiation of human clinical trials with our first
small-molecule factor D inhibitor in the first quarter. The
advances in our program are highlighted by the research generated
by Dr. Robert Brodsky and his colleagues from Johns Hopkins
University which has been selected for both an oral presentation at
the ASH Annual Meeting this December and inclusion in the 2016
Highlights of ASH.”
Third Quarter Results
For the three months ended September 30, 2015,
Achillion reported a net income of $26.3 million compared with a
net loss of $15.7 million during the same period of 2014.During the
third quarter, Achillion and Janssen Pharmaceuticals, Inc.
(Janssen), one of the Janssen Pharmaceutical Companies of Johnson
& Johnson, completed the closing of the collaboration providing
Janssen with an exclusive, worldwide license to develop and, upon
regulatory approval, commercialize HCV products and regimens
containing one or more of Achillion’s HCV assets. Assuming
successful development and commercialization, Achillion is eligible
to receive up to $905 million in clinical, regulatory and
commercialization milestone payments. Achillion is also eligible to
receive tiered royalty percentages between mid-teens and
low-twenties based upon future worldwide sales. Janssen is
responsible for all of the development costs within the
collaboration and all subsequent costs related to commercialization
of the HCV assets. Achillion received $225 million from Johnson
& Johnson Innovation – JJDC, Inc. following the issuance of
18,367,346 shares of Achillion at a price of $12.25 per share.
Achillion recognized in the third quarter of
2015 revenue of $33.8 million under the Janssen Agreement,
representing a portion of the premium paid by JJDC associated with
its equity purchase of Achillion common stock which is being
recognized over the 180-day technology transfer period. No revenue
was recognized during the three months ended September 30,
2014.
Research and development expenses were $12.0
million for the three months ended September 30, 2015, compared
with $12.1 million for the same period of 2014. The increase was
primarily due to increased preclinical and manufacturing costs
related to our complement inhibitor program and increased
manufacturing costs related to ACH-3422. These amounts were
partially offset by decreased clinical trial costs related to our
odalasvir and sofosbuvir combination trial and ACH-2684 clinical
and manufacturing costs. Personnel and non-cash stock-based
compensation costs also increased due to the addition of personnel
in our development group.
General and administrative expenses were $4.9
million for the three months ended September 30, 2015, compared
with $3.7 million incurred during the same period in 2014. The
increase for the three months ended September 30, 2015 was
primarily due to increased business consulting and corporate legal
fees related to the Janssen Agreement, increased corporate fees and
taxes, and increased personnel and non-cash stock-based
compensation costs addition of personnel.
Non-cash stock compensation expense totaled $2.2
million for the third quarter of 2015 as compared with $1.6 million
for the third quarter of 2014 and is included in research and
development and general and administrative expenses.
Nine Month Results
For the nine months ended September 30, 2015,
Achillion reported a net loss of $22 million, compared to a net
loss of $47.4 million in the same period in 2014. During the nine
months ended September 30, 2015, Achillion recognized revenue of
$34.5 million under the Janssen Agreement, representing a portion
of the premium paid by JJDC associated with its equity purchase of
Achillion common stock which is being recognized over the 180-day
technology transfer period. No revenue was recognized during the
nine months ended September 30, 2014.
For the nine months ended September 30, 2015,
research and development expenses totaled $46.9 million, compared
with $37.1 million during the same period in 2014. The increase was
primarily due to increased preclinical and manufacturing costs
related to our complement inhibitor program and increased
manufacturing costs related to ACH-3422. These amounts were
partially offset by decreased clinical trial costs related to our
odalasvir and sofosbuvir combination trial and ACH-2684 clinical
and manufacturing costs. Personnel and non-cash stock-based
compensation costs also increased due to the addition of personnel
in our development group.
For the nine months ended September 30, 2015,
general and administrative expenses were $19.2 million, compared
with $10.7 million incurred during the same period in 2014. The
increase for the nine months ended September 30, 2015 was primarily
due to increased business consulting and corporate legal fees
related to the Janssen Agreement, increased corporate fees and
taxes, and increased personnel and non-cash stock-based
compensation costs addition of personnel.
Non-cash stock compensation expense totaled $7.5
million for the nine months ended September 30, 2015 as compared
with $4.8 million for the same period in 2014, and is included in
research and development and general and administrative
expenses.
Updated Financial Guidance
At September 30, 2015, Achillion had cash, cash
equivalents, marketable securities, and interest receivable of $476
million. The Company expects total annual revenue to be $66
million, representing the total premium paid by JJDC associated
with its equity purchase of Achillion common stock. The Company
reiterated its expectation that research and development expenses
during 2015 will be approximately $60-65 million, compared to
previously provided guidance of $85 - $95 million, and that general
and administrative expenses will be $24 - 25 million with an annual
net loss anticipated of $18 - 20 million. Net cash used in
operating activities in 2015 is expected to be approximately $60 -
65 million, exclusive of the $66 million in revenue associated with
the JJDC premium, based on current operating plans, timelines and
costs, as compared to previous guidance of $100 - $110 million. The
net loss per share for fiscal year ending December 31, 2015, is
anticipated to be approximately $0.08 - 0.10 per share.
Complement Factor D Inhibitor Program:
Upcoming milestones
- Oral presentation discussing in vitro results of factor D
inhibitors for PNH and aHUS at the 2015 ASH Annual Meeting on
Sunday, December 6, 2015; and
- Complement Symposium to discuss the biology of the complement
system with a focus on the complement alternative pathway and the
role of factor D. Webcast replay will be available beginning
Sunday, December 6, 2015 and can be accessed at
http://www.achillion.com or http://ir.achillion.com.
HCV: Janssen Program status
- Announced in August 2015 Janssen’s initiation of a phase 1
drug-drug interaction study in healthy volunteers assessing the
combination of odalasvir (ACH-3102), simeprevir, and ALS-335;
and
- Announced in October 2015 that Janssen initiated dosing of
patients in a Phase 2a clinical trial for treatment-naïve genotype
1 chronic HCV with the once-daily combination of odalasvir
(ACH-3102), simeprevir, and ALS-335. Patients will be randomized to
treatment durations of eight, six, or four weeks.
About Complement Factor D
Platform
Achillion has leveraged its internal discovery
capabilities and a novel complement-related platform to develop
small molecule inhibitors of complement factor D. Factor D is an
essential serine protease involved in the complement pathway, a
part of the innate immune system. Achillion’s complement platform
is focused on advancing compounds that inhibit factor D, can be
orally-administered, and can potentially be used in the treatment
of immune-related diseases in which complement plays a critical
role. Potential indications being evaluated for these compounds
include paroxysmal nocturnal hemoglobinuria (PNH), atypical
hemolytic uremic syndrome (aHUS), myasthenia gravis, dry
age-related macular degeneration (dry AMD), and other therapeutic
indications. Achillion anticipates that its platform could play a
role in addressing the needs of all PNH patients, including
patients who have suboptimal response to, or fail to respond to,
the currently available treatment, as well as for patients
suffering from other complement-mediated diseases.
About HCV
The hepatitis C virus is the most common cause
of viral hepatitis, which is an inflammation of the liver. It is
currently estimated that more than 150 million people are infected
with HCV worldwide including more than 5 million people in the
United States. Three-fourths of the global HCV patient population
is undiagnosed; it is a silent epidemic and a major global health
threat. Chronic hepatitis, if left untreated, can lead to permanent
liver damage that can result in the development of liver cancer,
liver failure or death. Few therapeutic options currently exist for
the treatment of HCV infection.
About Achillion
Pharmaceuticals
Achillion is seeking to apply its expertise in
biology and structure-guided design and a deep understanding of
patient and clinician needs to develop innovative treatment
solutions aimed at improving patients’ lives. The company’s
scientific excellence, integrated capabilities and experienced team
position it to successfully achieve its goal of advancing new
products along the entire continuum from the bench to the patient.
Achillion’s pipeline is currently focused on small molecule
therapeutics for chronic hepatitis C viral infection (HCV) and
complement-related diseases through the inhibition of complement
factor D. More information is available at
http://www.achillion.com.
Cautionary Note Regarding
Forward-Looking Statements
This press release includes forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 that are subject to risks, uncertainties and
other important factors that could cause actual results to differ
materially from those indicated by such forward-looking statements,
including statements with respect to: the potential benefits and
prospects for the combined Janssen-Achillion portfolio of HCV
compounds; the potential benefits and prospects for Achillion's
portfolio of complement inhibitors; the expected efficiency and
benefits of Janssen's clinical trial design approaches; the
Company’s goals and plans with respect to advancing complement
inhibitor compounds into clinical development; and the commercially
competitive position of the Company’s portfolio of drug candidates.
Achillion may use words such as “expect,” “anticipate,” “project,”
“intend,” “plan,” “aim,” “believe,” “seek,” “ estimate,” “can,”
“may,” “will,” “would,” and “should” and similar expressions to
identify such forward-looking statements. Among the important
factors that could cause actual results to differ materially from
those indicated by such forward-looking statements are risks
relating to, among other things Achillion’s ability to: demonstrate
in any current and future clinical trials the requisite safety,
efficacy and combinability of its drug candidates; advance the
preclinical and clinical development of its complement inhibitors;
obtain and maintain necessary regulatory approvals; obtain and
maintain patent protection for its drug candidates and the freedom
to operate under third party intellectual property; establish
commercial manufacturing arrangements; identify, enter into and
maintain collaboration agreements with appropriate third-parties;
compete successfully with numerous other companies that are seeking
to develop improved therapies for the treatment of HCV and for
complement-mediated diseases; manage expenses; and successfully
execute on its business strategies. These and other risks are
described in the reports filed by Achillion with the U.S.
Securities and Exchange Commission, including its Annual Report on
Form 10-K for the year-ended December 31, 2014 and its Quarterly
Report on Form 10-Q for the quarter ended June 30, 2015.
In addition, any forward-looking statements in
this press release represent Achillion’s views only as of the date
of this press release and should not be relied upon as representing
its views as of any subsequent date. Achillion disclaims any duty
to update any forward-looking statement, except as required by
applicable law.
ACHILLION PHARMACEUTICALS INC. (ACHN) |
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Statements of
Operations |
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(Unaudited, in thousands, except per share
amounts) |
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Three Months
Ended |
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Nine Months
Ended |
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September
30, |
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September
30, |
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2015 |
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2014 |
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2015 |
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2014 |
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Revenue |
$ |
33,820 |
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|
$ |
- |
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$ |
34,531 |
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|
$ |
- |
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Operating
expenses: |
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Research and
development |
|
11,983 |
|
|
|
12,070 |
|
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|
46,912 |
|
|
|
37,089 |
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General and
administrative |
|
4,856 |
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|
3,694 |
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|
19,226 |
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|
10,676 |
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Total operating
expenses |
|
16,839 |
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|
15,764 |
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66,138 |
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47,765 |
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Loss from
operations |
|
16,981 |
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|
|
(15,764 |
) |
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|
(31,607 |
) |
|
|
(47,765 |
) |
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Other income
(expense): |
|
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|
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Interest income |
|
346 |
|
|
|
101 |
|
|
|
723 |
|
|
|
376 |
|
|
Interest expense |
|
(12 |
) |
|
|
(4 |
) |
|
|
(42 |
) |
|
|
(23 |
) |
|
Other Income |
|
8,944 |
|
|
|
- |
|
|
|
8,944 |
|
|
|
- |
|
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NetIncome
(loss) |
$ |
26,259 |
|
|
$ |
(15,667 |
) |
|
$ |
(21,982 |
) |
|
$ |
(47,412 |
) |
|
|
|
|
|
|
|
|
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|
Net income (loss) per
share - basic |
$ |
0.19 |
|
|
$ |
(0.16 |
) |
|
$ |
(0.18 |
) |
|
$ |
(0.49 |
) |
|
Net income (loss) per
share - diluted |
$ |
0.19 |
|
|
$ |
(0.16 |
) |
|
$ |
(0.18 |
) |
|
$ |
(0.49 |
) |
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|
|
|
|
|
|
|
|
Weighted average shares
outstanding - basic |
|
136,439 |
|
|
|
99,031 |
|
|
|
121,896 |
|
|
|
97,622 |
|
|
Weighted average shares
outstanding - diluted |
|
140,024 |
|
|
|
99,031 |
|
|
|
121,896 |
|
|
|
97,622 |
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Balance Sheets |
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(Unaudited, in thousands) |
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|
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|
|
|
September
30, |
|
December
31, |
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
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|
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|
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|
|
Cash, cash equivalents,
marketable securities and interest and subscriptions
receivable |
$ |
476,022 |
|
|
$ |
159,167 |
|
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Working capital |
|
415,775 |
|
|
|
141,816 |
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Total assets |
|
479,511 |
|
|
|
156,807 |
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Long-term
liabilities |
|
288 |
|
|
|
279 |
|
|
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Total liabilities |
|
49,771 |
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|
|
13,338 |
|
|
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Total stockholders'
equity |
|
429,740 |
|
|
|
143,469 |
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Company Contact:
Glenn Schulman
Achillion Pharmaceuticals, Inc.
Tel. (203) 624-7000
gschulman@achillion.com
Investors:
Mary Kay Fenton
Achillion Pharmaceuticals, Inc.
Tel. (203) 624-7000
mfenton@achillion.com
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