[August 07, 2017] |
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Enanta Pharmaceuticals Reports Financial Results for its Fiscal Third Quarter Ended June 30, 2017
Enanta Pharmaceuticals, Inc. (NASDAQ:ENTA), a research and
development-focused biotechnology company dedicated to creating small
molecule drugs for viral infections and liver diseases, today reported
financial results for its fiscal third quarter ended June 30, 2017.
Enanta's cash, cash equivalents and short-term and long-term marketable
securities totaled $235.3 million at June 30, 2017. This compares to a
total of $242.2 million in such accounts at September 30, 2016. Enanta
expects that its current cash, cash equivalents and marketable
securities will be sufficient to meet the anticipated cash requirements
of its existing business and development programs for the foreseeable
future.
Fiscal Third Quarter Ended June 30, 2017 Financial Results
Total revenue for the three months ended June 30, 2017 was $7.5 million,
compared to $14.0 million for the three months ended June 30, 2016. For
the nine months ended June 30, 2017, total revenue was $26.9 million,
compared to $75.4 million for the same period in 2016. For the three and
nine month periods ended June 30, 2017, revenue consisted exclusively of
royalties earned on AbbVie's worldwide net sales of HCV regimens
containing paritaprevir. For the 2016 nine month period, revenue
consisted primarily of royalty revenues as well as a $30.0 million
milestone payment for the reimbursement approval of VIEKIRAX® in Japan
in November 2015. Milestone payments and royalties have varied
significantly from period to period, and we expect that variability to
continue in the future.
Research and development expenses totaled $15.4 million for the three
months ended June 30, 2017, compared to $10.8 million for the three
months ended June 30, 2016. For the nine months ended June 30, 2017,
research and development expenses totaled $40.9 million compared to
$29.0 million for the same period in 2016. The increase in research and
development expenses in both periods was primarily due to increased
preclinical and clinical costs associated with the progression of
Enanta's wholly-owned R&D programs in non-alcoholic steatohepatitis
(NASH)/primary biliary cholangitis (PBC), respiratory syncytial virus
(RSV) and hepatitis B virus (HBV).
General and administrative expenses totaled $5.2 million for the three
months ended June 30, 2017, compared to $4.3 million for the three
months ended June 30, 2016. For the nine months ended June 30, 2017,
general and administrative expenses totaled $15.6 million, compared to
$12.5 million for the same period in 2016. For the three month period,
the increase in general and administrative expenses was primarily due to
increases in compensation expense driven substantially by increased
headcount. For the nine month period, the increase was due to increased
headcount as well as achievement of milestones under existing
performance-based stock awards.
Enanta recorded an income tax benefit for the three months ended June
30, 2017 of $4.1 million compared to an income tax expense of $0.4
million for the same period in 2016. The Company's estimated annual
effective tax rate for fiscal 2017 of approximately 33% was slightly
below the statutory rate of 35% due to the availability of research and
development tax credits.
The net loss for the three months ended June 30, 2017 was $8.4 million,
or $(0.44) per diluted common share, compared to a net loss of $1.1
million, or $(0.06) per diluted common share, for the corresponding
period in 2016. For the nine months ended June 30, 2017, net loss was
$18.8 million, or $(0.99) per diluted common share, compared to net
income of $23.5 million, or $1.22 per diluted common share, for the
corresponding period in 2016.
"Enanta continues to make great progress from a research and development
perspective," stated Jay R. Luly, Ph.D., President and Chief Executive
Officer of Enanta. Our second commercialized protease inhibitor product,
glecaprevir, is one of the two new DAAs in AbbVie's new pan-genotypic
treatment regimen for HCV, which was recently approved in the EU and in
the U.S. under the names MAVIRET™ and MAVYRET™, respectively.
Additionally, data from the Phase 1 clinical study on our NASH candidate
EDP-305 will be available soon, and, with our strong cash resources of
over $235 million, we are well funded to continue to advance our
clinical programs in NASH, PBC, RSV and HCV."
Development Program and Business Review
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On June 25 at the XIX International Symposium on Respiratory Viral
Infections in Berlin, Germany, Enanta presented data on its
respiratory syncytial virus inhibitor candidate EDP-938, which
demonstrated a greater than 4-log reduction in viral load in an animal
model challenged with RSV. Enanta expects to initiate a Phase 1
clinical study with EDP-938 during the fourth quarter of calendar 2017.
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On July 28, the European Commission granted AbbVie marketing
authorization for MAVIRET (glecaprevir/pibrentasvir), and on August 3,
the U.S. Food and Drug Administration (FDA) granted AbbVie marketing
approval for MAVYRET (glecaprevir/pibrentasvir), sometimes referred to
as the G/P regimen, AbbVie's new pan-genotypic treatment for patients
with chronic hepatitis C virus (HCV) infection. Glecaprevir is
Enanta's second protease inhibitor being developed and commercialized
by AbbVie and is one of the two new direct-acting antivirals in G/P.
Enanta earned a total of $65 million in milestone payments following
the EU and U.S. approvals. Enanta is eligible to earn the remaining
$15 million milestone payment upon G/P receiving commercial regulatory
approval in Japan, which is anticipated next quarter. Additionally,
Enanta is eligible to receive annually tiered, double digit, per
product royalties on 50% of the net sales of G/P.
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Enanta expects to announce clinical data from its ongoing Phase 1
clinical study of EDP-305 in healthy volunteers and presumed NAFLD
subjects1 at the AASLD meeting in October and is conducting
NASH-enabling studies during the second half of this year. A Phase 2
study in PBC is also expected to begin in the next quarter, and a
Phase 2 study in NASH is expected to begin in early 2018.
Upcoming Events and Presentations
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September 6, 2017 - Baird 2017 Global Healthcare Conference, New York
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September 11-13, 2017 - Morgan Stanley 15th Annual Global
Healthcare Conference, New York
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September 25-27, 2017 - Cantor Fitzgerald Global Healthcare
Conference, New York
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Enanta plans to issue its fiscal fourth quarter financial results
press release, and hold a conference call regarding those results, on
November 20, 2017.
Conference Call and Webcast Information Enanta will host a
conference call and webcast today at 4:30 p.m. ET. To participate in the
live conference call, please dial (855) 840-0595 in the U.S. or (518)
444-4814 for international callers. A replay of the conference call will
be available starting at approximately 7:30 p.m. ET on August 7, 2017,
through 11:59 p.m. ET on August 10, 2017 by dialing (855) 859-2056 from
the U.S. or (404) 537-3406 for international callers. The passcode for
both the live call and the replay is 47670579. A live audio webcast of
the call and replay can be accessed by visiting the "Events and
Presentation" section on the "Investors" page of Enanta's website at www.enanta.com.
About Enanta Enanta Pharmaceuticals is a research and
development-focused biotechnology company that uses its robust
chemistry-driven approach and drug discovery capabilities to create
small molecule drugs for viral infections and liver diseases. Enanta's
research and development efforts are currently focused on the following
disease targets: non-alcoholic steatohepatitis (NASH)/ primary biliary
cholangitis (PBC), respiratory syncytial virus (RSV) and hepatitis B
virus (HBV). Enanta has also discovered novel protease inhibitors that
have been developed as part of AbbVie's hepatitis C virus (HCV)
treatment regimens under a collaboration that now provides Enanta a
payment stream, which it is using to fund its research and development
programs. Please visit www.enanta.com
for more information on Enanta's programs and pipeline.
Forward Looking Statements This press release contains
forward-looking statements, including statements with respect to the
prospects for AbbVie's G/P regimen in HCV and the prospects for
advancement of Enanta's earlier stage programs in NASH/PBC and RSV.
Statements that are not historical facts are based on management's
current expectations, estimates, forecasts and projections about
Enanta's business and the industry in which it operates and management's
beliefs and assumptions. The statements contained in this release are
not guarantees of future performance and involve certain risks,
uncertainties and assumptions, which are difficult to predict.
Therefore, actual outcomes and results may differ materially from what
is expressed in such forward-looking statements. Important factors and
risks that may affect actual results include: Enanta's revenues in the
short-term are dependent upon the success of AbbVie's continuing
commercialization efforts for its HCV treatment regimens containing
paritaprevir and its efforts to obtain additional regulatory approvals
for G/P and commercialize that regimen; competitive pricing, market
acceptance and reimbursement rates of AbbVie's treatment regimens
containing paritaprevir or its G/P combination compared to competitive
HCV products on the market and product candidates of other companies
under development; the discovery and development risks of early stage
discovery efforts in other disease areas such as NASH, PBC, RSV and HBV;
potential competition from the development efforts of others in those
other disease areas; Enanta's lack of clinical development experience;
Enanta's need to attract and retain senior management and key scientific
personnel; Enanta's need to obtain and maintain patent protection for
its product candidates and avoid potential infringement of the
intellectual property rights of others; and other risk factors described
or referred to in "Risk Factors" in Enanta's most recent Form 10-K for
the fiscal year ended September 30, 2016 and other periodic reports
filed more recently with the Securities and Exchange Commission. Enanta
cautions investors not to place undue reliance on the forward-looking
statements contained in this release. These statements speak only as of
the date of this release, and Enanta undertakes no obligation to update
or revise these statements, except as may be required by law.
1 Presumed NAFLD subjects in this study are obese subjects,
with or without pre-diabetes or type-2 diabetes.
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ENANTA PHARMACEUTICALS, INC.
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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UNAUDITED
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(in thousands, except per share amounts)
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Three Months Ended
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Nine Months Ended
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June 30,
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June 30,
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2017
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2016
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2017
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2016
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Revenue
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$
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7,511
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$
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13,978
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$
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26,887
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$
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75,427
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Operating expenses
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Research and development
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15,407
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10,785
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40,937
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28,961
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General and administrative
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5,233
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4,282
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15,631
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12,526
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Total operating expenses
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20,640
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15,067
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56,568
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41,487
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Income (loss) from operations
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(13,129)
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(1,089)
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(29,681)
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33,940
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Other income, net
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600
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447
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1,673
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1,248
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Income (loss) before income taxes
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(12,529)
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(642)
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(28,008)
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35,188
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Income tax (expense) benefit
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4,103
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(434)
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9,210
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(11,720)
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Net income (loss)
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$
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(8,426)
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$
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(1,076)
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$
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(18,798)
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$
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23,468
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Net income (loss) per share
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Basic
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$
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(0.44)
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$
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(0.06)
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$
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(0.99)
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$
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1.24
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Diluted
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$
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(0.44)
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$
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(0.06)
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$
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(0.99)
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$
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1.22
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Weighted average common shares outstanding
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Basic
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19,081
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18,983
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19,055
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18,893
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Diluted
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19,081
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18,983
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19,055
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19,223
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ENANTA PHARMACEUTICALS, INC.
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CONDENSED CONSOLIDATED BALANCE SHEETS
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UNAUDITED
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(in thousands)
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June 30,
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September 30,
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2017
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2016
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Assets
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Current assets
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Cash and cash equivalents
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$
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22,263
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$
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16,577
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Short-term marketable securities
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169,752
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193,507
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Accounts receivable
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7,511
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12,841
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Prepaid expenses and other current assets
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6,589
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9,231
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Total current assets
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206,115
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232,156
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Property and equipment, net
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8,070
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8,004
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Long-term marketable securities
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43,321
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32,119
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Deferred tax assets
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17,723
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8,390
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Restricted cash
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608
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608
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Total assets
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$
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275,837
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$
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281,277
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Liabilities and Stockholders' Equity
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Current liabilities
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Accounts payable
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$
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5,488
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$
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3,377
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Accrued expenses and other current liabilities
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5,634
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4,512
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Total current liabilities
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11,122
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7,889
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Warrant liability
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1,291
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1,251
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Series 1 nonconvertible preferred stock
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164
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159
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Other long-term liabilities
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2,394
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2,042
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Total liabilities
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14,971
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11,341
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Total stockholders' equity
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260,866
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269,936
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Total liabilities and stockholders' equity
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$
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275,837
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$
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281,277
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View source version on businesswire.com: http://www.businesswire.com/news/home/20170807005934/en/
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