Akili Reports Third Quarter 2022 Financial Results and Company Update
Akili, Inc. (Nasdaq: AKLI), a leading digital medicine company, today reported its financial results for the quarter ended September 30, 2022, and provided an update on business progress.
"We achieved two important milestones this quarter on our path to bring digital treatments to mainstream medicine - we began trading on Nasdaq and raised funds to support our first product launch and advance our pipeline, and we transitioned from pre-launch to launch of EndeavorRx," said Eddie Martucci, chief executive officer of Akili. "With a solid foundation and experienced team in place, Akili is well-positioned to advance our vision of EndeavorRx becoming part of routine medical care for children with ADHD." (See below for EndeavorRx full indication and safety information.)
"Prescriptions for EndeavorRx have been written across all 50 states, and market uptake continues to grow," said Matt Franklin, president and chief operating officer of Akili. "We have now executed the first phase of our commercial launch of EndeavorRx, hiring, training and deploying our initial sales force into priority territories to help us accelerate adoption."
Recent Business Updates
Third Quarter 2022 Financial Highlights
For additional information, please see the tables below, which include a reconciliation of the non-GAAP financial measures to GAAP financial measures.
Webcast and Conference Call
Akili will host a conference call and webcast today, Thursday, November 10, 2022, at 4:30 p.m. ET. A live audio webcast of the conference call and presentation will be available at www.akiliinteractive.com under Investor Relations, Events & Presentations. An archived version of the webcast will be available on the company's website following the event.
To access the call, dial 877-405-1224 (toll-free) or 201-389-0848 (international) and reference "Akili Q3 Results." International toll-free numbers are available here.
Non-GAAP Financial Measures
In addition to financial information prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP), this press release includes the following non-GAAP financial measures: non-GAAP total operating expenses on a historical basis, non-GAAP R&D expenses on a historical basis, non-GAAP SG&A expenses on a historical basis, and non-GAAP net loss on a historical basis. Akili derives these non-GAAP financial measures by excluding certain expenses and other items from the respective GAAP financial measure that is most directly comparable to each non-GAAP financial measure. Specifically, the non-GAAP total operating expenses, non-GAAP R&D expenses, and non-GAAP SG&A expenses exclude stock-based compensation expense and transaction costs allocated to earnout shares, and non-GAAP net loss excludes stock-based compensation expense, transaction costs allocated to earnout shares, and the change in estimated fair value of earn-out liabilities. Akili's management believes that these non-GAAP financial measures are useful to both management and investors in analyzing its ongoing business and operating performance. Management does not intend the presentation of these non-GAAP financial measures to be considered in isolation or as a substitute for results prepared in accordance with GAAP, but as a complement to provide greater transparency. In addition, these non-GAAP financial measures may differ from similarly named measures used by other companies. A reconciliation of the non-GAAP financial measures to GAAP financial measures is included in the attached financial tables.
EndeavorRx Indication and Overview
EndeavorRx is the first-and-only FDA-authorized treatment delivered through a video game experience. EndeavorRx is indicated to improve attention function as measured by computer-based testing in children ages 8 to 12 years old with primarily inattentive or combined-type ADHD, who have a demonstrated attention issue. Patients who engage with EndeavorRx demonstrate improvements in a digitally assessed measure Test of Variables of Attention (TOVA®) of sustained and selective attention and may not display benefits in typical behavioral symptoms, such as hyperactivity. EndeavorRx should be considered for use as part of a therapeutic program that may include clinician-directed therapy, medication, and/or educational programs, which further address symptoms of the disorder. EndeavorRx is available by prescription only. It is not intended to be used as a stand-alone therapeutic and is not a substitution for a child's medication. The most common side effect observed in children in EndeavorRx's clinical trials was a feeling of frustration, as the game can be quite challenging at times. No serious adverse events were associated with its use. EndeavorRx is recommended to be used for approximately 25 minutes a day, 5 days a week, over initially at least 4 consecutive weeks, or as recommended by your child's health care provider. To learn more about EndeavorRx, please visit EndeavorRx.com.
Akili is pioneering the development of cognitive treatments through game-changing technologies. Akili's approach of leveraging technologies designed to directly target the brain establishes a new category of medicine - medicine that is validated through clinical trials like a drug or medical device but experienced like entertainment. Akili's platform is powered by proprietary therapeutic engines designed to target cognitive impairment at its source in the brain, informed by decades of research and validated through rigorous clinical programs. Driven by Akili's belief that effective medicine can also be fun and engaging, Akili's products are delivered through captivating action video game experiences. For more information, please visit www.akiliinteractive.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties.
These forward-looking statements include, without limitation, statements in this press release related to: our vision for EndeavorRx; the commercial launch of EndeavorRx and our plans to scale our commercialization efforts and personnel; the anticipated acceleration of market uptake and insurance coverage of EndeavorRx; the development and advancement of our pipeline of digital therapeutics product candidates for other patient populations; our plans to use data from patients and caregivers to expand the real-world evidence base; and our expectation that our existing cash, cash equivalents, and short-term investments will be sufficient to fund our current and planned operations until mid-2024. Any forward-looking statements in this press release are based on management's current expectations and beliefs and are subject to a number of risks, uncertainties and important factors that may cause actual events or results to differ materially from those expressed or implied by any forward-looking statements contained in this press release, including, without limitation, risks and uncertainties related to: our ability to successfully commercialize EndeavorRx; our ability to successfully create, and navigate, a new category of medicine and to achieve broad adoption of digital therapeutics among healthcare providers, caregivers, and patients; our ability to obtain and maintain adequate coverage and reimbursement for our digital therapeutics; our ability to continue to advance our clinical development pipeline; our ability to defend our intellectual property and satisfy various FDA and other regulatory requirements in and outside of the United States; the impact of the COVID-19 pandemic on our business; the risk of downturns and a changing regulatory landscape in the highly competitive industry in which we operate; the timing and results expected from our and our partners' clinical trials and our reliance on third parties for certain aspects of our business; our ability to accurately estimate expenses, capital requirements, and needs for additional financing; and other risks identified in our current filings and any subsequent filings made with the Securities and Exchange Commission (SEC). We caution you not to place undue reliance on any forward-looking statements, which speak only as of the date hereof and should not be relied upon as representing the company's views as of any subsequent date. We disclaim any obligation to publicly update or revise any such statements to reflect any change in expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.