Liquidia Reports First Quarter 2022 Financial Results and Provides Corporate Update
- Secured access to new capital through debt and equity transactions
- Increased utilization of Treprostinil Injection with increasing payer generic mandates
- Advanced Hatch-Waxman litigation in support of final regulatory approval of YUTREPIA™ (treprostinil) inhalation powder
- Company to host webcast and conference call today at 8:30 a.m. ET
MORRISVILLE, N.C., May 12, 2022 (GLOBE NEWSWIRE) -- Liquidia Corporation (NASDAQ: LQDA) (“Liquidia” or the “Company”) today reported financial results for the first quarter ended March 31, 2022. The Company will host a webcast and conference call at 8:30 a.m. ET to discuss the first quarter 2022 financial results and provide a corporate update.
Roger Jeffs, Liquidia’s Chief Executive Officer, said: “Over the last quarter, the Company has continued to build a strong position clinically, commercially, and financially. Clinically, our patient experience continues to expand as we have now accrued more than 280 patient years of exposure with YUTREPIA (treprostinil) inhalation powder in our ongoing open-label study, supporting that YUTREPIA can be a durable treatment option for PAH patients. We remain confident in our ability to navigate our way to final FDA approval of YUTREPIA following our arguments presented at trial in Hatch-Waxman proceedings in March and the arguments we will make as part of the inter partes review at the Patent Trial Appeal Board this week. Commercially, we continue to increase the utilization of Treprostinil Injection with growing support from payers. And financially, as we prepare for a potential launch of YUTREPIA later this year, we fortified our balance sheet to support growing commercial, clinical and pipeline activities and continue to build an experienced and passionate team that is prepared to fulfill the unmet needs of patients seeking better treatment options.”
Secured access to additional capital through restructured debt and equity transactions to support commercialization and pipeline activity. In January 2022, the Company increased its existing credit facility with Silicon Valley Bank, providing access to up to $40.0 million in term loans of which the first $20.0 million was funded during the first quarter of 2022. On April 18, 2022, the Company closed on the sale of 11,274,510 shares of common stock in an underwritten registered public offering at an offering price of $5.10 per share with 19% of shares sold to Company insiders. Net proceeds of approximately $53.7 million were received after deducting the underwriting discounts and commissions and other offering expenses. The total cash on-hand enables the Company to launch YUTREPIA pending final FDA approval, initiate new clinical trials, including for WHO Group 3 patients, and advance its pre-clinical pipeline.
Drove increased utilization of Treprostinil Injection with increasing support of payer mandates. Liquidia’s revenue increased slightly to $3.5 million in the first quarter 2022 as compared to $3.1 million in first quarter 2021 despite a decrease in the profit split percentage from 80% to 50% per the terms of the promotion agreement with Sandoz. The increase in the number of units sold was driven largely by the implementation of payer mandates at national and regional levels to use generic treprostinil formulations over branded Remodulin® (treprostinil). Additional payers are expected to implement generic mandates in the second half of 2022 and into 2023.
Progressed legal proceedings to allow for final approval of YUTREPIA. The Company is actively involved in Hatch-Waxman litigation brought by United Therapeutics Corporation (UTC) in June 2020 involving three U.S. patents: No. 9,604,901 (the ’901 Patent), 9,593,066 (the ‘066 Patent) and 10,716,793 (the ‘793 Patent). Trial proceedings were held from March 28-31, 2022, and the Court set a post-trial briefing schedule to be concluded on June 15, 2022. The Company currently expects that a decision regarding the Hatch-Waxman litigation will be issued prior to the expiration of the 30-month regulatory stay in October 2022. At trial, the Company presented evidence of non-infringement and invalidity with respect to both the ’066 patent and the ‘793 patent, the two patents that remain at issue in the litigation. The ‘901 patent was withdrawn from litigation when UTC stipulated Liquidia’s non-infringement in December 2021. Concurrently, the U.S. Patent Trial and Appeal Board (PTAB) instituted an inter partes review (IPR) of the ‘793 Patent, finding that the Company had demonstrated a reasonable likelihood that it would prevail with respect to showing that at least one challenged claim of the ‘793 patent is unpatentable as obvious over the combination of certain prior art cited by the Company in its petition to the PTAB. A hearing before the PTAB will be held on May 13, 2022, and a final written decision determining the validity of the challenged claims of the ‘793 patent is expected in August 2022.
First Quarter 2022 Financial Results
Cash totaled $57.8 million as of March 31, 2022. On April 18, 2022, the Company received net proceeds of approximately $53.7 million from the sale of the common stock after deducting the underwriting discounts and commissions and other offering expenses related to the registered public offering.
Revenue was $3.5 million for the three months ended March 31, 2022, compared to $3.1 million for the three months ended March 31, 2021. Revenue related primarily to the Promotion Agreement. During the three months ended March 31, 2021, the profit split percentage the Company received under the Promotion Agreement was 80%, whereas during the three months ended March 31, 2022, the profit split percentage was 50%. This decrease in profit split percentage was offset by an increase in the number of units sold.
Cost of revenue was $0.7 million for the three months ended March 31, 2022, compared to $0.7 million for the three months ended March 31, 2021. Cost of revenue related to the Promotion Agreement as noted above.
Research and development expenses were $4.7 million for the three months ended March 31, 2022, compared with $6.1 million for the three months ended March 31, 2021. The decrease of $1.4 million or 21.9% was primarily due to the timing of manufacturing related to our YUTREPIA program. During the three months ended March 31, 2022, the Company incurred $1.6 million in expenses related to YUTREPIA compared to $2.7 million during the three months ended March 31, 2021.
General and administrative expenses were $12.5 million for the three months ended March 31, 2022, compared with $5.3 million for the three months ended March 31, 2021. The increase of $7.2 million or 135.0% was primarily due to a $3.3 million increase in stock-based compensation expense driven by a $2.9 million option modification charge during the three months ended March 31, 2022, as well as a $3.4 million increase in legal fees related to our ongoing YUTREPIA-related litigation.
Other Expenses totaled $1.5 million for the three months ended March 31, 2022, compared with $0.2 million for the three months ended March 31, 2021. The increase of $1.3 million was primarily due to a $1.0 million loss on extinguishment of debt related to the refinance of our long-term debt for the three months ended March 31, 2022.
Net loss for the three months ended March 31, 2022, was $15.9 million, or $0.30 per basic and diluted share, compared to a net loss of $9.2 million, or $0.21 per basic and diluted share, for the three months ended March 31, 2021.
Remodulin® (treprostinil) is a registered trademark of United Therapeutics Corporation.
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