Apellis Pharmaceuticals Reports Third Quarter 2019 Business Update and Financial Results
05 November 2019 - 11:30PM
Apellis Pharmaceuticals, Inc. (Nasdaq: APLS), a clinical-stage
biopharmaceutical company focused on the development of novel
therapeutic compounds to treat disease through the inhibition of
the complement system, today announced its third quarter 2019
financial results and business highlights.
“Apellis made continued clinical and business progress in the
third quarter of 2019, highlighted by dosing the first patient in
the Phase 3 PRINCE study for treatment-naïve patients with PNH and
significantly extending our cash runway through a convertible
senior notes offering,” said Cedric Francois, M.D., Ph.D.,
co-founder and chief executive officer of Apellis. “We look
forward to presenting preliminary data on APL-2 in C3
glomerulopathy at the American Society of Nephrology Kidney Week
later this week and releasing topline data from our Phase 3 PEGASUS
trial of APL-2 in patients with PNH in January 2020.”
Business Highlights and Upcoming
Milestones:
APL-2 in Systemic Indications
- In October 2019, Apellis announced it will present preliminary
clinical data on APL-2 (pegcetacoplan) in C3 glomerulopathy (C3G)
at the American Society of Nephrology Kidney Week 2019 in
Washington D.C. from Nov. 5-10. Data from eight patients in the C3G
cohort of the Phase 2 DISCOVERY trial of APL-2 will be presented
through study day 84 (12 weeks).
- In September 2019, Apellis announced the dosing of the first
patient in the Phase 3 clinical study, PRINCE (APL2-308),
evaluating the efficacy and safety of APL-2 for treatment-naïve
patients with PNH. The PRINCE study is a randomized, multicenter,
open-label, controlled study that aims to enroll 54 treatment-naïve
adult patients with PNH.
- Apellis met with regulatory authorities this fall to discuss
the program in cold agglutinin disease (CAD). The company will
update plans and timing for further clinical development of APL-2
for patients with CAD in early 2020.
APL-2 in Geographic Atrophy
- In September 2019, details about the company’s Phase 2 FILLY
study investigating intravitreal APL-2 for the treatment of
geographic atrophy (GA) secondary to age-related macular
degeneration were published in Ophthalmology, the journal of the
American Academy of Ophthalmology.
- Apellis continues to expect its two Phase 3 trials for APL-2 in
patients with GA will be fully enrolled by the end of the first
quarter of 2020.
Corporate & Other Highlights
- In September 2019, Apellis announced the closing of its
offering of $220.0 million aggregate principal amount of 3.500%
convertible senior notes due 2026. The notes are convertible into
cash, shares of Apellis common stock, or a combination of cash and
shares of Apellis common stock, at Apellis’ election.
Third Quarter 2019 Financial Results:
As of September 30, 2019, Apellis had $434.0 million in cash and
cash equivalents, compared to $176.3 million as of December 31,
2018. This includes approximately $212.9 million in net proceeds
raised in the offering of convertible senior notes in September
2019.
Apellis reported a net loss of $69.8 million for the third
quarter of 2019, compared to a net loss of $35.5 million for the
third quarter of 2018.
Research and development expenses were $51.3 million in the
third quarter of 2019, compared to $29.5 million for the same
period in 2018. The increase was primarily attributable to an
increase of $9.7 million in clinical trial costs, an increase of
$6.2 million in personnel-related costs primarily due to the hiring
of additional employees, an increase of $2.5 million in
manufacturing expenses, an increase of $2.2 million in pre-clinical
study expenses, and an increase of $1.3 million related to research
and development supporting activities, offset by a decrease of $0.1
million in device development expenses. The increases to research
and development expenses relate to the continued advancement of the
company’s clinical trial programs. Apellis expects its research and
development expenses to continue to increase as the number of
patients in its trials increases and the number of ongoing trials
increases.
General and administrative expenses were $18.6 million in the
third quarter of 2019, compared to $6.3 million for the same period
in 2018. The increase was primarily attributable to an increase in
employee-related costs of $6.0 million due to the hiring of
additional employees, an increase in professional and consulting
fees of $6.0 million, an increase in general office costs of $1.0
million and an increase of $0.2 million in insurance costs, offset
by a decrease of $0.7 million in license agreement costs and $0.2
million in director stock compensation expense.
About Apellis Apellis Pharmaceuticals, Inc. is
a clinical-stage biopharmaceutical company focused on the
development of novel therapeutic compounds for the treatment of a
broad range of life-threatening or debilitating autoimmune diseases
based upon complement immunotherapy through the inhibition of the
complement system at the level of C3. Apellis is the first company
to advance chronic therapy with a C3 inhibitor into clinical
trials. For additional information about Apellis and APL-2, please
visit http://www.apellis.com.
Forward-Looking Statements
Statements in this press release about future expectations, plans
and prospects, as well as any other statements regarding matters
that are not historical facts, may constitute “forward-looking
statements” within the meaning of The Private Securities Litigation
Reform Act of 1995. These statements include, but are not limited
to, statements relating to the implications of preliminary clinical
data. The words “anticipate,” “believe,” “continue,” “could,”
“estimate,” “expect,” “intend,” “may,” “plan,” “potential,”
“predict,” “project,” “should,” “target,” “will,” “would” and
similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
these identifying words. Actual results may differ materially from
those indicated by such forward-looking statements as a result of
various important factors, including: whether the Company’s
clinical trials will be fully enrolled and completed when
anticipated; whether preliminary or interim results from a clinical
trial will be predictive of the final results of the trial; whether
results obtained in preclinical studies and clinical trials will be
indicative of results that will be generated in future clinical
trials; whether APL-2 will successfully advance through the
clinical trial process on a timely basis, or at all; whether the
results of such clinical trials will warrant regulatory submissions
and whether APL-2 will receive approval from the FDA or equivalent
foreign regulatory agencies for GA, PNH, CAD or any other
indication; whether, if Apellis’ products receive approval, they
will be successfully distributed and marketed; and other factors
discussed in the “Risk Factors” section of Apellis’ Quarterly
Report on Form 10-Q filed with the Securities and Exchange
Commission on November 5, 2019 and the risks described in other
filings that Apellis may make with the Securities and Exchange
Commission. Any forward-looking statements contained in this press
release speak only as of the date hereof, and Apellis specifically
disclaims any obligation to update any forward-looking statement,
whether as a result of new information, future events or
otherwise.
APELLIS
PHARMACEUTICALS, INC. |
|
CONDENSED
CONSOLIDATED BALANCE SHEETS |
|
|
|
|
|
|
|
December 31, |
|
September 30, |
|
|
|
|
2018 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
Assets |
|
|
|
(Unaudited) |
|
Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
176,267,666 |
|
|
$ |
433,994,644 |
|
|
Prepaid assets |
|
|
24,333,851 |
|
|
|
14,742,698 |
|
|
Other current assets |
|
|
1,837,704 |
|
|
|
2,457,530 |
|
|
Total current assets |
|
|
202,439,221 |
|
|
|
451,194,872 |
|
|
Non-current
Assets: |
|
|
|
|
|
Right-of-use Assets |
|
|
— |
|
|
|
13,332,783 |
|
|
Property and equipment, net |
|
|
977,918 |
|
|
|
1,592,787 |
|
|
Other assets |
|
|
116,421 |
|
|
|
236,515 |
|
|
Total
assets |
|
$ |
203,533,559 |
|
|
$ |
466,356,957 |
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable |
|
$ |
10,254,938 |
|
|
$ |
11,836,609 |
|
|
Accrued expenses |
|
|
5,103,002 |
|
|
|
30,431,607 |
|
|
Current portion of long-term debt |
|
|
1,666,667 |
|
|
|
- |
|
|
Current portion of right of use liabilities |
|
|
— |
|
|
|
2,304,147 |
|
|
Total current liabilities |
|
|
17,024,607 |
|
|
|
44,572,363 |
|
|
Long-term
liabilities: |
|
|
|
|
|
Convertible senior notes |
|
|
— |
|
|
|
140,614,523 |
|
|
Development derivative liability |
|
|
— |
|
|
|
130,103,000 |
|
|
Term loan facility |
|
|
18,722,321 |
|
|
|
- |
|
|
Promissory note |
|
|
6,655,193 |
|
|
|
- |
|
|
Right-of-use liabilities |
|
|
— |
|
|
|
11,255,257 |
|
|
Other liabilities |
|
|
158,783 |
|
|
|
250,000 |
|
|
Total
liabilities |
|
|
42,560,904 |
|
|
|
326,795,143 |
|
|
Stockholders' equity: |
|
|
|
|
|
Preferred stock, $0.0001 par value; 10,000,000 shares authorized,
and zero shares issued and outstanding at December 31, 2018 and
September 30, 2019 |
|
|
— |
|
|
|
— |
|
|
Common stock, $0.0001 par value; 200,000,000 shares authorized at
December 31, 2018 and September 30, 2019 and 56,279,307 shares
issued and outstanding at December 31, 2018 and 63,872,762 shares
issued and outstanding at September 30, 2019 |
|
|
5,628 |
|
|
|
6,387 |
|
|
Additional paid in capital |
|
|
437,855,681 |
|
|
|
608,015,713 |
|
|
Accumulated other comprehensive loss |
|
|
(122,807 |
) |
|
|
(205,249 |
) |
|
Accumulated deficit |
|
|
(276,765,847 |
) |
|
|
(468,255,037 |
) |
|
Total stockholders' equity |
|
|
160,972,655 |
|
|
|
139,561,814 |
|
|
Total
liabilities and stockholders' equity |
|
$ |
203,533,559 |
|
|
$ |
466,356,957 |
|
|
|
|
|
|
|
|
APELLIS
PHARMACEUTICALS, INC. |
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS |
(Unaudited) |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
Operating
expenses: |
|
|
|
|
|
|
|
Research and development |
$ |
29,539,456 |
|
|
$ |
51,319,017 |
|
|
$ |
74,479,965 |
|
|
$ |
142,497,342 |
|
General and administrative |
|
6,265,125 |
|
|
|
18,628,945 |
|
|
|
16,248,203 |
|
|
|
39,577,627 |
|
Operating
loss |
|
(35,804,581 |
) |
|
|
(69,947,962 |
) |
|
|
(90,728,168 |
) |
|
|
(182,074,969 |
) |
Loss on
extinguishment of debt |
|
— |
|
|
|
(293,083 |
) |
|
|
— |
|
|
|
(1,501,215 |
) |
Loss from
remeasurement of development derivative liability |
|
— |
|
|
|
(263,000 |
) |
|
|
— |
|
|
|
(10,103,000 |
) |
Interest
income |
|
858,425 |
|
|
|
1,341,811 |
|
|
|
1,468,957 |
|
|
|
3,630,314 |
|
Interest
expense |
|
(577,534 |
) |
|
|
(601,377 |
) |
|
|
(1,270,743 |
) |
|
|
(1,354,379 |
) |
Other
(expense)/income, net |
|
(22,234 |
) |
|
|
(61,048 |
) |
|
|
(86,575 |
) |
|
|
(85,941 |
) |
Net
loss |
$ |
(35,545,924 |
) |
|
$ |
(69,824,659 |
) |
|
|
(90,616,529 |
) |
|
|
(191,489,190 |
) |
Other
comprehensive gain: |
|
|
|
|
|
|
|
Foreign currency gain |
|
(86,249 |
) |
|
|
(83,272 |
) |
|
|
(86,249 |
) |
|
|
(82,442 |
) |
Total other
comprehensive gain |
|
(86,249 |
) |
|
|
(83,272 |
) |
|
|
(86,249 |
) |
|
|
(82,442 |
) |
Comprehensive loss, net of tax |
$ |
(35,632,173 |
) |
|
$ |
(69,907,931 |
) |
|
$ |
(90,702,778 |
) |
|
$ |
(191,571,632 |
) |
Net loss per
common share, basic and diluted |
$ |
(0.64 |
) |
|
$ |
(1.10 |
) |
|
$ |
(1.69 |
) |
|
$ |
(2.79 |
) |
Weighted-average number of common shares used in net loss per
common share, basic and diluted |
|
56,201,299 |
|
|
|
63,752,719 |
|
|
|
53,770,400 |
|
|
|
68,737,045 |
|
|
|
|
|
|
|
|
|
Investor Contact:Sam Martin / Maghan
MeyersArgot Partners sam@argotpartners.com /
maghan@argotpartners.com212.600.1902
Media Contact: Tracy Vineis
tracy.vineis@apellis.com617.420.4839
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