SAN DIEGO, May 7, 2020 /PRNewswire/ -- Arena
Pharmaceuticals, Inc. (Nasdaq: ARNA) today provided a corporate
update and reported financial results for the first quarter ended
March 31, 2020.
"We are pleased to announce that our ongoing clinical programs
are currently on track and our liquidity position remains strong
with approximately one billion
dollars in cash and investments. While maintaining momentum
has not been easy, and we – along with the rest of the industry –
have experienced a slowing in clinical trial operations, including
site activations, our teams have been actively monitoring our
ongoing trials day-by-day to ensure patient safety, study momentum
and conduct, and drug supply. Additionally, prior to the COVID-19
outbreak, our programs were well ahead of schedule, giving us an
important buffer to weather the storm. Finally, given the broad
clinical site base across our programs, we are also monitoring
certain countries and regions as they begin to lift restrictions.
We continue to evaluate the situation in real-time and we will
provide further updates frequently as circumstances evolve," said
Amit D. Munshi, President and CEO of
Arena.
Mr. Munshi added, "In the meantime, as we navigate the difficult
and uncertain global conditions, we are taking measures to slow
down hiring and spend in non-clinical areas, ensuring that we are
highly focused on our key clinical objectives. We continue to
judiciously manage cash and explore ways to reduce burn without
impacting the long-term value of Arena or the delivery of critical
milestones."
Financial Update
First Quarter 2020 Financial Results
- Revenues for the first quarter totaled $0.3 million compared to $801.1 million in the first quarter of 2019. This
decrease was driven by the $800.0
million upfront payment from the United Therapeutics
transaction in the first quarter of 2019
- Research and development (R&D) expenses for the first
quarter totaled $78.5 million
compared to $45.4 million in the same
period 2019. This increase was primarily driven by our advancing
clinical studies, including the etrasimod Phase 3 program, as well
as an increase in personnel expenses as we staff to support our
clinical programs. The R&D non-cash share-based compensation
was $6.6 million in the first quarter
as compared to $6.7 million in the
same period 2019
- General and administrative (G&A) expenses for the first
quarter totaled $26.4 million,
compared to $16.6 million in the
first quarter of 2019. This increase is primarily attributed to
personnel expenses including share-based compensation. The G&A
non-cash share-based compensation was $8.6
million in the first quarter as compared to $6.3 million in the same period 2019
- Net loss for the first quarter was $100.2 million compared to net income of
$620.1 million for the same period in
2019. In connection with the United Therapeutics transaction we
incurred transaction fees of approximately $17.0 million, of which $14.6 million was incurred in the first quarter
of 2019, and was presented as transaction costs in the condensed
consolidated statement of operations
- Basic and diluted net loss per share for the first quarter 2020
was $2.00 compared to basic net
income per share of $12.53 and
diluted net income per share of $12.11 for the same period in 2019
- Cash, cash equivalents and marketable securities were
$1.0 billion at March 31, 2020, as compared to $1.1 billion at December
31, 2019
Financial Outlook for 2020
Arena updated its 2020
financial guidance ranges:
- Cash used in operating activities for the full-year 2020 is
expected to be $400 million to
$430 million, down compared to our
previous guidance of $95 million in
the first quarter, with a subsequent quarter over quarter increase
in the high single-digits to low double-digits
Conference Call & Webcast Information
Arena will
host a live and webcast question and answer session via conference
call and live webcast with the investment community today,
Thursday, May 7, 2020, at
4:30 PM ET to discuss the financial
results and provide a corporate update.
When: Thursday, May 7, 2020, at
4:30 PM ET
Dial-in: (877) 643-7155 (United
States) or (914) 495-8552 (International)
Conference ID: 4171767
Please join the conference call at least 15 minutes early to
register. You can access the live webcast under the investor
relations section of Arena's website at: www.arenapharm.com. A
replay of the event will be archived under the investor relations
section of Arena's website for 30 days shortly after the call.
About Arena Pharmaceuticals
Arena
Pharmaceuticals is uniquely positioned to develop
best-in-disease medicines with optimized efficacy and safety for
patients globally. Our drive to deliver a robust pipeline of novel,
transformational medicines is grounded in two decades of
world-class G protein-coupled receptor (GPCR) discovery
research.
It is the breadth and depth of our portfolio, prioritization of
drug development to meet unmet patient needs, strong financial
health and growing, bold-thinking world-class team that gives Arena
the ingredients and passion to build a sustainable, vibrant
next-generation pharmaceutical company.
Etrasimod, olorinab and APD418 are investigational compounds
that are not approved for any use in any country.
Forward-Looking Statements
Certain statements in this
press release are forward-looking statements that involve a number
of risks and uncertainties. Such forward-looking statements may be
identified by words such as "expected," "ensure," "begin to,"
"will," "long-term," "outlook," "guidance," "uniquely positioned
to," and "drive to" and include, without limitation, statements
about the following: Arena's clinical programs, including clinical
study site activations, enrollment of study subjects, patient
safety, study momentum, drug supply, timing of data readouts, and
potential future updates on Arena's clinical programs; Arena's
financial outlook and guidance, including expectations regarding
cash to be used in operating activities and the rate of change
thereof; Arena's planned conference call and webcast with the
investment community; the potential of Arena's drug candidates,
including to be best-in-disease or transformational, have optimized
efficacy and safety, satisfy unmet patient needs, and be delivered
to patients globally; and Arena's position, drive, portfolio,
prioritization, financial position, team, and building of the
company. For such statements, Arena claims the protection of the
Private Securities Litigation Reform Act of 1995. Actual events or
results may differ materially from Arena's expectations. Factors
that could cause actual results to differ materially from the
forward-looking statements include, but are not limited to, the
following: clinical trials and other studies may not proceed at the
time or in the manner expected or at all; the timing and outcome of
research, development and regulatory review is uncertain, and
Arena's drug candidates may not advance in development or be
approved for marketing; enrolling patients in Arena's ongoing and
intended clinical trials is competitive and challenging; the
duration and severity of the recent coronavirus disease (COVID-19)
outbreak, including but not limited to the impact on Arena\'s
clinical operations, the operations of Arena's suppliers, partners,
collaborators, licensees, and capital markets, which in each case
remains uncertain; risks related to developing and commercializing
drugs; Arena may need additional funds to advance all of its
programs, and you and others may not agree with the manner Arena
allocates its resources; risks and uncertainties relating to cash
and revenues that may be generated from product sales or other
sources, including the impact of competition; Arena's revenues are
based in part on estimates, judgment and accounting policies, and
incorrect estimates or disagreement regarding estimates or
accounting policies may result in changes to Arena's guidance or
previously reported results; risks related to unexpected or
unfavorable new data; nonclinical and clinical data is voluminous
and detailed, and regulatory agencies may interpret or weigh the
importance of data differently and reach different conclusions than
Arena or others, request additional information, have additional
recommendations or change their guidance or requirements before or
after approval; results of clinical trials and other studies are
subject to different interpretations and may not be predictive of
future results; topline data may not accurately reflect the
complete results of a particular study or trial; satisfactory
resolution of litigation or other disagreements with others;
government and third-party payor actions, including relating to
reimbursement and pricing; risks related to relying on licenses or
collaborative arrangements, including lack of control and potential
disputes; the entry into or modification or termination of licenses
or collaborative arrangements; and Arena's and third parties'
intellectual property rights. Additional factors that could cause
actual results to differ materially from those stated or implied by
Arena's forward-looking statements are disclosed in Arena's filings
with the Securities and Exchange Commission (SEC), including but
not limited to Arena's Annual Report on Form 10-K for the year
ended December 31, 2019, which was
filed with the SEC on February 27,
2020. These forward-looking statements represent Arena's
judgment as of the time of this release. Arena disclaims any intent
or obligation to update these forward-looking statements, other
than as may be required under applicable law.
Corporate
Contact:
Megan E. Knight
Arena Pharmaceuticals, Inc.
Director, Investor Relations
mknight@arenapharm.com
858.210.3635
Arena Media Contact:
IR@arenapharm.com
858.453.7200
(Tables Follow)
Arena
Pharmaceuticals, Inc.
|
Condensed
Consolidated Statements of Operations
|
(In thousands, except
per share amounts)
|
|
|
|
Three months
ended
|
|
|
|
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
(unaudited)
|
|
Revenues
|
|
|
|
|
|
|
|
|
United Therapeutics
revenue
|
|
$
|
—
|
|
|
$
|
800,000
|
|
Royalty
revenue
|
|
|
262
|
|
|
|
973
|
|
Collaboration and
other revenue
|
|
|
—
|
|
|
|
84
|
|
Total
revenues
|
|
|
262
|
|
|
|
801,057
|
|
|
|
|
|
|
|
|
|
|
Operating Costs
& Expenses
|
|
|
|
|
|
|
|
|
Research &
development
|
|
|
78,533
|
|
|
|
45,396
|
|
General &
administrative
|
|
|
26,442
|
|
|
|
16,578
|
|
Transaction
costs
|
|
|
—
|
|
|
|
14,573
|
|
Total operating costs
& expenses
|
|
|
104,975
|
|
|
|
76,547
|
|
Income (loss) from
operations
|
|
|
(104,713)
|
|
|
|
724,510
|
|
|
|
|
|
|
|
|
|
|
Total interest &
other income (expense), net
|
|
|
4,506
|
|
|
|
5,957
|
|
Income (loss) before
income taxes
|
|
|
(100,207)
|
|
|
|
730,467
|
|
Income tax
provision
|
|
|
—
|
|
|
|
(110,333)
|
|
Net income
(loss)
|
|
$
|
(100,207)
|
|
|
$
|
620,134
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
per share, basic:
|
|
$
|
(2.00)
|
|
|
$
|
12.53
|
|
Net income (loss)
per share, diluted:
|
|
$
|
(2.00)
|
|
|
$
|
12.10
|
|
|
|
|
|
|
|
|
|
|
Shares used in
calculating net income (loss) per share, basic:
|
|
|
50,228
|
|
|
|
49,478
|
|
Shares used in
calculating net income (loss) per share, diluted:
|
|
|
50,228
|
|
|
|
51,255
|
|
Arena
Pharmaceuticals, Inc.
|
Condensed
Consolidated Balance Sheet Data
|
(In
thousands)
|
(Unaudited)
|
|
|
|
March 31, 2020
|
|
|
December 31, 2019
|
|
|
|
|
|
|
|
|
1
|
|
Assets
|
|
|
|
|
|
|
|
|
Cash & cash
equivalents
|
|
$
|
190,428
|
|
|
$
|
243,274
|
|
Accounts
receivable
|
|
|
268
|
|
|
|
1,654
|
|
Prepaid expenses &
other current assets
|
|
|
29,859
|
|
|
|
18,715
|
|
Total
available-for-sale investments
|
|
|
826,888
|
|
|
|
867,229
|
|
Land, property &
equipment, net
|
|
|
24,727
|
|
|
|
25,128
|
|
Other non-current
assets
|
|
|
17,501
|
|
|
|
18,123
|
|
Total
assets
|
|
$
|
1,089,671
|
|
|
$
|
1,174,123
|
|
|
|
|
|
|
|
|
|
|
Liabilities &
Stockholders' Equity
|
|
|
|
|
|
|
|
|
Accounts payable &
accrued liabilities
|
|
$
|
40,497
|
|
|
$
|
41,153
|
|
Total lease financing
obligations & other long-term liabilities
|
|
|
60,689
|
|
|
|
61,505
|
|
Total stockholders'
equity
|
|
|
988,485
|
|
|
|
1,071,465
|
|
Total liabilities
& stockholders' equity
|
|
$
|
1,089,671
|
|
|
$
|
1,174,123
|
|
|
|
1
|
The Condensed
Consolidated Balance Sheet Data has been derived from the audited
financial statements as of that date.
|
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SOURCE Arena Pharmaceuticals, Inc.