FALSE000178730600017873062024-02-272024-02-27

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________________
FORM 8-K
___________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 27, 2024
___________________________________________
ARCUTIS BIOTHERAPEUTICS, INC.
(Exact name of registrant as specified in its charter)
___________________________________________
Delaware
001-39186
81-2974255
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(IRS Employer
Identification Number)
3027 Townsgate Road, Suite300
Westlake Village, CA 91361
(Address of principal executive offices, including Zip Code)
Registrant’s telephone number, including area code: (805) 418-5006
___________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange
on which registered
Common Stock, par value $0.0001 per share
ARQT
The Nasdaq Global Select Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02    Results of Operations and Financial Condition.
On February 27, 2024, Arcutis Biotherapeutics, Inc. (the “Company” or “Arcutis”) issued a press release relating to its financial results for the quarter ended December 31, 2023. The full text of the press release is furnished herewith as Exhibit 99.1.
The information in this Item 2.02 of this Form 8-K and the Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, or incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01    Financial Statements and Exhibits
(d)    Exhibits.
Exhibit No.
Description
99.1
104Cover Page Interactive Data File (formatted as Inline XBRL).


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
ARCUTIS BIOTHERAPEUTICS, INC.
February 27, 2024
By:
/s/ John W. Smither
John W. Smither
Chief Financial Officer

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Arcutis Announces Fourth Quarter and Full Year 2023 Financial Results and Provides Business Update
•Q4 net product revenues for ZORYVE® (roflumilast) cream 0.3% were $13.5 million, a 357% increase compared to the fourth quarter of 2022 and a 67% increase compared to the third quarter of 2023; driven by sequential improvement in gross-to-net (GTN) in the mid 60 percent range, as well as sustained demand growth
•Received U.S. Food and Drug Administration (FDA) approval for ZORYVE® (roflumilast) topical foam, 0.3%, for the treatment of seborrheic dermatitis in adults and children down to age 9 in December 2023 and launched ZORYVE foam for seborrheic dermatitis in United States in late January 2024
•July 7, 2024 PDUFA action date for roflumilast cream, 0.15%, for the treatment of atopic dermatitis in adults and children down to age 6
•Strong financial position supports investment in plaque psoriasis and seborrheic dermatitis launches and continued development of pipeline
•2023 R&D expenses decreased 39% to $111 million, compared to 2022, and the Company expects continued reductions in R&D expenses in 2024 as it focuses investments in on-going ZORYVE commercial launches
Westlake Village, CA, February 27, 2024 – Arcutis Biotherapeutics, Inc. (Nasdaq: ARQT), a commercial-stage biopharmaceutical company focused on developing meaningful innovations in immuno-dermatology, today reported financial results for the quarter and year ended December 31, 2023, and provided a business update.
“2023 was a year of successful execution and builds a strong foundation for 2024. We are very encouraged by the strong revenue growth trend we are seeing, reinforcing the demand for new treatment options and physician adoption of ZORYVE,” said Frank Watanabe, president and chief executive officer. “With two FDA-approved products in the midst of their commercial launches and the mid-year PDUFA action date for roflumilast cream for atopic dermatitis, 2024 has the potential to be a transformational year for Arcutis. Our expanding product portfolio, combined with our robust development pipeline, seek to address unmet patient needs across multiple dermatology indications, and position Arcutis to accomplish our patient-centric mission of addressing unmet needs and the lack of innovation in medical dermatology.”
3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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Program Updates / Key Milestones
ZORYVE cream - a highly potent and selective phosphodiesterase-4 (PDE4) inhibitor in a once-daily cream formulation, approved in the United States and Canada for the treatment of plaque psoriasis and under development for atopic dermatitis
•Demand for ZORYVE cream in plaque psoriasis continues to grow, with over 165,000 prescriptions filled since launch to date by over 10,700 unique prescribers, reflecting the high levels of patient and physician satisfaction with the ZORYVE clinical profile. ZORYVE cream is covered by the three largest Pharmacy Benefit Managers. The Company saw significant GTN improvement in the fourth quarter compared to the GTN in the third quarter, and anticipates further GTN improvement in 2024. The FDA approved an expanded indication for ZORYVE cream for the treatment of plaque psoriasis in children down to age 6 in October 2023.
•The FDA has accepted the Company’s supplemental new drug application (sNDA) for roflumilast cream 0.15% for the treatment of atopic dermatitis (AD) in adults and children down to age 6. The FDA assigned the application a Prescription Drug User Fee Act (PDUFA) target action date of July 07, 2024. The sNDA is supported by positive results from three Phase 3 programs as well as a Phase 2 dose ranging study, and two Phase 1 pharmacokinetic studies.
3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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ZORYVE foam - a once-daily foam formulation of topical roflumilast designed to overcome the challenges of delivering topical drugs in hair-bearing areas of the body, approved in the United States for the treatment for seborrheic dermatitis and in development for scalp and body psoriasis
•In December 2023, the FDA approved the new drug application (NDA) for ZORYVE topical foam, 0.3%, for the treatment of seborrheic dermatitis in individuals 9 years of age and older. ZORYVE foam, the first drug approved for seborrheic dermatitis with a new mechanism of action in over two decades, provides rapid and robust disease clearance and significant reduction in itch, with nearly 80% of individuals achieving the primary efficacy endpoint of IGA Success and just over 50% of individuals reaching complete clearance at Week 8 in the STRATUM trial.
•In January 2024, Arcutis announced the acceptance of a new drug submission for roflumilast foam 0.3% for the treatment of adults and children down to age 9 by Health Canada.
•Based on the positive topline results from the ARRECTOR pivotal Phase 3 trial for the treatment of scalp and body psoriasis, the Company anticipates submitting an sNDA for scalp and body psoriasis to the FDA in the second half of 2024.
ARQ-255 - a topical suspension formulation of ivarmacitinib, a potent and highly selective topical Janus kinase type 1 (JAK1) inhibitor, designed to preferentially deliver the drug deep into the hair follicle, in order to potentially treat alopecia areata at the site of inflammation
•In December 2022, Arcutis announced the enrollment of the first healthy volunteer subject in a Phase 1b study in alopecia areata. The first subject in the alopecia areata cohort enrolled in the second quarter of 2023.
ARQ-234 - a fusion protein that is a potent and highly selective checkpoint agonist of the CD200 Receptor (CD200R), being developed as a potential biologic treatment in atopic dermatitis
•The Company continues preclinical development efforts.
3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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Recent Corporate Highlights 
•In October 2023, the United States Patent and Trademark Office awarded the Company a new formulation patent that covers a means for inhibiting roflumilast crystal growth, and is not limited to hexylene glycol. In November 2023, the Company was also awarded a new method of treatment patent with a topical roflumilast formulation with an extended half-life. Both patents do not expire until 2037.
•In October 2023, the Company completed a public offering raising gross proceeds of $102.3 million including the underwriters' 30-day option to purchase additional shares at the public offering price per share, which was partially exercised.
•In November 2023, the Company entered into an amendment of its loan agreement with SLR Investment Corp. (SLR), modifying the financial covenants on the existing drawn principal.

3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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Fourth Quarter and Full Year 2023 Summary Financial Results
Total revenues for the quarter ended December 31, 2023 were $13.5 million compared to $3.0 million for the corresponding period in 2022. Total revenues for the year ended December 31, 2023 were $59.6 million compared to $3.7 million for the corresponding period in 2022. These year-over-year increases were due to strong unit demand growth as well as improvements in gross-to-net sales deductions. In addition, the third quarter of 2023 included Other revenues of $30.4 million related to the upfront payment in connection with the Huadong collaboration and licensing agreement.
Cost of sales for the quarter ended December 31, 2023 were $2.2 million compared to $0.5 million for the corresponding period in 2022. Cost of sales for the year ended December 31, 2023 were $5.0 million compared to $0.8 million for the corresponding period in 2022.
Research and development (R&D) expenses for the quarter ended December 31, 2023 were $23.8 million compared to $33.9 million for the corresponding period in 2022. R&D expenses for the year ended December 31, 2023 were $110.6 million compared to $182.4 million for the corresponding period in 2022. These year-over-year decreases were due to decreased clinical development costs related to our topical roflumilast. In addition, R&D expenses for the third quarter of 2022 included approximately $30 million upfront expense for the Ducentis acquisition.
Selling, general, and administrative (SG&A) expenses for the quarter ended December 31, 2023 were $48.7 million compared to $37.0 million for the corresponding period in 2022. SG&A expenses for the year ended December 31, 2023 were $185.1 million compared to $122.1 million for the corresponding period in 2022. These year-over-year increases were primarily due to higher headcount and sales and marketing expenses related to the launch of ZORYVE.
Net loss was $66.3 million, or $0.72 per basic and diluted share, for the quarter ended December 31, 2023 compared to $72.0 million, or $1.18 per basic and diluted share, for the corresponding period in 2022. Net loss was $262.1 million, or $3.78 per basic and diluted share, for the year ended December 31, 2023 compared to $311.5 million, or $5.66 per basic and diluted share, for the corresponding period in 2022.
Cash, cash equivalents, restricted cash, and marketable securities were $272.8 million as of December 31, 2023, compared to $410.8 million as of December 31, 2022. Net cash used in operating activities was $56.2 during the fourth quarter and $247.1 million during the full year 2023.
3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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Conference Call and Webcast
Arcutis management will host a conference call and webcast today at 8:30 am ET to discuss the financial results for the quarter and year and provide a business update. The webcast for this conference call may be accessed at the “Events” section of the Company’s website. The replay of the webcast will be available on the Arcutis website following the call.
About Arcutis
Arcutis Biotherapeutics, Inc. (Nasdaq: ARQT) is a commercial-stage medical dermatology company that champions meaningful innovation to address the urgent needs of individuals living with immune-mediated dermatological diseases and conditions. With a commitment to solving the most persistent patient challenges in dermatology, Arcutis has a growing portfolio including two FDA approved products that harness our unique dermatology development platform coupled with our dermatology expertise to build differentiated therapies against biologically validated targets. Arcutis’ dermatology development platform includes a differentiated pipeline with multiple clinical programs for a range of inflammatory dermatological conditions including scalp and body psoriasis, atopic dermatitis, and alopecia areata. For more information, visit www.arcutis.com or follow Arcutis on LinkedIn, Facebook, and X.

3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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Forward Looking Statements
Arcutis cautions you that statements contained in this press release regarding matters that are not historical facts are forward-looking statements. These statements are based on the Company's current beliefs and expectations. Such forward-looking statements include, but are not limited to, statements regarding the potential for its topical drugs in development to address large markets with significant unmet need; the development, approval and potential commercialization of Arcutis' product candidates; the potential commercial success and growth of ZORYVE in plaque psoriasis and seborrheic dermatitis, including market access and reimbursement, product demand growth and continued improvement in gross to net; and the timing of regulatory filings and potential approvals for a number of dermatology indications for roflumilast in the United States and Canada. These statements involve substantial known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements and you should not place undue reliance on our forward-looking statements. Risks and uncertainties that may cause our actual results to differ include risks inherent in the clinical development process and regulatory approval process, the timing of regulatory filings, the timing, expenses, and success of our commercialization efforts, including uncertainty of future commercial sales and related items that can impact net sales, and our ability to defend our intellectual property. For a further description of the risks and uncertainties applicable to our business, see the “Risk Factors” section of our Form 10-K filed with U.S. Securities and Exchange Commission (SEC) on February 27, 2024, as well as any subsequent filings with the SEC. We undertake no obligation to revise or update information herein to reflect events or circumstances in the future, even if new information becomes available.

3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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Contacts:

Media
Amanda Sheldon, Head of Corporate Communications
asheldon@arcutis.com

Investors
Latha Vairavan, VP Finance and Investor Relations
lvairavan@arcutis.com

Derek Cole
Investor Relations Advisory Solutions
derek.cole@iradvisory.com

3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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ARCUTIS BIOTHERAPEUTICS, INC.
Condensed Consolidated Balance Sheets
(In thousands)
December 31,December 31,
20232022
ASSETS
Current assets:
Cash and cash equivalents
$88,398 $53,641 
Restricted cash925 1,234 
Marketable securities183,463 355,948 
Trade receivable, net25,807 8,458 
Inventories13,134 7,514 
Prepaid expenses and other current assets
18,704 10,611 
Total current assets
330,431 437,406 
Property and equipment, net1,539 1,881 
Intangible assets, net6,438 7,188 
Operating lease right-of-use asset
2,361 2,721 
Other assets
596 78 
Total assets
$341,365 $449,274 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$11,992 $8,827 
Accrued liabilities
33,941 28,323 
Operating lease liability
735 657 
Total current liabilities
46,668 37,807 
Operating lease liability, noncurrent
3,382 4,117 
Long-term debt, net201,799 197,769 
Other long-term liabilities
849 — 
Total liabilities
252,698 239,693 
Stockholders’ equity:
Common stock9 6 
Additional paid-in capital
1,070,558 930,425 
Accumulated other comprehensive loss4 (1,086)
Accumulated deficit
(981,904)(719,764)
Total stockholders’ equity88,667 209,581 
Total liabilities and stockholders’ equity$341,365 $449,274 
3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
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ARCUTIS BIOTHERAPEUTICS, INC.
Condensed Consolidated Statements of Operations
(In thousands, except share and per share data)

Three Months Ended December 31,Year Ended December 31,
2023202220232022
(unaudited)
Revenues:
Product revenue, net$13,526 $2,961 $29,186 $3,686 
Other revenue— — 30,420 — 
Total revenues13,526 2,961 59,606 3,686 
Operating expenses:
Cost of sales2,246 485 4,987 754 
Research and development23,775 33,877 110,575 182,435 
Selling, general, and administrative48,674 37,023 185,145 122,124 
Total operating expenses74,695 71,385 300,707 305,313 
Loss from operations(61,169)(68,424)(241,101)(301,627)
Other income (expense):
Other income, net2,672 3,320 11,786 5,821 
Interest expense(7,762)(6,915)(29,712)(15,652)
Loss before income taxes
(66,259)(72,019)(259,027)(311,458)
Provision for income taxes
$25 $— $3,113 $— 
Net loss$(66,284)$(72,019)$(262,140)$(311,458)
Per share information:
Net loss per share, basic and diluted$(0.72)$(1.18)$(3.78)$(5.66)
Weighted-average shares used in computing net loss per share, basic and diluted92,580,106 60,959,523 69,305,487 55,032,265 
3027 Townsgate Road, Suite 300 Westlake Village, CA 91361 | arcutis.com
v3.24.0.1
Cover
Feb. 27, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 27, 2024
Entity Registrant Name ARCUTIS BIOTHERAPEUTICS, INC.
Entity Incorporation, State or Country Code DE
Entity File Number 001-39186
Entity Tax Identification Number 81-2974255
Entity Address, Address Line One 3027 Townsgate Road
Entity Address, Address Line Two Suite300
Entity Address, City or Town Westlake Village
Entity Address, State or Province CA
Entity Address, Postal Zip Code 91361
City Area Code 805
Local Phone Number 418-5006
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.0001 per share
Trading Symbol ARQT
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001787306
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