Kala Pharmaceuticals Reports First Quarter 2023 Financial Results and Provides Corporate Update
09 May 2023 - 10:00PM
Kala Pharmaceuticals, Inc. (NASDAQ:KALA), a clinical-stage
biopharmaceutical company dedicated to the research, development
and commercialization of innovative therapies for rare and severe
diseases of the eye, today reported financial results for the first
quarter ended March 31, 2023 and provided a corporate update.
“The first quarter and recent months were marked by a number of
important milestones across our business. We are particularly
encouraged by progress in our efforts to advance KPI-012 as the
first potential treatment to address all of the underlying
etiologies of PCED. We announced positive data from the initial
safety portion of the CHASE Phase 2b trial of KPI-012 for PCED,
enabling us to advance into the primary safety and efficacy portion
of the trial. The KPI-012 PCED program was also granted Fast Track
designation by the FDA, which further underscores the importance of
the program and the promise of KPI-012 as a novel solution for
thousands of PCED patients in need,” said Mark Iwicki, Chief
Executive Officer and Chairman of Kala Pharmaceuticals. “In
addition, we strengthened our corporate leadership with the
appointment of Dr. Francis Mah, an expert in both corneal disease
and clinical trial execution, as Chief Medical Advisor, and our
wholly-owned subsidiary, Combangio, Inc., was awarded a $15 million
grant from the California Institute for Regenerative Medicine
(CIRM). We believe the support from CIRM speaks to the potential of
KPI-012 – and our MSC-S platform more broadly – as a regenerative
approach to improve the treatment of rare ocular diseases. We look
forward to advancing the CHASE trial toward initial data readout
targeted in the first quarter of 2024, while exploring
opportunities to expand our MSC-S platform into additional
indications.”
First Quarter and Recent Business
Highlights:
Development-Stage Pipeline:KPI-012 is a
mesenchymal stem cell secretome (MSC-S), which combines growth
factors, protease inhibitors, matrix proteins and neurotrophic
factors to potentially correct the impaired corneal healing that is
an underlying etiology of multiple severe ocular diseases. Kala is
initially developing KPI-012 for the treatment of persistent
corneal epithelial defect (PCED), a persistent, non-healing corneal
defect or wound that is refractory to conventional treatments
which, if left untreated, can lead to significant complications,
including infection, corneal perforation/scarring and vision
loss.
- In April 2023, the U.S. Food and Drug Administration (FDA)
granted Fast Track designation for KPI-012 for the treatment of
PCED. Fast Track is a process designed by the FDA to facilitate the
development and expedite the review of drug candidates intended to
treat serious conditions and for which nonclinical and/or clinical
data demonstrate the potential to address unmet medical need. The
purpose of this designation is to help speed development and
regulatory review of new drugs, potentially making them available
to the patient more quickly.
- In March 2023, Kala announced positive data from the initial
safety portion of the CHASE (Corneal
Healing After
SEcretome therapy) Phase 2b clinical trial
evaluating KPI-012 for the treatment of PCED, which enrolled two
patients, both of whom were treated with a high dose of KPI-012 (3
U/mL) four times per day (QID). Both patients successfully
completed at least one week of dosing with no safety issues
observed.
- The CHASE trial is now enrolling the primary safety and
efficacy portion of the trial, which is a multicenter, randomized,
double-masked, vehicle-controlled, parallel-group study to evaluate
the safety and tolerability of two doses of KPI-012 ophthalmic
solution (3 U/mL and 1 U/mL) versus vehicle dosed topically QID for
56 days in approximately 90 patients. The primary endpoint of the
trial is the complete healing of the PCED as measured by corneal
fluorescein staining. Kala is targeting topline safety and efficacy
data in the first quarter of 2024. If the results are positive, and
subject to discussion with regulatory authorities, Kala believes
this trial could serve as the first of two pivotal trials required
to support the submission of a Biologics License Application (BLA)
to the FDA.
- Kala believes the multifactorial mechanism of action of KPI-012
makes it a platform technology and is evaluating the potential
development of KPI-012 for additional rare, front-of-the-eye
diseases, such as Limbal Stem Cell Deficiency and other corneal
diseases that threaten vision. Kala has also initiated preclinical
studies for its KPI-014 program, evaluating the utility of its
MSC-S platform for inherited retinal degenerative diseases such as
Retinitis Pigmentosa and Stargardt Disease.
Corporate Updates:
- In April 2023, the California Institute for Regenerative
Medicine (CIRM) awarded Combangio, Inc. (Combangio), a wholly-owned
subsidiary of Kala, a $15 million grant to support the ongoing
KPI-012 PCED program.
- In March 2023, Kala appointed Francis Mah, M.D., as Chief
Medical Advisor. In this newly established role, Dr. Mah provides
support for Kala’s clinical development and medical activities and
plays a key role in interactions with eye care professionals. Dr.
Mah is serving in this role on a part-time basis while continuing
his ongoing position as Director of Cornea and External Disease and
the Co-Director, Refractive Surgery at Scripps Clinic.
Financial Results:
Cash Position: As of March 31, 2023, Kala had
cash and cash equivalents of $63.6 million, compared to $70.5
million as of December 31, 2022. This decrease reflects cash used
in operations and a $2.5 million milestone payment to former
Combangio shareholders upon the dosing of the first patient in the
CHASE trial, as well as a prepayment of approximately $10 million
in principal and fees under the Company’s loan agreement, partially
offset by $14.9 million raised under Kala’s at-the-market offering
program. Cash and cash equivalents as of March 31, 2023 exclude
anticipated funding from the $15 million grant awarded by CIRM in
April 2023. Based on its current plans, Kala anticipates that its
cash resources as of March 31, 2023, together with anticipated
funding under the CIRM award, will enable it to fund operations
into the first quarter of 2025.
First Quarter 2023 Financial Results:
- Net Product Revenues: Kala did not recognize
product revenues in the first quarter of 2023, as a result of the
sale of its commercial portfolio to Alcon Inc. (Alcon) on July 8,
2022. For the quarter ended March 31, 2022, Kala reported net
product revenues of $1.4 million.
- Cost of Product Revenues: Kala did not record
cost of product revenues in the first quarter of 2023 as a result
of the sale of its commercial portfolio to Alcon. For the quarter
ended March 31, 2022, cost of product revenues was $0.8
million.
- SG&A Expenses: For the quarter ended March
31, 2023, selling, general and administrative (SG&A) expenses
were $6.0 million, compared to $27.0 million for the same period in
2022. The decrease was primarily due to the sale of Kala’s
commercial portfolio to Alcon.
- R&D Expenses: For the quarter ended March
31, 2023, research and development (R&D) expenses were $4.0
million, compared to $4.5 million for the same period in 2022. The
decrease was primarily due to a decrease in R&D costs related
to our former pipeline programs, partially offset by an increase in
costs due to the development of KPI-012.
- (Gain) Loss on Fair Value Remeasurement of Deferred
Purchase Consideration: For the quarter ended March 31,
2023, the gain on fair value remeasurement of deferred purchase
consideration, in connection with the Combangio acquisition, was
$0.2 million, compared to a loss of $1.1 million for the same
period in 2022.
- Loss (Gain) on Fair Value Remeasurement of Contingent
Consideration: For the quarter ended March 31, 2023, the
loss on fair value remeasurement of continent consideration, in
connection with the Combangio acquisition, was $1.8 million,
compared to a gain of $1.0 million for the same period in
2022.
- Operating Loss: For the quarter ended March
31, 2023, loss from operations was $11.7 million, compared to $30.9
million for the same period in 2022.
- Net Loss: For the quarter ended March 31,
2023, net loss was $14.5 million, or $6.99 per share, compared to a
net loss of $32.9 million, or $22.18 per share, for the same period
in 2022. The weighted average number of shares used to calculate
net loss per share was 2.1 million for the quarter ended March 31,
2023 and 1.5 million for the quarter ended March 31, 2022.
About Kala Pharmaceuticals, Inc.
Kala is a clinical-stage biopharmaceutical company dedicated to
the research, development and commercialization of innovative
therapies for rare and severe diseases of the eye. Kala’s
biologics-based investigational therapies utilize Kala’s
proprietary mesenchymal stem cell secretome (MSC-S) platform.
Kala’s lead product candidate, KPI-012, is a human MSC-S, which
contains numerous human-derived biofactors, such as growth factors,
protease inhibitors, matrix proteins and neurotrophic factors that
can potentially correct the impaired corneal healing that is an
underlying etiology of multiple severe ocular diseases. KPI-012 is
currently in clinical development for the treatment of persistent
corneal epithelial defect (PCED), a rare disease of impaired
corneal healing, for which it has received Orphan Drug and Fast
Track designations from the U.S. Food and Drug Administration. Kala
is also targeting the potential development of KPI-012 for the
treatment of Limbal Stem Cell Deficiency and other rare corneal
diseases that threaten vision and has initiated preclinical studies
to evaluate the potential utility of its MSC-S platform for retinal
degenerative diseases, such as Retinitis Pigmentosa and Stargardt
Disease. For more information on Kala, please visit
www.kalarx.com.
Forward Looking Statements:
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
that involve substantial risks and uncertainties. Any statements in
this press release about Kala’s future expectations, plans and
prospects, including but not limited to statements about KPI-012 as
the first potential treatment to address all underlying etiologies
of PCED; Kala’s expectations with respect to potential advantages
of KPI-012 and its MSC-S platform; the clinical utility of KPI-012
for PCED; anticipated timelines to report topline data for the
CHASE Phase 2b clinical trial of KPI-012; Kala’s belief that the
Chase Phase 2b trial could serve as the first of two pivotal trials
required to support the submission of a BLA to the FDA; Kala’s
plans to pursue research and development of KPI-012 and its MSC-S
platform for other indications; the amount of anticipated funding
under the CIRM award; the sufficiency of Kala’s existing cash
resources for the period anticipated; and other statements
containing the words “anticipate,” “believe,” “estimate,” “expect,”
“intend,” “may,” “plan,” “predict,” “project,” “target,”
“potential,” “likely,” “will,” “would,” “could,” “should,”
“continue,” and similar expressions constitute forward-looking
statements. Actual results may differ materially from those
indicated by such forward-looking statements as a result of various
important factors, including: Kala’s ability to comply with the
requirements under the CIRM award; uncertainties inherent in the
initiation and conduct of preclinical studies and clinical trials;
uncertainties regarding availability and timing of data from
clinical trials; whether results of early clinical trials or trials
in different disease indications will be indicative of the results
of ongoing or future trials; whether results of the Phase 1b
clinical trial of KPI-012 will be indicative of results for any
future clinical trials and studies of KPI-012, including the CHASE
Phase 2b clinical trial; whether interim data from a clinical trial
will be predictive of the results of the trial; uncertainties
associated with regulatory review of clinical trials and
applications for marketing approvals; Kala’s ability to retain and
hire key personnel; the impact of extraordinary external events,
such as the pandemic health event resulting from the coronavirus
(COVID-19), and their collateral consequences; the sufficiency of
cash resources and need for additional financing and other
important factors, any of which could cause Kala’s actual results
to differ from those contained in the forward-looking statements,
discussed in the “Risk Factors” section of Kala’s Quarterly Report
on Form 10-Q and other filings Kala makes with the Securities and
Exchange Commission. These forward-looking statements represent
Kala’s views as of the date of this press release and should not be
relied upon as representing Kala’s views as of any date subsequent
to the date hereof. Kala does not assume any obligation to update
any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
Financial Tables:
Kala Pharmaceuticals, Inc. |
Balance Sheet Data |
(in thousands) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, |
|
|
December 31, |
|
|
|
2023 |
|
|
2022 |
Cash and cash equivalents |
|
|
$ |
63,636 |
|
|
|
$ |
70,495 |
|
Total assets |
|
|
|
72,226 |
|
|
|
|
86,820 |
|
Working capital (1) |
|
|
|
61,079 |
|
|
|
|
60,257 |
|
Long-term debt, net of
discounts |
|
|
|
33,266 |
|
|
|
|
37,937 |
|
Other long-term
liabilities |
|
|
|
5,234 |
|
|
|
|
4,224 |
|
Total stockholders’
equity |
|
|
|
23,461 |
|
|
|
|
18,974 |
|
(1) The Company defines working capital as current assets less
current liabilities. See the Company's consolidated financial
statements for further information regarding its current assets and
current liabilities.
Kala Pharmaceuticals, Inc. |
Consolidated Statement of Operations |
(In thousands, except share and per share
data) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2023 |
|
2022 |
|
|
|
|
|
|
|
Product revenues, net |
|
$ |
— |
|
|
$ |
1,372 |
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
Cost of product revenues |
|
|
— |
|
|
|
775 |
|
Selling, general and administrative |
|
|
6,030 |
|
|
|
26,982 |
|
Research and development |
|
|
4,036 |
|
|
|
4,466 |
|
(Gain) loss on fair value remeasurement of deferred purchase
consideration |
|
|
(230 |
) |
|
|
1,051 |
|
Loss (gain) on fair value remeasurement of contingent
consideration |
|
|
1,847 |
|
|
|
(988 |
) |
Total operating expenses |
|
|
11,683 |
|
|
|
32,286 |
|
Loss from operations |
|
|
(11,683 |
) |
|
|
(30,914 |
) |
Other income (expense): |
|
|
|
|
|
|
Interest income |
|
|
675 |
|
|
|
8 |
|
Interest expense |
|
|
(1,474 |
) |
|
|
(2,035 |
) |
Other income (expense), net |
|
|
(1,973 |
) |
|
|
— |
|
Net loss |
|
|
(14,455 |
) |
|
|
(32,941 |
) |
Net loss per share
attributable to common stockholders—basic and diluted |
|
$ |
(6.99 |
) |
|
$ |
(22.18 |
) |
Weighted average shares
outstanding—basic and diluted |
|
|
2,069,186 |
|
|
|
1,485,168 |
|
Investor Contact:
Hannah Deresiewiczhannah.deresiewicz@sternir.com212-362-1200
KALA BIO (NASDAQ:KALA)
Historical Stock Chart
From Apr 2024 to May 2024
KALA BIO (NASDAQ:KALA)
Historical Stock Chart
From May 2023 to May 2024