Applied Therapeutics Reports Second Quarter 2020 Financial Results
“The second quarter was an exciting time for the Company, as we continued to advance our late stage programs towards regulatory submission and commercial launch,” said
- Presented Data on AT-007 for Treatment of Galactosemia at the
Galactosemia Foundation2020 Virtual Conference. In July 2020, we presented data and provided an overview of the AT-007 Galactosemia development program at the Galactosemia Foundation2020 Virtual Conference, a unique platform that brings together patients and families with Galactosemia alongside researchers and physicians.
- Announced Start of AT-007 Pediatric Galactosemia Study; Released Additional 40mg/kg Data from Adult Galactosemia Study.
June 2020, we announced additional supportive biomarker efficacy and safety data for AT-007 in Galactosemia at 40 mg/kg. The data announced showed once-daily 40 mg/kg AT-007 resulted in plasma galactitol reduction of 55% and a rapid, sustained and statistically significant reduction in galactitol vs. placebo. 40mg/kg was safe and well-tolerated with no drug-related adverse events reported, and no compensatory increase in galactose or other metabolites, such as Gal-1p. We also announced initiation of the AT-007 pediatric trial, ACTION-Galactosemia Kids, in children age 2 to 17.
- Presented Data on AT-001 for the Treatment of Diabetic Cardiomyopathy at 2020
American Diabetes Association(ADA) Virtual Scientific Sessions. In June 2020, we presented data at the ADA80th Scientific Sessions. The presentations included comprehensive data on our aldose reductase inhibitor program and mechanistic data on the role of aldose reductase during hyperglycemia. The presentations included data on the structural basis and rational drug design behind our next generation aldose reductase inhibitors, as well as data elucidating the mechanisms by which AT-001 prevents cellular damage responsible for diabetic complications.
- Appointed Dr.
Chuck Silberstein, MD, MBA, CFA as Chief Financial Officer and Head of Business Development. In May 2020, we announced the appointment of Dr. Silberstein, formerly Senior Vice President of Corporate Business Development at Allergan plc, as Chief Financial Officer and Head of Business Development. Along with broad corporate strategy and business development skills, Dr. Silberstein brings more than 20 years of investment and capital markets experience to Applied Therapeutics.
- Cash and cash equivalents and short-term investments totaled
$138.5 millionas of June 30, 2020compared with $154.3 millionat March 31, 2020.
- Research and development expenses for the three months ended
June 30, 2020were $20.8 million, compared to $4.3 millionfor the three months ended June 30, 2019. For the three months ended June 30, 2020, the increase of $16.5 millionwas primarily due to an increase in clinical and pre-clinical expense of $7.5 million, primarily related to the progression of the AT-007 ACTION-Galactosemia, and the AT-001 Phase 3 ARISE-HF clinical studies, as well as the commencement of the ACTION-Galactosemia Kids pediatric registrational study; an increase in drug manufacturing and formulation costs of $9.2 millionprimarily related to the timing of raw material deliveries in support of the 2020 manufacturing campaigns and the completion and release of AT-001 and AT-007 drug product batches; an increase in personnel expenses of $0.2 milliondue to the increase in headcount in support of our clinical program pipeline; and an increase in regulatory and other expenses of $0.4 millionrelating to an increase in license fees during the three months ended June 30, 2020. This was partially offset by a decrease in stock-based compensation of $0.8 milliondue to the increased modification expense recognized during the three months ended June 30, 2019relating to the acceleration of certain options vesting following the IPO.
- General and administrative expenses General and administrative expenses were
$7.5 millionfor the three months ended June 30, 2020, compared to $4.2 millionfor the three months ended June 30, 2019. For the three months ended June 30, 2020, the increase of $3.3 millionwas primarily related to the increase in personnel expenses of $1.3 milliondue to the increase in headcount, $1.1 millionrelated to an increase in legal and professional fees due to increased costs associated with being a public company, $0.8 millionrelated to the establishment of a commercial department, $0.5 millionrelated to increased insurance costs, and $0.3 millionin other expenses relating to increased costs of rent and other office expenses. This was partially offset by the decrease of $0.7 millionin stock-based compensation expense, due to the additional modification expense recognized in April 2019for acceleration of certain options vesting following the IPO.
- Net loss for the second quarter of 2020 was
$28.1 million, or $1.27per basic and diluted common share, compared to a net loss of $ 8.4 million, or $ 0.60per basic and diluted common share, for the second quarter 2019.
This press release contains “forward-looking statements” that involve substantial risks and uncertainties for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. Any statements, other than statements of historical fact, included in this press release regarding strategy, future operations, prospects, plans and objectives of management, including words such as “may,” “will,” “expect,” “anticipate,” “plan,” “intend,” and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) are forward-looking statements. These include, without limitation, statements regarding (i) our plans to submit an NDA for potential approval of AT-007 around year-end 2020, which will also include data from the ACTION-Galactosemia Kids trial and the 90-day safety data in adults with Galactosemia, (ii) the design, scope and results of our clinical trials, (iii) the timing of the initiation and completion of our clinical trials, (iv) the likelihood that data from our clinical trials will support future development of our product candidates, and (v) the likelihood of obtaining regulatory approval of our product candidates and qualifying for any special designations, such as orphan drug designation. Forward-looking statements in this release involve substantial risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements, and we, therefore cannot assure you that our plans, intentions, expectations or strategies will be attained or achieved. Such risks and uncertainties include, without limitation, (i) our plans to develop and commercialize our product candidates, (ii) the initiation, timing, progress and results of our current and future preclinical studies and clinical trials and our research and development programs, (iii) our ability to take advantage of expedited regulatory pathways for any of our product candidates, (iv) our estimates regarding expenses, future revenue, capital requirements and needs for additional financing, (v) our ability to successfully acquire or license additional product candidates on reasonable terms, (vi) our ability to maintain and establish collaborations or obtain additional funding, (vii) our ability to obtain regulatory approval of our current and future product candidates, (viii) our expectations regarding the potential market size and the rate and degree of market acceptance of such product candidates, (ix) our ability to fund our working capital requirements and expectations regarding the sufficiency of our capital resources, (x) the implementation of our business model and strategic plans for our business and product candidates, (xi) our intellectual property position and the duration of our patent rights, (xii) developments or disputes concerning our intellectual property or other proprietary rights, (xiii) our expectations regarding government and third-party payor coverage and reimbursement, (xiv) our ability to compete in the markets we serve, (xv) the impact of government laws and regulations and liabilities thereunder, (xvi) developments relating to our competitors and our industry, (xvii) the impact of the COVID-19 pandemic on the timing and progress of our ongoing clinical trials and our business in general and (xviii) other factors that may impact our financial results. In light of the significant uncertainties in these forward-looking statements, you should not rely upon forward-looking statements as predictions of future events. Although we believe that we have a reasonable basis for each forward-looking statement contained in this press release, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur at all. Factors that may cause actual results to differ from those expressed or implied in the forward-looking statements in this press release are discussed in our filings with the U.S. Securities and Exchange Commission, including the “Risk Factors” contained therein. Except as otherwise required by law, we disclaim any intention or obligation to update or revise any forward-looking statements, which speak only as of the date they were made, whether as a result of new information, future events or circumstances or otherwise.
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Statements of Operations
(in thousands, except share and per share data)
|Three Months Ended||Six Months Ended|
|Research and development||$||20,758||$||4,254||$||28,028||$||11,128|
|General and administrative||7,522||4,183||12,725||6,037|
|Total operating expenses||28,280||8,437||40,753||17,165|
|LOSS FROM OPERATIONS||(28,280||)||(8,437||)||(40,753||)||(17,165||)|
|OTHER INCOME (EXPENSE), NET:|
|Interest income (expense), net||183||—||304||(1||)|
|Other income (expense)||38||—||21||—|
|Total other income (expense), net||221||—||325||(1||)|
|Net loss attributable to common stockholders—basic and diluted||$||(28,059||)||$||(8,437||)||$||(40,428||)||$||(17,166||)|
|Net loss per share attributable to common stockholders—basic and diluted||$||(1.27||)||$||(0.60||)||$||(1.88||)||$||(1.76||)|
|Weighted-average common stock outstanding—basic and diluted||22,062,030||13,945,939||21,451,344||9,776,582|
(in thousands, except share and per share data)
|As of||As of|
|Cash and cash equivalents||$||100,854||$||18,850|
|Prepaid expenses and other current assets||10,026||7,301|
|Total current assets||148,524||46,155|
|Operating lease right-of-use asset||1,849||2,035|
|Security deposits and leasehold improvements||199||199|
|LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)|
|Current portion of operating lease liabilities||372||356|
|Accrued expenses and other current liabilities||12,855||4,950|
|Total current liabilities||18,876||14,099|
|Noncurrent portion of operating lease liabilities||1,492||1,683|
|Total noncurrent liabilities||1,492||1,683|
|Additional paid-in capital||237,429||99,378|
|Accumulated other comprehensive loss||(29||)||(2||)|
|Total stockholders' equity||130,204||32,607|
|TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY||$||150,572||$||48,389|
Source: Applied Therapeutics