SAN DIEGO, June 30, 2016 /PRNewswire/ -- Arena
Pharmaceuticals, Inc. (NASDAQ: ARNA) today announced a strategic
shifting of priorities to emphasize its proprietary clinical stage
pipeline. The Company also announced the implementation of
additional cost reductions to streamline the organization to
support its development programs.
"We believe our clinical-stage pipeline has the potential to
deliver first or best-in-class compounds for a broad range of
indications. Building a streamlined and highly-focused organization
supports our primary objective – developing our pipeline in a
timely and efficient manner," said Amit
Munshi, Arena's President and Chief Executive Officer.
Arena will reduce its US workforce by approximately 100
employees, or 73%, primarily in areas of research, manufacturing
and G&A, which Arena estimates will reduce annualized cash
expenditures for (i) personnel by approximately $17 million and (ii) related other operating
expenses of between $6-8 million.
Arena plans to implement additional cost control measures to
further reduce its expenditures, including reductions at its Swiss
manufacturing facility.
As a result of the US workforce reduction, which is planned to
be completed by August 31, 2016,
Arena estimates it will incur restructuring charges, primarily in
the second quarter of 2016, of approximately $6.1 million (a majority of which are cash
expenditures) in connection with one-time employee termination
costs, including severance and other benefits.
Arena expects to discuss its strategic focus and organizational
streamlining during its upcoming second quarter conference
call.
About Arena Pharmaceuticals
We are a
biopharmaceutical company focused on discovering and developing
novel, small molecule drugs. We are currently directing our
activities and resources primarily on the following activities:
1. Advancing our proprietary clinical programs:
a. Etrasimod (APD334) – a
next generation, highly specific modulator of the sphingosine
1-phosphate subtype 1, or S1P1, receptor – in an ongoing
Phase 2 clinical trial for ulcerative colitis, and potentially
exploring additional indications, including beyond inflammatory
bowel disease
b. APD371– an agonist of the
cannabinoid-2, or CB2, receptor – most recently
completed a Phase 1 multiple-ascending dose clinical trial with
favorable results. and is under evaluation for pain indications
c. Ralinepag (APD811) – an
agonist of the prostacyclin receptor – in an ongoing Phase 2
clinical trial for pulmonary arterial hypertension, or PAH
2. Supporting our collaborations:
a. Eisai Inc. and Eisai Co.,
Ltd. and others – in their efforts with respect to the
approved product BELVIQ for weight management
b. Axovant Sciences Ltd. –
in Phase 2 clinical trials for nelotanserin, an inverse agonist of
the serotonin 2A receptor for central nervous system disorders
c. Ildong Pharmaceuticals
Co., Ltd. – in a Phase 1 clinical trial for temanogrel, an inverse
agonist of the serotonin 2A receptor for thrombotic diseases
d. Boehringer Ingelheim
International GmbH – in preclinical development of drug
candidates targeting a central nervous system, or CNS, receptor for
psychiatric diseases
For more information, please visit www.arenapharm.com
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 include
statements about the reduction of Arena's workforce, including the
expected size, timing, related charges and benefits, and other
expected impact of such reduction; Arena's focus, plans and
strategy; the advancement and potential of Arena's clinical
programs and collaborations; activities with Eisai and other
collaborators; implementing additional cost control measures; and
reducing expenditures and achieving savings. 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: the risk that the cost and
other negative effects related to the reduction of Arena's
workforce may be greater than anticipated; the risk that Arena may
not realize the benefits expected from the workforce reduction or
other cost control measures; risks related to developing and
commercializing drugs; the risk that we may need additional funds
to advance all of our programs, and you and others may not agree
with the manner we allocate our resources; cash and revenues
generated from BELVIQ, including the impact of competition; the
risk that 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; the timing and
outcome of regulatory review is uncertain, and lorcaserin may not
be approved for marketing in a different formulation or in any
other territory; regulatory decisions in one territory may impact
other regulatory decisions and Arena's business prospects;
government and commercial reimbursement and pricing decisions;
risks related to relying on collaborative arrangements; the timing
and receipt of payments and fees, if any, from collaborators; the
entry into or modification or termination of collaborative
arrangements; 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; data and other
information related to any of Arena's research and development may
not meet regulatory requirements or otherwise be sufficient for (or
Arena or a collaborator may not pursue) further research and
development, regulatory review or approval or continued marketing;
Arena's and third parties' intellectual property rights; the
timing, success and cost of Arena's research and development and
related strategy and decisions; results of clinical trials and
other studies are subject to different interpretations and may not
be predictive of future results; clinical trials and other studies
may not proceed at the time or in the manner expected or at all;
having adequate funds; and satisfactory resolution of litigation or
other disagreements with others. 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. 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.
Contact: Arena
Pharmaceuticals, Inc.
Kevin Lind
Chief Financial Officer
klind@arenapharm.com
858.453.7200
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www.arenapharm.com
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SOURCE Arena Pharmaceuticals, Inc.