Arcutis Announces First Quarter 2020 Financial Results and Provides Business Update
May 12 2020 - 4:05PM
Arcutis Biotherapeutics, Inc. (Nasdaq: ARQT), a late-stage
biopharmaceutical company focused on developing and commercializing
treatments for unmet needs in immune-mediated dermatological
diseases and conditions, or immuno-dermatology, today reported
financial results for the quarter ended March 31, 2020 and provided
a business update.
“Despite the global challenges presented by
COVID-19, Arcutis continued to make progress in executing upon our
mission of addressing the gap we see in dermatology drug
development by leveraging recent advances in inflammation and
immunology,” said Frank Watanabe, Arcutis’ President and Chief
Executive Officer. “Our priorities during these unprecedented times
are first and foremost to safeguard the health and well-being of
our trial participants, investigators, and employees; then to
continue effective operations to support our clinical trial sites
and to advance our pipeline of drug candidates; and to maintain the
financial strength and stability afforded us by our recent
successful initial public offering. Although some of our clinical
sites have experienced disruptions as a result of COVID-19, at this
time we do not expect delays to any of our previously disclosed
clinical timelines, and we still expect to have six clinical data
readouts over the next 18 months, including our pivotal Phase 3
clinical trials of topical roflumilast cream as a potential
treatment for plaque psoriasis. We currently have four product
candidates in development for seven indications, with an
addressable U.S. market of over 20 million patients.”
Pipeline UpdateTopical
roflumilast cream (ARQ-151) - a highly potent and
selective phosphodiesterase type 4 (PDE4) inhibitor in a cream
formulation, being developed as a potential treatment for plaque
psoriasis, including intertriginous psoriasis, and atopic
dermatitis.
- Arcutis initiated two Phase 3
clinical trials (DERMIS-1 and -2) evaluating the compound in plaque
psoriasis in January 2020, and anticipates announcing topline data
in the first half of 2021. At the request of the U.S. Food and Drug
Administration (FDA), in March the Company submitted a protocol
amendment to include children ages 2 to 11 years old in these
studies.
- In February, the Company announced
the enrollment of the first patient in a Phase 3 open label
extension study (DERMIS-OLE) of the compound in plaque
psoriasis.
- On-going Phase 2 long-term safety
study in plaque psoriasis has completed enrollment with topline
data anticipated in the first half of 2021.
- The Company expects to begin a
Phase 2b study in atopic dermatitis in the second half of 2020 with
topline data anticipated in the second half of 2021.
Topical roflumilast foam
(ARQ-154) - a highly potent and selective phosphodiesterase type 4
(PDE4) inhibitor in a foam formulation, designed to overcome the
challenges of delivering topical drugs in hair-bearing areas of the
body, being developed as a potential treatment for seborrheic
dermatitis and scalp psoriasis.
- Arcutis initiated a Phase 2
proof-of-concept study in seborrheic dermatitis in December 2019
and anticipates announcing topline data in the second half of
2020.
- The Company initiated a Phase 2b
study in scalp psoriasis in January 2020 with topline data
anticipated in the fourth quarter of 2020 or first quarter of
2021.
ARQ-252 - a potent and highly
selective topical small molecule inhibitor of janus kinase type 1
(JAK1), being developed as a potential treatment for chronic hand
eczema and other inflammatory dermatoses.
- Arcutis began enrollment in the
safety cohort of a Phase 1/2b study in chronic hand eczema in
April. Enrollment in the efficacy cohort of the study is
anticipated to begin in the second half of 2020, with topline data
expected in the second half of 2021.
- The Company anticipates initiating
a Phase 2a study in vitiligo in the second half of 2020.
ARQ-255 - an alternative
topical formulation of ARQ-252 designed to reach deeper into the
skin in order to potentially treat alopecia areata.
- Formulation and preclinical efforts are underway
Recent Corporate Highlights
- In February, the Company closed on
its Initial Public Offering, with net proceeds of approximately
$167.2 million.
- The Company appointed two
experienced biopharmaceutical leaders to its Board of Directors:
- Halley E. Gilbert, J.D.,
Director
- Joseph L. Turner, Director and
Audit Committee Chair
- Over the course of the first
quarter, the Company announced that three senior executives had
joined the Company:
- Patricia Turney, Senior Vice
President of Operations
- Heather Rowe Armstrong, Vice
President of Investor Relations and Corporate Communications.
- Kimberly Lathroum, Vice President
of Marketing
First Quarter 2020 Summary Financial
ResultsCash, cash equivalents and marketable
securities were $249.3 million as of March 31, 2020,
compared to $101.3 million as of December 31, 2019. Arcutis
believes that its current cash, cash equivalents and marketable
securities, will be sufficient to fund its operations through
2021.
Research and development (R&D)
expenses for the quarter ended March 31, 2020 were $25.2
million compared to $6.2 million for the corresponding period in
2019. The increase was primarily due to the initiation of
multiple clinical trials during the last year.
General and administrative (G&A)
expenses for the quarter ended March 31, 2020 were $3.5
million compared to $0.7 million for the corresponding period
in 2019. The increase was due to higher headcount and
professional services costs.
Net loss was $28.0 million, or
$1.15 per basic and diluted share, for the first quarter of 2020
compared to $6.7 million, or $4.08 per basic and diluted share, for
the first quarter of 2019.
About Arcutis - Bioscience,
applied to the skin.Arcutis is a late-stage biopharmaceutical
company focused on developing and commercializing treatments for
unmet needs in immune-mediated dermatological diseases and
conditions, or immuno-dermatology. Arcutis exploits recent
innovations in inflammation and immunology to develop potential
best-in-class therapies against validated biological targets,
leveraging our deep development, formulation and commercialization
expertise to bring to market novel dermatology treatments, while
maximizing our probability of technical success and financial
resources. Arcutis is currently developing three novel
compounds, including topical roflumilast cream (ARQ-151), topical
roflumilast foam (ARQ-154), and ARQ-252 for multiple indications,
including psoriasis, atopic dermatitis, seborrheic dermatitis, and
eczema. For more information, please visit www.arcutis.com or
follow the Company on LinkedIn.
Forward Looking
StatementsThis press release
contains "forward-looking" statements,
including, among others, statements regarding the
potential for its topical drugs in development to address large
markets with significant unmet need; expectations with regard to
the timing of data events anticipated during 2020/2021; and the
company’s belief that its current cash, cash equivalents and
marketable securities will be sufficient to
fund its operations through 2021. 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, 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-Q to be filed with U.S. Securities and Exchange Commission
(SEC) on May 12, 2020, 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.
Contact:Heather Rowe Armstrong Vice President,
Investor Relations & Corporate
Communicationsharmstrong@arcutis.com805-418-5006, Ext.
740
ARCUTIS BIOTHERAPEUTICS, INC.Condensed
Balance Sheets(In thousands, except share and par
value)
|
March 31, |
|
December 31, |
|
2020 |
|
2019 |
|
(unaudited) |
|
|
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
190,893 |
|
|
|
$ |
63,336 |
|
|
Marketable securities |
58,426 |
|
|
|
37,929 |
|
|
Prepaid expenses and other current assets |
4,559 |
|
|
|
5,209 |
|
|
Total current assets |
253,878 |
|
|
|
106,474 |
|
|
Property, plant, and equipment,
net |
241 |
|
|
|
227 |
|
|
Operating lease right-of-use
asset |
226 |
|
|
|
264 |
|
|
Other assets |
47 |
|
|
|
47 |
|
|
Total assets |
$ |
254,392 |
|
|
|
$ |
107,012 |
|
|
LIABILITIES, CONVERTIBLE
PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
4,759 |
|
|
|
$ |
1,405 |
|
|
Accrued liabilities |
7,281 |
|
|
|
3,654 |
|
|
Operating lease liability |
182 |
|
|
|
178 |
|
|
Total current liabilities |
12,222 |
|
|
|
5,237 |
|
|
Operating lease liability,
noncurrent |
82 |
|
|
|
129 |
|
|
Other long-term liabilities |
206 |
|
|
|
184 |
|
|
Total liabilities |
12,510 |
|
|
|
5,550 |
|
|
Convertible preferred stock, $0.0001 par value; no shares and
48,787,898 shares authorized at March 31, 2020 and
December 31, 2019, respectively; no shares and
24,385,388 shares issued and outstanding at March 31, 2020 and
December 31, 2019, respectively |
— |
|
|
|
166,491 |
|
|
Stockholders’ equity
(deficit): |
|
|
|
Preferred stock, $0.0001 par value; 10,000,000 and no shares
authorized at March 31, 2020 and December 31, 2019, respectively;
no shares issued and outstanding at March 31, 2020 and December 31,
2019; |
— |
|
|
|
— |
|
|
Common stock, $0.0001 par value; 300,000,000 and 65,820,000 shares
authorized at March 31, 2020 and December 31, 2019,
respectively; 38,154,550 and 2,879,763 shares issued at March 31,
2020 and December 31, 2019, respectively; 37,471,997 and
2,120,853 shares outstanding at March 31, 2020 and
December 31, 2019, respectively |
3 |
|
|
|
— |
|
|
Additional paid-in capital |
336,145 |
|
|
|
1,244 |
|
|
Accumulated other comprehensive income (loss) |
19 |
|
|
|
(1 |
) |
|
Accumulated deficit |
(94,285 |
) |
|
|
(66,272 |
) |
|
Total stockholders’ equity (deficit) |
241,882 |
|
|
|
(65,029 |
) |
|
Total liabilities, convertible
preferred stock and stockholders’ equity (deficit) |
$ |
254,392 |
|
|
|
$ |
107,012 |
|
|
|
|
|
|
ARCUTIS BIOTHERAPEUTICS,
INC. Condensed Statements of Operations and
Comprehensive Loss (In thousands, except
share and per share data)(unaudited)
|
Three Months Ended March 31, |
|
2020 |
|
2019 |
Operating expenses: |
|
|
|
Research and development |
$ |
25,182 |
|
|
|
$ |
6,203 |
|
|
General and administrative |
3,469 |
|
|
|
749 |
|
|
Total operating expenses |
28,651 |
|
|
|
6,952 |
|
|
Loss from operations |
(28,651 |
) |
|
|
(6,952 |
) |
|
Other income, net |
638 |
|
|
|
294 |
|
|
Net loss |
$ |
(28,013 |
) |
|
|
$ |
(6,658 |
) |
|
Per share information: |
|
|
|
Net loss per share, basic and
diluted |
$ |
(1.15 |
) |
|
|
$ |
(4.08 |
) |
|
Weighted-average shares used in
computing net loss per share, basic and diluted |
24,256,402 |
|
|
|
1,632,694 |
|
|
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