Iterum Therapeutics plc (Nasdaq: ITRM) (“Iterum”), a clinical-stage
pharmaceutical company focused on developing next generation oral
and IV antibiotics to treat infections caused by multi-drug
resistant pathogens in both community and hospital settings, today
reported financial results for the third quarter ended September
30, 2022.
“We are thrilled to have the REASSURE clinical
trial underway,” said Corey Fishman, Chief Executive Officer. “We
are one step closer to potentially bringing oral sulopenem to
market as a viable treatment option for health care providers and
patients impacted by the lack of available antibiotics to fight
against growing bacterial resistance in infections found in the
community. We also continue to look forward and see utility in
developing sulopenem for the treatment of diseases beyond urinary
tract infections, particularly respiratory infections.”
Highlights and Recent Events
- Initiation of REASSURE
Clinical Trial: Iterum began enrollment in its
pivotal Phase 3 clinical trial, REASSURE (REnewed
ASsessment of Sulopenem in
uUTI caused by Resistant
Enterobacterales), for the treatment of
uncomplicated urinary tract infections (“uUTI”) in adult women in
October 2022. Enrollment is expected to be completed in the first
half of 2024. This trial is being conducted under a Special
Protocol Assessment (“SPA”) agreement with the U.S. Food and Drug
Administration (“FDA”). The SPA agreement provides that the design
and planned analysis of the trial, as set out in the protocol
submitted to the FDA, adequately addresses the objectives necessary
to support the potential resubmission of Iterum’s new drug
application (“NDA”) for oral sulopenem.
- U.S. Patent Issued Extending Protection: The
United States Patent and Trademark Office (“USPTO”) has issued
Iterum a new patent, No. US 11,478,428, directed to the composition
of the bilayer tablet of sulopenem etzadroxil and probenecid (“oral
sulopenem”) and its related uses. The U.S. patent is scheduled to
expire no earlier than 2039, absent any extensions. Existing patent
protection for sulopenem etzadroxil is scheduled to expire in 2029,
subject to potential extension. Iterum’s patent portfolio also
contains pending patent applications outside the U.S., including
Europe and China, submitted following receipt of the Written
Opinion of the International Search Authority indicating that
several claims directed to the composition of the bilayer tablet of
oral sulopenem are novel and inventive.
- Regained Compliance with NASDAQ Bid Price
Rule: On August 31, 2022, Iterum regained compliance with
the minimum bid price requirement under Nasdaq Listing Rule
5550(a)(2) (“Bid Price Rule”) for continued listing on The Nasdaq
Capital Market. In order to regain compliance with the Bid Price
Rule, on August 17, 2022, Iterum effected a 1-for-15 reverse share
split (“Reverse Share Split”) of its outstanding ordinary shares.
Accordingly, all authorized and issued and authorized and unissued
ordinary shares, 6.500% Exchangeable Senior Subordinated Notes due
2025 (“Exchangeable Notes”), share options, restricted share units,
warrants and shares reserved for future issuance under Iterum's
share plans have been adjusted in the Quarterly Report on Form 10-Q
filed with the Securities and Exchange Commission (the “SEC”) on
November 10, 2022 to reflect the Reverse Share Split for all prior
periods presented.
Third Quarter 2022 Financial
Results
Cash, cash equivalents and short-term investments
were $64.3 million at September 30, 2022. Based on the current
operating plan, Iterum expects that its current cash, cash
equivalents and short-term investments will be sufficient to fund
its operations into 2024, including through topline data from the
REASSURE clinical trial. As of October 31, 2022, Iterum had
approximately 12.2 million ordinary shares outstanding.
Research and development (“R&D”) expenses for
the third quarter of 2022 were $4.4 million compared to $1.8
million for the same period in 2021. The increase was primarily due
to an increase in costs incurred to support the activities for the
REASSURE clinical trial.
General and administrative (“G&A”) expenses
for the third quarter of 2022 were $2.7 million compared to $3.0
million for the same period in 2021. The decrease was primarily due
to lower share-based compensation expense, partially offset by an
increase in legal fees associated with the class action lawsuit
filed in August 2021.
Adjustments to the fair value of derivatives for
the third quarter of 2022 were $4.8 million compared to $9.8
million for the same period in 2021. The non-cash adjustment in the
third quarter of 2022 related to an increase in the fair value of
the Limited Recourse Royalty-Linked Subordinated Notes (the
“Royalty-Linked Notes”) due to the newly issued patent directed to
oral sulopenem to the composition of the bilayer tablet which
provides patent protection at least until 2039, partially offset by
a decrease in the value of the derivative components associated
with Iterum’s Exchangeable Notes, primarily as a result of a
decrease in the price of our ordinary shares and our market
capitalization during the period. The non-cash adjustment in the
third quarter of 2021 primarily related to a decrease in the value
of the derivative components associated with the Exchangeable Notes
as a result of a decrease in the price of its ordinary shares and
market capitalization during the period, partially offset by an
increase in the fair value of the Royalty-Linked Notes.
Cancellation of share options for the third
quarter of 2022 was $17.4 million and related to the non-cash
charge in connection with employee share options that were
surrendered and cancelled in July 2022.
Net loss for the third quarter of 2022 was $29.1
million compared to net income of $3.7 million for the same period
in 2021. Non-GAAP1 net loss was $5.3 million in the third quarter
of 2022 compared to the non-GAAP1 net loss of $3.7 million for the
same period in 2021.
Conference Call Details
Iterum will host a conference call today,
Thursday, November 10, 2022 at 8:30 a.m. Eastern Time. The dial-in
information for the call is as follows: United States: 1 844 200
6205; International: 1 929 526 1599; Access code: 819977
About Iterum Therapeutics plc
Iterum Therapeutics plc is a clinical-stage
pharmaceutical company dedicated to developing differentiated
anti-infectives aimed at combatting the global crisis of multi-drug
resistant pathogens to significantly improve the lives of people
affected by serious and life-threatening diseases around the world.
Iterum is currently advancing its first compound, sulopenem, a
novel penem anti-infective compound, in Phase 3 clinical
development with an oral formulation. Sulopenem also has an IV
formulation. Sulopenem has demonstrated potent in vitro activity
against a wide variety of gram-negative, gram-positive and
anaerobic bacteria resistant to other antibiotics. Iterum has
received Qualified Infectious Disease Product (“QIDP”) and Fast
Track designations for its oral and IV formulations of sulopenem in
seven indications. For more information, please
visit http://www.iterumtx.com.
Non-GAAP Financial Measures
To supplement Iterum’s financial results presented
in accordance with U.S. generally accepted accounting principles
(“GAAP”), Iterum presents non-GAAP net loss and non-GAAP net loss
per share to exclude from reported GAAP net (loss) / income and
GAAP net (loss) / income per share, intangible asset amortization
($0.4 million and $1.3 million); share-based compensation expense
($0.4 million and $4.3 million); the cancellation of share options
($17.4 million and $17.4 million); the interest expense associated
with accrued interest on the Exchangeable Notes, payable in cash,
shares or a combination of both upon exchange, redemption or at
January 31, 2025 (“the Maturity Date”), whichever is earlier ($0.2
million and $0.6 million); the non-cash amortization of the
Exchangeable Notes and Royalty-Linked Notes ($0.6 million and $1.8
million); and the non-cash adjustments to the fair value of
derivatives and Royalty-Linked Notes ($4.8 million and $2.5
million) for the three and nine months ended September 30, 2022,
respectively, and share-based compensation expense ($1.5 million
and $2.4 million); the interest expense associated with accrued
interest on the Exchangeable Notes payable in cash, shares or a
combination of both upon exchange, redemption or at the Maturity
Date, whichever is earlier ($0.2 million and $0.9 million); the
non-cash amortization of the Exchangeable Notes and Royalty-Linked
Notes ($0.6 million and $3.5 million); and the non-cash adjustments
to the fair value of derivatives and Royalty-Linked Notes ($9.8
million and $64.5 million) for the three and nine months ended
September 30, 2021, respectively.
Iterum believes that the presentation of non-GAAP
net loss and non-GAAP net loss per share, when viewed with its
results under GAAP and the accompanying reconciliation, provides
useful supplementary information to, and facilitates additional
analysis by, investors, analysts, and Iterum’s management in
assessing Iterum’s performance and results from period to period.
These non-GAAP financial measures closely align with the way
management measures and evaluates Iterum’s performance. These
non-GAAP financial measures should be considered in addition to,
and not a substitute for, or superior to, net (loss) / income or
other financial measures calculated in accordance with GAAP.
Non-GAAP net loss and non-GAAP net loss per share are not based on
any standardized methodology prescribed by GAAP and represents GAAP
net (loss) / income, which is the most directly comparable GAAP
measure, adjusted to exclude intangible asset amortization;
share-based compensation expense; the non-cash expense for the
cancellation of share options; the interest expense associated with
accrued interest on the Exchangeable Notes payable in cash, shares
or a combination of both upon exchange, redemption or at the
Maturity Date, whichever is earlier; the non-cash amortization of
the Exchangeable Notes and Royalty-Linked Notes; and the non-cash
adjustments to the fair value of derivatives and Royalty-Linked
Notes for the three and nine months ended September 30, 2022 and
September 30, 2021. Because of the non-standardized definitions of
non-GAAP financial measures, non-GAAP net loss and non-GAAP net
loss per share used by Iterum Therapeutics in this press release
and accompanying tables has limits in its usefulness to investors
and may be calculated differently from, and therefore may not be
directly comparable to, similarly titled measures used by other
companies. A reconciliation of non-GAAP net loss to GAAP net (loss)
/ income and non-GAAP net loss per share to GAAP net (loss) /
income per share have been provided in the tables included in this
press release.
Forward-Looking Statements
This press release contains forward-looking
statements. These forward-looking statements include, without
limitation, statements regarding Iterum’s plans, strategies and
prospects for its business, including the development, therapeutic
and market potential of sulopenem, the timing, conduct, progress
and results of Iterum’s ongoing REASSURE clinical trial, Iterum’s
expectations with regard to its ability to resolve the matters set
forth in the complete response letter (“CRL”) received by Iterum in
July 2021 and obtain approval for oral sulopenem, the expected
timing of resubmission of the NDA, the term and coverage provided
by Iterum’s patent and other intellectual property rights, and the
sufficiency of Iterum’s cash resources. In some cases,
forward-looking statements can be identified by words such as
“may,” “believes,” “intends,” “seeks,” “anticipates,” “plans,”
“estimates,” “expects,” “should,” “assumes,” “continues,” “could,”
“would,” “will,” “future,” “potential” or the negative of these or
similar terms and phrases. Forward-looking statements involve known
and unknown risks, uncertainties and other factors that may cause
Iterum’s actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. Forward-looking statements include all matters that are
not historical facts. Actual future results may be materially
different from what is expected due to factors largely outside
Iterum’s control, including uncertainties inherent in the design,
initiation and conduct of clinical and non-clinical development,
including the REASSURE clinical trial and the non-clinical
development being conducted in response to the CRL, availability
and timing of data from the REASSURE clinical trial and the
on-going non-clinical development, changes in regulatory
requirements or decisions of regulatory authorities, the timing or
likelihood of regulatory filings and approvals, including the
potential resubmission of the NDA for oral sulopenem, changes in
public policy or legislation, commercialization plans and
timelines, if oral sulopenem is approved, the actions of
third-party clinical research organizations, suppliers and
manufacturers, the accuracy of Iterum’s expectations regarding how
far into the future Iterum’s cash on hand will fund Iterum’s
ongoing operations, the impact of COVID-19 and related responsive
measures thereto, Iterum’s ability to maintain its listing on the
Nasdaq Capital Market, risks and uncertainties concerning the
outcome, impact, effects and results of Iterum’s evaluation of
corporate, strategic, financial and financing alternatives,
including the terms, timing, structure, value, benefits and costs
of any corporate, strategic, financial or financing alternative and
Iterum’s ability to complete one at all and other factors discussed
under the caption “Risk Factors” in its Quarterly Report on Form
10- Q filed with the SEC on November 10, 2022, and other documents
filed with the SEC from time to time. Forward-looking statements
represent Iterum’s beliefs and assumptions only as of the date of
this press release. Except as required by law, Iterum assumes no
obligation to update these forward-looking statements publicly, or
to update the reasons actual results could differ materially from
those anticipated in the forward-looking statements, even if new
information becomes available in the future.
Investor Contact: Judy Matthews
Chief Financial Officer 312-778-6073 IR@iterumtx.com
ITERUM
THERAPEUTICS PLC |
Condensed
Consolidated Statement of Operations |
(In
thousands except share and per share data) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September
30, |
|
September
30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Research and
development |
|
|
(4,353 |
) |
|
|
(1,845 |
) |
|
|
(11,777 |
) |
|
|
(7,010 |
) |
General and
administrative |
|
|
(2,681 |
) |
|
|
(3,029 |
) |
|
|
(10,680 |
) |
|
|
(10,698 |
) |
Total
operating expenses |
|
|
(7,034 |
) |
|
|
(4,874 |
) |
|
|
(22,457 |
) |
|
|
(17,708 |
) |
Operating
loss |
|
|
(7,034 |
) |
|
|
(4,874 |
) |
|
|
(22,457 |
) |
|
|
(17,708 |
) |
Interest
expense, net |
|
|
(636 |
) |
|
|
(849 |
) |
|
|
(2,441 |
) |
|
|
(4,781 |
) |
Adjustments
to fair value of derivatives |
|
|
(4,834 |
) |
|
|
9,783 |
|
|
|
2,498 |
|
|
|
(64,526 |
) |
Cancellation
of share options |
|
|
(17,350 |
) |
|
|
- |
|
|
|
(17,350 |
) |
|
|
- |
|
Other
income, net |
|
|
175 |
|
|
|
33 |
|
|
|
606 |
|
|
|
167 |
|
Income tax
expense |
|
|
570 |
|
|
|
(352 |
) |
|
|
(200 |
) |
|
|
(534 |
) |
Net (loss) /
income attributable to ordinary shareholders |
|
$ |
(29,109 |
) |
|
$ |
3,741 |
|
|
$ |
(39,344 |
) |
|
$ |
(87,382 |
) |
Net (loss) /
income per share attributable to ordinary shareholders – basic |
|
$ |
(2.38 |
) |
|
$ |
0.31 |
|
|
$ |
(3.22 |
) |
|
$ |
(8.40 |
) |
Net (loss) /
income per share attributable to ordinary shareholders –
diluted |
|
$ |
(2.38 |
) |
|
$ |
0.28 |
|
|
$ |
(3.22 |
) |
|
$ |
(8.40 |
) |
Weighted
average ordinary shares outstanding – basic |
|
|
12,233,374 |
|
|
|
12,182,002 |
|
|
|
12,217,188 |
|
|
|
10,403,889 |
|
Weighted
average ordinary shares outstanding – diluted |
|
|
12,233,374 |
|
|
|
13,483,807 |
|
|
|
12,217,188 |
|
|
|
10,403,889 |
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP net (loss) / income to non-GAAP net
loss |
|
|
|
|
|
|
|
|
Net (loss) /
income - GAAP |
|
$ |
(29,109 |
) |
|
$ |
3,741 |
|
|
$ |
(39,344 |
) |
|
$ |
(87,382 |
) |
Intangible
asset amortization |
|
|
429 |
|
|
|
— |
|
|
|
1,287 |
|
|
|
— |
|
Share based
compensation |
|
|
422 |
|
|
|
1,512 |
|
|
|
4,301 |
|
|
|
2,352 |
|
Cancellation
of share options |
|
|
17,350 |
|
|
|
- |
|
|
|
17,350 |
|
|
|
- |
|
Interest
expense - accrued interest and amortization on Exchangeable Notes
and Royalty-Linked Notes |
|
|
796 |
|
|
|
796 |
|
|
|
2,368 |
|
|
|
4,379 |
|
Adjustments
to fair value of derivatives |
|
|
4,834 |
|
|
|
(9,783 |
) |
|
|
(2,498 |
) |
|
|
64,526 |
|
Non-GAAP net
loss |
|
$ |
(5,278 |
) |
|
$ |
(3,734 |
) |
|
$ |
(16,536 |
) |
|
$ |
(16,125 |
) |
Net (loss) /
income per share attributable to ordinary shareholders – basic |
|
$ |
(2.38 |
) |
|
$ |
0.31 |
|
|
$ |
(3.22 |
) |
|
$ |
(8.40 |
) |
Net (loss) /
income per share attributable to ordinary shareholders –
diluted |
|
$ |
(2.38 |
) |
|
$ |
0.28 |
|
|
$ |
(3.22 |
) |
|
$ |
(8.40 |
) |
Non-GAAP net
loss per share attributable to ordinary shareholders – basic and
diluted |
|
$ |
(0.43 |
) |
|
$ |
(0.31 |
) |
|
$ |
(1.35 |
) |
|
$ |
(1.55 |
) |
|
|
|
|
|
|
|
|
|
ITERUM
THERAPEUTICS PLC |
|
|
|
|
Condensed
Consolidated Balance Sheet Data |
|
|
|
|
(In
thousands) |
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
of |
|
As
of |
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
|
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
Cash, cash
equivalents, restricted cash and short-term investments |
|
$ |
64,387 |
|
|
$ |
81,408 |
|
|
|
|
|
Other
assets |
|
|
7,168 |
|
|
|
10,101 |
|
|
|
|
|
Total assets |
|
$ |
71,555 |
|
|
$ |
91,509 |
|
|
|
|
|
Long-term
debt, less current portion |
|
$ |
9,298 |
|
|
$ |
6,930 |
|
|
|
|
|
Royalty-linked notes |
|
|
20,917 |
|
|
|
17,968 |
|
|
|
|
|
Derivative
liabilities |
|
|
610 |
|
|
|
6,058 |
|
|
|
|
|
Other
liabilities |
|
|
8,181 |
|
|
|
10,319 |
|
|
|
|
|
Total
liabilities |
|
|
39,006 |
|
|
|
41,275 |
|
|
|
|
|
Total
shareholders' equity |
|
|
32,549 |
|
|
|
50,234 |
|
|
|
|
|
Total liabilities and shareholders' equity |
|
$ |
71,555 |
|
|
$ |
91,509 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Reconciliations of applicable GAAP reported to non-GAAP
adjusted information are included at the end of this press
release
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