Reata Pharmaceuticals, Inc. (Nasdaq: RETA) (“Reata,” the “Company,”
or “we”), a clinical-stage biopharmaceutical company, today
announced financial results for the fourth quarter and full year
ended December 31, 2019, and provided an update on the Company’s
business and product development programs.
“In 2019, we made significant progress toward
our goal of becoming a global, fully-integrated biopharmaceutical
company,” said Warren Huff, Reata’s Chief Executive Officer and
President. “We announced positive, pivotal data from our lead
franchises, chronic kidney disease (CKD) and neurology, and are
actively preparing for commercial launch in the United States and
abroad for bardoxolone methyl (bardoxolone) in CKD caused by Alport
syndrome, and omaveloxolone in Friedreich’s ataxia, two severe and
life-threatening diseases without approved therapies. We also
successfully capitalized the Company to fund the development of our
pipeline assets and advance our lead drug candidates and
early-stage drug candidates into new indications with high unmet
need.”
Reata 2019 Pipeline
Highlights
- Reported positive data from the
pivotal part 2 portion of the Phase 2 MOXIe study of omaveloxolone
in patients with Friedreich’s ataxia.
- Reported positive data from year
one of the pivotal Phase 3 portion of the CARDINAL study of
bardoxolone in patients with CKD caused by Alport syndrome.
- Launched the pivotal, global Phase
3 FALCON study of bardoxolone in patients with CKD caused by
autosomal dominant polycystic kidney disease (ADPKD).
- Completed enrollment in the pivotal
Phase 3 CATALYST study of bardoxolone in patients with connective
tissue disease-associated pulmonary arterial hypertension
(CTD-PAH).
Reata 2019 Corporate
Highlights
- Reacquired the development,
manufacturing, and commercialization rights concerning our
proprietary Nrf2 activator product platform, including bardoxolone
and omaveloxolone, originally licensed to AbbVie, Inc. (AbbVie) for
territories outside of the United States and excluding, for
bardoxolone, certain Asian countries previously licensed to Kyowa
Kirin Co., Ltd. (KKC).
- Completed an underwritten public
offering of 2,760,000 shares of Class A common stock at a price to
the public of $183.00 per share, resulting in gross proceeds of
$505 million.
Fourth Quarter Financial
Highlights
Cash and Cash Equivalents
At December 31, 2019, we had cash and cash
equivalents of $664.3 million, as compared to $337.8 million at
December 31, 2018.
GAAP and Non-GAAP Net Loss
The net loss according to generally accepted
accounting principles in the U.S. (GAAP) for the fourth quarter of
2019 was $186.9 million, or $5.91 per share, on both a basic and
diluted basis, as compared to a GAAP net loss of $25.6 million,
$0.86 per share, on both a basic and diluted basis, for the same
period of the year prior. For the twelve months ended December 31,
2019, the GAAP net loss was $290.2 million, or $9.54 per share, on
both a basic and diluted basis, as compared to a GAAP net loss of
$80.5 million, or $2.91 per share, on both a basic and diluted
basis, for the same period of the year prior.
The increase in GAAP net loss is driven
primarily by a Reacquired license right expense of $124.4 million
related to the amended and restated license agreement we entered
into with AbbVie in October 2019 (Reacquisition Agreement) to
reacquire the development, manufacturing, and commercialization
rights concerning our proprietary Nrf2 activator product platform,
as well as increases in stock based compensation expense related to
the growth of our personnel.
The non-GAAP net loss for the fourth quarter of
2019 was $50.3 million, or $1.59 per share on both a basic and
diluted basis, as compared to a non-GAAP net loss of $22.8 million,
$0.77 per share, on both a basic and diluted basis, for the same
period of the year prior. For the twelve months ended December 31,
2019, the non-GAAP net loss was $139.4 million, or $4.58 per share,
on both a basic and diluted basis, as compared to a non-GAAP net
loss of $70.0 million, or $2.53 per share, on both a basic and
diluted basis, for the same period of the year prior.
The non-GAAP net loss excludes stock-based
compensation and reacquired license rights expense. See “Use of
Non-GAAP Financial Measures” below for a description of non-GAAP
financial measures and a reconciliation between GAAP and non-GAAP
net loss appearing later in the press release.
Revenue
Revenue was $2.7 million in the fourth quarter
of 2019, as compared $8.5 million for the same period of the year
prior. Revenue for the fourth quarter of 2019 included $0.7 million
from the AbbVie collaboration agreement, $1.2 million from the KKC
license agreement, and $0.8 million from other sources. Revenue was
$26.5 million for the twelve months ended December 31, 2019, as
compared to $53.6 million, for the same period of the year prior.
Revenue for the twelve months ended December 31, 2019 included
$20.6 million from the AbbVie collaboration agreement, $4.7 million
from the KKC license agreement, and $1.2 million from other
sources.
GAAP and Non-GAAP Research and Development
(R&D) Expenses
GAAP R&D expenses were $40.2 million for the
fourth quarter of 2019, as compared to $25.3 million, for the same
period of the year prior. GAAP R&D expenses were $128.1 million
for the twelve months ended December 31, 2019, as compared to $97.3
million, for the same period of the year prior.
Non-GAAP R&D expenses were $36.7 million for
the fourth quarter of 2019, as compared to $24.3 million, for the
same period of the year prior. Non-GAAP R&D expenses were
$119.4 million for the twelve months ended December 31, 2019, as
compared to $93.3 million, for the same period of the year
prior.
The non-GAAP R&D expenses exclude
stock-based compensation expense. See “Use of Non-GAAP Financial
Measures” below for a description of non-GAAP financial measures
and a reconciliation between GAAP and non-GAAP R&D expenses
appearing later in the press release.
GAAP and Non-GAAP General and Administrative
(G&A) Expenses
GAAP G&A expenses were $22.3 million for the
fourth quarter of 2019, as compared to $7.9 million, for the same
period of the year prior. GAAP G&A expenses were $58.3 million
for the twelve months ended December 31, 2019, as compared to $32.7
million, for the same period of the year prior.
Non-GAAP G&A expenses were $13.4 million for
the fourth quarter of 2019, as compared to $6.2 million, for the
same period of the year prior. Non-GAAP G&A expenses were $40.6
million for the twelve months ended December 31, 2019, as compared
to $26.1 million, for the same period of the year prior.
The non-GAAP G&A expenses excludes
stock-based compensation expense. See “Use of Non-GAAP Financial
Measures” below for a description of non-GAAP financial measures
and a reconciliation between GAAP and non-GAAP G&A expenses
appearing later in the press release.
Operating Capital Requirements
We believe our existing cash and cash
equivalents will be sufficient to enable us to fund our operations
through the end of 2021.
Non-GAAP Financial Measures
This press release contains non-GAAP financial
measures, including non-GAAP R&D expenses, non-GAAP G&A
expenses, non-GAAP operating expenses, non-GAAP net loss and
non-GAAP net loss per common share – basic and diluted. These
measures are not in accordance with, or an alternative to, GAAP,
and may be different from non-GAAP financial measures used by other
companies.
The Company defines non-GAAP R&D expenses as
GAAP R&D expenses less stock-based compensation expense,
non-GAAP G&A expenses as GAAP G&A expenses less stock-based
compensation expense, non-GAAP operating expenses as GAAP operating
expenses less stock-based compensation expense and reacquired
license rights expense, non-GAAP net loss as GAAP net loss plus
stock-based compensation expense and reacquired license rights
expense and non-GAAP net loss per common share – basic and diluted
as GAAP net loss per common share – basic and diluted plus
stock-based compensation expense and reacquired license rights
expense. The Company has excluded the impact of stock-based
compensation expense, which may fluctuate from period to period
based on factors including the variability associated with
performance-based grants for stock options and restricted stock
units and changes in the Company’s stock price, which impacts the
fair value of these awards. The Company has excluded the impact of
reacquired license rights expense because the Company believes its
impact makes it difficult to compare its results to prior periods
and anticipated future periods.
Because management believes certain items such
as stock-based compensation expense and reacquired license rights
expense can distort the trends associated with the Company’s
ongoing performance, the following measures are often provided,
excluding special items, and utilized by the Company’s management,
analysts, and investors to enhance consistency and comparability of
year-over-year results, as well as to industry trends, and to
provide a basis for evaluating operating results in future periods:
non-GAAP net loss; non-GAAP net loss per common share – basic and
diluted; non-GAAP R&D expenses; non-GAAP G&A expenses; and
non-GAAP operating expenses.
The Company believes the presentation of these
non-GAAP financial measures provides useful information to
management and investors regarding the Company’s financial
condition and results of operations. When GAAP financial measures
are viewed in conjunction with these non-GAAP financial measures,
investors are provided with a more meaningful understanding of the
Company’s ongoing operating performance and are better able to
compare the Company’s performance between periods. In addition,
these non-GAAP financial measures are among those indicators the
Company uses as a basis for evaluating performance, allocating
resources and planning and forecasting future periods. These
non-GAAP financial measures are not intended to be considered in
isolation or as a substitute for GAAP financial measures. A
reconciliation between these non-GAAP measures and the most
directly comparable GAAP measures is provided later in this press
release.
|
CONFERENCE CALL INFORMATION |
Date: |
02/19/2020 |
Time: |
16:30 Eastern Time |
Audience Dial-in (toll-free): |
(844) 348-3946 |
Audience Dial-in (international): |
(213) 358-0892 |
Conference ID: |
1434037 |
Webcast Link: |
https://edge.media-server.com/mmc/p/jop4mn3n |
|
|
About Reata Pharmaceuticals,
Inc.
Reata is a clinical-stage biopharmaceutical
company that develops novel therapeutics for patients with serious
or life-threatening diseases by targeting molecular pathways
involved in the regulation of cellular metabolism and inflammation.
Reata’s two most advanced clinical candidates, bardoxolone and
omaveloxolone, target the important transcription factor Nrf2 that
promotes the resolution of inflammation by restoring mitochondrial
function, reducing oxidative stress, and inhibiting
pro-inflammatory signaling. Bardoxolone and omaveloxolone
are investigational drugs, and their safety and efficacy have not
been established by any agency.
Forward-Looking Statements
This press release includes certain disclosures
that contain “forward-looking statements,” including, without
limitation, statements regarding the success, cost and timing of
our product development activities and clinical trials, our plans
to research, develop and commercialize our product candidates, our
plans to submit regulatory filings, and our ability to obtain and
retain regulatory approval of our product candidates. You can
identify forward-looking statements because they contain words such
as “believes,” “will,” “may,” “aims,” “plans,” “model,” and
“expects.” Forward-looking statements are based on Reata’s
current expectations and assumptions. Because forward-looking
statements relate to the future, they are subject to inherent
uncertainties, risks, and changes in circumstances that may differ
materially from those contemplated by the forward-looking
statements, which are neither statements of historical fact nor
guarantees or assurances of future performance. Important
factors that could cause actual results to differ materially from
those in the forward-looking statements include, but are not
limited to, (i) the timing, costs, conduct, and outcome of our
clinical trials and future preclinical studies and clinical trials,
including the timing of the initiation and availability of data
from such trials; (ii) the timing and likelihood of regulatory
filings and approvals for our product candidates; (iii) whether
regulatory authorities determine that additional trials or data are
necessary in order to obtain approval; (iv) the potential market
size and the size of the patient populations for our product
candidates, if approved for commercial use, and the market
opportunities for our product candidates; and (v) other factors set
forth in Reata’s filings with the U.S. Securities and Exchange
Commission, including its Annual Report on Form 10-K, under the
caption “Risk Factors.” The forward-looking statements speak
only as of the date made and, other than as required by law, we
undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise.
Contact:Reata Pharmaceuticals, Inc.(972)
865-2219http://reatapharma.com
Investor Relations:Vinny JindalVice President,
Corporate Communications and Strategy(469)
374-8721ir@reatapharma.comhttps://reatapharma.com/contact-us/
Media:Matt Middleman, M.D.LifeSci Public
Relations(646)
627-8384matt.middleman@lifescipublicrelations.com
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Twelve Months Ended |
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Operations |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except share and per share
data) |
|
Collaboration revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
License and milestone |
|
$ |
1,840 |
|
|
$ |
7,898 |
|
|
$ |
25,276 |
|
|
$ |
52,351 |
|
Other revenue |
|
|
832 |
|
|
|
553 |
|
|
|
1,241 |
|
|
|
1,238 |
|
Total collaboration revenue |
|
|
2,672 |
|
|
|
8,451 |
|
|
|
26,517 |
|
|
|
53,589 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
40,161 |
|
|
|
25,308 |
|
|
|
128,109 |
|
|
|
97,288 |
|
Reacquired license rights |
|
|
124,398 |
|
|
|
- |
|
|
|
124,398 |
|
|
|
- |
|
General and administrative |
|
|
22,271 |
|
|
|
7,945 |
|
|
|
58,298 |
|
|
|
32,748 |
|
Depreciation |
|
|
273 |
|
|
|
120 |
|
|
|
932 |
|
|
|
431 |
|
Total expenses |
|
|
187,103 |
|
|
|
33,373 |
|
|
|
311,737 |
|
|
|
130,467 |
|
Other income (expense) |
|
|
(2,563 |
) |
|
|
(649 |
) |
|
|
(4,942 |
) |
|
|
(3,642 |
) |
Loss before taxes on income |
|
|
(186,994 |
) |
|
|
(25,571 |
) |
|
|
(290,162 |
) |
|
|
(80,520 |
) |
Provision for taxes on income |
|
|
(52 |
) |
|
|
11 |
|
|
|
8 |
|
|
|
26 |
|
Net loss |
|
$ |
(186,942 |
) |
|
$ |
(25,582 |
) |
|
$ |
(290,170 |
) |
|
$ |
(80,546 |
) |
Net loss per share—basic and diluted |
|
$ |
(5.91 |
) |
|
$ |
(0.86 |
) |
|
$ |
(9.54 |
) |
|
$ |
(2.91 |
) |
Weighted-average number of common shares used in net loss per
share basic and diluted |
|
|
31,630,810 |
|
|
|
29,716,666 |
|
|
|
30,414,203 |
|
|
|
27,701,783 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As ofDecember 31, |
|
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
(in
thousands) |
|
Condensed Consolidated Balance Sheet Data |
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
664,324 |
|
|
$ |
337,790 |
|
Working
capital |
|
|
477,262 |
|
|
|
286,353 |
|
Total
assets |
|
|
682,420 |
|
|
|
345,208 |
|
Term
loan, net of current portion and debt issuance costs |
|
|
155,017 |
|
|
|
79,219 |
|
Payable
to collaborators |
|
|
216,862 |
|
|
|
- |
|
Deferred
revenue (including current portion) |
|
|
9,389 |
|
|
|
225,721 |
|
Accumulated deficit |
|
|
(710,493 |
) |
|
|
(420,323 |
) |
Total stockholders’
equity (deficit) |
|
$ |
256,857 |
|
|
$ |
15,159 |
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to
Non-GAAP Financial Measures
The following table presents reconciliations of
non-GAAP financial measures to the most directly comparable GAAP
financial measures (in thousands, except for per share data)
(unaudited):
|
|
|
Three Months Ended |
|
|
Twelve Months Ended |
|
|
|
|
December 31, |
|
|
December 31, |
|
Reconciliation of GAAP to Non-GAAP Research and
development: |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
GAAP Research and development |
|
|
$ |
40,161 |
|
|
$ |
25,308 |
|
|
$ |
128,109 |
|
|
$ |
97,288 |
|
Less: Stock-based compensation expense |
|
|
|
(3,458 |
) |
|
|
(1,020 |
) |
|
|
(8,692 |
) |
|
|
(3,943 |
) |
Non-GAAP Research and development |
|
|
$ |
36,703 |
|
|
$ |
24,288 |
|
|
$ |
119,417 |
|
|
$ |
93,345 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP General and
administrative: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP General and administrative |
|
|
$ |
22,271 |
|
|
$ |
7,945 |
|
|
$ |
58,298 |
|
|
$ |
32,748 |
|
Less: Stock-based compensation expense |
|
|
|
(8,833 |
) |
|
|
(1,748 |
) |
|
|
(17,689 |
) |
|
|
(6,606 |
) |
Non-GAAP General and administrative |
|
|
$ |
13,438 |
|
|
$ |
6,197 |
|
|
$ |
40,609 |
|
|
$ |
26,142 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating expense |
|
|
$ |
187,103 |
|
|
$ |
33,373 |
|
|
$ |
311,737 |
|
|
$ |
130,467 |
|
Less: Stock-based compensation expense |
|
|
|
(12,291 |
) |
|
|
(2,768 |
) |
|
|
(26,381 |
) |
|
|
(10,550 |
) |
Less: Reacquired license rights(1) |
|
|
|
(124,398 |
) |
|
|
- |
|
|
|
(124,398 |
) |
|
|
- |
|
Non-GAAP Operating expense |
|
|
$ |
50,414 |
|
|
$ |
30,605 |
|
|
$ |
160,958 |
|
|
$ |
119,917 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP Net loss: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net loss |
|
|
$ |
(186,942 |
) |
|
$ |
(25,582 |
) |
|
$ |
(290,170 |
) |
|
$ |
(80,546 |
) |
Add: Stock-based compensation expense |
|
|
|
12,291 |
|
|
|
2,768 |
|
|
|
26,381 |
|
|
|
10,550 |
|
Add: Reacquired license rights(1) |
|
|
|
124,398 |
|
|
|
- |
|
|
|
124,398 |
|
|
|
- |
|
Non-GAAP Net loss |
|
|
$ |
(50,253 |
) |
|
$ |
(22,814 |
) |
|
$ |
(139,391 |
) |
|
$ |
(69,996 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP Net loss per common
share-basic and diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net loss per common share-basic and diluted |
|
|
$ |
(5.91 |
) |
|
$ |
(0.86 |
) |
|
$ |
(9.54 |
) |
|
$ |
(2.91 |
) |
Add: Stock-based compensation expense |
|
|
|
0.39 |
|
|
|
0.09 |
|
|
|
0.87 |
|
|
|
0.38 |
|
Add: Reacquired license rights(1) |
|
|
|
3.93 |
|
|
|
- |
|
|
|
4.09 |
|
|
|
- |
|
Non-GAAP Net loss per common share-basic and diluted |
|
|
$ |
(1.59 |
) |
|
$ |
(0.77 |
) |
|
$ |
(4.58 |
) |
|
$ |
(2.53 |
) |
(1) Charges incurred in connection with our reacquired license
right, which we do not expected to recur and are not considered in
our evaluation of ongoing operations.
Reata Pharmaceuticals (NASDAQ:RETA)
Historical Stock Chart
From Mar 2024 to Apr 2024
Reata Pharmaceuticals (NASDAQ:RETA)
Historical Stock Chart
From Apr 2023 to Apr 2024