[November 20, 2017] |
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Enanta Pharmaceuticals Reports Financial Results for its Fourth Quarter and Year Ended September 30, 2017
Enanta Pharmaceuticals, Inc. (NASDAQ:ENTA), a chemistry-driven
biotechnology company dedicated to creating and developing small
molecule drugs for viral infections and liver diseases, today reported
financial results for its fiscal fourth quarter and year ended September
30, 2017.
Enanta's cash, cash equivalents and short-term and long-term marketable
securities totaled $293.7 million at September 30, 2017. This compares
to a total of $242.2 million in such accounts at September 30, 2016.
Enanta expects that its current cash, cash equivalents and marketable
securities will be sufficient to meet the anticipated cash requirements
of its existing business and development programs for the foreseeable
future.
"Enanta has made great progress this past year and has delivered on
several key clinical and financial milestones," stated Jay R. Luly,
Ph.D., President and Chief Executive Officer of Enanta. "Enanta is on
track this quarter to earn the final regulatory milestone in our eleven
year HCV collaboration with AbbVie, which would mean we would have
successfully earned all clinical and regulatory milestones under the
collaboration. To date, this collaboration has provided us with a total
of approximately $500 million to fund and advance our internal pipeline.
With these resources, we expect to initiate two clinical studies by the
end of 2017: a Phase 2 study of our lead FXR agonist EDP-305 in PBC, and
a Phase 1 study of our direct-acting antiviral inhibitor EDP-938 for
RSV."
Fiscal Fourth Quarter and Year Ended September 30, 2017 Financial
Results
Total revenue for the three months ended September 30, 2017 was $75.9
million, compared to $12.8 million for the three months ended September
30, 2016. For the twelve months ended September 30, 2017, total revenue
was $102.8 million, compared to $88.3 million for the same period in
2016. The increase in revenue for the quarter was due to $65.0 million
in milestone payments for the U.S. and EU approvals of AbbVie's new HCV
regimen under the tradenames MAVYRET™ and MAVIRET™, respectively. For
the twelve months ending September 30, 2017, revenue also included $37.8
million in royalties earned on AbbVie's worldwide net sales of HCV
regimens containing paritaprevir or glecaprevir. For the 2016
twelve-month period, revenue consisted primarily of $57.7 million of
royalty revenues earned on AbbVie's worldwide net sales of HCV regimens
containing paritaprevir, as well as a $30.0 million milestone payment
for the reimbursement approval of one of those regimens, VIEKIRAX®, in
Japan in November 2015. Milestone payments and royalties have varied
significantly from period to period, and we expect that variability to
continue in the future.
Research and development expenses totaled $16.5 million for the three
months ended September 30, 2017, compared to $11.5 million for the three
months ended September 30, 2016. For the twelve months ended September
30, 2017, research and development expenses totaled $57.5 million
compared to $40.5 million for the same period in 2016. The increase in
research and development expenses in both periods was primarily due to
increased preclinical and clinical costs associated with the progression
of Enanta's wholly-owned R&D programs in non-alcoholic steatohepatitis
(NASH)/primary biliary cholangitis (PBC), respiratory syncytial virus
(RSV) and hepatitis B virus (HBV).
General and administrative expenses totaled $5.1 million for the three
months ended September 30, 2017, compared to $4.4 million for the three
months ended September 30, 2016. For the twelve months ended September
30, 2017, general and administrative expenses totaled $20.7 million,
compared to $17.0 million for the same period in 2016. For the
three-month period, the increase in general and administrative expenses
was primarily due to increases in compensation expense driven by
increased headcount. For the twelve-month period, the increase was due
to increased headcount as well as achievement of milestones under
existing performance-based equity awards.
Enanta recorded income tax expense of $18.4 million for the three months
ended September 30, 2017 compared to an income tax benefit of $0.8
million for the same period in 2016. Enanta recorded income tax expense
of $9.2 million for the year ended September 30, 2017 compared to income
tax expense of $10.9 million for the same period in 2016. The Company's
effective tax rate for fiscal 2017 was approximately 34%.
Net income for the three months ended September 30, 2017 was $36.5
million, or $1.86 per diluted common share, compared to a net loss of
$1.8 million, or $(0.09) per diluted common share, for the corresponding
period in 2016. For the twelve months ended September 30, 2017, net
income was $17.7 million, or $0.91 per diluted common share, compared to
net income of $21.7 million, or $1.13 per diluted common share, for the
corresponding period in 2016.
Development Program and Business Review
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On October 23, Enanta announced positive results from its Phase 1
clinical study of EDP-305, Enanta's lead FXR agonist for non-alcoholic
steatohepatitis (NASH) and primary biliary cholangitis (PBC). In this
study of single ascending doses (SAD) and multiple doses at ascending
dose levels per subject cohort (MAD), EDP-305 was generally safe and
well tolerated over a broad range of single and multiple doses with
pharmacokinetic (PK) data supporting once daily oral dosing. EDP-305
also exhibited strong engagement of the FXR receptor as evidenced by
increased FGF19 levels and reduced C4 levels. These results support
the ability to administer EDP-305 in future trials at doses that
neither elicited clinically significant changes in lipids nor resulted
in pruritus (itching).
-
Enanta expects to initiate two clinical studies by the end of 2017: a
Phase 2 clinical study of EDP-305 in patients with primary biliary
cholangitis (PBC) and a Phase 1 study of respiratory syncytial virus
(RSV) development candidate EDP-938 in healthy volunteers. A Phase 2
clinical study of EDP-305 in patients with NASH is expected to begin
in early 2018.
-
The U.S. Food and Drug Administration (FDA) has granted Enanta's drug
candidate EDP-305, an FXR agonist, Fast Track designation for the
treatment of patients with primary biliary cholangitis.
-
Bryan Goodwin, Ph.D., has recently joined Enanta as Vice President of
Biology. Dr. Goodwin will provide senior leadership to the virology
and NASH biology groups.
-
During the quarter, Enanta received milestone payments of $65.0
million for the U.S. and European approvals of AbbVie's new
MAVYRET™/MAVIRET™ (glecaprevir/pibrentasvir) regimen. Glecaprevir,
Enanta's second protease inhibitor product, is part of this new HCV
treatment regimen that will earn royalties for Enanta.
-
On September 27, Enanta announced that AbbVie also received approval
in Japan for MAVIRET™ (glecaprevir/pibrentasvir). Enanta will earn a
$15.0 million milestone payment from AbbVie upon price reimbursement
approval of MAVIRET™ in Japan, which is expected in the quarter ending
December 31, 2017.
Financial Guidance for Fiscal Year Ending September 30, 2018
-
Research and development expense between $90 million and $110 million
-
General and administration expense between $22 million and $28 million
Upcoming Events and Presentations
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36th Annual J.P. Morgan Healthcare Conference, January 7-11, 2018
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Enanta plans to issue its fiscal first quarter financial results press
release, and hold a conference call regarding those results, on
February 7, 2018.
Conference Call and Webcast Information Enanta will host a
conference call and webcast today at 4:30 p.m. ET. To participate in the
live conference call, please dial (855) 840-0595 in the U.S. or (518)
444-4814 for international callers. A replay of the conference call will
be available starting at approximately 7:30 p.m. ET on November 20,
2017, through 11:59 p.m. ET on November 23, 2017 by dialing (855)
859-2056 from the U.S. or (404) 537-3406 for international callers. The
passcode for both the live call and the replay is 6197609. A live audio
webcast of the call and replay can be accessed by visiting the "Events
and Presentation" section on the "Investors" page of Enanta's website at www.enanta.com.
About Enanta Enanta Pharmaceuticals has used its robust,
chemistry-driven approach and drug discovery capabilities to become a
leader in the discovery of small molecule drugs for the treatment of
viral infections and liver diseases. Two protease inhibitors,
paritaprevir and glecaprevir, discovered and developed through Enanta's
collaboration with AbbVie, have now been approved in jurisdictions
around the world as part of AbbVie's direct-acting antiviral (DAA)
regimens for the treatment of hepatitis C virus (HCV) infection,
including the U.S.-marketed regimens MAVYRET™ (glecaprevir/pibrentasvir)
and VIEKIRA PAK®
(paritaprevir/ritonavir/ombitasvir/dasabuvir).
Royalties and milestone payments from the AbbVie collaboration are
helping to fund Enanta's research and development efforts, which are
currently focused on the following disease targets: non-alcoholic
steatohepatitis (NASH)/ primary biliary cholangitis (PBC), respiratory
syncytial virus (RSV) and hepatitis B virus (HBV). Please visit www.enanta.com
for more information.
Forward Looking Statements This press release contains
forward-looking statements, including statements with respect to the
prospects for AbbVie's MAVYRET/MAVIRET regimen in HCV and the prospects
for advancement of Enanta's earlier stage programs in NASH/PBC and RSV,
as well as Enanta's projections of its expenses in 2018. Statements that
are not historical facts are based on management's current expectations,
estimates, forecasts and projections about Enanta's business and the
industry in which it operates and management's beliefs and assumptions.
The statements contained in this release are not guarantees of future
performance and involve certain risks, uncertainties and assumptions,
which are difficult to predict. Therefore, actual outcomes and results
may differ materially from what is expressed in such forward-looking
statements. Important factors and risks that may affect actual results
include: Enanta's revenues in the short-term are dependent upon the
success of AbbVie's continuing commercialization efforts for its HCV
treatment regimens containing paritaprevir and its new MAVYRET/MAVIRET
regimen; competitive pricing, market acceptance and reimbursement rates
for AbbVie's HCV treatment regimens compared to competitive HCV products
on the market; the discovery and development risks of early stage
discovery efforts in other disease areas such as NASH, PBC, RSV and HBV;
potential competition from the development efforts of others in those
other disease areas; Enanta's lack of clinical development experience;
Enanta's need to attract and retain senior management and key scientific
personnel; Enanta's need to obtain and maintain patent protection for
its product candidates and avoid potential infringement of the
intellectual property rights of others; and other risk factors described
or referred to in "Risk Factors" in Enanta's most recent Form 10-K for
the fiscal year ended September 30, 2016 and other periodic reports
filed more recently with the Securities and Exchange Commission. Enanta
cautions investors not to place undue reliance on the forward-looking
statements contained in this release. These statements speak only as of
the date of this release, and Enanta undertakes no obligation to update
or revise these statements, except as may be required by law.
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ENANTA PHARMACEUTICALS, INC. CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS UNAUDITED (in
thousands, except per share amounts)
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Three Months Ended September 30,
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Year Ended September 30,
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2017
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2016
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2017
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2016
|
|
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|
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Revenue
|
|
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$
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75,927
|
|
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$
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12,841
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|
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$
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102,814
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$
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88,268
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Operating expenses
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|
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|
|
|
|
|
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Research and development
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|
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16,514
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11,500
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57,451
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40,461
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General and administrative
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|
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5,118
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4,440
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20,749
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|
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16,966
|
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Total operating expenses
|
|
|
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21,632
|
|
|
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15,940
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|
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78,200
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57,427
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Income (loss) from operations
|
|
|
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54,295
|
|
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(3,099
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)
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|
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24,614
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30,841
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Other income, net
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|
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660
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|
|
471
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|
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2,333
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|
|
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1,719
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Income (loss) before income taxes
|
|
|
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54,955
|
|
|
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(2,628
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)
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|
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26,947
|
|
|
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32,560
|
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Income tax (expense) benefit
|
|
|
|
(18,447
|
)
|
|
|
826
|
|
|
|
(9,237
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)
|
|
|
(10,894
|
)
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Net income (loss)
|
|
|
$
|
36,508
|
|
|
$
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(1,802
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)
|
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$
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17,710
|
|
|
$
|
21,666
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|
|
|
|
|
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Net income (loss) per share
|
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Basic
|
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$
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1.91
|
|
|
$
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(0.09
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)
|
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$
|
0.93
|
|
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$
|
1.14
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Diluted
|
|
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$
|
1.86
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|
|
$
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(0.09
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)
|
|
$
|
0.91
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$
|
1.13
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Weighted average common shares outstanding
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Basic
|
|
|
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19,097
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|
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19,036
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19,066
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18,929
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Diluted
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19,611
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19,036
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19,407
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19,224
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ENANTA PHARMACEUTICALS, INC. CONDENSED CONSOLIDATED
BALANCE SHEETS UNAUDITED (in thousands)
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September 30, 2017
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September 30, 2016
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Assets
|
|
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Current assets
|
|
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Cash and cash equivalents
|
|
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$
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65,675
|
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$
|
16,577
|
Short-term marketable securities
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|
|
|
157,994
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|
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193,507
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Accounts receivable
|
|
|
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10,614
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|
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12,841
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Prepaid expenses and other current assets
|
|
|
|
3,536
|
|
|
9,231
|
Total current assets
|
|
|
|
237,819
|
|
|
232,156
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Property and equipment, net
|
|
|
|
8,049
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|
|
8,004
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Long-term marketable securities
|
|
|
|
70,038
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|
|
32,119
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Deferred tax assets
|
|
|
|
10,123
|
|
|
8,390
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Restricted cash
|
|
|
|
608
|
|
|
608
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Total assets
|
|
|
$
|
326,637
|
|
$
|
281,277
|
|
|
|
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|
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Liabilities and Stockholders' Equity
|
|
|
|
|
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Current liabilities
|
|
|
|
|
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Accounts payable
|
|
|
$
|
3,714
|
|
$
|
3,377
|
Accrued expenses and other current liabilities
|
|
|
|
7,970
|
|
|
4,512
|
Income taxes payable
|
|
|
|
9,298
|
|
|
-
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Total current liabilities
|
|
|
|
20,982
|
|
|
7,889
|
Warrant liability
|
|
|
|
807
|
|
|
1,251
|
Series 1 nonconvertible preferred stock
|
|
|
|
762
|
|
|
159
|
Other long-term liabilities
|
|
|
|
2,410
|
|
|
2,042
|
Total liabilities
|
|
|
|
24,961
|
|
|
11,341
|
Total stockholders' equity
|
|
|
|
301,676
|
|
|
269,936
|
Total liabilities and stockholders' equity
|
|
|
$
|
326,637
|
|
$
|
281,277
|
|
|
|
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