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Curis Reports Second
Quarter 2008 Financial Results
CAMBRIDGE, MA, July 30, 2008 - Curis, Inc. (NASDAQ:CRIS), a drug development company focused on
seeking to develop next generation targeted small molecule drug candidates for cancer treatment, today reported its financial results for the second quarter ended June 30, 2008.
We are pleased with the progress of our programs to-date, including Genentech s recent initiation of Phase II clinical testing of GDC-0449 under our Hedgehog antagonist collaboration, said Dan
Passeri, Curis President and Chief Executive Officer. We also continued to advance our preclinical internally-developed drug candidates during the quarter, including filing an IND application for our lead candidate, CUDC-101. We expect
to treat our first patient in the CUDC-101 Phase I trial during the third quarter of 2008. In July, we announced that we selected CUDC-305, an orally available, synthetic small molecule inhibitor of heat shock protein 90, as a development candidate.
Pending the successful completion of IND-enabling studies, we expect to file an IND application for CUDC-305 in mid-2009.
For the second quarter of
2008, Curis reported a net loss of $2.0 million or ($0.03) per share, as compared to a net loss of $4.0 million or ($0.08) per share for the same period in the prior year.
Revenues for the second quarter of 2008 were $3.1 million as compared to $1.2 million for the second quarter of 2007, an increase of $1.9 million, or 158%. The increase in total revenues was primarily the result of an
increase in license fee revenues offset by a decrease in research funding revenues under collaborative arrangements as follows:
Operating expenses for the second quarter of 2008 were $5.3
million as compared to $5.4 million for the second quarter of 2007, a decrease of $100,000, or 2%. The primary changes in research and development and general and administrative expenses are as follows:
For the six-month period ending June 30, 2008, Curis reported a net loss of $5.4 million or ($0.09) per share, as compared to a net loss of $7.5 million or ($0.15)
per share for the same period in the prior year.
Revenues for the six months ended June 30, 2008 were $5.2 million as compared to $3.6 million for
the same period in 2007, an increase of $1.6 million, or 44%. The increase in revenues was primarily the result of an increase in license fee revenues related to the June 2003 Hedgehog antagonist collaboration with Genentech and the sale and
assignment of Curis remaining BMP assets to Stryker Corporation, offset by a decrease in research and development contracts revenues.
expenses were $11.2 million and $11.7 million for the six-month periods ended June 30, 2008 and 2007, respectively, a decrease of $500,000, or 4%. Research and development expenses were $6.7 million for the six months ended June 30, 2008
as compared to $6.3 million for the same period in the prior year, an increase of $400,000, or 6%. This increase was primarily related to increased spending on Curis targeted drug development programs, offset by reduced spending on other
research programs. General and administrative expenses were $4.5 million for the six months ended June 30, 2008 as compared to $5.3 million for the same period in the prior year, a decrease of $800,000, or 15%. This decrease was attributable to
decreases in stock based compensation, legal services related to the Company s patent portfolio and professional and consulting services offset by increased spending related to occupancy and travel costs.
As of June 30, 2008, Curis cash, cash equivalents, marketable securities and investments totaled $33.9 million and there were 63,430,160 shares of common
stock outstanding. The Company expects that its existing cash, cash equivalents and marketable securities should provide adequate capital to fund its currently-planned operations into the fourth quarter of 2009.
Second Quarter and Recent Highlights
Progress on clinical development of CUDC-101.
In May 2008, Curis filed an IND application for CUDC-101,
Curis lead drug candidate under internal development. CUDC-101 is designed as a first-in-class therapeutic to simultaneously inhibit three validated cancer targets: histone deacetylase (HDAC), epidermal growth factor receptor (EGFR) and human
epidermal growth factor receptor 2 (Her2). In preclinical studies, CUDC-101 inhibits all three molecular targets resulting in the potent killing of a wide range of cancer cell lines that are representative of a variety of human cancer types, many of
which have demonstrated resistance to various approved targeted agents.
Curis expects to treat its first patient with CUDC-101 during the third quarter of
2008. The phase I trial is designed as an open-label study of CUDC-101 in patients with advanced, refractory solid tumors. The primary objectives of the phase I trial are to evaluate the safety and tolerability of escalating doses of CUDC-101 and to
establish the maximum tolerated dose and dose-limiting toxicities. Secondary objectives will assess the pharmacokinetics, efficacy and ability of CUDC-101 to inhibit HDAC, EGFR and Her2 in this patient population. Curis plans to conduct the study at
two sites within the United States and expects to enroll between 18 and 40 patients across several dose-escalating cohorts. The successful completion of the phase I trial will be dependent upon, among other things, observed toxicities and whether
CUDC-101 achieves the phase I trial objectives.
CUDC-305 selected as a development candidate.
In July 2008, Curis selected CUDC-305, an orally available, synthetic small molecule inhibitor of heat shock protein 90 (Hsp90), as a development candidate. CUDC-305
demonstrated high potency in laboratory and preclinical testing across several cancer types, with tumor regression demonstrated in mouse xenograft models of acute myelogenous leukemia (AML), brain, breast, non-small cell lung and gastric cancers. To
date, the preclinical safety assessment for CUDC-305 appears favorable and Curis expects to initiate IND-enabling studies shortly. Should such further testing be favorable, Curis anticipates that it will file an IND application for CUDC-305 in
Progress on clinical development of Hedgehog antagonist GDC-0449 with collaborator Genentech.
In May 2008, Genentech initiated a phase II clinical trial of GDC-0449 in first-line metastatic colorectal cancer. The study is designed to evaluate GDC-0449 in
approximately 150 patients with metastatic colorectal cancer in combination with the current standard of care as first-line therapy in a randomized, placebo-controlled, double-blind phase II trial. Patients will receive either FOLFOX or FOLFIRI
chemotherapy regimens in combination with bevacizumab and will be randomized to receive GDC-0449 or placebo. The primary objective of the phase II clinical trial is progression-free survival from randomization to disease progression or death.
Secondary outcome measures include the measurement of Hedgehog protein expression in archival tissue and tracking of adverse events.
Genentech has also indicated that it plans to initiate additional phase II clinical trials of GDC-0449 in advanced
ovarian cancer and that it expects this trial to begin during the second half of 2008. If Genentech initiates the ovarian cancer trial as it has indicated, Genentech is obligated to make a $3 million cash payment to Curis within 30 days thereafter.
Genentech has also stated that it plans to initiate a phase II trial in advanced basal cell carcinoma during the second half of 2008.
Data presented from Phase I study of GDC-0449 at ASCO.
June 1, 2008, Dr. Patricia LoRusso, a phase I clinical investigator, presented select phase I clinical data of GDC-0449, including full toxicity data, at the American Society of Clinical Oncologists (ASCO) Annual Meeting. Dr. LoRusso
reported that GDC-0449 demonstrated a favorable pharmacokinetic and pharmacodynamic profile with high sustained plasma concentrations and a prolonged terminal half-life of greater than seven days. No dose-limiting adverse events occurred. Gli1, a
biomarker of Hedgehog signaling activity, was down modulated greater than 2-fold in skin biopsies from 11 of 14 patients analyzed.
presented from Phase I study of GDC-0449 at AACR.
In April 2008, at the American Association for Cancer Research Annual Meeting, Daniel D. Von Hoff,
M.D., an investigator of the GDC-0449 phase I clinical trial, presented data from nine patients treated with GDC-0449 with locally advanced, multifocal and metastatic basal cell carcinoma. In five patients with metastatic basal cell carcinoma to the
lungs, two patients had confirmed RECIST partial responses, two had ongoing stable disease and one had progressive disease. In four patients with clinically evaluable, locally advanced or multi-focal basal cell carcinoma, two patients exhibited
complete response in subcutaneous masses by physical exam and two patients had improvement in skin lesions. Gli-1, a biomarker for Hedgehog signaling activity, was reduced in all evaluated patients. No significant toxicities were observed with
GDC-0449 and no dose limiting toxicities were reached in the phase I clinical trial. Some patients experienced a loss of sense of taste, and there was a small amount of hair and weight loss.
Conference Call Information
Curis will hold a conference call today,
July 30, 2008, at 9:00 A.M. EDT, to discuss (i) its Hedgehog antagonist program under collaboration with Genentech, (ii) CUDC-101 and other proprietary targeted cancer programs, (iii) its financial results as of and for the
three- and six-month periods ended June 30, 2008, and (iv) additional corporate activities. Daniel Passeri, President and Chief Executive Officer of Curis, will host the call.
To access the live conference call, please call (866) 356-4123 from the United States or Canada or (617) 597-5393 from other locations, shortly before 9:00 A.M. EDT. The conference ID number is 42440244. The
conference call can also be accessed on the Curis website at www.curis.com in the Investors section. A replay will be available approximately two hours after the completion of the call and through 5:00 P.M. EDT, Wednesday, August 13,
2008. To access the replay, please call (888) 286-8010 from the United States or Canada or (617) 801-6888 from other locations and reference the conference ID number 84085781.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| Three months ended | Six months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Revenues | $ | 3,107,810 | $ | 1,228,724 | $ | 5,175,393 | $ | 3,591,510 | ||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 3,200,683 | 3,046,824 | 6,676,495 | 6,342,439 | ||||||||||||
| General and administrative | 2,124,809 | 2,359,186 | 4,540,303 | 5,310,771 | ||||||||||||
| Total operating expenses | 5,325,492 | 5,406,010 | 11,216,798 | 11,653,210 | ||||||||||||
| Net loss from operations | (2,217,682 | ) | (4,177,286 | ) | (6,041,405 | ) | (8,061,700 | ) | ||||||||
| Other income, net | 253,126 | 179,742 | 646,182 | 523,383 | ||||||||||||
| Net loss | $ | (1,964,556 | ) | $ | (3,997,544 | ) | $ | (5,395,223 | ) | $ | (7,538,317 | ) | ||||
| Basic and diluted net loss per common share | $ | (0.03 | ) | $ | (0.08 | ) | $ | (0.09 | ) | $ | (0.15 | ) | ||||
| Basic and diluted weighted average common shares outstanding | 63,337,647 | 49,408,100 | 63,291,592 | 49,381,508 |
CONDENSED CONSOLIDATED BALANCE SHEETS
| June 30, 2008 | December 31, 2007 | |||||
| ASSETS | ||||||
| Cash, cash equivalents and marketable securities | $ | 33,914,399 | $ | 41,459,176 | ||
| Long-term investments restricted | 210,007 | 210,007 | ||||
| Accounts receivable | 209,514 | 230,467 | ||||
| Property and equipment, net | 2,117,262 | 2,577,602 | ||||
| Goodwill | 8,982,000 | 8,982,000 | ||||
| Other assets | 198,054 | 357,433 | ||||
| Total assets | $ | 45,631,236 | $ | 53,816,685 | ||
| LIABILITIES AND STOCKHOLDERS EQUITY | ||||||
| Accounts payable, accrued expenses and other liabilities | $ | 2,813,284 | $ | 4,715,772 | ||
| Debt obligations | 403,832 | |||||
| Deferred revenue | 1,852,518 | |||||
| Total liabilities | 2,813,284 | 6,972,122 | ||||
| Total stockholders equity | 42,817,952 | 46,844,563 | ||||
| Total liabilities and stockholders equity | $ | 45,631,236 | $ | 53,816,685 |
Curis is a drug development company that is committed to leveraging its innovative signaling pathway drug technologies to seek to create new medicines, primarily for cancer. In expanding its drug development efforts in the field of cancer
through its targeted cancer drug development platform, Curis is building upon its previous experiences in targeting signaling pathways for the development of next generation targeted cancer therapies. For more information, visit Curis website
Cautionary Statement: This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including without limitation: statements regarding the development plans and timelines for GDC-0449, CUDC-101, CUDC-305 and the Company s other drug development programs; the potential clinical
and therapeutic benefits of GDC-0449 and the Company s other programs under development; and the Company s estimate regarding the period in which its existing cash will fund its operations. Forward-looking statements used in this press
release may contain the words believes , expects , anticipates , plans , seeks , estimates , will , may or similar expressions. These forward-looking statements
are not guarantees of future performance and involve risks, uncertainties, assumptions and other factors that may cause the actual results to be materially different from those indicated by such forward-looking statements including, among other
In addition, any forward-looking statements represent the views
only as of today and should not be relied upon as representing the Company s views as of any subsequent date. Curis disclaims any intention or obligation to update any of the forward-looking statements after the date of this press release
whether as a result of new information, future events or otherwise.