Full Press Release Details
SAN FRANCISCO , Nov. 7, 2013 /PRNewswire/ -- Nektar Therapeutics (Nasdaq: NKTR ) today reported its financial results for the third quarter ended September 30, 2013 .
Cash and investments in marketable securities at September 30, 2013 were $208.6 million as compared to $302.2 million at December 31, 2012 .
"Nektar continues to have a very productive year achieving significant milestones with both our partnered programs and proprietary pipeline," said Howard W. Robin , President and Chief Executive Officer of Nektar. "For naloxegol, the MAA in Europe and NDS in Canada are now accepted for filing and the NDA in the U.S. was submitted for filing in mid-September. Naloxegol could be the first once-daily oral peripheral opioid antagonist approved to treat opioid-induced constipation. BAX 855, Baxter's longer-acting PEGylated Factor VIII therapy, which is in Phase 3, remains on track for a 2014 BLA filing. Finally, while I am disappointed that the results from the Phase 2 efficacy study for NKTR-181 were confounded by an unusual placebo response, we are working with our advisors and the FDA to design an optimal Phase 3 program, which should start by the middle of 2014."
Revenue in the third quarter of 2013 was $60.9 million as compared to $18.4 million in the third quarter of 2012. Year-to-date revenue for 2013 was $117.8 million as compared to $60.0 million in the first nine months of 2012. Revenues included non-cash royalty revenue, related to our 2012 royalty monetization, of $4.5 million and $12.7 million in the third quarter and year-to-date for 2013, respectively, and $3.4 million in the third quarter and $6.9 million in the first nine months of 2012. This non-cash royalty revenue is offset by non-cash interest expense. The increases in revenue in the third quarter and first nine months of 2013 as compared to the same periods in 2012 are primarily due to a $25.0 million milestone achieved upon the acceptance of the naloxegol MAA filing in Europe as well as increased product sales. In addition, revenue in the first nine months of 2013 increased as compared to the same period in 2012 due to a $10.0 million milestone achieved upon the initiation of Phase 3 studies for Amikacin Inhale in April 2013 .
Total operating costs and expenses in the third quarter of 2013 were $67.4 million as compared to $51.3 million in the third quarter of 2012. Year-to-date total operating costs and expenses in 2013 were $202.0 million as compared to $157.9 million for the same period in 2012. Total operating costs and expenses increased primarily as a result of increased clinical development expenses.
Research and development expenses in the third quarter of 2013 were $43.9 million as compared to $34.0 million in the third quarter of 2012. Year-to-date R&D expense for 2013 was $141.8 million as compared to $102.3 million for the same period in 2012. R&D expense was higher in the third quarter and the first nine months of 2013 as compared to the same periods in 2012 reflecting the costs of the Phase 3 study of etirinotecan pegol (NKTR-102) in metastatic breast cancer, the Phase 2 study of NKTR-181, preparation for the Phase 3 study of NKTR-181, the Phase 1 study of NKTR-192, and the production of devices for the Phase 3 study of Amikacin Inhale.
General and administrative expense was $10.6 million in the third quarter of 2013 as compared to $10.1 million in the third quarter of 2012. G&A expense in the first nine months of 2013 was $30.7 million as compared to $30.8 million for the same period in 2012.
Non-cash interest expense incurred in connection with the 2012 royalty monetization was $5.6 million and $16.6 million in the third quarter and first nine months of 2013, respectively, as compared to $5.5 million and $12.6 million in the third quarter and first nine months of 2012, respectively.
Net loss in the third quarter of 2013 was $16.5 million or $0.14 per share as compared to a net loss of $43.5 million or $0.38 per share in the third quarter of 2012. Net loss in the first nine months of 2013 was $114.4 million or $0.99 per share as compared to a net loss of $118.9 million or $1.04 per share in the first nine months of 2012.
Conference Call to Discuss Third Quarter 2013 Financial Results
Nektar management will host a conference call to review the results beginning at 5:00 p.m. Eastern Time / 2:00 p.m. Pacific Time today, Thursday, November 7, 2013 .
This press release and a live audio-only Webcast of the conference call can be accessed through a link that is posted on the home page and Investor Relations section of the Nektar website: http://www.nektar.com . The web broadcast of the conference call will be available for replay through Monday, December 9, 2013 .
| To access the conference call, follow these instructions: |
| Dial: (877) 881.2183 (U.S.); (970) 315.0453 (international) |
| Passcode : 91919000 (Nektar Therapeutics is the host) |
In the event that any non-GAAP financial measure is discussed on the conference call that is not described in the press release, or explained on the conference call, related information will be made available on the Investor Relations page at the Nektar website as soon as practical after the conclusion of the conference call.
Nektar Therapeutics (NASDAQ: NKTR ) is a biopharmaceutical company developing novel therapeutics based on its PEGylation and advanced polymer conjugation technology platforms. Nektar has a robust R&D pipeline of potentially high-value therapeutics in pain, oncology and other therapeutic areas. In the area of pain, Nektar has an exclusive worldwide license agreement with AstraZeneca for naloxegol (NKTR-118), an investigational drug candidate, which has completed Phase 3 development as a once- daily, oral tablet for the treatment of opioid-induced constipation. For naloxegol, the MAA in Europe and the NDS in Canada have been accepted for filing, and an NDA has been submitted for filing in the U.S. This agreement also includes NKTR-119, an earlier stage development program that is a co-formulation of naloxegol and an opioid. NKTR-181, a novel mu-opioid analgesic molecule for chronic pain conditions, has completed Phase 2 development in osteoarthritis patients with chronic knee pain. NKTR-192, a novel mu-opioid analgesic molecule in development to treat acute pain is in Phase 1 clinical development. In oncology, etirinotecan pegol (NKTR-102) is being evaluated in a Phase 3 clinical study (the BEACON study) for the treatment of metastatic breast cancer and is also in a number of Phase 2 studies. In anti-infectives, Amikacin Inhale is in Phase 3 studies conducted by Bayer Healthcare to treat patients with Gram-negative pneumonia.
Nektar's technology has enabled eight approved products in the U.S. or Europe through partnerships with leading biopharmaceutical companies, including UCB's Cimzia ® for Crohn's disease and rheumatoid arthritis, Roche's PEGASYS ® for hepatitis C and Amgen's Neulasta ® for neutropenia. Additional development-stage products that leverage Nektar's proprietary technology platform include Baxter's BAX 855, a long-acting PEGylated rFVIII program, which is in Phase 3 clinical development.
Nektar is headquartered in San Francisco, California , with additional operations in Huntsville, Alabama and Hyderabad, India . Further information about the company and its drug development programs and capabilities may be found online at http://www.nektar.com .
Cautionary Note Regarding Forward-Looking Statements
| Nektar Investor Inquiries: | |
| Jennifer Ruddock/Nektar Therapeutics | (415) 482-5585 |
| Susan Noonan/SA Noonan Communications, LLC | (212) 966-3650 |
| NEKTAR THERAPEUTICS | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (In thousands) | ||||||||
| (Unaudited) | ||||||||
| ASSETS | September 30, 2013 | December 31, 2012 | (1) | |||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ 65,411 | $ 25,437 | ||||||
| Short-term investments | 118,139 | 251,757 | ||||||
| Accounts receivable | 4,557 | 5,805 | ||||||
| Inventory | 15,076 | 18,269 | ||||||
| Other current assets | 4,759 | 13,363 | ||||||
| Total current assets | 207,942 | 314,631 | ||||||
| Restricted cash | 25,000 | 25,000 | ||||||
| Property and equipment, net | 65,082 | 72,215 | ||||||
| Goodwill | 76,501 | 76,501 | ||||||
| Other assets | 8,510 | 9,443 | ||||||
| Total assets | $ 383,035 | $ 497,790 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ 3,723 | $ 2,863 | ||||||
| Accrued compensation | 13,910 | 8,773 | ||||||
| Accrued expenses | 10,771 | 8,008 | ||||||
| Accrued clinical trial expenses | 15,239 | 17,500 | ||||||
| Deferred revenue, current portion | 21,300 | 21,896 | ||||||
| Interest payable | 3,167 | 7,083 | ||||||
| Other current liabilities | 12,803 | 12,414 | ||||||
| Total current liabilities | 80,913 | 78,537 | ||||||
| Senior secured notes | 125,000 | 125,000 | ||||||
| Capital lease obligations, less current portion | 9,007 | 11,607 | ||||||
| Liability related to sale of future royalties, less current portion | 125,167 | 128,266 | ||||||
| Deferred revenue, less current portion | 82,233 | 96,551 | ||||||
| Deferred gain | 1,748 | 2,404 | ||||||
| Other long-term liabilities | 9,217 | 8,407 | ||||||
| Total liabilities | 433,285 | 450,772 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' equity (deficit) : | ||||||||
| Preferred stock | - | - | ||||||
| Common stock | 11 | 11 | ||||||
| Capital in excess of par value | 1,636,162 | 1,617,744 | ||||||
| Accumulated other comprehensive loss | (1,689) | (357) | ||||||
| Accumulated deficit | (1,684,734) | (1,570,380) | ||||||
| Total stockholders' equity (deficit) | (50,250) | 47,018 | ||||||
| Total liabilities and stockholders' equity (deficit) | $ 383,035 | $ 497,790 | ||||||
| (1) The consolidated balance sheet at December 31, 2012 has been derived from the audited financial statements at that date but does not include all of the information and notes required by generally accepted accounting principles in the United States for complete financial statements. |
| NEKTAR THERAPEUTICS | ||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||
| (In thousands, except per share information) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| September 30, | September 30, | |||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||
| Revenue: | ||||||||||||
| Product sales | $ 14,672 | $ 8,355 | $ 36,806 | $ 24,994 | ||||||||
| Royalty revenue | 354 | 498 | 1,030 | 3,966 | ||||||||
| Non-cash royalty revenue related to sale of future royalties | 4,523 | 3,427 | 12,744 | 6,895 | ||||||||
| License, collaboration and other revenue | 41,360 | 6,132 | 67,195 | 24,190 | ||||||||
| Total revenue | 60,909 | 18,412 | 117,775 | 60,045 | ||||||||
| Operating costs and expenses: | ||||||||||||
| Cost of goods sold | 12,877 | 7,228 | 29,549 | 23,138 | ||||||||
| Research and development | 43,914 | 34,016 | 141,762 | 102,302 | ||||||||
| General and administrative | 10,643 | 10,068 | 30,700 | 30,750 | ||||||||
| Impairment of long-lived assets | - | - | - | 1,675 | ||||||||
| Total operating costs and expenses | 67,434 | 51,312 | 202,011 | 157,865 | ||||||||
| Loss from operations | (6,525) | (32,900) | (84,236) | (97,820) | ||||||||
| Non-operating income (expense): | ||||||||||||
| Interest income | 116 | 603 | 639 | 1,865 | ||||||||
| Interest expense | (4,587) | (5,697) | (13,888) | (10,807) | ||||||||
| Non-cash interest expense on liability related to sale of future royalties | (5,616) | (5,487) | (16,644) | (12,641) | ||||||||
| Other income (expense), net | 262 | 156 | 385 | 913 | ||||||||
| Total non-operating expense, net | (9,825) | (10,425) | (29,508) | (20,670) | ||||||||
| Loss before provision for income taxes | (16,350) | (43,325) | (113,744) | (118,490) | ||||||||
| Provision for income taxes | 193 | 222 | 610 | 439 | ||||||||
| Net loss | $ (16,543) | $ (43,547) | $ (114,354) | $ (118,929) | ||||||||
| Basic and diluted net loss per share | $ (0.14) | $ (0.38) | $ (0.99) | $ (1.04) | ||||||||
| Weighted average shares outstanding used in computing basic and diluted net loss per share | 115,812 | 114,915 | 115,557 | 114,699 |
| NEKTAR THERAPEUTICS | ||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||
| (In thousands) | ||||||||||
| (Unaudited) | ||||||||||
| Nine Months Ended September 30, | ||||||||||
| 2013 | 2012 | |||||||||
| Cash flows from operating activities: | ||||||||||
| Net loss | $ (114,354) | $ (118,929) | ||||||||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||
| Non-cash interest expense on liability related to sale of future royalties | 16,644 | 12,641 | ||||||||
| Non-cash royalty revenue related to sale of future royalties | (12,744) | (6,895) | ||||||||
| Stock-based compensation | 13,165 | 12,015 | ||||||||
| Depreciation and amortization | 10,882 | 10,810 | ||||||||
| Impairment of long-lived assets | - | 1,675 | ||||||||
| Other non-cash transactions | 332 | 641 | ||||||||
| Changes in operating assets and liabilities: | ||||||||||
| Accounts receivable | 1,248 | 1,027 | ||||||||
| Inventory | 3,193 | (4,098) | ||||||||
| Other assets | 6,817 | 10,593 | ||||||||
| Accounts payable | 697 | (401) | ||||||||
| Accrued compensation | 5,137 | (120) | ||||||||
| Accrued expenses | 2,741 | (465) | ||||||||
| Accrued clinical trial expenses | (2,261) | 1,247 | ||||||||
| Deferred revenue | (14,914) | (3,430) | ||||||||
| Interest payable | (3,916) | 1,528 | ||||||||
| Other liabilities | (4,825) | (219) | ||||||||
| Net cash used in operating activities | (92,158) | (82,380) | ||||||||
| Cash flows from investing activities: | ||||||||||
| Maturities of investments | 274,011 | 202,768 | ||||||||
| Purchases of investments | (140,569) | (126,609) | ||||||||
| Restricted cash | - | (25,000) | ||||||||
| Sale of investments | - | 5,378 | ||||||||
| Purchases of property and equipment | (1,382) | (5,744) | ||||||||
| Net cash provided by investing activities | 132,060 | 50,793 | ||||||||
| Cash flows from financing activities: | ||||||||||
| Payment of capital lease obligations | (2,201) | (1,773) | ||||||||
| (Repayment of) proceeds from sale of future royalties, net of $4.4 million transaction costs in 2012 | (3,000) | 119,588 | ||||||||
| Proceeds from issuance of senior secured notes, net of $4.4 million transaction costs | - | 78,006 | ||||||||
| Repayment of convertible subordinated notes | - | (172,407) | ||||||||
| Proceeds from shares issued under equity compensation plans | 5,253 | 3,177 | ||||||||
| Net cash provided by financing activities | 52 | 26,591 | ||||||||
| Effect of exchange rates on cash and cash equivalents | 20 | 22 | ||||||||
| Net increase (decrease) in cash and cash equivalents | 39,974 | (4,974) | ||||||||
| Cash and cash equivalents at beginning of period | 25,437 | 15,312 | ||||||||
| Cash and cash equivalents at end of period | $ 65,411 | $ 10,338 | ||||||||
| Supplemental disclosure of cash flow information: | ||||||||||
| Cash paid for interest | $ 17,097 | $ 9,010 | ||||||||
| Retirement of convertible subordinated notes in exchange for senior secured notes | $ - | $ 42,548 |
SOURCE Nektar Therapeutics