Full Press Release Details
Prothena Reports Second Quarter 2018 Financial Results and Provides R&D Update
DUBLIN, Ireland - August 7, 2018 - Prothena Corporation plc (NASDAQ:PRTA), a clinical-stage neuroscience company, today reported financial results for the second quarter and first six months of 2018. In addition, the Company provided an update on its R&D programs.
"We are developing a broad and novel pipeline targeting devastating neurological diseases and steadily advancing both our proprietary programs as well as our collaboration programs with Roche and Celgene," said Gene Kinney, PhD, President and Chief Executive Officer of Prothena. "Enrollment in the ongoing clinical studies of PRX004 and prasinezumab (PRX002/RG7935) is continuing and we expect initial data from these programs in 2019 and 2020, respectively. Additionally, we are advancing multiple discovery-stage programs towards the clinic with the potential to offer significant benefit to patients who suffer from neurological diseases with tremendous unmet medical need."
Second Quarter 2018 and Recent Highlights:
Upcoming Research and Development Milestones
Prasinezumab (PRX002/RG7935)
Second Quarter and First Six Months of 2018 Financial Results
For the second quarter and first six months of 2018, Prothena reported a net loss of $59.9 million and $108.6 million, respectively, which includes restructuring charges of $20.9 million associated with the discontinuation of the NEOD001 program, as compared to a net loss of $17.7 million and $53.1 million for the second quarter and first six months of 2017, respectively. Net loss per share for the second quarter and first six months of 2018 was $1.50 and $2.77, respectively, as compared to a net loss per share of $0.46 and $1.44 for the second quarter and first six months of 2017, respectively.
Prothena reported total revenue from its collaboration with Roche of $0.3 million and $0.5 million for the second quarter and first six months of 2018, respectively, as compared to total revenue of $26.8 million and $27.1 million for the second quarter and first six months of 2017, respectively.
Research and development (R&D) expenses totaled $31.5 million and $66.2 million for the second quarter and first six months of 2018, respectively, as compared to $34.0 million and $59.7 million for the second quarter and first six months of 2017, respectively. The decrease in R&D expenses for the second quarter compared to the same period in the prior year was primarily due to lower product manufacturing expenses and to a lesser extent lower clinical trial costs, offset in part by higher expenses associated with prasinezumab (PRX002/RG7935). The increase in R&D expenses for the first six months compared to the same period in the prior year was primarily due to higher expenses associated with prasinezumab, higher consulting expenses and higher personnel costs, which were partially offset by lower product manufacturing expenses and to a lesser extent lower clinical trial costs. R&D expenses included non-cash share-based compensation expense of $2.6 million and $4.8 million for the second quarter and first six months of 2018, respectively, as compared to $2.7 million and $5.0 million for the second quarter and first six months of 2017, respectively.
General and administrative (G&A) expenses totaled $11.0 million and $25.2 million for the second quarter and first six months of 2018, respectively, as compared to $10.9 million and $21.7 million for second quarter and first six months of 2017, respectively. The increase in G&A expenses for the first six months compared to the same periods in the prior year was primarily due to higher personnel costs and to a lesser extent higher legal expenses. G&A expenses included non-cash share-based compensation expense of $3.8 million and $8.4 million for the second quarter and first six months of 2018, respectively, as compared to $3.9 million and $7.2 million for the second quarter and first six months of 2017, respectively.
Total non-cash share-based compensation expense was $8.8 million and $15.7 million for the second quarter and first six months of 2018, respectively, which included $2.5 million of non-cash share-based compensation
expense included in the restructuring costs, as compared to $6.7 million and $12.3 million for the second quarter and first six months of 2017, respectively.
As of June 30, 2018, Prothena had $490.3 million in cash, cash equivalents and restricted cash (including the $100 million upfront payment received from Celgene in April 2018) and no debt.
As of July 20, 2018, Prothena had approximately 39.8 million ordinary shares outstanding.
The Company expects its 2018 net cash burn from operating and investing activities to be $40 to $50 million, which includes $110 million of cash provided by operating activities associated with the Celgene collaboration, and to end the year with approximately $421 million in cash (mid-point). The estimated 2018 net cash burn from operating and investing activities is primarily driven by an estimated net loss of $170 to $185 million, which includes an estimated $25 million of non-cash share-based compensation expense. The estimated 2018 net loss includes $80 to $85 million of operating expenses associated with NEOD001 and the Company's reorganization, including research, development, manufacturing and pre-commercial expenses, severance costs and contract termination fees related to manufacturing obligations and approximately $8 million of non-cash share-based compensation expense.
Forward-looking Statements
This press release contains forward-looking statements. These statements relate to, among other things, the sufficiency of our funding to advance a broad neuroscience pipeline; or goal of developing a broad and novel pipeline targeting neurological diseases; the potential of our multiple discovery-stage programs to eventually offer significant benefit to patients; the expected timing of having data from our Phase 2 study of prasinezumab (PRX002/RG7935) and our Phase 1 study of PRX004; the expected timing of initiating cell line development of lead candidates from our preclinical tau and A programs; our expected net cash burn from operating and investing activities for 2018 and cash balance at the end of 2018; and our estimated net loss and non-cash share-based compensation expense for 2018. These statements are based on estimates, projections and assumptions that may prove not to be accurate, and actual results could differ materially from those anticipated due to known and unknown risks, uncertainties and other factors, including but not limited to the risks, uncertainties and other factors described in the "Risk Factors" sections of our Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 26, 2018 and our subsequent Quarterly Reports on Form 10-Q filed with the SEC. Prothena undertakes no obligation to update publicly any forward-looking statements contained in this press release as a result of new information, future events or changes in Prothena's expectations.
PROTHENA CORPORATION PLC
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited - amounts in thousands except per share data)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| Collaboration revenue | $ | 279 | $ | 26,812 | $ | 506 | $ | 27,071 | ||||||||
| Total revenue | 279 | 26,812 | 506 | 27,071 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 31,452 | 34,032 | 66,158 | 59,730 | ||||||||||||
| General and administrative | 10,992 | 10,912 | 25,221 | 21,744 | ||||||||||||
| Restructuring costs | 20,904 | - | 20,904 | - | ||||||||||||
| Total operating expenses | 63,348 | 44,944 | 112,283 | 81,474 | ||||||||||||
| Loss from operations | (63,069 | ) | (18,132 | ) | (111,777 | ) | (54,403 | ) | ||||||||
| Other income (expense), net | 1,241 | (856 | ) | 1,169 | (1,630 | ) | ||||||||||
| Loss before income taxes | (61,828 | ) | (18,988 | ) | (110,608 | ) | (56,033 | ) | ||||||||
| Benefit from income taxes | (1,946 | ) | (1,287 | ) | (1,983 | ) | (2,948 | ) | ||||||||
| Net loss | $ | (59,882 | ) | $ | (17,701 | ) | $ | (108,625 | ) | $ | (53,085 | ) | ||||
| Basic and diluted net loss per share | $ | (1.50 | ) | $ | (0.46 | ) | $ | (2.77 | ) | $ | (1.44 | ) | ||||
| Shares used to compute basic and diluted net loss per share | 39,824 | 38,073 | 39,257 | 36,922 |
PROTHENA CORPORATION PLC
CONSOLIDATED BALANCE SHEETS
(unaudited - amounts in thousands)
| June 30, | December 31, | ||||||
| 2018 | 2017 | ||||||
| Assets | |||||||
| Cash and cash equivalents | $ | 486,212 | $ | 417,620 | |||
| Accounts receivable | 8 | 240 | |||||
| Other current assets | 7,817 | 8,467 | |||||
| Total current assets | 494,037 | 426,327 | |||||
| Property and equipment, net | 53,398 | 54,990 | |||||
| Restricted cash | 4,056 | 4,056 | |||||
| Other assets | 11,809 | 10,956 | |||||
| Total non-current assets | 69,263 | 70,002 | |||||
| Total assets | $ | 563,300 | $ | 496,329 | |||
| Liabilities and Shareholders' Equity | |||||||
| Accrued research and development | $ | 10,160 | $ | 13,509 | |||
| Restructuring liability | 18,396 | - | |||||
| Other current liabilities | 17,576 | 23,862 | |||||
| Total current liabilities | 46,132 | 37,371 | |||||
| Deferred revenue | 110,242 | - | |||||
| Other non-current liabilities | 50,920 | 51,769 | |||||
| Total non-current liabilities | 161,162 | 51,769 | |||||
| Total liabilities | 207,294 | 89,140 | |||||
| Total shareholders' equity | 356,006 | 407,189 | |||||
| Total liabilities and shareholders' equity | $ | 563,300 | $ | 496,329 |
Media and Investor Contact:
Ellen Rose, Head of Communications
650-922-2405, ellen.rose@prothena.com