Full Press Release Details
VYNE Therapeutics Reports Third Quarter 2021
Financial Results and Provides Business Update
Lead BET Inhibitor Candidate, VYN201, Demonstrates
Potent Anti-Inflammatory Effect in Preclinical Studies
VYN201 Expected to Enter Clinic in 2022
Phase 2a Results for FMX114 in Mild-to-Moderate
Atopic Dermatitis Expected Early Q1 2022
Process for Sale of Topical Minocycline Franchise
Continues to Advance
Conference call and Live Webcast Today at
8:30 am Eastern Time
BRIDGEWATER, N.J., November 10, 2021 -- VYNE
Therapeutics Inc. (Nasdaq: VYNE) ("VYNE" or the "Company") today announced financial results for the third quarter
ended September 30, 2021 and provided a business update.
"The third quarter marks an important turning
point for VYNE, as our company is now fully engaged in the development of next-generation therapeutics designed to address multiple immuno-inflammatory
diseases," said David Domzalski, CEO of VYNE. "Based upon a growing body of preclinical data, we believe the evolving therapeutic
profile for the BET inhibitor drug class represents a potential breakthrough in the treatment of immuno-inflammatory diseases. Our lead
candidate, VYN201, is demonstrating a strong ability to effect multiple pro-inflammatory pathways while also appearing to be well tolerated
in animal models. As we move toward 2022, creating shareholder value remains front and center for our company and we look forward to our
Phase 2a data readout for FMX114 in Q1 2022 and advancing our lead BET inhibitor candidates."
VYN201, Topical BET Inhibitor Program:
On October 26, 2021 and November 4, 2021, VYNE announced data from preclinical studies showing that its pan-bromodomain BET inhibitor,
VYN201, significantly reduced the expression of several key pro-inflammatory cytokines relevant to Th17-mediated autoimmune diseases and
demonstrated improvement in reducing fibrotic tissue mass and overall skin repair outcomes. Key highlights from the preclinical studies
| VYN201 exhibited anti-inflammatory effect similar to super-potent glucocorticosteroids. | ||
| VYN201 appeared well-tolerated in mice, as seen through animal body weight and skin condition. | ||
| VYN201 also demonstrated stronger inhibition of key Th17 cytokines in ex vivo data with human skin tissue when directly compared to JAK1/2 inhibitor, ruxolitinib. | ||
| VYN201, demonstrated improvements in reducing fibrotic tissue mass and overall skin repair outcomes with no negative impact on healing time, supporting the continued progression of the VYN201 development program. |
Following the completion of the prerequisite IND-enabling
non-clinical safety assessments, the Company intends to communicate the initial indication it will be pursuing for VYN201 and expects
to enter the program into the clinic in 2022.
VYN202, Oral BET Inhibitor Program: VYN202
is an orally delivered, first-in-class BET inhibitor that is highly selective for Bromodomain 2 ("BD2"). By selectively inhibiting
BD2, the Company believes VYN202 could have a more targeted anti-inflammatory effect with an improved benefit/risk profile. Upon the selection
of a lead candidate, VYNE intends to exercise its exclusive option with In4Derm Limited and commence an IND-enabling non-clinical safety
FMX114 for Atopic Dermatitis (AD): In October,
VYNE announced the first patient had enrolled in its Phase 1b/2a study comparing the safety and efficacy of FMX114 gel with vehicle gel
in patients with mild-to-moderate AD. Topline results from the Phase 2a portion of the study are anticipated early in the first quarter
Strategic Process to Sell Topical Minocycline
The Company continues to execute its process to
divest its topical minocycline franchise, including AMZEEQ, ZILXI and FCD105 (the Company's Phase 3 proprietary novel topical combination
foam formulation of minocycline and adapalene for the treatment of moderate-to-severe acne vulgaris), as well as the underlying Molecule
Stabilizing Technology (MST) platform specific to this portfolio.
"We believe our minocycline franchise is
a high-quality commercial platform that has significant value," said Mr. Domzalski. "We are encouraged by the level of interest
we have received and will provide additional details as we continue to progress the sale process."
| Financial Performance (in thousands, except per share amounts) | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| Total Revenues | $ | 4,086 | $ | 3,269 | $ | 12,463 | $ | 16,707 | ||||||||
| Net Loss | $ | (21,285 | ) | $ | (24,714 | ) | $ | (61,759 | ) | $ | (232,387 | ) | ||||
| Diluted Net Loss per Share | $ | (0.41 | ) | $ | (0.59 | ) | $ | (1.22 | ) | $ | (7.98 | ) | ||||
| Adjusted Net Loss* | $ | (18,880 | ) | $ | (22,094 | ) | $ | (55,011 | ) | $ | (78,169 | ) | ||||
| Adjusted Diluted Net Loss per Share* | $ | (0.36 | ) | $ | (0.53 | ) | $ | (1.09 | ) | $ | (2.68 | ) | ||||
| Adjusted EBITDA* | $ | (15,378 | ) | $ | (20,934 | ) | $ | (49,318 | ) | $ | (74,944 | ) |
* See "Note Regarding the Use of Non-GAAP Financial Measures"
elsewhere in this earnings release.
Cash and Cash Equivalents
As of September 30, 2021, VYNE had cash, cash equivalents and
restricted cash of $52.9 million. On August 11, 2021, the Company paid its lenders approximately $36.5 million in respect of its
outstanding indebtedness and the Credit Agreement was terminated. See Note 1 to our unaudited interim condensed consolidated financial
statements included in VYNE's Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 for additional discussion
Financial Results for the Third Quarter Ended September 30,
Revenues totaled $4.1 million for the three months
ended September 30, 2021 compared to $3.3 million for the three months ended September 30, 2020. For the three months ended
September 30, 2021, our revenue consisted of $4.0 million of product sales and $0.1 million of royalty revenue. For the three months
ended September 30, 2020, revenues consisted of $2.9 million of product sales, and $0.4 million of royalty revenue.
Cost of goods sold was $1.0 million and $0.4 million
for the three months ended September 30, 2021 and 2020, respectively. The increase in cost of goods sold was primarily due to an
increase in sales volume.
Our gross margin percentage was 73% for the three
months ended September 30, 2021. Our gross margin percentage of 87% for the three months ended September 30, 2020
was favorably impacted by product sales with certain materials produced prior to FDA approval and therefore expensed in prior periods.
Research and Development Expenses
Our research and development expenses for the
three months ended September 30, 2021 were $7.0 million, representing an increase of $0.4 million, or 5.4%, compared to $6.6 million
for the three months ended September 30, 2020. Employee-related expenses, including stock-based compensation, increased by $1.0 million.
Expenditures for FMX114 and our BET inhibitor programs increased by $1.8 million, including fees due to In4Derm upon the execution
of the Option Agreement and in connection with the exercise of the Topical BETi Option. The increases were offset by a decrease in clinical
trial and manufacturing expenses due to the completion of FCD105 and serlopitant clinical trials and the product launches of AMZEEQ and
Selling, General and Administrative Expenses
Our selling, general and administrative expenses
for the three months ended September 30, 2021 were $13.8 million, representing a decrease of $5.9 million, or 30.0%, compared to
$19.8 million for the three months ended September 30, 2020. Employee-related expenses decreased by $2.0 million primarily due to
lower headcount in 2021. Commercial operations and marketing expenditures decreased by $2.5 million as a result of the strategic
shift of the business announced in August 2021. The balance of the decrease was primarily due to corporate costs incurred during 2020
following the merger between Menlo Therapeutics Inc. and Foamix Pharmaceuticals Ltd. that were eliminated or reduced in 2021. See Note
1 to our unaudited interim condensed consolidated financial statements included in VYNE's Quarterly Report on Form 10-Q for the
quarter ended September 30, 2021 for additional information regarding the merger.
Conference Call and Live Webcast
VYNE management will host a conference call and live webcast today,
Thursday, November 10, 2021, at 8:30 am Eastern Time to discuss the financial results and provide a business update.
| Toll Free: | 855-327-6837 |
| International: | 631-891-4304 |
| Conference ID: | 10017178 |
| Webcast: | https://viavid.webcasts.com/starthere.jsp?ei=1512469&tp_key=ee68066700 |
A replay of the call will be archived on the Company's website
at www.vynetherapeutics.com promptly after the conference call.
Note Regarding the Use of Non-GAAP Financial Measures
The Company has provided certain non-GAAP financial
information as additional information to measure operating performance, including, among others, Adjusted Total Operating Expenses, Adjusted
Net Loss, Adjusted Diluted Net Loss per Share and Adjusted EBITDA. The Company believes that its presentation of such non-GAAP measures
provides useful information to management and investors regarding its financial condition and operations. Specifically, these measures
exclude, among other things, share-based compensation. The Company does not believe that such expenses accurately reflect the Company's
ongoing operations, and the Company does not expect to incur similar expenses in future periods. These measures are not in accordance
with, or an alternative for, generally accepted accounting principles in the United States ("GAAP") and may be different from
similarly titled non-GAAP measures reported by other companies. The Company has provided required reconciliations to the most comparable
GAAP measures elsewhere in the document.
About Bromodomain and Extra-Terminal Domain (BET) Inhibitors
BET proteins play a key role in regulating gene
transcription via epigenetic interactions ("reading"), and recent research has determined a key role for these BET proteins
in regulating B cell and T cell activation and subsequent inflammatory processes. As epigenetic readers, BET proteins regulate the recruitment
of transcriptional factors that are key to the production of several pro-inflammatory cytokines. Inhibiting BET proteins blocks cytokine