SOUTH SAN FRANCISCO, Calif., Aug. 11, 2014 (GLOBE NEWSWIRE) -- Achaogen, Inc. (Nasdaq:AKAO), a clinical-stage biopharmaceutical company developing novel antibacterials to treat multi-drug resistant (MDR) gram-negative infections, today reported financial results for the quarter ended June 30, 2014.
During the second quarter, the majority of Achaogen's resources were deployed toward advancing its pivotal Phase 3 trial for plazomicin, the Company's lead product for the treatment of serious bacterial infections due to MDR Enterobacteriaceae, including carbapenem-resistant Enterobacteriaceae (CRE). This multinational, resistant pathogen-focused trial is being conducted in the U.S., Europe, South America and Asia with an emphasis on countries with a high rate of CRE. The focus this quarter was on clinical site activations in the U.S. and Europe. The Company experienced operational delays related to activation of test laboratories that measure plazomicin concentration in patients' blood samples and to obtaining required approvals for some clinical sites. However, full site activation inclusive of all countries is anticipated for the first quarter of 2015 and the Company continues to project that top-line data from this trial will be available during the first half of 2017, with interim analyses expected to occur in the second half of 2015 and 2016 respectively. The Company intends to make an announcement after the first patient has been enrolled in the trial.
Considerable effort has been geared to facilitate site activation with a particular focus on Europe and South America, where a significant proportion of patient enrollment is anticipated. "We are making steady progress and currently believe that these start-up delays can be compensated for during the course of the enrollment period through the selection of additional sites in key countries and by improving the efficiency of the site activation process," commented Dr. Kenneth Hillan, Chief Executive Officer of Achaogen.
In addition, Dr. Ian Friedland recently joined the company as Chief Medical Officer. A veteran in the field with sixteen years of experience in antimicrobial drug development at emerging therapeutic and large pharmaceutical companies, Dr. Friedland served as Vice President, Clinical Development at Cubist Pharmaceuticals prior to joining Achaogen. "Ian's appointment brings additional depth in infectious disease to the team and strengthens our position in executing plazomicin's phase 3 trial while ensuring the balance of our pipeline programs advance in a timely manner," concluded Dr. Hillan.
Summary Financial Results
Cash and cash equivalents totaled $74.5 million at June 30, 2014 compared to $84.9 million at March 31, 2014, decreasing as a result of operational expenses combined with $5.7 million used to repay all outstanding amounts owed under our loan arrangement with Oxford Finance LLC and Silicon Valley Bank.
Revenue totaled $5.2 million for the second quarter of 2014 compared to $4.5 million for the comparable quarter of 2013. Achaogen derived all of its revenue from funding provided under U.S. government contracts in connection with the development of product candidates. Research and development (R&D) expenses totaled $6.2 million for the second quarter of 2014 compared to $6.9 million for the comparable quarter of 2013. Revenue under government contracts increased due to higher spending on Achaogen's Phase 3 trial of plazomicin, while R&D expenses decreased because the Phase 1 clinical trial of ACHN-975, from the LpxC inhibitor program, was active in 2013 but was discontinued prior to 2014.
General and administrative expenses increased to $2.4 million for the second quarter of 2014 compared to $1.8 million for the comparable quarter of 2013, primarily due to additional costs associated with becoming a public company.
Net loss totaled $3.6 million for the second quarter of 2014 compared to a net loss of $4.3 million for the comparable quarter of 2013.
About Achaogen
Achaogen is a clinical-stage biopharmaceutical company passionately committed to the discovery, development, and commercialization of novel antibacterials to treat MDR gram-negative infections. Achaogen is developing plazomicin, Achaogen's lead product candidate, for the treatment of serious bacterial infections due to MDR Enterobacteriaceae, including CRE. Through the Special Protocol Assessment procedure, the U.S. Food and Drug Administration has agreed that the design and planned analyses of Achaogen's single pivotal Phase 3 trial adequately address objectives in support of a New Drug Application. Achaogen's plazomicin program is funded in part with a contract from the Biomedical Advanced Research and Development Authority. Plazomicin is the first clinical candidate from Achaogen's gram-negative antibiotic discovery engine, and Achaogen has other programs in early and late preclinical stages focused on other MDR gram-negative infections.
Forward Looking Statements
This press release contains forward-looking statements. All statements other than statements of historical facts contained in this press release are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including Achaogen's expectations regarding the enrollment and success of its Phase 3 trial for plazomicin, the ability to activate all clinical trial sites by first quarter of 2015, the timing of interim analyses and receipt of top-line data from its Phase 3 trial for plazomicin, Achaogen's ability to become a leading anti-infective company, and Achaogen's ability to discover, develop and commercialize novel antibacterials to treat MDR gram-negative infections. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause Achaogen's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, the uncertainties inherent in the preclinical and clinical development process; specific risks related to the Phase 3 trial of plazomicin, including the lack of a prior clinical trial in patients with CRE infections and challenges in enrolling an adequate number of patients with rare infections; the risk of failure to successfully validate, develop and obtain regulatory clearance or approval for the in vitro diagnostic ("IVD") assay for plazomicin; the risks and uncertainties of the regulatory approval process; the risks and uncertainties of commercialization and gaining market acceptance; the risk that bacteria may evolve resistance to plazomicin; Achaogen's dependence on ARK Diagnostics, Inc. to develop and manufacture the IVD assay for plazomicin; risks and uncertainties as to Achaogen's ability to raise additional capital to support the development of plazomicin and its other programs; uncertainties regarding the availability of adequate third-party coverage and reimbursement for newly approved products; Achaogen's reliance on third parties to conduct certain preclinical studies and all of its clinical trials; Achaogen's reliance on third-party contract manufacturing organizations to manufacture and supply its product candidates and certain raw materials used in the production thereof; Achaogen's dependence on its Chief Executive Officer; risks and uncertainties related to the acceptance of government funding for certain of Achaogen's programs, including the risk that BARDA could terminate Achaogen's contract for the funding of the plazomicin development program; risk of third party claims alleging infringement of patents and proprietary rights or seeking to invalidate Achaogen's patents or proprietary rights; and the risk that Achaogen's proprietary rights may be insufficient to protect its technologies and product candidates. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Achaogen's business in general, see Achaogen's Form 10-Q for the fiscal quarter ended June 30, 2014, filed with the Securities and Exchange Commission on August 11, 2014. Achaogen does not plan to publicly update or revise any forward-looking statements contained in this press release, whether as a result of any new information, future events, changed circumstances or otherwise.
| Achaogen, Inc. | ||||
| Condensed Consolidated Statements of Operations and Comprehensive Loss | ||||
| (in thousands except share and per share data) | ||||
| (Unaudited) | ||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||
| 2014 | 2013 | 2014 | 2013 | |
| Contract revenue | $ 5,203 | $ 4,498 | $ 11,191 | $ 8,031 |
| Operating expenses: | ||||
| Research and development | 6,195 | 6,945 | 12,800 | 11,606 |
| General and administrative | 2,346 | 1,759 | 4,963 | 3,913 |
| Total operating expenses | 8,541 | 8,704 | 17,763 | 15,519 |
| Loss from operations | (3,338) | (4,206) | (6,572) | (7,488) |
| Interest expense | (217) | (308) | (397) | (833) |
| Other income (expense), net | -- | 204 | (41) | 258 |
| Net loss and comprehensive loss | $ (3,555) | $ (4,310) | $ (7,010) | $ (8,063) |
| Basic and diluted net loss per common share | $ (0.20) | $ (11.08) | $ (0.66) | $ (21.10) |
| Weighted-average common shares outstanding used to calculate basic and diluted net loss per common share | 17,690,951 | 388,927 | 10,612,843 | 382,162 |
| Achaogen, Inc. | ||
| Condensed Consolidated Balance Sheets | ||
| (in thousands) | ||
|
June 30, 2014 |
December 31, 2013 |
|
| (Unaudited) | ||
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $ 74,496 | $ 10,738 |
| Contracts receivable | 5,276 | 7,230 |
| Prepaids and other current assets | 614 | 1,873 |
| Total current assets | 80,386 | 19,841 |
| Property and equipment, net | 615 | 743 |
| Restricted cash | 127 | 127 |
| Deposit and other assets | 40 | 47 |
| Total assets | $ 81,168 | $ 20,758 |
| Liabilities, convertible preferred stock, and stockholders' equity (deficit ) | ||
| Current liabilities: | ||
| Accounts payable | $ 2,633 | $ 2,923 |
| Accrued liabilities | 2,538 | 3,004 |
| Notes payable, current portion | -- | 4,989 |
| Other current liabilities | -- | 73 |
| Total current liabilities | 5,171 | 10,989 |
| Deferred rent | 148 | 125 |
| Notes payable, noncurrent portion | -- | 1,698 |
| Other long-term liabilities | -- | 244 |
| Total liabilities | 5,319 | 13,056 |
| Convertible preferred stock | -- | 132,278 |
| Stockholders' equity (deficit) | 75,849 | (124,576) |
| Total liabilities, convertible preferred stock, and stockholders' equity (deficit) | $ 81,168 | $ 20,758 |