Merrimack Reports Third Quarter 2015 Financial Results

CAMBRIDGE, Mass., Nov. 9, 2015 /PRNewswire/ -- Merrimack Pharmaceuticals, Inc. (Nasdaq: MACK), a biopharmaceutical company that applies systems biology to develop cancer treatments and diagnostics, today announced its third quarter 2015 financial results. Merrimack will host a live conference call and webcast today, Monday, November 9 at 4:30 p.m., Eastern time, to provide an update on Merrimack's progress as well as a summary of these results.

Investors and the general public are invited to listen to the call by dialing (877) 564-1301 (domestic) or (224) 357-2394 (international) five minutes prior to the start of the call and providing the passcode 69525411. A listen-only webcast of the call can be accessed in the Investors section of Merrimack's website, investors.merrimack.com, and a replay of the call will be archived there for six weeks following the call.

Key Recent Events

• Approval of ONIVYDE (irinotecan liposome injection) by the U.S. Food and Drug Administration on October 22, 2015;
• Commercial launch of ONIVYDE in the United States on October 26, 2015;
• Enrollment of first patient in a Phase 2 clinical study of ONIVYDE in previously untreated front-line metastatic pancreatic cancer; and
• Achievement of $66.5 million in net milestone payments from collaborations in 2015, consistent with Merrimack's previous financial guidance.

Upcoming Milestones

Merrimack anticipates the following clinical milestones:

• Initiation of a Phase 3 clinical study of ONIVYDE in front-line HER2-negative gastric cancer in 2016;
• Results from the Phase 2 clinical study of MM-121 in patients with heregulin-positive, locally advanced or metastatic non-small cell lung cancer in the second half of 2016;
• Results from the Phase 2 clinical study of ONIVYDE in previously untreated front-line metastatic pancreatic cancer in the first half of 2017;
• Results from HERMIONE, the Phase 2 clinical study of MM-302 in patients with HER2-positive metastatic breast cancer designed to support a potential Accelerated Approval application to the FDA, in 2017; and
• Results from the Phase 2 clinical study of MM-141 in patients with front-line metastatic pancreatic cancer who have high serum levels of free IGF-1 in 2017.

Third Quarter 2015 Financial Results

Revenue for the third quarter of 2015 was $16.4 million compared with revenue of $28.0 million for the third quarter of 2014, a decrease of $11.6 million or 41%.  This decrease was primarily due to the termination of Merrimack's collaboration with Sanofi effective December 17, 2014 and was offset by increased revenue recognized related to Merrimack's collaboration with Baxalta during the third quarter of 2015.

Research and development expenses for the third quarter of 2015 decreased $5.9 million over the corresponding quarter of the preceding year.  This decrease was primarily due to $12.0 million of non-recurring ONIVYDE collaboration milestones that were expensed in the third quarter of 2014.  This decrease was offset by increased spending on Merrimack's remaining pipeline.

General and administrative expenses for the third quarter of 2015 increased $8.9 million over the corresponding quarter of the preceding year.  This increase was primarily attributable to increased infrastructure and personnel expenses as Merrimack prepared for the commercialization of ONIVYDE.

Merrimack's net loss for the third quarter of 2015 was $42.4 million, or basic and diluted net loss per share available to common stockholders of $0.38, as compared to a net loss for the third quarter of 2014 of $28.0 million, or basic and diluted net loss per share available to common stockholders of $0.27.

Financial Outlook

Merrimack expects to be able to fund operations into the second quarter of 2016 based on the following:

- unrestricted cash and cash equivalents and available-for-sale securities of $62.4 million as of September 30, 2015;
- $47.5 million of milestones from Baxalta anticipated in the fourth quarter of 2015 related to the first patient dosed in the Phase 2 clinical study of ONIVYDE in previously untreated front-line metastatic pancreatic cancer; and
- anticipated cost sharing reimbursements from Baxalta. 

Additional funding for operations would also come from:

- anticipated receipt of $46.5 million of net milestones related to ONIVYDE in 2016 from Baxalta, after offsetting payments to PharmaEngine;
- sales of ONIVYDE; and
- up to $15.0 million in additional debt that is currently available at Merrimack's option under its loan agreement with Hercules Technology Growth Capital.

Upcoming Investor Conferences

Merrimack will attend the following investor conferences this fall:

• Credit Suisse 24^th Annual Healthcare Conference on November 11 in Scottsdale, AZ;
• Jefferies Autumn 2015 Global Healthcare Conference on November 18 in London;
• Oppenheimer 26th Annual Healthcare Conference on December 8 in New York; and
• Guggenheim 3rd Annual Boston Healthcare Conference on December 15 in Boston.

Live webcasts of the presentations at the Credit Suisse 24^th Annual Healthcare Conference, Jefferies Autumn 2015 Global Healthcare Conference and Oppenheimer 26th Annual Healthcare Conference can be accessed by visiting the Investors section of Merrimack's website at investors.merrimack.com. A replay of the webcasts will be archived there for two weeks following each presentation.

About Merrimack

Merrimack is a fully integrated biopharmaceutical company that views cancer as a complex engineering challenge. Through systems biology, which brings together the fields of biology, computing and engineering, Merrimack aims to decrease uncertainty in drug development and clinical validation, and move discovery efforts beyond trial and error.

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