PTC Therapeutics (PTCT) Reports Third Quarter 2016 Financial Results And Provides Corporate Update
11/3/2016 9:44:12 AM
SOUTH PLAINFIELD, N.J., Nov. 2, 2016 /PRNewswire/ -- PTC Therapeutics, Inc. (NASDAQ: PTCT) today announced a corporate update and reported financial results for the third quarter ending September 30, 2016.
"For the past 18 years, we have focused significant effort towards developing Translarna for those affected by Duchenne," stated Stuart W. Peltz, Ph.D. Chief Executive Officer, PTC Therapeutics, Inc. "Over 400 Duchenne patients have participated in our clinical trials dating back to 2005 and the vast majority continue to remain on Translarna including approximately 130 boys in the United States. With this high compliance rate, we believe these actions speak to the benefit Translarna is providing to patients in the U.S. and around the world. In the E.U., regulatory discussions continue and we anticipate an opinion from the CHMP before the end of the year. With respect to the U.S., we will continue to escalate our appeal so that we may have the opportunity to have the Translarna NDA submission reviewed by the FDA. Our goal remains to deliver this novel therapy to nonsense mutation Duchenne patients globally."
Key Third Quarter and Other Corporate Highlights:
- Translarna net sales of $22M in the third quarter represents 125% year-over-year growth. Commercial access to Translarna continued to expand during the quarter with a significant number of new patients coming from England. While pricing and reimbursement discussions with a number of European countries are ongoing, PTC has now successfully concluded pricing and reimbursement negotiations in both Italy and Romania. PTC anticipates growth from both additional penetration into existing markets as well as expanding access in new geographies across Central and Eastern Europe, the Middle East and Latin America.
- EMA regulatory discussions regarding Translarna's marketing authorization are ongoing. PTC continues to interact with the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) in connection with the company's ongoing request for annual renewal of its marketing authorization for Translarna. Following the company's CHMP meeting in October, the committee requested additional information regarding the risk-benefit profile of Translarna, its efficacy and the design of a potential trial that would provide comprehensive clinical data. While we have provided information in response to the CHMP's requests and expect to continue to engage in further interactions, recent dialogue has introduced a higher degree of uncertainty as to the outcome. PTC anticipates that an opinion regarding its marketing authorization renewal request will be adopted by the CHMP before the end of 2016. The current marketing authorization remains valid while the EMA assessment is ongoing and until a decision is made by the European Commission.
- Appeal process of FDA's Refuse to File regarding Translarna for DMD continues. As PTC previously stated, the RTF appeal could be an iterative process requiring multiple rounds before a conclusion. Having had its appeal denied, the company intends to continue the appeal to higher levels of the FDA. PTC continues to believe that the FDA can only accomplish a proper assessment of the data and analyses based on the results of the company's extensive clinical research and experience in more than 400 boys in the context of a full and fair review. This would include an advisory committee meeting that allows DMD clinical experts and representatives of the patient community to express their views on Translarna for the treatment of nmDMD. PTC intends to provide an update following a final conclusion of the appeal process or, alternatively, following a determination by the company to pursue an alternate regulatory strategy for advancing the potential approval of Translarna for the treatment of nmDMD in the U.S.
- ACT CF Phase 3 clinical trial results expected late first quarter 2017. PTC's confirmatory Phase 3 ACT CF clinical trial, a 48-week placebo-controlled trial designed to evaluate the efficacy of Translarna in patients six years of age or older with nonsense mutation cystic fibrosis, is ongoing. Following feedback from the FDA and the company's CHMP rapporteurs during the third quarter, PTC modified the protocol for ACT CF. In-line with clinical trials for other approved CF therapies, the primary endpoint of lung function as measured by FEV1 was updated from relative change to absolute change in percent predicted FEV1. Pulmonary exacerbations will be an important secondary endpoint.
- SMA program advancing with Phase 2 SUNFISH trial initiated in Type 2/3 patients. PTC's joint development program in Spinal Muscular Atrophy (SMA) with Roche and the SMA Foundation initiated a Phase 2 study in pediatric and adult Type 2/3 SMA patients. SUNFISH, is a two-part study investigating the safety, tolerability and efficacy of RG7916, an oral small molecule survival motor neuron 2 (SMN2) splicing modifier. The first part of the study will evaluate safety and tolerability through escalating doses of RG7916. After dose selection, the study will transition into the pivotal second part evaluating the efficacy of RG7916. Initiation of the pivotal second part of the study is expected to begin in 2017 and will trigger a $20 million milestone payment to PTC from Roche. A similarly designed two-part study to evaluate RG7916 in Type 1 SMA patients is expected to begin in the coming months.
- PTC596 cancer stem cell program to advance in clinical development in 2017.
Phase 1 safety data from PTC's clinical oncology program were recently presented at the European Society for Medical Oncology Congress. The ongoing Phase 1 dose-escalation study is evaluating the safety, tolerability and pharmacokinetics of PTC596 in patients with advanced solid tumors as a monotherapy. Preliminary results demonstrate that PTC596 is generally well tolerated at doses associated with exposures that achieved or exceeded efficacious target plasma concentrations in preclinical studies. Escalating doses are being evaluated for safety, pharmacodynamics, and to determine a target dose for subsequent studies. PTC596 is a novel, oral investigational drug that reduces the levels of BMI1, a protein that is required for cancer stem cell survival. Based on its proposed mechanism of action, PTC596 is expected to be most efficacious when used as part of combination therapy. Continued clinical development of PTC596 is being planned for 2017.
Third Quarter Financial Highlights:
- Translarna net product sales were $22.0 million for the third quarter of 2016, representing a 125% increase versus $9.8 million in the third quarter of 2015. Net sales increased in conjunction with continued expansion of commercial access to Translarna for nonsense mutation DMD boys outside of the U.S.
- Total revenues for the third quarter of 2016 were $23.0 million, an increase of $13.2 million or 135% compared to $9.8 million in the same period of 2015. The change in total revenue was primarily a result of the expanded commercial launch of Translarna.
- GAAP R&D expenses were relatively flat at $31.4 million for the third quarter of 2016 compared to $30.6 million for the same period in 2015. Non-GAAP R&D expenses were $27.1 million for the third quarter of 2016, excluding $4.3 million in non-cash, stock-based compensation expense, compared to $26.8 million for the same period in 2015, excluding $3.8 million in non-cash, stock-based compensation expense.
- GAAP SG&A expenses were $23.7 million for the third quarter of 2016 compared to $21.4 million for the same period in 2015. Non-GAAP SG&A expenses were $19.0 million for the third quarter of 2016, excluding $4.6 million in non-cash, stock-based compensation expense, compared to $17.1 million for the same period in 2015, excluding $4.2 million in non-cash, stock-based compensation expense. The increase in SG&A expense for the third quarter 2016 as compared to the prior year period primarily resulted from additional costs associated with commercial activities in support of Translarna across Europe and other regions.
- Net interest expense for the third quarter of 2016 was $2.1 million compared to net interest expense of $0.9 million in the same period in 2015. The increase in interest expense is primarily a result of the $150 million convertible debt offering completed during mid-third quarter 2015. The debt was recorded on PTC's balance sheet at a discount, which will be amortized over the life of the bond.
- Net loss for the third quarter of 2016 was $35.2 million, a decrease of $8.1 million compared to a net loss of $43.2 million for the same period in 2015.
- Cash, cash equivalents, and marketable securities totaled approximately $248.3 million at September 30, 2016 compared to approximately $338.9 million at December 31, 2015.
- Shares issued and outstanding as of September 30, 2016 were 34.3 million, which includes 0.2 million shares of unvested restricted stock.
- PTC expects to achieve total ex-US nmDMD Translarna net sales in the middle of our guidance of $65 to $85 million for 2016.
- Operating expenses for the full year 2016 are now anticipated to be between $180 million and $190 million, excluding expected non-cash stock-based compensation expense of approximately $35 million, for total operating expenses of approximately $215 million to $225 million. These expenses are in support of our ongoing clinical trials for Translarna in nmDMD and nmCF, commercial launch activities for Translarna outside of the U.S., and the continued research and clinical development of other product pipeline candidates.
- PTC expects to end 2016 with cash and cash equivalents of approximately $220 million.
Non-GAAP Financial Measures
- In this press release, PTC's financial results and financial guidance are provided in accordance with accounting principles generally accepted in the United States (GAAP) and using certain non-GAAP financial measures. In particular, non-GAAP financial results exclude stock-based compensation expense and restructuring expenses relating to the reorganization of operations intended to improve efficiency and better align costs and employment structure with the Company's strategic plans. These results are provided as a complement to results reported in GAAP, because management uses these non-GAAP financial measures when assessing and identifying operational trends.
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