Bay Area's Alexza Pharma Reports Q4 Loss, Warns It May Shut Down

Bay Area's Alexza Pharma Reports Q4 Loss, Warns It May Shut Down
March 29, 2016
By Mark Terry, BioSpace.com Breaking News Staff

Alexza Pharmaceuticals , headquartered in Mountain View, Calif., reported its fourth quarter and year-end financials yesterday, with a $3 million quarterly loss and a yearly net loss of $21.3 million.

“We continue our efforts to increase the value of Adasuve, our pipeline and of Alexza,” said Thomas King, Alexza’s president and chief executive officer, in a statement. “In the last six months, we have decreased our costs, repositioned our management team, secured additional financing and continued to work with Guggenheim to explore strategic options.”

The company believes it has enough capital to meet its cash needs until the end of April 2016. If it does not find more capital, it may have to shut down completely.

Total revenues for 2015 were $5 million, down slightly from $5.6 million in 2014.

In its conference call yesterday, King said, “Revenue in 2015 consists of three components. One, product sales from the units of Adasuve sold to Teva and Ferrer. Two, the amortization of the upfront payments received from Ferrer. And three, royalty revenue from Teva for the Adasuve sales in the United States.”

Adasuve is used to agitation associated with schizophrenia or bipolar disorders. However, King stated in the call, “With commercial production completed, we suspended Adasuve production operation. We planned for Adasuve commercial production to resume in the future, as additional commercial product is required by our current or future partners.” He also indicated they may contract with third-party manufacturers if it was more efficient.

GAAP operating expenses in the fourth quarter were $10.7 million, and for the year, $45 million.

King also provided an update regarding a potential acquisition of the company by Barcelona, Spain-based Grupo Ferrer International. In February 2016, the two companies entered into a non-binding letter of intent for Ferrer to buy all of Alexza’s outstanding stock.

In addition to working through the possible acquisition, the company is focused on partnering U.S. commercial rights for Adasuve.

“It’s also clear that Adasuve works extremely well,” King said in the conference call, “in fact, perhaps even better than our clinical trials exhibited, as we’re not seeing and hearing the real world use of the product and receiving the feedback from physicians, clinicians, and nurses how it can significantly help patients. Physican by physician, patient by patient, caregiver by caregiver, Adasuve is changing medicine in treating these patients. This is very exciting and Adasuve is making a difference. At the same time, we appreciate the realities of where we are as a company and what strategic options might be available to us.”

Alexza is currently trading for $0.52. Shares traded on April 7, 2015 for $2.07, dropped to $1.02 on May 19, rose slightly to $1.50 on Sept. 21, then plunged to $0.28 on Feb. 25, 2016. Shares recovered slightly to $0.74 on Mar. 24 before its most recent drop.

Of the company, Investorplace wrote today, “ALXA investors are clearly nervous about the company’s ability to stay listed on the Nasdaq. The company has been in danger of delisting since Jun 2015, though it did receive a determination in March that it could stay on the Nasdaq should it comply with several minimum standards. One of these is a minimum $35 million market value by June 14 of this year—a now more difficult feat considering the company was worth $18 million before Tuesday’s 30 percent premarket haircut.”

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