FLEMINGTON, N.J., Aug. 14, 2014 (GLOBE NEWSWIRE) -- Arno Therapeutics, Inc. (OTCQB:ARNI), a clinical stage biopharmaceutical company focused on the development of oncology therapeutics, today announced financial results for the second quarter of 2014 and provided an update on recent clinical developments.
Recent Highlights
- Commenced enrollment of patients in a Phase I/II trial of onapristone in men with advanced, castration resistant prostate cancer (CRPC) who have failed treatment with abiraterone or enzalutamide;
- Continued to actively enroll patients in a Phase I trial in women with progesterone receptor (PR) expressing tumors; and
- Presented two posters at the 2014 ASCO Annual Meeting describing the objectives, methods and study designs of Arno's two ongoing clinical studies.
"Our top priority at Arno is moving onapristone into the next phase of clinical development as efficiently as possible," said Alexander Zukiwski, MD, Interim CEO of Arno Therapeutics. "Enrollment in our Phase I trial in France to evaluate onapristone in post-menopausal women with PR positive tumors has advanced quickly since the enrollment of our first patient in January. All of the sites in France are actively enrolling patients, and we continue to expect that the study will be fully enrolled by the end of the year. With the progress made to date, we expect that we will be able to determine the recommended Phase II dose in the near future. The Phase I/II trial in men with castration resistant prostate cancer taking place in the United Kingdom also continues to enroll patients who have failed prior hormone therapy."
Dr. Zukiwski added, "We believe that Arno is the leader in the development of anti-progestins for the treatment of cancer, and that onapristone is the logical and viable next step in the evolution of anti-cancer hormone therapies. Our team is working diligently to position Arno for maximum long-term success and value creation for our stakeholders, and to capitalize on our recent progress with a goal of moving onapristone into Phase II clinical trials."
Second Quarter 2014 Financial Results
For the three months ended June 30, 2014, Arno reported net income of $3.5 million, or $0.17 per share, which includes non-cash income of $9.3 million related to the decrease in derivative liability of common stock warrants, and $1.3 million of non-cash stock based compensation expense. Adjusting for these non-cash items, which resulted in a gain of $8.0 million, the Company reported a net loss of approximately $4.5 million, or $0.23 per share on a non-GAAP basis. This compares to second quarter 2013 net loss of $11.3 million, or $2.35 per share on a GAAP basis. Adjusted second quarter 2013 net loss was approximately $3.2 million, or $0.65 per share on a non-GAAP basis, which includes the same non-cash adjustments plus $1.9 million related to non-cash interest expense from debentures that were converted into common stock in 2013.
For the six months ended June 30, 2014, Arno reported net income of $3.0 million, or $0.15 per share, which includes non-cash income of $14.9 million for the decrease in derivative liability of stock warrants, and $2.4 million of non-cash stock based compensation expense. Adjusting for these non-cash items, which resulted in a benefit of $12.5 million, net loss for the quarter was approximately $9.5 million, or $0.47 per share on a non-GAAP basis. This compares to first half 2013 net loss of $12.2 million, or $2.61 per share on a GAAP basis, and an adjusted first half 2013 non-GAAP net loss of approximately $6.1 million, or $1.29 per share, when considering the same non-cash adjustments plus $4.5 million related to non-cash interest expense from debentures that were converted into common stock in 2013.
The primary factor for the $1.3 million year-over-year increase in adjusted (non-GAAP) net loss in the second quarter of 2014, as well as the $3.4 million increase in adjusted (non-GAAP) net loss for the first six months of 2014, was increased R&D expenses, primarily associated with the 2014 initiation of two Phase I clinical trials for Arno's lead compound, onapristone.
Non-GAAP Measures
Arno believes it prepared its consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) and pursuant to accounting requirements of the Securities and Exchange Commission. In an effort to provide investors with additional information regarding Arno's results and to provide a meaningful period-over-period comparison of Arno's financial performance, the Company sometimes uses non-GAAP financial measures as defined by the Securities and Exchange Commission. The differences between the GAAP and non-GAAP financial measures are reconciled in schedule below. In presenting comparable results, the Company discloses non-GAAP financial measures when it believes such measures will be useful to investors in evaluating Arno's underlying business performance. Management uses the non-GAAP financial measures to evaluate Arno's financial performance against internal budgets and targets. In addition, management internally reviews Arno's results excluding the impact of certain items, as it believes that these non-GAAP financial measures are useful for evaluating Arno's core operating results and facilitating comparison across reporting periods. Importantly, Arno believes non-GAAP financial measures should be considered in addition to, and not in lieu of, GAAP financial measures. Arno's non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.
About Onapristone
Onapristone has the potential to be the first approved anti-progestin for oncology indications and provide chemotherapy-sparing treatment to cancer patients who express a specific biomarker, as detected by a companion diagnostic under development. Onapristone is an oral, anti-progestin hormone blocker that has been shown in previous clinical trials to have anti-tumor activity in patients with breast cancer. Onapristone appears to have a unique ability to block the activation of the progesterone receptor, which is believed to be a mechanism that may inhibit the growth of breast, endometrial and other tumors. The activated form of the progesterone receptor (APR) has the potential to function as a biomarker of anti-progestin activity.
About Arno Therapeutics
Arno Therapeutics is a clinical stage biopharmaceutical company developing innovative products for the treatment of cancer. Arno has exclusive worldwide rights to develop and market three innovative anti-cancer product candidates. These compounds are in clinical or preclinical development as product candidates to treat hematologic malignancies and solid tumors. For more information about the company, please visit www.arnothera.com .
Forward-Looking Statements
This press release contains forward-looking statements that involve substantial risks and uncertainties. These statements are often, but not always, made through the use of words or phrases such as "anticipates," "expects," "plans," "believes," "intends," and similar words or phrases. These forward-looking statements include, without limitation, statements regarding the expected timing of completion of enrollment and recommended dose determination for Arno's Phase I clinical trial of onapristone in France, as well as other timing, progress and anticipated results of the clinical development of onapristone, including the ability to identify and treat those patients most likely to benefit from onapristone, as well as Arno's strategy, future operations, outlook, milestones, future financial position, future financial results, plans and objectives. Arno may not actually achieve these plans, intentions or expectations and Arno cautions investors not to place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. Various important factors could cause actual results or events to differ materially from the forward-looking statements that we make. Such factors include, among others, risks that the results of clinical trials will not support our claims or beliefs concerning the effectiveness of onapristone or any of our other product candidates, our ability to successfully develop a diagnostic to identify APR tumors, our ability to finance the development of our product candidates, regulatory risks, and our reliance on third party researchers and other collaborators. Additional risks are described in the company's Annual Report on Form 10-K for the year ended December 31, 2013, and in its Quarterly Report on Form 10-Q for the period ended June 30, 2014. Arno is providing this information as of the date of this press release and does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise.
| Arno Therapeutics, Inc. | ||||
| Condensed Statements of Operations | ||||
| (Amounts in thousands, except per share data) | ||||
| Three Months Ended | Six Months Ended | |||
| June 30, | June 30, | |||
| (Unaudited) | (Unaudited) | |||
| 2014 | 2013 | 2014 | 2013 | |
| Revenue | $ – | $ – | $ – | $ – |
| Operating expenses: | ||||
| Research and development | 4,083 | 2,742 | 8,518 | 5,735 |
| General and administrative | 1,680 | 668 | 3,409 | 1,520 |
| Total operating expenses | 5,763 | 3,410 | 11,927 | 7,255 |
| Loss from operations | (5,763) | (3,410) | (11,927) | (7,255) |
| Interest income/(expense), net | 13 | (1,856) | 24 | (4,010) |
| Other income/(expense), net | 9,245 | (6,039) | 14,951 | (974) |
| Net income/(loss) | $3,495 | $(11,305) | $3,048 | $(12,239) |
| Net income/(loss) per share – basic | $0.17 | $ (2.35) | $0.15 | $ (2.61) |
| Shares used in computation of net loss per share – basic | 20,370 | 4,815 | 20,370 | 4,684 |
| Net income/(loss) per share – diluted | $0.14 | $ (2.35) | $0.12 | $ (2.61) |
| Shares used in computation of net loss per share – diluted | 24,803 | 4,815 | 24,805 | 4,684 |
| Balance Sheet Data | ||
| (Amounts in thousands) | ||
| June 30, | December 31, | |
| 2014 | 2013 | |
| (Unaudited) | ||
| Cash and cash equivalents | $15,845 | $26,774 |
| Total assets | $15,948 | $26,883 |
| Current liabilities | $2,483 | $3,901 |
| Accumulated deficit | $(86,510) | $(89,558) |
| Stockholders' deficit | $(7,417) | $(12,883) |
| Reconciliation Between Reported (GAAP) and Adjusted Net Income/(Loss) (Non-GAAP) | ||
| (Amounts in thousands, except per share data) | ||
| Three Months Ended | ||
| June 30, | ||
| 2014 | 2013 | |
| Net income/(loss), as reported (GAAP) | $3,495 | $(11,305) |
| Adjustments for reconciled items: | ||
| Interest expense, non-cash | -- | 1,859 |
| Change in fair value of derivative liability, non-cash | (9,276) | 6,045 |
| Stock based compensation, non-cash | 1,253 | 235 |
| Adjusted net income/(loss) (non-GAAP) | $ (4,528) | $ (3,166) |
| Net income/(loss) per share - basic, as reported (GAAP) | $0.17 | $ (2.35) |
| Adjustments for reconciled items: | ||
| Interest expense, non-cash | -- | 0.39 |
| Change in fair value of derivative liability, non-cash | (0.46) | 1.26 |
| Stock based compensation, non-cash | 0.06 | 0.05 |
| Adjusted net income/(loss) per share - basic (non-GAAP) | $ (0.23) | $ (0.65) |
| Six Months Ended | ||
| June 30, | ||
| 2014 | 2013 | |
| Net income/(loss), as reported (GAAP) | $3,048 | $(12,239) |
| Adjustments for reconciled items: | ||
| Interest expense, non-cash | -- | 4,497 |
| Change in fair value of derivative liability, non-cash | (14,983) | 981 |
| Stock based compensation, non-cash | 2,418 | 699 |
| Adjusted net income/(loss) (non-GAAP) | $ (9,517) | $ (6,062) |
| Net income/(loss) per share - basic, as reported (GAAP) | $0.15 | $ (2.61) |
| Adjustments for reconciled items: | ||
| Interest expense, non-cash | -- | 0.96 |
| Change in fair value of derivative liability, non-cash | (0.74) | 0.21 |
| Stock based compensation, non-cash | 0.12 | 0.15 |
| Adjusted net income/(loss) per share - basic (non-GAAP) | $ (0.47) | $ (1.29) |
The Ruth Group Lee Roth (investors) (646) 536-7012 Kirsten Thomas (media) (646) 536-7014 Arno Therapeutics Lawrence Kenyon (862) 703-7171
