SOUTH SAN FRANCISCO, Calif., Nov. 5, 2015 (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 third quarter ended September 30, 2015.
During the quarter, significant progress was made toward the initiation of Achaogen's Phase 3 study in patients with complicated urinary tract infections (cUTI) and acute pyelonephritis (AP). This multi-national, randomized, double-blind study, entitled EPIC ( E valuating p lazomicin i n c UTI), is expected to create a substantial opportunity for plazomicin to address the unmet medical need arising from multi-drug resistant (MDR) infections of the urinary tract. EPIC is intended to serve as a single pivotal study supporting a new drug application (NDA) for plazomicin in the United States. The company remains on track to open clinical sites in Q4 2015 with top-line results and an NDA submission expected in the second half of 2017.
"I'm pleased with the progress made during the quarter to expedite plazomicin's path to market. Implementing the EPIC study is an exciting development for Achaogen as it will support plazomicin therapy in the substantial patient population with MDR cUTI, who are currently underserved, and will underpin the Company's plan for an NDA and subsequent commercialization in the U.S. and other markets," commented Dr. Kenneth Hillan, Achaogen's Chief Executive Officer.
Achaogen's CARE study, initiated in 2014, is a Phase 3 randomized controlled study of plazomicin in the treatment of patients with bloodstream infections (BSI) and pneumonia due to carbapenem-resistant Enterobacteriaceae (CRE). In the third quarter, the Company began to implement a second protocol amendment (AM2) that adds a single-arm cohort to the trial to enroll patients with confirmed CRE who are not eligible for the randomized study arms. Expanded eligibility in AM2 includes patients with cUTI/AP caused by CRE, a patient population with significant unmet medical need, as well as patients with infections resistant to treatment with colistin, patients with polymicrobial infections, and patients with lower APACHEII scores. The Company expects AM2 to further increase enrollment in the CARE trial and to generate important clinical data for plazomicin treatment in a broader range of patients with CRE infections, including cUTI.
On the corporate front, the Company bolstered its leadership team with the appointment of Mr. Blake Wise as its Chief Operating Officer. Mr. Wise, who will play an integral role in the Company's corporate growth trajectory, has over 20 years of experience and leadership in multiple areas of corporate and commercial strategy and operations, including most recently 13 years leading business units and sales and marketing activities at Genentech, a leading biotechnology company and member of the Roche Group. Additionally, Mr. Derek Bertocci, Chief Financial Officer (CFO), has decided to resign from his position to spend more time with his family and pursue other personal interests. Mr. Bertocci will continue to serve as the CFO until November 30, 2015 to help ensure a smooth transition. The Company will be evaluating prospective candidates to serve in the CFO role on an interim basis and will be initiating a formal search for a new CFO.
In a recent development, Achaogen appointed Dr. Michael Fischbach to its Board of Directors as a Class I Director, effective as of November 4th. "Michael's scientific leadership has led to breakthrough discoveries in the understanding of the human microbiome and I'm excited to welcome him to the Board as we continue our work on the discovery of differentiated antibacterials," commented Kenneth Hillan, Chief Executive Officer of Achaogen. Dr. Fischbach is currently an Associate Professor in the Department of Bioengineering and Therapeutic Sciences at UCSF. Prior to joining UCSF, Dr. Fischbach spent two years as an independent fellow at Massachusetts General Hospital. He is a member of the California Institute for Quantitative Biosciences (QB3). Dr. Fischbach is also the recipient of multiple awards, including the NIH Director's New Innovator Award, a Fellowship for Science and Engineering from the David and Lucille Packard Foundation, a Medical Research Award from the W.M. Keck Foundation, a Burroughs Wellcome Fund Investigators in the Pathogenesis of Infectious Disease award, a Glenn Award for Research in Biological Mechanisms of Aging, and the Young Investigator Grant for Probiotics Research from the Global Probiotics Council. Dr. Fischbach received his Ph.D. in chemistry from Harvard in 2007.
During the third quarter, the Company was awarded a contract for up to $4.5 million over three years from the National Institute of Allergy and Infectious Diseases, a division of the National Institutes of Health. This award will contribute funding to Achaogen's ongoing research focused on the discovery and development of LpxC inhibitors for the treatment of gram-negative bacterial infections, including those resistant to currently available antibiotics.
During the third quarter, five posters from the plazomicin pre-clinical development program that describe the spectrum of activity and key in vitro characteristics of plazomicin were presented at the Interscience Conference on Antimicrobial Agents and Chemotherapy. Three of these presentations highlighted the activity of plazomicin against isolates collected from the 2014 plazomicin surveillance program and from a single U.S. medical center. Two additional posters highlighted plazomicin's post-antibiotic effect and factors effecting susceptibility testing of plazomicin. Overall, plazomicin demonstrated potent in vitro activity against Enterobacteriaceae including extended spectrum beta-lactamase (ESBL)-producers, CRE, and strains resistant to currently marketed aminoglycosides. These data support the continued clinical development of plazomicin and its potential role in the treatment of infections due to multi-drug resistant Enterobacteriaceae.
Summary Financial Results for the Third Quarter Ended September 30, 2015
Cash, cash equivalents and short-term investments totaled $70.4 million at September 30, 2015 compared to $61.3 million at June 30, 2015, increasing as a result of borrowings of $15.0 million under the loan agreement announced during the third quarter, plus $1.3 million raised from the sale of equity, offset by the operating losses.
Revenue totaled $4.5 million for the third quarter of 2015 compared to $4.5 million for the comparable quarter of 2014. 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 $10.0 million for the third quarter of 2015, compared to $10.7 million for the comparable quarter of 2014. Decreased costs were primarily attributable to a $4.0 million development milestone license fee incurred in 2014, partially offset with the increased activities for our Phase 3 cUTI study of plazomicin, and other research programs other than plazomicin, and higher personnel-related costs.
General and administrative expenses increased to $3.0 million for the third quarter of 2015 compared to $2.2 million for the comparable quarter of 2014. Increased costs were primarily attributable to higher personnel-related costs and increased costs associated with becoming a public company.
Net loss totaled $8.8 million for the third quarter of 2015 compared to a net loss of $8.3 million for the comparable quarter of 2014.
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 lung, bloodstream, and urinary tract infections due to Enterobacteriaceae, including CRE. 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. For more information, please visit www.achaogen.com .
Forward-Looking Statements
This press release contains forward looking statements. All statements other than statements of historical facts contained herein 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 proposed Phase 3 cUTI trial and its ongoing Phase 3 CARE trial, the timing for completion of Achaogen's Phase 3 trials and submission of a new drug application to the U.S. Food and Drug Administration and plans with respect to development of Achaogen's LpxC inhibitor research and development program. 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 proposed Phase 3 cUTI trial and the ongoing Phase 3 CARE trial, 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 President and Chief Executive Officer; risks and uncertainties related to the acceptance of government funding for certain of Achaogen's programs, including the risk that the Biomedical Advanced Research and Development Authority 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 current and future reports filed with the Securities and Exchange Commission, including its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2015 and its Annual Report on Form 10-K for the fiscal year ended December 31, 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 | ||||
| (in thousands except share and per share data) | ||||
| (Unaudited) | ||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
| 2015 | 2014 | 2015 | 2014 | |
| Contract revenue | $ 4,476 | $ 4,520 | $ 21,397 | $ 15,711 |
| Operating expenses: | ||||
| Research and development | 10,000 | 10,678 | 27,967 | 23,478 |
| General and administrative | 3,006 | 2,175 | 9,119 | 7,138 |
| Total operating expenses | 13,006 | 12,853 | 37,086 | 30,616 |
| Loss from operations | (8,530) | (8,333) | (15,689) | (14,905) |
| Interest expense | (264) | -- | (264) | (397) |
| Other income (expense), net | 32 | 21 | 126 | (20) |
| Net loss | $ (8,762) | $ (8,312) | $ (15,827) | $ (15,322) |
| Basic and diluted net loss per common share | $ (0.48) | $ (0.47) | $ (0.88) | $ (1.18) |
| Weighted-average common shares outstanding used to calculate basic and diluted net loss per common share | 18,150,331 | 17,711,483 | 18,073,479 | 13,005,058 |
| Achaogen, Inc. | ||
| Condensed Consolidated Balance Sheets | ||
| (in thousands) | ||
| September 30 | December 31, | |
| 2015 | 2014 | |
| (unaudited) | ||
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $ 35,062 | $ 18,881 |
| Short-term investments | 35,376 | 44,798 |
| Contracts receivable | 3,904 | 5,234 |
| Prepaids and other current assets | 1,768 | 520 |
| Total current assets | 76,110 | 69,433 |
| Property and equipment, net | 836 | 725 |
| Restricted cash | 127 | 127 |
| Deposit and other assets | 297 | 37 |
| Total assets | $ 77,370 | $ 70,322 |
| Liabilities and stockholders' equity | ||
| Current liabilities: | ||
| Accounts payable | $ 5,333 | $ 2,122 |
| Accrued liabilities | 3,333 | 3,266 |
| Other current liabilities | 169 | 128 |
| Total current liabilities | 8,835 | 5,516 |
| Loan payable, net of discount | 14,405 | -- |
| Other long-term liabilities | 524 | 193 |
| Total liabilities | 23,764 | 5,709 |
| Stockholders' equity | 53,606 | 64,613 |
| Total liabilities and stockholders' equity | $ 77,370 | $ 70,322 |
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