Insmed Reports Third Quarter 2017 Financial Results and Provides Business Update
- During the third quarter, the Company announced positive top-line results from its Phase 3 CONVERT Study of ALIS (amikacin liposome inhalation suspension) in patients with NTM lung disease caused by MAC, a rare, progressive, destructive lung infection
- Study met primary endpoint of culture conversion (p < 0.0001)
Insmedplans to pursue accelerated approval and request priority review
- Company enhanced cash position by
$378 millionthrough public offering of stock
"The positive top-line results from CONVERT we announced during the third quarter represent a significant step forward in fulling our mission of transforming the lives of patients with rare diseases. Our top priority is to complete the NDA for a U.S. regulatory filing with the FDA, under subpart H," said
- CONVERT study met its primary endpoint of culture conversion by Month 6 with statistical and clinical significance.
- Study demonstrated that the addition of ALIS to guideline-based therapy (GBT) eliminated evidence of nontuberculous mycobacteria (NTM) lung disease caused by Mycobacterium avium complex (MAC) in sputum by Month 6 in 29% of patients, compared to 9% of patients on GBT alone (p < 0.0001).
Insmedplans to pursue accelerated approval for ALIS under subpart H based on the data from the CONVERT study, which will be reviewed by the Division of Anti-Infective Products. FDApreviously granted product Breakthrough Therapy designation and fast track status and designated ALIS as a qualified infectious disease product (QIDP) under the Generating Antibiotic Incentives Now (GAIN) Act.
Safety and Tolerability
- Serious treatment emergent adverse events were similar between treatment arms.
- Overall dropout rate was 16.1%, with an 8.9% dropout rate in the GBT arm and a 19.6% rate in the ALIS plus GBT arm.
Third Quarter Financial Results
For the third quarter of 2017, Insmed reported a net loss of $45.2 million, or $0.69 per share, compared with a net loss of $37.8 million, or $0.61 per share, for the third quarter of 2016.
Research and development expenses were $26.7 million for the third quarter of 2017, compared with $23.4 million for the third quarter of 2016. The increase was primarily due to higher expenses related to INS1007 as compared to the prior year period.
General and administrative expenses for the third quarter of 2017 were $17.4 million, compared with $13.7 million for the third quarter of 2016. The increase was primarily due to higher expenses related to our pre-commercial planning activities for ALIS and higher compensation and related expenses due to an increase in headcount, as compared to the prior year period.
Balance Sheet and Other Financial Highlights
Insmed will host a conference call beginning today at 8:30 AM Eastern Time. Shareholders and other interested parties may participate in the conference call by dialing (844) 707-0669 (domestic) or (703) 639-1223 (international) and referencing conference ID number 5699819. The call will also be webcast live on the internet on the company's website at www.insmed.com.
A replay of the conference call will be accessible approximately two hours after its completion through November 9, 2017 by dialing (855) 859-2056 (domestic) or (404) 537-3406 (international) and referencing conference ID number 5699819. A webcast of the call will also be archived for 90 days under the Investor Relations section of the company's website at www.insmed.com.
Non-GAAP Financial Measures
In addition to the United States generally accepted accounting principles (GAAP) results, this earnings release includes cash-based operating expenses, a non-GAAP financial measure, which Insmed defines as total operating expenses excluding stock-based compensation expense and depreciation expense. A reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure is presented in the table attached to this press release.
Management believes that this non-GAAP financial measure is useful to both management and investors in analyzing our ongoing business and operating performance. Management believes that providing non-GAAP information to investors, in addition to the GAAP presentation, allows investors to view our financial results in the way that management views financial results. Management does not intend the presentation of this non-GAAP financial measure to be considered in isolation or as a substitute for results prepared in accordance with GAAP. In addition, this non-GAAP financial measure may differ from similarly named measures used by other companies.
About NTM Lung Disease
NTM lung disease is a rare and serious disorder associated with increased rates of morbidity and mortality. There is an increasing prevalence of lung disease caused by NTM, and we believe it is an emerging public
health concern worldwide. Patients with NTM lung disease may experience a multitude of symptoms such as fever, weight loss, cough, lack of appetite, night sweats, blood in the sputum, and fatigue. Patients with NTM lung disease frequently require lengthy hospital stays to manage their condition. We are not aware of any approved inhaled therapies specifically indicated for refractory NTM lung disease caused by MAC in
The prevalence of human disease attributable to NTM has increased over the past two decades. In a decade long study (1997 to 2007), researchers found that
the prevalence of NTM lung disease in the
ALIS is a novel, inhaled, once-daily formulation of amikacin that is in late-stage clinical development for adult patients with
treatment-refractory NTM lung disease caused by MAC. Amikacin solution for parenteral administration is an established drug that has activity against a variety of NTM; however, its use is limited by the need to administer it intravenously and by toxicity to hearing, balance, and kidney function.
CONVERT is a randomized, open-label, global Phase 3 trial designed to confirm the culture conversion results seen in Insmed's Phase 2 clinical trial of ALIS in patients with refractory NTM lung disease caused by MAC. CONVERT is being conducted in 18 countries at more than 125 sites. The primary efficacy endpoint is the proportion of patients who achieve culture conversion at Month 6 in the ALIS plus GBT arm compared to the GBT-only arm. Patients who achieve culture conversion by Month 6 will continue in the CONVERT study for an additional 12 months of treatment following the first monthly negative sputum culture. Patients who do not culture convert have the option of enrolling in our INS-312 study. INS-312 is a single-arm open-label study where patients will receive ALIS plus GBT for 12 months.
This press release contains forward looking statements. "Forward-looking statements," as that term is defined in the Private Securities Litigation Reform Act of 1995, are statements that are not historical facts and involve a number of risks and uncertainties. Words herein such as "may," "will," "should," "could," "would," "expects," "plans," "anticipates," "believes," "estimates," "projects," "predicts," "intends," "potential," "continues," and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) may identify forward-looking statements.
The forward-looking statements in this press release are based upon the Company's current expectations and beliefs, and involve known and unknown risks, uncertainties and other factors, which may cause the Company's actual results, performance and achievements and the timing of certain events to differ materially from the results, performance, achievements or timing discussed, projected, anticipated or indicated in any forward-looking statements. Such factors include, among others: risks that the full six-month data from the CONVERT study or subsequent data from the remainder of the study's treatment and off-treatment phases will not be consistent with the top-line six-month results of
the study; uncertainties in the research and development of our existing product candidates, including due to delays in data readouts, such as the full data from the CONVERT study, patient enrollment and retention or failure of our preclinical studies or clinical trials to satisfy pre-established endpoints, including secondary endpoints in the CONVERT study and endpoints in the INS-312 study; lack of safety and efficacy of our product candidates; failure to develop, or to license for development, additional product candidates, including a failure to attract experienced third-party collaborators; failure to obtain, or delays in obtaining, regulatory approval from the
For additional information about the risks and uncertainties that may affect our business, please see the factors discussed in Item 1A, "Risk Factors," in the Company's Report on Form 10-Q for the quarter ending
The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date of this press release. The Company disclaims any obligation, except as specifically required by law and the rules of the
Financial Statements and Reconciliation to Follow
|Consolidated Balance Sheets|
|(in thousands, except par value and share data)|
|As of||As of|
|Cash and cash equivalents||$||430,678||$||162,591|
|Prepaid expenses and other current assets||6,802||5,816|
|Total current assets||437,480||168,407|
|In-process research and development||58,200||58,200|
|Fixed assets, net||8,975||10,020|
|Liabilities and shareholders' equity|
|Other current liabilities||616||728|
|Total current liabilities||28,766||27,989|
|Other long-term liabilities||747||693|
|Common stock, |
|authorized shares, 76,568,368 and 62,019,889 issued and outstanding shares at ||766||620|
|Additional paid-in capital||1,313,006||919,164|
|Accumulated other comprehensive income (loss)||34||(65||)|
|Total shareholders' equity||421,305||154,483|
|Total liabilities and shareholders' equity||$||506,206||$||237,956|
|Consolidated Statements of Net Loss|
|(in thousands, except per share data)|
| Three Months Ended || Nine Months Ended |
|Research and development||26,675||23,433||75,800||67,851|
|General and administrative||17,408||13,716||47,767||38,498|
|Total operating expenses||44,083||37,149||123,567||106,349|
|Other income, net||101||45||206||92|
|Loss before income taxes||(45,152||)||(37,735||)||(127,171||)||(107,800||)|
|Income tax provision||27||25||94||71|
|Basic and diluted net loss per share||$||(0.69||)||$||(0.61||)||$||(2.01||)||$||(1.74||)|
|Weighted average basic and diluted common shares outstanding||65,312||61,878||63,199||61,871|
|Reconciliation of GAAP to Non-GAAP Results|
| Three Months Ended || Nine Months Ended |
|Operating expenses reconciliation:|
|Total operating expenses - GAAP||$||44,083||$||37,149||$||123,567||$||106,349|
|Stock-based compensation expense||(4,741||)||(5,045||)||(13,332||)||(13,879||)|
|Cash-based operating expenses - Non-GAAP||$||38,628||$||31,430||$||108,067||$||90,714|
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