Insmed Reports Third Quarter 2018 Financial Results and Provides Business Update
—Quarter Highlighted by U.S. FDA Approval of ARIKAYCE® (amikacin liposome inhalation suspension), Followed by Immediate Launch—
As previously announced,
Recent Corporate Developments
Commercial Launch of
Pivotal Phase 3 CONVERT Study Data Published in
In September, results from the CONVERT study were published online in the
New Data Presented at Infectious Disease Week (IDWeek) 2018 and CHEST Annual Meeting
Patent Protection in
In October, the Japanese Patent Office issued its eighth patent to
Third Quarter Financial Results
For the third quarter of 2018, Insmed reported a net loss of $87.7 million, or $1.14 per share, compared with a net loss of $45.2 million, or $0.69 per share, for the third quarter of 2017.
Research and development expenses were $39.5 million for the third quarter of 2018, compared with $26.7 million for the third quarter of 2017. The increase is primarily due to an increase in external manufacturing expenses for ARIKAYCE production-related activities and higher compensation and related expenses due to an increase in headcount.
General and administrative expenses for the third quarter of 2018 were $44.4 million, compared with $17.4 million for the third quarter of 2017. The increase is primarily due to an increase in headcount, including the hiring of our field force, and higher consulting expenses related to pre-commercial planning activities in preparation for the launch of ARIKAYCE.
Balance Sheet and Cash Guidance
The Company is investing in the following key activities in 2018: (i) the build-out of the commercial organization to support the U.S. launch and potential global expansion activities for ARIKAYCE; (ii) manufacturing of commercial inventory and build-out of an additional third-party manufacturing facility; and (iii) clinical trials for ARIKAYCE and the WILLOW study, our Phase 2 development program for INS1007, along with advancement of other pipeline programs. As a result of these activities,
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 2556408. The call will also be webcast live 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
Non-GAAP Financial Measures
In addition to the U.S. 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 MAC Lung Disease
Mycobacterium avium complex (MAC) lung disease is a rare and serious disorder that can significantly increase morbidity and mortality. Patients with MAC lung disease can experience a range of symptoms that often worsen over time, including chronic cough, dyspnea, fatigue, fever, weight loss, and chest pain. In some cases, MAC lung disease can cause severe, even permanent damage to the lungs, and can be fatal.
MAC lung disease is an emerging public health concern worldwide with significant unmet needs. Current guideline-based treatment involves the use of multi-drug regimens that are not specifically approved for MAC lung disease. The course of treatment is often two years or more and is inadequate in treating the disease in many patients.
About ARIKAYCE®(amikacin liposome inhalation suspension)
ARIKAYCE is the first and only
About PARI Pharma and the Lamira™ Nebulizer System
ARIKAYCE® (amikacin liposome inhalation suspension) is delivered by a novel inhalation device, the Lamira™ Nebulizer System, developed by PARI. Lamira™ is a quiet, portable nebulizer that enables efficient aerosolization of liquid medications, including liposomal formulations such as ARIKAYCE, via a vibrating, perforated membrane. Based on PARI's 100-year history working with aerosols, PARI is dedicated to advancing inhalation therapies by developing innovative delivery platforms and new pharmaceutical formulations that work together to improve patient care.
About CONVERT (INS-212) and INS-312
CONVERT is a randomized, open-label, global Phase 3 trial designed to confirm the sputum culture conversion results seen in
This press release contains forward-looking statements that involve substantial risks and uncertainties. "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 risks, uncertainties and other factors include, among others, the following: failure to successfully commercialize or maintain US approval for ARIKAYCE, the Company’s only approved product; uncertainties in the degree of market acceptance of ARIKAYCE by physicians, patients, third-party payers and others in the healthcare community; the Company’s inability to obtain full approval of ARIKAYCE from the
The Company may not actually achieve the results, plans, intentions or expectations indicated by the Company’s forward-looking statements because, by their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. For additional information about the risks and uncertainties that may affect the Company’s business, please see the factors discussed in Item 1A, "Risk Factors," in the Company’s Quarterly Report on Form 10-Q for the quarter ended
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 Follow
|Consolidated Balance Sheets|
|(in thousands, except par value and share data)|
|As of||As of|
|September 30, 2018||December 31, 2017|
|Cash and cash equivalents||$||567,574||$||381,165|
|Prepaid expenses and other current assets||9,921||8,279|
|Total current assets||577,495||389,444|
|Fixed assets, net||19,526||12,432|
|Liabilities and shareholders' equity|
|Other current liabilities||472||646|
|Total current liabilities||57,419||44,656|
|Long-term debt, net||311,861||55,567|
|Other long-term liabilities||826||765|
|Common stock, $0.01 par value; 500,000,000 authorized shares, 77,085,715 and 76,610,508 issued and outstanding shares at September 30, 2018 and December 31, 2017, respectively||771||766|
|Additional paid-in capital||1,481,205||1,318,181|
|Accumulated other comprehensive income (loss)||20||(3||)|
|Total shareholders' equity||291,407||361,059|
|Total liabilities and shareholders' equity||$||661,513||$||462,047|
|Consolidated Statements of Net Loss|
|(in thousands, except per share data)|
|Three Months Ended September 30,||Nine Months Ended September 30,|
|Research and development||39,538||26,675||105,358||75,800|
|General and administrative||44,445||17,408||114,258||47,767|
|Total operating expenses||83,983||44,083||219,616||123,567|
|Loss on extingushment of debt||-||-||(2,209||)||-|
|Other income, net||220||101||550||206|
|Loss before income taxes||(87,697||)||(45,152||)||(232,570||)||(127,171||)|
|Provision for income taxes||46||27||134||94|
|Basic and diluted net loss per share||$||(1.14||)||$||(0.69||)||$||(3.03||)||$||(2.01||)|
|Weighted average basic and diluted common shares outstanding||77,066||65,312||76,819||63,199|
|Reconciliation of GAAP to Non-GAAP Results|
|Three Months Ended September 30,||Nine Months Ended September 30,|
|Total operating expenses - GAAP||$||83,983||$||44,083||$||219,616||$||123,567|
|Stock-based compensation expense||(7,902||)||(4,741||)||(20,205||)||(13,332||)|
|Cash-based operating expenses - Non-GAAP||$||75,127||$||38,628||$||196,759||$||108,067|
Source: Insmed, Inc.