Quantcast
Last updated on April 18, 2014 at 9:25 EDT

Arena Pharmaceuticals Provides Corporate Update and Reports Second Quarter 2013 Financial Results

August 1, 2013

– Second Quarter Highlights Include US launch of BELVIQ® (lorcaserin HCl) CIV for Chronic Weight Management –

SAN DIEGO, Aug. 1, 2013 /PRNewswire/ — Arena Pharmaceuticals, Inc. (NASDAQ: ARNA) today provided a corporate update and reported financial results for the second quarter ended June 30, 2013.

“We are very encouraged by the positive response from patients and physicians since BELVIQ became available in US pharmacies on June 11,” said Jack Lief, Arena’s President and Chief Executive Officer. “While it is still early in the launch, the progress made to date reinforces the significant opportunity we see for BELVIQ in the medical management of overweight and obese patients.”

Recent Developments:

BELVIQ US Launch

  • In June 2013, Eisai launched BELVIQ in the United States.
  • Approximately 12,500 BELVIQ prescriptions have been filled between the availability of BELVIQ in US pharmacies on June 11 and July 19, 2013, according to IMS Health.
  • In the second quarter of 2013, Arena recognized $1.3 million in net product sales, which is 31.5% of Eisai’s net product sales of BELVIQ. Arena and Eisai currently recognize revenue of BELVIQ net product sales when Eisai ships product to its wholesalers.
  • Received $65 million in milestone payments from Eisai in connection with the US launch.

BELVIQ Rest of World

  • In July 2013, Arena’s wholly owned subsidiary, Arena Pharmaceuticals GmbH, and CY Biotech Company Ltd. (CYB) entered into a marketing and supply agreement for BELVIQ in Taiwan. Under the agreement, Arena granted CYB the rights to market and distribute BELVIQ in the territory for weight loss or weight management in obese and overweight patients, subject to regulatory approval of BELVIQ by the Taiwan Food and Drug Administration. Arena received a net upfront payment of $2 million from CYB.
  • Received a $0.5 million milestone payment from Eisai in connection with Eisai Limited’s June 2013 New Drug Submission for the marketing approval of BELVIQ( )in Canada.

BELVIQ Additional Developments

  • BELVIQ has been nominated for the 2013 Prix Galien USA Best Pharmaceutical Agent Award. The Prix Galien recognizes outstanding achievements in improving the human condition through the development of innovative therapies.
  • Presented a poster, Lorcaserin HCl Phase 3 Trials in Obese and Overweight Patients: Week 52 Outcomes for Those Achieving at Least 5% Weight Loss at Week 12, at the American Diabetes Association’s 73rd Scientific Sessions in Chicago, Illinois.
  • The American Medical Association recognized obesity as a disease state with multiple pathophysiological aspects requiring a range of interventions to advance obesity treatment and prevention.
  • Presented a poster, Association of Changes in Glycemic- and Lipid-Related Cardiometabolic Risk Factors and Weight Loss in Pooled Lorcaserin Phase 3 Studies of Obese and Overweight Patients Without Diabetes (BLOOM and BLOSSOM), at ENDO 2013, the Endocrine Society’s 95th Annual Meeting & Expo in San Francisco, California.

Research & Development

  • Completed dosing in a study to evaluate the safety, tolerability and pharmacokinetic properties of BELVIQ and phentermine when administered in combination. In addition, agreed on plans with Eisai to initiate a 12-week pilot study to evaluate the co-administration of BELVIQ and phentermine.
  • Completed dosing in a Phase 1 multiple-dose clinical trial of APD811, an oral drug candidate intended for the treatment of pulmonary arterial hypertension. Arena expects to announce results from the Phase 1 program this quarter.
  • Completed dosing in a Phase 1 clinical trial of APD334, an oral drug candidate intended for the treatment of autoimmune diseases. Preliminary results show a reduction in blood lymphocyte count, the desired benefit, and a slowing of heart rate, an undesirable adverse event seen with other drugs targeting the sphingosine 1-phosphate subtype 1 (S1P(1)) receptor. Further evaluation of the data is ongoing.

Second Quarter 2013 Financial Results

  • Revenues totaled $68.9 million, including $1.3 million in net product sales and $65.5 million in milestone payments.
  • Research and development expenses totaled $18.8 million.
  • General and administrative expenses totaled $8.6 million.
  • Net income allocable to common stockholders was $40.1 million, or $0.18 per share.
  • At June 30, 2013, cash and cash equivalents totaled $178.9 million and approximately 218.2 million shares of common stock were outstanding.

Scheduled Conference Call and Webcast

Arena will host a conference call and webcast to provide a corporate update and report second quarter 2013 financial results today at 8:30 a.m. Eastern Time (5:30 a.m. Pacific Time). The conference call may be accessed by dialing 877.643.7155 for domestic callers and 914.495.8552 for international callers. Please specify to the operator that you would like to join the “Arena Pharmaceuticals’ Second Quarter 2013 Financial Results Call.” The conference call will be webcast live under the investor relations section of Arena’s website at www.arenapharm.com and will be archived there for 30 days following the call. Please connect to Arena’s website several minutes prior to the start of the broadcast to ensure adequate time for any software download that may be necessary.

Upcoming Conference Participation

Arena is planning to participate at upcoming investment and industry conferences, including:

  • Bank of America Merrill Lynch Global Healthcare Conference, September 11-13, 2013, London, England
  • 49th Annual Meeting of the European Association for the Study of Diabetes, September 23-27, 2013, Barcelona, Spain
  • NewsMakers in the Biotech Industry, September 27, 2013, New York, New York
  • The Obesity Society’s Obesity Week 2013, November 11-16, 2013, Atlanta, Georgia

About BELVIQ(®) (lorcaserin HCl) CIV

BELVIQ (pronounced BEL-VEEK) is approved by the US Food and Drug Administration for chronic weight management, and is available by prescription in the United States. BELVIQ( )is believed to decrease food consumption and promote satiety by selectively activating serotonin 2C receptors in the brain. The exact mechanism of action is not known. For more information about BELVIQ, click here for the full Product Information or visit www.BELVIQ.com.

BELVIQ is indicated to be used along with a reduced-calorie diet and increased physical activity for chronic weight management in adult patients with an initial body mass index of:

  • 30 kg/m(2) or greater (obese), or
  • 27 kg/m(2) or greater (overweight) in the presence of at least one weight-related comorbid condition (e.g., hypertension, dyslipidemia, type 2 diabetes).

Limitations of Use:

  • The safety and efficacy of coadministration of BELVIQ with other products intended for weight loss including prescription drugs (e.g., phentermine), over-the-counter drugs, and herbal preparations have not been established.
  • The effect of BELVIQ on cardiovascular morbidity and mortality has not been established.

In clinical trials, the most common adverse reactions for patients without diabetes treated with BELVIQ were headache, dizziness, fatigue, nausea, dry mouth, and constipation. In patients with diabetes, the most common adverse reactions were hypoglycemia, headache, back pain, cough, and fatigue.

Arena has granted exclusive marketing and distribution rights to Eisai Inc. for most of North and South America, to Ildong Pharmaceutical Co., Ltd., for South Korea, and to CY Biotech Company Ltd. for Taiwan. Arena plans to enter into additional collaborations to commercialize BELVIQ outside of these territories.

About Arena Pharmaceuticals

Arena is a biopharmaceutical company focused on discovering, developing and commercializing novel drugs that target G protein-coupled receptors, or GPCRs, to address unmet medical needs. BELVIQ(®) (lorcaserin HCl), Arena’s internally discovered drug, is approved in the United States and is under review for regulatory approval in additional territories. Arena’s US operations are located in San Diego, California, and its operations outside of the United States, including its commercial manufacturing facility, are located in Zofingen, Switzerland. For more information, visit Arena’s website at www.arenapharm.com.

Arena Pharmaceuticals(®) and Arena(® )are registered service marks of Arena Pharmaceuticals, Inc. BELVIQ(®) is a registered trademark of Arena Pharmaceuticals GmbH.

Forward-Looking Statements

Certain statements in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements include statements about the advancement, therapeutic indication and use, safety, efficacy, mechanism of action, regulatory review and approval, and potential of BELVIQ; opportunity provided by BELVIQ, including in the medical management of patients; research and development relating to BELVIQ, including in combination with phentermine and related plans; rights and obligations under the marketing and supply agreement with CYB; the therapeutic indication, safety and efficacy of APD811 and APD334 and related expectations; plans to enter into additional collaborations and related strategy; and Arena’s focus, plans, goals, strategy, expectations, research and development programs, and ability to discover and develop compounds and commercialize drugs. For such statements, Arena claims the protection of the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from Arena’s expectations. Factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to, the following: risks related to commercializing drugs, including regulatory, manufacturing and supply issues and the availability and use of BELVIQ; cash and revenues generated from BELVIQ, including the impact of competition; Arena’s revenues will be based in part on management’s estimates, judgment and accounting policies, and incorrect estimates or disagreement regarding Arena’s estimates or accounting policies may result in changes to Arena’s guidance or previously reported results; the timing and outcome of regulatory review is uncertain, and BELVIQ may not be approved for marketing when expected or ever in combination with another drug, for another indication or using a different formulation or in any other territory for any indication; regulatory decisions in one territory may impact other regulatory decisions and Arena’s business prospects; government and commercial reimbursement and pricing decisions; risks related to relying on collaborative arrangements; the timing and receipt of payments and fees, if any, from collaborators; the entry into or modification or termination of collaborative arrangements; unexpected or unfavorable new data; nonclinical and clinical data is voluminous and detailed, and regulatory agencies may interpret or weigh the importance of data differently and reach different conclusions than Arena or others, request additional information, have additional recommendations or change their guidance or requirements before or after approval; data and other information related to any of Arena’s research and development may not meet regulatory requirements or otherwise be sufficient for further research and development, regulatory review or approval or continued marketing; Arena’s ability to obtain and defend patents; the timing, success and cost of Arena’s research and development; results of clinical trials and other studies are subject to different interpretations and may not be predictive of future results; clinical trials and other studies may not proceed at the time or in the manner expected or at all; having adequate funds; and satisfactory resolution of litigation or other disagreements with others. Additional factors that could cause actual results to differ materially from those stated or implied by Arena’s forward-looking statements are disclosed in Arena’s filings with the Securities and Exchange Commission. These forward-looking statements represent Arena’s judgment as of the time of this release. Arena disclaims any intent or obligation to update these forward-looking statements, other than as may be required under applicable law.

    Contact: Arena Pharmaceuticals, Inc.     Media Contact: Russo Partners

    Cindy McGee, Vice President,             David Schull, President

    Investor Relations & Alliance Management david.schull@russopartnersllc.com

    cmcgee@arenapharm.com                    858.717.2310

    858.453.7200, ext. 1479


                                                                                                                         Arena Pharmaceuticals, Inc.

                                                                                                               Condensed Consolidated Statements of Operations

                                                                                                                    (In thousands, except per share data)

                                                                                                                                                   Three months ended                                   Six months ended

                                                                                                                                                        June 30,                                            June 30,
                                                                                                                                                        --------                                          --------

                                                                                                                                                                 2013                                   2012                        2013                                   2012
                                                                                                                                                                 ----                                   ----                        ----                                   ----

                                                                                                                                                       (unaudited)                                      (unaudited)

    Revenues

    Net product sales                                                                                                                                          $1,319                                     $0                      $1,319                                     $0

    Eisai collaborative revenue                                                                                                                                66,465                                 20,919                      67,960                                 21,778

    Manufacturing services                                                                                                                                        973                                  1,029                       1,738                                  2,321

    Other collaborative revenue                                                                                                                                   170                                     29                         283                                     67
                                                                                                                                                                  ---                                    ---                         ---                                    ---

      Total revenues                                                                                                                                           68,927                                 21,977                      71,300                                 24,166

    Operating Costs & Expenses

    Cost of product sales                                                                                                                                         581                                      0                       1,054                                      0

    Cost of manufacturing services                                                                                                                              1,009                                    652                       2,654                                  1,443

    Research & development                                                                                                                                     18,828                                 14,076                      32,836                                 28,546

    General & administrative                                                                                                                                    8,603                                  5,216                      15,854                                 11,571

    Amortization of acquired technology & other intangibles                                                                                                         0                                    173                           0                                    349
                                                                                                                                                                  ---                                    ---                         ---                                    ---

      Total operating costs & expenses                                                                                                                         29,021                                 20,117                      52,398                                 41,909

    Interest & Other Income (Expense)

    Interest income                                                                                                                                                16                                     25                          40                                     40

    Interest expense                                                                                                                                           (1,778)                                (2,489)                     (3,565)                                (5,520)

    Gain (Loss) from valuation of derivative liabilities                                                                                                        2,142                                (16,770)                      6,001                                (19,145)

    Loss on extinguishment of debt                                                                                                                                  0                                 (4,668)                          0                                 (6,338)

    Other                                                                                                                                                        (186)                                   (57)                       (154)                                    30
                                                                                                                                                                 ----                                    ---                        ----                                    ---

      Total interest & other income (expense), net                                                                                                                194                                (23,959)                      2,322                                (30,933)
                                                                                                                                                                  ---                                -------                       -----                                -------

    Net income (loss)                                                                                                                                          40,100                                (22,099)                     21,224                                (48,676)

    Deemed dividend related to beneficial conversion                                                                                                                0                                      0                           0                                 (2,824)
            feature of convertible preferred stock

    Net income (loss) allocable to common stockholders                                                                                                        $40,100                               $(22,099)                    $21,224                               $(51,500)
                                                                                                                                                              =======                               ========                     =======                               ========

    Net income (loss) per share allocable to common
    stockholders:

    Basic                                                                                                                                                       $0.18                                 $(0.12)                      $0.10                                 $(0.29)
                                                                                                                                                                =====                                 ======                       =====                                 ======

    Diluted                                                                                                                                                     $0.18                                 $(0.12)                      $0.09                                 $(0.29)
                                                                                                                                                                =====                                 ======                       =====                                 ======

    Shares used in calculating net income (loss) per share
    allocable to common stockholders:

    Basic                                                                                                                                                     217,940                                190,272                     217,723                                177,243
                                                                                                                                                              =======                                =======                     =======                                =======

    Diluted                                                                                                                                                   224,528                                190,272                     224,551                                177,243
                                                                                                                                                              =======                                =======                     =======                                =======


                                                                             Arena Pharmaceuticals, Inc.

                                                                      Condensed Consolidated Balance Sheet Data

                                                                                    (In thousands)

                                                                                                                June 30, 2013          December 31, 2012
                                                                                                                -------------          -----------------

                                                                                                                 (unaudited)                               (1)

    Assets

      Cash & cash equivalents                                                                                                 $178,905               $156,091

      Accounts receivable                                                                                                        1,096                  5,556

      Inventory                                                                                                                  7,245                  6,058

      Prepaid expenses & other current assets                                                                                    3,174                  3,454

      Land, property & equipment, net                                                                                           73,898                 75,417

      Acquired technology & other non-current assets                                                                            13,636                 14,630
                                                                                                                                ------                 ------

           Total assets                                                                                                       $277,954               $261,206
                                                                                                                              ========               ========

    Liabilities & Stockholders' Equity

      Accounts payable & accrued liabilities                                                                                   $16,932                $10,210

      Total deferred revenues                                                                                                   53,183                 62,735

      Total derivative liabilities                                                                                               9,041                 15,042

      Total lease financing obligations & other long-term liabilities                                                           73,856                 74,580

      Total stockholders' equity                                                                                               124,942                 98,639
                                                                                                                               -------                 ------

           Total liabilities & stockholders' equity                                                                           $277,954               $261,206
                                                                                                                              ========               ========

(1) The Condensed Consolidated Balance Sheet Data has been derived from the audited financial statements as of that date.

SOURCE Arena Pharmaceuticals, Inc.


Source: PR Newswire