- Continued enrollment in the two Phase 3 safety and efficacy clinical trials of ZX008 (low-dose fenfluramine) (Studies 1501 and 1502) in North America, Europe and Australia, with top-line results anticipated in Q2 2017.
- Company remains on-track for potential regulatory submissions by year-end 2017.
- Initiated Cohort 1 (pharmacokinetic assessment) in Study 1504, a trial evaluating the pharmacokinetics, efficacy and safety of ZX008 in patients who have responded poorly to a stiripentol regimen. Cohort 2 (efficacy and safety assessment) is expected to begin by the end of this year.
- Effectiveness and safety results of ZX008 from the ongoing open-label prospective study of patients with Dravet syndrome published in the European Journal of Neurology. The study demonstrated a robust median reduction in seizures of 75% (range, 28-100%) during the treatment period with no cardiovascular abnormalities. Schoonjans, A. S., Paelinck, B. P., Marchau, F., Gunning, B., Gammaitoni, A., Galer, B. S., Lagae, L. and Ceulemans, B. (2016). Eur J Neurol. doi:10.1111/ene.13195
- Presented further data at the 12 th European Congress on Epileptology related to understanding the burden Dravet syndrome causes for the patient and their family, and also on identifying clinically relevant outcome measures to assess the quality of life impact on Dravet syndrome patients and their caregivers.
- Multiple abstracts accepted for presentation at the upcoming American Epilepsy Society Annual Meeting (December 2-6, 2016) highlighting new clinical and pre-clinical findings, including an interim analysis of an on-going investigator initiated open-label Phase 2 trial in Lennox Gastaut syndrome.
- Completed the nine-months ended September 30, 2016, with $109.9 million in cash and cash equivalents. Zogenix expects its cash runway to extend through 2017.
Third Quarter 2016 Financial Results Compared to Third Quarter 2015 Financial ResultsAs a result of the sale of the Zohydro ER business in April 2015, all Zohydro ER revenue and expenses have been excluded from continuing operations for all periods herein and reported as discontinued operations.
- Total revenue for the third quarter of 2016 was $6.6 million, consisting almost entirely of contract manufacturing revenue. This compared with total revenue of $9.1 million in the same quarter last year, which included $8.9 million of contract manufacturing revenue. The decrease in contract manufacturing revenue in the third quarter of 2016 was due primarily to a decrease in deliveries to Endo International Plc under the supply agreement between the two companies.
- Third quarter 2016 research and development expenses totaled $10.1 million, up from $7.9 million in the third quarter a year ago, as the Company progressed its two Phase 3 clinical trials for ZX008, continuing enrollment in Study 1501 and Study 1502.
- Third quarter 2016 selling, general and administrative expenses totaled $6.5 million, compared with $5.7 million in the third quarter a year ago.
- Net loss from continuing operations for the third quarter of 2016 was $16.6 million, compared with $13.0 million in the third quarter a year ago.
- Net loss from discontinued operations was $0.4 million for the third quarter of 2016, compared with net loss of $1.6 million in the third quarter a year ago.
- Total net loss for the third quarter of 2016 was $17.0 million, or $0.69 per share, compared with net loss of $14.6 million, or $0.65 per share, for the third quarter a year ago.
- Total revenue for the nine-months ended September 30, 2016 was $17.9 million, consisting almost entirely of contract manufacturing revenue. This compared with total revenue of $21.1 million in the same period last year, which included $19.0 million of contract manufacturing revenue and $2.1 million of service and other product revenue.
- Research and development expenses for the nine months ended September 30, 2016 totaled $28.4 million, up from $19.3 million in the year ago period, as the Company enrolled patients into two Phase 3 clinical trials for ZX008.
- Selling, general and administrative expense for the nine months ended September 30, 2016 totaled $19.5 million, flat as compared to the same period a year ago.
- Net loss from continuing operations was $45.1 million for the nine months ended September 30, 2016, compared with $29.8 million in the same period a year ago.
- Net loss from discontinued operations was $1.1 million for the nine months ended September 30, 2016, compared to net income of $64.8 million in the same period a year ago, which included the net gain on the sale of the Zohydro ER business.
- Total net loss for the nine months ended September 30, 2016 was $46.2 million, or $1.87 per basic share and fully diluted, compared with net income of $35.0 million, or $1.72 per share, for the same period a year ago, which included the net gain on the sale of the Zohydro ER business.
- Cash and cash equivalents at September 30, 2016 totaled $109.9 million, as compared to $155.3 million at December 31, 2015.
- Research and development expenses are now expected to be $42-44 million compared to prior guidance of $54-$59 million, reflecting slower site initiation and ramp-up of ZX008 clinical studies than expected;
- Selling, general and administrative expenses are unchanged and expected to be $25-27 million; and
- Contract manufacturing revenue from the supply of Sumavel DosePro to Endo is expected at a low single-digit markup over cost of contract manufacturing.
For more information, visit www.zogenix.com.Forward Looking Statements Zogenix cautions you that statements included in this press release that are not a description of historical facts are forward-looking statements. Words such as "believes," "anticipates," "plans," "expects," "indicates," "will," "intends," "potential," "suggests," "assuming," "designed" and similar expressions are intended to identify forward-looking statements. These statements are based on the company's current beliefs and expectations. These forward-looking statements include statements regarding ZX008's potential as a treatment for seizures associated with Dravet syndrome; the enrollment of patients in the two on-going Phase 3 clinical trials for ZX008; the timing of top line results for the two on-going Phase 3 clinical trials; the timing of any NDA submission; the timing of the commencement of Cohort 2 of Study 1504; the presentation of data at the American Epilepsy Society Annual Meeting ; and revised 2016 financial guidance. The inclusion of forward-looking statements should not be regarded as a representation by Zogenix that any of its plans will be achieved. Actual results may differ from those set forth in this release due to the risks and uncertainties inherent in Zogenix's business, including, without limitation: the uncertainties associated with the clinical development and regulatory approval of product candidates such as ZX008, including potential delays in the commencement, enrollment and completion of clinical trials; the potential that earlier clinical trials and studies may not be predictive of future results; Zogenix's reliance on third parties to conduct its clinical trials, enroll patients, manufacture its preclinical and clinical drug supplies and manufacture commercial supplies of its drug products, if approved; unexpected adverse side effects or inadequate therapeutic efficacy of ZX008 that could limit approval and/or commercialization, or that could result in recalls or product liability claims; Zogenix's ability to fully comply with numerous federal, state and local laws and regulatory requirements, as well as rules and regulations outside the United States, that apply to its product development activities; Fast Track designation may not result in an expedited regulatory review process; and other risks described in Zogenix's prior press releases as well as in public periodic filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and Zogenix undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement. This caution is made under the safe harbor provisions of Section 21E of the Private Securities Litigation Reform Act of 1995.
|Condensed Consolidated Statements of Operations|
|(in thousands, except per share amounts)|
|Three Months Ended||Nine Months Ended|
|September 30,||September 30,|
|Contract manufacturing revenue||$||6,345||$||8,860||$||17,537||$||19,044|
|Service and other product revenue||225||260||327||2,057|
|Cost of contract manufacturing||6,391||7,780||16,256||17,506|
|Research and development||10,076||7,919||28,447||19,310|
|Selling, general & administrative||6,538||5,696||19,506||19,547|
|Change in fair value of contingent consideration||200||(300||)||2,800||(1,900||)|
|Total operating expense||23,283||21,201||67,233||54,712|
|Loss from operations||(16,713||)||(12,081||)||(49,369||)||(33,611||)|
|Other income (expense):|
|Interest expense, net||(567||)||(718||)||(1,788||)||(2,259||)|
|Change in fair value of warrant liabilities||(356||)||(296||)||5,148||(861||)|
|Loss on short-term investments||-||(5,485||)||-||(5,485||)|
|Other (income) expense||25||103||2||(55||)|
|Total other income (expense)||(898||)||(6,396||)||3,362||(8,660||)|
|Net loss from continuing operations before income taxes||(17,611||)||(18,477||)||(46,007||)||(42,271||)|
|Income tax benefit||993||5,496||922||12,428|
|Net loss from continuing operations||(16,618||)||(12,981||)||(45,085||)||(29,843||)|
|Net income (loss) from discontinued operations, net of applicable tax||(379||)||(1,635||)||(1,130||)||64,829|
|Net income (loss)||$||(16,997||)||$||(14,616||)||$||(46,215||)||$||34,986|
|Net income (loss) per share, basic and diluted||$||(0.69||)||$||(0.65||)||$||(1.87||)||$||1.72|
|Weighted average shares outstanding, basic and diluted||24,791||22,613||24,780||20,332|
|Condensed Consolidated Balance Sheets|
|September 30,||December 31,|
|Cash and cash equivalents||$||109,866||$||155,349|
|Trade accounts receivable, net||6,524||1,396|
|Prepaid expenses and other current assets||9,467||5,518|
|Current assets of discontinued operations||6||208|
|Total current assets||135,275||184,503|
|Property and equipment, net||8,358||9,254|
|LIABILITIES AND STOCKHOLDERS' EQUITY|
|Common stock warrant liabilities||1,048||6,196|
|Long-term debt, current portion||-||6,321|
|Current liabilities of discontinued operations||1,203||2,906|
|Total current liabilities||14,125||29,986|
|Long-term debt, less current portion||21,845||15,899|
|Deferred revenue, less current portion||4,986||6,139|
|Contingent purchase consideration||53,800||51,000|
|Deferred income taxes||17,425||18,450|
|Other long-term liabilities||1,739||1,588|
|Total liabilities and stockholders' equity||$||255,837||$||305,822|
CONTACT:Investors:Andrew McDonaldFounding Partner, LifeSci Advisors LLC646-597-6987 | Andrew@lifesciadvisors.com