Apellis Pharmaceuticals Reports First Quarter 2020 Financial Results
April 29, 2020
- Full Enrollment of Two Phase 3 Trials in Geographic Atrophy Expected in the Second Quarter of 2020
- Meetings with US and EU Regulators to Discuss Submissions in Paroxysmal Nocturnal Hemoglobinuria (PNH) Planned for the Second Quarter of 2020
- Completion of Enrollment in Phase 3 PRINCE Trial in Treatment-Naïve PNH Patients also Expected in Second Quarter of 2020
- Cash and Investments of $648 Million as of March 31, 2020
WALTHAM, Mass., April 29, 2020 (GLOBE NEWSWIRE) -- Apellis Pharmaceuticals, Inc. (Nasdaq: APLS), a global biopharmaceutical company pioneering targeted C3 therapies, today announced its first quarter 2020 financial results and business highlights.
“This past quarter, the COVID-19 pandemic presented the biotechnology industry – and the world – with many serious challenges. At Apellis, we have been fortunate on several fronts. In addition to being well capitalized and recently announcing positive Phase 3 data for pegcetacoplan in PNH, we had achieved strong initial enrollment in our ongoing Phase 3 trials prior to the slowdown related to COVID-19. I am most grateful, however, for our employees who have shown exceptional focus and a strong dedication to our mission of helping patients with debilitating diseases despite these challenging circumstances,” said Cedric Francois, M.D., Ph.D., co-founder and chief executive officer of Apellis.
“Our team has done a tremendous job adapting to the rapidly changing conditions while always keeping patient safety at the forefront,” Dr. Francois continued. “We are therefore able to reiterate our previous guidance for upcoming clinical milestones, including the full enrollment of our two Phase 3 trials in geographic atrophy and the Phase 3 PRINCE trial in treatment-naïve PNH patients. We also look forward to meeting with the FDA and EMA this quarter to discuss next steps for regulatory submissions for pegcetacoplan in PNH.”
COVID-19 Business Update:
Ongoing Clinical Trials
- Apellis is committed to advancing its ongoing clinical trials and reaching its milestones in line with previous guidance. The company is monitoring risks associated with potential interruptions in its clinical study sites and contract research organizations. Apellis does not at this time expect any delays in its previously announced clinical milestone timing.
- The company has drug supply sufficient to complete ongoing clinical studies across its development pipeline and does not expect delays to its clinical trials due to manufacturing or supply-chain issues.
Business Highlights and Upcoming Milestones:
Subcutaneous Pegcetacoplan (APL-2)
- Apellis expects to complete enrollment in the Phase 3 PRINCE trial evaluating pegcetacoplan in treatment-naïve patients with paroxysmal nocturnal hemoglobinuria (PNH) in the second quarter of 2020 and to announce top-line data from the study in early 2021.
- Apellis plans to present detailed 16-week results from the Phase 3 head-to-head PEGASUS study evaluating pegcetacoplan compared to eculizumab in patients with PNH at a future scientific meeting. The company also expects to report 48-week top-line results from the trial in the second half of 2020.
- Apellis plans to meet with regulators in the US and EU in the second quarter of this year to discuss next steps for regulatory submissions of pegcetacoplan in PNH.
- Apellis also plans to disclose the strategy and timing for further clinical development of pegcetacoplan for patients with cold agglutinin disease (CAD) and C3 glomerulopathy (C3G) in the second quarter of 2020.
- Apellis expects that its two Phase 3 trials for pegcetacoplan in patients with geographic atrophy (GA), DERBY and OAKS, will be fully enrolled in the second quarter of 2020 and that the company will announce top-line results from these trials in the third quarter of 2021.
- In April 2020, Apellis announced early data from its Phase 1b study of pegcetacoplan in 12 patients with advanced geographic atrophy. Over 12 months of treatment, the Phase 3 formulation of pegcetacoplan was well tolerated, and no cases of inflammation were observed. Additionally, in nine patients with bilateral GA (disease in both eyes), the decrease in mean lesion growth at 12 months was consistent with results from the Phase 2 FILLY study.
COVID-19 Clinical Program
- Apellis plans to initiate a Phase 1/2 clinical trial for APL-9, a clinical-stage, targeted C3 inhibitor designed for intravenous administration, for the treatment of patients with acute respiratory distress syndrome (ARDS) secondary to COVID-19. ARDS is a serious lung condition that causes low blood oxygen, often resulting in hospitalization and mechanical ventilation or other life-support measures.
Corporate & Other Highlights:
- In April 2020, Apellis expanded its Board of Directors to six with the appointment of Paul Fonteyne to the Board. Mr. Fonteyne brings more than three decades of experience in the biopharmaceutical industry to Apellis, including leadership roles in the United States and globally with Boehringer-Ingelheim.
First Quarter 2020 Financial Results:
As of March 31, 2020, Apellis had $648 million in cash, cash equivalents and short-term marketable securities, compared to $352 million as of December 31, 2019.
Apellis reported a net loss of $169 million for the first quarter of 2020, compared to a net loss of $51 million for the first quarter of 2019.
Research and development expenses were $69 million in the first quarter of 2020, compared to $40 million for the same period in 2019. The increase was primarily attributable to an increase of $11.5 million in contract manufacturing expenses in connection with the supply of pegcetacoplan for our Phase 3 clinical trials, an increase of $4.3 million in clinical trial costs associated with the preparation for the commencement of our Phase 3 clinical trials, an increase of $10.6 million in personnel-related costs primarily due to the hiring of additional personnel, an increase of $2.7 million related to research and innovation activities, an increase of $0.9 million in other development costs and device development expenses and offset by a decrease of $1.2 million in pre-clinical study expenses. We expect our research and development expenses to continue to increase as the number of patients in our trials increases and the number of ongoing trials increases.
General and administrative expenses were $30 million in the first quarter of 2020, compared to $8 million for the same period in 2019. The increase was primarily attributable to an increase in employee-related costs of $9.1 million, an increase in professional and consulting fees of $9.9 million, an increase in general office costs of $1.2 million and an increase of $0.4 million in director stock compensation expense, $0.4 million in conference and travel-related costs and $0.3 million in insurance. The increase in employee-related costs of $9.1 million consisted of a $6.4 million increase in salaries and benefits primarily due to the hiring of additional members of our management team, $1.9 million related to stock expense associated with the grants of stock options and restricted stock units to employees and $0.8 million in recruitment expense. The increased professional and consulting fees of $9.9 million primarily related to an increase in consulting fees of $8.3 million, an increase of $1.2 million in accounting and legal fees, and an increase in communication and public relations fees of $0.4 million.
About Pegcetacoplan (APL-2)
Pegcetacoplan is an investigational, targeted C3 inhibitor designed to regulate excessive complement activation, which can lead to the onset and progression of many serious diseases. Pegcetacoplan is a synthetic cyclic peptide conjugated to a polyethylene glycol polymer that binds specifically to C3 and C3b. Apellis is evaluating pegcetacoplan in several clinical studies including paroxysmal nocturnal hemoglobinuria (PNH), geographic atrophy (GA), and C3 glomerulopathy (C3G). Pegcetacoplan was granted Fast Track designation by the U.S. Food and Drug Administration (FDA) for the treatment of PNH and the treatment of GA. For additional information regarding our clinical trials, visit http://apellis.com/clinical-trials.html.
APL-9 is an investigational, targeted C3 inhibitor that leverages the same mechanism of action as Apellis’ lead compound, pegcetacoplan, but has a lower molecular weight and shorter half-life. APL-9 is designed to be intravenously administered for acute use whereas pegcetacoplan is designed for chronic subcutaneous or intravitreal administration.
Apellis Pharmaceuticals, Inc. is a global biopharmaceutical company that is committed to leveraging courageous science, creativity, and compassion to deliver life-changing therapies. By pioneering targeted C3 therapies, we aim to develop best-in-class and first-in-class therapies for a broad range of debilitating diseases that are driven by uncontrolled or excessive activation of the complement cascade, including those within hematology, ophthalmology, and nephrology. For more information, please visit http://apellis.com.
Apellis Forward-Looking Statement
Statements in this press release about future expectations, plans and prospects, such as the statements regarding the timing of enrollment of clinical trials, as well as any other statements regarding matters that are not historical facts, may constitute “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements relating to the implications of preliminary clinical data. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: whether the company’s clinical trials will be fully enrolled and completed when anticipated; uncertainties regarding the impact of the COVID-19 pandemic on the company’s business and operations, including the timing and conduct of its ongoing clinical trials, including its DERBY and OAKS trials; whether preliminary or interim results from a clinical trial such as the results presented in this will be predictive of the final results of the trial or of other trials; whether results obtained in preclinical studies and clinical trials will be indicative of results that will be generated in future clinical trials; whether pegcetacoplan will successfully advance through the clinical trial process on a timely basis, or at all; whether the results of the company’s clinical trials will warrant regulatory submissions and whether pegcetacoplan will receive approval from the FDA or equivalent foreign regulatory agencies for GA, PNH, CAD, C3G or any other indication when expected or at all; whether, if Apellis’ products receive approval, they will be successfully distributed and marketed; and other factors discussed in the “Risk Factors” section of Apellis’ Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 29, 2020 and the risks described in other filings that Apellis may make with the Securities and Exchange Commission. Any forward-looking statements contained in this press release speak only as of the date hereof, and Apellis specifically disclaims any obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.
|Apellis Pharmaceuticals, Inc.|
|Condensed Consolidated Balance Sheets|
|(Amounts in thousands, except per share amounts)|
|March 31,||December 31,|
|Cash and cash equivalents||$||417,881||$||351,985|
|Other current assets||1,891||1,308|
|Total current assets||672,407||373,095|
|Property and equipment, net||1,972||1,655|
|Liabilities and Stockholders' Equity|
|Current portion of right of use liabilities||2,732||2,609|
|Total current liabilities||50,740||65,753|
|Convertible senior notes||144,561||142,567|
|Development derivative liability||223,245||134,839|
|Operating lease liabilities||11,396||11,857|
|Preferred stock, $0.0001 par value; 10.0 million shares authorized, and zero |
shares issued and outstanding at March 31, 2020 and December 31, 2019
|Common stock, $0.0001 par value; 200.0 million shares authorized|
at March 31, 2020 and December 31, 2019 and 75.4 million shares
issued and outstanding at March 31, 2020 and 63.9 million shares
issued and outstanding at December 31, 2019
|Additional paid in capital||1,008,275||615,850|
|Accumulated other comprehensive gain/(loss)||1,010||(154||)|
|Total stockholders' equity||258,997||34,229|
|Total liabilities and stockholders' equity||$||688,939||$||389,245|
|Apellis Pharmaceuticals, Inc.|
|Condensed Consolidated Statements of Operations and Comprehensive Loss|
|(Amounts in thousands, except per share amounts)|
|Three Months Ended March 31,|
|Research and development||$||69,282||$||40,480|
|General and administrative||29,504||8,171|
|Loss on extinguishment of debt||-||(1,208||)|
|Loss from remeasurement of development|
|Other (expense)/income, net||14||(253||)|
|Other comprehensive gain:|
|Unrealized gain on marketable securities||1,394||-|
|Foreign currency gain/ (loss)||(230||)||2|
|Total other comprehensive gain/ (loss)||1,164||2|
|Comprehensive loss, net of tax||$||(167,658||)||$||(50,572||)|
|Net loss per common share, basic and diluted||$||(2.29||)||$||(0.87||)|
|Weighted-average number of common shares used in net|
loss per common share, basic and diluted