Apellis Pharmaceuticals Reports Third Quarter 2021 Financial Results
- Generated $5.3 million in EMPAVELI™ (pegcetacoplan) net product revenues
- Presented Phase 3 DERBY and OAKS results in geographic atrophy (GA); on track for NDA submission in 1H 2022
- Received positive CHMP opinion for pegcetacoplan for treatment of PNH; expect decision regarding approval by European Commission by end of 2021
- Conference call scheduled today at 4:30 p.m. ET
WALTHAM, Mass., Nov. 08, 2021 (GLOBE NEWSWIRE) -- Apellis Pharmaceuticals, Inc. (Nasdaq: APLS), a global biopharmaceutical company and leader in complement, today announced its third quarter 2021 financial results and business highlights.
“The third quarter was another exceptional period for Apellis, highlighted by successful commercial execution with EMPAVELI in PNH, the Phase 3 DERBY and OAKS results in geographic atrophy, and continued momentum advancing our broader pipeline,” said Cedric Francois, M.D., Ph.D., co-founder and chief executive officer of Apellis. “Our commercial launch of EMPAVELI is off to a strong start in the U.S. and we expect a decision regarding approval by the European Commission by the end of this year as we seek to elevate the standard of care in PNH worldwide.”
Dr. Francois continued, “With the DERBY and OAKS data, intravitreal pegcetacoplan has the potential to become the first treatment for patients living with geographic atrophy, a leading cause of blindness worldwide. We believe we have a robust data package that supports approval and remain on track to submit our New Drug Application to the FDA in the first half of 2022. Behind our lead programs, we are continuing to progress our broad pipeline addressing complement-driven diseases in rare disease, neurology, and ophthalmology.”
Third Quarter 2021 Business Highlights and Upcoming Milestones:
Paroxysmal Nocturnal Hemoglobinuria (PNH) Commercial Progress
- Apellis recorded $5.3 million in EMPAVELI™ (pegcetacoplan) net product revenue for the third quarter of 2021.
- In October 2021, Apellis and Sobi announced that the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) had adopted a positive opinion recommending the marketing authorization of systemic pegcetacoplan for the treatment of adults with PNH who are anemic after treatment with a C5 inhibitor for at least three months.
- A decision regarding approval is expected by the European Commission by the end of 2021.
- Apellis is eligible for a $50.0 million milestone payment from Sobi upon first regulatory and reimbursement approval. If systemic pegcetacoplan is approved by the EMA in 2021, Apellis expects to achieve this milestone in the first half of 2022.
Rare Disease R&D Highlights
- Immune complex membranoproliferative glomerulonephritis (IC-MPGN) and C3 glomerulopathy (C3G): Apellis expects to initiate a Phase 3 study in the fourth quarter of 2021.
- Cold agglutinin disease (CAD): Sobi plans to initiate a Phase 3 study in the fourth quarter of 2021.
- Hematopoietic stem cell transplantation-associated thrombotic microangiopathy (HSCT-TMA): Sobi plans to initiate a potentially registrational program in the fourth quarter of 2021.
- Amyotrophic lateral sclerosis (ALS): Apellis now expects to complete enrollment for its ongoing and potentially registrational Phase 2 MERIDIAN study in the first half of 2022 (previously end of 2021). Enrollment is slower than expected due to the COVID-19 pandemic and competing ongoing trials recruiting in ALS.
- EMPAVELI + small interfering RNA (siRNA): Apellis plans to study the combination of EMPAVELI and an siRNA, which may offer the potential to reduce the treatment frequency of EMPAVELI. Apellis expects to submit an Investigational New Drug (IND) application in the first half of 2023.
Ophthalmology R&D Highlights
- Geographic atrophy:
- In September 2021, Apellis reported top-line results from the Phase 3 DERBY and OAKS studies evaluating intravitreal pegcetacoplan, an investigational targeted C3 therapy, in 1,258 adults with geographic atrophy (GA) secondary to age-related macular degeneration (AMD).
- OAKS met the primary endpoint for both monthly and every-other-month treatment with pegcetacoplan, demonstrating a significant reduction in GA lesion growth of 22% (p=0.0003) and 16% (p=0.0052), respectively, compared to pooled sham at 12 months.
- DERBY narrowly missed the primary endpoint of GA lesion growth, showing a reduction of 12% (p=0.0528) and 11% (p=0.0750) with monthly and every-other-month treatment, respectively, compared to pooled sham at 12 months.
- In a prespecified analysis of the combined studies, pegcetacoplan decreased GA lesion growth in patients with extrafoveal lesions at baseline by 26% (p<0.0001) and 23% (p=0.0002) with monthly and every-other-month treatment, respectively.
- Pegcetacoplan demonstrated a favorable safety profile in both Phase 3 studies.
- Detailed data from the DERBY and OAKS studies were presented for the first time as part of two presentations at the Retina Society Annual Scientific Meeting in September 2021. This was followed by two additional presentations at The American Society of Retina Specialists Annual Meeting in September 2021. Copies of the presentations can be found on the Investors section of the Apellis website.
- The company plans to submit a New Drug Application (NDA) for pegcetacoplan for GA to the U.S. Food and Drug Administration (FDA) in the first half of 2022.
- In September 2021, Apellis reported top-line results from the Phase 3 DERBY and OAKS studies evaluating intravitreal pegcetacoplan, an investigational targeted C3 therapy, in 1,258 adults with geographic atrophy (GA) secondary to age-related macular degeneration (AMD).
- Intermediate AMD: Apellis plans to initiate a pivotal Phase 3 trial for pegcetacoplan in intermediate AMD in 2022, pending regulatory feedback.
- APL-2006: Apellis expects to submit an IND for APL-2006, a bispecific C3 and VEGF inhibitor, in the first half of 2023.
Neurology R&D Highlights
- APL-1030: Apellis expects to submit an IND for APL-1030, a first-in-class, brain-active C3 inhibitor for neurodegenerative diseases, in the second half of 2022.
Third Quarter 2021 Financial Results:
Cash. As of September 30, 2021, Apellis had $430.3 million in cash, cash equivalents, and short-term marketable securities, compared to $877.6 million in cash, cash equivalents, and short-term marketable securities as of December 31, 2020. Cash used during the period included the $50.0 million payment associated with the Beam collaboration.
Total Revenue. Total revenue was $5.7 million for the third quarter of 2021, which consisted of $5.3 million in recorded net product sales of EMPAVELI in the U.S. and $0.4 million in revenue associated with the Sobi collaboration. Apellis recorded $0.6 million in licensing revenue during the quarter ended September 30, 2020.
Research and Development (R&D) Expenses. R&D expenses were $87.7 million for the third quarter of 2021, compared to $93.2 million for the same period in 2020. The decrease in R&D expense for the third quarter of 2021 was primarily attributable to a decrease in contract manufacturing expenses due to the timing of drug supply and analytical activity, a decrease in the capitalization of inventory following FDA approval of EMPAVELI, and an increase in contra R&D expense related to the Sobi transaction. These amounts were offset by an increase in personnel related costs primarily due to the hiring of additional personnel, an increase in regulatory, quality and medical affairs expenses, and an increase in pre-clinical and clinical development costs.
General and Administrative (G&A) Expenses. G&A expenses were $45.8 million in the third quarter of 2021, compared to $37.0 million for the same period in 2020. The increase in G&A expenses for the third quarter of 2021 was primarily attributable to an increase in employee related costs, general commercial preparation activities, director stock compensation expense, and general office and travel related costs.
Net Loss. Apellis reported a net loss of $195.6 million for the third quarter of 2021, compared to a net loss of $135.7 million for the same period in 2020.
Conference Call and Webcast
Apellis will host a conference call and webcast to discuss its third quarter 2021 financial results and business highlights today, November 8, 2021, at 4:30 p.m. ET. To access the live call by phone, please pre-register for the call here. The conference ID is 1931859. A live audio webcast of the event and accompanying slides may also be accessed through the “Events and Presentations” page of the “Investors and Media” section of the company’s website. A replay of the webcast will be available for 30 days following the event.
About EMPAVELI™ (pegcetacoplan)
EMPAVELI™ (pegcetacoplan) is the first and only approved therapy targeting C3, the central protein in the complement cascade. EMPAVELI acts proximally in the complement cascade controlling both C3b-mediated extravascular hemolysis and terminal complement-mediated intravascular hemolysis. EMPAVELI is approved in the United States for the treatment of adults with paroxysmal nocturnal hemoglobinuria (PNH).
U.S. Important Safety Information for EMPAVELI
BOXED WARNING: SERIOUS INFECTIONS CAUSED BY ENCAPSULATED BACTERIA
- Meningococcal infections may occur in patients treated with EMPAVELI and may become rapidly life-threatening or fatal if not recognized and treated early. Use of EMPAVELI may predispose individuals to serious infections, especially those caused by encapsulated bacteria, such as Streptococcus pneumoniae, Neisseria meningitidis types A, C, W, Y, and B, and Haemophilus influenzae type B.
- Comply with the most current Advisory Committee on Immunization Practices (ACIP) recommendations for vaccinations against encapsulated bacteria.
- Vaccinate patients at least 2 weeks prior to administering the first dose of EMPAVELI unless the risks of delaying therapy with EMPAVELI outweigh the risk of developing a serious infection.
- Vaccination reduces, but does not eliminate, the risk of serious infections. Monitor patients for early signs of serious infections and evaluate immediately if infection is suspected.
- EMPAVELI is available only through a restricted program under a Risk Evaluation and Mitigation Strategy (REMS). Under the EMPAVELI REMS, prescribers must enroll in the program.
CONTRAINDICATIONS
- Hypersensitivity to pegcetacoplan or to any of the excipients
- Not currently vaccinated against certain encapsulated bacteria, unless the risks of delaying EMPAVELI treatment outweigh the risks of developing a bacterial infection with an encapsulated organism
- Unresolved serious infection caused by encapsulated bacteria including Streptococcus pneumoniae, Neisseria meningitidis, and Haemophilus influenzae
WARNINGS AND PRECAUTIONS
Serious Infections Caused by Encapsulated Bacteria
The use of EMPAVELI may predispose individuals to serious, life-threatening, or fatal infections caused by encapsulated bacteria, including Streptococcus pneumoniae, Neisseria meningitidis types A, C, W, Y, and B, and Haemophilus influenzae type B (Hib). To reduce the risk of infection, all patients must be vaccinated against these bacteria according to the most current ACIP recommendations for patients with altered immunocompetence associated with complement deficiencies. Revaccinate patients in accordance with ACIP recommendations considering the duration of therapy with EMPAVELI.
For patients without known history of vaccination, administer required vaccines at least 2 weeks prior to receiving the first dose of EMPAVELI. If immediate therapy with EMPAVELI is indicated, administer required vaccine as soon as possible and provide patients with 2 weeks of antibacterial drug prophylaxis.
Closely monitor patients for early signs and symptoms of serious infection and evaluate patients immediately if an infection is suspected. Promptly treat known infections. Serious infection may become rapidly life-threatening or fatal if not recognized and treated early. Consider discontinuation of EMPAVELI in patients who are undergoing treatment for serious infections.
EMPAVELI REMS
Because of the risk of serious infections, EMPAVELI is available only through a restricted program under a REMS. Under the EMPAVELI REMS, prescribers must enroll in the program and must counsel patients about the risk of serious infection, provide the patients with the REMS educational materials, and ensure patients are vaccinated against encapsulated bacteria. Enrollment and additional information are available by telephone: 1-888-343-7073 or at www.empavelirems.com.
Infusion-Related Reactions
Systemic hypersensitivity reactions (e.g., facial swelling, rash, urticaria) have occurred in patients treated with EMPAVELI. One patient (less than 1% in clinical studies) experienced a serious allergic reaction which resolved after treatment with antihistamines. If a severe hypersensitivity reaction (including anaphylaxis) occurs, discontinue EMPAVELI infusion immediately, institute appropriate treatment, per standard of care, and monitor until signs and symptoms are resolved.
Monitoring PNH Manifestations after Discontinuation of EMPAVELI
After discontinuing treatment with EMPAVELI, closely monitor for signs and symptoms of hemolysis, identified by elevated LDH levels along with sudden decrease in PNH clone size or hemoglobin, or reappearance of symptoms such as fatigue, hemoglobinuria, abdominal pain, dyspnea, major adverse vascular events (including thrombosis), dysphagia, or erectile dysfunction. Monitor any patient who discontinues EMPAVELI for at least 8 weeks to detect hemolysis and other reactions. If hemolysis, including elevated LDH, occurs after discontinuation of EMPAVELI, consider restarting treatment with EMPAVELI.
Interference with Laboratory Tests
There may be interference between silica reagents in coagulation panels and EMPAVELI that results in artificially prolonged activated partial thromboplastin time (aPTT); therefore, avoid the use of silica reagents in coagulation panels.
ADVERSE REACTIONS
The most common adverse reactions (incidence ≥10% of patients) with EMPAVELI vs. eculizumab were injection-site reactions (39% v. 5%), infections (29% v. 26%), diarrhea (22% v. 3%), abdominal pain (20% v. 10%), respiratory tract infection (15% v. 13%), viral infection (12% v. 8%), and fatigue (12% v. 23%).
USE IN SPECIFIC POPULATIONS
Females of Reproductive Potential
EMPAVELI may cause embryo-fetal harm when administered to pregnant women. Pregnancy testing is recommended for females of reproductive potential prior to treatment with EMPAVELI. Advise female patients of reproductive potential to use effective contraception during treatment with EMPAVELI and for 40 days after the last dose.
Please see full Prescribing Information, including Boxed WARNING regarding serious infections caused by encapsulated bacteria, and Medication Guide.
About Apellis
Apellis Pharmaceuticals, Inc. is a global biopharmaceutical company that is committed to leveraging courageous science, creativity, and compassion to deliver life-changing therapies. Leaders in targeted C3 therapies, we aim to develop transformative therapies for a broad range of debilitating diseases that are driven by excessive activation of the complement cascade, including those within hematology, ophthalmology, nephrology, and neurology.
Apellis Forward-Looking Statement
Statements in this press release about future expectations, plans and prospects, 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 in respect of the expected closing of the exchanges. 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 results obtained in preclinical studies and clinical trials will be indicative of results that will be generated in future clinical trials; whether the results of the DERBY and OAKS trials are sufficient to support regulatory submissions; whether a submission for approval of intravitreal pegcetacoplan for GA on the basis of the DERBY and OAKS trials will be accepted by the FDA or foreign regulatory agencies; whether intravitreal pegcetacoplan will receive approval from the FDA or equivalent foreign regulatory agencies for GA when expected or at all; whether the company’s clinical trials will be fully enrolled and completed when anticipated; whether preliminary or interim results from a clinical trial will be predictive of the final results of the trial; 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 CAD, C3G, IC-MPGN, HSCT-TMA, ALS 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 November 8, 2021 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.
Media Contact:
Lissa Pavluk
media@apellis.com
617.977.6764
Investor Contact:
Meredith Kaya
meredith.kaya@apellis.com
617.599.8178
| APELLIS PHARMACEUTICALS, INC. | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (Amounts in thousands, except per share amounts) | ||||||||
| September 30, | December 31, | |||||||
| 2021 | 2020 | |||||||
| Assets | (Unaudited) | |||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 283,745 | $ | 565,779 | ||||
| Marketable securities | 146,566 | 311,869 | ||||||
| Accounts receivable | 3,522 | - | ||||||
| Inventory | 1,677 | - | ||||||
| Prepaid assets | 17,374 | 11,400 | ||||||
| Restricted cash | 1,563 | 1,266 | ||||||
| Other current assets | 20,980 | 26,878 | ||||||
| Total current assets | 475,427 | 917,192 | ||||||
| Non-current Assets: | ||||||||
| Right-of-use assets | 20,930 | 17,719 | ||||||
| Property and equipment, net | 6,509 | 6,803 | ||||||
| Other assets | 22,823 | 18,855 | ||||||
| Total assets | $ | 525,689 | $ | 960,569 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 4,984 | $ | 8,477 | ||||
| Accrued expenses | 69,847 | 111,935 | ||||||
| Current portion of development derivative liability | 15,334 | 4,230 | ||||||
| Current portion of right of use liabilities | 4,072 | 3,685 | ||||||
| Total current liabilities | 94,237 | 128,327 | ||||||
| Long-term liabilities: | ||||||||
| Convertible senior notes | 189,610 | 358,830 | ||||||
| Development derivative liability | 281,017 | 253,638 | ||||||
| Operating lease liabilities | 18,150 | 15,217 | ||||||
| Total liabilities | 583,014 | 756,012 | ||||||
| Commitments and contingencies (Note 14) | - | - | ||||||
| Stockholders' equity: | ||||||||
| Preferred stock, $0.0001 par value; 10,000 shares authorized, and zero shares issued and outstanding at September 30, 2021 and December 31, 2020 | - | - | ||||||
| Common stock, $0.0001 par value; 200,000 shares authorized at June 30, 2021 and December 31, 2020; 87,219 shares issued and outstanding at September 30, 2021, and 76,130 shares issued and outstanding at December 31, 2020 | 9 | 8 | ||||||
| Additional paid-in capital | 1,453,431 | 1,131,013 | ||||||
| Accumulated other comprehensive loss | (2,010 | ) | (117 | ) | ||||
| Accumulated deficit | (1,508,755 | ) | (926,347 | ) | ||||
| Total stockholders' equity | (57,325 | ) | 204,557 | |||||
| Total liabilities and stockholders' equity | $ | 525,689 | $ | 960,569 | ||||
| APELLIS PHARMACEUTICALS, INC. | |||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | |||||||||||||||
| (Amounts in thousands, except per share amounts) | |||||||||||||||
| For the three months ended September 30, | For the nine months ended September 30, | ||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||
| (Unaudited) | (Unaudited) | ||||||||||||||
| Revenue: | |||||||||||||||
| Product revenue, net | $ | 5,314 | $ | — | $ | 5,937 | $ | — | |||||||
| Licensing and other revenue | 336 | 646 | 336 | 646 | |||||||||||
| Total revenue: | 5,650 | 646 | 6,273 | 646 | |||||||||||
| Operating expenses: | |||||||||||||||
| Cost of sales | 149 | — | 149 | — | |||||||||||
| Research and development | 87,733 | 93,207 | 267,688 | 249,584 | |||||||||||
| Cost of research collaboration | — | — | 50,000 | — | |||||||||||
| General and administrative | 45,763 | 36,991 | 135,309 | 94,909 | |||||||||||
| Total operating expenses: | 133,645 | 130,198 | 453,146 | 344,493 | |||||||||||
| Net operating loss | (127,995 | ) | (129,552 | ) | (446,873 | ) | (343,847 | ) | |||||||
| Loss on conversion of debt | (61,102 | ) | — | (100,589 | ) | — | |||||||||
| (Loss)/gain from remeasurement of development derivative liability | (4,219 | ) | 2,697 | (42,483 | ) | (62,939 | ) | ||||||||
| Interest income | 144 | 670 | 381 | 3,970 | |||||||||||
| Interest expense | (2,282 | ) | (9,499 | ) | (10,223 | ) | (20,327 | ) | |||||||
| Other (expense)/income, net | (117 | ) | (16 | ) | 1,366 | 4 | |||||||||
| Net loss | (195,571 | ) | (135,700 | ) | (598,421 | ) | (423,139 | ) | |||||||
| Other comprehensive (loss)/gain: | |||||||||||||||
| Unrealized (loss)/gain on marketable securities | (25 | ) | (430 | ) | 19 | 122 | |||||||||
| Foreign currency loss | (156 | ) | (1,658 | ) | (1,912 | ) | (1,727 | ) | |||||||
| Total other comprehensive loss | (181 | ) | (2,088 | ) | (1,893 | ) | (1,605 | ) | |||||||
| Comprehensive loss, net of tax | $ | (195,752 | ) | $ | (137,788 | ) | $ | (600,314 | ) | $ | (424,744 | ) | |||
| Net loss per common share, basic and diluted | $ | (2.28 | ) | $ | (1.79 | ) | $ | (7.31 | ) | $ | (5.65 | ) | |||
| Weighted-average number of common shares used in net loss per common share, basic and diluted | 85,661 | 75,628 | 81,846 | 74,925 | |||||||||||
