Heron Therapeutics Announces Financial Results for the Three and Twelve Months Ended December 31, 2019 and Highlights Recent Corporate Updates
SAN DIEGO, March 2, 2020 /PRNewswire/ -- Heron Therapeutics, Inc. (Nasdaq: HRTX), a commercial-stage biotechnology company focused on improving the lives of patients by developing best-in-class treatments to address some of the most important unmet patient needs, today announced financial results for the three and twelve months ended December 31, 2019 and highlighted recent corporate updates.
Recent Corporate Updates
Pain Management Franchise
-- New Drug Application for HTX-011: In September 2019, Heron resubmitted a
New Drug Application (NDA) to the U.S. Food and Drug Administration
(FDA) for HTX-011, an investigational agent for the management of
postoperative pain. In February 2020, Heron announced that the FDA has
extended the review period for the NDA for HTX-011 by up to three
months. The new Prescription Drug User Fee Act (PDUFA) goal date is June
26, 2020.
-- Contract Manufacturing Site for HTX-011: In February 2020, Heron
announced that the contract manufacturing site used to manufacture
HTX-011 has been reinspected by the FDA with no Form 483 observations
issued and with a recommendation by the FDA inspector for approval of
the site. Heron has not been informed of any other manufacturing
concerns.
-- Marketing Authorisation Application for HTX-011 in the European Union:
In March 2019, Heron's Marketing Authorisation Application (MAA) for
HTX-011 for the management of postoperative pain was validated by the
European Medicines Agency (EMA) for review under the Centralised
Procedure. An opinion from the EMA's Committee for Medicinal Products
for Human Use (CHMP) is anticipated in the second quarter of 2020.
-- New Drug Submission for HTX-011 in Canada: In December 2019, Heron's New
Drug Submission (NDS) for HTX-011 for the management of postoperative
pain was granted Priority Review status and accepted by Health Canada.
Health Canada's Priority Review status provides an accelerated 6-month
review target for the NDS. A decision by Health Canada is anticipated in
the third quarter of 2020.
CINV Franchise
-- CINV 2019 Net Product Sales: For the three months ended December 31,
2019, chemotherapy-induced nausea and vomiting (CINV) franchise net
product sales were $35.1 million, up 22% from the same period in 2018.
For the twelve months ended December 31, 2019, CINV franchise net
product sales were $146.0 million, up 88% from the same period in 2018.
-- CINVANTI(®) Net Product Sales: Net product sales of CINVANTI
(aprepitant) injectable emulsion for the three and twelve months
ended December 31, 2019 were $34.6 million and $132.2 million,
respectively, compared to $23.4 million and $56.2 million,
respectively, for the same periods in 2018.
-- SUSTOL(®) Net Product Sales: Net product sales of SUSTOL
(granisetron) extended-release injection for the three and twelve
months ended December 31, 2019 were $0.5 million and $13.8 million,
respectively, compared to $5.4 million and $21.3 million for the
same periods in 2018. On October 1, 2019, the Company made a
business decision to discontinue all discounting of SUSTOL, which
resulted in significantly lower SUSTOL net product sales.
-- 2020 Net Product Sales Guidance: Heron expects 2020 net product sales
for the CINV franchise of $70 million to $80 million and the CINV
franchise to return to growth in 2021 and beyond.
"We have made important advances in 2019 in both our pain management and CINV franchises, highlighted by the advancement of HTX-011 toward marketing approvals and strong sales for our CINV franchise," said Barry Quart, Pharm.D., President and Chief Executive Officer of Heron Therapeutics. "We look forward to launching HTX-011 for postoperative pain management in the second half of 2020, pending FDA approval."
Financial Results
Net product sales for the three and twelve months ended December 31, 2019 were $35.1 million and $146.0 million, respectively, compared to $28.8 million and $77.5 million, respectively, for the same periods in 2018.
Heron's net loss for the three and twelve months ended December 31, 2019 was $57.9 million and $204.7 million, or $0.65 per share and $2.50 per share, respectively, compared to $49.6 million and $178.8 million, or $0.63 per share and $2.44 per share, respectively, for the same periods in 2018. Net loss for the three and twelve months ended December 31, 2019 included non-cash, stock-based compensation expense of $11.1 million and $51.4 million, respectively, compared to $9.8 million and $33.4 million, respectively, for the same periods in 2018.
As of December 31, 2019, Heron had cash, cash equivalents and short-term investments of $391.0 million compared to $332.4 million as of December 31, 2018. Net cash used for operating activities for the twelve months ended December 31, 2019 was $124.6 million, compared to $191.8 million for the same period in 2018. Heron expects that its current cash, cash equivalents and short-term investments will be sufficient to fund its operations into 2022.
About HTX-011 for Postoperative Pain
HTX-011, an investigational agent, is a dual-acting, fixed-dose combination of the local anesthetic bupivacaine with a low dose of the nonsteroidal anti-inflammatory drug meloxicam. It is the first and only extended-release local anesthetic to demonstrate in Phase 3 studies significantly reduced pain and opioid use through 72 hours compared to bupivacaine solution, the current standard-of-care local anesthetic for postoperative pain control. HTX-011 was granted Fast Track designation from the U.S. Food and Drug Administration (FDA) in the fourth quarter of 2017 and Breakthrough Therapy designation in the second quarter of 2018. Heron submitted a New Drug Application (NDA) to the FDA for HTX-011 in October of 2018 and received Priority Review designation in December of 2018. A Complete Response Letter (CRL) was received from the FDA regarding the NDA for HTX-011 on April 30, 2019 relating to chemistry, manufacturing and controls and non-clinical information. No issues related to clinical efficacy or safety were noted. Heron resubmitted an NDA to the FDA for HTX-011 in September 2019. The Prescription Drug User Fee Act (PDUFA) goal date is June 26, 2020. A Marketing Authorisation Application (MMA) for HTX-011 was validated by the European Medicines Agency (EMA) in March 2019 for review under the Centralised Procedure. Heron's New Drug Submission (NDS) for HTX-011 for the management of postoperative pain was granted Priority Review status by Health Canada in October 2019 and accepted by Health Canada in November 2019.
About CINVANTI (Aprepitant) Injectable Emulsion
CINVANTI, in combination with other antiemetic agents, is indicated in adults for the prevention of acute and delayed nausea and vomiting associated with initial and repeat courses of highly emetogenic cancer chemotherapy (HEC) including high-dose cisplatin as a single-dose regimen, delayed nausea and vomiting associated with initial and repeat courses of moderately emetogenic cancer chemotherapy (MEC) as a single-dose regimen, and nausea and vomiting associated with initial and repeat courses of MEC as a 3-day regimen. CINVANTI is an IV formulation of aprepitant, a substance P/neurokinin-1 (NK(1)) receptor antagonist (RA). CINVANTI is the first IV formulation to directly deliver aprepitant, the active ingredient in EMEND(®) capsules. Aprepitant (including its prodrug, fosaprepitant) is the only single-agent NK(1) RA to significantly reduce nausea and vomiting in both the acute phase (0-24 hours after chemotherapy) and the delayed phase (24-120 hours after chemotherapy). The FDA-approved dosing administration included in the United States prescribing information for CINVANTI is a 30-minute IV infusion or a 2-minute IV injection.
Please see full prescribing information at www.CINVANTI.com.
About SUSTOL (Granisetron) Extended-Release Injection
SUSTOL is indicated in combination with other antiemetics in adults for the prevention of acute and delayed nausea and vomiting associated with initial and repeat courses of moderately emetogenic chemotherapy (MEC) or anthracycline and cyclophosphamide (AC) combination chemotherapy regimens. SUSTOL is an extended-release, injectable 5-HT(3) receptor antagonist that utilizes Heron's Biochronomer(®) drug delivery technology to maintain therapeutic levels of granisetron for >=5 days. The SUSTOL global Phase 3 development program was comprised of two, large, guideline-based clinical studies that evaluated SUSTOL's efficacy and safety in more than 2,000 patients with cancer. SUSTOL's efficacy in preventing nausea and vomiting was evaluated in both the acute phase (0-24 hours after chemotherapy) and delayed phase (24-120 hours after chemotherapy).
Please see full prescribing information at www.SUSTOL.com.
About Heron Therapeutics, Inc.
Heron Therapeutics, Inc. is a commercial-stage biotechnology company focused on improving the lives of patients by developing best-in-class treatments to address some of the most important unmet patient needs. Heron is developing novel, patient-focused solutions that apply its innovative science and technologies to already-approved pharmacological agents for patients suffering from pain or cancer.
For more information, visit www.herontx.com.
Forward-looking Statements
This news release contains "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995. Heron cautions readers that forward-looking statements are based on management's expectations and assumptions as of the date of this news release and are subject to certain risks and uncertainties that could cause actual results to differ materially, including, but not limited to, those associated with: whether the U.S. Food and Drug Administration (FDA) approves the New Drug Application (NDA) for HTX-011; the timing of the commercial launch of HTX-011; the timing of the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) review process for HTX-011; whether the European Commission (EC) authorizes the Marketing Authorisation Application (MAA) for HTX-011; the timing of Health Canada's New Drug Submission (NDS) review process for HTX-011; whether Health Canada issues a Notice of Compliance for the NDS for HTX-011; the expected future balances of Heron's cash, cash equivalents and short-term investments; the expected duration over which Heron's cash, cash equivalents and short-term investments balances will fund its operations; and other risks and uncertainties identified in the Company's filings with the U.S. Securities and Exchange Commission. Forward-looking statements reflect our analysis only on their stated date, and Heron takes no obligation to update or revise these statements except as may be required by law.
HERON THERAPEUTICS, INC.
Consolidated Balance Sheets
(In thousands, except par value amounts)
December 31, December 31,
2019 2018
ASSETS
Current assets:
Cash and cash equivalents $
71,898 $
31,836
Short-term investments 319,074 300,535
Accounts receivable, net 39,879 64,652
Inventory 24,968 39,032
Prepaid expenses and other current assets 23,245 11,193
Total current assets 479,064 447,248
Property and equipment, net 19,618 14,677
Right-of-use lease assets 13,754
Other assets 346 254
Total assets $
512,782 $
462,179
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $
2,758 $
16,863
Accrued clinical and manufacturing
liabilities 34,614 24,470
Accrued payroll and employee liabilities 15,248 13,397
Other accrued liabilities 36,535 32,715
Current lease liabilities 1,926
Convertible notes payable to related
parties, net of discount 5,624 4,574
Total current liabilities 96,705 92,019
Non-current lease liabilities 12,242
Total liabilities 108,947 92,019
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value: 2,500
shares authorized; no shares issued or
outstanding at December 31, 2019 and
2018
Common stock, $0.01 par value: 150,000
shares authorized; 90,304 and 78,174
shares issued and outstanding at
December 31, 2019 and 2018, respectively 903 782
Additional paid-in capital 1,568,317 1,330,186
Accumulated other comprehensive income
(loss) 85 (87)
Accumulated deficit (1,165,470) (960,721)
Total stockholders' equity 403,835 370,160
Total liabilities and stockholders'
equity $
512,782 $
462,179
HERON THERAPEUTICS, INC.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
---
2019 2018 2019 2018
---
(unaudited)
Revenues:
Net product sales $35,083 $28,844 $145,968 $77,474
Operating expenses:
Cost of product
sales 15,874 11,572 61,619 27,512
Research and
development 48,277 39,891 167,382 140,032
General and
administrative 9,874 8,738 37,897 29,263
Sales and marketing 20,420 19,957 89,764 64,604
---
Total operating
expenses 94,445 80,158 356,662 261,411
---
Loss from
operations (59,362) (51,314) (210,694) (183,937)
Other income, net 1,442 1,755 5,945 5,097
---
Net loss $(57,920) $(49,559) $(204,749) $(178,840)
Basic and diluted
net loss per share $(0.65) $(0.63) $(2.50) $(2.44)
Shares used in
computing basic
and diluted net
loss per share 89,112 78,086 81,779 73,193
===
HERON THERAPEUTICS, INC.
Consolidated Statements of Cash Flows
(In thousands)
Years Ended December 31,
2019 2018 2017
Operating activities:
Net loss $
(204,749) $
(178,840) $
(197,484)
Adjustments to reconcile net loss to net
cash used for operating
activities:
Stock-based compensation expense 51,411 33,367 30,538
Depreciation and amortization 2,044 1,513 1,531
Amortization of debt discount 1,050 890 773
Accretion of discount on short-term
investments (3,730) (3,412) (278)
Realized gain on available-for-sale
investments (8)
Impairment of property and equipment 107 72
Loss on disposal of property and equipment 62 29 39
Change in operating assets and liabilities:
Accounts receivable 24,773 (22,778) (39,914)
Prepaid expenses and other assets (12,052) (7,482) 3
Inventory 14,064 (29,122) (4,768)
Accounts payable (14,105) (1,906) 11,955
Accrued clinical and manufacturing
liabilities 10,144 (3,614) 13,713
Accrued payroll and employee liabilities 1,851 4,537 446
Deferred revenue 1,664
Other accrued liabilities 4,558 14,941 11,482
Net cash used for operating activities (124,580) (191,805) (170,300)
Investing activities:
Purchases of short-term investments (477,035) (497,104) (121,570)
Maturities and sales of short-term
investments 462,406 227,700 131,783
Purchases of property and equipment (7,154) (9,171) (2,553)
Proceeds from the sale of property and
equipment 25 78
Net cash (used for) provided by investing
activities (21,783) (278,550) 7,738
Financing activities:
Net proceeds from sale of common stock and/
or pre-funded
warrants 162,151 363,128 306,279
Proceeds from purchases under the Employee
Stock Purchase Plan 2,109 1,179 989
Proceeds from stock option exercises 22,164 18,301 11,463
Proceeds from warrant exercises 1
Repayment of promissory note payable to
related party (25,000) (25,000)
Net cash provided by financing activities 186,425 357,608 293,731
Net increase (decrease) in cash and cash
equivalents 40,062 (112,747) 131,169
Cash and cash equivalents at beginning of
year 31,836 144,583 13,414
Cash and cash equivalents at end of year $
71,898 $
31,836 $
144,583
Supplemental disclosure of cash flow
information:
Interest paid
$ $
1,183 $
2,789
Cumulative effect of adoption of new
accounting standard
$ $
1,574
$
Investor Relations and Media Contact:
David Szekeres
Chief Legal, Business and Administrative Officer
Heron Therapeutics, Inc.
dszekeres@herontx.com
858-251-4447
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