Insmed Reports Second Quarter Financial Results 2013
Second Quarter Financial Results
For the second quarter of 2013, Insmed reported a net loss of $8.9 million, or $0.28 per share, compared with a net loss of $9.7 million, or $0.39 per share, for the second quarter of 2012. The decrease in net loss is primarily due to $11.5 million in revenue recorded during the second quarter of 2013 that related to a one-time payment for the sale of the Company's right to receive future royalties under its license agreement with Premacure AB (now Shire plc). This one-time revenue was partially offset by higher research and development and general and administrative expenses.
Research and development expenses in the second quarter of 2013 increased to $12.2 million from $7.7 million in the second quarter of 2012, primarily due to higher costs for clinical trial activities associated with the Company's Phase 3 clinical trial and two-year open-label extension study in CF patients with pseudomonas lung infections in Europe and Canada, and its Phase 2 clinical trial in patients with NTM lung infections in the United States.
General and administrative expenses for the second quarter of 2013 increased to $7.5 million from $2.2 million in the second quarter of 2012. The increase was primarily due to higher compensation expense, which included $2.6 million in non-cash stock-based compensation expense, and $1.0 million in market research and other related costs.
Highlights of the second quarter of 2013 and recent weeks include:
•Achieved the Primary Endpoint in a Registrational Phase 3 Clinical Trial of ARIKACE® to treat Cystic Fibrosis (CF) Patients with Pseudomonas aeruginosa infections (Pa). The European and Canadian Phase 3 clinical trial of once-daily ARIKACE (liposomal amikacin for inhalation) achieved its primary endpoint of non-inferiority to twice-daily TOBI® (tobramycin inhalation solution) for relative change in forced expiratory volume in one second (FEV1) from baseline to end of study. Secondary endpoints showed comparability of once-daily ARIKACE compared with twice-daily TOBI consistent with the primary endpoint of the study.
•Granted Qualified Infectious Disease Product (QIDP) and Fast Track Designations for ARIKACE in Nontuberculous Mycobacteria (NTM) Lung Infections. The U.S. Food and Drug Administration (FDA) granted ARIKACE QIDP and Fast Track designations for the treatment of NTM.
•Completed an Underwritten Public Offering. Insmed completed an underwritten public offering of 6.9 million shares of common stock, which reflects the underwriters' exercise in full of their over-allotment option of 900,000 shares, which provided net proceeds to the Company of approximately $67.0 million.
•Received Notice of Allowance for Key European Composition-of-Matter Patent for ARIKACE. The European Patent Office notified Insmed that it intends to grant a key European composition of matter patent for ARIKACE. Once granted, the patent will provide protection for novel anti-infective formulations comprising an aminoglycoside and Insmed's liposomal delivery technology, and methods for making the formulations. Amikacin is one of the aminoglycosides covered by the patent. The patent also includes claims relating to the use of the aminoglycoside/lipid formulations for treating pulmonary infections, including those caused by Pa and certain mycobacterial infections, among others.
•Appointed Christine Pellizzari as General Counsel and Secretary. In July, Ms. Pellizzari joined Insmed with nearly 20 years of experience at development- and commercial-stage biopharmaceutical companies, including senior-level legal and strategic leadership roles at Aegerion Pharmaceuticals and Dendrite, Inc.
"Throughout the second quarter and in recent weeks we made significant progress in a number of areas critical to our goal of becoming a patient-centric biopharmaceutical company. We reported positive clinical data and regulatory developments, fortified our patent portfolio, enhanced our management team and strengthened our balance sheet. We are focused on preparing our regulatory filing for ARIKACE in Europe and Canada to treat Pseudomonas aeruginosa infections in patients with CF, and pursuing a dialogue with the FDA regarding the U.S. regulatory pathway for ARIKACE to treat NTM," said Will Lewis, President and Chief Executive Officer of Insmed.
"With positive Phase 3 data for our CF indication and our QIDP and Fast Track designations for our NTM indication, we are actively moving forward with our strategy to bring once-daily ARIKACE to patients suffering from these orphan lung diseases in two indications in two geographies in two years," concluded Mr. Lewis.