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2 Important Takeaways from ARCA Biopharma's Q3 Results

REDONDO BEACH, CA / ACCESSWIRE / November 18, 2015 / ARCA biopharma (ABIO), a biopharmaceutical company developing genetically-targeted therapies for cardiovascular diseases, recently announced its third quarter financial results and provided a business update. While the results were largely in-line with expectations, there were two key takeaways that shareholders and potential investors should note - its $41.5 million cash runway and the successful rollout of its revised trial protocols.

Cash to Catalyst

"Cash and cash equivalents totaled $41.5 million as of September 30, 2015, compared to $15.4 million as of December 31, 2014. The Company believes that its current cash and cash equivalents will be sufficient to fund its operations, at its projected cost structure, through at least the end of 2017. ARCA had approximately 9.0 million outstanding shares of common stock as of September 30, 2015."

ARCA biopharma disclosed $41.5 million in cash and cash equivalents, as of September 30, 2015, which management believes will be sufficient to fund its operations through at least the end of 2017. This cash runway is significant given that Phase 2B efficacy data is expected to be released during the first half of 2017, according to Dr. Bristow's comments earlier in the press release, which means that investors could see a big catalyst ahead of any future dilution.

The company's cash burn has increased during the quarter due to the opening of additional GENETIC-AF clinical trial sites, but these costs should begin to even out as the company reaches its target of 65 clinical trial sites by the fourth quarter of this year.

For investors, the cash runway removes a significant overhang in the stock caused by the potential for dilutive financing before a major catalyst.

On-going Enrollment

"Additional investigative clinical sites were approved, trained, and began adopting the revised protocol, with all of the client sites now operating under the revised protocol."

ARCA biopharma introduced a revised trial protocol to expand its patient population that has been rolled out to all 58 clinical trial sites across the U.S. and Canada. While the revised protocol was announced back in March of this year, the implementation across all of its clinical trial sites suggests that patient enrollment could accelerate. The other key benefit is that the treatment now addresses a much larger commercial end market, if approved.

Under the new protocol, patients in sinus rhythm who have experienced symptomatic A-Fib in the past 120 days are eligible to be included in the trial. The trial was previously restricted to only patients with A-Fib episodes lasting seven days or less, which was a substantially more limited patient population. With these revised criteria, the company anticipates enrolling 200 patients in its Phase 2B trial and an additional 420 patients in a Phase 3 trial.

De-Risked Trial

ARCA biopharma's GENETIC-AF clinical trial is premised on a DNA sub-study of a BEST trial of 2,708 heart failure patients, which showed a 74% improvement in A-Fib for a specific genotype compared to a 41% improvement in the broader population. In addition, the genotype is present in approximately half of the population. This means that the treatment in the appropriate genotype has a higher potential of seeing efficacy, while addressing a large patient population.

Gencaro's classification as a beta-blocker also means that it's likely well-tolerated with relatively low risk for patients with advanced A-Fib. Given this class of drug's established safety profile, the company likely has a low risk of failing to secure regulatory approvals due to its safety profile - a big concern and regulatory hurdle for many new classes of drugs.

The combination of likely efficacy and a strong safety profile yield a relatively de-risked clinical trial compared to many other novel cardiovascular therapeutics.

Looking Ahead

Investors may want to take a closer look at ARCA biopharma following its third quarter financial results given its cash runway, on-going trial enrollment, and de-risked clinical trial. In addition, investors interested in the cardiovascular therapeutics space, including companies like Cardiome Pharma Corp. (CRME) and Cytokinetics Inc. (CYTK), may want to take a look at the stock given its upcoming catalysts.

For more information, visit the company's website at www.arcabiopharma.com.

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SOURCE: Emerging Growth LLC