Arena Pharmaceuticals, Inc.
Nov 7, 2017

Arena Pharmaceuticals Provides Corporate Update and Reports Third Quarter 2017 Financial Results

- Submitted Ralinepag FDA Meeting Request
- Expect to Complete Full Enrollment for Etrasimod Phase 2 Study in Ulcerative Colitis This Week
- Initiated Etrasimod Phase 2 Study in Primary Biliary Cholangitis

SAN DIEGO, Nov. 7, 2017 /PRNewswire/ -- Arena Pharmaceuticals, Inc. (Nasdaq: ARNA), today provided a corporate update and reported financial results for the third quarter ended September 30, 2017.

"We are pleased with the progress we achieved during the third quarter, hitting multiple milestones for our lead programs," said Amit D. Munshi, President and CEO of Arena. "We remain highly focused on continuing to advance our lead programs and driving shareholder value. We look forward to meeting with the FDA about the Phase 3 program for ralinepag and reporting top-line Phase 2 data for etrasimod in ulcerative colitis and for APD371 in pain associated with Crohn's disease."

Pipeline Update

Ralinepag - Oral, selective, next generation IP receptor agonist targeting the prostacyclin pathway for the potential treatment of pulmonary arterial hypertension

  • Meeting request submitted to the FDA; Phase 3 clinical program preparations continue to progress

Etrasimod - Orally available next generation sphingosine-1-phosphate (S1P) receptor modulator for the potential treatment of a number of autoimmune diseases

  • Ulcerative colitis (UC):
    • Expect to complete enrollment of Phase 2 trial this week
    • Data expected Q1 2018
  • Primary biliary cholangitis (PBC):
    • Phase 2 study initiated
  • Pyoderma gangrenosum (PG):
    • Phase 2 trial currently enrolling patients
  • Dermatological extraintestinal manifestations (EIM):
    • Phase 2 study enrolled; intend to evaluate in combination with UC study

APD371 - Orally available full agonist of the cannabinoid-2 receptor for the potential treatment of visceral pain, specifically pain associated with Crohn's disease

  • Phase 2 trial currently enrolling patients
  • Data expected Q1 2018

Collaborations Update

  • Nelotanserin - Axovant collaboration
    • Visual hallucinations in Lewy body dementia (LBD):
      • Phase 2 data expected Q1 2018
    • REM sleep behavior disorder in subjects with LBD:
      • Phase 2 data­­ expected Q2 2018

Corporate Update

  • Appointed Chris Cabell, M.D., MHS, FACC, as Senior Vice President, Clinical Development
  • Closed a public offering that raised aggregate net proceeds of $162.0 million through the issuance of approximately 7.2 million shares of common stock

Financial Update

Third Quarter 2017 Financial Results

  • Revenues totaled $7.9 million, including $3.1 million in net product sales of BELVIQ, $1.7 million in manufacturing support payments from Eisai, and approximately $1.9 million of revenue from Boehringer Ingelheim and Axovant collaborations
  • Research and development expenses totaled $17.3 million
  • General and administrative expenses totaled $7.8 million
  • Litigation settlement expense, net related to tentative settlement of the 2010 securities class action litigation totaled $12.0 million
  • Net loss was $32.4 million, or $0.86 per share

At September 30, 2017, cash and cash equivalents totaled $278.7 million, and approximately 39.3 million shares of Arena common stock were outstanding.

Conference Call & Webcast Information
The Company will host a conference call and live webcast with the investment community today, Tuesday, November 7, 2017, at 4:30 p.m. EST to discuss the financial results and provide a corporate update.

When: November 7, 2017, 4:30 p.m. EST
Dial-in: (877) 643-7155 (United States) or (914) 495-8552 (International)
Conference ID: 1910287

Please join the conference call at least 10 minutes early to register.

You can access the live webcast under the investor relations section of Arena's website at:  www.arenapharm.com. A replay of the conference call will be archived under the investor relations section of Arena's website for 30 days shortly after the call.

About Arena Pharmaceuticals
Arena Pharmaceuticals is a biopharmaceutical company focused on developing novel, small molecule drugs with optimized receptor pharmacology designed to deliver broad clinical utility across multiple therapeutic areas. Our proprietary pipeline includes potentially first- or best-in-class programs for which we own global commercial rights. Our three most advanced investigational clinical programs are ralinepag (APD811) which has completed a Phase 2 trial for pulmonary arterial hypertension (PAH), etrasimod (APD334) in Phase 2 evaluation for multiple autoimmune indications, and APD371 in Phase 2 evaluation for the treatment of pain associated with Crohn's disease. In addition, Arena has collaborations with the following pharmaceutical companies: Eisai Co., Ltd. and Eisai Inc. (commercial stage), Axovant Sciences (Phase 2 candidate), and Boehringer Ingelheim International GmbH (preclinical candidate).

Forward-Looking Statements
Certain statements in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements may be identified by words such as "expect", "look forward to", "preparations", "intend", "potential", "will", "may", and similar words, and include, without limitation, statements about timing relating to ongoing or intended clinical trials, planned meetings with the FDA, patient enrollment in ongoing or intended clinical trials, advancement of our pipeline, expected results, anticipated data readouts, the significance of clinical data, shareholder value creation, and Arena's focus, goals, strategy and clinical programs. For such statements, Arena claims the protection of the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from Arena's expectations. Factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to, the following:  the timing and outcome of research, development and regulatory review is uncertain; enrolling patients in our ongoing and intended clinical trials is competitive and challenging; we expect to need additional funds to advance all of our programs, and you and others may not agree with the manner we allocate our resources; our drug candidates may not advance in development or be approved for marketing; risks related to developing and commercializing drugs; the risk that Arena's revenues are based in part on estimates, judgment and accounting policies, and incorrect estimates or disagreement regarding estimates or accounting policies may result in changes to Arena's guidance or previously reported results; government and third-party payor actions, including relating to reimbursement and pricing; risks related to relying on collaborative arrangements; the entry into or modification or termination of collaborative arrangements; unexpected or unfavorable new data; nonclinical and clinical data are voluminous and detailed, and regulatory agencies may interpret or weigh the importance of data differently and reach different conclusions than Arena or others, request additional information, have additional recommendations or change their guidance or requirements before or after approval; topline data may not accurately reflect the complete results of a particular study or trial; Arena's and third parties' intellectual property rights; results of clinical trials and other studies are subject to different interpretations and may not be predictive of future results; clinical trials and other studies may not proceed at the time or in the manner expected or at all; and satisfactory resolution of litigation or other disagreements with others. Additional factors that could cause actual results to differ materially from those stated or implied by Arena's forward-looking statements are disclosed in Arena's filings with the Securities and Exchange Commission. These forward-looking statements represent Arena's judgment as of the time of this release. Arena disclaims any intent or obligation to update these forward-looking statements, other than as may be required under applicable law.

Corporate Contact: 
Kevin R. Lind
Arena Pharmaceuticals, Inc.
Executive Vice President and 
Chief Financial Officer 
klind@arenapharm.com
858.210.3636

Media Contact: 
Matt Middleman, M.D.
LifeSci Public Relations
matt@lifescipublicrelations.com
646.627.8384

(Tables Follow)

Arena Pharmaceuticals, Inc.

Condensed Consolidated Statements of Operations

(In thousands, except per share amounts)










Three months ended


Nine months ended


September 30,


September 30,


2017


2016


2017


2016


(unaudited)


(unaudited)

Revenues








Net product sales

$     3,075


$     3,323


$    7,845


$    11,104

Other Eisai collaboration revenue

2,223


12,954


5,539


18,155

Other collaboration revenue

1,881


1,737


5,439


6,066

Toll manufacturing

769


1,228


2,241


3,276

  Total revenues

7,948


19,242


21,064


38,601









Operating Costs & Expenses








Cost of product sales

1,739


882


5,768


4,161

Cost of toll manufacturing

1,222


1,930


3,215


4,876

Research & development

17,307


17,466


50,740


54,514

General & administrative

7,791


8,590


23,191


23,979

Litigation settlement expense, net

11,975



11,975


Restructuring charges


231



6,346

  Total operating costs & expenses

40,034


29,099


94,889


93,876









Interest & Other Income (Expense)








Interest income

13


54


63


247

Interest expense

(1,516)


(1,609)


(4,624)


(4,907)

Other

925


(1,067)


(391)


(1,275)

  Total interest & other income (expense), net

(578)


(2,622)


(4,952)


(5,935)

Net loss

(32,664)


(12,479)


(78,777)


(61,210)

Less net loss attributable to noncontrolling interest in consolidated variable interest entity

311


122


1,054


122

Net loss attributable to stockholders of Arena

$  (32,353)


$  (12,357)


$   (77,723)


$   (61,088)









Net loss attributable to stockholders of Arena per share:1















Basic

$     (0.86)


$     (0.51)


$      (2.24)


$      (2.51)

Diluted

$     (0.86)


$     (0.51)


$      (2.24)


$      (2.51)









Shares used in calculating net loss attributable to stockholders of Arena per share:1








Basic

37,776


24,325


34,692


24,307

Diluted

37,776


24,325


34,692


24,307


1 Comparative period data adjusted to give effect to Arena's June 2017 1-for-10 reverse stock split.

 

Arena Pharmaceuticals, Inc.

Condensed Consolidated Balance Sheet Data

(In thousands)

(unaudited)






September 30, 2017


December 31, 2016




1

Assets




  Cash & cash equivalents

$ 278,738


$ 90,712

  Accounts receivable

2,373


20,162

  Insurance recovery receivable

12,025


  Inventory

6,848


6,708

  Prepaid expenses & other current assets

3,717


2,307

  Land, property & equipment, net

39,425


43,828

  Intangibles & other non-current assets

4,695


5,293

       Total assets

$ 347,821


$ 169,010





Liabilities & Stockholders' Equity




  Accounts payable & accrued liabilities

$   12,787


$   25,073

  Accrued litigation settlement

24,000


  Total deferred revenues

29,258


37,455

  Total lease financing obligations & other long-term liabilities

63,655


66,087

  Total stockholders' equity

218,121


40,395

       Total liabilities & stockholders' equity

$ 347,821


$ 169,010


1 The Condensed Consolidated Balance Sheet Data have been derived from the audited financial statements as of that date.

 

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