Incyte Corporation (Nasdaq:INCY) today reported fourth quarter and full
year 2009 financial results, provided an update on key fourth quarter
accomplishments and 2010 objectives, and announced its 2010 financial
guidance.
Paul A. Friedman, M.D., Incyte's President and Chief Executive Officer,
stated, “We achieved all of our corporate goals in 2009 including the
initiation of a global Phase III program for our lead compound,
INCB18424, for myelofibrosis, the completion of a successful corporate
financing and the establishment of two major alliances with top-tier
pharmaceutical firms. Consequently, we are in a strong position to
advance our pipeline and prepare for the potential launch of INCB18424
in myelofibrosis.
“Key objectives for 2010 include completing our US Phase III
registration trial for INCB18424 in myelofibrosis, determining product
registration requirements for INCB18424 as a treatment for polycythemia
vera and possibly essential thrombocythemia, and reporting Phase II
results for INCB28050 for rheumatoid arthritis which we expect will
support moving forward into a larger Phase IIb trial with our partner,
Eli Lilly.”
David C. Hastings, Incyte’s Executive Vice President and Chief Financial
Officer, stated, “By successfully completing our equity and senior
convertible note offering in 2009 we strengthened our balance sheet and
removed a significant financial overhang from the Company. Additionally,
with the completion of two collaborative agreements in the fourth
quarter, we ended the year, on a pro forma basis, with approximately
$624 million in cash, cash equivalents and marketable securities.”
Below is a summary of recent accomplishments:
Business Development
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Novartis: Collaboration and license agreement for two
hematology-oncology programs; INCB18424, JAK1/JAK2 Inhibitor, and
INCB28060, cMET inhibitor
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Lilly: Collaboration for development and commercialization of oral
anti-inflammatory and autoimmune therapies for INCB28050, JAK1/JAK2
Inhibitor
Clinical Programs
JAK1/JAK2 Inhibitor: INCB18424 (oral formulation) for Myelofibrosis
(MF), Polycythemia Vera (PV) and Essential Thrombocythemia (ET)
-
Continued patient enrollment of the Phase III registration trials,
COMFORT-I and COMFORT- II:
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COMFORT-I is expected to enroll approximately 240 MF patients and
includes over 90 clinical sites in the US, Canada and Australia.
We expect recruitment for this study to complete in the first
quarter of this year.
-
COMFORT-II is fully enrolled with over 200 MF patients at
approximately 65 clinical sites in Europe.
-
Presented positive clinical results from three ongoing Phase II trials
at the 2009 American Society of Hematology Annual Meeting in December
involving patients with myelofibrosis, patients with advanced
polycythemia vera and essential thrombocythemia refractory to
hydroxyurea and patients with relapsed or refractory hematological
malignancies.
JAK1/JAK2 Inhibitor: INCB28050 for Rheumatoid Arthritis (RA) and
Other Inflammatory Conditions
-
Completed patient enrollment for a six-month double-blind
placebo-controlled dose-ranging Phase II trial involving 127 RA
patients. The three and six month results from this trial are expected
to be available in the first and second half of 2010, respectively.
Sheddase Inhibitor: INCB7839 for Breast Cancer
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Data from a Phase I/II trial presented at the 32nd San Antonio Breast
Cancer Symposium suggest that INCB7839, in combination with
trastuzumab (Herceptin®) based regimens, may provide additional
benefits over traditional trastuzumab based regimens in a defined
subgroup of breast cancer patients.
2010 Clinical Program Goals
Oncology Programs
JAK1/JAK2 Inhibitor: INCB18424 (oral formulation)
-
Complete and present results from the Comfort-I Phase III US trial and
begin preparation of the New Drug Application for MF to insure
earliest possible filing in 2011
-
Confirm regulatory requirements with the FDA for approval in two other
myeloproliferative neoplasms, first in PV followed by ET
-
In conjunction with the Children’s Oncology Group at the National
Cancer Institute, support initiation of a Phase I/II trial in children
with relapsed or refractory solid tumors, hematological malignancies
and myeloproliferative neoplasms
Sheddase Inhibitor: INCB7839
-
Meet with the FDA to discuss registration requirements for use in
patients with p95 HER2 positive breast cancer provided results from
the ongoing clinical development program in this subset of patients
continues to demonstrate positive results
Early Stage Oncology Programs
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cMET Inhibitor, INCB28060: Complete an initial Phase I/II trial in
patients with solid tumors and transfer the program to Novartis
-
IDO Inhibitor, INCB24360: Initiate a Phase I/II trial in patients with
solid tumors
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Discovery: File an Investigational New Drug Application for another
oncology compound that addresses a new target
Inflammation Programs
JAK1/JAK2 Inhibitor: INCB28050
-
Complete the Phase II trial and present top-line results for the
three-month portion of the study in the first half of this year;
present the full six month results at the American College of
Rheumatology Annual Meeting
-
Based on these results, decide whether to exercise our co-development
option and participate in the Phase IIb program
JAK1/JAK2 Inhibitor: INCB18424 (topical formulation)
-
Present full results from the three-month Phase IIb trial at a
scientific meeting
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Decide on the appropriate next clinical trials
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Evaluate potential strategic alliance opportunities
2009 Fourth Quarter and Full Year Financial Results
Net Loss
Quarter Ended December 31, 2009
Net loss for the fourth quarter ended December 31, 2009 was $88.4
million, or $0.74 per share, as compared to $48.4 million, or $0.50 per
share, for the same period in 2008. Included in the net loss for the
quarter ended December 31, 2009 were the following:
-
a one-time non-cash charge of $34.3 million or $0.29 per share related
to a mark-to-market adjustment in the value of the embedded derivative
liability related to the 4.75% Convertible Senior Notes due 2015; and
-
a non-cash expense of $4.7 million or $0.04 per share related to the
amortization of the discount on the 4.75% Convertible Senior Notes.
Excluding these items, the net loss for the quarter was $0.41 per share.
As a result of the completion of its 4.75% Convertible Senior Notes
private placement, the Company decreased the original carrying value of
the Notes by $148.1 million to reflect an embedded derivative liability
related to the underlying number of common shares available at the time
of the Notes issuance. On November 24, 2009, the Company’s stockholders
approved an increase in the Company’s authorized common shares, and the
Company recorded a mark-to-market adjustment in the value of the
embedded derivative liability that resulted in a $34.3 million one-time
non-cash charge. As a result of the increase in authorized common
shares, the Company is no longer required to account for the embedded
derivative as a liability and has reclassified it to
additional-paid-in-capital.
Also included in net loss for the quarter ended December 31, 2009 was
$1.9 million of non-cash expense related to the impact of expensing
share-based payments, including employee stock options, compared to $3.9
million for the same period in 2008.
Year Ended December 31, 2009
Net loss for the full year 2009 was $211.9 million, or $2.06 per share
as compared to $178.9 million, or $1.99 per share, for the full year
2008. Included in the net loss for the year ended December 31, 2009 were
the following:
-
the aforementioned $34.3 million one-time non-cash charge associated
with the 4.75% Convertible Senior Notes, or $0.33 per share on a year
to date basis;
-
the aforementioned non-cash expense related to the amortization of the
discount of $4.7 million on the 4.75% Convertible Senior Notes, or
$0.05 per share on a year to date basis; and a
-
a non-cash charge of $5.7 million or $0.06 per share related to the
repurchase of 3 1/2% Convertible Senior and Subordinated Notes.
Excluding these items, the net loss for the year was $1.62 per share.
Also included in net loss for the year ended December 31, 2009 was $10.0
million of non-cash expense related to the impact of expensing
share-based payments, including employee stock options, compared to
$15.0 million for the same period in 2008.
Cash Position
As of December 31, 2009, cash, short-term and long-term marketable
securities totaled $473.9 million, excluding $56.2 million in restricted
cash for an escrow account reserved for the first 3 years of interest
payments on the 4.75% Convertible Senior Notes, compared to $217.8
million as of December 31, 2008. In January 2010, the Company received
an additional $60 million milestone payment from Novartis for the
initiation of the COMFORT II clinical trial and $90 million upfront
payment related to its recent collaborative agreement with Lilly.
Excluding the proceeds from its follow on equity offering and its
private placement of the 4.75% Convertible Senior Notes, repurchases of
a portion of the 3 1/2% Convertible Senior Notes and 3 1/2% Convertible
Subordinated Notes, funding of the interest escrow, and the upfront
payment received under the collaboration and license agreement with
Novartis, the Company used $133.0 million in cash and marketable
securities in the year ended December 31, 2009 including legal and
transaction fees related to its recent collaborative agreements with
Novartis and Lilly.
Revenues
Total revenues for the fourth quarter and full year ended December 31,
2009 were $6.9 million and $9.3 million, respectively, as compared to
$0.9 million and $3.9 million for the same periods in 2008. The increase
was primarily the result of revenues recognized in the fourth quarter
under the Company’s collaborative agreements with Novartis and Lilly.
Operating Expenses