- Vertex Pharmaceuticals to Acquire Cystic
Fibrosis Candidate, CTP-656, from Concert Pharmaceuticals for up to
$250 Million -
- CTP-543 On Track to Advance Into Phase 2a
Trial -
- Conference Call Scheduled Today at 8:30
a.m. EST -
Concert Pharmaceuticals, Inc. (NASDAQ:CNCE) today reported
financial results for the year ended December 31, 2016, as well as
provided an update on its product pipeline and corporate
activities.
“We are excited to continue the progression of our clinical
candidates, CTP-656 and CTP-543. These two drug candidates, CTP-656
for cystic fibrosis and CTP-543 for alopecia areata, further our
goal of developing innovative treatments with the potential to
provide important benefits to patients,” said Roger Tung, Ph.D.
President and Chief Executive Officer of Concert Pharmaceuticals.
“I am very pleased that Vertex intends to integrate CTP-656 within
their portfolio of investigational and approved CF medicines. We
believe this agreement provides the optimal pathway to broadly and
rapidly advance the development of CTP-656 for patients.”
Recent Business Highlights and Upcoming Milestones
- CTP-656 Asset Purchase
Agreement. On March 6, 2017, Concert announced that it entered
into an asset purchase agreement worth up to $250 million with
Vertex Pharmaceuticals, Inc., under which Vertex will acquire all
rights to CTP-656 and other assets related to cystic fibrosis. The
asset purchase agreement is subject to the approval of Concert’s
shareholders and other customary conditions. As part of the
agreement, Vertex will pay Concert $160 million in cash upon
closing for all worldwide development and commercialization rights
to CTP-656. If CTP-656 is approved as part of a combination regimen
to treat CF, Concert could receive up to an additional $90 million
in milestones based on regulatory approval in the U.S. and
reimbursement in the UK, Germany or France.
- CTP-656 Phase 2 Development for
Cystic Fibrosis in U.S. Concert is conducting a randomized,
placebo-controlled Phase 2 clinical trial evaluating CTP-656 in the
U.S. in cystic fibrosis patients with gating mutations. The Company
continues to expect topline data by year end 2017.
- CTP-656 Orphan Drug Designation.
In January 2017, the U.S. Food and Drug Administration (FDA)
granted orphan drug designation for CTP-656. The Orphan Drug Act
provides incentives for companies to develop products for rare
diseases affecting fewer than 200,000 people in the United
States.
- CTP-543 Phase 1 Evaluation
Complete. The Phase 1 single and multiple ascending dose trial
evaluating CTP-543 in healthy volunteers is complete. The
pharmacokinetic measurements showed increased exposure with
increasing doses of CTP-543. In the study, CTP-543 was well
tolerated across all dose groups and there were no serious adverse
events reported in subjects who received CTP-543. The Phase 1
pharmacokinetic findings were presented at the American Academy of
Dermatology Annual Meeting taking place March 3-7, 2017 in Orlando,
FL.
- CTP-543 Phase 1 Crossover Study.
In a Phase 1 crossover study evaluating the metabolite profiles of
CTP-543 and ruxolitinib, as previously demonstrated with other
deuterium-modified compounds, the Company confirmed that, except
for the presence of deuterium, no new metabolites were observed
with CTP-543.
- CTP-543 Phase 1 Pharmacodynamic
Results. In the multiple ascending dose Phase 1 trial of
CTP-543, pharmacodynamic analyses were performed to assess the
inhibition of IL-6- and IFN-γ-mediated JAK/STAT signaling.
Consistent with the established pharmacological activity of
CTP-543, a dose-related reduction in IL-6-stimulated phosphorylated
STAT3 was observed. Also, IFN-γ-mediated STAT1 signaling, which is
believed to play a key role in the pathogenesis of alopecia areata,
was significantly inhibited in disease-relevant immune cell types
at all doses evaluated.
- CTP-543 Phase 2 Initiation. The
Company intends to advance CTP-543 into a Phase 2a trial in
patients with moderate-to-severe alopecia areata in the first
quarter of 2017. Topline data from the trial is expected by
year-end 2017. The primary outcome measure of the Phase 2a trial
will be the effect on treating hair loss as measured by the
Severity of Alopecia Tool (SALT) after 24 weeks of dosing. The
trial will include an additional 28 weeks of dosing where all
patients enrolled in the study will receive CTP-543.
- General Counsel Transition. Dr.
Robert Silverman, General Counsel of Concert, has decided to
transition from the Company. Effective June 1, 2017, Lynette
Herscha, Vice President, Legal Affairs and Associate General
Counsel, will be promoted to General Counsel and Secretary,
succeeding Dr. Silverman. Dr. Silverman will remain a part-time
employee with the Company in a senior legal advisory role.
Full Year 2016 Financial Results
- Cash and Investments Position.
Cash, cash equivalents and investments as of December 31, 2016,
totaled $96.2 million as compared to $142.2 million as of December
31, 2015. Concert expects its cash, cash equivalents and
investments as of December 31, 2016, to be sufficient to fund the
Company through the second quarter of 2018. Upon closing of the
CTP-656 asset purchase agreement, pro forma cash is expected to be
sufficient to fund the Company into 2021.
- Revenues. Revenue was $174,000
for the year ended December 31, 2016, compared to $66.7 million for
the year ended December 31, 2015. The decrease in revenue relates
primarily to a one-time $50.2 million change in control payment
received from Auspex Pharmaceuticals in June 2015 as a result of
their acquisition by Teva Pharmaceuticals Ltd. The decrease in
revenue also relates to the completion of the Phase 1 clinical
evaluation under our strategic collaborations with Celgene
Corporation and Jazz Pharmaceuticals in 2015.
- R&D Expenses. Research and
development expenses were $37.0 million for the year ended December
31, 2016, compared to $28.9 million for the year ended December 31,
2015, an increase of $8.1 million. The increase in research and
development expenses was primarily due to expenses associated with
the development of the Company’s proprietary programs CTP-656 and
CTP-543.
- G&A Expenses. General and
administrative expenses were $14.4 million for the year ended
December 31, 2016, compared to $13.1 million for the year ended
December 31, 2015, an increase of $1.3 million. The increase in
general and administrative expenses was primarily attributable to a
$1.2 million increase in non-cash stock-based compensation
expense.
- Net (Loss) Income. For the year
ended December 31, 2016, net loss was $50.7 million, or $2.28 per
basic and diluted share, as compared to net income of $24.2
million, or $1.14 and $1.09 per basic and diluted share,
respectively, for the year ended December 31, 2015.
Conference Call and Webcast
The Company will host a conference call and webcast today at
8:30 a.m. EST to provide an update on the Company and discuss full
year 2016 financial results. To access the conference call, please
dial (855) 354-1855 (U.S. and Canada) or (484) 365-2865
(International) five minutes prior to the start time.
A live webcast may be accessed in the Investors section of the
company’s website at www.concertpharma.com. Please log on to the
Concert website approximately 15 minutes prior to the scheduled
webcast to ensure adequate time for any software downloads that may
be required. A replay of the webcast will be available on Concert’s
website for three months.
Concert Pharmaceuticals, Inc. Condensed Consolidated
Statements of Operations (in thousands, except per share
amounts)
Three Months EndedDecember
31,
Twelve Months EndedDecember
31,
2016 2015 2016 2015 Revenue: License
and research and development revenue
$
21 $ 305 $ 174 $ 6,574 Other revenue — — — 50,155 Milestone revenue
— 10,000 — 10,000 Total revenue 21
10,305 174 66,729 Operating expenses:
Research and development 8,658 6,386 36,983 28,885 General and
administrative 3,515 3,256 14,358 13,056
Total operating expenses 12,173 9,642 51,341
41,941 (Loss) Income from operations (12,152 ) 663
(51,167 ) 24,788 Interest and other income (expense), net 109
44 447 (185 ) (Loss) Income before income
taxes (12,043 ) 707 (50,720 ) 24,603 Provision for income taxes —
23 — 429 Net (loss) income $ (12,043 ) $ 684 $ (50,720 ) $
24,174 Net (loss) income per share applicable to common
stockholders - basic $ (0.54 ) $ 0.03 $ (2.28 ) $ 1.14
Net (loss) income per share applicable to common
stockholders - diluted $ (0.54 ) $ 0.03 $ (2.28 ) $ 1.09
Weighted-average number of common shares used in net (loss)
income per share applicable to common stockholders - basic 22,287
22,123 22,233 21,152 Weighted-average
number of common shares used in net (loss) income per share
applicable to common stockholders - diluted 22,287 23,302
22,233 22,267
Concert Pharmaceuticals, Inc.
Summary Balance Sheet Data (in thousands)
December 31, 2016 December 31, 2015 Cash and cash
equivalents $ 40,555 $ 92,510 Investments, available for sale
55,630 49,680 Working capital 92,159 137,481 Total assets 100,395
146,932 Deferred revenue 10,050 10,170 Total stockholders’ equity $
85,594 $ 130,635
About CTP-656 and Cystic Fibrosis
CTP-656 is a novel CFTR potentiator that may offer next
generation, once-daily dosing and was developed by Concert's novel
application of deuterium chemistry to modify ivacaftor. Ivacaftor
is marketed by Vertex Pharmaceuticals under the brand name
Kalydeco. Concert is initially developing CTP-656 as a potential
monotherapy treatment for cystic fibrosis due to gating mutations
of the gene that encodes for the cystic fibrosis transmembrane
conductance regulator (CFTR), a protein, which regulates components
of sweat, mucus clearance and digestion.
Cystic fibrosis is a life-threatening, hereditary genetic
disease that has systemic effects and can cause significantly
reduced lung and digestive system function. According to
the Cystic Fibrosis Foundation, an estimated 70,000 people
worldwide have cystic fibrosis.
About CTP-543 and Alopecia Areata
CTP-543 was discovered by applying Concert's deuterium chemistry
technology to modify ruxolitinib, which is commercially available
under the name Jakafi® in the United States for the
treatment of certain blood disorders. Ruxolitinib has been used to
treat alopecia areata in academic settings, including an
investigator-sponsored clinical trial, and has been shown to
promote hair growth in individuals with moderate to severe
disease.
Alopecia areata is an autoimmune disease that results in partial
or complete loss of hair on the scalp and body that may affect up
to 650,000 Americans at any given time. The scalp is the most
commonly affected area, but any hair-bearing site can be affected
alone or together with the scalp. Onset of the disease can occur
throughout life and affects both women and men. Alopecia areata can
be associated with serious psychological consequences, including
anxiety and depression. There are currently no drugs approved by
the U.S. Food and Drug Administration (FDA) for the
treatment of alopecia areata.
Additional Information about the Transactions and Where to
Find It
This press release is being made in respect of the proposed
asset sale with Vertex. The proposed asset sale and the asset
purchase agreement will be submitted to the shareholders of the
Company for their consideration and approval. In connection with
the proposed asset sale, the Company will file a proxy statement
with the SEC. This press release does not constitute a solicitation
of any vote or proxy from any shareholder of the Company. Investors
are urged to read the proxy statement carefully and in its entirety
when it becomes available and any other relevant documents or
materials filed or to be filed with the SEC or incorporated by
reference in the proxy statement, because they will contain
important information about the proposed asset sale. The definitive
proxy statement will be mailed to the Company’s shareholders. In
addition, the proxy statement and other documents will be available
free of charge at the SEC’s internet website, www.sec.gov. When
available, the proxy statement and other pertinent documents may
also be obtained free of charge at the Investors section of the
Company’s website, www.concertpharma.com, or by directing a written
request to Concert Pharmaceuticals, Inc., Attn: Investor Relations,
in writing, at 99 Hayden Ave, #500, Lexington, MA 02421.
The Company and its directors, executive officers and other
members of management and employees may be deemed to be
participants in the solicitation of proxies in connection with the
proposed asset sale. Information about the Company’s directors and
executive officers is included in the Company’s Annual Report on
Form 10-K for the year ended December 31, 2016 filed with the SEC
on March 6, 2017. Additional information regarding these persons
and their interests in the transaction will be included in the
proxy statement relating to the proposed asset sale when it is
filed with the SEC. These documents can be obtained free of charge
from the sources indicated above.
About Concert
Concert Pharmaceuticals is a clinical stage biopharmaceutical
company focused on applying its DCE Platform® (deuterated chemical
entity platform) to create novel medicines designed to address
unmet patient needs. The Company’s approach starts with approved
drugs in which deuterium substitution has the potential to enhance
clinical safety, tolerability or efficacy. Concert has a broad
pipeline of innovative medicines targeting pulmonary diseases,
including cystic fibrosis, autoimmune and inflammatory diseases and
central nervous systems (CNS) disorders. For more information
please visit www.concertpharma.com.
Cautionary Note on Forward Looking Statements
Any statements in this press release about our future
expectations, plans and prospects, including statements about the
asset purchase agreement, including risks related to the
satisfaction of the conditions to closing the acquisition, the
clinical development of our therapeutic candidates and expectations
regarding the sufficiency of our cash balance to fund operating
expenses and capital expenditures, and other statements containing
the words “anticipate,” “believe,” “continue,” “could,” “estimate,”
“expect,” “intend,” “may,” “plan,” “potential,” “predict,”
“project,” “should,” “target,” “would,” and similar expressions,
constitute forward-looking statements within the meaning of The
Private Securities Litigation Reform Act of 1995. Actual results
may differ materially from those indicated by such forward-looking
statements as a result of various important factors, including: the
uncertainties inherent in the initiation of future clinical trials,
availability and timing of data from ongoing and future clinical
trials and the results of such trials, whether preliminary results
from a clinical trial will be predictive of the final results of
that trial or whether results of early clinical trials will be
indicative of the results of later clinical trials, expectations
for regulatory approvals, availability of funding sufficient for
our foreseeable and unforeseeable operating expenses and capital
expenditure requirements and other factors discussed in the “Risk
Factors” section of our most recent Annual Report on Form 10-K
filed with the Securities and Exchange Commission and in other
filings that we make with the Securities and Exchange Commission.
In addition, any forward-looking statements included in this press
release represent our views only as of the date of this release and
should not be relied upon as representing our views as of any
subsequent date. We specifically disclaim any obligation to update
any forward-looking statements included in this press release.
Concert Pharmaceuticals Inc., the CoNCERT
Pharmaceuticals Inc. logo and DCE Platform are registered
trademarks of Concert Pharmaceuticals, Inc.Kalydeco is a registered
trademark of Vertex Pharmaceuticals, Inc.Jakafi is a registered
trademark of Incyte Corporation.
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version on businesswire.com: http://www.businesswire.com/news/home/20170306005317/en/
InvestorsConcert Pharmaceuticals, Inc.Justine Koenigsberg,
781-674-5284ir@concertpharma.comorMediaThe Yates NetworkKathryn
Morris, 845-635-9828
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