Clarus Therapeutics Holdings, Inc. (Clarus) (Nasdaq:CRXT), a
pharmaceutical company dedicated to providing solutions to unmet
medical needs by advancing androgen and metabolic therapies, today
reported financial results for the second quarter of 2022. Clarus
also announced that it is pursuing an immediate reduction in staff
as it evaluates strategic alternatives and terminates certain
research and development activities.
“Although Clarus delivered another quarter of steady growth in
net revenue driven by demand for JATENZO,” said Dr. Robert Dudley,
President and Chief Executive Officer of Clarus, “it is important
for us to make certain strategic changes to our business due to the
difficult financing environment we face. These changes will include
staff reductions at all levels, including field sales personnel,
coupled with significant reductions in promotional and other
operational spend, including in our planned research and
development activities. Despite these difficult choices, we believe
it is the responsible course of action. I would like to extend my
sincere gratitude and thanks to all of Clarus’ staff for their
significant contributions and unwavering commitment to advancing
Clarus’ mission. In particular, I want to thank Ric Peterson, who
is transitioning out of his role as Chief Financial Officer. Steve
Bourne, Clarus’ Chief Administrative Officer (and former Chief
Financial Officer), will become Clarus’ Chief Financial
Officer.”
Recent Business Highlights- Increased total
prescriptions for JATENZO in the second quarter of 2022
sequentially and year-over-year by 23% and 72%, respectively,
driven primarily by advertising and promotion and an increase in
payer coverage across all payer channels - Submitted new data for
JATENZO that was presented at recent medical conferences to a
peer-reviewed journal for publication- Received a notice of
allowance from the U.S. Patent and Trademark Office (USPTO) for
additional patent claims covering JATENZO; once issued, this will
be the ninth patent for JATENZO to be listed in the U.S. Food and
Drug Administration’s (FDA) Orange Book- Continued to explore
strategic alternatives to maximize stockholder value- Implemented
workforce reduction of approximately 40% of total headcount,
including sales personnel, expected to be completed in August 2022-
Named Steve Bourne as Chief Financial Officer, effective August 31,
2022, when Ric Peterson leaves the
company - Terminated agreement with HavaH
Therapeutics for the development of CLAR-121 (testosterone +
anastrozole) for the treatment of inflammatory breast disease and
certain forms of breast cancer
Second Quarter Financial Results HighlightsFor
the three months ended June 30, 2022, net revenue increased 45.7%
to $4.1 million from $2.8 million in the same period last year. For
the six months ended June 30, 2022, net revenue increased 57.8% to
$8.1 million from $5.1 million in the same period last year, in
each case related to the growth in sales of JATENZO.
Gross margin was 71.4% for the three months ended June 30, 2022,
compared to 80.1% for the prior year period. Gross margin was 77.4%
for the six months ended June 30, 2022, compared to 82.0% for the
prior year period. Gross margins decreased for the three months and
six months ended June 30, 2022 as the result of a $0.4 million
charge in the second quarter related to purchases made to comply
with the product supply contract.
For the three months ended June 30, 2022, operating expenses
decreased by 12.4% to $13.5 million from $15.5 million in the same
period last year, primarily attributed to decreases in sales and
marketing expenses. For the six months ended June 30, 2022,
operating expenses increased by 7.9% to $30.4 million from $28.2
million in the same period last year, driven by increased headcount
and professional fees associated with financing activities and
operating as a public company and an increase in sales and
marketing expenses.
Included in total operating expenses for the three months ended
June 30, 2022, was a decrease in sales and marketing expenses of
29.8% to $6.7 million from $9.5 million in the same period last
year, primarily attributed to the timing of advertising and
promotional spend associated with JATENZO and a decrease in both
patient assistance and market research costs associated with the
brand. For the six months ended June 30, 2022, sales and marketing
expenses were $17.4 million compared to $17.5 million in the same
period last year, primarily attributed to an increase in sales and
marketing costs offset by timing of advertising and promotional
spend associated with JATENZO and a decrease in market research
costs associated with the brand.
Also included in total operating expenses for the three months
ended June 30, 2022, was an increase in general and administrative
expenses of 5.6% to $5.6 million from $5.3 million in the same
period last year, primarily attributed to an increase in headcount
and consulting costs associated with a growing business and costs
associated with being a public company. For the six months ended
June 30, 2022, general and administrative expenses increased by
22.1% to $10.9 million from $8.9 million in the same period last
year, primarily attributed to an increase in headcount and
consulting costs, and an increase in public company costs.
Total operating expenses for the three months ended June 30,
2022, also reflect an increase in research and development expenses
of 102.8% to $1.2 million from $0.6 million in the same period last
year, primarily attributed to ongoing clinical costs associated
with our lead commercial asset. For the six months ended June 30,
2022, research and development expenses increased by 16.1% to $2.1
million from $1.8 million in the same period last year, primarily
attributed to an increase in personnel costs.
For the three months ended June 30, 2022, net loss was $10.7
million, or $0.24 per common share (basic and diluted), compared to
a net loss of $18.1 million, or $0.00 per common share (basic and
diluted) in the same period last year. For the six months ended
June 30, 2022, net loss was $25.6 million, or $0.75 per common
share (basic and diluted), compared to net income of $33.5 million,
or $0.00 per common share (basic and diluted) in the same period
last year.
As of June 30, 2022, Clarus had cash and cash equivalents of
$19.2 million with an accumulated deficit of $347.2 million and
$40.5 million of senior notes payable. Management believes that our
existing cash and cash equivalents of $19.2 million as of June 30,
2022, along with revenue generated from sales of JATENZO, will fund
our current estimated operating expenses (after implementation of
our headcount reduction) and capital expenditure requirements into
September 2022. If we are not able to restructure our indebtedness
and obtain necessary capital, we may be required to discontinue our
commercialization efforts for JATENZO, liquidate all or a portion
of our assets and/or seek protection under the provisions of the
U.S. Bankruptcy Code. These matters raise substantial doubt
about our ability to continue as a going concern.
About Clarus Therapeutics Holdings, Inc.Clarus
Therapeutics Holdings, Inc. is a pharmaceutical company with
expertise in developing androgen and metabolic therapies –
including potential therapies for orphan indications. Clarus
Therapeutics’ first commercial product is JATENZO (testosterone
undecanoate). For more information, visit
www.clarustherapeutics.com and www.jatenzo.com. Follow us on
Twitter (@Clarus_Thera) and LinkedIn (Clarus Therapeutics).
Clarus Forward-Looking StatementsCertain
statements in this press release constitute “forward-looking
statements” for purposes of the federal securities laws. The words
“anticipate,” “believe,” “contemplate,” “continue,” “could,”
“estimate,” “expect,” “intends,” “may,” “might,” “plan,”
“possible,” “potential,” “predict,” “project,” “should,” “will,”
“would” and similar expressions may identify forward-looking
statements, but the absence of these words does not mean that a
statement is not forward-looking. Clarus’ forward-looking
statements in this press release include, but are not limited to,
statements about the implementation of the workforce reduction,
exploration of strategic alternatives, JATENZO performance in the
marketplace given expanded competition, and expectations regarding
Clarus’ cash runway and potential outcomes if it is unable to raise
capital or restructure its indebtedness, among others. These
forward-looking statements are based on current expectations and
beliefs concerning future developments and their potential effects.
There can be no assurance that future developments affecting Clarus
will be those anticipated. These forward-looking statements involve
a number of risks, uncertainties (some of which are beyond Clarus’
control) or other assumptions that may cause actual results or
performance to be materially different from those expressed or
implied by these forward-looking statements. These risks and
uncertainties include, but are not limited to, the risks associated
with Clarus’ financial position and indebtedness, risks associated
with pursuing strategic alternatives, as well as risks associated
with pharmaceutical development and being a pharmaceutical company
generally, along with those factors described under the heading
“Risk Factors” in Clarus’ annual report on 10-K for the year ended
December 31, 2021, filed with the Securities and Exchange
Commission (the SEC) on March 31, 2022, and those that are
included in any of Clarus’ future filings with the SEC. Some of
these risks and uncertainties may in the future be amplified by the
ongoing COVID-19 pandemic and there may be additional risks that
Clarus considers immaterial, or which are unknown. It is not
possible to predict or identify all such risks. Clarus’
forward-looking statements only speak as of the date they are made,
and Clarus does not undertake any obligation to update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required
under applicable securities laws.
JATENZO® is a registered trademark of Clarus Therapeutics
Holdings, Inc.
Clarus Contact:Kara StancellVice President,
Investor Relations & Corporate
Communicationskstancell@clarustherapeutics.com(847) 562-4300 x
206
The following presents Clarus Therapeutics Holdings, Inc.
statements of operations for the three and six months ended June
30, 2022 and 2021:
|
CLARUS THERAPEUTICS HOLDINGS,
INC.Condensed Consolidated Statements of
Operations (unaudited)(in thousands, except share and per
share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net product revenue |
$ |
4,050 |
|
|
$ |
2,779 |
|
|
$ |
8,061 |
|
|
$ |
5,109 |
|
Cost of product sales |
|
1,160 |
|
|
|
554 |
|
|
|
1,823 |
|
|
|
921 |
|
Gross profit |
|
2,890 |
|
|
|
2,225 |
|
|
|
6,238 |
|
|
|
4,188 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing |
|
6,688 |
|
|
|
9,530 |
|
|
|
17,418 |
|
|
|
17,467 |
|
General and administrative |
|
5,625 |
|
|
|
5,327 |
|
|
|
10,910 |
|
|
|
8,932 |
|
Research and development |
|
1,229 |
|
|
|
606 |
|
|
|
2,110 |
|
|
|
1,817 |
|
Total operating expenses |
|
13,542 |
|
|
|
15,463 |
|
|
|
30,438 |
|
|
|
28,216 |
|
Loss from operations |
|
(10,652 |
) |
|
|
(13,238 |
) |
|
|
(24,200 |
) |
|
|
(24,028 |
) |
Other (expense) income,
net: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of warrant liability |
|
728 |
|
|
|
— |
|
|
|
1,370 |
|
|
|
— |
|
Interest income |
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
Interest expense |
|
(2,020 |
) |
|
|
(4,877 |
) |
|
|
(3,985 |
) |
|
|
(9,517 |
) |
Litigation settlement |
|
1,250 |
|
|
|
— |
|
|
|
1,250 |
|
|
|
— |
|
Total other (expense) income, net |
|
(42 |
) |
|
|
(4,877 |
) |
|
|
(1,364 |
) |
|
|
(9,517 |
) |
Net loss before income
taxes |
|
(10,694 |
) |
|
|
(18,115 |
) |
|
|
(25,564 |
) |
|
|
(33,545 |
) |
Provision for income
taxes |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Net loss |
|
(10,694 |
) |
|
|
(18,115 |
) |
|
|
(25,564 |
) |
|
|
(33,545 |
) |
Accretion of preferred
stock |
|
— |
|
|
|
(3,798 |
) |
|
|
— |
|
|
|
(7,737 |
) |
Net loss attributable to
common stockholders – basic and diluted |
$ |
(10,694 |
) |
|
$ |
(21,913 |
) |
|
$ |
(25,564 |
) |
|
$ |
(41,282 |
) |
Net loss per common share
attributable to common stockholders, basic and diluted |
$ |
(0.24 |
) |
|
$ |
— |
|
|
$ |
(0.75 |
) |
|
$ |
— |
|
Weighted-average common shares
used in net loss per share attributable to common stockholders,
basic and diluted |
|
44,229,097 |
|
|
|
— |
|
|
|
34,271,291 |
|
|
|
— |
|
|
|
|
|
|
|
CLARUS THERAPEUTICS HOLDINGS,
INC.Condensed Consolidated Balance Sheets
(unaudited)(in thousands, except share and per
share data) |
|
|
|
|
|
|
|
|
|
June 30, |
|
December 31, |
|
2022 |
|
2021 |
Assets |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
19,173 |
|
|
$ |
26,415 |
|
Accounts receivable, net |
|
8,705 |
|
|
|
6,341 |
|
Inventory, net |
|
16,805 |
|
|
|
14,214 |
|
Prepaid expenses |
|
4,197 |
|
|
|
4,673 |
|
Total current assets |
|
48,880 |
|
|
|
51,643 |
|
Property and equipment,
net |
|
60 |
|
|
|
65 |
|
Total assets |
$ |
48,940 |
|
|
$ |
51,708 |
|
Liabilities and
stockholders' deficit |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
Senior notes payable |
$ |
40,505 |
|
|
$ |
42,269 |
|
Accounts payable |
|
8,488 |
|
|
|
13,945 |
|
Accrued expenses |
|
9,834 |
|
|
|
8,261 |
|
Deferred revenue |
|
2,979 |
|
|
|
1,585 |
|
Total current liabilities |
|
61,806 |
|
|
|
66,060 |
|
Derivative warrant
liability |
|
197 |
|
|
|
1,567 |
|
Total liabilities |
|
62,003 |
|
|
|
67,627 |
|
Commitments and
contingencies |
|
|
|
|
|
|
|
Stockholders’ deficit: |
|
|
|
|
|
|
|
Preferred stock, $0.0001 par
value; 10,000,000 shares authorized; no shares issued and
outstanding at June 30, 2022 and December 31, 2021,
respectively |
|
— |
|
|
|
— |
|
Common stock, $0.001 par
value; 500,000,000 and 125,000,000 shares authorized at June 30,
2022 and December 31, 2021, respectively; 52,020,731 and 24,025,817
shares issued and outstanding at June 30, 2022 and December 31,
2021, respectively |
|
5 |
|
|
|
2 |
|
Additional paid-in capital |
|
334,151 |
|
|
|
305,734 |
|
Accumulated deficit |
|
(347,219 |
) |
|
|
(321,655 |
) |
Total stockholders’ deficit |
|
(13,063 |
) |
|
|
(15,919 |
) |
Total liabilities and stockholders’ deficit |
$ |
48,940 |
|
|
$ |
51,708 |
|
Clarus Therapeutics (NASDAQ:CRXT)
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Clarus Therapeutics (NASDAQ:CRXT)
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