UPDATE: ARIAD 2015 Objectives and 2014 Preliminary Results

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ARIAD Pharmaceuticals, Inc.
ARIA
today announced its key strategic objectives for 2015, details of which will be presented at the 33rd Annual J.P. Morgan Healthcare Conference on January 14, 2015 in San Francisco, California. These objectives are focused on expanded commercial, research and development, and new business development initiatives that together are expected to lead ARIAD to sustained profitability beginning in 2018 without the need for additional equity capital to fund its operations. “We made excellent progress over the past year to successfully re-launch Iclusig® (ponatinib) in the U.S., to expand Iclusig's commercialization in Europe, and to better understand ponatinib's benefit/risk profile using lower doses,” said Harvey J. Berger, M.D., chairman and chief executive officer of ARIAD. “Additionally, we secured an experienced Japanese partner for Iclusig, an important step in expanding its global commercial opportunity. We also advanced our pipeline, moving brigatinib -- our investigational ALK inhibitor -- into a pivotal trial and nominating our next internally discovered oncology drug candidate -- AP32788 -- into development. As we begin 2015, we are focusing our investment on value-driving clinical initiatives and positioning the Company for solid growth with the key objective of achieving sustained profitability in three years.” ARIAD management will provide detail on its corporate strategy for the next several years. This new focus includes: Expanding the global commercial opportunity for Iclusig through a Japan/Asia partnership with Otsuka Pharmaceutical Co., Ltd., and additional regional distributorships, Leveraging its existing commercial infrastructure and investment, particularly in Europe, Securing a broad co-development and co-commercialization partnership for brigatinib (AP26113) that will accelerate the study of brigatinib in earlier lines of treatment, Investing in three randomized clinical trials to evaluate Iclusig in earlier lines of treatment and potentially to expand its addressable market, Advancing its new development candidate, AP32788, into the clinic, and Achieving sustained profitability in 2018 by reaching global product revenue of more than $400 million. Evaluating Iclusig in Earlier Lines of Chronic Myeloid Leukemia (CML) Three key Iclusig clinical trials will begin in 2015 including a randomized, Phase 3 trial in patients with chronic-phase CML (CP-CML) who have experienced failure after imatinib therapy. This second-line, global trial will evaluate two doses of Iclusig vs. the standard dose of nilotinib. The primary endpoint of the trial will be major molecular response (MMR) by 12 months. The trial is expected to open to patient enrollment in the second half of 2015 and will be integral to potentially expanding Iclusig into earlier lines of treatment. We expect that approximately 500 patients will be enrolled in this trial. We will begin patient enrollment in a dose-ranging, third-line trial of Iclusig in patients with CP-CML, who have become resistant to at least two prior tyrosine kinase inhibitors (TKIs). This global, randomized trial will evaluate three starting doses of Iclusig in patients with refractory CP-CML. The trial is expected to inform the optimal use of Iclusig in these patients and will begin by mid-2015. We expect that approximately 450 patients will be enrolled in this trial. An early-switch trial of Iclusig in second-line CP-CML patients will also begin in the United Kingdom. This investigator-sponsored trial (SPIRIT3) will be coordinated by the Newcastle University, U.K., on behalf of the U.K. National Cancer Research Institute (NCRI) CML Working Group. It will enroll newly diagnosed patients with CP-CML, who will be randomized to either imatinib or nilotinib. Patients failing to reach an early molecular response at three months will then be switched to Iclusig in the second line. We expect the trial to inform the use of Iclusig as part of the emerging paradigm in CML for early switching of TKIs in patients with suboptimal responses. We anticipate that the trial will begin in the first half of 2015 and will enroll approximately 1,000 patients. Clinical data presentations from the trial are anticipated at various times over several years. Securing a Broad Partnership for Brigatinib In a major strategic shift for ARIAD, we expect to secure a broad partnership in 2015 to co-develop and co-commercialize brigatinib. In doing so, we will continue to leverage our existing infrastructure and capabilities, allowing us to accelerate the start of a randomized, first-line trial of brigatinib vs. crizotinib. A partnership will also provide for the exploration of new combination therapies in lung cancer that include brigatinib potentially with other approved and unapproved medicines. Brigatinib received Breakthrough Therapy designation by the U.S. Food and Drug Administration in 2014 which may accelerate its regulatory approval timeline. Brigatinib is currently being evaluated in the global, Phase 2 pivotal ALTA trial that is anticipated to form the basis for its initial approval. We expect to achieve full patient enrollment in the ALTA trial in the third quarter 2015 and to file for approval of brigatinib in mid-2016. Expanding its Pipeline At the end of 2014, we nominated our next internally discovered development candidate, AP32788. This orally active TKI has a unique profile against a validated class of mutated targets in non-small cell lung cancer and certain other solid tumors and addresses an unmet medical need. We expect to file an investigational new drug (IND) application for AP32788 this year and to begin a Phase 1/2 proof-of-concept trial in 2016. This will be our third IND filing of an internally discovered oncology development candidate in the past eight years. This complements our earlier discovery of ridaforolimus, which is being developed by Medinol Ltd. for use in drug-eluting stents (BioNIR) and is in global pivotal trials, and rimiducid (AP1903), which is being developed by Bellicum Pharmaceuticals, Inc. for use in novel cellular immunotherapies and is in Phase 2 clinical trials. Path to Profitability We expect to achieve profitability in 2018 through revenue growth and strategic partnerships over the next three years. This includes Iclusig revenue growth in the U.S. and in Europe, as well as Iclusig revenue from Japan and new geographies. We also anticipate increased cash flow from brigatinib revenue and partnership payments during this time period. We expect approval of Iclusig in Canada and Israel in 2015 and in Japan in 2016. Strategic investments to support the long-term growth of the Company include its commercial presence in the U.S. and the 16 major European Union countries, the development of Iclusig in earlier lines of therapy, and the development of brigatinib and AP32788. Importantly, with a broad co-development and co-commercialization partnership for brigatinib, we do not anticipate a need for additional equity capital to fund operations. Based on this plan, we expect to achieve sustained profitability based on more than $400 million in anticipated product revenue in 2018. 2014 Key Financial Results In conjunction with the corporate strategy update, ARIAD will also highlight key financial results for full-year 2014. Estimated and unaudited financial results for full-year 2014 include: Net sales of Iclusig were approximately $55 million for the year ended December 31, 2014. License revenue was approximately $45 million for the year ended December 31, 2014. Research and development expenses were approximately $120 million for the full-year 2014 Selling, general and administrative expenses were approximately $140 million for the full-year 2014. As of December 31, 2014, cash and cash equivalents totaled approximately $350 million. Presentation Reminder As previously announced, our chairman and chief executive officer, Dr. Harvey J. Berger, will provide an overview of the Company at the 33rd Annual J.P. Morgan Healthcare Conference on January 14, 2015 in San Francisco, California, at 3:00 p.m. PT (6:00 p.m. ET), highlighting the Company's strategic operating plan. The ARIAD presentation will be webcast live and can be accessed by visiting the investor relations section of the Company's website at http://www.ariad.com/investor. A replay will be available on the ARIAD website approximately 24 hours after the presentation and will be archived for four weeks.
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