Heron Therapeutics Announces Financial Results for the Three and Twelve Months Ended December 31, 2019 and Highlights Recent Corporate Updates

SAN DIEGO, March 2, 2020 /PRNewswire/ -- Heron Therapeutics, Inc. HRTX, a commercial-stage biotechnology company focused on improving the lives of patients by developing best-in-class treatments to address some of the most important unmet patient needs, today announced financial results for the three and twelve months ended December 31, 2019 and highlighted recent corporate updates.

Recent Corporate Updates

Pain Management Franchise

  • New Drug Application for HTX-011: In September 2019, Heron resubmitted a New Drug Application (NDA) to the U.S. Food and Drug Administration (FDA) for HTX-011, an investigational agent for the management of postoperative pain. In February 2020, Heron announced that the FDA has extended the review period for the NDA for HTX-011 by up to three months. The new Prescription Drug User Fee Act (PDUFA) goal date is June 26, 2020.
  • Contract Manufacturing Site for HTX-011: In February 2020, Heron announced that the contract manufacturing site used to manufacture HTX-011 has been reinspected by the FDA with no Form 483 observations issued and with a recommendation by the FDA inspector for approval of the site. Heron has not been informed of any other manufacturing concerns.
  • Marketing Authorisation Application for HTX-011 in the European Union: In March 2019, Heron's Marketing Authorisation Application (MAA) for HTX-011 for the management of postoperative pain was validated by the European Medicines Agency (EMA) for review under the Centralised Procedure. An opinion from the EMA's Committee for Medicinal Products for Human Use (CHMP) is anticipated in the second quarter of 2020.
  • New Drug Submission for HTX-011 in Canada: In December 2019, Heron's New Drug Submission (NDS) for HTX-011 for the management of postoperative pain was granted Priority Review status and accepted by Health Canada. Health Canada's Priority Review status provides an accelerated 6-month review target for the NDS. A decision by Health Canada is anticipated in the third quarter of 2020.

CINV Franchise

  • CINV 2019 Net Product Sales: For the three months ended December 31, 2019, chemotherapy-induced nausea and vomiting (CINV) franchise net product sales were $35.1 million, up 22% from the same period in 2018. For the twelve months ended December 31, 2019, CINV franchise net product sales were $146.0 million, up 88% from the same period in 2018.
    • CINVANTI® Net Product Sales: Net product sales of CINVANTI (aprepitant) injectable emulsion for the three and twelve months ended December 31, 2019 were $34.6 million and $132.2 million, respectively, compared to $23.4 million and $56.2 million, respectively, for the same periods in 2018.
    • SUSTOL® Net Product Sales: Net product sales of SUSTOL (granisetron) extended-release injection for the three and twelve months ended December 31, 2019 were $0.5 million and $13.8 million, respectively, compared to $5.4 million and $21.3 million for the same periods in 2018. On October 1, 2019, the Company made a business decision to discontinue all discounting of SUSTOL, which resulted in significantly lower SUSTOL net product sales.
  • 2020 Net Product Sales Guidance: Heron expects 2020 net product sales for the CINV franchise of $70 million to $80 million and the CINV franchise to return to growth in 2021 and beyond.

"We have made important advances in 2019 in both our pain management and CINV franchises, highlighted by the advancement of HTX-011 toward marketing approvals and strong sales for our CINV franchise," said Barry Quart, Pharm.D., President and Chief Executive Officer of Heron Therapeutics. "We look forward to launching HTX-011 for postoperative pain management in the second half of 2020, pending FDA approval."

Financial Results

Net product sales for the three and twelve months ended December 31, 2019 were $35.1 million and $146.0 million, respectively, compared to $28.8 million and $77.5 million, respectively, for the same periods in 2018.

Heron's net loss for the three and twelve months ended December 31, 2019 was $57.9 million and $204.7 million, or $0.65 per share and $2.50 per share, respectively, compared to $49.6 million and $178.8 million, or $0.63 per share and $2.44 per share, respectively, for the same periods in 2018. Net loss for the three and twelve months ended December 31, 2019 included non-cash, stock-based compensation expense of $11.1 million and $51.4 million, respectively, compared to $9.8 million and $33.4 million, respectively, for the same periods in 2018.

As of December 31, 2019, Heron had cash, cash equivalents and short-term investments of $391.0 million compared to $332.4 million as of December 31, 2018. Net cash used for operating activities for the twelve months ended December 31, 2019 was $124.6 million, compared to $191.8 million for the same period in 2018. Heron expects that its current cash, cash equivalents and short-term investments will be sufficient to fund its operations into 2022.

About HTX-011 for Postoperative Pain

HTX-011, an investigational agent, is a dual-acting, fixed-dose combination of the local anesthetic bupivacaine with a low dose of the nonsteroidal anti-inflammatory drug meloxicam. It is the first and only extended-release local anesthetic to demonstrate in Phase 3 studies significantly reduced pain and opioid use through 72 hours compared to bupivacaine solution, the current standard-of-care local anesthetic for postoperative pain control. HTX-011 was granted Fast Track designation from the U.S. Food and Drug Administration (FDA) in the fourth quarter of 2017 and Breakthrough Therapy designation in the second quarter of 2018. Heron submitted a New Drug Application (NDA) to the FDA for HTX-011 in October of 2018 and received Priority Review designation in December of 2018. A Complete Response Letter (CRL) was received from the FDA regarding the NDA for HTX-011 on April 30, 2019 relating to chemistry, manufacturing and controls and non-clinical information. No issues related to clinical efficacy or safety were noted. Heron resubmitted an NDA to the FDA for HTX-011 in September 2019. The Prescription Drug User Fee Act (PDUFA) goal date is June 26, 2020. A Marketing Authorisation Application (MMA) for HTX-011 was validated by the European Medicines Agency (EMA) in March 2019 for review under the Centralised Procedure. Heron's New Drug Submission (NDS) for HTX-011 for the management of postoperative pain was granted Priority Review status by Health Canada in October 2019 and accepted by Health Canada in November 2019.

About CINVANTI (Aprepitant) Injectable Emulsion

CINVANTI, in combination with other antiemetic agents, is indicated in adults for the prevention of acute and delayed nausea and vomiting associated with initial and repeat courses of highly emetogenic cancer chemotherapy (HEC) including high-dose cisplatin as a single-dose regimen, delayed nausea and vomiting associated with initial and repeat courses of moderately emetogenic cancer chemotherapy (MEC) as a single-dose regimen, and nausea and vomiting associated with initial and repeat courses of MEC as a 3-day regimen. CINVANTI is an IV formulation of aprepitant, a substance P/neurokinin-1 (NK1) receptor antagonist (RA). CINVANTI is the first IV formulation to directly deliver aprepitant, the active ingredient in EMEND® capsules. Aprepitant (including its prodrug, fosaprepitant) is the only single-agent NK1 RA to significantly reduce nausea and vomiting in both the acute phase (0–24 hours after chemotherapy) and the delayed phase (24–120 hours after chemotherapy). The FDA-approved dosing administration included in the United States prescribing information for CINVANTI is a 30-minute IV infusion or a 2-minute IV injection.

Please see full prescribing information at www.CINVANTI.com.

About SUSTOL (Granisetron) Extended-Release Injection

SUSTOL is indicated in combination with other antiemetics in adults for the prevention of acute and delayed nausea and vomiting associated with initial and repeat courses of moderately emetogenic chemotherapy (MEC) or anthracycline and cyclophosphamide (AC) combination chemotherapy regimens. SUSTOL is an extended-release, injectable 5-HT3 receptor antagonist that utilizes Heron's Biochronomer® drug delivery technology to maintain therapeutic levels of granisetron for ≥5 days. The SUSTOL global Phase 3 development program was comprised of two, large, guideline-based clinical studies that evaluated SUSTOL's efficacy and safety in more than 2,000 patients with cancer. SUSTOL's efficacy in preventing nausea and vomiting was evaluated in both the acute phase (0–24 hours after chemotherapy) and delayed phase (24–120 hours after chemotherapy).

Please see full prescribing information at www.SUSTOL.com.

About Heron Therapeutics, Inc.

Heron Therapeutics, Inc. is a commercial-stage biotechnology company focused on improving the lives of patients by developing best-in-class treatments to address some of the most important unmet patient needs. Heron is developing novel, patient-focused solutions that apply its innovative science and technologies to already-approved pharmacological agents for patients suffering from pain or cancer.

For more information, visit www.herontx.com.

Forward-looking Statements

This news release contains "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995. Heron cautions readers that forward-looking statements are based on management's expectations and assumptions as of the date of this news release and are subject to certain risks and uncertainties that could cause actual results to differ materially, including, but not limited to, those associated with: whether the U.S. Food and Drug Administration (FDA) approves the New Drug Application (NDA) for HTX-011; the timing of the commercial launch of HTX-011; the timing of the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) review process for HTX-011; whether the European Commission (EC) authorizes the Marketing Authorisation Application (MAA) for HTX-011; the timing of Health Canada's New Drug Submission (NDS) review process for HTX-011; whether Health Canada issues a Notice of Compliance for the NDS for HTX-011; the expected future balances of Heron's cash, cash equivalents and short-term investments; the expected duration over which Heron's cash, cash equivalents and short-term investments balances will fund its operations; and other risks and uncertainties identified in the Company's filings with the U.S. Securities and Exchange Commission. Forward-looking statements reflect our analysis only on their stated date, and Heron takes no obligation to update or revise these statements except as may be required by law.

 

HERON THERAPEUTICS, INC.

Consolidated Balance Sheets

(In thousands, except par value amounts)







December 31,

2019





December 31,

2018











ASSETS

















Current assets:

















Cash and cash equivalents



$

71,898





$

31,836



Short-term investments





319,074







300,535



Accounts receivable, net





39,879







64,652



Inventory





24,968







39,032



Prepaid expenses and other current assets





23,245







11,193



Total current assets





479,064







447,248



Property and equipment, net





19,618







14,677



Right-of-use lease assets





13,754









Other assets





346







254



Total assets



$

512,782





$

462,179



LIABILITIES AND STOCKHOLDERS' EQUITY

















Current liabilities:

















Accounts payable



$

2,758





$

16,863



Accrued clinical and manufacturing liabilities





34,614







24,470



Accrued payroll and employee liabilities





15,248







13,397



Other accrued liabilities





36,535







32,715



Current lease liabilities





1,926









Convertible notes payable to related parties, net of discount





5,624







4,574



Total current liabilities





96,705







92,019



Non-current lease liabilities





12,242









Total liabilities





108,947







92,019



Commitments and contingencies

















Stockholders' equity:

















Preferred stock, $0.01 par value: 2,500 shares authorized; no shares issued or outstanding at December 31, 2019 and 2018













Common stock, $0.01 par value: 150,000 shares authorized; 90,304 and 78,174 shares issued and outstanding at December 31, 2019 and 2018, respectively





903







782



Additional paid-in capital





1,568,317







1,330,186



Accumulated other comprehensive income (loss)





85







(87)



Accumulated deficit





(1,165,470)







(960,721)



Total stockholders' equity





403,835







370,160



Total liabilities and stockholders' equity



$

512,782





$

462,179



 

HERON THERAPEUTICS, INC.

Condensed Consolidated Statements of Operations

(In thousands, except per share amounts)





Three Months Ended

December 31,



          Twelve Months Ended

December 31,



2019



2018



2019



2018



(unaudited)









Revenues:















    Net product sales

$    35,083



$      28,844



$  145,968



$   77,474

Operating expenses:















    Cost of product sales

15,874



11,572



61,619



27,512

    Research and development

48,277



39,891



167,382



140,032

    General and administrative

9,874



8,738



37,897



29,263

    Sales and marketing

20,420



19,957



89,764



64,604

          Total operating expenses

94,445



80,158



356,662



261,411

















Loss from operations

(59,362)



(51,314)



(210,694)



(183,937)

















Other income, net

1,442



1,755



5,945



5,097

















Net loss

$   (57,920)



$      (49,559)



$  (204,749)



$  (178,840)

















Basic and diluted net loss per share

$       (0.65)



$          (0.63)



$        (2.50)



$        (2.44)

















Shares used in computing basic and diluted net loss per share

89,112



78,086



81,779



73,193

 

HERON THERAPEUTICS, INC.

Consolidated Statements of Cash Flows

(In thousands)







Years Ended December 31,







2019





2018





2017











Operating activities:

























Net loss



$

(204,749)





$

(178,840)





$

(197,484)



Adjustments to reconcile net loss to net cash used for operating activities:

























Stock-based compensation expense





51,411







33,367







30,538



Depreciation and amortization





2,044







1,513







1,531



Amortization of debt discount





1,050







890







773



Accretion of discount on short-term investments





(3,730)







(3,412)







(278)



Realized gain on available-for-sale investments





(8)















Impairment of property and equipment





107







72









Loss on disposal of property and equipment





62







29







39



Change in operating assets and liabilities:

























Accounts receivable





24,773







(22,778)







(39,914)



Prepaid expenses and other assets





(12,052)







(7,482)







3



Inventory





14,064







(29,122)







(4,768)



Accounts payable





(14,105)







(1,906)







11,955



Accrued clinical and manufacturing liabilities





10,144







(3,614)







13,713



Accrued payroll and employee liabilities





1,851







4,537







446



Deferred revenue

















1,664



Other accrued liabilities





4,558







14,941







11,482



Net cash used for operating activities





(124,580)







(191,805)







(170,300)



Investing activities:

























Purchases of short-term investments





(477,035)







(497,104)







(121,570)



Maturities and sales of short-term investments





462,406







227,700







131,783



Purchases of property and equipment





(7,154)







(9,171)







(2,553)



Proceeds from the sale of property and equipment











25







78



Net cash (used for) provided by investing activities





(21,783)







(278,550)







7,738



Financing activities:

























Net proceeds from sale of common stock and/or pre-funded warrants





162,151







363,128







306,279



Proceeds from purchases under the Employee Stock Purchase Plan





2,109







1,179







989



Proceeds from stock option exercises





22,164







18,301







11,463



Proceeds from warrant exercises





1















Repayment of promissory note payable to related party











(25,000)







(25,000)



Net cash provided by financing activities





186,425







357,608







293,731



Net increase (decrease) in cash and cash equivalents





40,062







(112,747)







131,169



Cash and cash equivalents at beginning of year





31,836







144,583







13,414



Cash and cash equivalents at end of year



$

71,898





$

31,836





$

144,583



Supplemental disclosure of cash flow information:

























Interest paid



$





$

1,183





$

2,789



Cumulative effect of adoption of new accounting standard



$





$

1,574





$



Investor Relations and Media Contact:

David Szekeres

Chief Legal, Business and Administrative Officer

Heron Therapeutics, Inc.

dszekeres@herontx.com 

858-251-4447

Cision View original content:http://www.prnewswire.com/news-releases/heron-therapeutics-announces-financial-results-for-the-three-and-twelve-months-ended-december-31-2019-and-highlights-recent-corporate-updates-301013982.html

SOURCE Heron Therapeutics, Inc.

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