UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 8, 2016
ENANTA PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 001-35839 | 04-3205099 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
500 Arsenal Street, Watertown, Massachusetts 02472
(Address of principal executive offices and zip code)
(617) 607-0800
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(e) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 2.02 | Results of Operations and Financial Condition. |
On February 8, 2016, Enanta Pharmaceuticals, Inc. announced via press release its results for the quarter ended December 31, 2015. A copy of Enanta’s press release is hereby furnished to the Commission and incorporated by reference herein as Exhibit 99.1.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit |
Description | |
| 99.1 | Press Release of Enanta Pharmaceuticals, Inc., dated February 8, 2016, reporting Enanta’s financial results for the quarter ended December 31, 2015. | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: February 8, 2016 | ENANTA PHARMACEUTICALS, INC. | |||||
| By: | /s/ Paul J. Mellett | |||||
| Paul J. Mellett | ||||||
| Senior Vice President, Finance and Administration and Chief Financial Officer | ||||||
EXHIBIT INDEX
| Exhibit |
Description | |
| 99.1 | Press Release of Enanta Pharmaceuticals, Inc., dated February 8, 2016, reporting Enanta’s financial results for the quarter ended December 31, 2015. | |
Exhibit 99.1
For Immediate Release
Enanta Pharmaceuticals Reports Financial Results for its
Fiscal First Quarter Ended December 31, 2015
Conference Call and Webcast Today at 4:30 p.m. ET
| • | Royalty revenue for paritaprevir containing regimens was $17.9 million |
| • | $30 million milestone payment received from AbbVie for reimbursement approval in Japan for VIEKIRAX® |
| • | Cash and marketable securities totaled $236.6 million at December 31, 2015 |
WATERTOWN, Mass., February 8, 2016 — Enanta Pharmaceuticals, Inc., (NASDAQ:ENTA), a research and development-focused biotechnology company dedicated to creating small molecule drugs for viral infections and liver diseases, today reported financial results for its fiscal first quarter ended December 31, 2015.
Enanta’s cash, cash equivalents and short-term and long-term marketable securities totaled $236.6 million at December 31, 2015. This compares to a total of $209.4 million in such accounts at September 30, 2015. Enanta expects that its current cash, cash equivalents and marketable securities will be sufficient to meet the anticipated cash requirements of its existing business for the foreseeable future.
Fiscal First Quarter Ended December 31, 2015 Financial Results
Revenue for the three months ended December 31, 2015 was $48.4 million, compared to $77.5 million for the three months ended December 31, 2014. For the 2015 period, revenue consisted primarily of a $30 million milestone payment earned and received from AbbVie for reimbursement approval of VIEKIRAX® in Japan, as well as royalties earned on contractually specified portions of AbbVie’s worldwide net sales of hepatitis C virus (HCV) treatment regimens containing paritaprevir, Enanta’s lead protease inhibitor identified within the ongoing AbbVie-Enanta collaboration. Revenue in the 2014 period consisted primarily of a $75 million milestone payment received in the period ended December 31, 2014 for the initial commercialization regulatory approval of VIEKIRA PAK® in the U.S. Milestone payments, royalties and other payments from collaborations have varied significantly from period to period, and are expected to continue to do so.
Research and development expenses totaled $9.0 million for the three months ended December 31, 2015, compared to $4.5 million for the three months ended December 31, 2014. The increase in the three month period over the prior year period was primarily due to increased pre-clinical and clinical costs associated with Enanta’s wholly-owned R&D programs in NASH, RSV, HBV and HCV cyclophilin.
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General and administrative expenses totaled $3.8 million for the three months ended December 31, 2015, compared to $2.8 million for the three months ended December 31, 2014. The increase in the 2015 period primarily reflects increases in stock-based compensation expense, as well as additional expenses incurred as Enanta expands its operations.
Net income for the three months ended December 31, 2015 was $26.2 million, or $1.36 per diluted common share, compared to net income of $42.0 million or $2.18 per diluted common share, for the corresponding period in 2014.
“Sustained by Enanta’s financial resources generated by our HCV collaboration product, 2016 will be a year in which Enanta continues to diversify beyond our partnered and wholly-owned HCV programs and advances its internal programs in NASH, hepatitis B virus and respiratory syncytial virus,” commented Jay R. Luly, Ph.D., President and Chief Executive Officer. “We expect to advance our NASH program into clinical development this year and look forward to sharing updates on these new programs in the coming months.”
Development Program and Business Review
| • | In January Enanta dosed the first subject in its phase 1 clinical study of EDP-494, Enanta’s wholly-owned cyclophilin inhibitor being developed for the treatment of hepatitis C virus (HCV). |
| • | In January, Enanta announced that it has expanded its research and development programs within the company’s core focus areas of virology and liver disease to include new programs to treat hepatitis B virus (HBV) and Respiratory Syncytial Virus (RSV) infections. Preclinical candidate selection is ongoing with a goal to initiate clinical studies for at least one of these programs in 2017. |
| • | Enanta is on track to initiate a phase 1 clinical trial in the second half of 2016 with EDP-305, Enanta’s wholly-owned Farnesoid X Receptor (FXR) agonist candidate for non-alcoholic steatohepatitis (NASH) and Primary Biliary Cholangitis (PBC). |
| • | AbbVie has initiated six global phase 3 clinical studies of its next-generation HCV treatment regimen, which includes ABT-493, Enanta’s next-generation protease inhibitor. |
Revenue Guidance
For the quarter ending March 31, 2016, which marks the beginning of a new year for the calculation of Enanta’s annually tiered royalties, Enanta expects its royalty revenue to be at least 3% percent of AbbVie’s reported VIEKIRA sales. The actual percentage will depend primarily on the amounts and portions of those sales that are 2-DAA or 3-DAA regimen sales. Under its agreement with AbbVie, Enanta is entitled to receive annually tiered, double-digit royalties on specified portions of sales that are allocated to paritaprevir using 30% of 3-DAA sales (VIEKIRA PAK™ or VIEKIRAX® + EXVIERA®) and 45% of 2-DAA sales (TECHNIVIE® or VIEKIRAX®) for the allocation.
Upcoming Events and Presentations
| • | February 10, 2016 - Leerink Partners 5th Annual Global Healthcare Conference, New York, NY |
| • | February 11, 2016 at 4:00 p.m. ET - Enanta 2016 Annual Meeting of Stockholders, Boston, MA |
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| • | March 17, 2016 - Barclays Global Health Care Conference, Miami, FL |
| • | Enanta plans to issue its fiscal second quarter financial results press release, and hold a conference call regarding those results, in the week of May 9, 2016. |
Conference Call and Webcast Information
Enanta will host
a conference call and webcast today at 4:30 p.m. ET. To participate in the live conference call, please dial
(855) 840-0595 in the U.S. or (518) 444-4814 for international callers. A replay of the conference call will be available
starting at approximately 6:30 p.m. Eastern time on February 8, 2016, through 11:59 p.m. Eastern time on February 12, 2016 by dialing (855) 859-2056 from the U.S. or (404) 537-3406 for international callers. The passcode for both
the live call and the replay is 36743436. A live audio webcast of the call and replay can be accessed by visiting the “Calendar of Events” section on the “Investors” page of Enanta’s website at www.enanta.com.
About Enanta
Enanta Pharmaceuticals is a research and development-focused biotechnology company that uses its robust chemistry-driven approach and drug discovery capabilities to create small molecule drugs for viral infections and liver diseases. Enanta’s research and development is currently focused on four disease targets: Hepatitis C Virus (HCV), Hepatitis B Virus (HBV), Non-alcoholic Steatohepatitis (NASH) and Respiratory Syncytial Virus (RSV).
Enanta has developed novel protease inhibitors and NS5A inhibitors that are members of the direct-acting-antiviral (DAA) inhibitor classes designed for use against the hepatitis C virus (HCV). Enanta’s protease inhibitors, developed through its collaboration with AbbVie, include paritaprevir, which is contained in AbbVie’s marketed DAA regimens for HCV, and ABT-493, Enanta’s next-generation protease inhibitor, which AbbVie is developing in phase 3 studies in combination with ABT-530, AbbVie’s next-generation NS5A inhibitor. Enanta has also discovered a cyclophilin inhibitor, EDP-494, a novel host-targeting mechanism for HCV, which is now in phase 1 clinical development, and EDP-305, an FXR agonist, which Enanta plans to advance into clinical development for NASH later in 2016. Please visit www.enanta.com for more information on Enanta’s programs and pipeline.
Forward Looking Statements Disclaimer
This press release contains forward-looking statements, including statements with respect to the prospects for future royalties on sales of AbbVie’s HCV treatment regimens containing paritaprevir, the prospects for AbbVie’s development of a next-generation regimen containing ABT-493, the prospects for further clinical development of Enanta’s cyclophilin inhibitor for the treatment of HCV, the prospects for advancing an FXR agonist for the treatment of NASH into clinical trials, the prospects for advancement of another program in HBV or RSV, and the projected sufficiency of Enanta’s cash-equivalent resources and marketable securities. Statements that are not historical facts are based on management’s current expectations, estimates, forecasts and projections about Enanta’s business and the industry in which it operates and management’s beliefs and assumptions. The statements contained in this release are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed in such forward-looking statements. Important factors and risks that may affect
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actual results include: Enanta’s revenues are dependent upon the success of AbbVie’s planned regulatory approval and commercialization efforts for its HCV treatment regimens containing paritaprevir; Enanta’s longer term revenues will be dependent upon the success of AbbVie’s planned clinical development and commercialization of next-generation regimens containing ABT-493; regulatory actions affecting any approval of an HCV treatment regimen containing ABT-493; the pricing, market acceptance and reimbursement rates of treatment regimens containing paritaprevir or ABT-493 compared to competitive HCV products on the market and product candidates of other companies under development; the discovery and development risks of early stage discovery efforts in new disease areas such as HBV, NASH and RSV; potential competition from the development efforts of others in those new disease areas; Enanta’s lack of clinical development experience; Enanta’s need to attract and retain senior management and key scientific personnel; Enanta’s need to obtain and maintain patent protection for its product candidates and avoid potential infringement of the intellectual property rights of others; and other risk factors described or referred to in “Risk Factors” in Enanta’s most recent Form 10-K for the fiscal year ended September 30, 2015 and other periodic reports filed more recently with the Securities and Exchange Commission. Enanta cautions investors not to place undue reliance on the forward-looking statements contained in this release. These statements speak only as of the date of this release, and Enanta undertakes no obligation to update or revise these statements, except as may be required by law.
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ENANTA PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
| Three Months Ended December 31, |
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| 2015 | 2014 | |||||||
| Revenue |
$ | 48,445 | $ | 77,498 | ||||
| Operating expenses |
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| Research and development |
9,033 | 4,519 | ||||||
| General and administrative |
3,818 | 2,769 | ||||||
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| Total operating expenses |
12,851 | 7,288 | ||||||
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| Income from operations |
35,594 | 70,210 | ||||||
| Other income, net |
329 | 301 | ||||||
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| Income before income taxes |
35,923 | 70,511 | ||||||
| Income tax expense |
(9,734 | ) | (28,502 | ) | ||||
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| Net income |
$ | 26,189 | $ | 42,009 | ||||
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| Net income per share |
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| Basic |
$ | 1.39 | $ | 2.26 | ||||
| Diluted |
$ | 1.36 | $ | 2.18 | ||||
| Weighted average common shares outstanding |
||||||||
| Basic |
18,776 | 18,603 | ||||||
| Diluted |
19,269 | 19,283 | ||||||
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ENANTA PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
| December 31, 2015 |
September 30, 2015 |
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| Assets |
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| Current assets |
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| Cash and cash equivalents |
$ | 46,233 | $ | 21,726 | ||||
| Short-term marketable securities |
133,786 | 123,479 | ||||||
| Accounts receivable |
17,869 | 15,289 | ||||||
| Unbilled receivables |
1,009 | 433 | ||||||
| Deferred tax assets |
1,581 | 1,447 | ||||||
| Prepaid expenses and other current assets |
8,543 | 8,267 | ||||||
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| Total current assets |
209,021 | 170,641 | ||||||
| Property and equipment, net |
7,872 | 5,886 | ||||||
| Long-term marketable securities |
56,618 | 64,238 | ||||||
| Deferred tax assets |
4,260 | 4,640 | ||||||
| Restricted cash |
608 | 608 | ||||||
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| Total assets |
$ | 278,379 | $ | 246,013 | ||||
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| Liabilities and Stockholders’ Equity |
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| Current liabilities |
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| Accounts payable |
$ | 2,767 | $ | 1,543 | ||||
| Accrued expenses and other current liabilities |
3,165 | 3,962 | ||||||
| Income taxes payable |
4,940 | 1,199 | ||||||
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| Total current liabilities |
10,872 | 6,704 | ||||||
| Warrant liability |
1,290 | 1,276 | ||||||
| Series 1 nonconvertible preferred stock |
164 | 163 | ||||||
| Other long-term liabilities |
1,774 | 1,713 | ||||||
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| Total liabilities |
14,100 | 9,856 | ||||||
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| Total stockholders’ equity |
264,279 | 236,157 | ||||||
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| Total liabilities and stockholders’ equity |
$ | 278,379 | $ | 246,013 | ||||
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Investor Contact
Carol Miceli
Enanta Pharmaceuticals, Inc.
617-607-0710
cmiceli@enanta.com
Media Contact
Kari Watson
MacDougall Biomedical Communications
781-235-3060
kwatson@macbiocom.com
###
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