MONMOUTH JUNCTION, N.J.,
March 13, 2012 /PRNewswire/ -- Insmed
Incorporated (Nasdaq CM: INSM), a biopharmaceutical company, today
reported results for the fourth quarter and fiscal year ended
December 31, 2011.
Key Recent Highlights:
- Clinical hold lifted by U.S. Food and Drug Administration (FDA)
for ARIKACE® (liposomal amikacin for inhalation) in patients with
non-tuberculous mycobacterial (NTM) lung disease
- Insmed proceeding with four key ARIKACE studies:
- Phase 2 clinical trial in NTM patients
- Pivotal phase 3 clinical study in Europe in Cystic Fibrosis (CF) patients with
Pseudomonas lung infections
- Follow-on multi-cycle open-label study primarily to measure
safety and tolerability for patients who complete the European
pivotal phase 3 CF study
- 9-month dog inhalation toxicity study
- Company submits complete response to FDA requests regarding CF
clinical hold
"We have recently made significant progress with our ARIKACE
program," said Timothy Whitten,
President and CEO of Insmed. "In January of this year, FDA
lifted the clinical hold on ARIKACE in patients with NTM lung
infections and we plan to initiate enrolment in the phase 2
clinical trial for ARIKACE in NTM patients in mid-2012. In
addition, we expect to begin enrolment in the European pivotal
phase 3 clinical study of ARIKACE in CF patients in the second
quarter of this year. Insmed is also on track to initiate the
nine-month dog inhalation toxicity study during the second quarter
of this year."
"Additionally, we have submitted our complete response to FDA's
requests with regard to the CF clinical hold," noted Mr. Whitten.
"We continue to believe that ARIKACE has the potential to be
an important treatment option for patients who have NTM lung
infections and CF patients who have Pseudomonas lung
infections, as well as an opportunity to create significant
long-term value for our shareholders."
Financial Results:
For the fourth quarter of 2011, Insmed posted a net loss
attributable to common stockholders of $8.2
million, or $0.33 per share –
basic and diluted, compared to a net loss of $5.8 million, or $0.42 per share – basic and diluted, for the
three months ended December 31, 2010.
The fourth quarter of 2011 net loss includes a $1.2 million non-cash charge related to the lease
write-down following the closure of the Richmond, Virginia office due to the cessation
of IPLEX® activities in December
2011.
Net loss attributable to common stockholders for the year ended
December 31, 2011 was $68.8 million, which includes the $1.2 million non-cash charge from the
Richmond office closure and a
$26.0 million non-cash charge
resulting from an impairment adjustment in the third quarter, or
$2.95 per common share – basic and
diluted, compared to a net loss of $6.4
million, or $0.49 per common
share – basic and diluted, for the year ended December 31, 2010. The impairment charge in
the third quarter of 2011 was due to the material impact of the FDA
clinical hold on our ARIKACE development program. The net loss
attributable to common stockholders in 2011 also includes the
conversion of the Series B Preferred Stock, and a non-cash
charge for the beneficial conversion feature of the Series B
Preferred Stock in the amount of $9.2
million, which increased the net loss and, in turn, reduced
earnings of Insmed per common share on a basic and diluted basis by
$0.40. The charge represents
the $1.00 difference between the
conversion price of the Series B Preferred Stock of $7.10 per share and its carrying value of
$6.10 per share. The carrying
value of the Series B Preferred Stock was based on its fair value
at issuance, which was estimated using the common stock price
reduced for a lack of marketability between the issuance date and
the anticipated date of conversion.
Revenues for the three-months ended December 31, 2011 were $1.4 million, as compared to $1.3 million for the quarter ended December 31, 2010. The $0.1 million increase in revenue was primarily
attributable to the receipt of $0.8
million from the licensing of patent technology related to
Insmed's CISPLATIN Lipid Complex, which was partially offset by a
year-over-year decrease of $0.7
million in cost recovery from Insmed's IPLEX Expanded Access
Program (EAP) in Europe, which
ended in early December 2011.
Revenues for the year ended December 31,
2011 totalled $4.4 million, as
compared to $6.9 million for the year
ended December 31, 2010. The
$2.5 million decrease was also
primarily due to a year-over-year decrease of $3.5 million in cost recovery from the IPLEX EAP
in Europe, partially offset by
$1.0 million in license fees received
in 2011 for the licensing of patent technology related to Insmed's
CISPLATIN Lipid Complex.
Research and development (R&D) expenses were $6.5 million for the fourth quarter of 2011,
compared to $2.5 million in the
fourth quarter of 2010. The increase of $4.0 million is attributable to the clinical and
manufacturing R&D activities for ARIKACE in the CF and NTM
indications. General and administrative (G&A) expenses
were $3.8 million for the fourth
quarter of 2011, compared to $5.2
million for the same period in 2010. The $1.4 million decrease was primarily attributable
to the non-recurring external finance, legal and consulting
expenses related to the business combination in the fourth quarter
of 2010, which were partially offset by the Richmond office closure costs and increased
headcount expenses in the current quarter.
R&D expenses increased to $27.9 million in the year ended December 31, 2011 from $4.8 million for the year ended December 31, 2010. The increase of
$23.1 million in 2011 is also
attributable to clinical research and development of the ARIKACE
program and the manufacturing of supply to support the studies in
2011. Of note within the R&D expenses, clinical
development and regulatory expenses increased $15.4 million in 2011 compared to 2010 as a
result of the planning efforts for the ARIKACE studies. There
was also a $4.5 million increase in
clinical manufacturing expenses from 2011 to 2010 attributable to
the manufacturing of ARIKACE for use in these studies while
compensation expenses rose $3.2
million due to an increased headcount of 17 year on year to
28. G&A expenses increased to $12.2 million in the year ended December 31, 2011 from $10.3 million for the year ended
December 31, 2010. The
$1.9 million increase was due largely
to the Richmond office closure
costs and headcount increases associated with the administrative
support for the development of ARIKACE, which were partially offset
by the non-recurring business combination costs which were incurred
in 2010.
As of December 31, 2011, Insmed
had total cash, cash equivalents, short-term investments, and
certificate of deposits on hand totaling $78.4 million, consisting of $76.3 million in cash and short-term investments
and $2.1 million in a certificate of
deposit, as compared to $110.2
million of cash on hand as of December 31, 2010. The $31.8 million decrease in total cash was
primarily due to the net cash used in operating activities of
$30.2 million during the 2011 fiscal
year.
Conference Call
To participate in today's live conference call at 8:30 AM ET, please dial 800-798-2864 (U.S.
callers) or 617-614-6206 (international), and provide passcode
48373405. A live webcast of the call will also be available
at: http://www.media-server.com/m/p/xfhdp2ne. Please allow extra
time prior to the webcast to register, download and install any
necessary audio software. The webcast will be archived for 30
days, and a telephone replay of the call will be available for
seven days, beginning at 10:30 AM ET
on March 13th, at 888-286-8010 (U.S.
callers) or 617-801-6888 (international), using passcode
11615475.
About Insmed
Insmed Incorporated is a biopharmaceutical company focused on
the development of innovative inhaled pharmaceuticals for the
site-specific treatment of serious lung diseases. Insmed's
primary focus is on the development of inhaled antibiotic therapy
delivered via proprietary advanced liposomal pulmonary technology
in areas of high unmet need. For more information, please
visit http://www.insmed.com.
Forward-Looking Statements
This release contains forward-looking statements which are made
pursuant to provisions of Section 21E of the Securities Exchange
Act of 1934. Investors are cautioned that such statements in this
release, including statements relating to our financial position,
results of operations, the status and the results of preclinical
studies and clinical trials and preclinical and clinical data
described herein, the timing of and costs associated with
pre-clinical studies and clinical trials, the development of our
products, and the business strategies, plans and objectives of
management, constitute forward-looking statements which involve
risks and uncertainties that could cause actual results to differ
materially from those anticipated by the forward-looking
statements. Our results may be affected by such factors as
the receipt and timing of FDA and other regulatory reviews and
approvals, if at all, competitive developments affecting our
product development, delays in product development or clinical
trials, and patent disputes involving currently developing
products. The risks and uncertainties include, without
limitation, we may experience unexpected regulatory actions, delays
or requests, our future clinical trials may not be successful, we
may be unsuccessful in developing our product candidates or
receiving necessary regulatory approvals, we may experience delays
in our product development or clinical trials, our product
candidates may not prove to be commercially successful, our
expenses may be higher than anticipated and other risks and
challenges detailed in our filings with the U.S. Securities and
Exchange Commission, including our Annual Report on Form 10-K for
the year ended December 31,
2011. Investors are cautioned not to place undue reliance on
any forward-looking statements which speak only as of the date of
this release. We undertake no obligation to publicly release
the results of any revisions to these forward-looking statements
that may be made to reflect events or circumstances that occur
after the date of this release or to reflect the occurrence of
unanticipated events.
Investor Relations Contact:
Brian Ritchie – FTI
Consulting
212-850-5683
brian.ritchie@fticonsulting.com
Media Contact:
Irma Gomez-Dib – FTI Consulting
212-850-5761
irma.gomez-dib@fticonsulting.com
|
|
INSMED
INCORPORATED
|
|
Consolidated
Balance Sheets
|
|
(in
thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2011
|
|
2010
|
|
Assets
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
14,848
|
|
$
10,743
|
|
Short-term
investments
|
|
61,424
|
|
97,306
|
|
Accounts
receivable
|
|
757
|
|
471
|
|
Prepaid expenses and other
current assets
|
|
370
|
|
277
|
|
Total current
assets
|
|
77,399
|
|
108,797
|
|
|
|
|
|
|
|
Certificate of
deposit
|
|
2,085
|
|
2,176
|
|
In-process research and
development
|
|
58,200
|
|
77,900
|
|
Goodwill
|
|
-
|
|
6,290
|
|
Deposits
|
|
212
|
|
-
|
|
Fixed assets, net
|
|
1,937
|
|
1,102
|
|
Total assets
|
|
$
139,833
|
|
$
196,265
|
|
|
|
|
|
|
|
Liabilities and stockholders'
equity
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts
payable
|
|
$
2,334
|
|
$
1,450
|
|
Accrued
expenses
|
|
800
|
|
139
|
|
Accrued
compensation
|
|
795
|
|
1,117
|
|
Accrued lease expense,
current
|
|
278
|
|
|
|
Deferred rent
|
|
156
|
|
150
|
|
Capital lease obligations,
current
|
|
114
|
|
81
|
|
Deferred
revenue
|
|
-
|
|
402
|
|
Total current
liabilities
|
|
4,477
|
|
3,339
|
|
|
|
|
|
|
|
Accrued lease expense, long
term
|
|
923
|
|
|
|
Capital lease obligations,
long-term
|
|
166
|
|
83
|
|
Total
liabilities
|
|
5,566
|
|
3,422
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
Common stock; $.01 par value;
authorized shares
|
|
|
|
|
|
500,000,000; issued and
outstanding shares, 24,833,301 in 2011 and 15,653,734 in
2010
|
|
248
|
|
1,565
|
|
Preferred stock; $.01 par value;
authorized shares
|
|
|
|
|
|
200,000,000; issued and
outstanding shares, zero in 2011 and 9,174,589 in 2010
|
|
-
|
|
918
|
|
Additional paid-in
capital
|
|
427,743
|
|
423,877
|
|
Accumulated
deficit
|
|
(294,174)
|
|
(234,510)
|
|
Accumulated other
comprehensive income:
|
|
|
|
|
|
Unrealized gain on
investments
|
|
450
|
|
993
|
|
Total stockholders'
equity
|
|
134,267
|
|
192,843
|
|
Total liabilities and
stockholders' equity
|
|
$
139,833
|
|
$
196,265
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Statements of Operations
|
|
(in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
Years Ended
December 31,
|
|
|
|
2011
|
|
2010
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
License fees
|
$ 1,002
|
|
$
4
|
|
129
|
|
|
Grant revenue
|
-
|
|
-
|
|
1,044
|
|
|
Other expanded access program
income, net
|
3,415
|
|
6,917
|
|
9,200
|
|
|
Total revenues
|
4,417
|
|
6,921
|
|
10,373
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
Research and
development
|
27,917
|
|
4,757
|
|
9,207
|
|
|
General and
administrative
|
12,229
|
|
10,256
|
|
9,840
|
|
|
Impairment loss
|
25,990
|
|
-
|
|
-
|
|
|
Total operating
expenses
|
66,136
|
|
15,013
|
|
19,047
|
|
|
|
|
|
|
|
|
|
|
Operating loss
|
(61,719)
|
|
(8,092)
|
|
(8,674)
|
|
|
|
|
|
|
|
|
|
|
Investment income
|
2,064
|
|
1,845
|
|
808
|
|
|
Interest expense
|
(10)
|
|
(109)
|
|
(781)
|
|
|
Gain on sale of asset,
net
|
1
|
|
-
|
|
127,474
|
|
|
(Loss) income before
income taxes
|
(59,664)
|
|
(6,356)
|
|
118,827
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
-
|
|
78
|
|
477
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
|
(59,664)
|
|
(6,434)
|
|
118,350
|
|
|
|
|
|
|
|
|
|
|
Less: accretion of beneficial
conversion charge
|
(9,175)
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
attributable to common stockholders
|
$ (68,839)
|
|
$
(6,434)
|
|
$ 118,350
|
|
|
|
|
|
|
|
|
|
|
Basic net (loss) income
attributable to common stockholders per common share
|
$
(2.95)
|
|
$
(0.49)
|
|
$
9.31
|
|
|
|
|
|
|
|
|
|
|
Weighted average basic common
shares outstanding
|
23,348
|
|
13,250
|
|
12,712
|
|
|
|
|
|
|
|
|
|
|
Diluted net (loss) income
attributable to common stockholders per common share
|
$
(2.95)
|
|
$
(0.49)
|
|
$
9.30
|
|
|
|
|
|
|
|
|
|
|
Weighted average diluted
common shares outstanding
|
23,348
|
|
13,250
|
|
12,727
|
|
|
|
|
|
|
|
|
|
|
|
INSMED
INCORPORATED
|
|
Consolidated
Statements of Cash Flows
|
|
(in
thousands)
|
|
|
|
|
|
|
|
|
Years Ended
December 31,
|
|
|
|
2011
|
|
2010
|
|
2009
|
|
Operating
activities
|
|
|
|
|
|
|
Net (loss) income
|
$ (59,664)
|
|
$ (6,434)
|
|
$ 118,350
|
|
Adjustments to reconcile net
(loss) income to net cash (used in)
|
|
|
|
|
|
|
provided by operating
activities:
|
|
|
|
|
|
|
Depreciation and
amortization
|
343
|
|
54
|
|
707
|
|
Stock based compensation
expense
|
1,599
|
|
366
|
|
2,542
|
|
Gain on sale of asset,
net
|
(1)
|
|
-
|
|
(127,474)
|
|
Impairment Loss
|
25,990
|
|
-
|
|
-
|
|
Changes in
operating assets and liabilities:
|
|
|
|
|
|
|
Accounts
receivable
|
(286)
|
|
19
|
|
(123)
|
|
Income tax
receivable
|
-
|
|
2,023
|
|
(2,023)
|
|
Prepaid expenses and other
assets
|
(214)
|
|
(78)
|
|
-
|
|
Accounts
payable
|
884
|
|
(2,750)
|
|
(85)
|
|
Accrued
expenses
|
667
|
|
(1,126)
|
|
(874)
|
|
Accrued lease
expenses
|
1,201
|
|
-
|
|
-
|
|
Accrued
compensation
|
(322)
|
|
201
|
|
214
|
|
Income tax
liabilities
|
|
|
-
|
|
-
|
|
Deferred rent
|
|
|
-
|
|
-
|
|
Deferred
revenue
|
(402)
|
|
4
|
|
96
|
|
Restricted stock unit
liability
|
-
|
|
-
|
|
(113)
|
|
Asset retirement
obligation
|
-
|
|
-
|
|
(2,217)
|
|
Interest payable
|
-
|
|
(1)
|
|
(12)
|
|
Net cash (used in) provided by
operating activities
|
(30,205)
|
|
(7,722)
|
|
(11,012)
|
|
|
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
|
Cash
consideration for merger, net of cash acquired
|
-
|
|
(6,733)
|
|
-
|
|
Cash
received from asset sale
|
-
|
|
-
|
|
127,474
|
|
Purchase of
fixed assets
|
(979)
|
|
-
|
|
-
|
|
Sales of
short-term investments
|
36,500
|
|
115,153
|
|
-
|
|
Purchases of
short-term investments
|
(1,161)
|
|
(102,462)
|
|
(108,744)
|
|
Net cash provided by (used in)
investing activities
|
34,360
|
|
5,958
|
|
18,730
|
|
|
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
|
Payments on capital lease
obligations
|
(82)
|
|
(6)
|
|
-
|
|
Repayment of convertible
notes
|
-
|
|
(231)
|
|
(1,246)
|
|
Proceeds from issuance of common
stock
|
32
|
|
-
|
|
580
|
|
Warrants converted into
shares
|
-
|
|
-
|
|
3,491
|
|
Other
|
-
|
|
4
|
|
52
|
|
Net cash (used in) provided by
financing activities
|
(50)
|
|
(233)
|
|
2,877
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in cash and
cash equivalents
|
4,105
|
|
(1,997)
|
|
10,595
|
|
Cash and cash equivalents at
beginning of period
|
10,743
|
|
12,740
|
|
2,145
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end
of period
|
$ 14,848
|
|
$ 10,743
|
|
$ 12,740
|
|
|
|
|
|
|
|
|
|
Supplemental disclosures of cash
flow information
|
|
|
|
|
|
|
Cash paid for
interest
|
$
10
|
|
$
-
|
|
$
82
|
|
Cash paid (received) for taxes,
net
|
$
-
|
|
$ (1,884)
|
|
$ 2,795
|
|
|
|
|
|
|
|
|
|
Supplemental disclosures of
non-cash investing and financing activities
|
|
|
|
|
|
Purchase of capital
leases
|
$
198
|
|
$
-
|
|
$
-
|
|
|
Unrealized (loss) gain on
investments
|
$
(543)
|
|
$
548
|
|
$
445
|
|
|
Accretion of beneficial
conversion charge
|
$ (9,175)
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
|
SOURCE Insmed Incorporated