CAMBRIDGE, Mass.--(BUSINESS WIRE)--Ra Pharmaceuticals, Inc. (Nasdaq:RARX) today announced financial results for the third quarter ended September 30, 2019, and provided an update on recent corporate and clinical developments.
“With the dosing of the first patient in our pivotal Phase 3 clinical trial of zilucoplan for the treatment of generalized myasthenia gravis (gMG), as well as zilucoplan’s selection as one of the first therapeutic candidates to be evaluated in a pioneering platform trial for amyotrophic lateral sclerosis (ALS) sponsored by the Sean M. Healey & AMG Center for ALS at Mass General, we’ve made significant progress in executing against our strategic plan and expanding zilucoplan’s pipeline of neurologic, tissue-based, complement-mediated diseases,” said Doug Treco, Ph.D., President and Chief Executive Officer of Ra Pharma.
“With UCB’s pending acquisition of Ra, which remains on track to close by the end of the first quarter of 2020, we are incredibly pleased by their recognition of the value we have created. With a shared commitment to the rare disease patient community, UCB represents an ideal partner for furthering our goal of developing and expanding patient access to complement inhibitor therapies.”
Third Quarter 2019 Highlights and Recent Developments
- In October 2019, Ra Pharma announced the entry into a merger agreement pursuant to which UCB has agreed to acquire Ra Pharma. Under the terms of the agreement, Ra Pharma shareholders will receive $48 in cash for each Ra Pharma share at closing (equity value of approximately $2.5 billion). The Boards of Directors of both companies have unanimously approved the transaction, which remains subject to approval by Ra Pharma shareholders and to obtaining antitrust clearance and other customary closing conditions. The transaction is expected to close by the end of the first quarter of 2020.
- In October 2019, Ra Pharma announced the initiation of dosing in a single, pivotal, randomized, double-blind, placebo-controlled Phase 3 trial evaluating zilucoplan for the treatment of gMG, or the RAISE study. The trial, which incorporates feedback from the U.S. Food and Drug Administration (FDA), the European Medicines Agency (EMA), and Japan’s Pharmaceuticals and Medical Devices Agency (PMDA), is designed to evaluate the efficacy of a once-daily, subcutaneously (SC) self-administered dose of 0.3 mg/kg of zilucoplan versus placebo. Top-line results from the RAISE study are expected in early 2021.
- In September 2019, Ra Pharma announced the selection of zilucoplan as one of the first clinical candidates to be evaluated in a pioneering platform trial for ALS. The HEALEY ALS Platform Trial, sponsored by the Sean M. Healey & AMG Center for ALS at Mass General, is designed to support the goal of accelerating the development of effective treatments for patients with ALS.
- In September 2019, the FDA granted Orphan Drug Designation to zilucoplan for the treatment of myasthenia gravis. This designation provides various development incentives, including tax credits for qualified clinical testing, for drugs that treat a rare disease or condition, defined as affecting fewer than 200,000 people in the U.S.
- In August 2019, Ra Pharma announced the receipt of a $3.0 million clinical development milestone payment under its collaboration agreement with Merck & Co. (known as MSD outside the U.S. and Canada). The milestone payment is associated with the dosing of the first patient in a Phase 1 clinical trial evaluating an investigational orally-available macrocyclic peptide for a non-complement cardiovascular target with a large market opportunity from the companies’ collaboration.
- In July 2019, Ra Pharma entered into an exclusive, worldwide license agreement for the use of Camurus AB’s (Nasdaq STO:CAMX; Lund, Sweden) proprietary FluidCrystal® (FC) technology to develop, manufacture, and commercialize a long-acting formulation of zilucoplan. In July 2019, Ra Pharma reported pre-clinical data for the FC extended release (XR) formulation of zilucoplan, in which non-human primates receiving a single dose of the FC XR formulation of zilucoplan rapidly achieved and maintained target levels of complement inhibition for at least seven days without the need for intravenous loading.
- In July 2019, Ra Pharma strengthened its balance sheet with a follow-on offering, raising $149.5 million in gross proceeds.
Third Quarter 2019 Financial Results
For the third quarter of 2019, the Company reported a net loss of $25.0 million, or a net loss of $0.55 per share (basic and diluted), compared to a net loss of $16.5 million, or a net loss of $0.51 per share, for the same period in 2018.
Research and development (R&D) expenses for the third quarter of 2019 were $23.2 million, compared to $13.4 million for the same period in 2018. The increase in R&D expenses for the third quarter of 2019 was primarily due to expenses for non-clinical studies and clinical trials and increased headcount and employee-related costs to support increased research and development activities.
General and administrative (G&A) expenses for the third quarter of 2019 were $6.0 million, compared to $3.5 million for the same period in 2018. The increase in G&A expenses for the third quarter of 2019 was primarily due to increased headcount and employee-related costs and increased expenses related to pre-commercial activities.
In the third quarter of 2019, the Company earned $3.0 million of revenue related to a payment for the achievement of a clinical development milestone under the Company’s collaboration agreement with Merck. There was no revenue earned in the same period in 2018.
As of September 30, 2019, Ra Pharma reported total cash and cash equivalents of $292.6 million. The Company expects that its cash and cash equivalents will be sufficient to fund operating expenses and capital expenditure requirements through at least the end of 2021.
About Zilucoplan
Ra Pharma is developing zilucoplan and zilucoplan extended release (XR) for generalized myasthenia gravis (gMG), immune-mediated necrotizing myopathy (IMNM), amyotrophic lateral sclerosis (ALS), and other tissue-based complement-mediated disorders with high unmet medical need. The product candidate is designed for convenient subcutaneous (SC) self-administration. Zilucoplan is an investigational, synthetic, macrocyclic peptide discovered using Ra Pharma's powerful proprietary drug discovery technology. The peptide is designed to bind complement component 5 (C5) with sub-nanomolar affinity and allosterically inhibit its cleavage into C5a and C5b upon activation of the classical, alternative, or lectin pathways. The U.S. Food and Drug Administration (FDA) has granted Orphan Drug Designation to zilucoplan for the treatment of MG.
About Ra Pharmaceuticals, Inc.
Ra Pharmaceuticals, Inc. is a clinical-stage biopharmaceutical company focused on leading the field of complement biology to bring innovative and accessible therapies to patients with rare diseases. The Company discovers and develops peptides and small molecules to target key components of the complement cascade. For more information, please visit: www.rapharma.com.
Additional Information
A special stockholders meeting will be announced soon to obtain stockholder approval in connection with the proposed merger between Ra Pharma and a wholly owned subsidiary of UCB (the “Merger”). This report may be deemed solicitation material in respect of the proposed Merger. Ra Pharma filed a preliminary proxy statement and other relevant documents in connection with the proposed Merger with the Securities and Exchange Commission (the “SEC”) on November 1, 2019, and expects to file with the SEC a definitive proxy statement and other relevant documents in connection with the proposed Merger at a later date. Investors of Ra Pharma are urged to read the preliminary proxy statement and other relevant materials, and the definitive proxy statement and other relevant materials when they become available, carefully and in their entirety because they contain important information about Ra Pharma, UCB and the proposed Merger. Investors may obtain a free copy of these materials (when they are available) and other documents filed by Ra Pharma with the SEC at the SEC’s website at www.sec.gov, at the Company’s website at www.rapharma.com or by sending a written request to Ra Pharma at 87 Cambridgepark Drive, Cambridge, Massachusetts 02140, Attention: Legal.
Participants in the Solicitation
Ra Pharma and its directors, executive officers and certain other members of management and employees may be deemed to be participants in soliciting proxies from its stockholders in connection with the proposed Merger. Information regarding the persons who may, under the rules of the SEC, be considered to be participants in the solicitation of Ra Pharma’s stockholders in connection with the proposed Merger will be set forth in Ra Pharma’s definitive proxy statement for its special stockholders meeting. Additional information regarding these individuals and any direct or indirect interests they may have in the proposed Merger will be set forth in the definitive proxy statement when and if it is filed with the SEC in connection with the proposed Merger.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding Ra Pharma’s ability to expand patient access to important therapies, the safety, efficacy, regulatory and clinical progress, and therapeutic potential of Ra Pharma’s product candidates, including without limitation zilucoplan and zilucoplan XR, statements regarding trial design, timeline, and enrollment of Ra Pharma’s ongoing and planned clinical programs, including without limitation the Phase 3 trial of zilucoplan for the treatment of gMG, the Phase 2 trial of zilucoplan for the treatment of IMNM and the HEALEY ALS Platform Trial, plans and timing for the presentation of and beliefs regarding clinical trial data, statements regarding the merger with UCB, including the expected timing of closing, and the expectation that Ra Pharma’s cash and cash equivalents will be sufficient to fund operating expenses and capital expenditures through at least the end of 2021. All such forward-looking statements are based on management’s current expectations of future events and are subject to a number of risks and uncertainties that could cause actual results to differ materially and adversely from those set forth in or implied by such forward-looking statements. These risks and uncertainties include the risks that Ra Pharma’s product candidates, including zilucoplan and zilucoplan XR, will not successfully be developed or commercialized, in the timeframe we expect or at all; the risk that Ra Pharma may fail to enroll patients in its clinical trials, which may cause delays or other adverse effects; the risk that Ra Pharma may fail to obtain additional financing on favorable terms or at all; risks relating to the Merger, including: that Ra Pharma may be unable to obtain stockholder approval as required for the Merger; conditions to the closing of the Merger may not be satisfied and required regulatory approvals may be delayed or not be obtained; the Merger may involve unexpected costs, liabilities or delays; the business of Ra Pharma may suffer as a result of uncertainty surrounding the Merger; the outcome of any legal proceedings related to the Merger; Ra Pharma may be adversely affected by other economic, business, and/or competitive factors; the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement; and other risks to the consummation of the Merger, including the risk that the Merger will not be consummated within the expected time period or at all. If the Merger is consummated, Ra Pharma stockholders will cease to have any equity interest in Ra Pharma and will have no right to participate in its earnings and future growth. Additional factors that may affect the future results of Ra Pharma are discussed in the “Risk Factors” section in Ra Pharma’s most recently filed Annual Report on Form 10-K and Quarterly Report on Form 10-Q for the period ending September 30, 2019, as well as other risks detailed in Ra Pharma’s subsequent filings with the Securities and Exchange Commission. There can be no assurance that the actual results or developments anticipated by Ra Pharma will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, Ra Pharma. All information in this press release is as of the date of the release, and Ra Pharma undertakes no duty to update this information unless required by law.
| Ra Pharmaceuticals, Inc. | ||||||||
| Condensed Consolidated Statements of Operations | ||||||||
| (Unaudited) | ||||||||
| (in thousands, except per share data) | ||||||||
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||
2019 |
2018 |
2019 |
2018 |
|||||
| Revenue | $ 3,000 |
$ - |
$ 3,000 |
$ - |
||||
| Operating expenses: | ||||||||
| Research and development | (23,244) |
(13,375) |
(56,439) |
(39,092) |
||||
| General and administrative | (5,972) |
(3,504) |
(15,712) |
(10,637) |
||||
| Total operating expenses | (29,216) |
(16,879) |
(72,151) |
(49,729) |
||||
| Loss from operations | (26,216) |
(16,879) |
(69,151) |
(49,729) |
||||
| Other income (expense), net | 1,241 |
375 |
3,240 |
981 |
||||
| Benefit from income taxes | - |
- |
- |
- |
||||
| Net loss | $ (24,975) |
$ (16,504) |
$ (65,911) |
$ (48,748) |
||||
| Net loss per common share – basic and diluted | $ (0.55) |
$ (0.51) |
$ (1.52) |
$ (1.60) |
||||
| Weighted average number of common shares outstanding – basic and diluted | 45,766 |
32,349 |
43,418 |
30,652 |
||||
| Ra Pharmaceuticals, Inc. | ||||
| Condensed Consolidated Balance Sheets | ||||
| (Unaudited) | ||||
| (In thousands) | ||||
| September 30, 2019 |
December 31, 2018 |
|||
| Assets | ||||
| Cash and cash equivalents | $ 292,602 |
$ 209,822 |
||
| Prepaid expenses and other current assets | 7,578 |
2,585 |
||
| Property and equipment, net | 4,524 |
5,165 |
||
| Operating Lease right-of-use assets, net | 2,600 |
- |
||
| Other noncurrent assets | 1,634 |
1,648 |
||
| Total assets | $ 308,938 |
$ 219,220 |
||
| Liabilities and Stockholders’ Equity | ||||
| Accounts payable and accrued expenses | $ 10,679 |
$ 9,722 |
||
| Operating lease liabilities | 987 |
- |
||
| Deferred rent | - |
479 |
||
| Noncurrent liabilities | 3,515 |
1,901 |
||
| Stockholders' equity | 293,757 |
207,118 |
||
| Total liabilities and stockholders’ equity | $ 308,938 |
$ 219,220 |
||
