On March 7, 2019 ArQule, Inc. (Nasdaq: ARQL) reported its financial results for the fourth quarter and full year of 2018 (Press release, ArQule, MAR 7, 2019, View Source [SID1234534077]).
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For the quarter ended December 31, 2018, the Company reported a net loss of $8,487,000 or $0.08 per share, compared with net loss of $7,760,000 or $0.09 per share, for the quarter ended December 31, 2017. The Company reported a net loss of $15,482,000 or $0.16 per share, for the year ended December 31, 2018, compared with a net loss of $29,203,000 or $0.39 per share, for the year ended December 31, 2017.
As of December 31, 2018, the Company had a total of approximately $99,558,000 in cash, equivalents, and marketable securities.
Key Highlights from 2018
ARQ 531, our potent and reversible dual inhibitor of both wild-type and C481S-mutant BTK. Successfully progressedrecruitment in our ongoing phase 1 dose escalation trial in 2018, enrolling over 20 patients at 7 dose cohorts ranging from 5mg to 65mg QD. Data from this trial was presented at 3 major conferences (AACR, EHA (Free EHA Whitepaper), ASH (Free ASH Whitepaper)) in 2018 and demonstrated a good safety profile, profound target engagement and encouraging signs of dose-dependent clinical activity in both lymphomas and C481S-mutant CLL
Miransertib, our potent and selective first-generation AKT inhibitor. Presented first-of-its kind clinical data in Proteus syndrome and PROS at the American Society of Human Genetics (ASHG), received FDA Fast Track Designation in PROS, and worked with regulators to define registrational trial designs for both indications
ARQ 751, our highly potent and selective next-generation AKT inhibitor. Progressed the phase 1 basket trial in R/R or metastatic cancer patients harboring an AKT, PI3K or PTEN mutation, identified a recommended phase 2 dose of 75mg QD and presented data at the EORTC/AACR/NCI congress in November
Derazantinib, our FGFR inhibitor, partnered with Basilea and Sinovant, in a registrational trial for intrahepatic cholangiocarcinoma. Continued the timely recruitment and transfer of clinical and other responsibilities to Sinovant and Basilea following the outlicensing to both companies in February and April of last year, respectively
Capital Structure. Strengthened our capital structure through business development activities, which included funding from our collaborators and a successful offering of our common stock which raised gross proceeds of about $70 million
Stock Index Inclusions. Added to the family of Russell 2000 Index companies in June and the NASDAQ Biotechnology Index in December
Key Catalysts & Goals for 2019
ARQ 531: Dual BTK Inhibitor in B-Cell Malignancies
Complete the dose escalation portion of phase 1 trial
Determine a recommended phase 2 dose and initiate expansion cohort(s)
Present results of dose escalation phase 1 trial at major industry conference(s)
Miransertib: AKT Inhibitor in Proteus syndrome and PROS
Finalize regulatory interactions with the FDA
Initiate registrational trial cohorts in both Proteus syndrome and PROS
ARQ 751 (and Miransertib): AKT Inhibitors in Oncology
Complete recruitment in ongoing clinical trials
Present data sets at major medical conferences this year
Derazantinib: FGFR Inhibitor in iCCA
Complete the orderly and timely transfer of all clinical, manufacturing and regulatory responsibilities to our partners, Basilea and Sinovant
"2018 was a watershed year for ArQule," remarked Paolo Pucci, Chief Executive Officer. "The clinical progress we made across the entire portfolio positions us well for an even more transformational 2019. Specifically in rare disease, we now have the ability to expand the scope of the miransertib registrational trial beyond Proteus syndrome to the PROS family of overgrowth spectrum disorders which represents a particularly exciting opportunity because of their significantly larger prevalence."
Dr. Brian Schwartz, Chief Medical Officer, added "We made tremendous progress in 2018, enrolling over 20 patients across 7 cohorts in our dose escalation study with ARQ 531 which is now positioned as the first and best in class drug candidate to address the emerging medical need in BTK mutated malignancies. We are looking forward to advance ARQ 531, miransertib and ARQ 751 respectively into the next phase of development. I want to thank our collaborators such as the Ohio State University, the National Institute of Health and Bambino Gesu’, and others for their continued support in advancing these programs."
Revenues and Expenses
Revenues for the quarter ended December 31, 2018, were $2,941,000 compared with revenues of zero for the quarter ended December 31, 2017. Revenues for the year ended December 31, 2018 were $25,764,000 compared with revenues of zero for the year ended December 31, 2017. Research and development revenue increased in 2018 due to revenue of $5.9 million from our February 2018 Sinovant licensing agreement, $18.5 million from our April 2018 Basilea licensing agreement and $1.3 million from a non-exclusive license agreement for certain of our library compounds.
Research and development expenses in the fourth quarter of 2018 were $8,850,000 compared with $4,721,000 for the fourth quarter 2017. Fiscal 2018 research and development expenses were $28,710,000 compared with $19,468,000 for fiscal 2017. The $4.1 million increase in research and development expense in the fourth quarter of 2018 compared with the fourth quarter of 2017 was primarily due to higher outsourced preclinical, clinical and product development costs of $3.5 million and $0.6 million from labor and related costs.
The $9.2 million increase in research and development expense in 2018 was primarily due to higher outsourced preclinical, clinical and product development costs of $8.5 million and $0.7 million from labor and related costs.
General and administrative expenses in the fourth quarter of 2018 were $2,739,000, compared with $1,849,000 for the fourth quarter of 2017. General and administrative expenses for fiscal 2018 were $10,753,000, compared to $7,551,000 for fiscal 2017. The $0.9 million increase in general and administrative expense in the fourth quarter of 2018 compared with the fourth quarter of 2017 was principally due to higher consulting and professional fees of $0.4 million and labor and related costs of $0.5 million. The $3.2 million increase in general and administrative expense in 2018 was principally due to higher consulting and professional fees of $2.1 million and labor and related costs of $1.1 million.
2019 Financial Guidance
For 2019, ArQule expects revenue to range between $3 and $5 million. Net loss is expected to range between $40 and $43 million, and net loss per share to range between $(0.37) and $(0.39) for the year. ArQule expects to end 2019 with between $60 and $63 million in cash and marketable securities.
Conference Call and Webcast
ArQule will hold its fourth quarter and full year financial results call today, March 7, 2019 at 9:00 a.m. ET. The live webcast can be accessed in the "Investors and Media" section of our website, www.arqule.com, under "Events and Presentations." You may also listen to the call by dialing (877) 868-1831 within the U.S. or (914) 495-8595 outside the U.S. A replay will be available two hours after the completion of the call and can be accessed in the "Investors and Media" section of our website, www.arqule.com, under "Events and Presentations."