On November 13, 2019 Brickell Biotech, Inc. ("Brickell") (Nasdaq: BBI), a clinical-stage pharmaceutical company focused on developing innovative and differentiated prescription therapeutics for the treatment of debilitating skin diseases, reported financial results for the third quarter ended September 30, 2019 and provided a corporate update (Press release, Vical, NOV 13, 2019, View Source [SID1234551140]).
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"Becoming a publicly listed company earlier this year was a transformative milestone for Brickell and we remain confident about the potential of our lead asset, sofpironium bromide, for primary axillary hyperhidrosis," commented Robert Brown, Chief Executive Officer of Brickell. "Ten million people in the United States suffer from this disease which can have a negative impact on a patient’s social life, well-being, emotional and mental health."
Business and Recent Developments
In September 2019, Brickell announced completion of its merger with Vical Incorporated ("Vical"), following approval by Vical’s shareholders, and commenced trading on The Nasdaq Capital Market under the ticker symbol "BBI". Vical contributed approximately $35 million to the combined company in addition to an R&D financing arrangement entered into with NovaQuest Capital Management that provides up to $25 million in funding.
The long-term safety study for sofpironium bromide is fully enrolled with 300 subjects and is on track to be completed in the first quarter of 2020. Earlier this year, Brickell’s development partner, Kaken Pharmaceutical Co. Ltd. ("Kaken"), achieved positive pivotal Phase 3 results in its clinical study conducted in Japan. To date there have been 19 clinical studies conducted by Brickell and Kaken of sofpironium bromide gel that encompass over 1,200 subjects.
On October 23, 2019, Bodor Laboratories, Inc. and Nicholas S. Bodor (collectively, "Bodor") filed a complaint against Brickell disputing certain aspects of the license agreement between the parties with respect to sofpironium bromide ("Complaint"). As a result, NovaQuest notified the Company that additional development funding for sofpironium bromide was suspended temporarily. Subsequently, Brickell filed a motion to dismiss the Complaint, initiated arbitration proceedings against Bodor and asserted claims against Bodor for tortious interference and material breach of the license agreement by Bodor.
The sofpironium bromide pivotal Phase 3 studies in axillary hyperhidrosis are ready to commence in the United States, pending developments in the ongoing dispute resolution process with Bodor.
Financial Results
Cash, cash equivalents, and short-term investments were $25.7 million as of September 30, 2019 compared to $8.1 million as of September 30, 2018.
Revenue was $1.2 million for the third quarter of 2019 compared to $3.0 million for the third quarter of 2018. The decrease is due primarily to the completion of certain research and development activities during the three months ended September 30, 2019 for which funding is provided under a license and collaboration agreement with Kaken.
Research and development expenses were $3.3 million for the third quarter of 2019 compared to $4.1 million for the third quarter of 2018. The decrease in research and development expenses is primarily due to a decrease in clinical studies costs associated with sofpironium bromide following the completion of certain clinical trials.
General and administrative expenses were $3.9 million for the third quarter of 2019 compared to $1.2 million for the third quarter of 2018. The increase in general and administrative expenses is primarily due to an increase in professional fees for legal, accounting, and auditing services, including merger-related costs.
The Company’s net loss was $4.8 million for the third quarter of 2019, and $13.0 million for the nine months ended September 30, 2019, compared to $2.5 million for the third quarter of 2018, and $5.6 million for the nine months ended September 30, 2018.
About Sofpironium Bromide
Sofpironium bromide, is a proprietary new molecular entity that belongs to a class of medications called anticholinergics. Anticholinergics block the action of acetylcholine, a chemical that transmits signals within the nervous system that are responsible for a range of bodily functions, including activation of the sweat glands. Sofpironium bromide was retrometabolically designed. Retrometabolic drugs are designed to exert their action topically and are potentially rapidly metabolized once absorbed into the blood. This proposed mechanism of action may allow for highly effective doses to be used while limiting systemic side effects.
About Hyperhidrosis
Hyperhidrosis is a life-altering medical condition where a person sweats more than the body requires to regulate its temperature. More than 15 million people, or 4.8% of the population of the United States, are believed to suffer from hyperhidrosis. Axillary (underarm) hyperhidrosis is the targeted first indication for sofpironium bromide and is the most common occurrence of hyperhidrosis, affecting an estimated 65% of patients in the United States or 10 million individuals. Doolittle et al. Arch Dermatol Res (2016).