On August 10, 2020 AcelRx Pharmaceuticals, Inc. (Nasdaq: ACRX), (AcelRx), a specialty pharmaceutical company focused on the development and commercialization of innovative therapies for use in medically supervised settings, reported its second quarter 2020 financial results (Press release, AcelRx Pharmaceuticals, AUG 10, 2020, View Source [SID1234563372]).
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"Despite the challenges with COVID in the second quarter, we made meaningful progress towards generating long-term shareholder value and expanding the DSUVIA launch through advancements with the Department of Defense and our exclusive agreement with Zimmer Biomet for dental surgeries," said Vince Angotti, Chief Executive Officer of AcelRx. "We expect these two revenue streams, both of which require minimal AcelRx commercial investment, to be the main drivers of our near-term revenue growth. Hospital and ambulatory surgery centers remain the core focus of our commercial team, and we expect recent hospital system wins to positively impact revenues in the mid to long term. We continue to execute on our strategy while focusing on prudent cash management."
Second Quarter and Recent Highlights
DSUVIA achieved Milestone C approval from the Department of Defense, a decision that approves DSUVIA for use in all U.S. Army sets, kits and outfits (SKOs). AcelRx expects that initial stocking orders beginning later this year for U.S. Army SKOs alone will approximate $30 million over the next three years, dependent on troop deployment schedules.
The DoD issued a Notice of Intent, converting to a Request for Proposal (RFP), for the purchase of up to 12,200 boxes or 122,000 DSUVIA units, expected to be ordered in the third quarter of 2020, which is separate from expected purchases for SKOs.
In July, AcelRx entered into a distribution agreement with Zimmer Biomet to market DSUVIA (sufentanil sublingual tablet), 30 mcg, within the dental and oral surgery markets in the United States exclusively through Zimmer Biomet’s Dental division, expanding U.S. availability of DSUVIA. It is estimated that the applicable market in dental surgeries is over 7 million annual procedures.
In July, AcelRx completed a $10 million common stock offering priced at the market with two leading life science investors.
Financial Information
As previously announced:
Cash, cash equivalents and short-term investments balance of $43.7 million as of June 30, 2020;
Second quarter 2020 net revenues were $2.9 million, of which approximately $2.6 million relates to the recognition of revenue related to the Company’s Zalviso agreement with Grünenthal that was previously deferred;
Combined R&D and SG&A expenses for the second quarter of 2020 totaled $8.4 million compared to $12.5 million for the second quarter of 2019. Excluding stock-based compensation expense, these amounts were $7.3 million for the second quarter of 2020 compared to $11.2 million for the second quarter of 2019. R&D and SG&A expenses for the first half of 2020 totaled $23.1 million compared to $23.8 million in the first half of 2019. Excluding stock-based compensation expense, these figures were $20.9 million for the first half of 2020 compared to $21.5 million for the first half of 2019. The decrease in combined R&D and SG&A expenses in the second quarter of 2020 was primarily due to a reduction of $1.9 million in DSUVIA-related commercialization expenses, a $1.7 million reduction in personnel costs, and a net benefit of $0.5 million from the receipt of a breakup fee from Tetraphase, net of expenses incurred related to the transaction in the quarter. See the "Reconciliation of Non-GAAP Financial Measures" table below for a reconciliation of the non-GAAP operating expenses described above to their related GAAP measures.
For the second quarter of 2020, net loss was $6.6 million, or $0.08 per basic and diluted share, compared to $12.4 million, or $0.16 per basic and diluted share, for the second quarter of 2019. Net loss for the first half of 2020 was $22.5 million, or $0.28 basic and diluted net loss per share, compared to $26.1 million, or $0.33 basic and diluted net loss per share, for the prior year period.
Webcast and Conference Call Information
As previously announced, AcelRx will host a live webcast Monday, August 10, 2020 at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) to discuss these financial results and provide other corporate updates. The webcast is accessible by visiting the Investors page of AcelRx’s website at www.acelrx.com and clicking on the webcast link. The webcast will be accompanied by a slide presentation. Investors who wish to participate in the conference call may do so by dialing (866) 361-2335 for domestic callers, (855) 669-9657 for Canadian callers or (412) 902-4204 for international callers. A webcast replay will be available on the AcelRx website for 90 days following the call by visiting the Investor page of AcelRx’s website at www.acelrx.com.
About DSUVIA (sufentanil sublingual tablet), 30 mcg
DSUVIA, known as DZUVEO in Europe, approved by the FDA in November 2018, is indicated for use in adults in certified medically supervised healthcare settings, such as hospitals, surgical centers, and emergency departments, for the management of acute pain severe enough to require an opioid analgesic, and for which alternative treatments are inadequate. DSUVIA was designed to provide rapid analgesia via a non-invasive route and to eliminate dosing errors associated with intravenous (IV) administration. DSUVIA is a single-strength solid dosage form administered sublingually via a single-dose applicator (SDA) by healthcare professionals. Sufentanil is an opioid analgesic previously only marketed for IV and epidural anesthesia and analgesia. The sufentanil pharmacokinetic profile when delivered sublingually avoids the high peak plasma levels and short duration of action observed with IV administration. The European Commission approved DZUVEO for marketing in Europe in June 2018 and AcelRx is currently in discussions with potential European marketing partners.
This release is intended for investors only. For more information, including important safety information and black box warning for DSUVIA, please visit www.DSUVIA.com.