On August 8, 2019 Akebia Therapeutics, Inc. (Nasdaq: AKBA), a biopharmaceutical company focused on the development and commercialization of therapeutics for people living with kidney disease, reported financial results for the second quarter ended June 30, 2019 (Press release, Akebia, AUG 8, 2019, View Source [SID1234538410]). The Company will host a conference call today, Thursday, August 8, 2019, at 9:00 a.m. Eastern Time to discuss its second quarter 2019 financial results and recent business highlights.

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"Akebia continues to make great progress advancing our strategy. Fueled by strong operational execution, we increased Auryxia revenue by 21 percent compared to the same period last year and reinforced the strength of our Auryxia intellectual property with an important ANDA settlement. We also achieved significant milestones with our development program for vadadustat, including a JNDA submission that we believe may establish vadadustat as the first oral hypoxia-inducible factor prolyl hydroxylase inhibitor (HIF-PHI) to file for regulatory approval for the treatment of anemia due to chronic kidney disease (CKD) in both dialysis dependent and non-dialysis dependent adult patients in a major market," stated John P. Butler, President and Chief Executive Officer of Akebia. "While there is still much work ahead of us, we remain confident and believe we have tremendous opportunities to advance our mission to better the lives of people with kidney disease and deliver significant value to all our stakeholders. We’ve been very purposeful in developing our strategy, and it’s great to see the benefits of our work coming to light as the team continues to systematically execute on our priorities."

Butler continued, "We’re excited by the opportunities to continue advancing Auryxia’s long-term growth story. The 26 percent sequential revenue growth we achieved over the first quarter demonstrates that the team is successfully executing against our near-term growth initiatives. The prescription demand that

we’ve seen in the first four weeks of the third quarter is the highest of any quarter since Auryxia was launched, affirming our confidence that Auryxia is on a solid growth trajectory. We believe continued progress on our growth initiatives and underlying market demand will drive increased revenue for Auryxia across the second half of the year."

Auryxia Highlights

Auryxia (ferric citrate) net product revenue increased 20.7 percent year-over-year to $29.1 million for the second quarter of 2019, and increased 26 percent when compared with the first quarter of 2019. Total Auryxia prescriptions increased 22 percent year-over-year to 49,200 in the second quarter of 2019.

In August, Akebia settled Auryxia patent litigation with Par Pharmaceutical, Inc. (Par), resolving patent litigation brought in response to an Abbreviated New Drug Application (ANDA) filing by Par. The settlement allows Par to market its generic version of Auryxia in the United States beginning on March 20, 2025 (subject to U.S. FDA approval), or earlier under certain circumstances customary for settlement agreements of this nature.

In July, Akebia’s collaboration partner, Japan Tobacco, Inc. and its subsidiary Torii Pharmaceutical Co., Ltd., reported positive top-line results from their pivotal Phase 3 comparative study evaluating Riona Tablets (generic name in Japan: ferric citrate hydrate) for the treatment of iron deficiency anemia (IDA) in adult patients in Japan. They have stated that they expect to file an application for approval of IDA as an additional indication for Riona in Japan upon successful completion of their Phase 3 program.

Vadadustat Highlights

In July, Mitsubishi Tanabe Pharma Corporation (MTPC), Akebia’s development and commercialization collaboration partner in Japan for vadadustat, submitted a Japanese New Drug Application (JNDA) to the Ministry of Health, Labor and Welfare in Japan for manufacturing and marketing approval of vadadustat as a treatment for anemia due to CKD. The JNDA is the first regulatory submission for marketing approval of vadadustat and, if approved, is expected to lead to the first launch of vadadustat worldwide. This JNDA submission triggered a $10 million milestone payment from MTPC to Akebia, which was received in August.

In April, Akebia completed enrollment in its global Phase 3 INNO2VATE studies evaluating the safety and efficacy of vadadustat in dialysis-dependent CKD subjects with anemia due to CKD. The Company continues to expect to report top-line data from both INNO2VATE studies in the second quarter of 2020, subject to the accrual of major adverse cardiovascular events (MACE).

Akebia expects enrollment in its global Phase 3 PRO2TECT studies evaluating the safety and efficacy of vadadustat in non-dialysis dependent CKD subjects with anemia due to CKD to be completed in 2019. The Company continues to expect to report top-line results in mid-2020, subject to the accrual of MACE.

Financial Results

Total revenue for the second quarter of 2019 was $100.8 million, compared to $48.8 million in the second quarter of 2018.

Auryxia net product revenue for the second quarter of 2019 was $29.1 million, compared to $24.1 million, as reported by Keryx Biopharmaceuticals, Inc. (Keryx) prior to its merger with the Company, during the same period in 2018. This represents a 20.7 percent increase in net product revenue from the second quarter of 2018 and a 26 percent increase compared to the first quarter of 2019. Auryxia is the Company’s FDA approved oral iron tablet to treat non-dialysis dependent adult CKD patients for IDA and dialysis-dependent adult CKD patients for hyperphosphatemia.

Collaboration revenue for the second quarter of 2019 was $71.7 million, compared with $48.8 million in the second quarter of 2018. The increase was primarily due to increased collaboration revenue of $11.4 million from Otsuka Pharmaceutical Co. Ltd (Otsuka), and $10.0 million from MTPC in accordance with the Company’s collaboration agreements. Otsuka began funding 80 percent of the development costs for vadadustat in the second quarter of 2019.

Cost of goods sold was $37.7 million for the second quarter of 2019, consisting of $9.6 million of costs associated with the manufacture of Auryxia and non-cash charges of $28.1 million related to the application of purchase accounting as a result of the merger with Keryx. These non-cash, merger-related charges include a $19.0 million inventory step-up charge and $9.1 million of amortization of intangibles.

Research and development expenses were $85.7 million for the second quarter of 2019 compared to $71.9 million for the second quarter of 2018. The increase was primarily attributable to an increase in external costs related to the continued advancement of the PRO2TECT and INNO2VATE Phase 3 studies of vadadustat as well as increases in headcount to support our research and development programs.

Selling, general and administrative expenses were $36.1 million for the second quarter of 2019 compared to $12.5 million for the second quarter of 2018. The increase in selling, general and administrative expenses was primarily attributable to commercialization costs associated with Auryxia, as there were no comparable commercialization costs in the second quarter of 2018.

The Company reported a net loss for the second quarter of 2019 of $58.2 million, or ($0.49) per share, as compared to a net loss of $34.1 million, or ($0.60) per share, for the second quarter of 2018. The Company’s net loss for the second quarter of 2019 includes the impact of non-cash charges of $28.1 million related to the application of purchase accounting as a result of the merger with Keryx.

The Company ended the quarter with cash, cash equivalents and available-for-sale securities of $136.8 million. "As we continue to effectively manage and leverage our operations, we expect our cash resources, including committed research and development funding from collaborators, to fund our current operating plan beyond the next twelve months, into the third quarter of 2020," stated Jason A. Amello, Chief Financial Officer of Akebia.

Conference Call

Akebia will host a conference call today, Thursday, August 8, 2019, at 9:00 a.m. Eastern Time to discuss its second quarter 2019 financial results and recent business updates. To listen to the conference call, please dial (877) 458-0977 (domestic) or (484) 653-6724 (international) using conference ID number 7274126. The call will also be webcast LIVE and can be accessed via the Investors section of the Company’s website at View Source

A replay of the conference call will be available two hours after the completion of the call through August 14, 2019. To access the replay, dial (855) 859-2056 (domestic) or (404) 537-3406 (international) and reference conference ID number 7274126. An online archive of the conference call can be accessed via the Investors section of the Company’s website at View Source