On April 23, 2019 Akari Therapeutics, Plc (Nasdaq: AKTX), a biopharmaceutical company focused on innovative therapeutics to treat orphan autoimmune and inflammatory diseases where complement and/or leukotriene systems are implicated, reported its financial results for the fourth quarter and full year ended December 31, 2018 (Press release, Akari Therapeutics, APR 23, 2019, View Source [SID1234535343]).
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"The last several months were an important period in which a number of clinical and preclinical study results validated our focus on poorly treated orphan diseases where the combined inhibition of the complement and leukotriene pathways provides a novel treatment option for Nomacopan (Coversin), our dual action C5 and LTB4 inhibitor," said Clive Richardson, Interim Chief Executive Officer of Akari Therapeutics. "During the last six months, the Company has broadened its clinical targets with two new ongoing orphan disease programs in bullous pemphigoid and atopic keratoconjunctivitis, and a third hematopoietic stem cell transplant-related thrombotic microangiopathy anticipated to open later this year."
Full Year 2018 and Recent Business Highlights
§Phase II clinical trial in patients with bullous pemphigoid (BP).
Initial results recently announced from the ongoing six-week open-label single-arm Phase II clinical trial evaluating Nomacopan (Coversin) in patients with BP showed for the first three patients no drug-related adverse events and a rapid reduction in BPDAI index (see Company press release issued April 23, 2019)
§Phase I/II clinical trial in patients with atopic keratoconjunctivitis (AKC).
‒AKC is an eye surface inflammatory disease and is one of a larger group of ocular surface inflammatory diseases associated with severe dry-eye including vernal keratoconjunctivitis (VKC), Sjögren’s syndrome and mucous membrane pemphigoid which are currently inadequately treated and may result in permanent loss of vision.
‒An interim update of the Phase I/II AKC clinical trial is planned to coincide with the Association for Research in Vision and Ophthalmology (ARVO) 2019 annual meeting, April 28-May 2, where a poster will also be presented showing Nomacopan’s (Coversin’s) effect in a preclinical model of autoimmune uveitis, a back of the eye orphan disease with significant unmet need. Uveitis is an inflammatory disease affecting the uvea (pigmented layer of the eye).
§Pediatric hematopoietic stem cell transplant-related thrombotic microangiopathy (HSCT-TMA).
In March 2019, Akari announced it had a successful Type B, pre-IND meeting with the Food and Drug Administration (FDA) regarding its proposed pivotal clinical trial program for HSCT-TMA, outlining the clinical development path ahead for this program. In September 2018, Akari announced that in the first two patients treated with Nomacopan (Coversin) as part of a UK named patient program, it had observed a rapid reduction of the markers of complement activation as well as normalization of markers that are elevated in thrombotic microangiopathy (TMA).
‒A pivotal clinical trial for pediatric HSCT-TMA patients is expected to start in the fourth quarter of 2019. TMA-HSCT is expected to be the Company’s gateway indication into the broader TMA space which includes a large number of related and poorly treated orphan diseases including atypical hemolytic syndrome (aHUS). In order to accommodate the new focus on the broader TMA space, the current aHUS Phase II program is being put on hold and will be reviewed in order to align with the wider TMA program.
Paroxysmal nocturnal haemoglobinuria (PNH). Ongoing Phase III, multicenter trial in naïve patients and a Phase II trial in patients who are resistant to eculizumab.
Nomacopan (Coversin) auto-injector pen
§New data in a pig model has shown a similar PK profile for the higher concentrated formulation to be used across the Company’s subcutaneous programs. This new highly concentrated formulation with small (0.3mL) volume and water-like viscosity is intended to allow ease of administration and increased patient comfort for use alongside a new auto-injector pen holding a week’s dosing stable at room temperature.
Long-term safety study for Nomacopan (Coversin)
§Total cumulative number of patient-years on Nomacopan (Coversin) treatment over 16 years.
§All patients in the long term study have now been treated for more than one year and the first patient has now been treated for over three years.
§No drug related serious adverse events and no neutralizing antibodies reported to date.
§Six PNH patients were transfusion dependent prior to treatment with Nomacopan (Coversin), of which four in the long-term study are now transfusion independent.
Upcoming Events and Milestones
§Update on eye disease program, including initial data from Phase I/II clinical trial in patients with AKC and data from a pre-clinical back of the eye study expected during ARVO Annual Meeting, April 28-May 2, 2019.
§HSCT-TMA pivotal clinical trial expected to start fourth quarter of 2019.
§Expansion of BP Phase II clinical trial into the severe patient population.
§Initiate a Phase I clinical trial with new auto-injector pen formulation in the second half of 2019.
Fourth Quarter and Full Year 2018 Financial Results
§Research and development (R&D) expenses in the fourth quarter of 2018 were $2.4 million, as compared to $7.1 million in the same quarter the prior year. This decrease was due primarily to lower manufacturing and clinical costs associated with Nomacopan (Coversin). R&D expenses for full year 2018 were $11.8 million, as compared to $23.3 million for the prior year. The decrease was due primarily to lower manufacturing costs for Nomacopan (Coversin) as the Company had previously manufactured clinical trial material for supply through 2019, and an R&D tax credit which offset overall R&D expenses.
§General and administrative (G&A) expenses in the fourth quarter of 2018 were $2.4 million, as compared to $3.8 million in the same quarter last year. This decrease was due primarily to lower personnel expenses. G&A expenses for the full year 2018 were $10.9 million, as compared to $11.8 million in 2017. This decrease was due primarily to lower personnel, stock-based non-cash compensation and recruiting expenses, offset by higher expenses for professional fees, rent, insurance and other miscellaneous expenses.
§Litigation settlement gain for the year ended December 31, 2018 was $2,700,000 which was recorded in the consolidated statements of comprehensive loss during the third quarter of 2018. This relates to the receipt of funds from the Company’s insurance carrier in 2018 used to settle the Company’s securities class action lawsuit which was accrued for in 2017.
§Total other income for the fourth quarter of 2018 was $1.2 million, as compared to $1.5 million in the same quarter the prior year, and, for the full year 2018, $3.5 million as compared to $2.4 million in 2017. This change was primarily attributed to higher income related to the change in the fair value of the stock option liabilities in 2018 than in 2017, and foreign exchange gains in 2018 as compared to foreign exchange losses in 2017.
§Net loss for the fourth quarter of 2018 was $3.5 million, compared to a net loss of $12.1 million for the same period in 2017. Net loss for full year 2018 was $16.5 million, as compared to $35.4 million for the prior year. This year over year decrease in net loss was due primarily to the aforementioned $2.7 million litigation settlement gain, lower R&D expenses and change in fair value of the stock option and warrant liabilities, which were lower in 2018.
§As of December 31, 2018, the Company had cash of $5.4 million, as compared to cash of $28.1 million as of December 31, 2017. During the first quarter of 2019 the Company received a research and development cash tax credit of approximately $4.9 million.
§On September 26, 2018, the Company entered into a securities purchase agreement (the "Purchase Agreement") with Aspire Capital Fund, LLC ("Aspire Capital"), which provides that, upon the terms, Aspire Capital is committed to purchase up to an aggregate of $20.0 million of the Company’s ADSs over the 30-month term of the Purchase Agreement. In consideration for entering into the Purchase Agreement, concurrently with the execution of the Purchase Agreement, the Company issued 30,000,000 ordinary shares to Aspire Capital and sold to Aspire Capital 25,000,000 ordinary shares for $0.02 per share (equivalent to $2.00 per ADS) for gross proceeds of $500,000. Subsequently, in March 2019, the Company sold to Aspire Capital 5,000,000 ordinary shares to Aspire Capital 2019 at $0.0346 per share (equivalent to $3.46 per ADS) for gross proceeds of $173,000. Currently, $19.3 million remains available for draw drawn from this facility.
A copy of the Company’s Annual Report on Form 20-F for the year ended December 31, 2018 has been filed with the Securities and Exchange Commission and posted on the Company’s website at View Source You may request a copy of the Company’s Form 20-F, at no cost to you, by writing to the Chief Financial Officer of the Company at 75/76 Wimpole Street, London W1G 9RT, United Kingdom or by calling the Company at +44 20 8004 0261.