On July 31, 2019 Vanda Pharmaceuticals Inc. (Vanda) (Nasdaq: VNDA) reported financial and operational results for the second quarter ended June 30, 2019 (Press release, Vanda Pharmaceuticals, JUL 31, 2019, View Source [SID1234537965]).
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"The exceptional commercial performance of HETLIOZ and Fanapt positions Vanda to continue on its path of growth and long term value creation," said Mihael H. Polymeropoulos, M.D., Vanda’s President and CEO. "The recently announced positive results from the tradipitant motion sickness study further enhance the potentially broad therapeutic utility of tradipitant as a treatment option for the millions of patients with gastroparesis, motion sickness and atopic dermatitis."
Key Financial Highlights:
Total net product sales from HETLIOZ and Fanapt were $59.1 million in the second quarter of 2019, a 24% increase compared to $47.7 million in the first quarter of 2019 and a 25% increase compared to $47.4 million in the second quarter of 2018.
HETLIOZ net product sales were $37.8 million in the second quarter of 2019, a 31% increase compared to $29.0 million in the first quarter of 2019 and a 35% increase compared to $28.0 million in the second quarter of 2018.
Fanapt net product sales were $21.2 million in the second quarter of 2019, a 13% increase compared to $18.8 million in the first quarter of 2019 and a 10% increase compared to $19.3 million in the second quarter of 2018.
Cash, cash equivalents and marketable securities (Cash) were $292.7 million as of June 30, 2019, representing an increase to Cash of $24.8 million as compared to March 31, 2019.
Key Research and Development Highlights:
Tradipitant
In July 2019, Vanda announced positive results from a Phase II clinical study (Motion Sifnos) of tradipitant in motion sickness. Patients with a prior history of motion sickness were treated with tradipitant or placebo prior to a chartered trip on the Pacific Ocean. In this setting, significantly fewer patients on tradipitant vomited than those on placebo. Vanda intends to initiate a Phase III program in motion sickness in 2019 with a plan to file for marketing authorization in 2020.
After meeting with the U.S. Food and Drug Administration (FDA) in May 2019 to discuss the Phase III program, Vanda initiated a Phase III clinical study of tradipitant in gastroparesis in the second quarter of 2019 and plans to begin randomizing patients in the third quarter of 2019.
Enrollment in the Phase III clinical study (EPIONE) of tradipitant in atopic dermatitis is ongoing. Results are expected in the first half of 2020. A second Phase III clinical study is expected to begin in the first quarter of 2020.
HETLIOZ (tasimelteon)
The FDA’s review of the supplemental New Drug Application (sNDA) of HETLIOZ for the treatment of jet lag disorder is ongoing with a Prescription Drug User Fee Act (PDUFA) target date of August 16, 2019. On July 19, 2019, Vanda received a "Deficiencies Preclude Discussion" letter from the FDA. The letter does not specify any deficiencies in the file at this time. Vanda will await the PDUFA action and work expeditiously to resolve any potential deficiencies.
Vanda expects to file a sNDA for HETLIOZ for the treatment of Smith-Magenis Syndrome in the third quarter of 2019.
Vanda plans in the third quarter of 2019 to initiate a Phase II clinical study of HETLIOZ in delayed sleep phase disorder (DSPD) in patients who have a mutation in the CRY1 gene, which is believed to be causative in a subset of patients with DSPD.
Fanapt (iloperidone)
Enrollment is ongoing in a pharmacokinetic study for the once-a-month long acting injectable (LAI) formulation of Fanapt.
A randomized study of Fanapt in bipolar disorder is planned to begin in 2019.
VTR-297 (histone deactetylase (HDAC) inhibitor)
Enrollment is ongoing in a Phase I clinical study (1101) of VTR-297 in hematologic malignancies.
Non-GAAP Financial Results
Non-GAAP net income was $15.0 million for the second quarter of 2019, or $0.28 per share, compared to a Non-GAAP net income of $7.7 million, or $0.15 per share, for the second quarter of 2018.
Vanda provides Non-GAAP financial information, which it believes can enhance an overall understanding of its financial performance when considered together with GAAP figures. Refer to the sections of this press release entitled "Non-GAAP Financial Information" and "Reconciliation of GAAP to Non-GAAP Financial Information" for more detailed information regarding Non-GAAP financial information.
2019 Financial Guidance
Vanda reiterates its prior 2019 net product sales guidance and provides an update to Year-end 2019 Cash and expects to achieve the following financial objectives in 2019:
Conference Call
Vanda has scheduled a conference call for today, Wednesday, July 31, 2019, at 4:30 PM ET. During the call, Vanda’s management will discuss the second quarter 2019 financial results and other corporate activities. Investors can call 1-866-688-9426 (domestic) or 1-409-216-0816 (international) and use passcode 2589983. A replay of the call will be available on Wednesday, July 31, 2019, beginning at 7:30 PM ET and will be accessible until Wednesday, August 7, 2019, at 7:30 PM ET. The replay call-in number is 1-855-859-2056 for domestic callers and 1-404-537-3406 for international callers. The passcode number is 2589983.
The conference call will be broadcast simultaneously on Vanda’s website, www.vandapharma.com. Investors should click on the Investor Relations tab and are advised to go to the website at least 15 minutes early to register, download, and install any necessary software or presentations. The call will also be archived on Vanda’s website for a period of 30 days.
Non-GAAP Financial Information
Vanda believes that the Non-GAAP financial information provided in this press release can assist investors in understanding and assessing the ongoing economics of Vanda’s business and reflect how it manages the business internally and sets operational goals. Vanda’s "Non-GAAP Selling, general and administrative expenses" and "Non-GAAP Research and development expenses" exclude stock-based compensation. Vanda’s "Non-GAAP Net income," "Non-GAAP Net income per share" and "Non-GAAP Operating expenses excluding Cost of goods sold" exclude stock-based compensation and intangible asset amortization.
Vanda believes that excluding the impact of these items better reflects the recurring economic characteristics of its business, as well as Vanda’s use of financial resources and its long-term performance.
These Non-GAAP financial measures, as presented, may not be comparable to similarly titled measures reported by other companies since not all companies may calculate these measures in an identical manner and, therefore, they are not necessarily an accurate measure of comparison between companies.
The presentation of these Non-GAAP financial measures is not intended to be considered in isolation or as a substitute for guidance prepared in accordance with GAAP. The principal limitation of these Non-GAAP financial measures is that they exclude significant elements that are required by GAAP to be recorded in Vanda’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management in determining these Non-GAAP financial measures. In order to compensate for these limitations, Vanda presents its Non-GAAP financial guidance in connection with its GAAP guidance. Investors are encouraged to review the reconciliation of our Non-GAAP financial measures to their most directly comparable GAAP financial measure.