On March 7, 2019 Sunesis Pharmaceuticals, Inc. (Nasdaq: SNSS) reported financial results for the fourth quarter and year ended December 31, 2018 (Press release, Sunesis, MAR 7, 2019, View Source [SID1234534114]). Loss from operations for the three months and year ended December 31, 2018 was $5.8 million and $25.7 million. As of December 31, 2018, cash and cash equivalents totaled $13.7 million. Subsequent to the end of the quarter, the company raised $20 million in gross proceeds from concurrent underwritten public offerings in January.
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"We began 2019 by announcing the move into the 100 mg cohort for our Phase 1b/2 trial of vecabrutinib, an important milestone as we continue to believe that 100 – 300 mg will be the potentially therapeutic dose levels," said Dayton Misfeldt, Interim Chief Executive Officer of Sunesis. "To date, we have seen an encouraging safety profile, evidence of pharmacodynamic activity and some improvements in clinical symptoms in CLL and other B cell cancer patients both with and without BTK C481 mutations. We are targeting an update on our ongoing vecabrutinib trial at the European Hematology Association (EHA) (Free EHA Whitepaper) Congress (EHA) (Free EHA Whitepaper) in June 2019. In addition, in January, we completed an equity offering with leading biotechnology investors that extends our runway through important clinical milestones."
Recent Highlights
Announced Advancement into 100mg Cohort. In January 2019, the Company announced that it had opened the 100 mg cohort in the Phase 1b/2 trial of its non-covalent BTK inhibitor vecabrutinib in adults with relapsed/refractory chronic lymphocytic leukemia (CLL) and other B-cell malignancies.
The latest protocol amendment, approved by most sites in February 2019, allows for upfront enrollment of up to 6 evaluable patients into a cohort, and we have taken advantage of this to allocate additional slots for the 100mg cohort. By studying more patients and collecting more data, we can better characterize vecabrutinib’s profile at this dose level.
Completion of $20 million Financing. In January, Sunesis announced the completion of an equity financing with net proceeds of approximately $18.4 million. The financing attracted participation from leading biotechnology investors and will allow Sunesis to advance vecabrutinib through important clinical milestones as we explore the potentially active dose levels.
Presentation of Preliminary Data at the ASH (Free ASH Whitepaper) Annual Meeting. In December 2018, Sunesis presented preliminary data from the Phase 1b/2 clinical trial of its non-covalent BTK inhibitor vecabrutinib in adults with relapsed/refractory chronic lymphocytic leukemia (CLL) and other B-cell malignancies.
Financial Highlights
Cash and cash equivalents totaled $13.7 million as of December 31, 2018, as compared to $31.8 million as of December 31, 2017. The decrease of $18.1 million was primarily due to $24.4 million of net cash used in operating activities, partially offset by $6.3 million in net proceeds from issuance of common stock.
Revenue was $0.2 million in 2018 as compared to $0.7 million in 2017, primarily due to deferred revenue related to the Royalty Agreement with RPI Finance Trust, which was fully amortized to revenue in March 2017.
Research and development expense was $3.3 million and $14.6 million for the three months and year ended December 31, 2018, as compared to $3.7 million and $21.5 million for the same periods in 2017. The decreases in 2018 were primarily due to the 2017 $2.5 million Biogen payment, a $2.8 million decrease in professional services related to the 2017 vosaroxin regulatory filing with the European Medicines Agency, and a $1.8 million decrease in salary and related expenses, partially offset by an increase in clinical expenses of $0.5 million for work related to the development of vecabrutinib.
General and administrative expense was $2.5 million and $11.3 million for the three months and year ended December 31, 2018, as compared to $2.8 million and $13.5 million for the same periods in 2017. The decreases in 2018 were primarily due to a $1.4 million decrease in professional services, a $0.5 million decrease in salary and related expenses, and a $0.3 million decrease in vosaroxin commercial expenses.
Interest expense was $0.3 million and $1.2 million for the three months and year ended December 31, 2018, as compared to $0.3 million and $1.4 million for the same periods in 2017. The decrease in 2018 was primarily due to the decrease in the outstanding notes payable.
Cash used in operating activities was $24.4 million for the year ended December 31, 2018, as compared to $36.1 million for the same period in 2017. Net cash used in operating activities in 2018 resulted primarily from the net loss of $26.6 million and changes in operating assets and liabilities of $0.6 million, offset by net adjustments for non-cash items of $2.8 million.
Loss from operations was $5.8 million and $25.7 million for the three months and year ended December 31, 2018, as compared to $6.4 million and $34.4 million for the same periods in 2017. Net loss was $6.0 million and $26.6 million for the three months and year ended December 31, 2018, as compared to $6.6 million and $35.5 million for the same periods in 2017.
Conference Call Information
Sunesis will host a conference today at 4:30 p.m. Eastern Time. The call can be accessed by dialing (844) 296-7720 (U.S. and Canada) or (574) 990-1148 (international) and entering passcode 6225859. To access the live audio webcast, or the subsequent archived recording, visit the "Investors and Media – Calendar of Events" section of the Sunesis website at www.sunesis.com. The webcast will be recorded and available for replay on the company’s website for two weeks.