On March 14, 2017 ChemoCentryx, Inc., (Nasdaq:CCXI), a biopharmaceutical company developing new medications targeted at inflammatory and autoimmune diseases and cancer, reported financial results for the fourth quarter and full year ended December 31, 2016 (Press release, ChemoCentryx, MAR 14, 2017, View Source [SID1234518131]). Schedule your 30 min Free 1stOncology Demo! "2016 was a transformative year for ChemoCentryx," said Thomas J. Schall, Ph.D., President and Chief Executive Officer of ChemoCentryx. "We are now entering the next step in our evolution, driving the registration trials of our novel drug candidates and preparing for their commercialization. We have established a strong financial position through our partnership with Vifor Pharma and are now well positioned to execute on our plan to create value for patients and shareholders, starting with kidney disease."
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Recent Highlights
In December 2016, ChemoCentryx launched the Phase III ADVOCATE trial with avacopan for the treatment of ANCA-associated Vasculitis (AAV), a devastating autoimmune disease that destroys blood vessels and can lead to kidney failure. The design of the trial was agreed upon with the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA). ADVOCATE is a randomized, double-blind two arm study enrolling 300 patients across 200 sites in the United States and Europe.
In December 2016, ChemoCentryx and Vifor Pharma announced an expansion of their global kidney health alliance to include CCX140. Together with the avacopan deal announced in May 2016, the partnership with Vifor Pharma brought a total of $135 million in upfront cash commitments to ChemoCentryx in 2016, with the prospect of a further $1.2 billion in potential milestone payments.
In February 2017, ChemoCentryx and Vifor Pharma announced that they had harmonized the geographic commercialization rights for both drug candidates, with a further $20 million upfront commitment to ChemoCentryx.
ChemoCentryx retains the rights to commercialize avacopan and CCX140 for orphan and rare renal diseases in the United States and China, and will receive tiered double digit royalties on Vifor Pharma’s net sales in other markets.
Fourth Quarter and Full Year 2016 Financial Results
Pro forma cash, cash equivalents and investments totaled $194 million at December 31, 2016, which included the $50.0 million upfront commitment in connection with the December 2016 CCX140 agreement and the $20.0 million upfront commitment related to the February 2017 amendment to the avacopan agreement.
Revenue was $4.9 million for the fourth quarter, compared to zero for the same period in 2015. For the full year ended December 31, 2016, revenue was $11.9 million, compared to zero for 2015. The increase in revenue from 2015 to 2016 was due to: (i) amortization of the upfront payment from Vifor Pharma pursuant to the avacopan agreement and (ii) grant revenue from the FDA to support the clinical development of avacopan for the treatment of patients with AAV.
Research and development (R&D) expenses were $9.3 million for the fourth quarter, compared to $8.2 million for the same period in 2015. Full year 2016 R&D expenses were $38.0 million compared to $33.2 million in 2015. The increase in R&D expenses from 2015 to 2016 was primarily attributable to higher expenses associated with avacopan for start-up activities and ancillary studies related to the Phase III development program in patients with AAV. This increase was partially offset by lower expenses associated with Phase II development of avacopan, due to the completion of the CLEAR and CLASSIC Phase II clinical trials in 2016.
General and administrative (G&A) expenses were $3.6 million for the fourth quarter, compared to $3.4 million for the same period in 2015. Full year 2016 G&A expenses were $14.7 million, compared to $14.5 million in 2015. The increase from 2015 to 2016 was primarily due to higher professional service fees relating to the Company’s business development efforts.
Net losses for the fourth quarter were $7.7 million, compared to $11.6 million for the same period in 2015. Full year 2016 net losses, at $40.0 million, were also lower than the $47.3 million net losses in 2015.
Total shares outstanding at December 31, 2016 were approximately 48.1 million shares.
The Company expects to utilize cash and cash equivalents between $50 million and $55 million in 2017.