On May 2, 2016 Merrimack Pharmaceuticals, Inc. (Nasdaq: MACK) reported its first quarter 2016 financial results (Press release, Merrimack, MAY 2, 2016, View Source [SID:1234511803]). Schedule your 30 min Free 1stOncology Demo! Merrimack will host a live conference call and webcast today, Monday, May 2 at 4:30 p.m., Eastern time, to provide an update on Merrimack’s progress as well as a summary of these results.
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Schedule Your 30 min Free Demo!
Investors and the general public are invited to listen to the call by dialing (877) 564-1301 (domestic) or (224) 357-2394 (international) five minutes prior to the start of the call and providing the passcode 90717802. A listen-only webcast of the call can be accessed in the Investors section of Merrimack’s website, investors.merrimack.com, and a replay of the call will be archived there for six weeks following the call.
ONIVYDE (irinotecan liposome injection) Update
Merrimack received approval for ONIVYDE from the U.S. Food and Drug Administration on October 22, 2015 and launched ONIVYDE in the United States on October 26, 2015;
In March 2016, the ONIVYDE regimen was added to the National Comprehensive Cancer Network (NCCN) 2016 Clinical Practice Guidelines in Oncology as a Category 1 Treatment Option for patients with metastatic pancreatic adenocarcinoma who have previously been treated with gemcitabine-based therapy; and
Gross product revenues from U.S. commercial sales of ONIVYDE for the first quarter of 2016 were $11.3 million, while net product revenues were $10.0 million.
Key Recent Events
Merrimack’s key recent events include:
Completion of the safety portion and transition to part two of the Phase 2 clinical study of MM-141 in patients with front-line metastatic pancreatic cancer;
Unveiling of Merrimack’s latest antibody directed nanotherapeutic (ADN), MM-310, and presentation of clinical and preclinical research demonstrating advances across Merrimack’s extensive oncology pipeline, including ONIVYDE, MM-302, MM-310, MM-141 and MM-151, at the 2016 American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting; and
Announcement of a strategic partnership with Leica Biosystems to develop Merrimack’s novel heregulin assay for seribantumab (MM-121) into a kit for commercial use.
Upcoming Milestones
Merrimack anticipates the following upcoming clinical milestones:
Results in 2017 from the Phase 2 clinical study of ONIVYDE in previously untreated front-line metastatic pancreatic cancer;
Results in 2017 from HERMIONE, the Phase 2 clinical study of MM-302 in patients with HER2-positive metastatic breast cancer that is designed to support a potential Accelerated Approval application to the FDA;
Results in 2018 from the Phase 2 clinical study of MM-141 in patients with front-line metastatic pancreatic cancer who have high serum levels of free IGF-1; and
Results in 2018 from the Phase 2 clinical study of MM-121 in patients with heregulin-positive, locally advanced or metastatic non-small cell lung cancer that is designed to support a potential Biologics License Application to the FDA.
First Quarter 2016 Financial Results
The following summarizes Merrimack’s financial results from the quarter ended March 31, 2016:
Product revenues from the commercial sale of ONIVYDE, net of discounts, allowances and reserves, were $10.0 million for the first quarter of 2016, compared to $4.3 million for the fourth quarter of 2015. This represents an increase of $5.7 million, or 133%, over the prior quarter;
License and collaboration revenues were $11.3 million for the first quarter of 2016, compared to $17.1 million for the fourth quarter of 2015. This represents a decrease of $5.8 million from the prior quarter. This revenue was recognized under the proportional performance revenue recognition model, and the decrease is due to the timing of work performed under Merrimack’s Baxalta collaboration;
Aggregate research and development and selling, general and administrative expenses were $50.7 million for the first quarter of 2016, compared to $64.1 million for the fourth quarter of 2015. This represents a decrease of $13.4 million, or 21%, which was made up of the following:
$11.9 million of decreased research and development expenses due primarily to one-time drug purchases that occurred in the fourth quarter of 2015 as well as the wind down and close out of various clinical trials in the first quarter of 2016; and
$1.5 million of decreased selling, general and administrative expenses due to increased costs related to the launch of ONIVYDE in the fourth quarter of 2015;
Interest expense for the first quarter of 2016 was $8.6 million, compared to $5.7 million for the fourth quarter of 2015. This $2.9 million increase was due to the new 11.5% senior secured notes due 2022 issued in the fourth quarter of 2015; and
Net loss attributable to Merrimack for the first quarter of 2016 was $38.5 million, or $0.33 per share, compared to a net loss attributable to Merrimack of $47.8 million, or $0.41 per share, for the fourth quarter of 2015.
2016 Financial Outlook
Merrimack reiterates the following fiscal 2016 guidance:
Receipt of $46.5 million of net milestone payments related to ONIVYDE. This amount is made up of $36.5 million of net substantive milestones expected to increase net income in 2016 and $10.0 million of net non-substantive milestones expected to increase deferred revenues on Merrimack’s balance sheet, as they are included in the Baxalta proportional performance revenue recognition model; and
Aggregate research and development and selling, general and administrative expenses to be in the range of $225 million to $245 million, not including any one time payments to PharmaEngine.
Merrimack 2016 Analyst Day
Merrimack will host an Analyst Day on May 19, 2016 in New York for analysts and institutional investors, where it will provide an update on Merrimack’s pipeline, including the development plan for ONIVYDE. In attendance will be key members of Merrimack’s science and clinical teams, as well as featured guest speaker Charles Fuchs, M.D., M.P.H., of Dana-Farber Cancer Institute, who will speak on the gastrointestinal cancer space.
A live webcast of the event will be available in the Investors section of Merrimack’s website, investors.merrimack.com, and a replay of the webcast will be archived there for six weeks.
Upcoming Investor Conferences
Merrimack will attend the following investor conferences in the coming months:
Deutsche Bank Securities 41st Annual Healthcare Conference on May 4 in Boston; and
Wells Fargo Securities Biotech Corporate Access Day on July 26 in Boston.
A live webcast of the presentation at the Deutsche Bank Securities 41st Annual Healthcare Conference can be accessed by visiting the Investors section of Merrimack’s website at investors.merrimack.com. A replay of the webcast will be archived there for two weeks following the presentation.