On March 11, 2019 ChemoCentryx, Inc., (Nasdaq:CCXI), reported financial results for the fourth quarter and full year ended December 31, 2018 and provided an overview of the Company’s recent corporate highlights (Press release, ChemoCentryx, MAR 11, 2019, View Source [SID1234534214]).
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"We at CCXI marched through 2018, achieving essential objectives both tactical and strategic," said Thomas J. Schall, Ph.D., President and Chief Executive Officer of ChemoCentryx. "Those 2018 achievements now set the stage for a suite of successive late-stage data readouts starting in the fourth quarter of this year with top-line results from the pivotal ADVOCATE Phase III trial of avacopan in ANCA-associated vasculitis."
"But ADVOCATE was just the beginning of the pipeline in a drug strategy for avacopan. Another step was the launching in December of the AURORA trial of avacopan in hidradenitis suppurativa, a disfiguring and debilitating skin disorder. AURORA is a large, potentially registration-supporting clinical trial of avacopan, and we aim for top-line data as soon as mid-2020. The third step in the strategy is avacopan in C3 glomerulopathy. The C3G trial has shown strong enrollment trends; putting us again in a position to obtain top-line data for this devastating condition in 2020. Keen observers will be mindful that our renal orphan disease franchise has a second unique asset: the CCR2 inhibitor CCX140 for the treatment of focal segmental glomerulosclerosis in our LUMINA trials program."
"CCXI’s financial position remains strong and provides us the financial foundation to run these trials simultaneously, and to achieve the data objectives outlined here. Our basic science and discovery platform continues to create value – identifying novel modes of action of our late stage pipeline assets avacopan and CCX140, while also moving toward additional, novel pipeline candidates in renal and dermal disease. For all of these reasons, I think this is one of the most exciting and most promising times in the history of the enterprise."
Recent Highlights
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Launched the Company’s Phase IIb clinical trial of avacopan for the treatment of Hidradenitis Suppurativa (HS), called the AURORA trial. HS is a chronic disabling skin autoimmune disease characterized by recurrent, painful, nodules, boils and abscesses. A proof-of-concept study has demonstrated that HS is driven by neutrophils produced by C5a. The AURORA trial aims to enroll 390
patients with moderate to severe HS. The primary endpoint will assess avacopan against placebo at 12 weeks of treatment, using the HiSCR (hidradenitis suppurativa clinical response) scale, which has been validated by the FDA. All groups will be followed for an additional 24 weeks. Secondary endpoints include percent improvement from baseline to week 12 between groups, validated secondary measurements and quality of life measured using the HS Quality of Life Instrument (HiSQOL) and SF36 health assessment.
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Advanced enrollment in the Company’s clinical trial of avacopan in patients with the kidney disease C3 Glomerulopathy (C3G). Enrollment in this randomized control trial of 88 C3G patients now approaches 50%. C3G is a rare disorder that often affects the young, requiring dialysis and often kidney transplant with recurring disease common. There is no approved effective treatment for C3G.
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Reached a milestone in the Company’s clinical trials of CCX140 in two sub-populations of Focal Segmental Glomerulosclerosis (FSGS), a rare kidney disease: the LUMINA 1 trial, evaluating patients with sub-nephrotic primary FSGS, is over 50% enrolled. Enrollment in LUMINA 2, evaluating nephrotic syndrome primary FSGS, continues.
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Maintained a robust balance sheet, with reported cash and investments exceeding $175 million at December 31, 2018, excluding an additional cash raise of $20 million in January 2019.
Fourth Quarter and Full Year 2018 Financial Results
Cash and investments, totaled $177.0 million at December 31, 2018, excluding $20.0 million in gross proceeds from the January 2019 issuance of common stock under the Company’s equity distribution agreement.
Revenue was $9.3 million for the fourth quarter of 2018, compared to $56.3 million for the same period in 2017. For the full year ended December 31, 2018, revenue was $42.9 million, compared to $82.5 million for 2017. The decrease in revenue from 2017 to 2018 was due to the adoption of ASC 606 under the modified retrospective transition method and reflected the cumulative effect of initially applying the new revenue standard of $47.3 million as an adjustment to the opening balance of accumulated deficit and an increase in deferred revenue. Revenue recognized prior to January 1, 2018 has not been restated and continues to be reported under the accounting standards in effect for those periods.
Research and development expenses were $15.1 million for the fourth quarter of 2018, compared to $12.9 million for the same period in 2017. Full year 2018 research and development expenses were $62.7 million compared to $49.5 million in 2017. The increase in research and development expenses from 2017 to 2018 was primarily due to the advancement of the avacopan ADVOCATE Phase III pivotal trial which completed enrollment in July 2018, initiation and patient enrollment of the avacopan Phase II clinical trials in patients with C3G and HS and the CCX140 Phase II clinical trials in patients with FSGS.
General and administrative expenses were $5.6 million for the fourth quarter of 2018, compared to $4.1 million for the same period in 2017. Full year 2018 general and administrative expenses were $20.4 million, compared to $16.5 million in 2017. The increase from 2017 to 2018 was primarily due to higher employee-related expenses, including those associated with our commercialization planning efforts, and higher professional fees.
Net loss for the fourth quarter of 2018 was $10.8 million, compared to net income of $39.7 million for the same period in 2017. Full year 2018 net loss was $38.0 million, compared to net income of $17.9 million in 2017.
Total shares outstanding at December 31, 2018 were approximately 50.7 million shares.
The Company expects to utilize cash and investments in the range of $75.0 million and $85.0 million in 2019.
Conference Call and Webcast
The Company will host a conference call and webcast today, March 11, 2019 at 5:00 p.m. Eastern Time / 2:00 p.m. Pacific Time. To participate by telephone, please dial 877-303-8028 (Domestic) or 760-536-5167 (International). The conference ID number is 2269237. A live and archived audio webcast can be accessed through the Investors section of the Company’s website at www.ChemoCentryx.com. The archived webcast will remain available on the Company’s website for fourteen (14) days following the conference call.