Santhera Reports Financial Results
News Sep 15, 2015
Santhera Pharmaceuticals has announced the financial results for the first half year 2015 and its transformation into a specialty pharmaceutical company with sustainable revenues from product sales. In June 2015, the Committee for Medicinal Products for Human Use (CHMP) recommended granting a marketing authorization in Europe for Raxone® for the treatment of Leber's Hereditary Optic Neuropathy (LHON) and Santhera expects a final decision from the European Commission (EC) very soon. In parallel, the Company advances Raxone®/Catena® with high priority towards approval in Duchenne Muscular Dystrophy (DMD) in Europe and the USA.
Thomas Meier, PhD, Chief Executive Officer of Santhera, commented on the first six months of 2015: "The recommendation for approval granted in June by the CHMP for Raxone as first treatment for LHON marks the biggest success in our Company's history. Raxone is to become the first treatment approved for any mitochondrial disease and will establish Santhera as leader in mitochondrial medicine. Subject to approval from the EC, we expect to roll out the commercial launch of Raxone in the first countries during the second half of the year, providing the first treatment opportunity to LHON patients who typically remain permanently blind if untreated. Based on the data from the successful Phase III trial in DMD, we continue to prepare for regulatory filings for Raxone/Catena in DMD in the fourth quarter of 2015, both in the United States of America and in Europe."
Christoph Rentsch, Chief Financial Officer of Santhera, added: "We recently raised CHF 27.7 million by the sale of 300,000 registered shares. Combined with the increased income from product sales during the first half this transaction substantially increased the Company's cash position, which at the end of August amounted to CHF 37.0 million. Santhera now has the financial resources to expedite the commercial launch of Raxone for the treatment of LHON in the European Union."
Key Financials in the First Half Year:
• Preparation for product launch increased cash burn during six-month period
As of June 30, 2015, Santhera had cash and cash equivalents of CHF 10.5 million. Net change in cash and cash equivalents in the first half year of 2015 increased to CHF -7.0 million (1H 2014: CHF 0 million) as a result of the ongoing preparation to launch Raxone in Europe.
• Increase in sales of Raxone
In the first six months of 2015, Raxone generated net sales of CHF 1.5 million (1H 2014: CHF 0.8 million), driven by increased product sales for LHON patients under the temporary authorization cATU in France as well as sales under named patient and special access programs.
• Higher operating expenses due to launch preparations and expanded operations
Operating expenses of CHF 7.4 million (1H 2014: CHF 3.9 million) were comprised of CHF 2.8 million in development, CHF 1.4 million in marketing and sales expenses, and CHF 3.1 million in general and administrative expenses (G&A). The increase reflects the hiring of a commercial team for the product launch, higher expenses in development due to preparation of regulatory filings and higher expenses in G&A resulting from the expansion of Santhera's operations. Consequently, the operating loss was CHF -6.0 million (1H 2014: CHF -3.1 million) leading to a net result of CHF -6.2 million (1H 2014: CHF -3.1 million).
Product and Pipeline Highlights:
• Received positive opinion from the CHMP
In June 2015, the CHMP recommended granting a marketing authorization for Raxone for the treatment of visual impairment in adolescent and adult patients with LHON. The formal marketing authorization from the EC for the product is expected shortly.
• Advanced preparation for product launch
In recent months, the Company prepared for a fast and efficient launch of Raxone which is planned for the first countries in coming weeks subject to EC approval.
• Published outcome of Phase III study in The Lancet and prepares for regulatory filings for Raxone/Catena in DMD in Europe and the USA
Earlier this year, the positive outcome of the Phase III study was published in The Lancet and presented at the annual meeting of the American Academy of Neurology. Based on available data from Santhera's development program with Raxone/Catena in DMD and supplemented by natural history data which we obtain from a collaboration with the Cooperative International Neuromuscular Research Group (CINRG), Santhera plans to submit a New Drug Application (NDA) in the USA and Marketing Authorization Application (MAA) as a variation to the EC approval in LHON. In April 2015, the US FDA has granted Fast Track Designation for Raxone/Catena for the treatment of DMD.
• Started dosing of first Congenital Muscular Dystrophy (CMD) patient with omigapil and completed patient recruitment in collaborative study with US National Institutes of Health (NIH)
The first patient in the CALLISTO Phase I trial was dosed with oral omigapil in a new formulation developed by Santhera for use in children. At the same time, all 20 participants required for the study have been selected, prescreened and randomly assigned to one of the three study cohorts. The study is being conducted at the NIH's National Institute of Neurological Disorders and Stroke in Bethesda (Maryland, USA) and assesses the pharmacokinetics, safety, and tolerability of omigapil in ambulatory and non-ambulatory children affected by either Ullrich or MDC1A subtypes of CMD.
• Expanded Executive Management and started building a commercial team
In the first half year of 2015, Santhera nominated three senior members of staff to its Executive Management and newly appointed a Chief Commercial Officer and a Chief Financial Officer in a step to prepare the Company for its growth strategy. Simultaneously, the Company started building a commercial team with experience in successfully managing the international commercialization of orphan and niche-market drug products.
In Europe, after approval from the EC, Raxone will be commercially launched in the first countries for the treatment of LHON starting in the second half of 2015.
The Company continues its interactions with regulatory authorities and plans to submit NDA and MAA filings for DMD based on the positive Phase III DELOS trial, the natural history study from the CINRG, and other supportive evidence of efficacy.
The Company believes that, with CHF 37.0 million as of end of August 2015, it has sufficient cash to support the commercial introduction of Raxone in Europe and the currently planned development and regulatory programs.