Liquidia Reports Second Quarter 2020 Financial Results and Provides Corporate Update
Received FDA Acceptance of LIQ861 NDA for Review
Reported Final Safety and Tolerability Results for LIQ861 INSPIRE Trial
Announced Definitive Agreement to
Completed Public Offering of Common Stock
Company to Host Webcast and Conference Call Today at 4:30 p.m. ET
“The second quarter of 2020 was marked by progress as we continued to execute effectively against key milestones that strengthen our position for the launch of LIQ861 and the future value of our company,” said
- Received FDA acceptance of LIQ861 NDA for regulatory review
April 2020, the U.S. Food and Drug Administration(FDA) accepted Liquidia’s New Drug Application (NDA) for LIQ861, the Company’s lead product candidate as a potential treatment for patients with pulmonary arterial hypertension (PAH), for review and provided a Prescription Drug User Fee Act (PDUFA) goal date of November 24, 2020. LIQ861 is an investigational, inhaled dry powder formulation of treprostinil designed and engineered using Liquidia’s novel PRINT technology with the goal of enhancing deep-lung delivery of treprostinil in PAH patients by means of a convenient, palm-sized dry powder inhaler.
- Reported final LIQ861 safety and tolerability results from pivotal INSPIRE trial
April 2020, the Company reported final safety and tolerability results from the two-month endpoint of the open-label phase 3 trial, INSPIRE, or Investigation of the Safety and Pharmacology of Dry Powder Inhalation of Treprostinil, for LIQ861. Of the 121 PAH patients, 113, or 93 percent, completed their two-month visit. The most common reported treatment-emergent adverse events (TEAEs) (reported in ≥ four percent) were cough (42 percent), headache (26 percent), throat irritation (16 percent), dizziness (11 percent), diarrhea (9 percent), chest discomfort (8 percent), nausea (7 percent), dyspnea (5 percent), flushing (5 percent) and oropharyngeal pain (4 percent). These final primary endpoint findings are consistent with the safety and tolerability results previously reported.
Tushar Shah, M.D. as Chief Medical Officer
May 2020, the Company announced the appointment of Tushar Shah, M.D. to the newly created position of Chief Medical Officer. In this role, Dr. Shahwill oversee all aspects of research, clinical development, medical affairs and regulatory affairs. Dr. Shahhas 27 years of pharmaceutical research and development experience, successfully advancing more than 20 products from early development to commercialization.
- Announced definitive agreement to acquire
June 2020, the Company announced it had entered into a definitive agreement to acquire RareGen, LLC, a portfolio company of PBM Capital, through an all-stock merger. Liquidiaand RareGen will consolidate under a new holding company, named Liquidia Corporation, which is expected to trade on the Nasdaq Capital Market under the ticker symbol “LQDA,” as the successor to Liquidia Technologiesfollowing completion of the proposed merger.
$75 millionpublic offering of common stock
July 2020, the Company announced the closing of an underwritten public offering of 9,375,000 shares of its common stock at a price of $8.00per share, for total gross proceeds of $75 million, before deducting underwriting discounts and commissions and other offering expenses.
- Received complaint from United Therapeutics Corporation under Hatch-Waxman Act
June 2020, United Therapeutics Corporation (UTC) filed a complaint for patent infringement against the Company in the U.S. District Court for the District of Delawareasserting infringement of U.S.Patent Nos. 9,604,901 (the ’901 Patent) and 9,593,066 (the ’066 Patent) relating to United Therapeutics’ Tyvaso®, a nebulized treprostinil solution for the treatment of PAH. The complaint is in response to the LIQ861 NDA filed with the FDA. The LIQ861 NDA was filed under the 505(b)(2) regulatory pathway with Tyvaso® as the reference listed drug. Under the Hatch-Waxman Act, the FDA is automatically precluded from approving the LIQ861 NDA for up to 30 months, absent an earlier judgment unfavorable to UTC by the court with respect to the ‘901 Patent and ‘066 Patent. In July 2020, UTCfiled an amended complaint in the lawsuit asserting infringement of U.S.Patent No. 10,716,793 (the ‘793 Patent). The infringement allegations of the ‘793 Patent is separate from the 30-month regulatory stay on final approval of the NDA for LIQ861, which is only associated with the infringement allegations of the ‘901 Patent and the ‘066 Patent. On July 30, 2020, Judge Andrews, presiding over the Hatch-Waxman Litigation, conducted a scheduling conference and set a claim construction hearing in May 2021and set the trial to begin in March 2022.
Second Quarter 2020 Financial Results
- Revenues: No revenue was recorded for the second quarter of 2020, compared with
$8.1 millionfor the second quarter of 2019. Revenue during the second quarter of 2019 was due to the recognition of $8.1 millionof deferred revenue from our Inhaled Collaboration and Option Agreement with a subsidiary of GlaxoSmithKline plc, resulting from the third amendment to such agreement that was entered into in June 2019.
- Cost of Revenue: Cost of revenue was
$0for the second quarter of 2020, compared to $0.8 millionfor the second quarter of 2019. The decrease of $0.8 millionwas due to the decrease in revenue. Cost of revenue represents sub-licensing fees paid to The University of North Carolina at Chapel Hill, or UNC, when licensing revenue is recognized from the use of the intellectual property in-licensed from UNC.
- Research and Development (R&D): R&D expenses were
$8.5 millionfor the second quarter of 2020 compared with $10.7 millionfor the second quarter of 2019. The decrease of $2.2 millionwas primarily driven by a decrease in clinical trial related expenses of $2.8 million, partially offset by a $0.5 millionincrease in consulting fees.
- General and Administrative (G&A): G&A expenses were
$5.2 millionfor the second quarter of 2020, compared with $2.4 millionfor the second quarter of 2019. The increase of $2.8 millionwas primarily due to a $1.5 millionincrease in legal expenses due to the proposed RareGen acquisition, intellectual property, and litigation related expenses, and other general increases in salaries, consulting fees, audit and tax services and recruiting expenses.
- Interest Income: Interest income was
$12,000for the second quarter of 2020, compared with $220,000 for the second quarter of 2019, primarily due to lower interest rates in 2020 compared with 2019 and to a lesser extent, a decrease in cash balances held in interest bearing accounts during 2020 compared with 2019.
- Interest Expense: Interest expense was
$211,000for the second quarter of 2020, compared with $254,000for the second quarter of 2019, primarily due to lower levels of debt during the second quarter of 2020 compared with the second quarter of 2019.
- Net Loss: Net loss was
$13.9 millionfor the second quarter of 2020, compared with $5.9 millionfor the second quarter of 2019. The increase of $8.0 millionwas primarily due to zero revenue and cost of revenue recognized during the second quarter of 2020 compared with $8.1 millionof revenue and $0.8 millioncost of revenue during the second quarter of 2019. Additionally, an increase in general and administrative expenses was partially offset by a decrease in research and development expenses during the second quarter of 2020 compared with the second quarter of 2019.
- Cash Position and Shares Outstanding: As of June 30, 2020, cash and cash equivalents totaled $23.6 million and there were 28.4 million shares outstanding. On
July 2, 2020, the Company completed an underwritten public offering of 9.375 million shares at a price of $8.00per share, resulting in gross proceeds of $75.0 millionand net proceeds of approximately $69.8 millionafter deducting underwriting discounts and commissions and other offering expenses.
Webcast and Conference Call
The Company will host a webcast and conference call at
Liquidia is a late-stage clinical biopharmaceutical company focused on the development and commercialization of novel products using its proprietary PRINT® technology to transform the lives of patients. PRINT is a particle engineering platform that enables precise production of uniform drug particles designed to improve the safety, efficacy and performance of a wide range of therapies. Currently, Liquidia is focused on the development of two product candidates for which it holds worldwide commercial rights: LIQ861 for the treatment of pulmonary arterial hypertension (PAH) and LIQ865 for the treatment of local post-operative pain. Liquidia is headquartered in Research Triangle Park, NC. For more information, please visit www.liquidia.com.
RareGen is a portfolio company of
Important Information About the Transaction and Where to Find It
In connection with the proposed merger transaction, the Company and
Participants in the Solicitation
The Company, RareGen and certain of their respective directors, executive officers and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction and related matters. Information regarding the Company’s directors and executive officers, including a description of their direct interests, by security holdings or otherwise, is contained in the Company’s Form 10-K for the year ended December 31, 2019 and its proxy statement filed on April 28, 2020, which are filed with the SEC. Additional information is and will be available in the registration statement on Form S-4 and the proxy statement/prospectus.
No Offer or Solicitation
This communication is not intended to and shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote of approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
Cautionary Statements Regarding Forward-Looking Statements
This press release may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical facts, including statements regarding our future results of operations and financial position, our strategic and financial initiatives, our business strategy and plans and our objectives for future operations, are forward-looking statements. Such forward-looking statements, including statements regarding clinical trials, clinical studies and other clinical work (including the funding therefor, anticipated patient enrollment, safety data, study data, trial outcomes, timing or associated costs), regulatory applications and related timelines, including potential U.S. Food and Drug Administration (FDA) approval of the New Drug Application (NDA) for LIQ861, the timeline or outcome related to our patent litigation pending in the
Vice President, Corporate Development and Strategy
-Financial Tables Follow-
|Prepaid expenses and other current assets||750,023||590,251|
|Total current assets||24,336,465||56,386,629|
|Property, plant and equipment, net||7,976,411||9,253,965|
|Operating lease right-of-use assets, net||2,743,600||2,823,430|
|Prepaid expenses and other assets||378,043||378,043|
|Liabilities and stockholders’ equity|
|Accrued stock offering expenses||65,000||1,289,413|
|Other accrued expenses||1,068,276||1,525,919|
|Current portion of operating lease liabilities||614,083||566,390|
|Current portion of finance lease liabilities||1,336,833||1,244,229|
|Current portion of long-term debt||5,585,636||5,585,637|
|Total current liabilities||13,331,428||16,874,318|
|Long-term operating lease liabilities||5,350,198||5,670,971|
|Long-term finance lease liabilities||378,547||1,056,747|
|Commitments and contingencies|
|Common stock —
|Additional paid-in capital||252,788,245||250,158,766|
|Total stockholders’ equity||8,869,589||34,947,547|
|Total liabilities and stockholders’ equity||$||35,434,519||$||68,842,067|
|Three Months Ended||Six Months Ended|
|Costs and expenses:|
|Cost of revenue||—||807,192||—||807,192|
|Research and development||8,490,418||10,723,591||19,313,342||21,387,894|
|General and administrative||5,226,264||2,408,651||9,049,460||5,430,233|
|Total costs and expenses||13,716,682||13,939,434||28,362,802||27,625,319|
|Loss from operations||(13,716,682||)||(5,867,314||)||(28,362,802||)||(19,553,199||)|
|Other income (expense):|
|Total other expense, net||(199,419||)||(33,851||)||(344,778||)||(114,756||)|
|Other comprehensive income (loss)||—||—||—||—|
|Net loss per common share:|
|Weighted average common shares outstanding:|
Source: Liquidia Technologies, Inc.