Spark Therapeutics Reports 2017 Financial Results and Recent Business Progress
Feb. 20, 2018 7:30 AM
GlobeNewswire
PHILADELPHIA, Feb. 20, 2018 (GLOBE NEWSWIRE) -- Spark Therapeutics (ONCE), a fully integrated gene therapy company dedicated to challenging the inevitability of genetic disease, announced today corporate and financial results for 2017 and recent business progress.
“The landmark approval of LUXTURNA™ (voretigene neparvovec-rzyl) in December as the first gene therapy for a genetic disease in the U.S. topped another year of great progress for Spark Therapeutics,” said Jeffrey D. Marrazzo, chief executive officer of Spark Therapeutics. “We have built a fully integrated company dedicated to discovering, developing and delivering one-time treatments that provide long-lasting, transformative outcomes to patients, families, society and the health care system. In 2018, we are focused on successfully launching LUXTURNA in the U.S. and securing marketing authorization in the EU, advancing our global development program for SPK-8011 in hemophilia A and continuing to progress our pipeline of other investigational gene therapies.
“Additionally, FDA recently has granted breakthrough therapy designation to SPK-8011 for hemophilia A. It marks the third time we have been granted this designation for as many investigational gene therapies, a signal of the strength of our expertise in gene therapy,” adds Marrazzo.
12-month highlights
Received FDA approval for LUXTURNA, a one-time gene therapy product indicated for the treatment of patients with confirmed biallelic RPE65 mutation-associated retinal dystrophy who have viable retinal cells as determined by their treating physicians:
Achieved product labeling for LUXTURNA that provides a genetically based indication with a clearly described safety profile from the clinical development program
Announced novel payer and patient offerings to help ensure that appropriate patients have access to LUXTURNA
First and only FDA-approved adeno-associated virus (AAV) product in the U.S.
First and only FDA-approved AAV commercial manufacturing facility
Entered into licensing and supply agreement granting Novartis Pharmaceuticals exclusive rights to commercialize voretigene neparvovec in markets outside the U.S.
Received $105 million up front in January 2018
Eligible to receive an additional $25 million upon approval by European Medicines Agency (EMA) and total of $40 million in aggregate additional milestones on initial sales in multiple ex-U.S. markets
Receive a flat, mid-20 percent royalty on annual net sales outside the U.S.
Spark Therapeutics retains exclusive commercial rights to LUXTURNA in the U.S.
Advanced two investigational hemophilia programs with no reported serious adverse events, thrombotic events or inhibitors to date and clinically meaningful reductions in annualized bleeding rate (ABR) and annualized infusion rate (AIR)
Showed predictable clinical outcomes one-year post-infusion of investigational SPK-9001 in hemophilia B without introducing new or unforeseen risks
Published interim Phase 1/2 clinical trial data of SPK-9001 in The New England Journal of Medicine
At American Society of Hematology (ASH), released more than 13 years of cumulative follow-up data on participants in the SPK-9001 Phase 1/2 trial demonstrating a 97-percent reduction in ABR and a 99-percent reduction in AIR calculated based on data after week four, as of the Nov. 29, 2017 data cutoff
Entered into an amendment to the license agreement for SPK-9001 with Pfizer, Inc., in November 2017; including an initial $10 million cash payment and up to an additional $15 million in potential milestone payments upon completion of certain transitional activities in mid-2018
Entered into a supply agreement with Pfizer in February 2018 to begin production this quarter for one batch of drug substance expected to be used for Phase 3 development; Spark received $7 million up front and will receive up to $7 million upon delivery
Demonstrated initial human proof-of-concept for investigational SPK-8011 in hemophilia A
Presented early SPK-8011 Phase 1/2 clinical trial data at ASH for the first four participants who had been followed at least 12 weeks post infusion as of the Dec. 6, 2017 data cutoff
Reported a 100-percent reduction in ABR and 98-percent reduction in AIR calculated based on data after week four
FDA granted orphan-disease designation to SPK-8011 in January 2018
FDA granted breakthrough therapy designation to SPK-8011 in February 2018
Progressed pipeline of investigational gene therapies
Completed enrollment of five earlier-stage choroideremia participants in Phase 1/2 clinical trial for SPK-7001
Licensed a liver-directed, AAV gene therapy candidate from Genethon for Pompe disease
Bolstered human capital, technology platform and financial position:
Added Robert J. Perez, a long-time biopharmaceutical executive, to the board of directors
Received a rare pediatric disease priority review voucher in conjunction with the approval of LUXTURNA
Strong balance sheet with $540.2 million in cash, cash equivalents and marketable securities as of Dec. 31, 2017, excluding the $105 million received from Novartis in January 2018
Financial results for the year ended Dec. 31, 2017 and 2016
In the year ended Dec. 31, 2017, we recognized $12.1 million in revenue, all of which was associated with our Pfizer agreement. In the year ended Dec. 31, 2016, we recognized $20.2 million in revenue, which was all associated with our Pfizer agreement, and included a $15.0 million milestone payment that was earned in December 2016.
Research and development expenses for the year ended Dec. 31, 2017 were $135.2 million versus $86.4 million for the year ended Dec. 31, 2016. The $48.8 million increase was due to a $40.4 million increase in internal research and development expenses, due to increased effort and headcount in research, technical operations, diagnostics, quality assurance and quality control and an increase of $8.4 million in external research and development expenses, primarily driven by a $4.4 million increase in expenses related to our hemophilia A program.
Our acquired in-process research and development expense for the year ended Dec. 31, 2017 was $8.6 million, which includes additional payments related to our Selecta Bioscience, Inc. (Selecta (SELB)) license agreement entered into in 2016. Our acquired in-process research and development (IPR&D) expense for the year ended Dec. 31, 2016 was $11.1 million. This amount represents the upfront payment related to the Selecta license agreement.
During the year ended Dec. 31, 2017, we recorded a non-cash impairment charge of $15.7 million related to acquired IPR&D from a March 2016 acquisition. Additionally, we recognized an income tax benefit of $1.0 million related to the reversal of the deferred tax liability associated with the IPR&D during the year ended Dec. 31, 2017.
General and administrative expenses for the year ended Dec. 31, 2017 were $111.1 million versus $48.1 million for the year ended Dec. 31, 2016. General and administrative expenses consist primarily of salaries and related costs, including stock-based compensation, legal and patent costs and other professional fees. The $63.0 million increase primarily was due to an increase of $27.8 million in salaries and related costs, including stock-based compensation linked to increased headcount, an increase of $11.9 million in launch preparation activities for LUXTURNA, $14.7 million in legal and patent expenses, professional fees and other operating costs, and $8.6 million in facility related costs.
Our net loss for the year ended Dec. 31, 2017 was $253.5 million, or ($7.63) basic and diluted net loss per common share, as compared with a net loss of $123.7 million, or ($4.29) basic and diluted net loss per common share for the year ended Dec. 31, 2016.
As of Dec. 31, 2017, Spark had cash and cash equivalents and marketable securities of $540.2 million.
