Cytokinetics, Incorporated Reports Second Quarter 2008 Financial Results
"The second quarter showcased continuing progress in our cardiovascular program with the announcement of statistically significant data from an ongoing clinical trial of CK-1827452 in stable heart failure patients. These promising data reflect what we believe is the clinically relevant activity of this novel drug candidate," stated Robert I. Blum, President and Chief Executive Officer. "In addition, we are sharpening our focus to areas in which we believe we have competitive advantage. We have leveraged the expertise and capabilities in muscle contractility gained through our focus on cardiac muscle activators to identify novel modulators of skeletal and smooth muscle. During the second quarter, we announced the selection of a development compound that represents a potentially novel therapeutic approach to activating skeletal muscle. This and other compounds arising from our programs directed to muscle biology may form a cornerstone to the company's expanding pipeline and allow us to develop novel drugs targeting an array of potential clinical indications."
Company Highlights
Cardiovascular
-- In June, as part of the Late Breaking Trials Session at the 2008 Heart
Failure Congress of the European Society of Cardiology in Milan, Italy,
Cytokinetics announced results from an interim analysis of an ongoing Phase
IIa clinical trial evaluating CK-1827452 administered intravenously to
patients with stable heart failure. The safety data from this analysis
suggest that CK-1827452 was well-tolerated with no serious adverse events
reported in patients exposed to the intended range of doses and plasma
concentrations. A pharmacodynamic-pharmacokinetic analysis of data from 22
patients showed that when compared to placebo, CK-1827452 produced
statistically significant and clinically relevant increases in Doppler-
derived stroke volume and fractional shortening as a consequence of
statistically significant prolongations of systolic ejection time.
Cytokinetics continues to enroll patients in the fourth cohort of this
trial.
-- Cytokinetics recently completed enrollment of the first cohort of
patients in a Phase IIa trial designed to evaluate the safety and
tolerability of both an intravenous and an oral formulation of CK-1827452
in patients with ischemic cardiomyopathy and angina. Cytokinetics is
conducting an interim safety analysis of clinical data arising from the
first cohort in order to enable the initiation of the second and final
cohort.
-- Cytokinetics continues to screen patients for the potential initiation
of an open-label, non-randomized Phase IIa clinical trial designed to
evaluate an intravenous formulation of CK-1827452 administered to patients
with stable heart failure undergoing clinically indicated coronary
angiography in a cardiac catheterization laboratory.
-- During the quarter, Cytokinetics announced an update to an ongoing
Phase I clinical trial of CK-1827452 to evaluate the potential for drug-
drug interactions occurring via each of two drug-metabolizing enzymes.
Cytokinetics continues to screen and enroll subjects in this trial.
-- In the second quarter, Cytokinetics provided results from two
completed Phase I clinical trials of CK-1827452. Final results of the
single-dose to multi-dose oral formulation trial showed CK-1827452 was well-
tolerated with no drug-related serious adverse events and with dose-
proportionality between the two dose levels studied. The second trial
assessed three modified release formulations of CK-1827452; a formulation
which reduced the peak and raised the trough plasma concentrations of this
drug candidate without a substantial effect on overall bioavailability, as
compared to an immediate release formulation, has been selected for further
clinical testing.
Oncology
-- In June, at the Annual Meeting of the American Society of Clinical
Oncology (ASCO), in Chicago Illinois, Cytokinetics announced interim data
from the Phase I portion of the ongoing Phase I/II clinical trial of
ispinesib, a novel kinesin spindle protein (KSP) inhibitor, administered as
monotherapy as a first-line treatment in chemotherapy-naive patients with
locally advanced or metastatic breast cancer. The authors concluded that
preliminary data suggest that ispinesib is well-tolerated when dosed on
days 1 and 15 every 28 days at doses up to 12 mg/m2. Cytokinetics continues
to enroll patients and dose-escalate in the Phase I portion of this trial.
-- Also at ASCO, the National Cancer Institute presented final data from
a Phase I clinical trial designed to evaluate the safety, tolerability,
pharmacodynamics, and pharmacokinetic profile of ispinesib as monotherapy
administered to pediatric patients with relapsed or refractory solid
tumors. The authors concluded that the maximum tolerated dose (MTD) on this
schedule for this patient population was 9 mg/m2. The best response
observed was stable disease at 7 courses. Three patients experienced stable
disease for longer than 3 courses of therapy. The authors concluded that
ispinesib was well-tolerated in pediatric patients, with neutropenia and
hepatotoxicity representing the most commonly observed dose-limiting
toxicities (DLTs).
-- In June, in association with proceedings at both ASCO and the 10th
International Conference on Malignant Lymphoma in Lugano, Switzerland,
interim data from the Phase I portion of a Phase I/II clinical trial of SB-
743921, a novel KSP inhibitor, in patients with Hodgkin or non-Hodgkin
lymphoma were presented. The authors concluded that the pattern of
neutropenia onset and recovery support a dosing schedule for SB-743921 of
days 1 and 15 of a 28-day cycle. This represents a greater dose density
(0.43 mg/m2/day) than on the previously studied dosing regimen of 4 mg/m2
or 0.19 mg/m2/day every 3 weeks. The only DLT observed without granulocyte
colony-stimulating factor (G-CSF) was neutropenia; therefore, further dose
escalation with empiric, prophylactic G-CSF is ongoing. To date, one
objective partial response has been observed at the MTD without G-CSF in a
patient with Hodgkin lymphoma.
-- Also in June, Cytokinetics announced the results of a Phase Ib
clinical trial sponsored by GlaxoSmithKline (GSK) designed to evaluate
ispinesib in combination with capecitabine, an oral chemotherapy agent
commonly used in the treatment of breast cancer. The investigators in this
clinical trial concluded that the combination of ispinesib with
capecitabine had an acceptable tolerability profile on the 21-day schedule
investigated in the trial. The DLTs in this combination regimen were
consistent with the monotherapy toxicities of ispinesib (prolonged
neutropenia) and capecitabine (rash). In this trial, the best response
observed among the 24 patients treated was a partial response in a patient
with advanced breast cancer. In addition, 11 patients had a response of
stable disease.
-- During the quarter, GSK continued to enroll and dose-escalate patients
in the ongoing first-time-in-humans clinical trial of GSK-923295, a novel
inhibitor of centromere-associated protein E (CENP-E). This open-label,
non-randomized, dose-finding Phase I trial is designed to investigate the
safety, tolerability, pharmacodynamics and pharmacokinetic profile of GSK-
923295 in patients with advanced solid tumors. An oral presentation at the
2008 American Association of Cancer Research (AACR) Annual Meeting held in
San Diego, California highlighted interim clinical data from this trial.
Research
-- During the quarter, Cytokinetics announced the selection of a
development compound that is an activator of the skeletal sarcomere. This
compound has demonstrated encouraging pharmacological activity in non-
clinical models suggesting that it could be developed as a potential
treatment for skeletal muscle weakness associated with neuromuscular
diseases or other conditions. This compound is the fifth development
compound to emerge from Cytokinetics' research activities focused on
discovering novel therapeutics directed towards cytoskeletal biology.
-- In the second quarter, Cytokinetics advanced novel smooth muscle
myosin inhibitors in lead optimization activities towards the potential
selection of one or more development compounds. Company scientists have
characterized compounds arising from this research in pharmacology studies
and have demonstrated encouraging evidence of efficacy for an inhaled
formulation of certain of these compounds in preclinical
bronchoconstriction models related to asthma and other reactive airways
disorders.
-- In June, Cytokinetics announced that it agreed to extend the research
term under its strategic alliance with GSK to continue research activities
focused towards CENP-E.
Corporate
-- During the quarter, Cytokinetics appointed Denise Gilbert, Ph.D. to
the company's Board of Directors.
-- On July 1, 2008, Charles Homcy, M.D. resigned from the company's Board
of Directors. Dr. Homcy remains a member of the Cytokinetics' Scientific
Advisory Board and a consultant to the company.
Financials
Revenues from research and development collaborations for the second quarter of 2008 were $3.1 million, compared to $3.2 million for the same period in 2007. Revenues for the second quarter of 2008 and 2007 were primarily derived from the company's collaboration and option agreement with Amgen.
Total research and development (R&D) expenses in the second quarter of 2008 were $14.9 million, compared to $13.7 million for the same period in 2007. The increase in R&D expenses in the second quarter of 2008, compared to the same period in 2007, was primarily due to increased spending related to the company's clinical and preclinical outsourcing costs and higher laboratory and personnel expenses.
Total general and administrative (G&A) expenses for the second quarter of 2008 were $4.3 million, compared to $4.0 million for the same period in 2007. The increase in G&A expenses in the second quarter of 2008, compared to the same period in 2007, was primarily due to increased spending for outside services.
The net loss for the three months ended June 30, 2008, was $15.4 million, or $0.31 per share, compared to a net loss for the same period in 2007 of $12.6 million, or $0.27 per share.
Cytokinetics also reported results of its operations for the six months ended June 30, 2008. Revenues from research and development collaborations for the six months ended June 30, 2008 were $6.1 million, compared to revenues of $6.4 million for the same period in 2007. The decrease in collaborative research revenues for the first six months of 2008, as compared to the same period in 2007, was primarily the result of lower revenue from our collaboration and research agreement with GSK.
Total R&D expenses for the six months ended June 30, 2008 were $29.0 million, compared to $26.2 million for the same period in 2007. The increase in R&D expenses in the first six months of 2008, over the same period in 2007, was primarily due to the company's clinical and preclinical outsourcing costs and higher laboratory and personnel expenses.
Total G&A expenses for the six months ended June 30, 2008 were $8.4 million, compared to $8.5 million for the same period in 2007. The decreased spending in the first six months of 2008, over the same period in 2007, was primarily due to lower legal fees, which was partially offset by an increase in spending for outside services and personnel expenses.
The net loss for the six months ended June 30, 2008, was $29.3 million, or $0.59 per share, compared to a net loss of $24.3 million, or $0.52 per share, for the same period in 2007.
Company Milestones for 2008
Cardiovascular
CK-1827452
-- In August, Cytokinetics plans to present additional data from the
first 22 patients who completed treatment in the ongoing Phase IIa clinical
trial of CK-1827452 in stable heart failure patients at the European
Society of Cardiology 2008 Congress in Munich, Germany.
-- In September, Cytokinetics plans to present interim data from
additional patients who have completed treatment in the ongoing Phase IIa
clinical trials program of CK-1827452 in stable heart failure patients as
part of the Late Breaking Clinical Trials Session at the Annual Meeting of
the Heart Failure Society of America in Toronto, Ontario, Canada.
-- In the second half of 2008, Cytokinetics plans to initiate a Phase IIa
clinical trial designed to evaluate an intravenous formulation of CK-
1827452 administered to patients with stable heart failure undergoing
clinically indicated coronary angiography in a cardiac catheterization
laboratory. Cytokinetics anticipates data will be available from this trial
in 2009.
-- In the second half of 2008, Cytokinetics anticipates that data will be
available from the ongoing Phase IIa trial of CK-1827452 in patients with
ischemic cardiomyopathy and angina.
-- In the second half of 2008, Cytokinetics anticipates that final data
will be available from the Phase I trial of CK-1827452 evaluating the
potential for certain drug-drug interactions in healthy volunteers.
As enrollment progresses in 2008 in all of the ongoing clinical trials of CK-1827452, Cytokinetics anticipates providing updated guidance on the timing and availability of expected data.
Oncology
Ispinesib (SB-715992)
-- In September, Cytokinetics plans to present data from the ongoing Phase I portion of its open-label, non-randomized Phase I/II clinical trial designed to evaluate ispinesib as monotherapy administered as a first-line treatment for chemotherapy-naive patients with locally advanced or metastatic breast cancer at ASCO's 2008 Breast Cancer Symposium in Washington, D C.
SB-743921
-- In the second half of 2008, Cytokinetics anticipates final data will be available from the Phase I portion of its ongoing Phase I/II clinical trial of SB-743921 as a potential treatment of patients with Hodgkin or non- Hodgkin lymphoma.
GSK-923295
-- In October, GSK plans to present data from its Phase I clinical trial of GSK-923295 in advanced solid tumors at the EORTC-NCI-AACR International Conference in Geneva, Switzerland.
As enrollment progresses in 2008 in all of our clinical trials in oncology, Cytokinetics anticipates providing updated guidance on the timing and availability of expected data.
Corporate
-- In the second half of 2008, Cytokinetics anticipates providing the required clinical data from its CK-1827452 Phase IIa clinical trials program to Amgen in order to inform the potential exercise of Amgen's option under the companies' strategic alliance.
Conference Call and Webcast Information
Members of Cytokinetics' management team will review second quarter results via a webcast and conference call today at 4:30 PM Eastern Time. The webcast can be accessed in the Investor Relations section of Cytokinetics' website at www.cytokinetics.com. The live audio of the conference call is also accessible via telephone to investors, members of the news media and the general public by dialing either (866) 999-CYTK (2985) (United States and Canada) or (706) 679-3078 (International) and typing in the passcode 57547896.
An archived replay of the webcast will be available via Cytokinetics' website until August 14, 2008. The replay will also be available via telephone by dialing (800) 642-1687 (United States and Canada) or (706) 645-9291 (International) and typing in the passcode 57547896 from July 31, 2008 at 5:30 PM Eastern Time until August 14, 2008.
About Cytokinetics
Cytokinetics is a biopharmaceutical company focused on the discovery, development and commercialization of novel small molecule drugs that may address areas of significant unmet clinical needs. Cytokinetics' cardiovascular disease program is focused to cardiac myosin, a motor protein essential to cardiac muscle contraction. Cytokinetics' lead compound from this program, CK-1827452, a novel small molecule cardiac myosin activator, entered Phase II clinical trials for the treatment of heart failure in 2007. Under a strategic alliance established in 2006, Cytokinetics and Amgen Inc. are performing joint research focused on identifying and characterizing activators of cardiac myosin as back-up and follow-on potential drug candidates to CK-1827452. Amgen has obtained an option for an exclusive license to develop and commercialize CK-1827452, subject to Cytokinetics' development and commercial participation rights. Cytokinetics' cancer program is focused on mitotic kinesins, a family of motor proteins essential to cell division. Under a strategic alliance established in 2001, Cytokinetics and GlaxoSmithKline (GSK) are conducting research and development activities focused on the potential treatment of cancer. Cytokinetics is developing two novel drug candidates that have arisen from this program, ispinesib and SB-743921, each a novel inhibitor of kinesin spindle protein (KSP), a mitotic kinesin. Cytokinetics is sponsoring a Phase I/II clinical trial of ispinesib as monotherapy as a first-line treatment in chemotherapy-naive patients with locally advanced or metastatic breast cancer. In addition, Cytokinetics is conducting a Phase I/II trial of SB-743921 in patients with non-Hodgkin and Hodgkin lymphomas. GSK has obtained an option for the joint development and commercialization of ispinesib and SB-743921. Cytokinetics and GSK are conducting collaborative research activities directed to the mitotic kinesin centromere-associated protein E (CENP-E). GSK-923295, a CENP-E inhibitor, is being developed under the strategic alliance by GSK; GSK began a Phase I clinical trial with GSK-923295 in 2007. In April 2008, Cytokinetics announced the selection of a potential drug candidate directed towards skeletal muscle contractility which may be developed as a potential treatment for skeletal muscle weakness associated with neuromuscular diseases or other conditions. All of these drug candidates and potential drug candidates have arisen from Cytokinetics' research activities and are directed towards the cytoskeleton. The cytoskeleton is a complex biological infrastructure that plays a fundamental role within every human cell. Additional information about Cytokinetics can be obtained at www.cytokinetics.com.
This press release contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the "Act"). Cytokinetics disclaims any intent or obligation to update these forward-looking statements, and claims the protection of the Safe Harbor for forward-looking statements contained in the Act. Examples of such statements include, but are not limited to, statements relating to Cytokinetics' and its partners' research and development activities, including the initiation, conduct, design, focus, scope, enrollment, progress and results of Cytokinetics' and its partners' planned research and development activities, including clinical trials and the anticipated timing for the announcement, presentation or availability of data from clinical trials; Cytokinetics' provision to Amgen of clinical data to inform Amgen's potential exercise of its option under the companies' collaboration and option agreement; and the potential benefits of Cytokinetics' drug candidates and potential drug candidates. Such statements are based on management's current expectations, but actual results may differ materially due to various risks and uncertainties, including, but not limited to, potential difficulties or delays in the development, testing, regulatory approval or production of Cytokinetics' drug candidates that could slow or prevent clinical development, product approval, including risks that current and past results of clinical trials or preclinical studies may not be indicative of future clinical trials results, patient enrollment for clinical trials may be difficult or delayed, Cytokinetics' drug candidates may have adverse side effects or inadequate therapeutic efficacy, the U.S. Food and Drug Administration or foreign regulatory agencies may delay or limit Cytokinetics' or its partners' ability to conduct clinical trials, and Cytokinetics may be unable to obtain or maintain patent or trade secret protection for its intellectual property; GSK may decide to postpone or discontinue development activities for GSK-923295, Cytokinetics may incur unanticipated research and development and other costs or be unable to obtain additional financing necessary to conduct development of its products, standards of care may change, others may introduce products or alternative therapies for the treatment of indications Cytokinetics' drug candidates and potential drug candidates may target, and risks and uncertainties relating to the timing and receipt of payments from our partners, including milestones and royalties on future potential product sales under Cytokinetics' collaboration agreements with such partners. For further information regarding these and other risks related to Cytokinetics' business, investors should consult Cytokinetics' filings with the Securities and Exchange Commission.
Condensed Statement of Operations
(in thousands, except share and per share data)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Revenues:
Research and development $ 16 $ 119 $ 27 $ 265
License revenues 3,058 3,058 6,117 6,117
---------- ---------- ---------- ----------
Total revenues 3,074 3,177 6,144 6,382
---------- ---------- ---------- ----------
Operating Expenses:
Research and development 14,859 13,726 28,961 26,213
General and
administrative 4,252 4,015 8,409 8,497
---------- ---------- ---------- ----------
Total operating
expenses 19,111 17,741 37,370 34,710
---------- ---------- ---------- ----------
Operating loss: (16,037) (14,564) (31,226) (28,328)
Interest and other income 808 2,122 2,249 4,363
Interest and other
expense (135) (186) (281) (356)
---------- ---------- ---------- ----------
Net loss $ (15,364) $ (12,628) $ (29,258) $ (24,321)
========== ========== ========== ==========
Net loss per common share -
basic and diluted $ (0.31) $ (0.27) $ (0.59) $ (0.52)
Weighted average shares
used in computing net loss
per common share - basic
and diluted 49,365,685 46,899,720 49,329,775 46,825,800
Condensed Balance Sheet
(in thousands)
(unaudited)
June 30, December 31,
2008 2007
------------ ------------
Assets
Cash and cash equivalents $ 86,861 $ 116,564
Short term investments - 3,175
Other current assets 2,474 2,277
------------ ------------
Total current assets 89,335 122,016
Long term investments 18,749 20,025
Property and equipment, net 6,728 7,728
Restricted investments 4,147 5,167
Other assets 407 434
------------ ------------
Total assets $ 119,366 $ 155,370
============ ============
Liabilities and stockholders' equity
Current liabilities $ 24,952 $ 26,448
Long-term obligations 21,826 29,006
Stockholders' equity 72,588 99,916
------------ ------------
Total liabilities and stockholders' equity $ 119,366 $ 155,370
============ ============
Cytokinetics, Incorporated
Christopher S. Keenan (Investors)
Director, Investor Relations
(650) 624-3000
Cytokinetics, Incorporated
Scott R. Jordan (Media)
Director, Corporate Development
(650) 624-3000
SOURCE: Cytokinetics, Inc.