Intercept Pharmaceuticals Reports First Quarter 2021 Financial Results and Provides Business Update
Worldwide Ocaliva® net sales of
Company narrows 2021 financial guidance; now expects worldwide Ocaliva net sales guidance of $325 million to $340 million and reiterates Non-GAAP adjusted operating expense guidance of
Process between Intercept and FDA remains ongoing regarding updates to the Ocaliva
Intercept continues to work toward potential resubmission of OCA in NASH fibrosis in the
Company to host conference call today at 8:30 a.m. ET
“Our global commercial strategy and our continued progress in educating specialists including gastroenterologists have produced another quarter of double-digit sales growth for Ocaliva,” said
“We are currently preparing for a NASH safety update from the ongoing Phase 3 REGENERATE study that will reflect more than twice the patient exposure to OCA relative to our first submission. We are also planning to generate additional data pursuant to upcoming discussions with the agency. While we are making progress, significant work remains and alignment with FDA on the necessary elements will be a key dependency for a potential resubmission in support of accelerated approval. So at this time we cannot reiterate our potential filing timing for this year and expect to provide an update in the third quarter of this year,” Durso continued. “We have also formally received a 6-month clock stop of the review of OCA for development of NASH fibrosis in the EU in order to allow us to focus on executing on the feedback we have received. Additionally, our Phase 3 REVERSE study in NASH patients with compensated cirrhosis is ongoing and we expect to have top-line data by end-of-year, and we continue to make progress on our pipeline programs including our combination program with bezafibrate.”
Program Highlights
Primary Biliary Cholangitis
- Process with FDA regarding updates to the
U.S. Prescribing Information is nearing completion. Final label will restrict Ocaliva in patients with decompensated cirrhosis and in a subset of patients with compensated cirrhosis. - Discussion remains ongoing with FDA and EMA regarding the COBALT post-marketing trial.
NASH
- Held multiple formal interactions with FDA regarding our NASH fibrosis development program and are preparing for a safety update that will reflect a doubling of patient exposure to OCA relative to our first submission. We are also gathering data that will be the subject of upcoming interactions.
- The REVERSE Phase 3 study in patients with compensated cirrhosis due to NASH remains ongoing and a top-line readout is expected to be available by the end of 2021.
- We have formally received a 6-month clock stop of the review of OCA for development of NASH fibrosis in the EU to allow us to focus on executing on the feedback we have received and the data we are developing for potential
U.S. resubmission.
Additional Pipeline
- The Company continues to enroll the OCA/bezafibrate combination trial outside the
U.S. and will provide updates when enrollment is complete. Intercept now has an open IND for the combination in theU.S. - Intercept intends to initiate first-in-human work with INT-787 in 2021.
Financial Results
Revenue
- We recognized $81.7 million in total revenue in the first quarter of 2021, as compared to $72.7 million in total revenue in the prior year quarter. Ocaliva net sales in the first quarter of 2021 were comprised of
U.S. net sales of $57.3 million and ex-U.S. net sales of $24.4 million, as compared toU.S. net sales of $50.8 million and ex-U.S. net sales of $21.9 million in the prior year quarter.
Operating Expenses
- In the quarters ended
March 31, 2021 and 2020, we recorded$111.0 million and$156.1 million , respectively, in total operating expenses and$101.7 million and$142.9 million , respectively, in non-GAAP adjusted operating expenses, which excludes non-cash stock-based compensation expense of$8.4 million and$12.5 million , respectively, and depreciation expense of$0.9 million and$0.8 million , respectively. - References in this press release to “non-GAAP adjusted operating expenses” mean our total operating expenses, as calculated and presented in accordance with
U.S. Generally Accepted Accounting Principles (“GAAP”), adjusted for the effects of two non-cash items: stock-based compensation and depreciation. See “Non-GAAP Financial Measures” below. A reconciliation of non-GAAP adjusted operating expenses to total operating expenses for all historical periods presented is included below under the heading “Reconciliation of Non-GAAP Adjusted Operating Expenses to Total Operating Expenses.”
Cost of Sales
- Our cost of sales was
$0.8 million in the first quarter of 2021, as compared to$0.9 million in the prior year quarter. Our cost of sales for the quarters endedMarch 31, 2021 and 2020 consisted primarily of packaging, labeling, materials and related expenses.
Sales, General & Administrative Expenses
- Our selling, general and administrative expenses were
$59.3 million in the first quarter of 2021, down from$98.6 million in the prior year quarter. The decrease was primarily driven by actions taken to decrease expenses relating to our launch preparation activities associated with the potential approval and commercialization of OCA for liver fibrosis due to NASH following the complete response letter in 2020.
Research & Development Expenses
- Our research and development expenses decreased to
$50.8 million in the first quarter of 2021, down from$56.7 million in the prior year quarter. The decrease was primarily driven by lower NASH and Ocaliva API development costs.
Interest Expense
- Interest expense in the quarters ended March 31, 2021 and 2020 was $12.4 million and $11.8 million, respectively. For the three months ended
March 31, 2021 and 2020, interest expense related to the$230.0 million aggregate principal amount of 2.00% Convertible Senior Notes due 2026 (the “2026 Convertible Notes”) that we issued inMay 2019 and the$460.0 million aggregate principal amount of 3.25% Convertible Senior Notes due 2023 (the “2023 Convertible Notes” and together with the 2026 Convertible Notes, the “Convertible Notes”) that we issued inJuly 2016 .
Net Loss
- In the first quarter of 2021 we reported a net loss of
$40.4 million , a decrease compared to a net loss of$93.0 million in the first quarter 2020.
Cash Position
- As of
March 31, 2021 , we had cash, cash equivalents, restricted cash, and investment debt securities available for sale of approximately$418.6 million . As ofDecember 31, 2020 , we had cash, cash equivalents, restricted cash, and investment debt securities available for sale of approximately$477.2 million .
2021 Financial Guidance
As a result of the latest dialogue with the FDA, which we expect to result in a label update restricting the use of Ocaliva in patients with decompensated cirrhosis and in a subset of patients with compensated cirrhosis, we are narrowing our Ocaliva net sales guidance range.
We now expect full year 2021 worldwide Ocaliva net sales to be between $325 million to $340 million. Once the label is finalized and as we monitor post-label update market dynamics, we will plan to refine this range throughout the year as necessary.
We are reiterating our full year 2021 non-GAAP adjusted operating expenses to be between $380 million to $410 million.
See “Non-GAAP Financial Measures” below. A quantitative reconciliation of projected non-GAAP adjusted operating expenses to total operating expenses is not available without unreasonable effort primarily due to our inability to predict with reasonable certainty the amount of future stock-based compensation expense.
Conference Call on
We are hosting our first quarter 2021 financial results conference call and webcast on
About Intercept
Intercept is a biopharmaceutical company focused on the development and commercialization of novel therapeutics to treat progressive non-viral liver diseases, including primary biliary cholangitis (PBC) and nonalcoholic steatohepatitis (NASH). Founded in 2002 in
Non-GAAP Financial Measures
This press release presents non-GAAP adjusted operating expenses on a historical and projected basis. For the periods presented, non-GAAP adjusted operating expenses exclude from total operating expenses, as calculated and presented in accordance with GAAP, the effects of two non-cash items: stock-based compensation and depreciation. Non-GAAP adjusted operating expenses is a financial measure that has not been prepared in accordance with GAAP. Accordingly, investors should consider non-GAAP adjusted operating expenses in addition to, but not as a substitute for, total operating expenses that we calculate and present in accordance with GAAP. Among other things, our management uses non-GAAP adjusted operating expenses to establish budgets and operational goals and to manage our business. Other companies may define or use this measure in different ways. We believe that the presentation of non-GAAP adjusted operating expenses provides investors and management with helpful supplemental information relating to operating performance and trends. A table reconciling non-GAAP adjusted operating expenses to total operating expenses for all historical periods presented is included below under the heading “Reconciliation of Non-GAAP Adjusted Operating Expenses to Total Operating Expenses”. A quantitative reconciliation of projected non-GAAP adjusted operating expenses to total operating expenses is not available without unreasonable effort primarily due to our inability to predict with reasonable certainty the amount of future stock-based compensation expense.
About Liver Fibrosis due to NASH
Nonalcoholic steatohepatitis (NASH) is a serious progressive liver disease caused by excessive fat accumulation in the liver that induces chronic inflammation, resulting in progressive fibrosis (scarring) that can lead to cirrhosis, eventual liver failure, cancer and death. Advanced fibrosis is associated with a substantially higher risk of liver-related morbidity and mortality in patients with NASH. In
About the REGENERATE Study
REGENERATE is a Phase 3, randomized, double-blind, placebo-controlled, multicenter study assessing the safety and efficacy of obeticholic acid (OCA) on clinical outcomes in patients with liver fibrosis due to NASH. A pre-specified 18-month analysis was conducted to assess the effect of OCA on liver histology comparing month 18 biopsies with baseline. REGENERATE has completed target enrollment for the clinical outcomes cohort, with 2,480 adult NASH patients randomized at over 300 qualified centers worldwide, and is expected to continue through clinical outcomes for verification and description of clinical benefit. The end-of-study analysis will evaluate the effect of OCA on all-cause mortality and liver-related clinical outcomes, as well as long-term safety.
About Ocaliva® (obeticholic acid)
Ocaliva is indicated in
This indication is approved under the accelerated approval pathway based on a reduction in alkaline phosphatase (ALP) as a surrogate endpoint which is reasonably likely to predict clinical benefit, including an improvement in liver transplant free-survival. An improvement in survival or disease-related symptoms has not been established. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials. We are conducting a Phase 4 clinical outcomes trial, which we refer to as our COBALT trial, of OCA in patients with PBC with the goal of confirming clinical benefit on a post-marketing basis.
In
WARNING: HEPATIC DECOMPENSATION AND FAILURE IN INCORRECTLY DOSED PBC PATIENTS WITH CHILD-PUGH CLASS B OR
- In postmarketing reports, hepatic decompensation and failure, in some cases fatal, have been reported in patients with Primary Biliary Cholangitis (PBC) with decompensated cirrhosis or Child-
Pugh Class B or C hepatic impairment when OCALIVA was dosed more frequently than recommended. - The recommended starting dosage of OCALIVA is 5 mg once weekly for patients with Child-
Pugh Class B or C hepatic impairment or a prior decompensation event.
Contraindications
OCALIVA is contraindicated in PBC patients with complete biliary obstruction.
Warnings and Precautions
Hepatic Decompensation and Failure in Incorrectly-Dosed PBC Patients with Child-
In postmarketing reports, hepatic decompensation and failure, in some cases fatal, have been reported in PBC patients with decompensated cirrhosis or Child-Pugh B or C hepatic impairment when OCALIVA was dosed more frequently than the recommended starting dosage of 5 mg once weekly. Reported cases typically occurred within 2 to 5 weeks after starting OCALIVA and were characterized by an acute increase in total bilirubin and/or ALP concentrations in association with clinical signs and symptoms of hepatic decompensation (e.g., ascites, jaundice, gastrointestinal bleeding, worsening of hepatic encephalopathy).
Routinely monitor patients for progression of PBC disease, including liver-related complications, with laboratory and clinical assessments. Dosage adjustment, interruption or discontinuation may be required. Close monitoring is recommended for patients at an increased risk of hepatic decompensation. Severe intercurrent illnesses that may worsen renal function or cause dehydration (e.g., gastroenteritis), may exacerbate the risk of hepatic decompensation. Interrupt treatment with OCALIVA in patients with laboratory or clinical evidence of worsening liver function indicating risk of decompensation, and monitor the patient’s liver function. Consider discontinuing OCALIVA in patients who have experienced clinically significant liver-related adverse reactions. Discontinue OCALIVA in patients who develop complete biliary obstruction.
Liver-Related Adverse Reactions
Dose-related, liver-related adverse reactions including jaundice, worsening ascites and primary biliary cholangitis flare have been observed in clinical trials, as early as one month after starting treatment with OCALIVA 10 mg once daily up to 50 mg once daily (up to 5-times the highest recommended dosage). Monitor PBC patients during treatment with OCALIVA for elevations in liver biochemical tests and for the development of liver-related adverse reactions.
Severe Pruritus
Severe pruritus was reported in 23% of PBC patients in the OCALIVA 10 mg arm, 19% of PBC patients in the OCALIVA titration arm, and 7% of PBC patients in the placebo arm in a 12-month double-blind randomized controlled trial of 216 PBC patients. Severe pruritus was defined as intense or widespread itching, interfering with activities of daily living, or causing severe sleep disturbance, or intolerable discomfort, and typically requiring medical interventions. Consider clinical evaluation of PBC patients with new onset or worsening severe pruritus. Management strategies include the addition of bile acid resins or antihistamines, OCALIVA dosage reduction, and/or temporary interruption of OCALIVA dosing.
Reduction in HDL-C
Patients with PBC generally exhibit hyperlipidemia characterized by a significant elevation in total cholesterol primarily due to increased levels of high-density lipoprotein-cholesterol (HDL-C). Dose-dependent reductions from baseline in mean HDL-C levels were observed at 2 weeks in OCALIVA-treated PBC patients, 20% and 9% in the 10 mg and titration arms, respectively, compared to 2% in the placebo arm. Monitor PBC patients for changes in serum lipid levels during treatment. For PBC patients who do not respond to OCALIVA after 1 year at the highest recommended dosage that can be tolerated (maximum of 10 mg once daily), and who experience a reduction in HDL-C, weigh the potential risks against the benefits of continuing treatment.
Adverse Reactions
The most common adverse reactions from subjects taking OCALIVA for PBC were pruritus, fatigue, abdominal pain and discomfort, rash, oropharyngeal pain, dizziness, constipation, arthralgia, thyroid function abnormality, and eczema.
Drug Interactions
Bile Acid Binding Resins
Bile acid binding resins such as cholestyramine, colestipol, or colesevelam adsorb and reduce bile acid absorption and may reduce the absorption, systemic exposure, and efficacy of OCALIVA. If taking a bile acid binding resin, take OCALIVA at least 4 hours before or 4 hours after taking the bile acid binding resin, or at as great an interval as possible.
Warfarin
The International Normalized Ratio (INR) decreased following coadministration of warfarin and OCALIVA. Monitor INR and adjust the dose of warfarin, as needed, to maintain the target INR range when coadministering OCALIVA and warfarin.
CYP1A2 Substrates with Narrow Therapeutic Index
Obeticholic acid, the active ingredient in OCALIVA, may increase the exposure to concomitant drugs that are CYP1A2 substrates. Therapeutic monitoring of CYP1A2 substrates with a narrow therapeutic index (e.g. theophylline and tizanidine) is recommended when coadministered with OCALIVA.
Inhibitors of Bile Salt Efflux Pump
Avoid concomitant use of inhibitors of the bile salt efflux pump (BSEP) such as cyclosporine. Concomitant medications that inhibit canalicular membrane bile acid transporters such as the BSEP may exacerbate accumulation of conjugated bile salts including taurine conjugate of obeticholic acid in the liver and result in clinical symptoms. If concomitant use is deemed necessary, monitor serum transaminases and bilirubin.
Please see Full Prescribing Information, including Boxed WARNING and Medication Guide for OCALIVA.
To report SUSPECTED ADVERSE REACTIONS, contact
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements, including, but not limited to, statements regarding the progress, timing and results of our clinical trials, including our clinical trials for the treatment of nonalcoholic steatohepatitis (“NASH”), the safety and efficacy of our approved product, Ocaliva (obeticholic acid or “OCA”) for primary biliary cholangitis (“PBC”), and our product candidates, including OCA for liver fibrosis due to NASH, the timing and acceptance of our regulatory filings and the potential approval of OCA for liver fibrosis due to NASH, the review of our New Drug Application for OCA for the treatment of liver fibrosis due to NASH by the
These statements constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “possible,” “continue” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release, and we undertake no obligation to update any forward-looking statement except as required by law. These forward-looking statements are based on estimates and assumptions by our management that, although believed to be reasonable, are inherently uncertain and subject to a number of risks. The following represent some, but not necessarily all, of the factors that could cause actual results to differ materially from historical results or those anticipated or predicted by our forward-looking statements: our ability to successfully commercialize Ocaliva for PBC; our ability to maintain our regulatory approval of Ocaliva for PBC in the United States, Europe, Canada, Israel, Australia and other jurisdictions in which we have or may receive marketing authorization; our ability to timely and cost-effectively file for and obtain regulatory approval of our product candidates on an accelerated basis or at all, including OCA for liver fibrosis due to NASH following the issuance of the CRL by the FDA; any advisory committee recommendation or dispute resolution determination that our product candidates, including OCA for liver fibrosis due to NASH, should not be approved or approved only under certain conditions; any future determination that the regulatory applications and subsequent information we submit for our product candidates, including OCA for liver fibrosis due to NASH, do not contain adequate clinical or other data or meet applicable regulatory requirements for approval; conditions that may be imposed by regulatory authorities on our marketing approvals for our products and product candidates, including OCA for liver fibrosis due to NASH, such as the need for clinical outcomes data (and not just results based on achievement of a surrogate endpoint), any risk mitigation programs such as a REMS, and any related restrictions, limitations and/or warnings contained in the label of any of our products or product candidates; any potential side effects associated with Ocaliva for PBC, OCA for liver fibrosis due to NASH or our other product candidates that could delay or prevent approval, require that an approved product be taken off the market, require the inclusion of safety warnings or precautions, or otherwise limit the sale of such product or product candidate, including in connection with the newly identified safety signal relating to Ocaliva identified by the FDA in
Contact
For more information about Intercept, please contact:
Caileigh Dougherty
investors@interceptpharma.com
media@interceptpharma.com
Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except per share data) |
|||||||
| Three Months Ended |
|||||||
| 2021 | 2020 | ||||||
| Revenue: | |||||||
| Product revenue, net | $ | 81,661 | $ | 72,652 | |||
| Total revenue | 81,661 | 72,652 | |||||
| Operating expenses: | |||||||
| Cost of sales | 810 | 852 | |||||
| Selling, general and administrative | 59,271 | 98,558 | |||||
| Research and development | 50,766 | 56,687 | |||||
| Restructuring | 161 | - | |||||
| Total operating expenses | 111,008 | 156,097 | |||||
| Operating loss | (29,347 | ) | (83,445 | ) | |||
| Other income (expense): | |||||||
| Interest expense | (12,419 | ) | (11,777 | ) | |||
| Other income, net | 1,346 | 2,239 | |||||
| Total other (expense), net | (11,073 | ) | (9,538 | ) | |||
| Net loss | $ | (40,420 | ) | $ | (92,983 | ) | |
| Net loss per common and potential common share: | |||||||
| Basic and diluted | $ | (1.22 | ) | $ | (2.86 | ) | |
| Weighted average common and potential common shares outstanding: | |||||||
| Basic and diluted | 33,139 | 32,561 | |||||
| Condensed Consolidated Balance Sheet Information (In thousands) |
|||||||
2021 |
2020 (1) |
||||||
| (Unaudited) |
|||||||
| Cash, cash equivalents, restricted cash and investment debt securities, available for sale | $ | 418,616 | $ | 477,170 | |||
| Total assets | $ | 520,111 | $ | 580,489 | |||
| Total liabilities (2) | $ | 720,109 | $ | 747,342 | |||
| Stockholders’ (deficit) equity | $ | (199,998 | ) | $ | (166,853 | ) | |
_____________
(1) Derived from the audited financial statements included in Intercept's Annual Report on Form 10-K for the year ended
(2) Includes
| Reconciliation of Non-GAAP Adjusted Operating Expenses to Total Operating Expenses (Unaudited) (In thousands) |
|||||||
| Three Months Ended |
|||||||
| 2021 |
2020 |
||||||
| Total operating expenses | $ | 111,008 | $ | 156,097 | |||
| Adjustments: | |||||||
| Stock-based compensation | 8,419 | 12,473 | |||||
| Depreciation | 870 | 764 | |||||
| Non-GAAP adjusted operating expenses | $ | 101,719 | $ | 142,860 | |||
Source: Intercept Pharmaceuticals, Inc.