DURECT Corporation Announces Second Quarter 2021 Financial Results and Update of Programs
DURECT Corporation (Nasdaq: DRRX) reported Q2 2021 total revenues of $2.3 million with a net loss of $9.1 million, down from $24.5 million revenue and a net income of $14.3 million in Q2 2020.
They expanded U.S. clinical sites for the Phase 2b AHFIRM study of DUR-928 for severe alcohol-associated hepatitis. Future sites are planned in the UK, Europe, and Australia. DUR-928 shows promise in treating liver conditions, with Fast Track Designation from the FDA. Additionally, POSIMIR received FDA approval for post-surgical analgesia. Cash and investments rose to $88.6 million as of June 30, 2021.
- Expansion of clinical trial sites to 26 for AHFIRM study.
- Promising DUR-928 clinical data with evidence of reducing insulin resistance and liver fibrosis biomarkers.
- FDA granted Fast Track Designation for DUR-928 in treating severe alcohol-associated hepatitis.
- POSIMIR received FDA approval for post-operative pain relief, demonstrating significant efficacy in trials.
- Cash and investments increased to $88.6 million from $56.9 million since December 2020.
- Total revenues declined significantly from $24.5 million in Q2 2020 to $2.3 million in Q2 2021.
- Net loss increased to $9.1 million from a net income of $14.3 million in the previous year, impacted by prior deferred revenue.
CUPERTINO, Calif., July 29, 2021 /PRNewswire/ -- DURECT Corporation (Nasdaq: DRRX) today announced financial results for the three months ended June 30, 2021 and provided a corporate update.
Q2 2021 Accomplishments:
We expanded the number of U.S. clinical trial sites to 26 in the Phase 2b AHFIRM clinical study of DUR-928 in severe alcohol-associated hepatitis (AH), and we are enrolling at a good rate. We have now opened about
"Executing on the AHFIRM trial to the highest level of quality and in a timely fashion is our highest priority and we are pleased with the progress made this quarter," stated James E. Brown, D.V.M, President and CEO of DURECT. "Discussions with potential POSIMIR partners are ongoing."
Financial highlights for Q2 2021:
- Total revenues were
$2.3 million and net loss was$9.1 million for the three months ended June 30, 2021 as compared to total revenues of$24.5 million and net income of$14.3 million for the three months ended June 30, 2020. Total revenues and net income for the three months ended June 30, 2020 included the recognition of$23.1 million in deferred revenue related to the termination of a license agreement during that period. - At June 30, 2021, cash and investments were
$88.6 million , compared to cash, cash held in escrow and investments of$56.9 million at December 31, 2020. Debt at June 30, 2021 was$20.4 million , compared to$20.8 million at December 31, 2020.
Update on Selected Programs:
Epigenetic Regulator Program. DUR-928, the lead product candidate in the Company's Epigenetic Regulator Program, is an endogenous, orally bioavailable, first-in-class small molecule, which may have broad applicability in acute organ injuries such as alcohol-associated hepatitis (AH) as well as in chronic liver diseases such as non-alcoholic steatohepatitis (NASH).
Clinical Development
Alcohol-associated Hepatitis (AH)
- Enrollment is ongoing in our Phase 2b study in subjects with severe acute AH to evaluate saFety and effIcacy of DUR-928 treatMent (AHFIRM). AHFIRM is a randomized, double-blind, placebo-controlled, international, multi-center Phase 2b study to evaluate the safety and efficacy of DUR-928 in approximately 300 patients with severe AH. The study is comprised of three arms targeting enrollment of approximately 100 patients each: (1) Placebo plus standard of care (SOC, which may include the use of methylprednisolone, a corticosteroid, at the discretion of the treating physician); (2) DUR-928 (30 mg); and (3) DUR-928 (90 mg). All patients in the trial receive supportive care. The primary outcome measure is 90-day survival rate for patients treated with DUR-928 compared to those treated with placebo plus SOC. The Company is targeting approximately 50 to 60 clinical trial sites in the U.S., U.K., E.U. and Australia.
- Given the high mortality rate in severe AH patients and the absence of an approved therapeutic, we believe demonstration of a robust survival benefit in the AHFIRM trial would support an NDA filing.
- Reflecting the life-threatening nature of AH and the lack of therapeutic options for this devastating condition, the FDA granted DUR-928 Fast Track Designation for the treatment of AH in December 2020.
- In March 2021, a peer-reviewed research paper describing the binding sites and proposed mechanism of action of DUR-928 was published in The Journal of Lipid Research. The publication shows that DUR-928 (referred to in the paper as 25HC3S) binds to and inhibits the activity of DNA methyltransferases (DNMTs) DNMT-1, 3a and 3b, epigenetic regulating enzymes that add methyl groups to DNA (a process called DNA methylation). As such, by inhibiting DNMT activity, DUR-928 inhibits DNA methylation, thereby regulating the expression of genes that modulate crucial cellular activities, including those associated with cell death, stress response, and lipid biosynthesis. These modulations may lead to improved cell survival, and reduced lipid accumulation and inflammation, as has been observed in various in vivo animal models and in results from DURECT's completed clinical trials in alcohol-associated hepatitis (AH) and non-alcoholic steatohepatitis (NASH).
- In July 2021 we presented DUR-928's mechanism of action, the previously reported positive results from our Phase 2a clinical study in alcohol-associated hepatitis (AH), and an overview of the AHFIRM trial at the 2021 Epigenetic Therapeutic Targets Virtual Summit.
- In the Phase 2a clinical trial of DUR-928 in patients with AH, all 19 patients treated with DUR-928 survived the 28-day follow-up period,
74% of patients (14/19) were discharged in ≤ 4 days after receiving a single dose of DUR-928, and there were no drug-related serious adverse events. - Alcohol-associated hepatitis (also called alcoholic hepatitis or AH) is an acute form of alcoholic liver disease (ALD) associated with long-term heavy intake of alcohol, and often occurs after a recent period of increased alcohol consumption. AH is typically characterized by a recent onset of jaundice and hepatic failure. According to the most recent data provided by the Agency for Healthcare Research and Quality (AHRQ), a part of the US Department of Health and Human Services (HHS), there were approximately 132,000 hospitalizations for patients with AH in 2018. From a 2018 publication analyzing the mortality and costs associated with AH, the cost per patient is estimated at over
$50,000 in the first year. ALD is one of the leading causes of liver transplants in the U.S., costing over$875,000 per patient. An analysis of 77 studies published between 1971 and 2016, which included data from a total of 8,184 patients, showed the overall mortality from AH was26% at 28 days and29% at 90 days after admission.
Non-Alcoholic Steatohepatitis (NASH)
- In June 2021, we presented new data showing additional signals of potential efficacy from the NASH Phase 1b study of DUR-928 at the 2021 International Liver Conference (EASL) . This was a randomized and open-label clinical study conducted in the U.S. to evaluate safety, pharmacokinetics and signals of biological activity of DUR-928 in NASH patients with stage 1-3 fibrosis. Subjects in the 50 mg and 150 mg groups had
22% and18% median reductions (not statistically significant) of homeostatic model assessment (HOMA-IR) from baseline, respectively, after 4 weeks of daily oral dosing of DUR-928. NASH subjects also had improvement from baseline in liver stiffness, assessed by transient elastography (TE), magnetic resonance elastography (MRE) and the liver fibrosis marker pro-C3. Positive topline results from this study were previously reported in May 2020. - We have also conducted a Phase 1b open-label, multi-center U.S. study to evaluate the safety, tolerability, and pharmacokinetics (PK) of DUR-928 in subjects with moderate (Child-Pugh B scores, n=10) and severe (Child-Pugh C scores, n=7) hepatic function impairment (HI), and matched control subjects (MCS, n=10) with normal hepatic functions. Each subject received a single oral dose of 200 mg DUR-928. Results from this study were presented at the International Liver Conference 2021 (EASL) in June 2021. DUR-928 was safe and well-tolerated by all moderate and severe HI subjects with no adverse events and no dose-limiting toxicity reported throughout the study. As expected, clearance of DUR-928 was decreased in HI subjects compared to MCS with normal hepatic function, resulting in a 4-10 fold higher drug exposure (Cmax and AUC) in HI subjects. Additionally, a single oral dose of 200 mg of DUR-928 in subjects with HI resulted in statistically significant median reductions from baseline of the apoptosis biomarker M30 (cCK-18) at 12 hours post-dose.
- We are working with a number of disease experts to determine next steps for DUR-928 in NASH.
POSIMIR® (bupivacaine solution) Post-Operative Pain Relief Depot. POSIMIR is DURECT's post-operative pain relief depot that uses the Company's patented SABER® technology that delivers bupivacaine to provide up to 3 days of post-surgical analgesia.
- In February 2021, POSIMIR was granted U.S. FDA approval in adults for administration into the subacromial space under direct arthroscopic visualization to produce post-surgical analgesia for up to 72 hours following arthroscopic subacromial decompression.
- The approval was based on positive data from a randomized, multicenter, assessor-blinded, placebo–controlled clinical trial in patients undergoing arthroscopic subacromial decompression surgery with an intact rotator cuff. The primary outcome measures were mean pain intensity and total opioid rescue analgesia administered, both evaluated over the first 72 hours after surgery versus placebo. POSIMIR demonstrated a statistically significant improvement in both primary outcome measures: a 1.3 point, or
20% , reduction in mean pain intensity on a 0-10 point pain scale (p=0.01), and a67% reduction in I.V. morphine-equivalent rescue opioid use, from a median of 12 mg in the placebo group to 4 mg in the POSIMIR group (p=0.01). In connection with this approval, the Company or its licensee, will be required to conduct two postmarketing non-clinical studies. Full Prescribing Information, including the Boxed Warning, is available at www.POSIMIR.com. - DURECT is in discussions with potential commercial partners for POSIMIR, for which DURECT currently holds worldwide rights.
Debt Amendment. In May 2021, the Company amended its existing
Conference Call
We will host a conference call today at 4:30 p.m. Eastern Time / 1:30 p.m. Pacific Time to discuss second quarter 2021 results and provide a corporate update:
Thursday, July 29 @ 4:30pm Eastern Time / 1:30 p.m. Pacific Time
Toll Free: 877-407-0784
International: 201-689-8560
Conference ID: 13721980
Webcast: http://public.viavid.com/index.php?id=145979
The conference call will also be available by webcast on DURECT's homepage at www.durect.com under the "Investors" tab. If you are unable to participate during the webcast, the call will be archived on DURECT's website under "Event Calendar" in the "Investors" section.
About DURECT Corporation
DURECT is a biopharmaceutical company committed to transforming the treatment of acute organ injury and chronic liver diseases by advancing novel and potentially lifesaving therapies based on its endogenous epigenetic regulator program. DUR-928, the company's lead drug candidate is in clinical development for the potential treatment of alcohol-associated hepatitis (AH) for which FDA has granted a Fast Track Designation; non-alcoholic steatohepatitis (NASH) is also being explored. In addition, POSIMIR® (bupivacaine solution) for infiltration use, a non-opioid analgesic utilizing the innovative SABER® platform technology, is FDA-approved. Full prescribing information about POSIMIR, including the Boxed Warning, can be found at www.posimir.com. For more information about DURECT, please visit www.durect.com and follow us on Twitter https://twitter.com/DURECTCorp.
DURECT Forward-Looking Statement
The statements in this press release regarding the potential for DUR-928 to treat patients with AH and NASH, clinical trial plans, the potential benefits of Fast Track Designation, the potential for the AHFIRM trial to support an NDA filing for DUR-928 in AH, plans to develop DUR-928 in NASH, and plans to seek a commercial licensee for POSIMIR and its commercial launch, are forward-looking statements involving risks and uncertainties that can cause actual results to differ materially from those in such forward-looking statements. Potential risks and uncertainties include, but are not limited to, the risks that the AHFIRM trial takes longer to conduct than anticipated due to COVID-19 or other factors, the risk that ongoing and future clinical trials of DUR-928 do not confirm the results from earlier clinical or pre-clinical trials, or do not demonstrate the safety or efficacy or the life-saving potential of DUR-928 in a statistically significant manner, the risk that Fast Track designation for DUR-928 in AH may not actually lead to faster FDA review or an approval, risks that biomarker data in earlier trials of DUR-928 may not predict clinical efficacy, risks that we may not enter a commercial license for POSIMIR on favorable terms, if at all, risks that we or a licensee may not commercialize POSIMIR successfully, if at all, and risks related to entering into new agreements or our ability to obtain capital to fund operations and expenses. Further information regarding these and other risks is included in DURECT's Form 10-K filed on May 5, 2021 and in our Form 10-Q for the quarter ended June 30, 2021 when filed with the Securities and Exchange Commission under the heading "Risk Factors."
NOTE: POSIMIR® and SABER® are trademarks of DURECT Corporation. Other referenced trademarks belong to their respective owners. DUR-928 is an investigational drug candidate under development and has not been approved for commercialization by the U.S. Food and Drug Administration or other health authorities for any indication. Full prescribing information for POSIMIR, including its Boxed Warning, can be found at www.posimir.com.
DURECT CORPORATION
| |||||||||
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME | |||||||||
(in thousands, except per share amounts) | |||||||||
(unaudited) | |||||||||
Three months ended | Six months ended | ||||||||
June 30 | June 30 | ||||||||
2021 | 2020 | 2021 | 2020 | ||||||
Collaborative research and development and other revenue | $ 735 | $ 23,347 | $ 1,309 | $ 23,317 | |||||
Product revenue, net | 1,568 | 1,151 | 3,206 | 2,776 | |||||
Total revenues | 2,303 | 24,498 | 4,515 | 26,093 | |||||
Operating expenses: | |||||||||
Cost of product revenues | 359 | 253 | 711 | 649 | |||||
Research and development | 7,433 | 6,567 | 15,408 | 14,154 | |||||
Selling, general and administrative | 3,168 | 3,337 | 6,699 | 6,768 | |||||
Total operating expenses | 10,960 | 10,157 | 22,818 | 21,571 | |||||
(Loss) income from operations | (8,657) | 14,341 | (18,303) | 4,522 | |||||
Other income (expense): | |||||||||
Interest and other income | 39 | 135 | 76 | 393 | |||||
Interest and other expense | (528) | (552) | (1,053) | (1,144) | |||||
Net other expense | (489) | (417) | (977) | (751) | |||||
(Loss) income from continuing operations | (9,146) | 13,924 | (19,280) | 3,771 | |||||
Income from discontinued operations | - | 414 | - | 619 | |||||
Net (loss) income | $ (9,146) | $ 14,338 | $ (19,280) | $ 4,390 | |||||
Net (loss) income per share | |||||||||
Basic and Diluted | |||||||||
(Loss) income from Continuing operations | $ (0.04) | $ 0.07 | $ (0.09) | $ 0.02 | |||||
Income from discontinued operations | $ - | $ 0.00 | $ - | $ 0.00 | |||||
Weighted-average shares used in computing net (loss) income per share | |||||||||
Basic | 227,428 | 196,866 | 222,510 | 196,306 | |||||
Diluted | 227,428 | 207,477 | 222,510 | 206,111 | |||||
Total comprehensive (loss) income | $ (9,133) | $ 14,427 | $ (19,276) | $ 4,464 | |||||
DURECT CORPORATION
| ||||
CONDENSED BALANCE SHEETS | ||||
(in thousands) | ||||
As of | As of | |||
June 30, 2021 | December 31, 2020(1) | |||
(unaudited) | ||||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | $ 56,073 | $ 21,312 | ||
Cash held in escrow | - | 14,979 | ||
Short-term investments | 32,357 | 19,421 | ||
Accounts receivable | 816 | 940 | ||
Inventories, net | 1,918 | 1,864 | ||
Prepaid expenses and other current assets | 4,192 | 4,545 | ||
Total current assets | 95,356 | 63,061 | ||
Property and equipment, net | 211 | 251 | ||
Operating lease right-of-use assets | 4,120 | 4,749 | ||
Goodwill | 6,169 | 6,169 | ||
Long-term investments | - | 1,000 | ||
Long-term restricted Investments | 150 | 150 | ||
Other long-term assets | 261 | 261 | ||
Total assets | $ 106,267 | $ 75,641 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Accounts payable | $ 1,086 | $ 1,678 | ||
Accrued liabilities | 5,114 | 5,801 | ||
Contract research liability | 192 | 545 | ||
Deferred revenue, current portion | 5 | - | ||
Term loan, current portion, net | - | 884 | ||
Operating lease liabilities, current portion | 1,821 | 1,795 | ||
Total current liabilities | 8,218 | 10,703 | ||
Deferred revenue, noncurrent portion | 812 | 812 | ||
Operating lease liabilities, noncurrent portion | 2,542 | 3,202 | ||
Term loan, noncurrent portion, net | 20,360 | 19,936 | ||
Other long-term liabilities | 873 | 873 | ||
Stockholders' equity | 73,462 | 40,115 | ||
Total liabilities and stockholders' equity | $ 106,267 | $ 75,641 | ||
(1) Derived from audited financial statements. | ||||
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