DURECT Corporation Reports First Quarter 2024 Financial Results and Business Update
DURECT (Nasdaq: DRRX) announced its Q1 2024 financial results, showing $1.8 million in revenue and a net loss of $7.6 million, an improvement from the $12.0 million loss in Q1 2023. The company has $21.6 million in cash and investments, with a debt of $14.6 million as of March 31, 2024. The FDA's feedback supports a single pivotal Phase 3 trial for larsucosterol in alcohol-associated hepatitis (AH), with new Phase 3 protocol details expected later this year. DURECT will present Phase 2b AHFIRM trial data at the EASL Congress in June 2024. A webcast of the earnings call will be held today at 4:30 p.m. ET.
- FDA supports a single pivotal Phase 3 trial for larsucosterol in alcohol-associated hepatitis, potentially leading to NDA filing.
- Q1 2024 net loss improved to $7.6 million from $12.0 million in Q1 2023.
- Upcoming presentation of Phase 2b AHFIRM trial data at EASL Congress 2024 in June.
- Debt reduced to $14.6 million from $16.7 million in the previous quarter.
- Q1 2024 revenue decreased to $1.8 million from $2.1 million in Q1 2023.
- Cash and investments dropped to $21.6 million from $29.8 million at the end of 2023.
Insights
Overall, DURECT Corporation's first quarter financial results reflect a mixed picture for investors. **Revenue** for Q1 2024 at
It's essential to scrutinize the **cash balance**. The current cash, cash equivalents and investments total
For retail investors, the reduction in net loss and debt are positive signs, but the decline in revenue and cash reserve requires close monitoring. The company's ability to execute its clinical trials and bring products to market will be critical in the coming quarters. Investors should understand that biopharmaceutical companies often experience fluctuations in financial metrics based on their research and development cycles.
DURECT Corporation's progress with larsucosterol is a significant development in the treatment landscape for **alcohol-associated hepatitis (AH)**. The **FDA’s support** for a single pivotal Phase 3 trial is a notable milestone. This streamlined approach could potentially accelerate the time to market, subject to positive trial outcomes. The previous Phase 2b AHFIRM trial has provided a foundation and incorporating FDA feedback should enhance the design of the upcoming Phase 3 trial.
Retail investors should recognize that **FDA approvals** are often subject to rigorous scrutiny and timelines and the success of these trials is not guaranteed. The planned presentation of Phase 2b data at the **EASL Congress 2024** further adds credibility and visibility to the drug's potential, allowing for peer review and independent validation of results.
In the short term, this update is promising, showing progression in the clinical pipeline. However, the long-term value hinges on the successful execution of the Phase 3 trial and subsequent regulatory approvals. Understanding the **clinical trial phases** can be critical: Phase 3 is typically the last step before seeking market approval, involving larger patient populations to confirm efficacy and monitor adverse reactions.
- FDA Feedback Supports Single Pivotal Trial for Approval of Larsucosterol in Alcohol-Associated Hepatitis
- Webcast of Earnings Call Today, May 13th at 4:30 p.m. ET
"We are pleased that the feedback from the
Business Update:
- During a Type C meeting with the FDA, DURECT received feedback on the recommendations for a Phase 3 clinical trial for larsucosterol in AH that could support a potential NDA filing. DURECT is in the process of designing its planned Phase 3 clinical trial based on the FDA feedback and the results from its completed Phase 2b AHFIRM clinical trial.
- DURECT announced the acceptance of a late-breaking oral presentation at the European Association for the Study of the Liver (EASL) Congress 2024 to take place June 5-8, 2024 in
Milan, Italy . The presentation will feature data from the Company's Phase 2b AHFIRM trial, which evaluated the safety and efficacy of larsucosterol as a treatment for patients with severe AH.
Financial Highlights for Q1 2024:
- Total revenues were
$1.8 million $7.6 million $2.1 million $12.0 million - Cash, cash equivalents and investments were
$21.6 million $29.8 million $14.6 million $16.7 million
Earnings Conference Call
We will host a conference call and webcast today at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time to discuss the first quarter 2024 results and provide a corporate update:
Monday, May 13 @ 4:30 p.m. Eastern Time / 1:30 p.m. Pacific Time
Toll Free: | 1-877-407-0790 |
International: | 1-201-689-8560 |
Conference ID: | 13746111 |
Webcast: | https://callme.viavid.com/viavid/?callme=true&passcode=13740526&h=true&info=company-email&r=true&B=6 |
A live audio webcast of the presentation will be also available by accessing DURECT's homepage at www.durect.com on the "Events" page, under the "Investors" section. If you are unable to participate during the live webcast, the call will be archived on DURECT's website under the same section, following the completion of the call.
About the AHFIRM Trial
AHFIRM was a Phase 2b randomized, double-blind, placebo-controlled, international, multi-center study conducted in subjects with severe alcohol-associated hepatitis (AH) to evaluate the saFety and effIcacy of laRsucosterol treatMent (AHFIRM). The study was comprised of three arms and enrolled 307 patients, with approximately 100 patients in each arm: (1) Placebo, which consists of standard of care, with or without methylprednisolone capsules at the investigators' discretion; (2) larsucosterol (30 mg); and (3) larsucosterol (90 mg). Patients in the larsucosterol arms received the same supportive care without steroids. The primary outcome measure was the 90-Day incidence of mortality or liver transplantation for patients treated with larsucosterol compared to those treated with placebo, and the key secondary endpoint was 90-Day survival. The Company enrolled patients at clinical trial sites across the
About Alcohol-associated Hepatitis (AH)
AH is an acute form of alcohol-associated liver disease (ALD) associated with long-term heavy alcohol intake, often following a recent period of increased consumption (i.e., a binge). AH is typically characterized by severe inflammation and liver cell damage, potentially leading to life-threatening complications including liver failure, acute kidney injury and multi-organ failure. There are no FDA approved therapies for AH, and a retrospective analysis of 77 studies published between 1971 and 2016, which included data from 8,184 patients, showed the overall mortality from AH was
About Larsucosterol
Larsucosterol is an endogenous sulfated oxysterol and an epigenetic modulator. Epigenetic regulators are compounds that regulate patterns of gene expression without modifying the DNA sequence. DNA hypermethylation, an example of epigenetic dysregulation, results in transcriptomic reprogramming and cellular dysfunction, and has been reported in many acute (e.g., AH) and chronic diseases (e.g., MASH). As an inhibitor of DNA methyltransferases (DNMT1, DNMT3a and 3b), larsucosterol inhibits DNA methylation, which subsequently modulates expression of genes that are involved in cell signaling pathways associated with stress responses, cell death and survival, and lipid biosynthesis. This may ultimately lead to improved cell survival, reduced inflammation, and decreased lipotoxicity. As an epigenetic modulator, the proposed mechanism of action provides further scientific rationale for developing larsucosterol for the treatment of acute organ injury and certain chronic diseases.
About DURECT Corporation
DURECT is a late-stage biopharmaceutical company pioneering the development of epigenetic therapies that target dysregulated DNA methylation to transform the treatment of serious and life-threatening conditions, including acute organ injury and cancer. Larsucosterol, DURECT's lead drug candidate, binds to and inhibits the activity of DNA methyltransferases (DNMTs), epigenetic enzymes that are elevated and associated with hypermethylation found in alcohol-associated hepatitis (AH) patients. Larsucosterol is in clinical development for the potential treatment of AH, for which FDA has granted a Fast Track Designation; metabolic dysfunction-associated steatohepatitis (MASH) 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 and is exclusively licensed to Innocoll Pharmaceuticals for sale and distribution in the
DURECT Forward-Looking Statements
This press release contains forward-looking statements, including statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, relating to: the potential for a single Phase 3 trial of larsucosterol, if successful, to support an NDA filing, and the potential uses and benefits of laruscosterol in patients with AH and potentially other indications. Actual results may differ materially from those contained in the forward-looking statements contained in this press release, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from those projected include, among other things, the risk that future clinical trials of larsucosterol are delayed or do not confirm the results from subset analyses of the AHFIRM trial, including geographic or other segmentation, or of earlier clinical or pre-clinical trials, or do not demonstrate the safety or efficacy of larsucosterol in a statistically significant manner; the risk that the FDA or other government agencies may require additional clinical trials for larsucosterol before approving larsucosterol for the treatment of AH, and that larsucosterol may never be approved; risks that Innocoll may not commercialize POSIMIR successfully; and risks related to the sufficiency of our cash resources, our anticipated capital requirements, our need or desire for additional financing, our ability to continue to meet the minimum bid price for continued listing on Nasdaq, our ability to obtain capital to fund our operations and expenses, and our ability to continue to operate as a going concern. Further information regarding these and other risks is included in DURECT's most recent Securities and Exchange Commission (SEC) filings, including its annual report on Form 10-K for the year ended December 31, 2023 and quarterly report on Form 10-Q for the quarter ended March 31, 2024, when filed, under the heading "Risk Factors." These reports are available on our website www.durect.com under the "Investors" tab and on the SEC's website at www.sec.gov. All information provided in this press release and in the attachments is based on information available to DURECT as of the date hereof, and DURECT assumes no obligation to update this information as a result of future events or developments, except as required by law.
NOTE: POSIMIR® is a trademark of Innocoll Pharmaceuticals, Ltd. in the
DURECT CORPORATION CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (in thousands, except per share amounts) (Unaudited) | |||||
Three months ended | |||||
March 31 | |||||
2024 | 2023 | ||||
Collaborative research and development and other revenue | $ 496 | $ 643 | |||
Product revenue, net | 1,331 | 1,411 | |||
Total revenues | 1,827 | 2,054 | |||
Operating expenses: | |||||
Cost of product revenues | 289 | 388 | |||
Research and development | 4,119 | 8,593 | |||
Selling, general and administrative | 3,136 | 4,095 | |||
Total operating expenses | 7,544 | 13,076 | |||
Loss from operations | (5,717) | (11,022) | |||
Other income (expense): | |||||
Interest and other income | 321 | 517 | |||
Interest and other expenses | (529) | (726) | |||
Change in fair value of warrant liabilities | (1,718) | 2,477 | |||
Issuance cost for warrants | - | (1,200) | |||
Loss on issuance of warrants | - | (2,033) | |||
Other income (expense), net | (1,926) | (965) | |||
Net loss | (7,643) | (11,987) | |||
Net change in unrealized gain on available-for-sale securities, net of reclassification adjustments and taxes | 4 | 6 | |||
Total comprehensive loss | $ (7,639) | $ (11,981) | |||
Net loss per share | |||||
Basic | $ (0.25) | $ (0.50) | |||
Diluted | $ (0.25) | $ (0.52) | |||
Weighted-average shares used in computing net loss per share | |||||
Basic | 30,637 | 23,767 | |||
Diluted | 30,637 | 23,940 | |||
DURECT CORPORATION CONDENSED BALANCE SHEETS (in thousands) (unaudited) | ||||
As of | As of | |||
March 31, 2024 | December 31, 2023 (1) | |||
(unaudited) | ||||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | $ 19,252 | $ 28,400 | ||
Short-term Investments | 2,187 | 1,280 | ||
Accounts receivable, net | 1,020 | 1,261 | ||
Inventories, net | 2,398 | 2,219 | ||
Prepaid expenses and other current assets | 1,228 | 1,511 | ||
Total current assets | 26,085 | 34,671 | ||
Property and equipment, net | 58 | 91 | ||
Operating lease right-of-use assets | 3,631 | 3,980 | ||
Goodwill | 6,169 | 6,169 | ||
Long-term restricted Investments | 150 | 150 | ||
Other long-term assets | 128 | 128 | ||
Total assets | $ 36,221 | $ 45,189 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Accounts payable | $ 782 | $ 1,777 | ||
Accrued liabilities | 5,105 | 5,966 | ||
Term loan, current portion, net | 14,612 | 16,663 | ||
Operating lease liabilities, current portion | 1,298 | 1,381 | ||
Warrant liabilities | 2,942 | 1,224 | ||
Total current liabilities | 24,739 | 27,011 | ||
Operating lease liabilities, noncurrent portion | 2,466 | 2,702 | ||
Other long-term liabilities | 716 | 693 | ||
Stockholders' equity | 8,300 | 14,783 | ||
Total liabilities and stockholders' equity | $ 36,221 | $ 45,189 | ||
(1) Derived from audited financial statements. | ||||
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SOURCE DURECT Corporation
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