Minerva Neurosciences Reports Fourth Quarter and Fiscal Year 2023 Financial Results and Business Updates
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Insights
The acceptance of Minerva Neurosciences' New Drug Application (NDA) for roluperidone by the FDA is a pivotal event that could significantly alter the company's financial trajectory. The potential approval of this drug, positioned as the first to treat negative symptoms of schizophrenia, may open a new revenue stream for Minerva, addressing an unmet medical need. This is particularly noteworthy considering the global antipsychotic drug market is projected to grow, signaling a substantial market opportunity for new treatments.
From a financial perspective, the reported increase in R&D expenses in the fourth quarter is aligned with the company's strategic focus on FDA approval processes. However, the year-over-year decrease in R&D expenses suggests a past peak in development costs for roluperidone, which could imply a transition from a development phase to a potential commercialization phase, pending FDA approval. The increase in G&A expenses is typical as companies prepare for potential product launches and scale operations.
Minerva's net loss has narrowed year-over-year and an improved cash position enhances its financial stability in the short term. However, the reported non-cash interest expense related to the sale of future royalties indicates a financial obligation that stakeholders should monitor, as it may impact future revenue.
Roluperidone's potential market entry is a significant development in the field of schizophrenia treatment, particularly for negative symptoms which are notoriously difficult to manage and have few effective treatments. The drug's progress is closely watched by the medical community as it could set a new standard of care.
The clinical efficacy and safety profile of roluperidone will be under scrutiny, as these factors will determine its adoption by healthcare providers and its impact on patient outcomes. Furthermore, the cost-effectiveness of the drug, once approved, would be a critical factor in its market penetration, given the increasing emphasis on healthcare economics.
Given the chronic nature of schizophrenia and the potential for long-term treatment regimens, roluperidone could represent a sustained revenue source for Minerva if approved. Stakeholders should also consider the implications of market access strategies, including insurance coverage and pricing, which will be key determinants of the drug's commercial success.
The market potential for roluperidone hinges on its differentiation from existing antipsychotics, which primarily address positive symptoms of schizophrenia. The focus on negative symptoms could allow Minerva to capture a niche segment of the market. Market research indicates a demand for innovative treatments in mental health and roluperidone's approval could disrupt the current treatment landscape.
Investor and market reactions to Minerva's financial results may vary. While the improved cash position suggests a buffer for near-term operations, the reality of biopharmaceutical investments is that long-term returns are speculative and contingent on successful product launches and market adoption. The company's strategic decisions in the coming months, particularly regarding partnerships, marketing and sales strategy, will be critical in realizing the value of roluperidone, should it gain approval.
Analysts will also be watching the PDUFA goal date closely, as FDA decisions can significantly impact stock prices. Positive regulatory outcomes often lead to stock surges, whereas negative decisions or delays can result in declines. The broader market implications of Minerva's progress with roluperidone will become clearer as the PDUFA goal date approaches and upon the announcement of the FDA's decision.
BURLINGTON, Mass., Feb. 22, 2024 (GLOBE NEWSWIRE) -- Minerva Neurosciences, Inc. (Nasdaq: NERV), a clinical-stage biopharmaceutical company focused on the development of therapies to treat central nervous system disorders, today reported business updates and financial results for the fourth quarter and year ended December 31, 2023.
Corporate Update
On May 8 2023, the U.S. Food and Drug Administration (FDA) confirmed acceptance for filing of Minerva’s New Drug Application (NDA) for roluperidone for the treatment of negative symptoms of schizophrenia. The Company was advised of a Prescription Drug User Fee Act (PDUFA) goal date of February 26, 2024 and has continued to work with the FDA during its review of the NDA.
“Minerva achieved a significant milestone in 2023, with the acceptance of our NDA for roluperidone, which if approved will be the first ever medication for negative symptoms of schizophrenia to receive regulatory approval. This milestone also brings hope to the patients, families and physicians caring for those experiencing negative symptoms of schizophrenia who currently have no treatment options,” said Dr. Remy Luthringer, Executive Chairman and Chief Executive Officer of Minerva.
Fourth Quarter and Year End Financial Results
- Research and development (R&D) expense: For the three months ended December 31, 2023 and 2022, R&D expense was
$4.7 million and$3.2 million , respectively. R&D expense was higher versus the prior year period primarily due to costs associated with the FDA’s review of the Company’s NDA and higher compensation expenses. For the years ended December 31, 2023 and 2022, R&D expense was$12.7 million and$14.6 million , respectively. The decrease in R&D expense versus the prior year was primarily due to lower costs related to the preparation of our NDA for roluperidone, which was submitted during 2022, and lower non-cash stock compensation costs, partially offset by higher compensation expenses. - General and administrative (G&A) expense: For the three months ended December 31, 2023 and 2022, G&A expense was
$2.5 million and$1.9 million , respectively. G&A expense was higher versus the prior year period primarily due to higher compensation expenses and professional service fees. For the years ended December 31, 2023 and 2022, G&A expense was$10.4 million and$10.6 million , respectively. The decrease in G&A expense versus the prior year was primarily due to lower non-cash stock compensation costs and insurance costs, partially offset by higher professional service fees and compensation expenses. - Non-cash interest expense: For the three months ended December 31, 2023 and 2022, non-cash interest expense for the sale of future royalties was
$2.2 million and$1.9 million , respectively. For the years ended December 31, 2023 and 2022, non-cash interest expense was$8.3 million and$7.4 million , respectively. The increase for both the fourth quarter and year ended December 31, 2023 versus the prior year periods was primarily due to the amortization of non-cash interest expense for the difference between the balance of the liability related to the sale of future royalties and the estimated amount of future royalties to be received over the royalty period. - Net loss: Net loss was
$9.0 million for the three months ended December 31, 2023, or net loss per share of$1.19 b asic and diluted, as compared to net loss of$6.7 million , or net loss per share of$1.26 b asic and diluted, for the three months ended December 31, 2022. Net loss was$30.0 million for the year ended December 31, 2023, or net loss per share of$4.61 b asic and diluted, as compared to net loss of$32.1 million , or net loss per share of$6.01 b asic and diluted for the year ended December 31, 2022. - Cash Position: Cash, cash equivalents and restricted cash at December 31, 2023, were approximately
$41.0 million , as compared to$36.2 million at December 31, 2022.
About Minerva Neurosciences
Minerva Neurosciences, Inc. (Nasdaq: NERV) is a clinical-stage biopharmaceutical company focused on developing product candidates to treat central nervous system (CNS) diseases. Our goal is to transform the lives of patients with improved therapeutic options. Minerva’s portfolio of compounds includes roluperidone (f/k/a MIN-101), for negative symptoms of schizophrenia, and MIN-301, for Parkinson’s disease. For more information, please visit our website.
Forward-Looking Safe Harbor Statement
This press release contains forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are statements that are not historical facts, reflect management’s expectations as of the date of this press release, and involve certain risks and uncertainties. Forward-looking statements include, but are not limited to, statements herein with respect to the regulatory progress and therapeutic potential of roluperidone for the treatment of negative symptoms in patients with schizophrenia. These forward-looking statements are based on our current expectations and may differ materially from actual results due to a variety of factors including, without limitation, whether the FDA will require additional trials or data which may significantly delay and put at risk our efforts to obtain regulatory approval; whether the FDA may meet expected review timelines for our NDA; whether roluperidone will be successfully marketed if approved; management’s ability to successfully achieve its goals; our ability to raise additional capital to fund our operations and corporate objectives on terms acceptable to us; general economic conditions; and other factors that are described under the caption “Risk Factors” in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on February 22, 2024. Copies of reports filed with the SEC are posted on our website at http://ir.minervaneurosciences.com/. The forward-looking statements in this press release are based on information available to us as of the date hereof, and we disclaim any obligation to update any forward-looking statements, except as required by law.
Contact:
Investor inquiries:
Frederick Ahlholm
Chief Financial Officer
Minerva Neurosciences, Inc.
info@minervaneurosciences.com
Media inquiries:
Helen Shik
Principal
Shik Communications LLC
helen@shikcommunications.com
| CONDENSED CONSOLIDATED BALANCE SHEET DATA | ||||||
| (Unaudited) | ||||||
| December 31, 2023 | December 31, 2022 | |||||
| (in thousands) | ||||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 40,913 | $ | 36,094 | ||
| Restricted cash | 100 | 100 | ||||
| Refundable regulatory fee | - | 3,117 | ||||
| Prepaid expenses and other current assets | 989 | 848 | ||||
| Total current assets | 42,002 | 40,159 | ||||
| Equipment and capitalized software, net | 29 | 59 | ||||
| Goodwill | 14,869 | 14,869 | ||||
| Total assets | $ | 56,900 | $ | 55,087 | ||
| LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY | ||||||
| Current liabilities: | ||||||
| Accounts payable | $ | 1,805 | $ | 969 | ||
| Accrued expenses and other current liabilities | 1,535 | 408 | ||||
| Total current liabilities | 3,340 | 1,377 | ||||
| Long-term liabilities: | ||||||
| Liability related to the sale of future royalties | 82,017 | 73,734 | ||||
| Total liabilities | 85,357 | 75,111 | ||||
| Stockholders' (deficit) equity: | ||||||
| Common stock | 1 | 1 | ||||
| Additional paid-in capital | 368,357 | 346,785 | ||||
| Accumulated deficit | (396,815 | ) | (366,810 | ) | ||
| Total stockholders' (deficit) equity | (28,457 | ) | (20,024 | ) | ||
| Total liabilities and stockholders' (deficit) equity | $ | 56,900 | $ | 55,087 | ||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended December 31, (in thousands, except per share amounts) | Twelve Months Ended December 31, (in thousands, except per share amounts) | |||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||
| Operating expenses: | ||||||||||||||
| Research and development | $ | 4,721 | $ | 3,190 | $ | 12,705 | $ | 14,649 | ||||||
| General and administrative | 2,451 | 1,880 | 10,414 | 10,582 | ||||||||||
| Total operating expenses | 7,172 | 5,070 | 23,119 | 25,231 | ||||||||||
| Loss from operations | (7,172 | ) | (5,070 | ) | (23,119 | ) | (25,231 | ) | ||||||
| Foreign exchange (losses) gains | (19 | ) | (28 | ) | (40 | ) | (28 | ) | ||||||
| Investment income | 359 | 297 | 1,437 | 557 | ||||||||||
| Non-cash interest expense for the sale of future royalties | (2,190 | ) | (1,925 | ) | (8,283 | ) | (7,407 | ) | ||||||
| Net loss | $ | (9,022 | ) | $ | (6,726 | ) | $ | (30,005 | ) | $ | (32,109 | ) | ||
| Net loss per share, basic and diluted | $ | (1.19 | ) | $ | (1.26 | ) | $ | (4.61 | ) | $ | (6.01 | ) | ||
| Weighted average shares outstanding, basic and diluted | 7,569 | 5,340 | 6,506 | 5,340 | ||||||||||
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