Minerva Neurosciences Reports Fourth Quarter and Fiscal Year 2024 Financial Results and Business Updates

Rhea-AI Summary

Minerva Neurosciences (Nasdaq: NERV) reported its Q4 and fiscal year 2024 financial results. The company continues to address questions raised in the FDA's Complete Response Letter (CRL) for roluperidone, its treatment for negative symptoms in schizophrenia patients.

Financial highlights include: R&D expenses decreased to $2.0 million for Q4 2024 (vs $4.7 million in Q4 2023) and $11.9 million for full-year 2024 (vs $12.7 million in 2023). G&A expenses remained at $2.5 million for Q4 2024 and decreased to $9.9 million for full-year 2024 (vs $10.4 million in 2023).

The company reported a Q4 2024 net loss of $4.3 million ($0.56 per share) compared to a $9.0 million loss ($1.19 per share) in Q4 2023. For the full year 2024, Minerva reported net income of $1.4 million ($0.19 per share) versus a net loss of $30.0 million ($4.61 per share) in 2023. Cash position stood at $21.5 million as of December 31, 2024, down from $41.0 million a year earlier.

Positive

• Net income of $1.4 million for full-year 2024 vs. net loss of $30.0 million in 2023
• Q4 2024 net loss reduced to $4.3 million from $9.0 million in Q4 2023
• R&D expenses decreased to $2.0 million in Q4 2024 from $4.7 million in Q4 2023
• Recognition of $26.6 million in other income from adjustment to royalty liability

Negative

• FDA issued Complete Response Letter for roluperidone NDA
• Cash position decreased to $21.5 million from $41.0 million year-over-year
• Continued uncertainty regarding FDA approval timeline for roluperidone

Insights

Financial Analyst

Minerva Neurosciences' Q4 and FY2024 financial results reveal a concerning picture beneath a superficially improved bottom line. While the company reported net income of $1.4 million for 2024 (compared to a $30 million loss in 2023), this positive result stems entirely from a $26.6 million non-cash accounting adjustment related to the company's royalty obligations - not from operational improvements.

The company's cash position has deteriorated by 47.6% year-over-year, falling to $21.5 million from $41 million. At the current quarterly cash burn rate of approximately $4.9 million, Minerva has roughly 4-5 quarters of runway remaining before requiring additional financing, creating potential dilution risks for current shareholders.

The FDA's Complete Response Letter (CRL) for roluperidone represents the most significant challenge facing Minerva. As the company's lead asset targeting negative symptoms in schizophrenia - an area with substantial unmet medical need and competition - roluperidone's regulatory pathway is critical to Minerva's valuation. The company's vague statement about "continuing to have interactions with the FDA" provides little clarity on whether or how they can address the regulator's concerns.

The 47% reduction in Q4 R&D expenses ($2.0M vs $4.7M) suggests scaled-back investment in clinical development, which may reflect both the regulatory uncertainty and financial constraints. This reduction could potentially slow the advancement of Minerva's pipeline, which includes MIN-301 for Parkinson's disease (though no meaningful updates were provided on this program).

Most telling is the adjustment to the royalty liability, which indicates management has significantly downgraded expectations for future revenue streams. This accounting change effectively acknowledges that future royalties are likely to be substantially lower than previously projected, suggesting diminished commercial expectations even if roluperidone eventually reaches the market.

For investors, Minerva presents a high-risk scenario with a market cap ($13.6 million) that's now lower than its cash position - reflecting deep market skepticism about the company's ability to overcome regulatory hurdles and successfully commercialize its pipeline. Without a clear path forward for roluperidone or significant pipeline diversification, the company faces substantial challenges in creating sustainable shareholder value.

BURLINGTON, Mass., Feb. 25, 2025 (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, 2024.   

Corporate Update

As previously disclosed in the first quarter of 2024, the U.S. Food and Drug Administration (FDA) issued a Complete Response Letter (CRL) to our New Drug Application (NDA) for roluperidone for the treatment of negative symptoms in patients with schizophrenia. The company continues to have interactions with the FDA with the goal of addressing questions raised in the CRL. 

Fourth Quarter and Year End Financial Results

Research and development (R&D) expense: For the three months ended December 31, 2024 and 2023, R&D expense was $2.0 million and $ 4.7 million, respectively. R&D expense was lower versus the prior year period primarily due to costs associated with the FDA’s review of our NDA for roluperidone, costs for the C18 study, and lower compensation expenses. For the years ended December 31, 2024 and 2023, R&D expense was $ 11.9 million and $12.7 million, respectively. R&D expense was lower versus the prior year period primarily due to costs associated with the C18 study and lower compensation expenses, partially offset by higher costs associated with our drug substance validation campaign.

General and administrative (G&A) expense: For both of the three months ended December 31, 2024 and 2023, G&A expense was $2.5 million. For the years ended December 31, 2024 and 2023, G&A expense was $9.9 million and $10.4 million, respectively. G&A expense was lower versus the prior year period primarily due to lower compensation expenses, partially offset by higher professional service fees.

Non-cash interest expense: For the three months and year ended December 31, 2024, non-cash interest expense for the sale of future royalties was $0 and $4.6 million, respectively, as compared to $2.2 million and $8.3 million for the three months and year ended December 31, 2024, respectively. Non-cash interest expense was lower versus the prior year periods as a result of the Company revising its estimates for the timing and amount of future royalty payments to be received under the royalty arrangement. During the third quarter of 2024, the Company adjusted the carrying amount of its Liability related to the sale of future royalties to the initial payment of $60 million. This adjustment resulted in the recognition of $26.6 million in Other Income during the third quarter of 2024, representing the amount of non-cash interest expense amortized through June 30, 2024.

Other income: For both the three months ended December 31, 2024 and 2023, other income was $0. For the years ended December 31, 2024 and 2023, other income was $26.6 million and $0, respectively. The Company recognized Other Income in the third quarter of 2024 as a result of the adjustment to the carrying amount of the Liability related to the sale of future royalties.

Net income (loss): Net loss was $4.3 million for the three months ended December 31, 2024, or net loss per share of $0.56 basic and diluted, as compared to net loss of $9.0 million, or net loss per share of $1.19 basic and diluted, for the three months ended December 31, 2023. Net income was $1.4 million for the year ended December 31, 2024, or net income per share of $0.19 basic and diluted, as compared to net loss of $30.0 million, or net loss per share of $4.61 basic and diluted for the year ended December 31, 2023. As noted above, the adjustment to the carrying amount of the Liability related to the sale of future royalties during the third quarter of 2024 resulted in net income for the year ended December 31, 2024.

Cash Position: Cash, cash equivalents and restricted cash at December 31, 2024, were approximately $21.5 million, as compared to $41.0 million at December 31, 2023.

About Minerva Neurosciences

Minerva Neurosciences, Inc. is a clinical-stage biopharmaceutical company focused on developing product candidates to treat CNS diseases. Minerva’s goal is to transform the lives of patients with improved therapeutic options, including roluperidone for negative symptoms of schizophrenia and MIN-301 for Parkinson’s disease. For more information, please visit the Company’s 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 Minerva’s ability to remediate or otherwise resolve issues and deficiencies identified in the CRL and the outcome of its interactions with the FDA. 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, Minerva’s ability to address FDA’s feedback and timing thereof; uncertainties associated with regulatory processes, including the content and timing of decisions by the FDA; general risks associated with developing biopharmaceutical product candidates; management’s ability to successfully achieve its goals; our ability to raise additional capital to fund its clinical development plans, operations and corporate objectives on terms acceptable to Minerva; general economic conditions; and other factors that are described under the caption “Risk Factors” in Minerva’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission on February 25, 2025. Copies of reports filed with the SEC are posted on Minerva’s website at http://ir.minervaneurosciences.com/. The forward-looking statements in this press release are based on information available to the Company as of the date hereof, and the Company disclaims 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, 2024			December 31, 2023
	(in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	21,362		$	40,913
Restricted cash		100			100
Prepaid expenses and other current assets		807			989
Total current assets		22,269			42,002
Equipment and capitalized software, net		6			29
Goodwill		14,869			14,869
Total assets	$	37,144		$	56,900
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable	$	1,608		$	1,805
Accrued expenses and other current liabilities		1,229			1,535
Total current liabilities		2,837			3,340
Long-term liabilities:
Liability related to the sale of future royalties		60,000			82,017
Total liabilities		62,837			85,357
Stockholders' deficit:
Common stock		1			1
Additional paid-in capital		369,683			368,357
Accumulated deficit		(395,377	)		(396,815	)
Total stockholders' deficit		(25,693	)		(28,457	)
Total liabilities and stockholders' deficit	$	37,144		$	56,900

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)
		2024			2023				2024			2023
Operating expenses:
Research and development		$	1,983		$	4,721			$	11,899		$	12,705
General and administrative			2,539			2,451				9,949			10,414
Total operating expenses			4,522			7,172				21,848			23,119
Loss from operations			(4,522	)		(7,172	)			(21,848	)		(23,119	)
Foreign exchange gains (losses)			10			(19	)			(2	)		(40	)
Investment income			240			359				1,272			1,437
Non-cash interest expense for the sale of future royalties			-			(2,190	)			(4,562	)		(8,283	)
Other income			-			-				26,579			-
Net income (loss)		$	(4,272	)	$	(9,022	)		$	1,439		$	(30,005	)
Net income (loss) per share, basic		$	(0.56	)	$	(1.19	)		$	0.19		$	(4.61	)
Weighted average shares outstanding, basic			7,569			7,569				7,569			6,506
Net income (loss) per share, diluted		$	(0.56	)	$	(1.19	)		$	0.19		$	(4.61	)
Weighted average shares outstanding, diluted			7,569			7,569				7,574			6,506

FAQ

What caused Minerva Neurosciences (NERV) to report net income in 2024 despite the FDA setback?

Minerva reported net income of $1.4 million for 2024 primarily due to a $26.6 million adjustment to its liability related to the sale of future royalties, which was recognized as other income in Q3 2024.

How much did NERV's cash position decrease in 2024?

Minerva's cash position decreased by $19.5 million, from $41.0 million at December 31, 2023, to $21.5 million at December 31, 2024.

What is the current status of Minerva's (NERV) roluperidone FDA application?

Minerva continues to have interactions with the FDA to address questions raised in the Complete Response Letter (CRL) issued in Q1 2024 for roluperidone's New Drug Application.

How did NERV's R&D expenses change in Q4 2024 compared to Q4 2023?

R&D expenses decreased by $2.7 million, from $4.7 million in Q4 2023 to $2.0 million in Q4 2024, primarily due to reduced costs associated with the FDA's NDA review, the C18 study, and lower compensation expenses.

What was Minerva Neurosciences' (NERV) earnings per share for full-year 2024?

Minerva reported net income per share of $0.19 (both basic and diluted) for the year ended December 31, 2024, compared to a net loss per share of $4.61 in 2023.