La Jolla Pharmaceutical Company announced financial results for the three months ended March 31, 2022 and highlighted corporate progress.
Corporate Progress
- Net Product Sales: For the three months ended March 31, 2022, La Jolla’s net product sales were $10.4 million, up 21% from the same period in 2021.
- GIAPREZA U.S. Net Product Sales: For the three months ended March 31, 2022, GIAPREZA U.S. net product sales were $7.7 million, up 13% from the same period in 2021.
- XERAVA U.S. Net Product Sales: For the three months ended March 31, 2022, XERAVA U.S. net product sales were $2.7 million, up 50% from the same period in 2021.
- Positive Net Cash Provided by Operating Activities: For the three months ended March 31, 2022, La Jolla’s net cash provided by operating activities was $2.5 million compared to $17.2 million for the same period in 2021. The 2021 period included a $16.8 million net upfront payment and a $3.0 million milestone payment received in connection with the Company’s agreements with PAION AG and Everest Medicines Limited covering ex-U.S. rights to GIAPREZA and XERAVA.
“We are pleased to report that La Jolla continues to grow net product sales and generate positive operating cash flow,” said Larry Edwards, President and Chief Executive Officer of La Jolla. “La Jolla’s focus remains on growing its GIAPREZA and XERAVA franchises while increasing operating cash flow.”
Financial Results
For the three months ended March 31, 2022, La Jolla’s total revenue was $10.4 million compared to $34.1 million for the same period in 2021. The 2021 period included a $22.5 million upfront payment and a $3.0 million milestone payment received in connection with the Company’s agreements with PAION AG and Everest Medicines Limited covering ex-U.S. rights to GIAPREZA and XERAVA. For the three months ended March 31, 2022, La Jolla’s net product sales were $10.4 million compared to $8.6 million for the same period in 2021, an increase of 21%. GIAPREZA U.S. net product sales were $7.7 million for the three months ended March 31, 2022 compared to $6.8 million for the same period in 2021, an increase of 13%. XERAVA U.S. net product sales were $2.7 million for the three months ended March 31, 2022 compared to $1.8 million for the same period in 2021, an increase of 50%.
For the three months ended March 31, 2022, La Jolla’s net income was approximately $2,000, or $0.00 per diluted share, compared to $14.4 million, or $0.42 per diluted share, for the same period in 2021.
As of March 31, 2022, La Jolla had $44.6 million of cash, cash equivalents and short-term investments compared to $46.7 million as of December 31, 2021. The $2.1 million decrease in cash, cash equivalents and short-term investments is primarily due to $2.5 million of net cash provided by operating activities, offset by $5.2 million in purchases of the Company’s common stock under its stock repurchase plan. For the three months ended March 31, 2022, La Jolla’s net cash provided by operating activities was $2.5 million compared to $17.2 million for the same period in 2021. The 2021 period included a $16.8 million net upfront payment and a $3.0 million milestone payment received in connection with the Company’s agreements with PAION AG and Everest Medicines Limited covering ex-U.S. rights to GIAPREZA and XERAVA.
About GIAPREZA
GIAPREZA® (angiotensin II) injection is approved by the U.S. Food and Drug Administration (FDA) as a vasoconstrictor indicated to increase blood pressure in adults with septic or other distributive shock. GIAPREZA is approved by the European Commission (EC) for the treatment of refractory hypotension in adults with septic or other distributive shock who remain hypotensive despite adequate volume restitution and application of catecholamines and other available vasopressor therapies. GIAPREZA mimics the body’s endogenous angiotensin II peptide, which is central to the renin-angiotensin-aldosterone system, which in turn regulates blood pressure. Prescribing information for GIAPREZA is available at www.giapreza.com. The European Summary of Product Characteristics is available at www.ema.europa.eu/en/medicines/human/EPAR/giapreza. GIAPREZA is marketed in the U.S. by La Jolla Pharmaceutical Company on behalf of La Jolla Pharma, LLC, its wholly owned subsidiary, and is marketed in Europe by PAION Deutschland GmbH on behalf of La Jolla Pharma, LLC.
GIAPREZA Important Safety Information
Contraindications
None.
Warnings and Precautions
There is a potential for venous and arterial thrombotic and thromboembolic events in patients who receive GIAPREZA. Use concurrent venous thromboembolism (VTE) prophylaxis.
Adverse Reactions
The most common adverse reactions that were reported in greater than 10% of GIAPREZA-treated patients were thromboembolic events.
Drug Interactions
Angiotensin converting enzyme (ACE) inhibitors may increase response to GIAPREZA. Angiotensin II receptor blockers (ARBs) may reduce response to GIAPREZA.
You are encouraged to report negative side effects of prescription drugs to the FDA. Visit www.fda.gov/medwatch or call 1-800-FDA-1088.
For additional information, please see Full Prescribing Information for the United States and the Summary of Product Characteristics for the European Union.
About XERAVA
XERAVA® (eravacycline) for injection is approved by the U.S. Food and Drug Administration (FDA) as a tetracycline class antibacterial indicated for the treatment of complicated intra-abdominal infections (cIAI) in patients 18 years of age and older. XERAVA is approved by the European Commission (EC) for the treatment of cIAI in adults. Prescribing information for XERAVA is available at www.xerava.com. The European Summary of Product Characteristics is available at www.ema.europa.eu/en/medicines/human/EPAR/xerava. XERAVA is marketed in the U.S. by Tetraphase Pharmaceuticals, Inc., a wholly owned subsidiary of La Jolla, and is marketed in Europe by PAION Deutschland GmbH on behalf of Tetraphase Pharmaceuticals, Inc. Everest, the Company’s licensee for mainland China, Taiwan, Hong Kong, Macau, South Korea, Singapore, the Malaysian Federation, the Kingdom of Thailand, the Republic of Indonesia, the Socialist Republic of Vietnam and the Republic of the Philippines, submitted an NDA in China, which was accepted by the China National Medical Products Administration (NMPA) in March 2021. XERAVA was approved in Singapore by the Health Science Authority in April 2020.
XERAVA Important Safety Information
XERAVA is a tetracycline class antibacterial indicated for the treatment of complicated intra-abdominal infections in patients 18 years of age and older.
XERAVA is not indicated for the treatment of complicated urinary tract infections.
To reduce the development of drug-resistant bacteria and maintain the effectiveness of XERAVA and other antibacterial drugs, XERAVA should be used only to treat or prevent infections that are proven or strongly suspected to be caused by susceptible bacteria.
XERAVA is contraindicated for use in patients with known hypersensitivity to eravacycline, tetracycline-class antibacterial drugs or to any of the excipients. Life-threatening hypersensitivity (anaphylactic) reactions have been reported with XERAVA.
The use of XERAVA during tooth development (last half of pregnancy, infancy and childhood to the age of eight years) may cause permanent discoloration of the teeth (yellow-gray-brown) and enamel hypoplasia.
The use of XERAVA during the second and third trimester of pregnancy, infancy and childhood up to the age of eight years may cause reversible inhibition of bone growth.
Clostridium difficile associated diarrhea (CDAD) has been reported with use of nearly all antibacterial agents and may range in severity from mild diarrhea to fatal colitis.
The most common adverse reactions observed in clinical trials (incidence ≥ 3%) were infusion site reactions, nausea and vomiting.
XERAVA is structurally similar to tetracycline-class antibacterial drugs and may have similar adverse reactions. Adverse reactions including photosensitivity, pseudotumor cerebri and anti-anabolic action, which has led to increased blood urea nitrogen, azotemia, acidosis, hyperphosphatemia, pancreatitis and abnormal liver function tests, have been reported for other tetracycline-class antibacterial drugs, and may occur with XERAVA. Discontinue XERAVA if any of these adverse reactions are suspected.
You are encouraged to report negative side effects of prescription drugs to the FDA. Visit www.fda.gov/medwatch or call 1-800-FDA-1088.
For additional information, please see Full Prescribing Information for the United States.
About La Jolla Pharmaceutical Company
La Jolla Pharmaceutical Company is dedicated to the commercialization of innovative therapies that improve outcomes in patients suffering from life-threatening diseases. GIAPREZA® (angiotensin II) injection is approved by the FDA as a vasoconstrictor indicated to increase blood pressure in adults with septic or other distributive shock. XERAVA® (eravacycline) for injection is approved by the FDA as a tetracycline class antibacterial indicated for the treatment of complicated intra-abdominal infections (cIAI) in patients 18 years of age and older. For more information, please visit www.ljpc.com.
Forward-looking Statements
This press release contains “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. We caution investors that forward-looking statements are based on management’s expectations and assumptions as of the date of this press release and involve substantial risks and uncertainties that could cause the actual outcomes to differ materially from what we currently expect. These risks and uncertainties include, but are not limited to, those associated with: GIAPREZA® (angiotensin II) and XERAVA® (eravacycline) sales; operating costs; regulatory actions relating to La Jolla’s products by the U.S. FDA, European Commission, China National Medical Products Administration and/or other regulatory authorities; expected future cash flows of La Jolla, including upfront, milestone, royalty and other payments resulting from La Jolla’s out-license agreements and commercial supply agreements; and other risks and uncertainties identified in our filings with the U.S. Securities and Exchange Commission. Forward-looking statements in this press release apply only as of the date made, and we undertake no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances.
| LA JOLLA PHARMACEUTICAL COMPANY Condensed Consolidated Balance Sheets (in thousands, except par value and share amounts) | ||||||||
| March 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 44,169 | $ | 46,668 | ||||
| Short-term investments | 390 | - | ||||||
| Accounts receivable, net | 5,729 | 8,610 | ||||||
| Inventory, net | 7,113 | 6,281 | ||||||
| Prepaid expenses and other current assets | 5,518 | 5,756 | ||||||
| Total current assets | 62,919 | 67,315 | ||||||
| Goodwill | 20,123 | 20,123 | ||||||
| Intangible assets, net | 12,933 | 13,321 | ||||||
| Right-of-use lease assets | 275 | 318 | ||||||
| Property and equipment, net | 88 | 113 | ||||||
| Restricted cash | 40 | 40 | ||||||
| Total assets | $ | 96,378 | $ | 101,230 | ||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 2,789 | $ | 2,278 | ||||
| Accrued expenses | 4,297 | 4,866 | ||||||
| Accrued interest expense on deferred royalty obligation, current portion | 5,957 | 5,163 | ||||||
| Deferred revenue | 2,849 | 2,849 | ||||||
| Paycheck Protection Program loan | - | 2,325 | ||||||
| Lease liabilities, current portion | 156 | 154 | ||||||
| Total current liabilities | 16,048 | 17,635 | ||||||
| Deferred royalty obligation, net | 124,519 | 124,503 | ||||||
| Accrued interest expense on deferred royalty obligation, less current portion | 25,262 | 24,590 | ||||||
| Lease liabilities, less current portion | 120 | 164 | ||||||
| Fair value of contingent value rights | 923 | 1,076 | ||||||
| Total liabilities | 166,872 | 167,968 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ deficit: | ||||||||
| Common Stock, $0.0001 par value; 100,000,000 shares authorized, 25,663,667 and 26,783,544 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively | 3 | 3 | ||||||
| Series C-12 Convertible Preferred Stock, $0.0001 par value; 11,000 shares authorized, 3,906 shares issued and outstanding at March 31, 2022 and December 31, 2021; and liquidation preference of $3,906 at March 31, 2022 and December 31, 2021 | 3,906 | 3,906 | ||||||
| Additional paid-in capital | 982,687 | 986,445 | ||||||
| Accumulated deficit | (1,057,090 | ) | (1,057,092 | ) | ||||
| Total stockholders’ deficit | (70,494 | ) | (66,738 | ) | ||||
| Total liabilities and stockholders’ deficit | $ | 96,378 | $ | 101,230 | ||||
| LA JOLLA PHARMACEUTICAL COMPANY Condensed Consolidated Statements of Operations (Unaudited) (in thousands, except per share amounts) | ||||||||
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2022 | 2021 | |||||||
| Revenue | ||||||||
| Net product sales | $ | 10,409 | $ | 8,637 | ||||
| License and other revenue | 16 | 25,500 | ||||||
| Total revenue | 10,425 | 34,137 | ||||||
| Operating expenses | ||||||||
| Cost of product sales | 2,165 | 2,731 | ||||||
| Cost of license and other revenue | 5 | 3,600 | ||||||
| Selling, general and administrative | 10,274 | 8,755 | ||||||
| Research and development | 27 | 1,558 | ||||||
| Total operating expenses | 12,471 | 16,644 | ||||||
| (Loss) income from operations | (2,046 | ) | 17,493 | |||||
| Other income (expense) | ||||||||
| Interest expense | (2,402 | ) | (2,609 | ) | ||||
| Gain on forgiveness of Paycheck Protection Program loan | 2,325 | - | ||||||
| Other income—related party | 1,583 | - | ||||||
| Other income (expense) | 543 | (448 | ) | |||||
| Total other income (expense), net | 2,049 | (3,057 | ) | |||||
| Income before income taxes | 3 | 14,436 | ||||||
| Provision for income taxes | 1 | 18 | ||||||
| Net income | $ | 2 | $ | 14,418 | ||||
| Earnings per share | ||||||||
| Basic | $ | 0.00 | $ | 0.53 | ||||
| Diluted | $ | 0.00 | $ | 0.42 | ||||
| Shares used in computing earnings per share | ||||||||
| Basic | 26,163 | 27,427 | ||||||
| Diluted | 32,916 | 34,183 | ||||||
| LA JOLLA PHARMACEUTICAL COMPANY Condensed Consolidated Statements of Cash Flows (Unaudited) (in thousands) | ||||||||
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2022 | 2021 | |||||||
| Operating activities | ||||||||
| Net income | $ | 2 | $ | 14,418 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Non-cash interest expense | 1,482 | 1,736 | ||||||
| Share-based compensation expense | 1,262 | 1,116 | ||||||
| Amortization of intangible assets | 388 | 388 | ||||||
| Amortization of right-of-use lease assets | 43 | 46 | ||||||
| Depreciation expense | 25 | 29 | ||||||
| Loss on short-term investments | 309 | - | ||||||
| Gain on forgiveness of Paycheck Protection Program loan | (2,325 | ) | - | |||||
| Gain on sale of non-controlling equity interest | (699 | ) | - | |||||
| (Gain) loss on change in fair value of contingent value rights | (153 | ) | 450 | |||||
| Inventory fair value step-up adjustment included in cost of product sales | - | 850 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable, net | 2,881 | 1,681 | ||||||
| Inventory, net | (832 | ) | (211 | ) | ||||
| Prepaid expenses and other current assets | 238 | (2,716 | ) | |||||
| Accounts payable | 511 | (1,664 | ) | |||||
| Accrued expenses | (569 | ) | 1,101 | |||||
| Lease liabilities | (42 | ) | (46 | ) | ||||
| Net cash provided by operating activities | 2,521 | 17,178 | ||||||
| Investing activities | ||||||||
| Net cash provided by (used for) investing activities | - | - | ||||||
| Financing activities | ||||||||
| Purchases of common stock under Stock Repurchase Plan | (5,179 | ) | - | |||||
| Net proceeds from issuance of common stock under ESPP | 159 | 81 | ||||||
| Net proceeds from issuance of common stock under 2013 Equity Plan | - | 154 | ||||||
| Net cash (used for) provided by financing activities | (5,020 | ) | 235 | |||||
| Net (decrease) increase in cash, cash equivalents and restricted cash | (2,499 | ) | 17,413 | |||||
| Cash, cash equivalents and restricted cash, beginning of period | 46,708 | 21,261 | ||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 44,209 | $ | 38,674 | ||||
| Supplemental disclosure of non-cash investing and financing activities | ||||||||
| Sale of non-controlling equity interest | $ | 699 | $ | - | ||||
| Forgiveness of Paycheck Protection Program loan | $ | 2,325 | $ | - | ||||
| Reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheets | ||||||||
| Cash and cash equivalents | $ | 44,169 | $ | 38,634 | ||||
| Restricted cash | 40 | 40 | ||||||
| Total cash, cash equivalents and restricted cash | $ | 44,209 | $ | 38,674 | ||||
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La Jolla Pharmaceutical Company Contact
Michael Hearne
Chief Financial Officer
La Jolla Pharmaceutical Company
(617) 715-3598
mhearne@ljpc.com
Source: La Jolla Pharmaceutical Company
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