Arrowhead Reports Fiscal 2016 Year End Results

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Arrowhead Reports Fiscal 2016 Year...

– Conference Call and Webcast Today at 4:30 p.m. EST

PASADENA, Calif.–(BUSINESS WIRE)–

Arrowhead Pharmaceuticals, Inc. (NASDAQ: ARWR) today announced financial

results for its fiscal 2016 fourth quarter and year ended September 30,

2016. The company is hosting a conference call at 4:30 p.m. EST to

discuss results.

Conference Call and Webcast Details

Investors may access a live audio webcast on the Company’s website at http://ir.arrowheadpharma.com/events.cfm.

For analysts that wish to participate in the conference call, please

dial 855-215-6159 or 315-625-6887 and enter Conference ID 33791749.

A replay of the webcast will be available on the company’s website

approximately two hours after the conclusion of the call and will remain

available for 90 days. An audio replay will also be available

approximately two hours after the conclusion of the call and will be

available for 3 days. To access the audio replay, dial 404-537-3406 and

enter Conference ID 33791749.

Selected Fiscal 2016 and Recent Events

  • Discontinued development of ARC-520, ARC-521, and ARC-AAT in November

    2016

    • The Company announced that it would be discontinuing these

      clinical programs, which utilized the intravenously administered

      DPCivTM, or EX1, delivery vehicle, and

      redeploying its resources and focus toward utilizing the Company’s

      new proprietary subcutaneous and extra-hepatic delivery systems

    • The decision to discontinue development of EX1-containing programs

      was based primarily on two factors:

      • During ongoing discussions with regulatory agencies and

        outside experts, it became apparent that there would be

        substantial delays in all clinical programs that utilize EX1,

        while the Company further explored the cause of deaths in a

        non-clinical toxicology study in non-human primates exploring

        doses of EX1 higher than those planned to be used in humans

      • The Company has made substantial advances in RNA chemistry and

        targeting resulting in large potency gains for subcutaneous

        administered and extra-hepatic RNAi-based development programs

    • Because of the discontinuation of its existing clinical programs,

      the Company also reduced its workforce by approximately 30%, while

      maintaining resources necessary to support current and potential

      partner-based programs and the Company’s pipeline

  • Entered into two collaboration and license agreements with Amgen

    • Total deal value of up to $673.5 million

    • Arrowhead received $56.5 million upfront:

      • $35 million in upfront cash payments, $21.5 million equity

        investment

    • Up to low double-digit royalties for ARO-LPA and single-digit

      royalties for the undisclosed target, ARO- AMG1

    • Amgen receives:

      • Exclusive license to ARO-LPA program

      • Option for an additional candidate against an undisclosed

        target, ARO- AMG1

    • Amgen will be wholly responsible for funding and conducting all

      clinical development and commercialization

  • Continued progress on preclinical candidates including ARO-HBV,

    ARO-AAT, ARO-F12, ARO-LPA, and ARO-HIF2

    • Regarding ARO-F12 and ARO-LPA:

      • Presented preclinical data at the American Heart Association’s

        Scientific Sessions 2016 for two development programs using

        Arrowhead’s proprietary subcutaneous delivery platform:

      • RNAi triggers against Factor 12 (F12) showed dose dependent

        reductions in serum F12

      • A statistically significant reduction (p=0.002) in thrombus

        weight was observed at greater than 95% F12 knockdown in a rat

        arterio-venous shunt model

      • There was no increased bleeding risk in ARO- F12-treated mice,

        even with greater than 99% knockdown of F12 levels

      • RNAi triggers against Lipoprotein (a) [Lp(a)] led to greater

        than 98% maximum knockdown after a single 3 mg/kg SQ dose in

        Transgenic mice

      • In an atherosclerosis model, data suggest that RNAi triggers

        can be effectively delivered to a fatty liver using the

        subcutaneous delivery platform

    • Regarding ARO-HIF2

      • Presented preclinical data showing that ARO-HIF2 inhibited

        renal cell carcinoma growth and promoted tumor cell death in

        its preclinical studies

  • Strengthened the Company’s balance sheet with August 2016 private

    offering and Amgen agreement upfront payments

    • In August 2016, the Company sold 7.6 million shares of Common

      Stock to certain institutional investors and received net proceeds

      of approximately $43.2 million

    • As part of the collaboration and license agreements as well as a

      Common Stock Purchase Agreement with Amgen, $14 million of the

      total $56.5 million upfront cash payments and equity investments

      were received in September 2016, and the remaining $42.5 million

      was received in November 2016

  • Continued progress on former drug candidates prior to the

    discontinuations

    • Presented preclinical and clinical data on former drug candidate

      ARC-AAT at the Liver Meeting

    • In a first-in-human clinical study, ARC-AAT was well tolerated and

      induced deep and durable reduction of the target AAT protein

    • The preclinical data suggest a possible improvement of liver

      health and arrest of further damage from treatment with ARC-AAT

    • Advanced former drug candidate ARC-521 into a Phase 1/2 study

    • Conducted multiple dose and combination studies of former drug

      candidate ARC-520

Selected Fiscal 2016 Year End Financial Results

 

ARROWHEAD PHARMACEUTICALS, INC.

CONSOLIDATED FINANCIAL INFORMATION

 

 

Year Ended September 30

OPERATING SUMMARY

2016

2015

 

REVENUE

$

158,333

$

382,000

OPERATING EXPENSES

Research and development

41,454,452

47,267,361

Acquired in-process research and development

–

10,142,786

Salaries and payroll-related costs

19,461,656

16,554,008

General and administrative expenses

9,940,737

7,931,184

Stock-based compensation

11,595,816

10,232,897

Depreciation and amortization

3,260,045

2,336,207

Impairment expense

2,050,817

–

Contingent consideration – fair value adjustments

 

(5,862,464

)

 

1,891,533

TOTAL OPERATING EXPENSES

 

81,901,059

 

96,355,976

OPERATING LOSS

(81,742,726

)

(95,973,976

)

OTHER INCOME/(EXPENSE), PROVISION FOR INCOME TAXES

 

19,724

 

4,033,094

NET LOSS

$

(81,723,002

)

$

(91,940,882

)

 

EARNINGS PER SHARE (BASIC AND DILUTED):

$

(1.34

)

$

(1.60

)

WEIGHTED AVERAGE SHARES OUTSTANDING

 

61,050,880

 

57,358,442

 

FINANCIAL POSITION SUMMARY

September 30,

2016

2015

CASH AND CASH EQUIVALENTS

85,366,448

81,214,354

SHORT-TERM INVESTMENTS

 

–

 

17,539,902

TOTAL CASH RESOURCES (CASH, CASH EQUIVALENTS AND INVESTMENTS)

85,366,448

98,754,256

OTHER ASSETS

 

42,810,057

 

33,513,658

TOTAL ASSETS

 

128,176,505

 

132,267,914

TOTAL LIABILITIES

33,152,246

22,646,280

TOTAL STOCKHOLDERS’ EQUITY

 

95,024,259

 

109,621,634

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

128,176,505

 

132,267,914

 

SHARES OUTSTANDING

69,746,685

59,544,677

PROFORMA SHARES OUTSTANDING (INCLUDING CONVERSION OF PREFERRED

SHARES)

72,417,675

62,215,667

 

About Arrowhead Pharmaceuticals

Arrowhead Pharmaceuticals develops medicines that treat intractable

diseases by silencing the genes that cause them. Using a broad portfolio

of RNA chemistries and efficient modes of delivery, Arrowhead therapies

trigger the RNA interference mechanism to induce rapid, deep, and

durable knockdown of target genes. RNA interference, or RNAi, is a

mechanism present in living cells that inhibits the expression of a

specific gene, thereby affecting the production of a specific protein.

Arrowhead’s RNAi-based therapeutics leverage this natural pathway of

gene silencing.

For more information, please visit www.arrowheadpharma.com,

or follow us on Twitter @ArrowheadPharma.

To be added to the Company’s email list and receive news directly,

please visit http://ir.arrowheadpharma.com/alerts.cfm.

Safe Harbor Statement under the Private Securities Litigation Reform

Act:

This news release contains forward-looking statements within the

meaning of the “safe harbor” provisions of the Private Securities

Litigation Reform Act of 1995. These statements are based upon our

current expectations and speak only as of the date hereof. Our actual

results may differ materially and adversely from those expressed in any

forward-looking statements as a result of various factors and

uncertainties, including the safety and efficacy of our product

candidates, the duration and impact of regulatory delays in our clinical

programs, our ability to finance our operations, the future success of

our scientific studies, our ability to successfully develop drug

candidates, the timing for starting and completing clinical trials,

rapid technological change in our markets, and the enforcement of our

intellectual property rights. Our most recent Annual Report on Form 10-K

and subsequent Quarterly Reports on Form 10-Q discuss some of the

important risk factors that may affect our business, results of

operations and financial condition. We assume no obligation to update or

revise forward-looking statements to reflect new events or circumstances.

Source: Arrowhead Pharmaceuticals, Inc.

Contacts:
Arrowhead Pharmaceuticals, Inc.
Vince

Anzalone, CFA
626-304-3400
ir@arrowheadpharma.com
or
Investor

Relations:
The Trout Group
Chad Rubin
646-378-2947
ir@arrowheadpharma.com
or
Media:
Russo

Partners
Matt Middleman, M.D.
212-845-4272
matt.middleman@russopartnersllc.com

Source: Arrowhead Pharmaceuticals, Inc.

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