WESTLAKE VILLAGE, Calif., Nov. 08, 2022 (GLOBE NEWSWIRE) — Arcutis Biotherapeutics, Inc. (Nasdaq: ARQT), an early commercial-stage biopharmaceutical company focused on developing meaningful innovations in immuno-dermatology, today reported financial results for the quarter ended September 30, 2022, and provided a business update.
“This quarter represented a transformational period for Arcutis, with the FDA approval and launch of ZORYVE delivering on our promise to bring meaningful innovation to patients, physicians, and shareholders, and cementing our commitment to access and affordability. Furthermore, the acquisition of Ducentis extends our continued evolution into the preeminent immuno-dermatology company,” said Frank Watanabe, Arcutis’ President and Chief Executive Officer. “Our launch of ZORYVE in plaque psoriasis continues to accelerate, and we believe it will be a foundational driver of growth for Arcutis that will be further buoyed by each additional topical roflumilast development program we advance towards potential commercialization. We are well funded, affording us the flexibility to properly invest in the ZORYVE launch, and also to progress our early pipeline assets like ARQ-255 into the clinic.”
Program Updates / Key Milestones
ZORYVE (roflumilast cream) – a highly potent and selective phosphodiesterase-4 (PDE4) inhibitor in a once-daily cream formulation, approved in the U.S. for the treatment of plaque psoriasis and under development for atopic dermatitis
Roflumilast foam – a once-daily foam formulation of topical roflumilast designed to overcome the challenges of delivering topical drugs in hair-bearing areas of the body, being developed as a potential treatment for seborrheic dermatitis and scalp and body psoriasis
ARQ-252 – a topical cream formulation of a small molecule inhibitor of Janus kinase type 1 (JAK1), being developed as a potential treatment for chronic hand eczema, vitiligo, and other inflammatory dermatoses
ARQ-255 – an alternative topical formulation of ARQ-252 designed to reach deeper into the skin in order to potentially treat alopecia areata
Recent Corporate Highlights
Third Quarter 2022 Summary Financial Results
Product revenues, net for the quarter ended September 30, 2022 related to sales of ZORYVE were $0.7 million. In addition to strong patient demand, about half of the net product revenues for the quarter related to wholesalers’ inventory build at launch.
Cost of sales for the quarter ended September 30, 2022 were $0.3 million driven primarily by the amortization of a milestone payment to AstraZeneca.
Research and development (R&D) expenses for the quarter ended September 30, 2022 were $69.7 million compared to $40.6 million for the corresponding period in 2021. The year-over-year increase was primarily due to the approximately $30 million upfront expense for the Ducentis acquisition.
Selling, general, and administrative (G&A) expenses for the quarter ended September 30, 2022 were $35.5 million compared to $16.5 million for the corresponding period in 2021. The year-over-year increase was primarily due to higher headcount and professional services expenses related to the launch of ZORYVE.
Net loss was $107.7 million, or $1.89 per basic and diluted share, for the quarter ended September 30, 2022 compared to $57.0 million, or $1.14 per basic and diluted share, for the corresponding period in 2021. The Ducentis acquisition contributed $0.51 to the net loss per share in the third quarter of 2022.
Cash, cash equivalents, restricted cash, and marketable securities were $478.2 million as of September 30, 2022, compared to $388.6 million as of December 31, 2021. The year-over-year increase includes the $162 million in net proceeds from the August 2022 public offering, as well as the $125 million drawn from the existing debt facility with SLR Capital Partners upon the ZORYVE approval in plaque psoriasis. Net cash used in operating activities during the third quarter was $67.7 million.
Conference Call and Webcast
Arcutis management will host a conference call and webcast today at 5:00pm ET to discuss the financial results for the quarter and provide a business update. The webcast for this conference call may be accessed at the “Events” section of the Company’s website. The replay of the webcast will be available on the Arcutis website following the call.
Arcutis Biotherapeutics, Inc. (Nasdaq: ARQT) is a medical dermatology company that champions meaningful innovation to address the urgent needs of patients living with immune-mediated dermatological diseases and conditions. With a commitment to solving the most persistent patient challenges in dermatology, Arcutis harnesses our unique dermatology development platform coupled with our dermatology expertise to build differentiated therapies against biologically validated targets. Arcutis’ dermatology development platform includes a robust pipeline with multiple clinical programs for a range of inflammatory dermatological conditions including plaque psoriasis, atopic dermatitis, and seborrheic dermatitis. For more information, visit www.arcutis.com or follow Arcutis on LinkedIn, Facebook, and Twitter.
Forward Looking Statements
This press release contains “forward-looking” statements, including, among others, statements regarding the potential for its topical drugs in development to address large markets with significant unmet need; the development, approval and potential commercialization of Arcutis’ product candidates; expectations with regard to the timing of and successful clinical trial results anticipated during 2022; the potential commercial success and growth of ZORYVE in plaque psoriasis; and the timing of regulatory filings for a number of dermatology indications for roflumilast in the U.S. and Canada. These statements involve substantial known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements and you should not place undue reliance on our forward-looking statements. Risks and uncertainties that may cause our actual results to differ include risks inherent in the clinical development process and regulatory approval process, the timing of regulatory filings, the timing, expenses, and success of our commercialization efforts, including uncertainty of future commercial sales and related items that can impact net sales, and our ability to defend our intellectual property. For a further description of the risks and uncertainties applicable to our business, see the “Risk Factors” section of our Form 10-K filed with U.S. Securities and Exchange Commission (SEC) on February 22, 2022 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, as well as any subsequent filings with the SEC. We undertake no obligation to revise or update information herein to reflect events or circumstances in the future, even if new information becomes available.
Amanda Sheldon, Head of Corporate Communications
Eric McIntyre, Head of Investor Relations
ARCUTIS BIOTHERAPEUTICS, INC.
Condensed Balance Sheets
|September 30,||December 31,|
|Cash and cash equivalents||$||81,543||$||96,449|
|Trade receivable, net||2,431||—|
|Prepaid expenses and other current assets||11,784||14,172|
|Total current assets||496,719||402,773|
|Property and equipment, net||1,939||2,261|
|Intangible assets, net||7,375||—|
|Operating lease right-of-use asset||2,803||3,040|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Operating lease liability||639||433|
|Total current liabilities||37,102||33,326|
|Operating lease liability, noncurrent||4,285||4,774|
|Long-term debt, net||196,753||72,350|
|Other long-term liabilities||—||25|
|Additional paid-in capital||920,109||706,233|
|Accumulated other comprehensive loss||(1,596||)||(255||)|
|Total stockholders’ equity||270,774||297,677|
|Total liabilities and stockholders’ equity||$||508,914||$||408,152|
ARCUTIS BIOTHERAPEUTICS, INC.
Condensed Statements of Operations
(In thousands, except share and per share data)
|Three Months Ended September 30,||Nine Months Ended September 30,|
|Product revenue, net||$||725||$||—||$||725||$||—|
|Cost of sales||269||—||269||—|
|Research and development||69,731||40,604||148,558||93,000|
|Selling, general, and administrative||35,473||16,474||85,101||42,243|
|Total operating expenses||105,473||57,078||233,928||135,243|
|Loss from operations||(104,748||)||(57,078||)||(233,203||)||(135,243||)|
|Other income (expense):|
|Other income, net||1,938||98||2,501||213|
|Total other income (expense)||(2,961||)||98||(6,236||)||213|
|Per share information:|
|Net loss per share, basic and diluted||$||(1.89||)||$||(1.14||)||$||(4.52||)||$||(2.75||)|
|Weighted-average shares used in computing net loss per share, basic and diluted||57,091,743||50,097,851||53,028,962||49,136,768|