AcelRx Pharmaceuticals, Inc. (Nasdaq: ACRX), ("AcelRx"), a specialty pharmaceutical company focused on the development and commercialization of innovative therapies for the treatment of acute and breakthrough pain, today reported financial results for the fourth quarter and year ended December 31, 2011.
Net loss for the fourth quarter of 2011 was $6.4 million, or $0.33 per share, compared with a net loss of $3.5 million, or $5.23 per share, for the fourth quarter of 2010. Common shares used in calculating basic and diluted earnings per share were 19,568,000 for the fourth quarter of 2011 compared to 674,000 common shares for the fourth quarter of 2010.
During the fourth quarter of 2011, AcelRx recognized revenue of $624,000 resulting from reimbursement for work completed under a research grant from the US Army Medical Research and Material Command, or USAMRMC, for development of its ARX-04 product candidate, a Sufentanil NanoTab® for the treatment of moderate-to-severe acute pain.
Research and development expenses for the quarter ended December 31, 2011 totaled $4.7 million, compared with $1.9 million for the quarter ended December 31, 2010. The increase was primarily due to development expenses for ARX-01, the Sufentanil NanoTab PCA System, AcelRx's lead product candidate for the treatment of post-operative pain, as AcelRx prepared for the initiation of Phase 3 clinical trials which began in early March 2012.
General and administrative expenses were $1.7 million for the quarter ended December 31, 2011, compared with $1.0 million for the quarter ended December 31, 2010. The increase resulted primarily from expenses associated with AcelRx's operation as a public company.
For the year ended December 31, 2011, AcelRx reported a net loss of $20.1 million, or $1.16 per share, compared with a net loss of $14.3 million, or $21.84 per share, for the same period in 2010. Common shares used in calculating basic and diluted earnings per share were 17,345,000 for the year ended December 31, 2011 compared to 657,000 common shares for the year ended December 31, 2010.
As of December 31, 2011, AcelRx had cash, cash equivalents and investments of $35.8 million, compared to $32.0 million at September 30, 2011 and $3.7 million at December 31, 2010. In February 2011, AcelRx completed its initial public offering, resulting in net proceeds to AcelRx of $34.9 million. In June 2011, AcelRx entered into a $20.0 million secured loan agreement with Hercules Technology Growth Capital, or Hercules. Upon execution of the agreement, AcelRx received $10.0 million in the first tranche of the loan and, in December 2011, AcelRx drew down the second $10.0 million tranche of the loan.
"During the last quarter of 2011 and into the first quarter of 2012, AcelRx completed system verification testing, software validation testing and reprocessing validation testing of our ARX-01 device, in addition to filing a new IND for our ARX-04 product candidate. In early March 2012, AcelRx accomplished a major milestone with the initiation of our first Phase 3 efficacy and safety study for ARX-01 for the treatment of post-operative pain following open abdominal surgery. Shortly, we will be initiating the second Phase 3 study, an active comparator study comparing ARX-01 to the standard of care. These studies, along with the third and final Phase 3 study to support an NDA for ARX-01 due to start in the second half of this year, will set up a very exciting 2012 with data from all three studies expected by early 2013," said Richard King, President and CEO of AcelRx.
Development Update
- In early March 2012, AcelRx initiated the first of three planned ARX-01 Phase 3 studies. This study is a randomized, double-blind, placebo-controlled efficacy and safety trial in adults following open abdominal surgery. Approximately 150 adults, randomized 2:1 to active or placebo treatment groups, will be treated for post-operative pain for 48 - 72 hours after randomization.
- A second Phase 3 study is planned as an open-label, active-comparator study comparing ARX-01 to the current standard of care, intravenous patient-controlled analgesia, with morphine. The primary endpoint for this study will assess a measure of efficacy, Global Patient Satisfaction over the 48-hour study period, and will compare ratings of "Good" and "Excellent" for Global Patient Satisfaction between the two groups in a non-inferiority comparison.
- The third and final planned Phase 3 clinical study is a randomized, double-blind, placebo-controlled efficacy and safety study comparing ARX-01 to placebo for post-operative pain control following major joint replacement surgery.
Financial Outlook
AcelRx anticipates that research and development expenses will increase significantly over the next several quarters as AcelRx seeks to complete Phase 3 clinical development of ARX-01. The development of ARX-04 beyond Phase 2 and initial preparations for Phase 3 are dependent on the identification of sources of additional funding from the USAMRMC or the identification of a partner to support these efforts. Additionally, AcelRx anticipates modest increases in general and administrative expenses due to costs associated with operating as a public company and expansion of its corporate infrastructure to support ongoing development of its product candidates.
AcelRx believes its current cash, cash equivalents and investments are sufficient to fund operations into the first quarter of 2013.
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