Regulus reports net loss of $7.2 million for fourth quarter 2015

Feb 23 2016

Regulus Therapeutics Inc. (NASDAQ: RGLS), a biopharmaceutical company leading the discovery and development of innovative medicines targeting microRNAs, today reported financial results for the fourth quarter and full-year ended December 31, 2015 and provided a summary of recent corporate highlights.

"2015 was a milestone year for the company with the filing of three investigational new drug applications in the United States, and two clinical trial applications in the European Union," said Paul Grint, M.D., President and CEO of Regulus. "Our priorities for 2016, based on the data seen to date, include acceleration of our clinical programs, advancing our pipeline and defining the regulatory path to approval for our lead programs."

Fourth Quarter and Year-End 2015 Financial Results & Highlights

Regulus reported a net loss of $7.2 million and $55.7 million for the quarter and year ended December 31, 2015, respectively, compared to a net loss of $22.2 million and $56.7 million for the same periods in 2014. Basic and diluted net loss per share was $0.14 for the quarter ended December 31, 2015, compared to $0.47 for the same period in 2014. Basic and diluted net loss per share was $1.08 for the year ended December 31, 2015, compared to $1.29 for the same period in 2014.

Regulus recognized revenue of $10.9 million and $20.8 million for the quarter and year ended December 31, 2015, respectively, compared to $4.2 million and $7.7 million for the same periods in 2014. Revenue for the quarter and year ended December 31, 2015 included milestones earned under Regulus' strategic alliances and collaboration agreements of $10.0 million and $13.2 million, respectively, which included a $10.0 million clinical milestone payment upon AstraZeneca's first patient dosing in a first-in-human Phase I clinical study of RG-125(AZD4076). Revenue from research services performed under Regulus' strategic alliances and collaborations was $0.4 million and $4.5 million for the quarter and year ended December 31, 2015, respectively. Other revenue during these periods consisted of amortization of up-front payments from Regulus' strategic alliances and collaborations, which is recognized over the estimated period of performance.

Research and development expenses were $12.8 million and $56.4 million for the quarter and year ended December 31, 2015, respectively, compared to $10.5 million and $41.0 million for the same periods in 2014. This increase was primarily driven by clinical trial costs for RG-101, pre-clinical study costs for RG-125 and an increase in salaries and related employee costs, including non-cash stock-based compensation.

General and administrative expenses were $5.4 million and $19.1 million for the quarter and year ended December 31, 2015, respectively, compared to $3.3 million and $11.5 million for the same periods in 2014. This increase was primarily driven by an increase in salaries and related employee costs, including non-cash stock-based compensation.

As of December 31, 2015, Regulus had $115.3 million in cash, cash equivalents and short-term investments, including restricted cash of $1.3 million, and 52,669,266 shares of common stock outstanding.

Recent Highlights

RG-101 (GalNAc-conjugated anti-miR122 for the treatment of Hepatitis C Virus)

• Interim Results from Phase II Combination Study. Regulus recently announced interim results from one of the company's ongoing Phase II studies of RG-101 for the treatment of Hepatitis C Virus infection (HCV). The study was designed to evaluate a shortened, four-week treatment regimen containing a subcutaneous administration of 2 mg/kg of RG-101 at Day 1 and Day 29, in combination with 4 weeks of once/daily approved anti-viral agents Harvoni®, Olysio®, or Daklinza™. The study enrolled 79 treatment naïve genotype 1 and 4 HCV patients (Harvoni® arm, n=27, Olysio® arm, n=27, Daklinza™ arm, n=25). Thirty-eight patients have been evaluated through 8 weeks of follow up. Ninety-seven percent of those patients (37/38) had HCV RNA viral load measurements below the limit of quantification. To date, RG-101 has been generally well tolerated with the majority of adverse events considered mild or moderate, and with no study discontinuations. For those patients through 12 weeks of follow-up, 100% remained below the limit of quantification (14/14). The primary endpoint analysis (12 week follow up) for all 79 patients in the study are anticipated to be reported in late Q2 2016.
• Entered into Clinical Collaboration with GSK with Potential for Single Visit HCV Therapy. In accordance with the GSK clinical collaboration, Regulus has initiated its Phase II clinical trial evaluating the combination of RG-101 and GSK2878175, a non-nucleoside NS5B polymerase inhibitor, in HCV patients. In parallel, GSK is working to develop a long-acting parenteral "LAP" formulation of GSK2878175 as a single intra-muscular injection, providing the potential for a single-visit therapeutic treatment for HCV. Regulus anticipates reporting interim safety and efficacy data from this study by the end of 2016.
• Enrollment Nearly Complete in US Phase I Study. Enrollment is nearly complete in a multi-center, open label, non-randomized Phase I study to compare the safety, tolerability, pharmacokinetics, and pharmacodynamics of RG-101 in subjects with severe renal insufficiency or end-stage renal disease ("ESRD") to healthy control subjects, and further explore RG-101 in hepatitis C infected subjects with severe renal insufficiency or ESRD. Regulus anticipates reporting safety and efficacy data from the HCV/severe renal impairment or ESRD arm in the second half of 2016.

RG-012 (anti-miR21 for the treatment of Alport syndrome)

• Completed Phase I Study. Regulus completed a single-ascending dose, first-in-human, Phase I study evaluating the safety, tolerability and pharmacokinetics of subcutaneous dosing of RG-012 in healthy volunteers. RG-012 was well-tolerated with no serious adverse events or discontinuations reported. Regulus is scheduled to meet with the FDA towards the end of the first quarter of 2016 to discuss the Phase II program.
• Advanced ATHENA Natural History Study. Regulus continues to advance the ATHENA natural history study in patients with Alport syndrome and anticipates reporting initial observations in the second quarter of 2016 at a medical meeting. Longitudinal data obtained in the ATHENA natural history study will help inform the design of the Phase II study.

RG-125 (GalNAc-conjugated anti-miR103/107 for the treatment of NASH)

• Entered Phase I Development; Received $10.0M Milestone Payment from AstraZeneca. Dosing commenced in a first-in-human Phase I study of RG-125(AZD4076) by Regulus' collaboration partner AstraZeneca. Regulus received a $10.0 million milestone payment from AstraZeneca, who will assume all ongoing development of RG-125(AZD4076).

Additional Highlights

• Attracted Key Talent. Regulus appointed Joseph "Jay" Hagan as Chief Operating Officer, principal financial officer and principal accounting officer. Mr. Hagan is responsible for leading the company's operations and corporate development and serves as a key member of the executive leadership team.
• Received Key Patents for Lead Programs. The U.S. Patent and Trademark Office granted patents related to Regulus' most advanced microRNA therapeutics, RG-101 and RG-012, furthering the company's ability to protect its microRNA candidates.
• Achieved All Milestones in Biomarkers Collaboration with Biogen; Earned $3.7M. Regulus realized the full potential of its collaboration with Biogen to identify microRNAs as biomarkers for multiple sclerosis and earned $3.7 million in payments. The scope of the research under the current collaboration agreement has concluded.