Company Update (NASDAQ:MACK): Merrimack Pharmaceuticals Inc Reports 2Q:15 Financial Results


Merrimack Pharmaceuticals Inc (NASDAQ:MACK), a biopharmaceutical company discovering, developing and preparing to commercialize innovative medicines paired with companion diagnostics for the treatment of cancer, today announced its second quarter 2015 financial results. Merrimack will host a live conference call and webcast today, Monday, August 10 at 4:30 p.m., Eastern time, to provide an update on Merrimack’s progress as well as a summary of these results.

Key Recent Events

  • Acceptance of New Drug Application (NDA) and receipt of Priority Review designation by the U.S. Food and Drug Administration (FDA) for MM-398 with a goal of October 24, 2015 as the action date for the NDA under the Prescription Drug User Fee Act (PDUFA date);
  • Expansion of MM-398 imaging study to metastatic breast cancer;
  • Addition, effective August 11, 2015, of Dr. Yasir Al-Wakeel as Chief Financial Officer and head of Corporate Development; and
  • Addition of John Dineen, former CEO of GE Healthcare, to its Board of Directors.

Upcoming Milestones

Merrimack anticipates the following milestones in 2015:

  • MM-398 NDA PDUFA date of October 24, 2015;
  • Commercial launch of MM-398, pending approval by the FDA;
  • Initiation of a clinical trial of MM-398 in front-line metastatic pancreatic cancer;
  • Initiation of a clinical trial of MM-398 in front-line HER2-negative gastric cancer;
  • Initiation of a clinical trial of MM-151 in EGFR-positive colorectal cancer;
  • Continued enrollment in HERMIONE, a Phase 2 clinical trial designed to support a potential Accelerated Approval application to the FDA for MM-302 in patients with HER2-positive metastatic breast cancer;
  • Continued enrollment in a Phase 2 clinical trial of MM-121 in patients with heregulin-positive, locally advanced or metastatic non-small cell lung cancer; and
  • Continued enrollment in a Phase 2 clinical trial of MM-141 in patients with front-line metastatic pancreatic cancer who have high serum levels of free IGF-1.

Second Quarter 2015 Financial Results

Revenue for the second quarter of 2015 was $36.6 million compared with revenue of $27.8 million for the second quarter of 2014, an increase of $8.7 million or 31%.  This increase was attributable to $36.6 million of revenue recognized related to Merrimack’s collaboration with Baxalta during the second quarter of 2015, including $20.0 million of non-recurring revenue recognized related to a milestone that was achieved when the European Medicines Agency (EMA) accepted for review a Marketing Authorization Application (MAA) filed by Baxalta for MM-398.  This increase was offset by$27.8 million of decreased revenue due to the termination of Merrimack’s collaboration with Sanofi effective December 17, 2014.

Research and development expenses increased $9.0 million over the corresponding quarter of the preceding year.  This increase was primarily attributable to $10.6 million of increased MM-398 expenses, primarily due to costs associated with a non-recurring $11.0 million milestone event that was incurred in the second quarter of 2015 and paid in July 2015 related to the EMA accepting for review an MAA filed by Baxalta for MM-398.

General and administrative expenses increased $4.4 million over the corresponding quarter of the preceding year.  This increase was primarily attributable to increased infrastructure and personnel expenses as Merrimack prepares for the potential commercialization of MM-398 and increased facility-related costs.

Merrimack’s net loss for the second quarter of 2015 was $22.9 million, or basic and diluted net loss per share available to common stockholders of$0.21, as compared to a net loss for the second quarter of 2014 of $18.3 million, or basic and diluted net loss per share available to common stockholders of $0.17.

Financial Outlook

Merrimack expects to be able to fund operations into 2016 through its unrestricted cash and cash equivalents and available-for-sale securities of $67.7 million as of June 30, 2015, anticipated cost sharing reimbursements from Baxalta and the anticipated receipt of $51.5 million of net milestones related to MM-398 from Baxalta in 2015, after offsetting payments to PharmaEngine.  Any cash inflows from Merrimack’s at-the-market (ATM) offering program, business development, sales of MM-398, if it receives marketing approval, and any additional net milestones related to MM-398 that Merrimack receives from Baxalta in 2016, after offsetting milestone payments to PharmaEngine, would provide further funding for Merrimack’s operations.

Upcoming Investor Conferences

Merrimack will attend the following investor conferences this fall:

  • Citi’s 10th Annual Biotech Conference on September 9-10 in New York; and
  • Credit Suisse Healthcare Conference on November 9-11 in Scottsdale, AZ. (Original Source)

Shares of Merrimack Pharmaceuticals closed today at $9.53, up $0.01 or 0.11%. MACK has a 1-year high of $13.84 and a 1-year low of $6.18. The stock’s 50-day moving average is $11.19 and its 200-day moving average is $11.39.

On the ratings front, Cantor analyst Daniel Brims maintained a Buy rating on MACK, with a price target of $16, in a report issued on June 15. The current price target implies an upside of 68.2% from current levels. According to TipRanks.com, Brims has a total average return of 1.0%, a 36.4% success rate, and is ranked #2111 out of 3728 analysts.

Merrimack Pharmaceuticals Inc is engaged in discovering, developing and preparing to commercialize medicines consisting of novel therapeutics paired with companion diagnostics for the treatment of cancer.