Relypsa Inc (NASDAQ:RLYP), a biopharmaceutical company, today reported financial results for the fourth quarter and year ended December 31, 2015 and announced other corporate updates.
“2015 was a pivotal year for Relypsa with the FDA approval of Veltassa marking our transition to a fully integrated commercial-stage company. We are proud to be among those who have the privilege of delivering a new medicine to people in need and the opportunity to transform the treatment of a condition that has long been a challenge for doctors,” said John A. Orwin, president and chief executive officer of Relypsa. “We are looking forward to another exciting year. We are very pleased with the initial demand for Veltassa and, following a positive meeting with the FDA, plan to submit a sNDA requesting a label change based on the results of the Phase 1 drug-drug interaction studies.”
2015 Business Highlights
- Veltassa® (patiromer) for oral suspension was approved by the U.S. Food and Drug Administration (FDA) for the treatment of hyperkalemia on October 21, 2015 and became available for prescription to patients on December 21, 2015.
- In August 2015, Relypsa announced an exclusive collaboration and license agreement with Vifor Fresenius Medical Care Renal Pharma (VFMCRP) for the development and commercialization of Veltassa outside the United States and Japan. Relypsa also announced a co-detailing agreement with Sanofi for promotion of Veltassa in the United States.
- The company experienced significant growth during this transformative year, adding almost 300 employees, including a sales force of 133 representatives, to support the launch of Veltassa.
Encouraging Initial Demand for Veltassa
Initial demand for Veltassa has been encouraging. Since Veltassa became available on December 21, 2015 through February 12, 2016, 1,229 new outpatient prescriptions were written for Veltassa and received by the company’s hub, Veltassa Konnect. The number of patients who received a free starter-supply of Veltassa, outpatient prescriptions filled and hospital units sold since the launch on December 21, 2015 through February 12, 2016 are detailed below.
February 12, 2016
units sold (non-
These numbers have not been verified by any third party and represent Relypsa’s estimates as of the date indicated. The company assumes no obligation to update them.
Progress With Payers
On February 11, 2016, the Centers for Medicare and Medicaid Services (CMS) published its Current Year (CY) 2016 Formulary Reference File (FRF) and Veltassa had been included. This was a significant development as it provides confirmation that CMS will reimburse Medicare Part D plans for Veltassa.
In addition, agreements have been signed with Express Scripts and CVS Caremark, the two largest pharmacy benefit managers in the United States.
- Relypsa has shared and discussed the results of the recently announced Phase 1 drug-drug interaction studies with the FDA. Based on the discussion,Relypsa plans to submit a sNDA by mid-2016 to the FDA requesting a label change for Veltassa.
- Relypsa and VFMCRP are on track to submit a Marketing Authorization Application (MAA) for Veltassa for the treatment of hyperkalemia to the European Medicines Agency (EMA) in the first half of 2016.
- Relypsa is initiating a new Phase 4 clinical study of Veltassa called the TOURMALINE study, which will evaluate Veltassa’s safety and efficacy when given with and without food.
- The company is also considering additional Phase 4 studies assessing Veltassa’s safety and efficacy in other patient populations, potentially including a study with patients with resistant hypertension and a study with hemodialysis patients.
- Relypsa also has a post-marketing commitment to conduct pediatric studies with Veltassa and expects to begin the first pediatric study in late 2016.
2015 Financial Results
Net loss for the fourth quarter 2015 was $58.3 million, or $1.40 per share, compared to $27.6 million, or $0.80 per share, for the comparable period in 2014. Net loss for the full year 2015 was $178.7 million, or $4.39 per share, compared to $79.9 million, or $2.43 per share, in 2014.
Cash, cash equivalents and short-term investments totaled $240.7 million at December 31, 2015, compared to $135.8 million at December 31, 2014. Shares outstanding as of December 31, 2015 were 42.0 million. In January and February of 2016, the company raised $44.2 million under its at-the-market offering program, providing cash, cash equivalents and short-term investments of $285.0 million on a pro forma basis at December 31, 2015.
Collaboration and license revenue for the fourth quarter and full year 2015 was $12.0 million and $18.6 million, respectively, compared to no revenues for the comparable periods in 2014. The increase in revenues was due to the recognition of revenue for a portion of the $40.0 million upfront payment associated with Relypsa’s collaboration and license agreement with VFMCRP for the development and commercialization of Veltassa outside of the United States and Japan.
Research and development expenses for the fourth quarter of 2015 were $26.5 million, compared to $16.6 million for the comparable period in 2014. Research and development expenses for the full year 2015 were $93.3 million, compared to $50.2 million in 2014. The increase for the fourth quarter was primarily driven by costs associated with the Phase 1 drug-drug interaction studies. The increase for the full year was primarily due to pre-commercial manufacturing activities and personnel costs.
Selling, general and administrative expenses for the fourth quarter 2015 were $44.1 million, compared to $10.5 million for the comparable period in 2014. Selling, general and administrative expenses for the full year 2015 were $103.1 million, compared to $27.9 million in 2014. The increase for both the fourth quarter and full year was primarily due to an increase in personnel expenses to support expanding operations and an increase in commercial, marketing and medical affairs activities in preparation of the commercial launch of Veltassa.
For the full year 2016, based on its current plans and expectations, Relypsa projects total operating expenses in the range of approximately $275.0 to $300.0 million, including stock-based compensation of approximately $20.0 to $25.0 million. This anticipated increase in 2016 operating expenses will primarily be driven by ongoing commercialization of Veltassa in the United States and initiation of additional clinical studies with Veltassa. (Original Source)
Shares of Relypsa are falling 12% in after-hours trading. RLYP has a 1-year high of $42.26 and a 1-year low of $10.26. The stock’s 50-day moving average is $19.20 and its 200-day moving average is $21.50.
On the ratings front, Relypsa has been the subject of a number of recent research reports. In a report issued on February 12, H.C. Wainwright analyst Ed Arce reiterated a Buy rating on RLYP, with a price target of $63, which represents a potential upside of 273.0% from where the stock is currently trading. Separately, on February 9, BTIG’s Tim Chiang reiterated a Buy rating on the stock and has a price target of $45.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Ed Arce and Tim Chiang have a total average return of 9.5% and 0.6% respectively. Arce has a success rate of 30.8% and is ranked #468 out of 3664 analysts, while Chiang has a success rate of 44.7% and is ranked #1667.
Overall, 9 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $60.50 which is 258.2% above where the stock opened today.
Relypsa Inc is a biopharmaceutical company engaged in the development and commercialization of non-absorbed polymeric drugs to treat disorders in the areas of renal, cardiovascular and metabolic diseases.