- Reported Positive Topline Data from Phase 1 Study of EDP-323, an L-Protein Inhibitor in Development as an Oral, Once-Daily Treatment for Respiratory Syncytial Virus (RSV); Expect to Initiate Phase 2 Human Challenge Study in Early 4Q 2023.
- Cash and Marketable Securities Totaled $392.5 Million at June 30, 2023
- Royalty Revenue for the Quarter was $18.9 Million
WATERTOWN, Mass.--(BUSINESS WIRE)-- Enanta Pharmaceuticals, Inc. (NASDAQ:ENTA), a clinical-stage biotechnology company dedicated to creating small molecule drugs for viral infections, today reported financial results for its fiscal third quarter ended June 30, 2023.
“Our fiscal third quarter was marked by important progress in our pipeline, most notably across our RSV and COVID-19 programs. In RSV, we were pleased to report positive Phase 1 results for EDP-323 in healthy volunteers, demonstrating favorable safety, tolerability, and pharmacokinetics. These data allow us to build and progress our RSV portfolio through advancement of this second oral RSV antiviral into a Phase 2 human challenge study, with a goal of identifying potential applications for EDP-323 as a monotherapy or combination approach. We believe our RSV antivirals have significant promise and we are advancing our clinical programs with a sense urgency given the substantial unmet need for RSV treatments,” said Jay R. Luly Ph.D., President and Chief Executive Officer of Enanta Pharmaceuticals. “Additionally, in our COVID-19 program, we presented further data in June from the SPRINT trial where EDP-235 treatment resulted in a 1.0 log drop in viral load in the subset of patients who had not been recently infected with SARS-CoV-2 and were treated within three days of symptom onset. With our robust pipeline, including EDP-938, the most advanced RSV N-protein inhibitor in development, and our strong financial position, we are poised to be a leader in the development of therapeutics for life-threatening viruses.”
Fiscal Third Quarter Ended June 30, 2023 Financial Results
Total revenue for the three months ended June 30, 2023 was $18.9 million and consisted of royalty revenue from worldwide net sales of AbbVie’s hepatitis C virus (HCV) regimen MAVYRET®/MAVIRET® (glecaprevir/pibrentasvir), compared to $19.5 million for the three months ended June 30, 2022.
Research and development expenses totaled $43.0 million for the three months ended June 30, 2023, compared to $39.1 million for the three months ended June 30, 2022. The increase was primarily due to the timing of clinical trial expenses in the company’s virology programs.
General and administrative expenses totaled $12.6 million for the three months ended June 30, 2023, compared to $12.9 million for the three months ended June 30, 2022.
Enanta recorded income tax expense of $4.2 million for the three months ended June 30, 2023 driven by the receipt of the $200.0 million from the royalty sale agreement which is taxable for federal and state purposes. Enanta was able to utilize federal net operating loss and research and development tax credit carryforwards as well as a deduction for foreign derived intangible income to substantially offset the taxable effect of the royalty sale agreement. For the three months ended June 30, 2022, Enanta recorded an income tax benefit of $0.4 million, which was due to the release of a state tax reserve during the period.
Net loss for the three months ended June 30, 2023 was $39.1 million, or a loss of $1.86 per diluted common share, compared to a net loss of $31.7 million, or a loss of $1.53 per diluted common share, for the corresponding period in 2022.
Enanta’s cash, cash equivalents and short-term and long-term marketable securities totaled $392.5 million at June 30, 2023. In April 2023, Enanta sold 54.5% of its ongoing royalties from AbbVie on sales of MAVYRET®/MAVIRET® after June 30, 2023, for an upfront payment of $200.0 million from OMERS, one of Canada’s largest defined benefit pension plans. For financial reporting purposes, the transaction will be treated as debt, with the upfront purchase payment of $200.0 million recorded as a liability. Enanta will continue to record 100% of the royalty earned as revenue and will then amortize the debt liability proportionally as 54.5% of the cash royalties are paid to OMERS, until a cap of 1.42 times the purchase payment is met, after which point 100% of the cash royalties will be retained by Enanta. Interest expense will be recorded in Enanta’s consolidated statement of operations as other expense based on an imputed interest rate.
Enanta expects that its current cash, cash equivalents and marketable securities and its continuing portion of cash from future royalty revenue, should be sufficient to meet the anticipated cash requirements of its existing business and development programs into the second half of fiscal 2027.
Updated Financial Guidance for Fiscal 2023
- Research and Development Expense: $165 million to $175 million
- General and Administrative Expense: $50 million to $55 million
- 54.5% of royalties on MAVYRET®/MAVIRET® sales in fiscal fourth quarter will be paid to OMERS
Pipeline Update and Business Review
RSV
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EDP-938, an N-protein inhibitor with Fast Track designation from the U.S. Food and Drug Administration (FDA), is supported by data from a Phase 2 RSV human challenge study that demonstrated a significant impact on viral replication and symptom reduction, and is the only published study to show such an effect for an N-inhibitor. EDP-938 also has a favorable and consistent safety profile.
- Ongoing studies of EDP-938 include RSVPEDs, a Phase 2 randomized, double-blind, placebo-controlled study in hospitalized and non-hospitalized pediatric RSV patients; RSVHR, a Phase 2b randomized, double-blind, placebo-controlled study in adults with RSV infection who are at high risk of complications, including the elderly and/or those with congestive heart failure, chronic obstructive pulmonary disease or asthma; and RSVTx, a Phase 2b, randomized, double-blind, placebo-controlled study in adult hematopoietic cell transplant recipients with RSV infection and symptoms of upper respiratory tract infection.
- Enanta expects to complete enrollment in one or more of its ongoing Phase 2 studies of EDP-938 in the upcoming Northern Hemisphere RSV season and to report data in fiscal 2024, pending a return to a normal pre-pandemic type of RSV season in the Northern Hemisphere.
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In June, Enanta reported positive topline data from healthy volunteers in its Phase 1 study of EDP-323, an oral, L-protein inhibitor, for the treatment of RSV. EDP-323 has the potential to be used alone or in combination with EDP-938 to address different patient populations or extend the treatment window. Data demonstrated favorable safety, tolerability, and pharmacokinetics (PK) supportive of once-daily dosing, with good exposure multiples, thereby supporting further clinical advancement of EDP-323.
- Enanta plans to initiate a human challenge study evaluating EDP-323 early in the fourth quarter of 2023 and anticipates having data results in the second quarter of 2024.
COVID-19 (SARS-CoV-2)
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Enanta announced additional analyses of SPRINT (SARS-Cov-2 PRotease INhibitor Treatment), its Phase 2 clinical trial of EDP-235, an oral, 3CL protease inhibitor in non-hospitalized, symptomatic adults with mild or moderate COVID-19.
- These analyses demonstrated a virologic effect of EDP-235 in the subset of patients who had not been recently infected, known as nucleocapsid-negative patients, as measured by lack of antibodies to the SARS-CoV-2 nucleocapsid. Specifically, in this nucleocapsid-negative patient subset, an 0.8 log viral load decline was observed at Day 5 with 400 mg of EDP-235 compared to placebo, and a 1.0 log viral load decline in nucleocapsid-negative patients who were treated within three days of symptom onset.
- These data build upon the positive topline SPRINT data announced in May in which a dose-dependent improvement in symptoms was observed with EDP-235 treatment compared to placebo, which achieved statistical significance (p