Flexion Therapeutics, Inc.
Nov 9, 2015

Flexion Therapeutics Reports Third-Quarter 2015 Financial Results

Recent Highlights


BURLINGTON, Mass., Nov. 09, 2015 (GLOBE NEWSWIRE) -- Flexion Therapeutics, Inc. (Nasdaq:FLXN) today announced financial results for the third quarter ended September 30, 2015.

"We continue to  focus on advancing our lead program, Zilretta™ (a potential first-in-class injectable, non-opioid, sustained-release, intra-articular (IA) treatment for patients with moderate to severe osteoarthritis (OA) pain), toward a potential New Drug Application (NDA) filing in the second half of  2016," said Michael Clayman, M.D., Flexion Therapeutics President and Chief Executive Officer. "During the third quarter, we completed enrollment in our second pivotal trial (a Phase 3 study) and announced top-line data from our pivotal Phase 2b clinical trial, noting that while it did not achieve its primary endpoint, Zilretta™ provided substantial and persistent pain relief compared to placebo and was well-tolerated with a safety profile comparable to placebo. A pre-specified, commonly applied sensitivity analysis (Baseline Observation Carried Forward/Last Observation Carried Forward (BOCF/LOCF)) that addresses patient dropouts, however, did demonstrate statistical significance for the primary endpoint at 12-weeks (p = 0.042) in addition to weeks 1 to 11 and week 13.  For reference, we have now posted the BOCF/LOCF data curve on our website at www.flexiontherapeutics.com under Programs and Pipeline/Scientific Presentations. In addition, we have posted the original data curves with error bars to help illustrate the clear separation of the Zilretta™ curve from the placebo curve. Also, we were gratified to receive the notification of allowance for the trademark Zilretta™ from the U.S. PTO."

Third-Quarter Financial Results

The company reported a net loss of $11.1 million for the third quarter of 2015, compared to a net loss of $7.0 million for the third quarter of 2014.

Research and development expenses increased to $7.8 million in the third quarter of 2015, compared to $4.7 million for the same period in 2014, due to an increase in Zilretta™ program expenses related to the recently completed pivotal Phase 2b clinical trial and the on-going Phase 3 clinical trial, as well as higher expenses related to manufacturing scale-up.

General and administrative expenses increased to $3.2 million in the third quarter of 2015, as compared to $2.3 million for the same period in 2014, due primarily to increases in salary and related costs associated with increased headcount, including stock based compensation expense.

For the nine months ended September 30, 2015, the company reported a net loss of $32.7 million, compared to a net loss of $19.5 million for the same period in 2014.

Research and development expenses increased to $23.7 million for the nine months ended September 30, 2015 compared to $12.4 million for the same period in 2014, due to an increase in Zilretta™ program expenses related to the recently completed pivotal Phase 2b clinical trial and the preparation and initiation of the Phase 3 clinical trial, as well as higher expenses related to manufacturing of clinical trial supplies and supply scale-up. Increases in salary and other employee related costs, including stock compensation expense, also contributed to the higher spending level.

General and administrative expenses increased to $8.9 million for the nine months ended September 30, 2015 compared to $6.8 million for the same period in 2014, due to salary and related employee costs, including stock compensation expense, due to additional headcount.

As of September 30, 2015, the company had $132.2 million in cash, cash equivalents, and marketable securities compared to $151.6 million as of December 31, 2014.

Third Quarter Highlights and Recent News:

About Flexion Therapeutics

Flexion is a clinical-stage specialty pharmaceutical company focused on the development and commercialization of novel pain therapies. The company is currently advancing a portfolio of local, injectable, non-opioid drug candidates that have the potential to provide better and more persistent analgesia compared with existing therapy. The company's lead program, Zilretta™, is an intra-articular (IA) sustained-release therapy in development for patients with moderate to severe osteoarthritis (OA) pain. In the United States, OA is the most common joint disease, affecting 27 million people of which approximately five million patients receive IA injections for OA of the knee annually. The company also has two additional product candidates, FX007, a locally administered TrkA receptor antagonist for post-operative pain, and FX005, an IA, sustained-release p38 MAP kinase inhibitor for end-stage OA patients.

Conference Call

At 4:30 p.m. ET today, Flexion's management will host a conference call and webcast to review the Company's third quarter financial results and provide a general business update. The dial-in number for the conference call is (855) 770-0022 for domestic participants and (908) 982-4677 for international participants, with Conference ID # 67511063. A live webcast of the conference call can also be accessed through the "Investors" tab on the Flexion Therapeutics website at www.flexiontherapeutics.com. A webcast replay will be available online after the call.

Forward-Looking Statements

Statements in this press release regarding matters that are not historical facts, including statements relating to the future of Flexion; its ongoing development of its product candidates; expected timing and results of the ongoing Phase 3 clinical trial; Flexion's plans to commercialize ZilrettaTM; expected presentation of additional data from Flexion's recently-completed Phase 2b clinical trial; plans and timing for regulatory submissions; anticipated clinical and other milestones (including the timing of such milestones); and potential benefits of Zilretta™, are forward-looking statements. These forward-looking statements are based on management's expectations and assumptions as of the date of this press release and are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, without limitation, risks associated with the process of discovering, developing and obtaining regulatory approval for drugs that are safe and effective for use as human therapeutics, the fact that results of past clinical trials may not be predictive of subsequent trials, the fact that Flexion relies on third parties to manufacture and conduct the clinical trials of its product candidates, which could delay or limit their future development or regulatory approval, the fact that Flexion will require additional capital, including prior to commercializing Zilretta™ or any of its other product candidates, and may be unable to obtain such additional capital in sufficient amounts or on terms acceptable to it, the risk that Flexion's patents may be challenged or invalidated, and other risks and uncertainties described in Flexion's filings with the Securities and Exchange Commission (SEC), including under the heading "Risk Factors" in Flexion's Annual Report on Form 10-K for the year ended December 31, 2014 and subsequent filings with the SEC. You are encouraged to read Flexion's filings with the SEC, available at www.sec.gov, for a discussion of these and other risks and uncertainties. The forward-looking statements in this press release speak only as of the date of this press release, and Flexion undertakes no obligation to update or revise any of the statements.

  FLEXION THERAPEUTICS
  CONDENSED STATEMENT OF OPERATIONS
  (in thousands, except for per share information)
         
     Three  Months Ended Nine Months Ended
     September 30, September 30,
      2015  2014   2015  2014 
Revenue    $- $-  $- $- 
          
Operating expenses:       
Research and development   7,829  4,658   23,724  12,424 
General and administrative   3,197  2,304   8,860  6,822 
Total expenses   11,026  6,962   32,584  19,246 
Loss from operations   (11,026) (6,962)  (32,584) (19,246)
Interest income (expense), net  71  56   476  4 
Other income (expense)   (181) (130)  (638) (266)
Loss from operations before income tax  (11,136) (7,036)  (32,746) (19,508)
Net loss   (11,136) (7,036)  (32,746) (19,508)
           
Basic and diluted net loss per share $(0.52)$(0.45) $(1.52)$(1.50)
Basic and diluted weighted      
average number of common shares
outstanding
 21,507  15,625   21,478  13,008 
    
    
    
   FLEXION THERAPEUTICS
SELECTED BALANCE SHEET DATA
(in thousands)
   
   
   
   
     September 30,December 31,
      2015  2014 
       
Cash and cash equivalents  $73,507 $103,098 
Marketable securities   58,658  48,527 
Total current assets   133,015  152,127 
Working capital   126,429  145,328 
Total assets   137,248  153,377 
Total notes payable   14,942  3,593 
Total stockholders' equity (deficit)  115,706  144,942 


 

CONTACTS:

Investor Relations Contact
David Carey
Lazar Partners LTD
T: 212-867-1768 
dcarey@lazarpartners.com

Media Relations Contact
Mariann Caprino
TogoRun
917.242.1087  
M.Caprino@togorun.com

Corporate Contact
Fred Driscoll
Chief Financial Officer
Flexion Therapeutics, Inc.
T: 781-305-7763
fdriscoll@flexiontherapeutics.com