On August 12, 2015 DARA BioSciences, Inc. (NASDAQ: DARA), an oncology supportive care pharmaceutical company dedicated to providing health care professionals a synergistic portfolio of medicines to help cancer patients adhere to their therapy and manage side effects arising from their cancer treatment, reported its second quarter 2015 results (Press release, Dara Biosciences, AUG 12, 2015, View Source [SID:1234507228]).
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Second Quarter 2015 Financial Snapshot
DARA reported net revenues of $990.8 thousand for the second quarter ended June 30, 2015 based on gross product sales in excess of $1.4 million, as compared to net revenues of $409.4 thousand for the second quarter ended June 30, 2014, a year over year increase of 142%. The increase in revenues was primarily attributable to the expanded commercial sales organization and ongoing success in generating interest and prescriptions across DARA’s oncology supportive care product portfolio.
DARA reported a loss attributable to controlling interest of approximately $2.7 million or ($0.14) per share for the second quarter ended June 30, 2015 as compared to a loss attributable to controlling interest of approximately $2.6 million, or ($0.24) per share for the second quarter ended June 30, 2014. The loss attributable to controlling interest for the current quarter was $101.0 thousand more than the same period last year. Sales and marketing costs for the quarter increased $130.8 thousand over the same period last year, primarily as a result of increased personnel costs, including an increase in incentive based field sales compensation driven by higher sales achievement. An increase in general and administrative expenses of $268.5 thousand was primarily driven by increased professional services costs related to DARA’s proposed merger with Midatech Pharma PLC. Research and development expenses increased by $58.7 thousand primarily as a result of increased consulting and professional service expenses, partially offset by decreased personnel costs. As of June 30, 2015, cash and cash equivalents totaled approximately $7.0 million.
"Our second quarter results illustrate continued growth from our commercial efforts, as our product portfolio continues to be accepted and utilized to support oncology patients and oncology health care providers nationwide," stated Christopher G. Clement, President and CEO of DARA BioSciences. "In combination with our national field sales team’s efforts, DARA’s unique service offerings for our products continue to result in positive sales trends across our product portfolio. Our continued momentum in the business and prescription increases for our key products Gelclair and Soltamox on a year to date basis support our full year estimates of net revenues for these two products to reach $3.7 million for 2015, excluding any net revenue contribution from the launch of Oravig later in the year."
Clement continued, "We are excited regarding the ongoing strong performance of our commercial business and look forward to sustained success as we continue towards the consummation of our merger agreement with Midatech PLC. As of today the timelines for the close of the transaction with Midatech remain on track and we believe that this will take place prior to the end of 2015. Midatech has completed the first significant goal in moving toward closing through the filing of their registration statement on Form F-4 with the Securities and Exchange Commission on August 11, 2015. Additionally, we are on schedule to launch Oravig back to the market in the fourth quarter of this year, providing an important product for both DARA’s oncology portfolio as well for Mission Pharmacal, DARA’s primary care partner for Oravig."
Dr. David J. Drutz, Executive Chairman of the Board and Chief Medical Officer of DARA BioSciences, commented, "We had several important developments during the quarter that we believe will enhance the attractiveness of KRN5500 to interested parties. On July 9, 2015 the FDA provided formal agreement with the Company’s full proposed development plan, beginning with design of the Phase 2b dose-escalation strategy in cancer patients with painful chronic chemotherapy-induced peripheral neuropathy, or CCIPN. The FDA also indicated agreement with proposed bridging studies for the new KRN5500 formulation. These are significant advances that clarify the steps needed to advance this product into further clinical development."
DARA believes that its currently available funds, together with projected sales of Gelclair, an FDA-approved bioadherent oral rinse gel for treating the painful symptoms of oral mucositis (OM), Soltamox, (tamoxifen citrate) oral liquid solution, Oravig, the first and only orally-dissolving buccal tablet approved for oral thrush, and the Mission Pharmacal products Ferralet 90 (for anemia) and Aquoral (for cancer-related dry mouth), will enable the Company to fund its current operations and to meet its obligations into the first quarter of 2016.
Second Quarter 2015 Operational Highlights and Recent Key Events
The Company made significant progress during the second quarter of 2015 in executing its strategy as well as expanding the commercial opportunity for its flagship oncology and oncology supportive care products, as follows:
Quarterly net revenues increased 142% from Q2 FY’14 to $990.8 thousand, based on continued increases in prescriptions for our oncology supportive care portfolio.
Signed merger agreement with Midatech Pharma PLC, a UK-Based Specialty Pharmaceutical Company with expected deal closing in the fourth quarter of 2015.
Planning for the Oravig Launch in Q4 of this year, into both the oncology and the primary care markets.
Gelclair continues to be the leading gel barrier prescribed in the U.S. retail market, per Symphony Prescription data, leading the nearest competitor by almost a 3 to 1 margin of prescriptions written in June and outperforming the overall gel barrier retail prescription market with an increase in retail prescriptions of 41% Q2 vs. Q1 of 2015 while the overall gel barrier retail was up less than 20% for the same time period.
Q2 showed a significant increase (over 300%) in Gelclair prescriptions through our HUB pharmacy vs Q1 of this year.
DARA has provided Gelclair to over 350 uninsured or underinsured patients, through our HUB program, providing health care providers a dependable option for prescribing Gelclair to all of their appropriate patients.
Soltamox has shown sequential quarterly growth both in the retail and wholesale sectors, with prescriptions rising on a quarter to quarter basis.
DARA initiated a patient- focused educational program with a leading provider of oncology patient portal services.
Ferralet and Aquoral demonstrated increased sales quarter over quarter.
Based upon continued strong sales performance of the oncology supportive care portfolio, DARA has initiated a tele sales program to bolster sales in white space areas across the country.
Key development asset KRN5500 obtained a Notice of Allowance for a new formulation, enhancing attractiveness of a partnership opportunity through improved clinical administration of the drug, as well as provision of IP protection through 2032, a period well beyond that afforded by its current orphan designations.
Based on our current trends and continued growth DARA continues to support our previous guidance of $3.7 million for Gelclair and Soltamox net sales for the full year 2015, excluding any net revenue contribution from the launch of Oravig later in the year.