SAN DIEGO, March 1 /PRNewswire-FirstCall/ —ACADIA Pharmaceuticals Inc.(Nasdaq: ACAD), a biopharmaceutical company utilizing innovative technology tofuel drug discovery and clinical development of novel treatments for centralnervous system disorders, today reported its unaudited financial results forthe fourth quarter and year ended December 31, 2005.
ACADIA reported a net loss of $10.2 million for the fourth quarter of 2005compared to a net loss of $7.3 million for the fourth quarter of 2004. Forthe year ended December 31, 2005, ACADIA reported a net loss of $34.1 millioncompared to a net loss of $25.9 million for 2004. The net loss for the fourthquarter and year ended December 31, 2005 included a provision for loss fromlitigation of $360,000 and $6.2 million, respectively, related to a previouslydisclosed civil action.
At December 31, 2005, ACADIA's cash, cash equivalents, investmentsecurities, and restricted cash totaled $55.5 million compared to$35.9 million at December 31, 2004. The cash balance at December 31, 2005 didnot include $10.0 million in proceeds received by ACADIA in January 2006 fromSepracor Inc.'s second purchase of ACADIA common stock pursuant to thecompanies' collaboration. The increase in cash during 2005 was primarily dueto net proceeds from sales of equity securities, including $34.0 millionraised in a private placement in April 2005 and $10.0 million received fromSepracor's first purchase of ACADIA common stock in January 2005, partiallyoffset by cash used to fund ACADIA's operations.
"2005 was a highly productive year for ACADIA, highlighted by theadvancement of our four Phase II clinical programs, the formation of animportant new collaboration with Sepracor, and the strengthening of ourfinancial position," said Uli Hacksell, Ph.D., ACADIA's Chief ExecutiveOfficer. "We believe that the significant progress made during 2005 positionsACADIA to deliver transforming milestones during 2006 as we continue toexecute on our strategy of building a broad pipeline of innovative therapiesto treat central nervous system disorders and other areas of unmet medicalneed."
Revenues increased to $2.4 million for the fourth quarter of 2005 from$1.1 million for the fourth quarter of 2004. This increase was primarily dueto approximately $900,000 in revenues recognized under ACADIA's collaborationwith Sepracor as well as revenues earned pursuant to its agreement with theStanley Medical Research Institute (SMRI). Revenues from ACADIA'scollaborations with Allergan totaled $1.1 million for each of the fourthquarter of 2005 and the comparable quarter of 2004. Revenues increased to$11.0 million for the year ended December 31, 2005 from $4.6 million for 2004,consisting of revenues from ACADIA's agreements with Sepracor, Allergan, andSMRI.
Research and development expenses increased to $10.1 million for thefourth quarter of 2005 from $6.4 million for the fourth quarter of 2004,primarily due to increased clinical development costs associated with ACADIA'sproprietary Phase II drug programs and expansion of its research anddevelopment organization. Fees paid to external service providers, largelyrelated to clinical development, totaled $4.8 million for the fourth quarterof 2005 compared to $2.4 million for the fourth quarter of 2004. Research anddevelopment expenses increased to $30.8 million for the year endedDecember 31, 2005 from $23.5 million for 2004, primarily due to $3.2 millionin increased fees paid to external service providers and increased costsassociated with expansion of ACADIA's research and development organization.
General and administrative expenses increased to $2.6 million for thefourth quarter of 2005 from $1.8 million for the fourth quarter of 2004. Thisincrease was primarily due to approximately $500,000 in increased professionalfees associated with ACADIA's Sarbanes-Oxley Act compliance efforts andincreased costs associated with expansion of its administrative organization.General and administrative expenses increased to $8.4 million for the yearended December 31, 2005, from $4.9 million for 2004, primarily due toincreased costs associated with operating as a public company, includingprofessional services associated with Sarbanes-Oxley Act compliance efforts,and costs associated with expansion of ACADIA's administrative organizationand costs related to litigation.
Although ACADIA has appealed the previously disclosed civil verdict,ACADIA recorded a provision for loss from litigation of $360,000 and$6.2 million for the fourth quarter and year ended December 31, 2005,respectively. This provision for the year ended December 31, 2005 representsthe aggregate amount of damages and related fees and costs awarded pursuant tothe jury verdict plus accrued interest, net of $2.4 million in remaininginsurance proceeds that ACADIA may receive.
2005 and Recent Highlights
Advancement of Clinical Pipeline
ACP-103 for Treatment-Induced Dysfunctions in Parkinson's Disease
- ACADIA announced in November 2005 that it had completed enrollment in amulti-center, double-blind, placebo-controlled Phase II trial designedto evaluate the efficacy and tolerability of ACP-103 in 60 Parkinson'sdisease patients who suffer from treatment-induced psychosis. InJune 2005, ACADIA reported encouraging results from an interim trendanalysis of this trial based on the first 30 patients to complete thestudy. ACADIA expects to report results from the complete Phase II trialduring March 2006.
- ACADIA has an ongoing open-label study involving the extended use ofACP-103 in Parkinson's disease patients with psychosis who havecompleted the aforementioned Phase II trial and may, in the opinion ofthe treating physician, benefit from continued treatment with ACP-103.ACADIA expects to provide an update on this open-label study inconnection with reporting results from the aforementioned Phase IItrial.
ACP-103 as an Adjunctive Therapy for Schizophrenia
- ACADIA continues to enroll patients in a multi-center, double-blind,placebo-controlled Phase II trial designed to evaluate the ability ofACP-103 when used adjunctively with other antipsychotic drugs to providean improved therapy for patients with schizophrenia. This trial isdesigned to enroll up to 400 patients with schizophrenia and to includea formal interim analysis after 200 patients have completed the 42-daytreatment schedule. ACADIA expects to report results from the interimanalysis during the second half of 2006.
- ACADIA reported in December 2005 results of a double-blind, placebo-controlled Phase II trial showing that ACP-103 reduced haloperidol-induced akathisia, a debilitating side effect often induced byantipsychotic drugs, in patients with schizophrenia.
ACP-103 PET and Polysomnography Clinical Study
- ACADIA reported today that it has completed enrollment of a double-blind, placebo-controlled, combined positron emission tomography (PET)and polysomnography clinical study with ACP-103 in 45 healthy oldervolunteers. This study is designed primarily to determine therelationship between brain receptor occupancy and steady-state plasmalevels of ACP-103 and to assess the effect of sub-chronic oraladministration of ACP-103 on deep, or slow wave sleep. ACADIA expects toreport results from this study during the second quarter of 2006.
ACP-104 as a Therapy for Schizophrenia
- ACADIA is currently conducting three initial studies in its Phase IIprogram for ACP-104 in patients with schizophrenia, including: a double-blind, placebo-controlled, single ascending-dose study; a double-blind,placebo-controlled, multiple ascending-dose study; and a single-dose PETstudy. ACADIA reported initial results from the single ascending-dosestudy in November 2005 based on a total of 10 patients, showing thatACP-104 was safe and well tolerated at each of the doses tested and nodose limiting or serious adverse events were observed. ACADIA expects toreport results from these three initial clinical trials with ACP-104,encompassing a total of about 50 patients, during the second quarter of2006.
- ACADIA published research showing that ACP-104, the major metabolite ofclozapine, is a partial agonist at dopamine D2 and D3 receptors, whereasclozapine and most other antipsychotics block these receptors and thismay lead to increased motoric side effects. ACP-104 uniquely combines M1muscarinic agonism, 5-HT2A inverse agonism, and D2 and D3 partialagonism in a single molecule.
Collaborative Neuropathic Pain Program
- ACADIA announced in October 2005 that it earned a milestone resultingfrom Allergan's commencement of an initial Phase II clinical trial inthe companies' collaborative program directed at novel treatments forneuropathic pain. Allergan has completed Phase I clinical trials for twosmall molecule drug candidates and is currently conducting Phase IIclinical trials in this program.
Business and Other Highlights
- ACADIA formed a collaboration with Sepracor in January 2005 for thedevelopment of new drug candidates targeted toward the treatment ofcentral nervous system disorders. In connection with the collaboration,Sepracor made the first of two $10 million purchases of ACADIA commonstock in January 2005. Sepracor completed the second $10 millionpurchase in January 2006.
- ACADIA reported today that it has extended the research term of itsMarch 2003 discovery collaboration with Allergan for two years throughMarch 2008. The extension will focus joint research efforts in the areaof pain and the parties may elect to pursue additional discoveryactivities in ophthalmic or other indications. The research in the painarea will support the companies' Phase II clinical program inneuropathic pain.
- ACADIA raised net proceeds of $34 million from the sale of common stockand warrants to purchase common stock in a private placement completedin April 2005.
- ACADIA has strengthened its management team. During the first quarter of2005, Daniel P. van Kammen, M.D., Ph.D. was appointed Vice President,Clinical Development and Douglas W. Bonhaus, Ph.D. was appointed VicePresident, Biosciences. In January 2006, David C. Furlano, Ph.D., wasappointed Vice President, Regulatory Affairs.
- ACADIA added additional experience to its board of directors during 2005through the elections of two new members, Mary Ann Gray, Ph.D., andMichael T. Borer.
- ACADIA enhanced its discovery platform and related assets, including thedevelopment of assay technologies for tyrosine kinase linked receptorsand publication of research on ACADIA's discovery of novel isoform-selective retinoic acid receptor agonists.
- ACADIA enhanced its discovery and development capabilities through theconsolidation of its chemistry operations in a modern research facilitylocated in Malmo, Sweden.
Conference Call and Webcast Information
Uli Hacksell, Ph.D., Chief Executive Officer, and Thomas H. Aasen, VicePresident and Chief Financial Officer, will review fourth quarter and year endresults and highlights via conference call and webcast later today at5:00 p.m. Eastern Time. The conference call may be accessed by dialing866-713-8562 for participants in the U.S. or Canada and 617-597-5310 forinternational callers (reference passcode 17247135). A telephone replay ofthe conference call may be accessed through March 15, 2006 by dialing888-286-8010 for callers in the U.S. or Canada and 617-801-6888 forinternational callers (reference passcode 28684341). The conference call alsowill be webcast live on ACADIA's website, www.acadia-pharm.com, under theinvestors section and will be archived there until March 15, 2006.
About ACADIA Pharmaceuticals
ACADIA is a biopharmaceutical company utilizing innovative technology tofuel drug discovery and clinical development of novel treatments for centralnervous system disorders. ACADIA currently has four drug programs in clinicaldevelopment as well as a portfolio of preclinical and discovery assetsdirected at large unmet medical needs, including schizophrenia, Parkinson'sdisease, neuropathic pain, and glaucoma. All of the drug candidates inACADIA's product pipeline emanate from discoveries made using its proprietarydrug discovery platform. ACADIA's corporate headquarters is located in SanDiego, California and it maintains research and development operations in bothSan Diego and Malmo, Sweden.
Forward-Looking Statements
Statements in this press release that are not strictly historical innature are forward-looking statements. These statements include but are notlimited to statements related to the progress and timing of ACADIA's drugdiscovery and development programs and related clinical trials, includingachieving milestones thereunder, the safety, tolerability, and efficacy ofACADIA's drug candidates, the potential of ACADIA's collaborations, our futureresults or business prospects, and the benefits to be derived from ACADIA'stechnology, approach and drug candidates, in each case including ACP-103 andACP-104. These statements are only predictions based on current informationand expectations and involve a number of risks and uncertainties. Actualevents or results may differ materially from those projected in any of suchstatements due to various factors, including the risks and uncertaintiesinherent in drug discovery, development and commercialization, collaborationswith others, and litigation. For a discussion of these and other factors,please refer to ACADIA's annual report on Form 10-K for the year endedDecember 31, 2004 as well as other subsequent filings with the Securities andExchange Commission. You are cautioned not to place undue reliance on theseforward-looking statements, which speak only as of the date hereof. Thiscaution is made under the safe harbor provisions of the Private SecuritiesLitigation Reform Act of 1995. All forward-looking statements are qualifiedin their entirety by this cautionary statement and ACADIA undertakes noobligation to revise or update this press release to reflect events orcircumstances after the date hereof.
Additionally, certain of the information contained in this press releasereflects preliminary financial results, as ACADIA's 2005 audit has not yetbeen completed. The 2005 audit and the evaluation of ACADIA's internalcontrol over financial reporting under Section 404 of the Sarbanes-Oxley Actof 2002 will be completed nearer the date that ACADIA files its Annual Reporton Form 10-K for the year ended December 31, 2005 with the Securities andExchange Commission.
ACADIA PHARMACEUTICALS INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(in thousands, except per share amounts)(Unaudited)Three Months Ended Years EndedDecember 31, December 31,2005 2004 2005 2004Collaborative revenues $2,443 $1,083 $10,956 $4,604Operating expensesResearch and development 10,104 6,375 30,848 23,454General and administrative 2,599 1,788 8,386 4,889Provision for loss fromlitigation 360 —6,221 —Stock-based compensation 80 376 1,307 2,356Total operating expenses 13,143 8,539 46,762 30,669Loss from operations (10,700) (7,456) (35,806) (26,095)Interest income (expense),net 497 121 1,671 178Net loss (10,203) (7,335) (34,135) (25,917)Participation of preferredstock ———(8,587)Net loss available tocommon stockholders (10,203) (7,335) (34,135) (17,330)Net loss per common share,basic and diluted $(0.44) $(0.44) $(1.55) $(1.67)Weighted average commonshares outstanding, basicand diluted 23,436 16,738 22,007 10,354Net loss available toparticipatingpreferred stockholders $—$—$—$(8,587)Net loss per participatingpreferred share, basicand diluted $—$—$—$(0.87)Weighted averageparticipating preferredshares outstanding, basicand diluted ———9,901ACADIA's preferred stock was reclassified or converted into 9,900,913shares of common stock upon the closing of its initial public offering onJune 2, 2004.ACADIA PHARMACEUTICALS INC.CONDENSED CONSOLIDATED BALANCE SHEETS(in thousands)(Unaudited)December 31,2005 2004(1)Consolidated Balance Sheets Data:AssetsCash, cash equivalents, investmentsecurities and restricted cash $55,521 $35,927Prepaid expenses, receivables and othercurrent assets (2) 4,604 1,891Total current assets 60,125 37,818Property and equipment, net 2,283 2,547Other assets 98 —Total assets $62,506 $40,365Liabilities and Stockholders' EquityCurrent liabilities (3) 21,702 8,641Long-term liabilities 1,433 1,044Stockholders' equity 39,371 30,680Total liabilities and stockholders' equity $62,506 $40,365(1) The condensed consolidated balance sheet at December 31, 2004 hasbeen derived from the audited financial statements at that date butdoes not include all of the information and footnotes required byaccounting principles generally accepted in the United States forcomplete financial statements.(2) Prepaid expenses, receivables and other current assets atDecember 31, 2005 includes a receivable of $2.4 million forinsurance proceeds related to litigation.(3) Current liabilities at December 31, 2005 includes accrued loss fromlitigation of $8.7 million.
CONTACT:
Lisa Barthelemy, Director, Investor Relations
Thomas H. Aasen, Vice President and Chief Financial Officer
+1-858-558-2871