CHARLOTTE, N.C., March 12, 2007 (PRIME NEWSWIRE) -- Chelsea Therapeutics International, Ltd. (Nasdaq:CHTP) today presented a quarterly update on the Company's development progress, reported financial results for the fourth quarter and full year 2006 and will host a conference call this afternoon to discuss these results at 4:30 PM EST.
Financial Results: * Net loss was $2.4 million, or ($0.12) per share, for the fourth quarter of 2006, compared with a net loss of $1.9 million, or ($0.16) per share, for the same period in 2005 * Net loss was $8.7 million, or ($0.46) per share, for the year ended December 31, 2006 compared to a net loss of $7.9 million, or ($0.64) per share for the year ended December 31, 2005 * Cash used for operations $7.1 million for the year ended December 31, 2006 * Chelsea ended the year with $15.9 million in cash and cash equivalents, compared with $3.2 million at December 31, 2005. 2006 Corporate Highlights: * Secured NASDAQ Stock Market(r) listing approval * Initiated co-development of portfolio of therapeutics targeting autoimmune disease and transplant rejection with Active Biotech * Signed exclusive Droxidopa license agreement with Dainippon Sumitomo Pharma * Filed Orphan Drug Application and Formed Scientific Advisory Board for Droxidopa * Selected a new disodium salt composition and initiated pharmaceutical formulation enhancements to CH-1504
"The past year was a transformative year for Chelsea during which we strategically expanded our product pipeline, accelerated our commercial opportunity through the acquisition of droxidopa, and added further depth and breadth through our co-development agreement with Active Biotech. Combined with the recent validation and on-going clinical development of CH-1504, Chelsea now has a strong and diversified portfolio of promising drug candidates at multiple stages of clinical development," commented Dr. Simon Pedder, President and CEO of Chelsea. "This year, we intend to execute on the promise of this pipeline in two ways. First, we intend to meet our near term goals of demonstrating proof of concept for CH-1504 by initiating Phase II trials in rheumatoid arthritis and initiating our pivotal Phase III Droxidopa trial. As these core programs progress, we plan to seek long-term value creation by implementing additional clinical programs to demonstrate efficacy in indications in which we believe there may be potential therapeutic benefits and significant addressable market opportunities."
2007 Development Plans
Droxidopa
Chelsea intends to seek initial approval of Droxidopa for the treatment of symptomatic neurogenic orthostatic hypotension (NOH) in patients with primary autonomic failure and plans to initiate a double-blind placebo controlled pivotal Phase III trial at multiple sites in the U.S. and Europe during the fourth quarter of 2007. This indication is consistent with the U.S. Orphan Drug status designation granted by the FDA on January 17, 2007 and enables Chelsea to leverage the strongest body of available clinical data to reduce clinical requirements for marketing approval and accelerate its commercialization in the U.S. and EU.
On March 7, 2007, Chelsea management met with the EMEA to discuss its Orphan Status application for the treatment of symptomatic NOH in patients with primary autonomic failure, a group of diseases that includes Parkinson's Disease, pure autonomic failure and multiple systems atrophy. During this meeting the EMEA indicated that in their viewpoint there exists a clear medical need for the treatment of NOH in each of the three indications associated with primary autonomic failure included in the initial application. In agreement with the EMEA recommendation, Chelsea will redirect its request for Orphan Status in the form of three separate applications for symptomatic NOH associated with 1) Parkinson's Disease; 2) multiple systems atrophy; and 3) pure autonomic failure respectively. Based on these discussions, Chelsea anticipates that a single pivotal trial could be inclusive of all these indications to support a marketing application in the EU.
As Chelsea proceeds with development of droxidopa for the treatment of symptomatic NOH, the company has begun advancing its plans for the clinical evaluation of Droxidopa in other therapeutic indications for which it either has previously shown or may potentially provide clinical benefit.
Building on existing clinical data from DSP, Chelsea plans to initiate a Phase II trial in intradialytic hypotension (IDH) before year-end. The most common adverse event during routine hemodialysis, IDH has been reported in approximately 25% of all hemodialysis patients with reported incidence increasing with age. Many adverse hemodialysis events -- including headaches, lightheadedness, nausea, and cramps, are associated with IDH. These complications can routinely interrupt dialysis sessions, resulting in insufficient uremia toxin removal and necessitating repetition of the procedure. Pivotal clinical trials conducted by DSP have demonstrated the efficacy of droxidopa in the prevention of vertigo, dizziness and weakness associated with hypotension in hemodialysis patients. Subsequently, in 2000, after showing statistically significant efficacy in two randomized double-blind placebo controlled trials DSP received expanded marketing approval in Japan for this indication. Given the anticipated ease of recruitment and planned duration of the trial, preliminary results in this indication could be seen by the second half of 2008.
After initiating clinical trials in both NOH and IDH, Chelsea plans to conduct exploratory proof of concept trials to investigate the potential benefit of droxidopa in treating symptoms associated with certain dysautonomia related diseases such as Fibromyalgia (FM) and Chronic Fatigue Syndrome (CFS). Symptoms of NOH and/or neurally mediated hypotension (NMH) are commonly seen in patients suffering from both FM and CFS and may be the result of defects in the autonomic nervous system such as altered norepinephrine levels and/or activity.
Unlike NOH, in which blood pressure decreases immediately upon standing, NMH is caused by the failure to maintain appropriate increases in heart rate in response to vasodilation that occurs after standing for prolonged periods. Instead of increasing, the heart rate actually drops, preventing the necessary amount of blood from being circulated and leading to symptoms like dizziness and fainting. As norepinephrine naturally stimulates both heart rate and vasoconstriction, Droxidopa could be an appropriate alternative therapy to treat NMH by directly regulating cardiac function and/or enhancing vasoconstriction as needed.
Chelsea is currently planning an initial trial to determine whether droxidopa improves NMH and/or NOH associated with FM or CFS and whether it may show further benefit treating additional symptoms within these disease syndromes such as pain, fatigue, weakness, and incontinence. Specifically, Chelsea is currently working with key opinion leaders in fibromyalgia (FM) and chronic fatigue syndrome (CFS), including Dr. Ernest Choy, to determine the appropriate design, size and timing for an initial trial in these indications. Dr. Choy is a Consultant Rheumatologist and Director of the Sir Alfred Baring Garrod Clinical Trials Unit in the Academic Department of Rheumatology, King's College London and chairs the European League Against Rheumatism Working Group on developing recommendations for treatment of fibromyalgia.
CH-1504
In 2006, Chelsea initiated the reformulation of CH-1504 to enhance the absorption of the compound such that the therapeutic plasma levels would be more predictable and less variable, thus ensuring the strongest possible comparison of CH-1504 to methotrexate. As a result of these efforts, Chelsea has selected a disodium salt composition that demonstrates significant improvement in peak plasma levels and systemic exposure compared to the original free acid composition. In addition to reformulation as a salt, Chelsea has completed standard pharmaceutical formulation enhancements that are expected to provide further improvement in the pharmacokinetic profile of CH-1504.
Chelsea intends to initiate human bioequivalence studies to determine a comparable dose range for its new salt formulation of CH-1504 during the second quarter 2007. The bioequivalence study will consist of escalating oral doses of CH-1504 in cohorts of healthy male volunteers dosed at intervals of up to two-weeks. When target plasma levels have been reached, Chelsea will conduct a multiple dose evaluation of appropriate Phase II doses. Based on the anticipated schedule of the bioequivalence study, global Phase II trials in rheumatoid arthritis are expected to commence in the fourth quarter 2007.
As Chelsea proceeds in the clinical development of CH-1504 for rheumatoid arthritis, the company expects to continue to evaluate its potential in other indications. In particular, should an analysis of interim data from the Phase II study in rheumatoid arthritis be supportive, Chelsea plans to initiate a Phase II proof of concept trial in psoriasis in the second half of 2008.
I-3D
In May of 2006, Chelsea and Active Biotech signed an agreement for the co-development and commercialization of the I-3D portfolio, a group of orally active compounds that inhibit the enzyme dihydroorotate dehydrogenase (DHODH) for the treatment of autoimmune diseases and transplant rejection. At the time of the agreement, Active Biotech had already isolated more than 15 compounds and conducted extensive preclinical modeling resulting in the identification of two potential lead compounds. Pursuant to the agreement, a joint development committee was established to direct the continued development of I-3D compounds with the initial objective of selecting a lead compound with which to initiate Phase I clinical trials.
Having previously demonstrated proof of concept in both RA and transplant rejection animal models, the joint development committee selected AB-224050 as the first I-3D compound to undergo IND-enabling toxicology studies during the third quarter 2006. As part of the ongoing evaluation and preparation for Phase I trials, the joint development committee subsequently initiated a Phase 0 (micro-dosing) study to evaluate the half-life of AB-224050 in humans in the first quarter of 2007. Based on the results of the micro-dosing study and other ongoing preclinical activity, it has now been determined that, while demonstrating a significantly shorter half-life than Arava(r), AB-224050 will require additional work prior to the commencement of Phase I clinical trials. In 2007, the joint development committee plans to continue preclinical optimization of AB-224050 and conduct further comparisons of AB-224050 versus other compounds in the I-3D portfolio prior to initiating Phase I clinical trials. Accordingly, the I-3D Phase I program is not expected to commence earlier than 2008.
Conference Call Today at 4:30 PM EST
Chelsea will discuss its fourth quarter and full year financial results and provide an update on its clinical development programs in a conference call today at 4:30 PM Eastern Time. Those interested in hearing management's discussion can access the call directly by dialing 1-800-811-0667. International participants may access the call by dialing 913-981-4901. A replay will be available for one week following the call by dialing 1-888-203-1112 for domestic participants or 719-457-0820 for international participants and entering passcode 4147776 when prompted. Participants may also access both the live and archived webcast of the conference call through the investor relations section of Chelsea's web site at http://www.chelseatherapeutics.com. The webcast will remain available on the company's website until the next quarterly conference call.
About Chelsea Therapeutics
Chelsea Therapeutics is a biopharmaceutical development company that acquires and develops innovative products for the treatment of a variety of human diseases. The Company is currently developing a library of metabolically inert antifolate compounds engineered to have potent anti-inflammatory and anti-tumor activity to treat a range of immunological disorders. Early clinical data suggests that Chelsea's lead antifolate compound, CH-1504, is a safe and effective treatment alternative to methotrexate for RA and may have further applications for psoriasis, IBD and certain cancers. Chelsea's antifolate program is complemented by a strategic partnership with Active Biotech AB for the joint development of a portfolio of therapeutics targeting immune-mediated inflammatory disorders and transplantation. In addition to its autoimmune pipeline, Chelsea is developing Droxidopa, an orally active synthetic precursor of norepinephrine, for the treatment of neurogenic orthostatic hypotension. Currently approved and marketed in Japan, Droxidopa has accumulated over 15 years of proven safety and efficacy, historically generating annual revenues of approximately $50 million in Japan.
This press release contains forward-looking statements regarding future events. These statements are just predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include reliance on collaborations and licenses, risks and costs of drug development, regulatory approvals, intellectual property risks, our reliance on our lead drug candidate CH-1504, our history of losses and need to raise more money, competition, market acceptance for our products if any are approved for marketing, reliance on key personnel including specifically Dr. Pedder, management of rapid growth, the need to acquire or develop additional products and the other risk factors set forth from time to time in our SEC filings.
CHELSEA THERAPEUTICS INTERNATIONAL, LTD. AND SUBSIDIARY
(A Development Stage Company)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the three months For the years
ended December 31, ended December 31,
------------------------ -------------------------
2006 2005 2006 2005
----------- ----------- ----------- -----------
(unaudited) (unaudited)
Operating expenses:
Research and
development $ 1,989,386 $ 1,439,103 $ 6,864,357 $ 5,515,596
Sales and
marketing 181,595 132,757 642,263 524,597
General and
administrative 475,930 405,958 2,027,564 2,075,978
----------- ----------- ----------- -----------
Total operating
expenses 2,646,911 1,977,818 9,534,184 8,116,171
----------- ----------- ----------- -----------
Operating loss (2,646,911) (1,977,818) (9,534,184) (8,116,171)
Interest income 226,208 37,380 862,808 200,449
Interest expense -- -- -- --
----------- ----------- ----------- -----------
Net loss $(2,420,703) $(1,940,438) $(8,671,376) $(7,915,722)
=========== =========== =========== ===========
Net loss per basic
and diluted share
of common stock $ (0.12) $ (0.16) $ (0.46) $ (0.64)
=========== =========== =========== ===========
Weighted average
number of basic
and diluted
common shares
outstanding 19,707,129 12,383,188 18,780,638 12,321,061
=========== =========== =========== ===========
Chelsea Pharmaceuticals International, Ltd.
Condensed Consolidated Balance Sheet Data
(unaudited)
As of December 31,
----------------------
2006 2005
-------- --------
(in thousands)
Cash and cash equivalents $ 15,897 $ 3,173
Total assets 16,171 3,427
Total liabilities 2,034 1,043
Deficit accumulated during the
development stage (19,604) (10,932)
Stockholders' equity 14,137 2,384
To view the Notes to the Company's Financial Statements and Management's Discussion and Analysis, please see the Company's 2006 Annual Filings available on Chelsea's website at www.chelseatherapeutics.com