BOSTON, May 15, 2019 /PRNewswire/ -- Stealth BioTherapeutics Corp (NASDAQ: MITO), a clinical-stage biotechnology company focused on the discovery, development and commercialization of novel therapies for diseases involving mitochondrial dysfunction, today reported financial results for the quarter ended March 31, 2019.
"We expect 2019 to be a transformational year for Stealth and believe the milestones achieved during the first quarter attest to our ability to execute through this exciting period," said Reenie McCarthy, Chief Executive Officer at Stealth. "We opened the first quarter with our initial public offering, providing the foundation to implement our clinical strategy. During the quarter, we successfully initiated and dosed the first patient in our ReCLAIM-2 Phase 2b study in dry age-related macular degeneration with geographic atrophy and, more recently, announced completion of enrollment for our pivotal MMPOWER-3 study in primary mitochondrial myopathy. We look forward to sharing more news throughout 2019, including top-line data from MMPOWER-3 expected by year end."
First Quarter 2019 and Recent Highlights
Key Upcoming Milestones
Financial Results for the Quarter Ended March 31, 2019
Cash Position: Cash and cash equivalents were $70.5 million at March 31, 2019, compared to $10.9 million at December 31, 2018. During the first quarter of 2019, the Company raised $76.9 million of net proceeds from its IPO.
Research and Development (R&D) Expenses: R&D expenses were $14.3 million for the first quarter of 2019, compared to $13.4 million for the first quarter of 2018. This increase was primarily due to a $1.7 million increase in headcount and consulting-related expenses as we continued to build our clinical, medical affairs and regulatory functions and a $1.1 million increase in contract manufacturing expenses for NDA-enabling activities, offset by a decrease of $1.9 million in clinical trial costs.
General and Administrative (G&A) Expenses: G&A expenses were $4.2 million for the first quarter of 2019, compared to $3.5 million for the first quarter of 2018. The increase in administrative expenses of $0.7 million was primarily attributable to an increase in pre-commercial activities, including medical affairs, marketing and payer reimbursement activities and expenses related to public company activities, including director fees, and directors' and officers' liability insurance.
Other expense, net: Other first quarter expense of $24.7 million, compared to $3.4 million for the first quarter of 2018, was primarily attributable to a non-cash $22.7 million loss on extinguishment of debt due to the conversion of convertible notes into ordinary shares in connection with our IPO and a $1.3 million increase in interest expense associated with the notes, offset by $2.7 million of other income due to the change in fair value of the derivative liability associated with the notes.
Net Loss: Net loss for the first quarter of 2019 was $43.2 million, or $0.20 basic and diluted net loss per ordinary share, as compared to $20.3 million for the first quarter of 2018, or $0.30 basic and diluted net loss per ordinary share. The increased loss was primarily attributable to the aforementioned $22.7 million non-cash loss associated with the conversion of convertible notes.
We are a clinical-stage biotechnology company focused on the discovery, development and commercialization of novel therapies for diseases involving mitochondrial dysfunction. Mitochondria, found in nearly every cell in the body, are the body's main source of energy production and are critical for normal organ function. Dysfunctional mitochondria characterize a number of rare genetic diseases, collectively known as primary mitochondrial diseases, and are also involved in many common age-related diseases. We believe our lead product candidate, elamipretide, has the potential to treat both rare genetic and common age-related mitochondrial diseases. We are studying elamipretide in the following primary mitochondrial diseases: primary mitochondrial myopathy, Barth syndrome and Leber's hereditary optic neuropathy. We are also studying elamipretide in dry age-related macular degeneration. Our other pipeline candidates include SBT-272, which we are evaluating for rare neurodegenerative disease indications, and SBT-20, which we are evaluating for rare peripheral neuropathies. We have optimized our discovery platform to identify novel mitochondrial-targeted compounds, which may be nominated as therapeutic product candidates or utilized as scaffolds to deliver other compounds to mitochondria. We have assembled a highly experienced management team, board of directors and group of scientific advisors to help us achieve our mission of leading mitochondrial medicine.
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Such forward-looking statements include those regarding Stealth BioTherapeutics' plans, strategies and expectations for its preclinical and clinical advancement of its drug development programs, including its ongoing clinical trials of elamipretide and planned clinical trial of SBT-272; the potential benefits of Stealth BioTherapeutics' product candidates; its key milestones for 2019; and its plans regarding future data presentations and regulatory interactions. Statements that are not historical facts, including statements about Stealth BioTherapeutics' beliefs, plans and expectations, are forward-looking statements. The words "anticipate," "expect," "hope," "plan," "potential," "possible," "will," "believe," "estimate," "intend," "may," "predict," "project," "would" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Stealth BioTherapeutics may not actually achieve the plans, intentions or expectations disclosed in these forward-looking statements, and you should not place undue reliance on these forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements as a result of known and unknown risks, uncertainties and other important factors, including: Stealth BioTherapeutics' ability to obtain additional funding; the ability to successfully demonstrate the efficacy and safety of Stealth BioTherapeutics' product candidates and future product candidates; the preclinical and clinical results for Stealth BioTherapeutics' product candidates, which may not support further development and marketing approval; the potential advantages of Stealth BioTherapeutics' product candidates; the content and timing of decisions made by the U.S. FDA, the EMA or other regulatory authorities, investigational review boards at clinical trial sites and publication review bodies, which may affect the initiation, timing and progress of preclinical studies and clinical trials of Stealth BioTherapeutics' product candidates; Stealth BioTherapeutics' ability to obtain and maintain requisite regulatory approvals and to enroll patients in its planned clinical trials; unplanned cash requirements and expenditures; competitive factors; Stealth BioTherapeutics' ability to obtain, maintain and enforce patent and other intellectual property protection for any product candidates it is developing; and general economic and market conditions. These and other risks are described in greater detail under the caption "Risk Factors" included in Stealth BioTherapeutics' most recent Annual Report on Form 20-F filed with the Securities and Exchange Commission ("SEC"), as well as in any future filings with the SEC. Forward-looking statements represent management's current expectations and are inherently uncertain. Except as required by law, Stealth BioTherapeutics does not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances.
Kate Contreras, 617-520-7088
Stern Investor Relations
Lauren Stival, 212-362-1200
STEALTH BIOTHERAPEUTICS CORP
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STEALTH BIOTHERAPEUTICS CORP
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