Akebia Therapeutics Inc. (NASDAQ:AKBA)

Discussion in 'Men's Economics' started by Michael Scally MD, Apr 25, 2015.

  1. Michael Scally MD

    Michael Scally MD Doctor of Medicine

    Akebia Therapeutics Inc. (NASDAQ:AKBA)

    Akebia Therapeutics Announces Closing of Public Offering and Full Exercise of Underwriters' Option to Purchase Additional Shares

    CAMBRIDGE, Mass., Apr 22, 2015 (BUSINESS WIRE) -- Akebia Therapeutics, Inc. AKBA, -0.91% today announced the closing of its public offering of 8,363,636 shares of common stock at a public offering price of $8.25 per share. This includes the exercise in full by the underwriters of their option to purchase 1,090,909 shares of common stock. The aggregate net proceeds to Akebia, after underwriting discounts and commissions and estimated offering expenses, are approximately $64.6 million. All of the shares of common stock were offered by Akebia.

    Akebia Therapeutics, Inc. is a United States-based biopharmaceutical company, which is focused on the development of therapeutics based on hypoxia-inducible factor (HIF) biology and the commercialization of these products for patients with kidney disease. The Company’s product candidate, AKB-6548, is in a Phase-IIb clinical trial in patients with anemia secondary to chronic kidney disease who are not dependent on dialysis. AKB-6548 is being developed as a once-daily, oral therapy to inhibit hypoxia-inducible factor prolyl hydroxylase, which is expected to stabilize and increase levels of HIFα and improve the production of hemoglobin and red blood cells. AKB-6899 is its second hypoxia inducible factor-prolyl hydroxylase (HIF-PH) inhibitor product candidate.

    AKBA independent director buys $3.5M of stock on open market:
  2. Michael Scally MD

    Michael Scally MD Doctor of Medicine

    They have ~$165 million in cash with a market cap $240 million.

    First Quarter 2015 and Recent Corporate Highlights
    • Presented positive results from the Phase 2b study of AKB-6548 in non-dialysis patients with anemia related to chronic kidney disease (CKD) at the International Society of Nephrology's biennial World Congress of Nephrology, demonstrating that treatment with AKB-6548 controlled hemoglobin (HGB) levels in a sustained manner and in a clinically relevant range and produced a coordinated physiologic response to resolve anemia, while avoiding excessive fluctuations in HGB levels which have been associated with increased cardiovascular risks;
    • Completed enrollment of the Phase 2 study of AKB-6548 in patients with anemia related to CKD who are undergoing hemodialysis, designed to evaluate the safety, efficacy and tolerability of AKB-6548. Two dosing regimens of either daily or three times per week are being studied, potentially offering a flexible dosing regimen to optimize patient convenience and adherence; and
    • Raised approximately $65 million, net, in a follow-on public offering of approximately 8.4 million shares of common stock, including the full exercise of the underwriters' option to purchase an additional 1.1 million shares.

    Financial Results

    Akebia reported a net loss and a net loss applicable to common stockholders of $10.7 million, or ($0.53) per share, for the first quarter of 2015. Net loss applicable to common stockholders for the first quarter of 2014, which includes accretion on preferred stock of $86.9 million, was $96.6 million or ($43.37) per share.

    In connection with the closing of the company's initial public offering on March 25, 2014, all of the company's outstanding shares of preferred stock were converted into shares of common stock and accordingly the accretion on the preferred stock ceased as of such date.

    Research and development expenses were $7.5 million for the first quarter of 2015 compared to $6.2 million for the first quarter of 2014. The increase is primarily attributable to costs related to AKB-6548, including the Phase 2 study for the treatment of anemia in patients undergoing dialysis, and manufacturing costs. Research and development expenses were further increased by wage and personnel-related costs due to increased headcount, and drug development costs for AKB-6899.

    General and administrative expenses were $3.4 million for the first quarter of 2015 compared to $3.8 million for the first quarter of 2014. The decrease in general and administrative expenses is primarily related to decreased stock-based compensation expense, partially offset by increased wage and personnel-related costs due to increased headcount, and commercial planning costs.

    The company's cash used in operations during the first quarter of 2015 was $8.3 million, an increase of $2.3 million from $6.0 million for the same period of 2014. The company ended the first quarter of 2015 with cash, cash equivalents and available for sale securities of $100.3 million and expects its existing cash resources and net proceeds from the follow-on offering in April 2015 to support operations into the fourth quarter of 2016.

    Akebia Shares Could More Than Double in a Year

    We are initiating coverage of Akebia Therapeutics with a Buy rating and a 12-month target price of $18.

    AKB-6548 is Akebia’s (ticker: AKBA ) leading small molecule oral drug being developed for anemia secondary to chronic kidney disease (CKD), and we believe it has the potential to expand the market for anemia in nondialysis CKD patients and replace erythropoietin-stimulating agents (ESAs) as standard of care for anemia in dialysis CKD patients.