CAMBRIDGE, Mass.--(Vertex Pharmaceuticals Incorporated (Nasdaq: VRTX) today announced that it plans to initiate a Phase 2 proof-of-concept clinical trial for VX-509, a novel and highly selective inhibitor of Janus kinase 3 (JAK3). The 12-week trial is expected to enroll approximately 200 patients with moderate to severe rheumatoid arthritis (RA). Vertex expects to initiate the trial in the first quarter of 2010 and to obtain interim clinical data from this trial, including measurements of safety, tolerability and clinical activity, by mid-2010.)--
“I thank Kurt for his efforts to build Vertex’s commercial infrastructure over the past two years. Today, Vertex is well-positioned to advance telaprevir toward commercialization, and I wish Kurt well in his future endeavors.”
Vertex also today updated guidance for its 2009 year-end cash position and net loss. The updated financial guidance reflects Vertex’s strengthened cash position resulting from business development activities conducted in the third quarter of 2009, including the expected receipt of $155 million cash related to future telaprevir milestone payments, announced today in a separate press release, and a $105 million payment received from Mitsubishi Tanabe Pharma Corporation related to an amended agreement for the development and commercialization of telaprevir in Japan and certain Far East countries. These business development activities will result in the addition of $260 million in cash to Vertex’s June 30, 2009 cash, cash equivalents and marketable securities position of $754 million. Vertex now expects to end 2009 with approximately $800 million of cash, cash equivalents and marketable securities. In addition, Vertex today updated its guidance for 2009 non-GAAP and GAAP net loss.
“Vertex is committed to becoming a major, fully-capable biopharmaceutical company and is leading the development of late-stage drug candidates aimed at the treatment of hepatitis C virus infection and cystic fibrosis,” said Matthew Emmens, chairman, president and chief executive officer of Vertex Pharmaceuticals. “Our top priority remains the execution of the Phase 3 registration program for telaprevir in HCV, and we remain on track to submit a New Drug Application for telaprevir in the second half of next year. Beyond telaprevir, the planned initiation of a Phase 2 trial for VX-509 is another important step toward advancing our business while still maintaining a strong financial position as we enter 2010.”
Vertex also today announced that Kurt Graves will resign his position with the company effective Friday, October 2, 2009. Mr. Graves joined Vertex in July 2007 and most recently held the title of executive vice president, chief commercial officer and head, strategic development.
Mr. Emmens continued, “I thank Kurt for his efforts to build Vertex’s commercial infrastructure over the past two years. Today, Vertex is well-positioned to advance telaprevir toward commercialization, and I wish Kurt well in his future endeavors.”
VX-509 Phase 2 Proof-of-Concept Trial
The Phase 2 proof-of-concept trial announced today for VX-509 is expected to enroll approximately 200 patients with moderate to severe RA. The double-blind, randomized, placebo-controlled trial will evaluate the safety, tolerability and clinical activity of VX-509 dosed for 12 weeks compared to placebo. The primary endpoints of the trial are to evaluate safety and to measure the improvement in clinical signs and symptoms of RA in patients after 12 weeks of treatment. Efficacy assessments will include the American College of Rheumatology criteria (ACR20, ACR50 and ACR70) for defining clinical improvement in RA patients. ACR20, ACR50 and ACR70 are standardized measures of the number of patients who achieve at least a 20, 50 or 70 percent improvement, respectively, in ACR-specified measures of RA activity. The trial will also utilize disease activity score (DAS) and European League Against Rheumatism (EULAR) response criteria as additional efficacy assessments.
Vertex expects to initiate the trial in the first quarter of 2010, which the company believes will result in interim clinical data, including measurements of safety, tolerability and clinical activity, being available by mid-2010. Vertex plans to pursue collaborative opportunities for VX-509 with major pharmaceutical companies to more fully capture the potential value of the compound across multiple immune-mediated inflammatory diseases. Vertex expects that any ongoing or future out-licensing activities for VX-509 will conclude during 2010, providing potential future sources of revenue and cash flow.
About JAK3 and VX-509
Janus kinase 3 is an enzyme that plays a critical role in the cell signaling process that results in the development of T-lymphocytes, which are white blood cells that are part of the body’s immune system. Based on the known activity of JAK3 on the immune system, it is believed that inhibitors of JAK3 may play a role in the treatment of a variety of immune-mediated diseases such as rheumatoid arthritis, psoriasis and others.
In in vitro studies, VX-509 was greater than 1000-fold more selective for JAK3 compared to non-JAK kinases and approximately 25- to 150-fold more selective for JAK3 compared to other JAK isotypes in cell-based assays. Results from two Phase 1, dose-ranging studies of VX-509 of up to 14 days duration in healthy volunteers completed in the first quarter showed no dose-limiting toxicities. Data from these Phase 1 studies also showed a profound dose-dependent and reversible reduction in PSTAT-5, a specific biomarker of JAK3 activity, and a high degree of selectivity for JAK3 over JAK2, consistent with observations from previous in vitro studies.
2009 Financial Guidance
As a result of the expected addition of $260 million of cash from business development activities conducted in the third quarter, Vertex is today updating its guidance for year-end cash, cash equivalents and marketable securities from approximately $700 million to approximately $800 million. Vertex is also updating its guidance for 2009 non-GAAP loss to approximately $535 million. As a result, the company expects its 2009 GAAP loss to be approximately $650 million. Vertex’s increased guidance for 2009 non-GAAP and GAAP loss results primarily from the decision to retain VX-509 for Phase 2 clinical development. This updated guidance does not anticipate further contribution of cash or revenue from new business development or out-licensing activities in 2009. Vertex’s guidance for GAAP loss includes an estimate of approximately $115 million in restructuring expense, acquisition-related expenses, executive transition expenses, stock-based compensation expense and loss on exchange of convertible subordinated notes.
“After the completion of key business development activities conducted in the third quarter, which will add $260 million to Vertex’s June 30, 2009 cash position of $754 million, we now expect to end the year with approximately $800 million in cash, cash equivalents and marketable securities,” said Ian Smith, executive vice president and chief financial officer of Vertex. “This strengthened financial position enables the continued investment in the telaprevir registration program as well as investment in multiple other development programs, including the Phase 3 program for VX-770 in cystic fibrosis and now the first proof-of-concept trial of VX-509 in RA.”
Phase 3 Programs in HCV and CF on Track
Non-GAAP Financial Measures
In this press release, Vertex's guidance is provided both in accordance with accounting principles generally accepted in the United States (GAAP) and using certain non-GAAP financial measures. In particular, Vertex provides its guidance for its projected 2009 loss, excluding restructuring expense, acquisition-related expenses, executive transition expenses, stock-based compensation expense and loss on exchange of convertible subordinated notes, which in each case results in a non-GAAP financial measure. This guidance is provided as a complement to the GAAP guidance because management believes these non-GAAP financial measures help indicate underlying trends in the company's business, are important in comparing current results with prior period results and provide additional information regarding its financial position. Management also uses non-GAAP financial measures to establish budgets and operational goals that are communicated internally and externally, and to manage the company's business and to evaluate its performance.
Vertex Pharmaceuticals Incorporated is a global biotechnology company committed to the discovery and development of breakthrough small molecule drugs for serious diseases. The company's strategy is to commercialize its products both independently and in collaboration with major pharmaceutical companies. Vertex's product pipeline is focused on viral diseases, cystic fibrosis, inflammation, autoimmune diseases, cancer, and pain.
Vertex co-discovered the HIV protease inhibitor, Lexiva, with GlaxoSmithKline.
Lexiva is a registered trademark of the GlaxoSmithKline group of companies.
Vertex's press releases are available at www.vrtx.com
Special Note Regarding Forward-looking Statements
This press release contains forward-looking statements, including statements regarding (i) the planned initiation of a Phase 2 proof-of-concept clinical trial for VX-509 in approximately 200 patients in the first quarter of 2010, (ii) the expectation that interim clinical data, including measurements of safety, tolerability and clinical activity, from the Phase 2 trial of VX-509 will be available by mid-2010, (iii) the company’s expectation that it will receive a total of $155 million related to future telaprevir milestone payments and that it will end 2009 with approximately $800 million in cash, cash equivalents and marketable securities and will maintain a strong financial position entering 2010, (iv) the company’s commitment to building a fully-capable biopharmaceutical company, (v) the company remaining on track to submit a New Drug Application for telaprevir in the second half of 2010 and the company being well-positioned to advance telaprevir toward commercialization, (vi) the anticipated design for the Phase 2 clinical trial for VX-509, including anticipated number of patients and primary and secondary endpoints, (vii) the company’s plans to pursue collaborative opportunities for VX-509 with major pharmaceutical companies to more fully capture the potential value of the compound across multiple immune-mediated inflammatory diseases and the company’s expectation that ongoing or future out-licensing activities for VX-509 will conclude during 2010, providing potential future sources of revenue and cash flow, (viii) the company’s projections that its 2009 non-GAAP and GAAP net losses will be approximately $535 million and approximately $650 million, respectively, (ix) the updated guidance not anticipating further contribution of cash or revenue from new business development or out-licensing activities in 2009, (x) the estimate that the company’s GAAP guidance will include approximately $115 million in restructuring expense, acquisition-related expenses, executive transition expenses, stock-based compensation expense and loss on exchange of convertible subordinated notes, (xi) the company’s belief that its financial position will enable the continued investment in the telaprevir registration program and other development programs in cystic fibrosis and rheumatoid arthritis, (xii) expectations regarding when sustained viral response data will be available from the ADVANCE, ILLUMINATE and REALIZE clinical trials, (xiii) the belief that inhibitors of JAK3 may play a role in the treatment of a variety of immune-mediated diseases such as rheumatoid arthritis, psoriasis and others, and (xiv) the possibility that VX-509 may have broad potential for the treatment of multiple immune-mediated inflammatory diseases. While the company believes the forward-looking statements contained in this press release are accurate, there are a number of factors that could cause actual events or results to differ materially from those indicated by such forward-looking statements. Those risks and uncertainties include, among other things, that the outcomes for each of its planned or ongoing clinical trials and studies, and in particular its clinical trials of telaprevir and its planned Phase 2 clinical trial of VX-509, may not be favorable, that regulatory authorities may require supplemental clinical trials in order to support registration of telaprevir in any particular indication, that there may be varying interpretations of data produced by one or more of the clinical trials, that enrollment may be more difficult or slower than the company currently anticipates or that planned clinical trials may not start when planned, that regulatory authorities will require more extensive data for a telaprevir NDA filing than currently expected, that in vitro data and data from clinical trials in a limited number of healthy volunteers may not be predictive of data that will be obtained in future clinical trials of VX-509, that one or more of the company's assumptions underlying its revenue expectations or its expense expectations will not be realized, that the company will be unable to realize one or more of its financial objectives for 2009 due to unexpected and costly program delays, or any number of other financial, technical or collaboration considerations, that unexpected costs associated with one or more of the company's programs will necessitate a reduction in its investment in other programs or a change in the company's financial projections, that future competitive or other market factors may adversely affect the commercial potential for the company's product candidates in HCV or other potential indications, that due to scientific, medical or technical developments, the company's drug discovery efforts will not ultimately result in commercial products or assets that can generate revenue, that the company will be unable to enter into new collaborative relationships on acceptable terms, and other risks listed under Risk Factors in Vertex's annual report and quarterly reports filed with the Securities and Exchange Commission and available through the company's website at www.vrtx.com. The company disclaims any obligation to update the information contained in this press release as new information becomes available.
Vertex Pharmaceuticals will host an investor conference call today, September 30, 2009 at 4:30 p.m. ET. To listen to the call on the telephone, dial (800) 374-0296 (U.S. and Canada) or (702) 696-4937 (International) and use the conference ID 32763023. The call will be available for replay via telephone commencing September 30, 2009 at 4:30 p.m. ET running through 11:59 p.m. ET on October 6, 2009. The replay phone number for the U.S. and Canada is (800) 642-1687 and the international replay number is or (706) 645-9291. The conference ID number is 32763023. Vertex is also providing a podcast MP3 file available for download on the Vertex website at www.vrtx.com.
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