Facing lower-than-expected sales of its antibiotics and higher costs, New Haven’s Melinta Therapeutics Inc. said it will outsource research and development activities in 2019 and cut other expenses in an effort to save more than $50 million.
“We are taking deliberate and decisive steps to accelerate sales, lower costs and optimize cash,” said interim CEO John Johnson in a statement. “We have much work ahead, but we are moving forward with urgency to drive profitable growth and shareholder value.”
The announcement came as the company reported third-quarter financial results last week showing wider losses compared to a year ago.
For the period ended Sept. 30., Melinta reported a net loss of $27.9 million, compared to $19.6 million for the same period in 2017. The company reported $34.1 million in third-quarter revenue.
R&D costs were $13.1 million for the quarter, up from $10.9 million during the third quarter of 2017. Selling, general and administrative costs were $34.3 million, up from $10.3 million a year ago.
Melinta attributed the increase to costs associated with acquiring the infectious disease arm of New Jersey’s The Medicine Co. this year, as well as its merger with competitor Cempra.
In a conference call with investors, Johnson said Melinta plans to scale back its R&D investment and is seeking strategic partners to take on discovery research in 2019.
He said the company also plans to refocus its sales and marketing dollars to areas with potential for the highest return.
Despite the challenges, Johnson, who replaced CEO Dan Weschler after his unexpected resignation last month, said the company hit several key milestones during the quarter.
They include positive results in a study of its antibiotic Baxdela for the treatment of community-acquired bacterial pneumonia; an international marketing deal with the Menarini Group for newly acquired antibiotics Vabomere, Orbactiv and Minocin; and a positive regulatory recommendation for five new uses for Vabomere in Europe.
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New Haven-based BioXcel Therapeutics Inc. reported higher third-quarter losses in 2018 compared to a year ago as it poured more money into research and development for its drugs targeting dementia and cancer.
For the period ended Sept. 30, the clinical-stage company posted a net loss of $4.9 million, compared to $900,000 for the same period in 2017.
The losses come as BioXcel’s R&D expenses rose to $3.8 million for the quarter, up from $600,000 a year ago.
The bulk of the increase stemmed from R&D on the company’s two lead drug candidates, BioXcel said. BXCL501, an under-the-tongue version of an older FDA-approved injectable drug known as Dex (dexmedetomidine), is being redeveloped to calm agitation in dementia patients, and BXCL701, is an oral immunotherapy drug targeting prostate and pancreatic cancer.
BioXcel said it completed manufacturing of both drugs during the quarter and expects to launch new clinical trials on each by the end of the year.
“We have made tremendous progress during the past quarter that we believe is truly transformational for BTI,” Vimal Mehta, president and CEO, said in a statement. “We are well-positioned to execute on our clinical programs across our two primary areas of focus.”
The company said it still has $47.1 million in cash after raising $60 million in an initial public offering in March.
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The Leukemia & Lymphoma Society has awarded a five-year, $625,000 matching grant to Amer Zeidan, a researcher with the Yale Cancer Center, for his work on treatments for myelodysplastic syndromes and chronic myeloid leukemia (CML).
In his work on MDS, which often progresses to acute myeloid leukemia, Zeidan is testing the combination of an immune checkpoint inhibitor (a therapy that targets the proteins that allow cancer cells to evade the immune system) with a histone deacetylase (HDAC) inhibitor called entinostat. (HDACs are enzymes that play a role in regulating cell signaling and behavior.)
For CML, Zeidan is testing whether adding an immune checkpoint inhibitor to the current daily treatment for CML patients can eradicate cancer cells enough to allow them eventually to discontinue therapy.
The society is providing $312,500 through the grant, which will be matched by Yale New Haven Health.
Contact Natalie Missakian at news@newhavenbiz.com
