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Akebia narrows loss, projects cash through 2Q 2019

August 13, 2017

Akebia Therapeutics, Inc. (AKBA), a biopharmaceutical company focused on delivering innovative therapies to patients with kidney disease through the biology of hypoxia-inducible factor (HIF), today announced financial results for the second quarter ended June 30, 2017.

“Akebia continues to maximize the potential of vadadustat through value-enhancing deals and executing on our clinical development program,” said John P. Butler, President and Chief Executive Officer of Akebia. “Our agreement with Vifor Pharma establishes vadadustat as its exclusive HIF product for distribution to Fresenius Medical Care, the largest kidney dialysis provider in the U.S., following FDA approval. In addition, we initiated our Phase 2 FO2RWARD study in patients with renal anemia who are hyporesponsive to erythropoiesis-stimulating agents, and plan to start our Phase 3 TRILO2GY trial in the second half of the year to confirm previous positive results of vadadustat administered on a three-times-weekly basis. Topline data from both of these studies are expected by the end of 2018, followed by results from our global Phase 3 program for vadadustat.”

Mr. Butler added, “Substantial financial commitments from our collaborators, together with our existing cash, position Akebia well in advance of multiple value-creating events anticipated over the next 12-18 months, including filing an IND for AKB-5169, our HIF product candidate for inflammatory bowel disease, in the first half of next year.”

Second Quarter 2017 and Recent Corporate Highlights

  • Entered into an exclusive license agreement with Vifor Pharma to sell vadadustat as its only HIF product for distribution to Fresenius Medical Care in the U.S., a kidney dialysis provider serving approximately 40% of dialysis patients, following approval of vadadustat by the U.S. Food and Drug Administration (FDA). The profit-sharing arrangement is based on inclusion of vadadustat in a bundled reimbursement model, which will generate a $20 million payment to Akebia from Vifor Pharma. Separately, Vifor Pharma made a $50 million equity investment in Akebia;
  • Dosed the first patient in the randomized, open-label Phase 2 FO2RWARD study of vadadustat in dialysis-dependent chronic kidney disease patients who are hyporesponsive to erythropoiesis-stimulating agents (ESAs). Akebia expects to report data from FO2RWARD by the end of 2018;
  • Prevailed in two additional European Patent disputes in which the Opposition Division of the European Patent Office revoked another FibroGen, Inc. HIF-related patent in Europe, and another of their patents was significantly narrowed to cover only an indication for which Akebia is not intending to develop vadadustat;
  • Appointed Rita Jain, M.D. as Senior Vice President and Chief Medical Officer to lead the global development program for vadadustat and the clinical development of Akebia’s growing HIF pipeline;
  • Raised approximately $67 million through an underwritten public offering of common stock and full exercise of the underwriters’ option to purchase additional shares; and
  • Otsuka Pharmaceutical Co. Ltd. waived its option, in advance of its expiration, to convert its U.S. arrangement with Akebia from a profit share to a right to receive royalties.

Financial Results

Akebia reported a net loss of ($21.5) million, or ($0.53) per share, for the second quarter of 2017 as compared to a net loss for the second quarter of 2016 of ($35.8) million or ($0.95) per share.

Collaboration revenue was $28.5 million for the second quarter of 2017, which related to the Company’s agreements with Otsuka. Collaboration revenue in connection with Akebia’s agreement with Mitsubishi Tanabe Pharma Corporation is expected to commence in the second half of 2017.

Research and development expenses were $43.8 million for the second quarter of 2017 compared to $30.9 million for the second quarter of 2016. The increase is primarily attributable to external costs related to the global PRO2TECT and INNO2VATE Phase 3 programs, as well as the FO2RWARD and TRILO2GY studies. Research and development expenses were further increased by headcount and compensation-related costs.

General and administrative expenses were $6.9 million for the second quarter of 2017 compared to $5.3 million for the second quarter of 2016. The increase is primarily attributable to an increase in costs to support the Company’s research and development programs, including headcount and compensation-related costs and associated facility costs.

Akebia ended the second quarter of 2017 with cash, cash equivalents and marketable securities of $321.2 million, which included a $50.0 million equity investment from Vifor Pharma. In July 2017, the Company raised approximately $67.0 million from a follow-on offering. The Company’s collaborators have committed up to $373.0 million or more in license and cost-share funding, which Akebia continues to receive on a quarterly prepaid basis. Akebia expects existing cash resources, including net proceeds from the July 2017 follow-on offering and the timing of committed research and development funding from its collaborators to fund the Company’s current operating plan into the second quarter of 2019. Thereafter, committed research and development funding will continue to be received from Otsuka on a prepaid, quarterly basis.

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