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Mirati Therapeutics Reports Second Quarter 2013 Financial Results

8/12/2013

San Diego, California, August 12, 2013 – Mirati Therapeutics, Inc. (“Mirati”) (NASDAQ: MRTX) today reported financial results for the second quarter and first six months ended June 30, 2013.

 

Corporate Highlights

  • During the quarter progress was made on objectives in all clinical development programs: optimized formulations of MGCD265 designed to maximize exposures were moved forward toward the clinic; IND enabling work was initiated on MGCD516, on target to initiate Phase I trials in early 2014; and significant progress was made towards a refined path forward for the clinical development of mocetinostat (MGCD0103).
  • On June 28, 2013 the arrangement agreement (“Arrangement”) between Mirati and MethylGene Inc. was completed in which MethylGene became a wholly-owned subsidiary of Mirati, a Delaware corporation.
  • On July 15, 2013 Mirati’s common stock began trading on the NASDAQ under the ticker symbol MRTX.

“During the first half 2013, we have transformed the company by building a world-class management team and focusing on our three molecularly targeted oncology programs in clinical development.  We are focused on execution of our development strategy in order to reach key milestones in 2013 and 2014,” said Dr. Charles Baum, President and CEO.

Second Quarter and First Six Months 2013 Financial Results

The Company’s financial statements for the period ended June 30, 2013 have been prepared in accordance with U.S. generally accepted accounting principles.

Net research and development expenditures for the second quarter of 2013 were $4.5 million, $858,000 higher than the second quarter of 2012. Increases were primarily due to costs relating to the ongoing formulation development for MGCD265 as well as costs associated with preparations for a potential mocetinostat study and an Investigational New Drug application for MGCD516. Increases were partially offset by reduced costs for the MGCD290 program which we are no longer actively pursuing internally, and increased investment tax credits due to a higher level of investment in research and development activities. Net research and development expenditures were $10.0 million for the first six months of 2013, compared to $5.9 million for the same period in 2012. Increases were primarily due to the factors listed above as well as costs associated with management changes implemented in the first quarter of 2013 and a reduction in investment tax credits versus the prior year. General and administrative expenses in the second quarter of 2013 were $2.4 million, $1.3 million higher than in the second quarter of 2012. General and administrative expenses were $4.9 million in the first six months, compared to $2.3 million for the same period in 2012. The increase is due primarily to costs incurred in connection with the Arrangement and NASDAQ listing as well as costs associated with management changes implemented in the first and second quarters of 2013.

There was a loss of $1.1 million in other (expense)/income in the second quarter of 2013 compared to income of $70,000 for the same period in 2012. The loss in 2013 is primarily reflected in a foreign exchange loss of $754,000, as well as a loss of $385,000 due to the change in fair value of our warrant liability. In the first six months of 2013 there was net income of $2.7 million compared to $138,000 for the same period in 2012. The increase primarily reflects a gain of $4.0 million from the change in fair value of our warrant liability, partially offset by a foreign exchange loss of $1.4 million. Foreign exchange losses in 2013 were primarily due to the transition to the U.S. dollar as the functional currency, effective January 1, 2013.

The net loss and comprehensive loss for the second quarter ended June 30, 2013 was $8.0 million, or ($0.81) per share, compared to a net loss and comprehensive loss of $4.7 million, or ($0.73) per share, for the same period last year. The net loss and comprehensive loss for the first six months of 2013 was $12.2 million, or ($1.23) per share, compared to a net loss and comprehensive loss of $8.0 million, or ($1.26) per share, for the same period in 2012.

Cash, cash equivalents, marketable securities and restricted cash totaled $20.6 million as at June 30, 2013 compared to $37.4 million on December 31, 2012. The Company believes it has sufficient financial resources to carry forward its current clinical development and operating plans into the second quarter of 2014.

About Mirati Therapeutics

Mirati Therapeutics is a publicly-traded biopharmaceutical company engaged in the development of novel therapeutics for the treatment of cancer patients. Our clinical development programs are focused on treating patients selected for tumors that are dependent on defined targets in order to most effectively address unmet patient needs. MGCD265 is a multi-targeted small molecule kinase inhibitor for treatment of oncology patients with solid tumors. MGCD265 is a highly selective and potent inhibitor of key pathways that drive tumor growth and spread. We are evaluating mocetinostat, a spectrum-selective HDAC inhibitor, for the treatment of patients with hematologic malignancies. Mocetinostat has demonstrated promising clinical activity in patients with myelodysplastic syndrome or lymphoma. In addition, MGCD516 is a unique kinase inhibitor with a distinct target profile that will begin Phase I studies to evaluate its potential for the treatment of patients with non-small cell lung cancer and other solid tumors. Mirati Therapeutics shares are traded on the NASDAQ (symbol “MRTX”).

Notice to Investors

This news release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any securities.

MIRATI THERAPEUTICS, INC. CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

(Unaudited)

 

 

June 30,
2013

 

December 31,
2012

 

ASSETS  

 

     
Current assets  

 

     
Cash and cash equivalents   $

9,740

  $

18,403

 
Marketable securities  

10,516

 

18,580

 
Restricted cash equivalents and   marketable securities  

285

 

302

 
Interest and other receivables  

108

 

507

 
Other current assets  

1,787

 

1,537

 
Total current assets  

22,436

 

39,329

 
           
Security deposits  

101

 

67

 
Restricted cash equivalents and marketable securities  

78

 

72

 
Property and equipment, net  

425

 

333

 
Total assets   $

23,040

  $

39,801

 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current liabilities          
Accounts payable and accrued   liabilities  

4,516

 

5,272

 
Current portion of other liability  

68

 

68

 
Warrant   liability  

12,208

 

 
Total current liabilities  

16,792

 

5,340

 
           
Other liability  

11

 

45

 
Total liabilities  

16,803

 

5,385

 
           
Stockholders’ equity          
Preferred stock, $0.001 par value,   10,000,000 shares authorized; none issued and outstanding at both   June 30, 2013 and December 31, 2012  

 

 
Common stock, $0.001 par value;   100,000,000 authorized; 9,957,725 issued and outstanding at both June 30,   2013 and December 31, 2012  

10

 

10

 
Warrants  

 

11,153

 
Additional paid-in capital  

154,469

 

154,224

 
Accumulated other comprehensive income  

9,520

 

9,520

 
Accumulated deficit  

(157,762)

 

(140,491)

 
Total stockholders’ equity  

6,237

 

34,416

 
Total liabilities and stockholders’   equity   $

23,040

  $

39,801

 


MIRATI THERAPEUTICS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands except for share and per share amounts)

(Unaudited)

   

Three months ended June 30,

 

Six months ended June 30,

 
   

2013

 

2012

 

2013

 

2012

 
Expenses                  
Research and development, net  

$

4,510

  $

3,652

 

$9,985

  $

5,856

 
General and administrative  

 2,382

 

1,082

 

4,906 

 

2,302

 
Total operating expenses  

 6,892

 

4,734

 

14,891 

 

8,158

 
Loss from operations  

 (6,892)

 

 (4,734)

 

(14,891)

 

(8,158)

 
Other (expense) income, net  

(1,079)

 

 70

 

2,722 

 

138

 
Loss before income taxes  

(7,971)

 

 (4,664)

 

(12,169)

 

(8,020)

 
Income tax expense  

41 

 

 13

 

60 

 

13

 
Net loss and comprehensive loss  

$

(8,012)

  $

( 4,677)

  $

(12,229)

  $

(8,033)

 
Basic and diluted net loss per   share  

$

(0.81)

  $

(0.73)

  $

(1.23)

  $

(1.26)

 
Weighted average   number of shares used in computing net loss per share, basic and diluted  

9,957,725

 

6,358,266

 

9,957,725

 

6,358,266

 

 

 
Investor Relations Contacts

Mark J. Gergen
Executive Vice President & COO
Mirati Therapeutics, Inc.
Tel.: 858.535.2075
ir@mirati.com
mirati.com

Michael Wood
Managing Director
LifeSci Advisors
Tel.: 646.597.6983
mwood@lifesciadvisors.com
www.lifesciadvisors.com


Tracey Rowlands, PhD
Director of Investor Relations and Business Development
Mirati Therapeutics, Inc.
Tel.: 514.337.3333 ext. 512
ir@mirati.com
mirati.com

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