UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): March 13, 2018
AERPIO PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 000-53057 | 61-1547850 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| 9987 Carver Road Cincinnati, OH |
45242 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code (513) 985-1920
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒
| Item 2.02 | Results of Operations and Financial Condition |
On March 13, 2018, Aerpio Pharmaceuticals, Inc. announced its financial results for the fiscal year ended December 31, 2017. A copy of the press release is being furnished as Exhibit 99.1 to this Report on Form 8-K.
The information in this Report on Form 8-K and Exhibit 99.1 attached hereto is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit No. |
Description | |
| 99.1 | Press release issued by Aerpio Pharmaceuticals, Inc. on March 13, 2018 furnished herewith. | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: March 13, 2018 | AERPIO PHARMACEUTICALS, INC. | |||||
| By: | /s/ Stephen Hoffman | |||||
| Stephen Hoffman | ||||||
| Chief Executive Officer | ||||||
Exhibit 99.1
Aerpio Reports Fourth Quarter and Full Year 2017 Financial Results and Provides Business Update
TIME-2b Clinical Trial of AKB-9778 in Patients with Diabetic Retinopathy Remains on Track
Conference Call and Webcast Today, March 13th at 8:30 a.m. ET
CINCINNATI— Aerpio Pharmaceuticals, Inc. (OTCQB:ARPO), a biopharmaceutical company focused on advancing first-in-class treatments for ocular diseases, today reported financial results for the fourth quarter and full year ended December 31, 2017.
“Over the past year, Aerpio has made tremendous progress in the development of AKB-9778, our first-in- class Tie2-activator,” said Stephen Hoffman, MD, PhD, Chief Executive Officer of Aerpio. “In June 2017, we initiated our TIME-2b Phase 2b study in patients with non-proliferative diabetic retinopathy (NPDR). The ability to delay or reverse the progression of NPDR to sight-threatening conditions, such as proliferative diabetic retinopathy and diabetic macular edema, is a significant unmet medical need. We have been very encouraged by the clinical community’s interest in AKB-9778’s differentiated mechanism of action, its subcutaneous route of administration, and potential to treat multiple diabetic vascular comorbidities. In fact, we announced last month that we had completed enrollment in TIME-2b three months earlier than originally projected. We also recently reported preliminary data supporting the potential of AKB-9778 to protect the kidney vasculature in patients with diabetes. Additionally, based on findings from our previous Phase 2 trial with AKB-9778, we plan to begin clinical development for an eye drop formulation of AKB-9778 to treat primary open angle glaucoma within the next year.”
Recent Company Highlights
| • | Completed enrollment in the TIME-2b study, a Phase 2b clinical trial designed to assess the efficacy and safety of the Company’s lead candidate, AKB-9778, for patients with moderate-to- severe NPDR. |
| • | Presented promising preliminary renal function data from the Company’s Phase 2a TIME-2 clinical trial at the Keystone Symposium on Reducing the Burden of Diabetes Related End-Organ Injury. |
| • | Successfully completed pre-IND meeting with the FDA for AKB-4924, a once-daily, oral HIF-1α stabilizer for treatment of ulcerative colitis, a form of inflammatory bowel disease. |
| • | Completed an AKB-4924 single ascending dose study in human subjects under a CTA in Canada. |
| • | Successfully completed pre-IND meeting with FDA for ARP-1536, a fully-humanized monoclonal antibody that activates Tie2 by binding the extracellular domain of the vascular endothelial protein tyrosine phosphatase (VE-PTP). Because of the long half-life of monoclonal antibodies ARP-1536 has the potential activate Tie2 while being dosed less frequently. |
| • | Appointed Stephen Hoffman, M.D., Ph.D., as Chief Executive Officer and to the Board of Directors. |
| • | Appointed Michael Rogers as Chief Financial Officer. |
Fourth Quarter and Full Year 2017 Financial Highlights
As of December 31, 2017, cash and cash equivalents totaled $20.3 million. Total shares outstanding as of December 31, 2017 were 27.1 million.
For the three months ended December 31, 2017, operating expenses totaled $6.3 million, compared to $3.3 million for the same period in 2016. Net loss attributable to common stockholders for the three months ended December 31, 2017 was $6.2 million, or $0.23 per share, compared to a net loss attributable to common stockholders of $4.6 million, or $4.76 per share, for the same period in 2016.
Operating expenses for the full year ended December 31, 2017, was $21.4 million compared to $16.6 million for the full year ended December 31, 2016. Net loss attributable to common stockholders for the full year ended December 31, 2017 was $22.3 million, or $1.03 per share compared to a net loss attributable to common stockholders of $20.9 million, or $24.52 per share, for the full year ended December 31, 2016.
Research and development expenses for the full year ended December 31, 2017, increased approximately $0.8 million, or 7%, to $12.1 million from $11.4 million in the full year ended December 31, 2016. This increase was the result of increased spending on our lead candidate AKB-9778, currently in Phase 2b development, partially offset by a decrease in spending on our pipeline candidates AKB-4924 and ARP-1536.
General and administrative expenses for the full year ended December 31, 2017, increased approximately $4.0 million, or 75%, to $9.2 million from $5.3 million in the full year ended December 31, 2016. This increase was primarily attributable to personnel and related expenses, as well as professional services, including legal, accounting, insurance and other professional services expenses associated with the reverse merger and related transactions, which we refer to as the Merger, a private placement financing in March 2017, and operating as a public company.
As a result of the Merger during the first quarter of 2017, more fully discussed in our Annual Report on Form 10-K, outstanding preferred shares were exchanged for and outstanding amounts under senior secured convertible notes were converted into common shares of the Company. The Merger was treated
as a recapitalization and reverse acquisition for financial reporting purposes. Following the Merger, we sold to accredited investors $40.2 million of our shares of common stock, generating net proceeds of $37.2 million after deducting placement agent fees and expenses of the offering.
Conference Call and Webcast
Aerpio management will host a live conference call and webcast at 8:30 a.m. Eastern Time today to discuss Aerpio’s financial results and provide a general business update.
The live webcast and a replay may be accessed by visiting Aerpio’s website at http://ir.aerpio.com/. Please connect to the Company’s website at least 15 minutes prior to the live webcast to ensure adequate time for any software download that may be needed to access the webcast. Alternatively, please call (877) 216-7943 (U.S.) or (417) 629-5054 (international) to listen to the live conference call. The conference ID number for the live call is 9278906. Please dial in approximately 10 minutes prior to the call. Telephone replay will be available approximately two hours after the call. To access the replay, please call (855) 859-2056 (U.S.) or (404) 537-3406 (international). The conference ID number for the replay is 9278906.
About AKB-9778
AKB-9778 is being developed as a subcutaneous injection for the treatment of non-proliferative diabetic retinopathy. AKB-9778 binds to and inhibits the intracellular domain of VE-PTP, the most critical negative regulator of Tie2. AKB-9778 has demonstrated the ability to activate the Tie2 receptor irrespective of extracellular levels of its binding ligands, angiopoietin-1 (agonist) or angiopoietin-2 (antagonist) and may be the most efficient pharmacologic approach to activating Tie2.
About Diabetic Retinopathy
Diabetic Retinopathy (DR) is a complication of diabetes caused by damage to blood vessels in the retina. Severity of DR ranges from mild NPDR to more advanced proliferative diabetic retinopathy (PDR), the hallmark of which is the development of new abnormal blood vessels.
About Aerpio Pharmaceuticals
Aerpio Pharmaceuticals, Inc. is a biopharmaceutical company focused on advancing first-in-class treatments for ocular diseases. The Company’s lead compound, AKB-9778, is a small molecule activator of the Tie2 pathway and is in clinical development for the treatment of non-proliferative diabetic retinopathy. For more information please visit www.aerpio.com.
Forward Looking Statements
This press release contains forward-looking statements. Statements in this press release that are not purely historical are forward-looking statements. Such forward-looking statements include, among other things, the development of the Company’s product candidates, including AKB-9778 for non-proliferative diabetic retinopathy or otherwise and other pipeline candidates, and the therapeutic potential of the Company’s product candidates, including AKB-9778. Actual results could differ from those projected in any forward-looking statements due to several risk factors. Such factors include, among others, the ability to raise the additional funding needed to continue to develop AKB-9778 or
other product development plans, the inherent uncertainties associated with the FDA and drug development process, competition in the industry in which the Company operates and overall market conditions. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements, except as required by law. Investors should consult all the information set forth herein and should also refer to the risk factor disclosure set forth in the reports and other documents the Company files with the SEC available at www.sec.gov.
AERPIO PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
| Three months ended | Year ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| Operating expenses: |
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| Research and development |
$ | 3,780 | $ | 1,993 | $ | 12,147 | $ | 11,368 | ||||||||
| General and administrative |
2,509 | 1,312 | 9,241 | 5,266 | ||||||||||||
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| Total operating expenses |
6,289 | 3,305 | 21,388 | 16,634 | ||||||||||||
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| Loss from operations |
(6,289 | ) | (3,305 | ) | (21,388 | ) | (16,634 | ) | ||||||||
| Grant Income |
— | 15 | 94 | 131 | ||||||||||||
| Interest and other expense, net |
54 | (228 | ) | (106 | ) | (481 | ) | |||||||||
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| Net and comprehensive loss |
(6,235 | ) | (3,518 | ) | (21,400 | ) | (16,984 | ) | ||||||||
| Reconciliation of net loss attributable to common stockholders: |
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| Net and comprehensive loss |
(6,235 | ) | (3,518 | ) | (21,400 | ) | (16,984 | ) | ||||||||
| Extinguishment of preferred stock |
— | — | — | 224 | ||||||||||||
| Adjustment of redeemable convertible preferred stock to redemption value |
— | (1,054 | ) | (943 | ) | (4,152 | ) | |||||||||
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| Net loss attributable to common stockholders |
$ | (6,235 | ) | $ | (4,572 | ) | $ | (22,343 | ) | $ | (20,912 | ) | ||||
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| Net loss per share attributable to common stockholders, basic and diluted |
$ | (0.23 | ) | $ | (4.76 | ) | $ | (1.03 | ) | $ | (24.52 | ) | ||||
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| Weighted average number of common shares used in computing net loss per share attributable to common stockholders, basic and diluted |
26,965 | 961 | 21,673 | 853 | ||||||||||||
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AERPIO PHARMACEUTICALS, INC. CONDENSED
CONSOLIDATED BALANCE SHEETS
(In thousands)
| December 31, | December 31, | |||||||
| 2017 | 2016 | |||||||
| Assets |
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| Current assets: |
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| Cash and cash equivalents |
$ | 20,264 | $ | 1,610 | ||||
| Short-term investments |
— | 50 | ||||||
| Prepaid research and development contracts |
313 | 353 | ||||||
| Other current assets |
322 | 213 | ||||||
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| Total current assets |
20,899 | 2,226 | ||||||
| Furniture and equipment, net and deposits |
129 | 171 | ||||||
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| Total assets |
$ | 21,028 | $ | 2,397 | ||||
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| Liabilities and shareholders’ equity |
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| Current liabilities: |
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| Accounts payable and accrued expenses |
$ | 3,592 | $ | 2,471 | ||||
| Convertible notes |
— | 12,387 | ||||||
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| Total current liabilities |
3,592 | 14,858 | ||||||
| Redeemable convertible preferred stock (all classes) |
— | 73,758 | ||||||
| Stockholders’ equity: |
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| Common stock and additional paid-in capital |
125,999 | — | ||||||
| Accumulated deficit |
(108,563 | ) | (86,219 | ) | ||||
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| Total stockholders’ equity (deficit) |
17,436 | (86,219 | ) | |||||
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| Total liabilities and shareholders’ equity |
$ | 21,028 | $ | 2,397 | ||||
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Contacts
Investor & Media:
Aerpio Pharmaceuticals, Inc.
Michael Rogers
Chief Financial Officer
morgers@aerpio.com
or
Burns McClellan, on behalf of Aerpio Pharmaceuticals, Inc.
Media:
Justin Jackson
jjackson@burnsmc.com
or
Investors:
Ami Bavishi
abavishi@burnsmc.com
Source: Aerpio Pharmaceuticals, Inc.