DURECT (DRRX) - 2025 Q1 - Quarterly Results

Business Update and Highlights DURECT focuses on larsucosterol's Phase 3 trial, actively seeking funding, and reported Q1 2025 financial results Management's Statement DURECT prioritizes larsucosterol's Phase 3 trial for severe AH, contingent on funding, with AHFIRM results validating the design - The company's main priority is to start the Phase 3 trial for larsucosterol, but this depends on obtaining adequate funding[2] - DURECT is engaged in active discussions for potential business development and financing transactions to fund the continued development of larsucosterol[2] - The publication of the AHFIRM trial results in NEJM Evidence is considered an important validation of larsucosterol's potential and supports the design of the upcoming Phase 3 trial[2] Key Developments in Q1 2025 Q1 2025 highlights include larsucosterol Phase 3 planning, AHFIRM results, POSIMIR rights regained, and improved financials - The company is planning a registrational Phase 3 trial for larsucosterol in severe AH, with the primary endpoint being 90-day survival. The trial is targeted to begin in 2025, subject to funding, with topline results expected within two years of initiation[5] - On May 6, 2025, DURECT regained all data and know-how for POSIMIR following the termination of its licensing agreement with Innocoll Pharmaceuticals, and is now seeking a new commercialization partner[5] Q1 2025 vs Q1 2024 Financial Performance | Financial Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenues | $0.3 million | $0.5 million | | Net Loss | ($4.2 million) | ($7.6 million) | Cash and Investments | Balance Sheet Item | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash, cash equivalents and investments | $8.4 million | $12.0 million | Clinical Program: Larsucosterol for Alcohol-associated Hepatitis (AH) This section details larsucosterol's mechanism, AHFIRM trial, and the significant unmet medical need in AH Larsucosterol Overview Larsucosterol, an epigenetic modulator, inhibits DNMTs to regulate gene expression for cell survival and inflammation - Larsucosterol is an epigenetic modulator that inhibits DNA methyltransferases (DNMT1, DNMT3a, and 3b), which may lead to improved cell survival, reduced inflammation, and decreased lipotoxicity[8] - The FDA has granted larsucosterol both Fast Track and Breakthrough Therapy designations for the treatment of AH[6][9] AHFIRM Phase 2b Trial The AHFIRM trial was a Phase 2b study of larsucosterol in 307 severe AH patients, assessing 90-day mortality or liver transplantation - The AHFIRM trial was a randomized, double-blind, placebo-controlled Phase 2b study that enrolled 307 patients with severe AH across three arms: Placebo, larsucosterol (30 mg), and larsucosterol (90 mg)[4] - The primary outcome measure was the 90-day incidence of mortality or liver transplantation for patients treated with larsucosterol compared to placebo[4] Market Context: Alcohol-associated Hepatitis (AH) AH is a severe liver disease with high mortality and no FDA-approved therapies, representing a significant unmet medical need - AH is an acute form of alcohol-associated liver disease characterized by severe inflammation and liver cell damage, with no currently FDA-approved therapies[7] - A retrospective analysis of 77 studies showed the overall mortality from AH was 29% at 90 days and 44% at 180 days, indicating a high unmet medical need[7] Financial Statements This section presents DURECT's condensed statements of operations and balance sheets for Q1 2025 and comparative periods Condensed Statements of Operations Q1 2025 saw DURECT's revenues decrease to $0.321 million, while reduced operating expenses led to a lower net loss of $4.2 million Condensed Statements of Operations and Comprehensive Loss (in thousands) | Metric (in thousands, except per share) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenues | $321 | $496 | | Research and development | $1,883 | $4,119 | | Selling, general and administrative | $2,577 | $2,681 | | Loss from operations | ($4,139) | ($6,304) | | Net loss | ($4,232) | ($7,643) | | Net loss per common share | ($0.13) | ($0.25) | Condensed Balance Sheets As of March 31, 2025, DURECT's total assets were $14.4 million, with cash at $8.0 million, and stockholders' equity at $5.4 million Condensed Balance Sheets (in thousands) | Metric (in thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $7,963 | $11,011 | | Total current assets | $9,412 | $13,175 | | Total assets | $14,360 | $18,349 | | Total current liabilities | $7,673 | $7,710 | | Total liabilities | $9,009 | $9,218 | | Stockholders' equity | $5,351 | $9,131 | Corporate Information and Disclosures This section provides an overview of DURECT Corporation and outlines key forward-looking statements and associated risks About DURECT Corporation DURECT is a late-stage biopharmaceutical company developing epigenetic therapies, with larsucosterol as its lead candidate for AH - DURECT is a late-stage biopharmaceutical company that pioneers the development of epigenetic therapies targeting dysregulated DNA methylation[9] - The company's lead drug candidate is larsucosterol, which is being developed for the treatment of acute organ injury, with a primary focus on AH[9] Forward-Looking Statements Forward-looking statements highlight risks including funding for Phase 3, trial outcomes, FDA approval, and the company's going concern status - Key risks include the ability to secure sufficient funding for the Phase 3 trial, the possibility that future trials do not confirm earlier results, and potential FDA delays or requirements for additional trials[10][11] - The company notes risks related to the sufficiency of its cash resources, its ability to meet Nasdaq listing requirements, and its ability to continue as a going concern[11]