Rigel(RIGL) - 2022 Q2 - Quarterly Report

Financial Performance - TAVALISSE net product sales for the six months ended June 30, 2022, were $34.7 million, an 18% increase compared to the same period in 2021[109] - For the three months ended June 30, 2022, total revenues were $29.8 million, a 13.5% increase from $26.3 million in the same period of 2021[182] - Net product sales of TAVALISSE increased by 9% to $18.6 million for the three months ended June 30, 2022, compared to $17.1 million in the same period of 2021[182] - Contract revenues from collaborations for the three months ended June 30, 2022, were $11.3 million, a significant increase from $3.7 million in the same period of 2021[183] - The company reported a 18% increase in net product sales for the six months ended June 30, 2022, totaling $34.7 million compared to $29.4 million in the same period of 2021[182] Clinical Trials and Development - The Phase 3 clinical trial for fostamatinib in wAIHA enrolled 90 patients, but did not demonstrate statistical significance in the primary efficacy endpoint[112] - A Phase 3 clinical trial for fostamatinib in hospitalized COVID-19 patients completed enrollment with 280 patients, down from the targeted 308, with top-line results expected in Q4 2022[116] - The Fostamatinib Phase 3 clinical program included 150 ITP patients, with a primary efficacy endpoint of stable platelet response by week 24[135] - In the first FIT study, 18% of patients receiving fostamatinib achieved a stable platelet response compared to none in the placebo group[136] - Kissei's Phase 3 trial for fostamatinib in chronic ITP reported positive results, with a stable platelet response significantly higher than placebo[151] Licensing and Agreements - A global exclusive license agreement with Lilly for R552, a RIPK1 inhibitor, includes potential milestone payments of up to $330 million for non-CNS disease products[120] - The company entered a license agreement with Forma for olutasidenib, with an upfront fee of $2 million and potential milestone payments of up to $232.5 million[123] - In Japan, the company entered into a licensing agreement with Kissei, receiving an upfront payment of $33.0 million and potential additional milestone payments of $147.0 million[150] - The company entered into a commercial license agreement with Knight for Latin America, receiving a $2.0 million upfront payment and potential milestone payments of up to $20.0 million[154] Sales and Market Dynamics - The increase in TAVALISSE sales was driven by higher quantities sold and an increase in price per bottle, partially offset by higher revenue reserves due to increased rebates[109] - The competitive landscape for TAVALISSE includes existing therapies and potential generic versions that could significantly impact revenue[145] - The company has entered into exclusive commercialization agreements for fostamatinib with Grifols in Europe and Turkey, expanding its market reach[147] Financial Position and Cash Flow - As of June 30, 2022, the company had approximately $89.2 million in cash, cash equivalents, and short-term investments, down from approximately $125.0 million as of December 31, 2021[215] - Net cash used in operating activities for the six months ended June 30, 2022 was $(38.5) million, compared to net cash provided of $35.3 million for the same period in 2021[216] - The company expects to continue financing future cash needs through public and/or private offerings of equity securities, debt financings, and collaboration arrangements[229] - The company accessed an additional $10.0 million term loan from MidCap in February 2022, bringing the total principal term loan outstanding to $30.0 million as of June 30, 2022[226] Research and Development Expenses - Research and development expenses for the three months ended June 30, 2022, were $14,767,000, a decrease of $2,040,000 from $16,807,000 in 2021[189] - The decrease in research and development expenses was primarily due to a reduction in personnel-related costs of $1.6 million and a decrease in costs related to the ongoing Phase 3 clinical trial on hospitalized COVID-19 patients of $2.5 million[189] - The company expects to continue incurring significant research and development expenses as it advances its Phase 3 clinical studies, including those for wAIHA and COVID-19[192] Legal and Regulatory Matters - A lawsuit was filed against Annora Pharma for patent infringement related to TAVALISSE following their ANDA submission for a generic version[125] - The company is subject to claims related to patent protection and other litigations, requiring careful assessment of potential losses[241] - The FDA granted Fast Track designation to fostamatinib for the treatment of wAIHA in January 2021[158] Operational Challenges - The company has observed reduced patient-doctor interactions due to COVID-19, negatively impacting product sales and collaboration efforts[127] - The company anticipates no significant disruption in its supply chain for commercial products, but the long-term impact of COVID-19 remains uncertain[130] - In 2022, there has been an increase in demand for TAVALISSE as in-person interactions with healthcare providers have risen[129] - The company plans to continue both virtual and live initiatives to meet healthcare provider needs as the pandemic evolves[129]