Acacia Pharma ‘needs $115m to meet breakeven deadline in 2025’
Acacia Pharma reports a “challenging backdrop” to a troubling set of results for the financial year to December 31, 2021 – and 2022 to date seems no better.
The group has experienced “a significant reduction in its available liquidity as the net revenue in 2021 and so far in 2022 continues to lag behind expectations”.
Net revenues for FY21 were $1.2m, with cash as at December 31, 2021 at $21.6m meaning the cash runway, “consistent with what has previously been communicated”, will finance the group only until “mid-2022”. In light of the continued delay in achieving significant revenues, Acacia now expects it would “require a minimum of $115m of additional cash to fund operations to break even (estimated to be by early FY25)”.
Acacia’s key products are Barhemsys and Byfavo.
Barhemsys is the first and only antiemetic approved by the US Food and Drug Administration (FDA) for rescue treatment of postoperative nausea and vomiting (PONV) despite prophylaxis.
Byfavo is indicated for the induction and maintenance of procedural sedation in adults undergoing procedures lasting 30 minutes or less.
Acacia’s scientific progress continued in 2021: the group’s R&D expenditure was $4.07m (2020: $99,000).
In his introductory remarks – an analysis of the alarming predicament the company finds itself in – the chairman stated that “the performance of the group in 2021 against its formulary targets has been positive and has continued to position the business well for growth over the longer term”.
The report notes that investment bank Greenhill & Co, Inc “were appointed to undertake a comprehensive review of strategic alternatives available to maximise value for Acacia’s shareholders”.
It states: “A process was therefore undertaken in which proposals were solicited from multiple parties to acquire the entire issued share capital of Acacia Group and, in response, several proposals of different types were received and considered carefully by the Acacia board.
“Following consideration of the available proposals, and having regard to the advice provided by the board’s advisors and in view of Acacia’s available resources, the directors of Acacia unanimously believe the proposed transaction with Eagle Pharmaceuticals, Inc announced on March 28, 2022 is the best available option for Acacia shareholders to maximise the value of their Acacia shares.”
The offer valued the Acacia Group at €94.7m in a proposed sale to New Jersey-based Eagle Pharmaceuticals.
The directors did not recommend the payment of a dividend for the year to December 31, 2021.
