EndeavorRxⓇ prescriptions for children with
ADHD increased 32% in Q1 2023 over Q4 2022
Pivotal study in adults with ADHD showed
significant improvements in attention and clinical outcomes,
exceeding those observed in other age groups; Akili plans to
include data in FDA regulatory submission later this year
Akili, Inc. (Nasdaq: AKLI), a leading digital medicine company,
today reported its financial results for the quarter ended March
31, 2023, and provided an update on business progress.
“We’re seeing steady, increasing uptake of EndeavorRx in the
pediatric market,” said Eddie Martucci, chief executive officer of
Akili. “With the submission of our EndeavorRx adolescent label
expansion data to the FDA and positive results from our pivotal
trial in adults with ADHD, we now have the potential to greatly
expand our current market and reach at least 14 million patients
with ADHD in the U.S. With the ongoing mental health crisis and
medication shortage affecting all ages, we intend to accelerate our
plans to help these millions of patients in need.”
Business Update
- A total of 2,372 prescriptions were written for EndeavorRx in
the first quarter of 2023, representing a 32% increase over the
fourth quarter of 2022 and 255% increase over the first quarter of
2022.
- Prescriptions were written by 920 unique prescribers in the
first quarter of 2023, a 15% increase over the fourth quarter of
2022 and 111% growth over the first quarter of 2022, driven by
increases in both new and repeat prescribers.
- The number of prescription refills written for EndeavorRx
increased 23% in the first quarter of 2023 over the fourth quarter
of 2022 and grew by 447% over the first quarter of 2022.
- On May 3, 2023, Akili announced topline results from
STARS-ADHD-Adult, its pivotal trial of EndeavorRx (AKL-T01) in
adults with ADHD. The study showed significant improvements in
attention function, nearly seven times as large as the changes seen
in the STARS-ADHD study data used in the Company’s successful
filing for its current FDA authorization in children ages 8-12.
Significant improvements were also seen across clinical outcomes,
including quality of life. An estimated eleven million adults in
the United States are living with ADHD, and the Company plans to
use the STARS-ADHD-Adult study data to support the launch of an
adult product as soon as possible.
- On May 8, 2023, Akili submitted data from
STARS-ADHD-Adolescents, the Company’s pivotal trial of AKL-T01 in
13 to 17 year olds with ADHD, to FDA to expand its current
EndeavorRx label to include adolescents. If the label expansion is
approved by FDA, it would approximately double the size of the
Company’s ADHD market opportunity. Full study results from the
adolescent study will be presented at the 2023 American Society of
Clinical Psychopharmacology Annual Meeting on May 31.
First Quarter 2023 Financial Highlights
- Cash position: Cash, cash equivalents, and short-term
investments as of March 31, 2023 were $117.4 million. The Company’s
cash, cash equivalents, and short-term investments as of March 31,
2023 are expected to be sufficient to fund current and planned
operations into the first quarter of 2025.
- Revenues: Total revenues for the first quarter of 2023
were $113 thousand compared to $111 thousand for the fourth quarter
of 2022. The difference between revenue growth and overall
prescription growth was driven by an increase in the deferred
revenue balance at the end of the first quarter of 2023 mainly due
to the timing of prescriptions dispensed in the quarter.
- Total Operating Expenses: GAAP total operating expenses
were $19.1 million for the first quarter of 2023, compared to $22.1
million for the fourth quarter of 2022. Non-GAAP total operating
expenses were $14.0 million for the first quarter of 2023, compared
to $20.0 million for the fourth quarter of 2022. The decrease in
expenses was driven primarily by a decrease in personnel costs
across the organization, lower clinical trials costs, and reduction
in marketing-related spend for EndeavorRx, partially offset by
growth in the sales organization.
- Net income (loss): GAAP net loss was $20.7 million for
the first quarter of 2023, compared to a net loss of $16.8 million
for the fourth quarter of 2022, driven primarily by the fluctuation
in the liability associated with the Company’s earnout shares
during each quarter. Non-GAAP net loss was $13.6 million for
the first quarter of 2023, compared to a net loss of $19.5 million
for the fourth quarter of 2022, driven primarily by lower operating
expenses in the first quarter of 2023.
For additional information, please see the tables below, which
include a reconciliation of the historical non-GAAP financial
measures to GAAP financial measures.
Webcast and Conference Call
Akili will host a conference call and webcast today, Thursday,
May 11, 2023, at 4:30 p.m. ET. A live audio webcast of the
conference call and presentation will be available at
www.akiliinteractive.com under Investor Relations, Events &
Presentations, along with slides that may be referenced during the
call. An archived version of the webcast will be available on the
Company’s website following the event.
To access the call, dial 888-575-5163 (toll-free) or
416-764-8620 (international) and reference “Akili Q1 2023
Earnings.”
Non-GAAP Financial Measures
In addition to financial information prepared and presented in
accordance with generally accepted accounting principles in the
United States (GAAP), this press release includes the following
non-GAAP financial measures: non-GAAP total operating expenses on a
historical basis and non-GAAP net loss on a historical basis. Akili
derives these non-GAAP financial measures by excluding certain
expenses and other items from the respective GAAP financial measure
that is most directly comparable to each non-GAAP financial
measure. Specifically, the non-GAAP total operating expenses
exclude stock-based compensation expense and severance and
termination related costs associated with the workforce reduction
announced in January 2023, and non-GAAP net loss excludes
stock-based compensation expense, severance and termination related
costs associated with the workforce reduction announced in January
2023, and the change in estimated fair value of earn-out
liabilities. Akili’s management believes that these non-GAAP
financial measures are useful to both management and investors in
analyzing its ongoing business and operating performance.
Management does not intend the presentation of these non-GAAP
financial measures to be considered in isolation or as a substitute
for results prepared in accordance with GAAP, but as a complement
to provide greater transparency. In addition, these non-GAAP
financial measures may differ from similarly named measures used by
other companies. A reconciliation of the historical non-GAAP
financial measures to GAAP financial measures is included in the
attached financial tables.
EndeavorRx Indication and Overview
EndeavorRx is the first-and-only FDA-authorized treatment
delivered through a video game experience. EndeavorRx is indicated
to improve attention function as measured by computer-based testing
in children ages 8 to 12 years old with primarily inattentive or
combined-type ADHD, who have a demonstrated attention issue.
Patients who engage with EndeavorRx demonstrate improvements in a
digitally assessed measure Test of Variables of Attention (TOVA®)
of sustained and selective attention and may not display benefits
in typical behavioral symptoms, such as hyperactivity. EndeavorRx
should be considered for use as part of a therapeutic program that
may include clinician-directed therapy, medication, and/or
educational programs, which further address symptoms of the
disorder. EndeavorRx is available by prescription only. It is not
intended to be used as a stand-alone therapeutic and is not a
substitution for a child’s medication. The most common side effect
observed in children in EndeavorRx’s clinical trials was a feeling
of frustration, as the game can be quite challenging at times. No
serious adverse events were associated with its use. EndeavorRx is
recommended to be used for approximately 25 minutes a day, 5 days a
week, over initially at least 4 consecutive weeks, or as
recommended by your child’s health care provider. To learn more
about EndeavorRx, please visit EndeavorRx.com.
About Akili
Akili is pioneering the development of cognitive treatments
through game-changing technologies. Akili’s approach of leveraging
technologies designed to directly target the brain establishes a
new category of medicine – medicine that is validated through
clinical trials like a drug or medical device but experienced like
entertainment. Akili’s platform is powered by proprietary
therapeutic engines designed to target cognitive impairment at its
source in the brain, informed by decades of research and validated
through rigorous clinical programs. Driven by Akili’s belief that
effective medicine can also be fun and engaging, Akili’s products
are delivered through captivating action video game experiences.
For more information, please visit www.akiliinteractive.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, as amended. These forward-looking statements generally are
identified by the words “believe,” “project,” “expect,”
“anticipate,” “estimate,” “intend,” “strategy,” “future,”
“opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,”
“will continue,” “will likely result,” and similar expressions.
Forward-looking statements are predictions, projections and other
statements about future events that are based on current
expectations and assumptions and, as a result, are subject to risks
and uncertainties. These forward-looking statements include,
without limitation, statements in this press release related to:
our expectations regarding the potential expansion of our current
pediatric market; our expectations regarding our potential to reach
at least 14 million patients with ADHD in the U.S., our intent to
accelerate our plans to commercialize products for the adolescent
and adult populations; our plans to use the STARS-ADHD-Adult study
data in a regulatory submission later this year; our plans to use
the STARS-ADHD-Adult study data to support the launch of an adult
product as soon as possible; our expectation that our regulatory
submission to FDA to seek a potential label expansion for
EndeavorRx in ADHD to include adolescents will significantly
increase the size of our ADHD market opportunity; and our
expectation that our existing cash, cash equivalents, and
short-term investments will be sufficient to fund our current and
planned operations into the first quarter of 2025. Any
forward-looking statements in this press release are based on
management’s current expectations and beliefs and are subject to a
number of risks, uncertainties and important factors that may cause
actual events or results to differ materially from those expressed
or implied by any forward-looking statements contained in this
press release, including, without limitation, risks and
uncertainties related to: our ability to successfully further
commercialize EndeavorRx; our ability to successfully create, and
navigate, a new category of medicine and to achieve broad adoption
of digital therapeutics among healthcare providers, caregivers, and
patients; our ability to obtain and maintain adequate coverage and
reimbursement for our digital therapeutics; our ability to continue
to advance our clinical development pipeline; our ability to defend
our intellectual property and satisfy various FDA and other
regulatory requirements in and outside of the United States; the
impact of the COVID-19 pandemic on our business; the risk of
downturns and a changing regulatory landscape in the highly
competitive industry in which we operate; the timing and results
expected from our and our partners’ clinical trials and our
reliance on third parties for certain aspects of our business; our
ability to accurately estimate expenses, capital requirements, and
needs for additional financing; and other risks identified in our
current filings and any subsequent filings made with the Securities
and Exchange Commission (SEC). We caution you not to place undue
reliance on any forward-looking statements, which speak only as of
the date hereof and should not be relied upon as representing our
views as of any subsequent date. We disclaim any obligation to
publicly update or revise any such statements to reflect any change
in expectations or in events, conditions or circumstances on which
any such statements may be based, or that may affect the likelihood
that actual results will differ from those set forth in the
forward-looking statements.
Akili, Inc. Unaudited Condensed Consolidated Balance
Sheets
March 31,
December 31,
March 31,
2023
2022
2022
Assets Current assets: Cash and cash equivalents
$
87,869
$
54,097
$
39,754
Restricted cash
305
305
305
Short-term investments
29,571
82,034
14,973
Accounts receivable
49
41
33
Prepaid expenses and other current assets
3,531
4,565
4,254
Total current assets
121,325
141,042
59,319
Property and equipment, net
844
919
1,118
Operating lease right-of-use asset
2,427
2,596
2,807
Prepaid expenses and other long-term assets
1
-
5
Total assets
$
124,597
$
144,557
$
63,249
Liabilities, redeemable convertible preferred stock and
stockholders’ equity (deficit) Current liabilities: Accounts
payable
$
1,413
$
2,681
$
3,234
Accrued expenses and other current liabilities
2,828
5,616
3,769
Deferred revenue
120
106
123
Deferred rent, short term
-
-
16
Operating lease liability
809
826
605
Note payable, short term
6,250
4,375
-
Total current liabilities
11,420
13,604
7,747
Note payable, long term
8,706
10,442
4,823
Operating lease liability, net of current portion
2,307
2,485
2,995
Corporate bond, net of bond discount
1,888
1,834
1,686
Earn-out liabilities
7,836
5,513
-
Total liabilities
32,157
33,878
17,251
Commitments and contingencies Redeemable convertible preferred
stock
-
-
296,191
Stockholders' equity (deficit) Common stock
8
8
-
Additional paid-in capital
353,429
350,980
-
Accumulated deficit
(260,999
)
(240,288
)
(250,187
)
Accumulated other comprehensive income (loss)
2
(21
)
(6
)
Total stockholders' equity (deficit)
92,440
110,679
(250,193
)
Total liabilities, redeemable convertible preferred stock and
stockholders’ equity (deficit)
$
124,597
$
144,557
$
63,249
Akili, Inc. Unaudited Condensed Consolidated
Statements of Operations
Three Months Ended
March 31,
Three Months Ended
December 31,
2023
2022
2022
Revenues
$
113
$
66
$
111
Cost of revenues
137
96
125
Gross loss
(24
)
(30
)
(14
)
Operating expenses: Research and development
6,084
6,304
7,642
Selling, general and administrative
13,011
15,391
14,451
Total operating expenses
19,095
21,695
22,093
Operating loss
(19,119
)
(21,725
)
(22,107
)
Other income (expense), net
(1,592
)
(167
)
5,311
Income tax expense
-
-
(19
)
Net loss
$
(20,711
)
$
(21,892
)
$
(16,815
)
Akili, Inc. GAAP to Non-GAAP Reconciliation
Three Months Ended
March 31,
Three Months Ended
December 31,
2023
2022
2022
GAAP Total Operating Expenses
$
19,095
$
21,695
$
22,093
Stock-based compensation
(2,759
)
(2,070
)
(2,117
)
Expenses related to workforce reduction
(2,329
)
-
-
Non-GAAP Total Operating Expenses
$
14,007
$
19,625
$
19,976
GAAP Net Loss
$
(20,711
)
$
(21,892
)
$
(16,815
)
Stock-based compensation
2,759
2,070
2,117
Expenses related to workforce reduction
2,329
-
-
Change in estimated fair value for earnout liabilities
2,013
-
(4,842
)
Non-GAAP Net Loss
$
(13,610
)
$
(19,822
)
$
(19,540
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230511005170/en/
Investor Contact: Santosh Shanbhag Chief Financial
Officer InvestorRelations@akiliinteractive.com
Media Contact: Julie DiCarlo SVP, Communications
PR@akiliinteractive.com
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