First Quarter 2021 Financial Results
The Company reported a net loss of $30.5 million for the first quarter of 2021, as compared to $8.7 million for the prior year period. The increase in net loss for the quarter was due to higher research and development expenses related to the Company’s preparation, initiation and enrollment of the Phase 3 clinical trials within its EMERGENT program, NDA-supporting activities such as manufacturing, and increased employee headcount across the organization.
Research and development expenses were $20.2 million for the first quarter of 2021, as compared to $4.4 million the prior year period. The increase in research and development expenses for the quarter was primarily driven by expenses related to the Company’s preparation, initiation and enrollment of the Phase 3 clinical trials within the EMERGENT program, expenses related to manufacturing in preparation for a potential NDA submission, increased spend on the Company’s discovery programs and increased personnel-related costs due to the increase in employee headcount.
General and administrative expenses were $9.8 million for the first quarter of 2021, as compared to $5.6 million for the prior year period. The increase in general and administrative expenses was primarily due to an increase in employee headcount.
The Company ended the quarter with $571.3 million in cash, cash equivalents and available-for-sale investment securities compared to $322.3 million as of December 31, 2020. The increase was the result of the completion of the Company’s public offering. The Company expects that current cash, cash equivalents and available-for-sale investment securities as of March 31, 2021, will enable the Company to fund its operating expenses and capital expenditure requirements for at least 12 months following the potential NDA submission of KarXT for the treatment of psychosis in adults with schizophrenia.
About Karuna Therapeutics
Karuna Therapeutics is a clinical-stage biopharmaceutical company driven to create and deliver transformative medicines for people living with psychiatric and neurological conditions. At Karuna, we understand there is a need for differentiated and more effective treatments that can help patients navigate the challenges presented by these severe and disabling disorders. Utilizing our extensive knowledge of neuroscience, we are harnessing the untapped potential of the brain in pursuit of novel pathways to develop medicines that make meaningful differences in peoples’ lives. For more information, please visit www.karunatx.com.
Forward Looking Statements
This press release contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding our expectations about the timing of advancing of our planned clinical trials and regulatory filings, our goals to develop and commercialize our product candidates, our identification of additional product candidates, our liquidity and capital resources and other statements identified by words such as “could,” “expects,” “intends,” “may,” “plans,” “potential,” “should,” “will,” “would,” or similar expressions and the negatives of those terms. Forward looking statements are not promises or guarantees of future performance, and are subject to a variety of risks and uncertainties, many of which are beyond our control, and which could cause actual results to differ materially from those contemplated in such forward-looking statements. These factors include risks related to our limited operating history, our ability to obtain necessary funding, our ability to generate positive clinical trial results for our product candidates and other risks inherent in clinical development, the timing and scope of regulatory approvals, changes in laws and regulations to which we are subject, competitive pressures, our ability to identify additional product candidates, risks relating to business interruptions resulting from the coronavirus (COVID-19) pandemic, and other risks set forth under the heading “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2020. Our actual results could differ materially from the results described in or implied by such forward looking statements. Forward-looking statements speak only as of the date hereof, and, except as required by law, we undertake no obligation to update or revise these forward-looking statements.
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