Durata Therapeutics Inc. (DRTX)
Q4 2012 Earnings Call
March 08, 2013 07:00 AM ET
Allison Wey - Director, IR
Paul Edick - CEO
Corey Fishman - COO and CFO
Mike Dunne - CMO
Adnan Butt - RBC Capital Markets
Steve Byrne - Bank of America
Greg Wade - Wedbush
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Thank you, I would now like to turn the call over to Allison Wey, Vice President of Investor Relations. Please go ahead.
Thank you, Jackie. Good morning and welcome to Durata’s full year 2012 financial results conference call. This morning we issued a Press Release, a copy of which is available on our website. In addition, we are conducting a live webcast of this call, also available on the site.
We are joined this morning by Paul Edick, Chief Executive Officer; Corey Fishman, Chief Operating Officer; Mike Dunne, Chief Medical Officer; and John Shannon, Chief Commercial Officer. Paul will provide opening remarks and share some highlights of the year. Corey will provide details of the financial results. We will then open the call for questions.
Please note that today’s conference call webcast may contain certain forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the "Risk Factors" section of our most recent Annual Report Form 10-K, which is on file with the SEC.
In addition, any forward-looking statements presented on this call represent only views only as of today and should not be relied upon as representing our views as of any subsequent date. We anticipate that subsequent events and developments will cause our views to change; however, while we may elect to update this forward-looking statements at some point in the future, we specifically disclaim any obligation to do so.
I will now turn the call over to Paul Edick.
Thanks, Allison. I’d just like to make a few opening comments. 2012 for us was a very busy and a very productive year at Durata. We think we made a great deal of progress. We raised $72 million in our initial public offering in July. We have had several scientific posters and presentations at scientific meetings and key conferences throughout the year.
We have received the Qualified Infectious Disease Product designation from the FDA which for us is extremely important providing the extra data exclusivity to give us 10 years of data exclusivity from the time of approval.
We also made several strategic hires, John Shannon our Chief Commercial Officer, our head of Investment Relations, Allison Wey. We brought in head of reimbursement to really make sure that we are prepared for reimbursement environment when we hit the market and begun the hiring of our medical science liaisons and scientific communication process.
We have established our permanent offices, technical operations facility in Connecticut and our headquarters in Chicago, and most importantly we completed or brought close to a close in 2012, both of our recent Phase 3 trials; and since both have reported out positive results hitting all primary and secondary endpoints. So we think it's been a very productive and very successful year and I will turn it over to Corey Fishman our Chief Financial Officer, Chief Operating Officer to go through our full year financials.
Thanks Paul. As Paul mentioned in 2012 we completed enrollment of our two large Phase 3 clinical studies with a combined patient total of over 1,300. These studies were clearly a key driver for our 2012 financial results. Our net loss for the 2012 year was $62.5 million versus $33 million in the 2011 year. R&D costs in 2012 were $51.7 million, compared to $30.1 million in 2011.
The increase in spending was due to the increase in clinical trial activities from those recently completed Phase 3 trials. During 2012, we completed enrollment of those trials and are now in the process of closing out the clinical sites and finalizing full trial results. As the cost related to these studies wind down, our 2013 R&D spending is expected to be lower than that in 2012.
Costs relating to operating of the public company and continuing our expansion efforts in preparation of the anticipated commercial launch of dalbavancin were the key drivers of increased G&A spending in 2012. For the year G&A spending was $9.8 million, compared to $4.3 million in 2011.
In 2012, we were also able to fully utilize our net operating losses in the U.S. to offset the gain and the transfer of our worldwide economic rates to dalbavancin to our Dutch subsidiary. We paid $9.8 million in Federal and State Income Taxes in 2012. As a result of this transfer and based on our forecasts we would expect the global effective tax rate to be in the mid to high teens a few years post commercialization and beyond, which would represent a substantial reduction to the statutory rate.
This efficient tax rate will provide additional value to an already attractive Royalty free other than Japan, financial profile of Durata in the years following the launch of dalbavancin. At December 31, 2012, we had cash and cash equivalent in short term investments of $45.3 million, compared to $11.5 million at year end 2011.