Arcutis Releases Q1 2024 Financial Results and Business Update

Arcutis Biotherapeutics, Inc., a commercial-stage biopharmaceutical company specializing in innovative treatments for immuno-dermatological conditions, has reported its financial results for the first quarter ending March 31, 2024. The company also provided significant business updates demonstrating a strong first-quarter performance and continued growth in its product portfolio.

ZORYVE®, a key product for Arcutis, achieved first-quarter net product revenues of $21.6 million. This includes $15 million in sales for ZORYVE (roflumilast) cream 0.3% and $6.5 million for ZORYVE (roflumilast) topical foam 0.3%. This marks a sales growth of 675% compared to the first quarter of 2023 and a 59% increase from the fourth quarter of 2023. The company also noted a blended gross-to-net (GTN) improvement, now in the low 60 percent range, indicating better financial efficiency.

ZORYVE cream, known for treating plaque psoriasis, continues to see robust demand. Since its launch, over 208,000 prescriptions have been filled by nearly 12,000 unique prescribers, reflecting high patient and physician satisfaction. This product is covered by the three largest Pharmacy Benefit Managers and several commercial insurers, with plans for Medicare and Medicaid coverage later in 2024.

Arcutis successfully launched ZORYVE foam for seborrheic dermatitis in January, witnessing remarkable uptake with over 46,000 prescriptions filled. This launch addresses a significant unmet need, and the foam is also covered by major Pharmacy Benefit Managers, ensuring broad access.

Looking forward, the FDA has accepted Arcutis' supplemental new drug application (sNDA) for roflumilast cream 0.15% aimed at treating mild to moderate atopic dermatitis in adults and children from age six. The FDA action date for this application is set for July 7, 2024. This sNDA is bolstered by positive outcomes from three Phase 3 studies, a Phase 2 dose-ranging study, and two Phase 1 pharmacokinetic studies.

Other key developments include the ARRECTOR pivotal Phase 3 trial for scalp and body psoriasis, which yielded positive results. Consequently, Arcutis plans to submit an sNDA for this indication by the third quarter of 2024.

Further, Arcutis is developing ARQ-255, a topical suspension of ivarmacitinib, targeting alopecia areata. Enrollment for the first healthy volunteer in a Phase 1b study began in December 2022, with the first subject in the alopecia areata cohort enrolled in the second quarter of 2023.

The company also continues preclinical development of ARQ-234, a fusion protein aimed at treating atopic dermatitis.

Corporate highlights for Arcutis include a public offering in February that raised $172.5 million, alongside a strategic collaboration and licensing agreement with Sato Pharmaceutical Co., Ltd. in Japan. Additionally, David Topper was appointed as Chief Financial Officer in April 2024, succeeding John Smither.

Financially, product revenues for the first quarter of 2024 were $21.6 million, a significant increase from $2.8 million in the first quarter of 2023. This growth is attributed to strong unit demand and improvements in GTN sales deductions. Other revenues for the quarter amounted to $28 million, mainly from collaboration and licensing agreements.

The cost of sales for the quarter was $3.3 million, up from $0.8 million in the previous year. Research and development expenses decreased to $23.1 million from $35.3 million, while selling, general, and administrative expenses rose to $54.8 million from $42.9 million, primarily due to marketing expenses related to the ZORYVE launches. Net loss for the quarter was $35.4 million, a reduction from $80.1 million in the same period last year.

As of March 31, 2024, Arcutis' cash, cash equivalents, restricted cash, and marketable securities totaled $404.5 million, compared to $272.8 million at the end of 2023. Net cash used in operating activities was $31.6 million during the first quarter.