OTIC Otonomy Inc.

1.69
+0.04  (+2%)
Previous Close 1.65
Open 1.65
52 Week Low 1.64
52 Week High 6.983
Market Cap $95,684,575
Shares 56,618,092
Float 51,633,210
Enterprise Value $59,420,384
Volume 297,214
Av. Daily Volume 305,629
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Upcoming Catalysts

Drug Stage Catalyst Date
OTO-413
Hearing loss
Phase 1/2
Phase 1/2
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OTO-313
Tinnitus
Phase 2
Phase 2
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Drug Pipeline

Drug Stage Notes
OTIVIDEX
Ménière's disease
Phase 3
Phase 3
Phase 3 trial did not achieve the primary endpoint.
OTIPRIO
Acute otitis externa
Approved
Approved
Approval announced March 2, 2018.
OTO-104 AVERTS-1
Meniere's disease
Phase 3
Phase 3
Phase 3 data released August 30 failed to meet primary and key secondary endpoints.
OTIPRIO (ciprofloxacin otic suspension)
Ear Tube Placement Surgery
Approved
Approved
Approved December 11, 2015

Latest News

    • OTO-313 Phase 2 trial in tinnitus ongoing with results expected in mid-2022
    • OTO-413 Phase 1/2 trial expansion in hearing loss ongoing with results expected in mid-2022
    • OTO-825 preclinical proof-of-concept results presented at ASGCT meeting; Pre-IND meeting complete and IND-enabling activities underway with IND filing anticipated in first half of 2023
    • Financing completed in April 2021 extends cash runway into second half of 2023

    Conference call and webcast today at 4:30 p.m. ET

    SAN DIEGO, Aug. 04, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today reported financial results for the quarter ended June 30, 2021 and provided an update on…

    • OTO-313 Phase 2 trial in tinnitus ongoing with results expected in mid-2022
    • OTO-413 Phase 1/2 trial expansion in hearing loss ongoing with results expected in mid-2022
    • OTO-825 preclinical proof-of-concept results presented at ASGCT meeting; Pre-IND meeting complete and IND-enabling activities underway with IND filing anticipated in first half of 2023
    • Financing completed in April 2021 extends cash runway into second half of 2023

    Conference call and webcast today at 4:30 p.m. ET

    SAN DIEGO, Aug. 04, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today reported financial results for the quarter ended June 30, 2021 and provided an update on its product pipeline and corporate activities. The company will host a conference call and webcast today at 4:30 p.m. ET to discuss recent highlights and financial results.

    "We are off to a good start for enrollment in our OTO-313 Phase 2 trial in tinnitus and OTO-413 Phase 1/2 extension study in hearing loss, with both studies on track for results in mid-2022," said David A. Weber, Ph.D., president and CEO of Otonomy. "We have also made progress in our other hearing loss programs including demonstration that a single administration of our OTO-825 gene therapy rescues hearing loss and cochlear damage in two preclinical proof-of-concept models for GJB2-related congenital hearing loss. Following a productive Pre-IND meeting we have initiated IND-enabling activities for this program that we expect to support an IND filing in the first half of 2023."

    Otonomy Program Updates

    • OTO-313: Phase 2 trial in tinnitus is ongoing with top-line results expected in mid-2022. Otonomy is conducting a Phase 2 trial of OTO-313, based on the design of the successful Phase 1/2 trial, that will enroll approximately 140 patients with persistent, unilateral tinnitus of at least moderate severity. To enrich the study population, this trial is excluding patients with severe hearing loss and has an increased minimum Tinnitus Functional Index (TFI) score required for entry. Otonomy is expanding the unilateral patient population eligible for enrollment by increasing the maximum time from tinnitus onset from six months up to one year. The primary endpoint is the same as reported for the Phase 1/2 trial: a responder analysis based on the proportion of patients who report a clinically meaningful improvement in TFI from baseline at both Month 1 and Month 2 following treatment. The follow-up period has also been extended out to four months to assess durability of the observed treatment effect. 



    • OTO-413: Phase 1/2 expansion study in hearing loss is ongoing with top-line results expected in mid-2022. In June 2021, Otonomy initiated an expansion of the Phase 1/2 trial reported in December in order to support endpoint selection and powering for a more formal Phase 2 trial. The expansion cohort is a randomized, double-blind, placebo-controlled study that will enroll approximately 30 hearing loss patients: 20 will be treated with a single intratympanic injection of OTO-413 and 10 will receive placebo. As in the prior efficacy cohort that demonstrated therapeutic activity for OTO-413 versus placebo, patients will be followed for three months and assessed using the same three clinically-validated speech-in-noise hearing tests: the American English Matrix phrase test, the Words-in-Noise test and the Digits-in-Noise test. The enrollment criteria of the expansion study will continue to target a broad hearing loss patient population.



    • OTO-825: preclinical studies validate therapeutic potential of GJB2 gene therapy for congenital hearing loss with IND filing expected in first half of 2023. OTO-825 is an AAV-based gene therapy to restore hearing in patients with a mutation in the gap junction beta-2 (GJB2) gene, the most common cause of congenital hearing loss, being developed under the company's collaboration with Applied Genetic Technologies Corporation (NASDAQ:AGTC). In May 2021, preclinical proof-of-concept results for OTO-825 were presented at the American Society of Gene & Cell Therapy (ASGCT) Annual Meeting. These results demonstrate that a single administration of OTO-825 rescues hearing loss and cochlear damage in two preclinical models representing a range of hearing loss severity caused by GJB2 deficiency. A Pre-IND meeting has been completed with the U.S. Food and Drug Administration (FDA) that provided guidance regarding nonclinical study design, manufacturing requirements and clinical trial considerations. Based on this feedback, IND-enabling activities are underway with an IND filing anticipated in first half of 2023.



    • OTO-510: preclinical development ongoing for novel and proprietary otoprotection molecule. Cisplatin is a potent chemotherapeutic agent that is widely used to treat a variety of cancers in adults and children, however, it is commonly associated with severe adverse effects including cisplatin-induced hearing loss (CIHL). Otonomy has identified a novel series of molecules with improved otoprotection in preclinical CIHL studies compared to other agents in development. The goal of the OTO-510 program is otoprotection without tumor protection.



    • OTO-6XX: preclinical development ongoing for severe hearing loss program. Otonomy is evaluating therapeutic approaches to repair or regenerate cochlear hair cells that are damaged due to noise, aging or exposure to ototoxic chemicals. This mechanism is expected to be complementary to repair of cochlear synapses, which is addressed by OTO-413.



    • OTIPRIO®: divestiture completed to ALK. As previously disclosed, Otonomy initiated an evaluation of strategic alternatives for OTIPRIO in the first quarter of 2021 that resulted in the sale of product-related assets to ALK-Abelló, Inc. (ALK) in May 2021.

    Anticipated Upcoming Milestones

    • In mid-2022, announce top-line results for OTO-313 Phase 2 clinical trial.



    • In mid-2022, announce top-line results for OTO-413 Phase 1/2 expansion trial.



    • In first half of 2023, file IND for OTO-825.

    Second Quarter Financial Highlights

    • Cash Position: Cash, cash equivalents, and short-term investments totaled $97.9 million as of June 30, 2021, compared to $86.3 million as of December 31, 2020. In April 2021, Otonomy completed an underwritten public offering of 8,298,890 shares of its common stock, which includes the underwriters' full exercise of their option to purchase additional shares, and the Company sold pre-funded warrants to purchase up to 7,111,110 shares of its common stock, for total gross proceeds of approximately $34.7 million, before deducting underwriting discounts and commissions and other offering expenses payable by Otonomy. All of the securities were sold by Otonomy.



    • Long-term Debt: Otonomy obtained a $15.0 million term loan from Oxford Finance LLC in December 2018. In June 2021, the terms of the loan were modified to increase the loan balance to $16.0 million and extend the interest-only repayment period to June 2023, followed by 34 months of amortization.



    • Operating Expenses: GAAP operating expenses were $12.0 million for the second quarter of 2021, compared to $10.6 million for the second quarter of 2020. Non-GAAP operating expenses, which exclude stock-based compensation, were $10.2 million for the second quarter of 2021, compared to $9.1 million for the second quarter of 2020.



    • Research and Development Expenses: GAAP research and development (R&D) expenses were $8.4 million for the second quarter of 2021, compared to $6.9 million for the second quarter of 2020. The year over year increase is related to higher development expenses for OTO-313 and OTO-413 offset by reduced costs for OTIVIDEX.



    • Selling, General and Administrative Expenses: GAAP selling, general and administrative (SG&A) expenses were $3.7 million in the second quarter of both 2021 and 2020.



    • Financial Guidance:



      • 2021 Operating Expenses: Otonomy expects that GAAP operating expenses will be in the range of $46-$48 million, and that non-GAAP operating expenses will be in the range of $38-$40 million.
      • Cash Runway: Otonomy expects that its current cash, cash equivalents, and short-term investments will be sufficient to fund company operations into the second half of 2023.

    Webcast and Conference Call

    Otonomy management will host a webcast and conference call regarding these program updates at 4:30 p.m. ET / 1:30 p.m. PT today. The live call may be accessed by dialing (877) 305-6769 for domestic callers and (678) 562-4239 for international callers with conference ID code number: 8157418. A live webcast of the call will be available online in the investor relations section of Otonomy's website at www.otonomy.com and will be archived there for 30 days.

    Non-GAAP Operating Expenses

    In this press release, Otonomy's operating expenses are provided in accordance with generally accepted accounting principles (GAAP) in the United States and also on a non-GAAP basis. Non-GAAP operating expenses exclude stock-based compensation. Non-GAAP operating expenses are provided as a complement to operating expenses provided in accordance with GAAP because management believes non-GAAP operating expenses help indicate underlying trends in the company's business, are important in comparing current results with prior period results and provide additional information regarding the company's financial position. Management also uses non-GAAP operating expenses to establish budgets and operational goals that are communicated internally and externally and to manage the company's business and to evaluate its performance. The attached financial information includes a reconciliation of the GAAP operating expenses to non-GAAP operating expenses and a reconciliation of GAAP operating expense guidance to non-GAAP operating expense guidance.

    About Otonomy



    Otonomy is a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology. The company pioneered the application of drug delivery technology to the ear in order to develop products that achieve sustained drug exposure from a single local administration. This approach is covered by a broad patent estate and is being utilized to develop a pipeline of products addressing important unmet medical needs with a focus on hearing loss and tinnitus. For additional information please visit www.otonomy.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. Forward-looking statements generally relate to future events or the future financial or operating performance of Otonomy. Forward-looking statements in this press release include, but are not limited to, statements related to the design and conduct of, activity, enrollment plans and patient populations for, and timing of initiation and results for current and planned clinical trials; Otonomy's development plans and timelines for its product candidates and programs; the potential benefits and advantages of Otonomy's product candidates and programs; the potential benefits and opportunities of, and activities under, the collaboration agreement between Otonomy and AGTC, including but not limited to Otonomy's IND-enabling activities and plans to support an IND filing and the license agreement between Otonomy and Kyorin; expectations regarding preclinical programs, including the potential benefits and development activities; expectations regarding Otonomy's ability to advance its pipeline and regarding upcoming catalysts; Otonomy's anticipated upcoming milestones; expectations regarding operating expenses for 2021 and cash runway; and statements by Otonomy's president and CEO. Otonomy's expectations regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties. Actual results may differ materially from those indicated by these forward-looking statements as a result of these risks and uncertainties, including but not limited to: delays and disruption resulting from the COVID-19 pandemic and governmental responses to the pandemic, including current and future impacts to Otonomy's operations, the initiation and progression of, and enrollment in, its planned and current clinical trials, and patient conduct and compliance; Otonomy's ability to accurately forecast financial results; Otonomy's expectation that it will incur significant losses for the foreseeable future; Otonomy's ability to obtain additional financing; Otonomy's dependence on the regulatory success and advancement of its product candidates; the uncertainties inherent in the clinical drug development process, including, without limitation, Otonomy's ability to adequately demonstrate the safety and efficacy of its product candidates, the nonclinical and clinical results for its product candidates, which may not support further development, and challenges related to patient enrollment, conduct and compliance in clinical trials; the integrity of patient-reported outcomes in its current and future clinical trials; the risks of the occurrence of any event, change or other circumstance that could impact the performance under or give rise to the termination of any promotional, collaboration or license agreements, or that could impact Otonomy's ability to repay or comply with the terms of the loan provided by Oxford Finance LLC; side effects or adverse events associated with Otonomy's product candidates; Otonomy's ability to obtain regulatory approval and successfully commercialize its product candidates, if approved; competition in the biopharmaceutical industry; Otonomy's dependence on third parties to conduct nonclinical studies and clinical trials, and for the manufacture of its product candidates; Otonomy's ability to protect its intellectual property in the United States and throughout the world and to ensure compliance with various laws and regulations in countries in which it conducts clinical trials; expectations regarding potential therapy benefits, market size, opportunity and growth; Otonomy's ability to manage operating expenses; implementation of Otonomy's business model and strategic plans for its business, products and technology; general economic and market conditions; and other risks. Information regarding the foregoing and additional risks may be found in the section entitled "Risk Factors" in Otonomy's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (SEC) on August 4, 2021, and Otonomy's future reports to be filed with the SEC. The forward-looking statements in this press release are based on information available to Otonomy as of the date hereof. Otonomy disclaims any obligation to update any forward-looking statements, except as required by law.

    Contacts:

    Media Inquiries

    Spectrum Science

    Chloé-Anne Ramsey

    Vice President

    404.865.3601

    Investor Inquiries

    Westwicke ICR

    Robert H. Uhl

    Managing Director

    858.356.5932





     Otonomy, Inc.
     Condensed Balance Sheet Data
     (in thousands)
         
      As of June 30, As of December 31,
       2021   2020 
      (unaudited)  
     Cash and cash equivalents$85,096  $30,767 
         
     Short-term investments 12,782   55,576 
         
     Right-of-use assets 13,367   14,082 
         
     Total assets 115,419   106,265 
         
     Long-term debt, net 15,913   15,158 
         
     Leases, net of current 13,023   13,847 
         
     Total liabilities 37,766   39,999 
         
     Accumulated deficit (529,346)  (504,624)
         
     Total stockholders' equity 77,653   66,266 
         
         
     



    Otonomy, Inc.
    Condensed Statements of Operations
    (in thousands, except share and per share data)
             
      Three Months Ended Six Months Ended
      June 30, June 30,
       2021   2020   2021   2020 
             
      (unaudited)
    Product sales, net$35  $10  $125  $170 
    Costs and operating expenses:       
     Cost of product sales 140   511   370   725 
     Research and development 8,357   6,935   16,017   14,607 
     Selling, general and administrative 3,669   3,684   7,712   7,520 
    Total costs and operating expenses 12,166   11,130   24,099   22,852 
    Loss from operations (12,131)  (11,120)  (23,974)  (22,682)
             
    Other expense, net (381)  (334)  (748)  (535)
    Net loss$(12,512) $(11,454) $(24,722) $(23,217)
             
    Net loss per share, basic and diluted$(0.19) $(0.37) $(0.42) $(0.75)
             
    Weighted-average shares used to compute      
     net loss per share, basic and diluted 65,627,778   30,873,488   59,010,204   30,843,850 
             
         



    Otonomy, Inc.
    Reconciliation of GAAP to Non-GAAP Operating Expenses
    (in thousands)
             
      Three Months Ended Six Months Ended
      June 30, June 30,
       2021   2020   2021   2020 
      (unaudited)
    GAAP operating expenses       
     Research and development$8,357  $6,935  $16,017  $14,607 
     Selling, general and administrative 3,669   3,684   7,712   7,520 
    Total GAAP operating expenses 12,026   10,619   23,729   22,127 
    Non-GAAP adjustments       
     R&D stock-based compensation expense (817)  (628)  (1,617)  (1,196)
     SG&A stock-based compensation expense (994)  (906)  (2,154)  (1,747)
    Total non-GAAP adjustments (1,811)  (1,534)  (3,771)  (2,943)
    Non-GAAP operating expenses$10,215  $9,085  $19,958  $19,184 
             



    Otonomy, Inc.
    Reconciliation of 2021 GAAP to Non-GAAP Operating Expense Guidance
    (in millions)
       
       
    GAAP operating expenses$46 - $48
    Non-GAAP adjustments 
     Stock-based compensation expense$8
    Non-GAAP operating expenses$38 - $40
       

     



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  1. SAN DIEGO, July 28, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today announced it will report financial results for the second quarter 2021 and provide a corporate update at 4:30 p.m. ET (1:30 p.m. PT) on August 4, 2021.

    The live call may be accessed by dialing (877) 305-6769 for domestic callers and (678) 562-4239 for international callers with conference ID code number: 8157418. A live webcast and archive of the call will be available online from the investor relations section of the company website at www.otonomy.com.

    About Otonomy

    Otonomy is a biopharmaceutical company dedicated to the development of innovative therapeutics…

    SAN DIEGO, July 28, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today announced it will report financial results for the second quarter 2021 and provide a corporate update at 4:30 p.m. ET (1:30 p.m. PT) on August 4, 2021.

    The live call may be accessed by dialing (877) 305-6769 for domestic callers and (678) 562-4239 for international callers with conference ID code number: 8157418. A live webcast and archive of the call will be available online from the investor relations section of the company website at www.otonomy.com.

    About Otonomy



    Otonomy is a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology. The company pioneered the application of drug delivery technology to the ear in order to develop products that achieve sustained drug exposure from a single local administration. This approach is covered by a broad patent estate and is being utilized to develop a pipeline of products addressing important unmet medical needs with a focus on hearing loss and tinnitus. For additional information, please visit www.otonomy.com.

    Contacts:

    Media Inquiries:

    Spectrum Science

    Chloé-Anne Ramsey

    Vice President

    404.865.3601

    Investor Inquiries:

    Westwicke ICR

    Robert H. Uhl

    Managing Director

    858.356.5932



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    • OTO-413 demonstrated a higher proportion of responders than placebo based on multiple speech-in-noise hearing tests in dose escalation efficacy cohort
    • Expansion study will support endpoint selection and powering for Phase 2
    • Top-line results expected in mid-2022

    SAN DIEGO, June 15, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today announced the initiation of an expansion study for the Phase 1/2 clinical trial of OTO-413 in patients with speech-in-noise hearing difficulty. The randomized, double-blind, placebo-controlled study cohort will enroll approximately 30 hearing loss patients of which 20 will be treated with a single intratympanic…

    • OTO-413 demonstrated a higher proportion of responders than placebo based on multiple speech-in-noise hearing tests in dose escalation efficacy cohort

    • Expansion study will support endpoint selection and powering for Phase 2
    • Top-line results expected in mid-2022

    SAN DIEGO, June 15, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today announced the initiation of an expansion study for the Phase 1/2 clinical trial of OTO-413 in patients with speech-in-noise hearing difficulty. The randomized, double-blind, placebo-controlled study cohort will enroll approximately 30 hearing loss patients of which 20 will be treated with a single intratympanic injection of OTO-413 and 10 will receive placebo. Patients will be followed for 3 months and therapeutic activity will be assessed using the same three clinically-validated speech-in-noise hearing tests utilized in the prior cohorts: the American English Matrix phrase test, the Words-in-Noise test and the Digits-in-Noise test. Top-line results are expected in mid-2022.

    "The results presented from the dose escalation efficacy cohort provide initial clinical validation of OTO-413 for the treatment of speech-in-noise hearing difficulty, which is commonly reported by patients with hearing loss due to noise exposure or aging," said David A. Weber, Ph.D., president and CEO of Otonomy. "We are pleased to initiate this expansion study in order to demonstrate the treatment benefit in a larger cohort of hearing loss patients, continue our evaluation of multiple speech-in-noise hearing tests, and provide important information to help us design and power a more formal Phase 2 clinical trial."

    The Phase 1/2 expansion study will be conducted at multiple clinical sites in the U.S. and will enroll approximately 30 patients with self-reported hearing loss confirmed by a speech-in-noise hearing test. The primary assessment of treatment benefit will be based on the proportion of responders in the OTO-413 group versus placebo who demonstrate a clinically-meaningful level of improvement in speech-in-noise hearing from baseline to Months 2 and 3 following treatment.

    About Speech-in-Noise Hearing Difficulty

    Recent research has shown that the loss of synaptic connections between inner ear hair cells and auditory nerve fibers contributes to hearing impairment and may occur earlier than the loss of cochlear hair cells. This cochlear synaptopathy is proposed as an underlying pathology in age-related and noise-induced hearing loss and is believed to contribute to the common difficulty of hearing speech in the presence of background noise. Overall, there are more than 50 million people in the U.S. with acquired hearing loss including a significant proportion experiencing speech-in-noise hearing difficulty, which can lead to social isolation, depression and early cognitive decline.

    About OTO-413

    OTO-413 is a proprietary, sustained-exposure formulation of brain-derived neurotrophic factor (BDNF), which is a naturally occurring protein involved in neuron growth and repair. Nonclinical studies have demonstrated that local administration of BDNF repairs the connections between inner hair cells and auditory nerve fibers in the cochlea that are damaged due to noise trauma or exposure to ototoxic chemicals. Furthermore, Otonomy has demonstrated in preclinical studies that repair of synaptic connections is associated with a restoration of hearing function. An initial dose ascending clinical trial demonstrated that a single intratympanic injection of OTO-413 was well-tolerated, and the proportion of subjects with a clinically-meaningful improvement in speech-in-noise hearing was higher in the OTO-413 treated group than placebo.

    About Otonomy



    Otonomy is a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology. The company pioneered the application of drug delivery technology to the ear in order to develop products that achieve sustained drug exposure from a single local administration. This approach is covered by a broad patent estate and is being utilized to develop a pipeline of products addressing important unmet medical needs with a focus on hearing loss and tinnitus. For additional information please visit www.otonomy.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. Forward-looking statements generally relate to future events or the future financial or operating performance of Otonomy. Forward-looking statements in this press release include, but are not limited to, statements related to plans and expectations regarding OTO-413; and statements by Otonomy's chief executive officer.

    Otonomy's expectations regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties. Actual results may differ materially from those indicated by these forward-looking statements as a result of these risks and uncertainties, including but not limited to: delays and disruption resulting from the COVID-19 pandemic; Otonomy's ability to obtain additional financing; the uncertainties inherent in the clinical drug development process, including, without limitation, Otonomy's ability to adequately demonstrate the safety and efficacy of its product candidates and the nonclinical and clinical results for its product candidates, which may not support further development; the risks of the occurrence of any event, change or other circumstance that could impact the performance under or give rise to the termination of Otonomy's collaboration or license agreements, including its collaboration agreement with AGTC, or that could impact Otonomy's ability to repay or comply with the terms of the loan provided by Oxford Finance LLC; side effects or adverse events associated with Otonomy's product candidates; competition in the biopharmaceutical industry; Otonomy's dependence on third parties to conduct nonclinical studies and clinical trials, and for the manufacture of its product candidates; Otonomy's ability to protect its intellectual property in the United States and throughout the world and to ensure compliance with various laws and regulations in countries in which it conducts clinical trials; expectations regarding potential therapy benefits, market size, opportunity and growth; Otonomy's ability to manage operating expenses; implementation of Otonomy's business model and strategic plans for its business, products and technology; general economic and market conditions; and other risks. Information regarding the foregoing and additional risks may be found in the section entitled "Risk Factors" in Otonomy's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (SEC) on May 11, 2021, and Otonomy's future reports to be filed with the SEC. The forward-looking statements in this press release are based on information available to Otonomy as of the date hereof. Otonomy disclaims any obligation to update any forward-looking statements, except as required by law.

    Contacts:

    Media Inquiries

    Spectrum Science

    Chloé-Anne Ramsey

    Vice President

    404.865.3601

    Investor Inquiries

    Westwicke ICR

    Robert H. Uhl

    Managing Director

    858.356.5932



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  2. SAN DIEGO, May 14, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today announced preclinical proof-of-concept results for OTO-825 presented at the American Society of Gene & Cell Therapy (ASGCT) Annual Meeting. OTO-825 is an AAV-mediated gene therapy targeting the gap junction beta-2 (GJB2) gene developed under the company's collaboration with Applied Genetic Technologies Corporation (NASDAQ:AGTC). These results demonstrate that a single administration of OTO-825 rescues hearing loss and cochlear damage in two preclinical models that represent a range of hearing loss severity caused by GJB2 deficiency.

    "The treatment of GJB2 deficiency…

    SAN DIEGO, May 14, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today announced preclinical proof-of-concept results for OTO-825 presented at the American Society of Gene & Cell Therapy (ASGCT) Annual Meeting. OTO-825 is an AAV-mediated gene therapy targeting the gap junction beta-2 (GJB2) gene developed under the company's collaboration with Applied Genetic Technologies Corporation (NASDAQ:AGTC). These results demonstrate that a single administration of OTO-825 rescues hearing loss and cochlear damage in two preclinical models that represent a range of hearing loss severity caused by GJB2 deficiency.

    "The treatment of GJB2 deficiency is an important unmet medical need since it is the most common genetic mutation causing congenital hearing loss with many patients experiencing significant impairment beginning at birth," said Alan C. Foster, Ph.D., chief scientific officer of Otonomy. "These proof-of-concept results in two independent preclinical models are an important milestone for the program because they validate the therapeutic potential of OTO-825 across a range of hearing loss levels observed in patients and support its advancement into IND enabling activities, which are currently underway."

    The joint oral presentation by Otonomy and AGTC demonstrates the following:

    • OTO-825 induces expression of Connexin26, the protein product of the GJB2 gene, in target cochlear cells including support cells of the organ of Corti and spiral limbus, and fibrocytes of the spiral ligament in both rodents and non-human primates.
    • Connexin26 expressed by OTO-825 forms functional gap junctions, which are required for proper functioning of cochlear hair cells.
    • Two conditional knockout models developed in mice mimic the human setting for GJB2 deficiency by displaying hearing loss and damage to the integrity of cochlear tissue.
    • A single intracochlear administration of OTO-825 rescues expression of Connexin26 in both models.
    • OTO-825 induces significant improvement in hearing across multiple frequencies and normalizes cochlear morphology in both models.

    Mutations in the GJB2 gene account for approximately 30% of congenital hearing loss cases. Patients with GJB2 mutation can have severe-to-profound deafness in both ears that is identified in screening tests routinely performed in newborns.

    About Otonomy

    Otonomy is a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology. The company pioneered the application of drug delivery technology to the ear in order to develop products that achieve sustained drug exposure from a single local administration. This approach is covered by a broad patent estate and is being utilized to develop a pipeline of products addressing important unmet medical needs with a focus on hearing loss and tinnitus. For additional information please visit www.otonomy.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. Forward-looking statements generally relate to future events or the future financial or operating performance of Otonomy. Forward-looking statements in this press release include, but are not limited to, statements related to plans and expectations regarding OTO-825; and statements by Otonomy's chief scientific officer.

    Otonomy's expectations regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties. Actual results may differ materially from those indicated by these forward-looking statements as a result of these risks and uncertainties, including but not limited to: delays and disruption resulting from the COVID-19 pandemic; Otonomy's ability to obtain additional financing; the uncertainties inherent in the clinical drug development process, including, without limitation, Otonomy's ability to adequately demonstrate the safety and efficacy of its product candidates and the nonclinical and clinical results for its product candidates, which may not support further development; the risks of the occurrence of any event, change or other circumstance that could impact the performance under or give rise to the termination of Otonomy's collaboration, co-promotion or license agreements, including its collaboration agreement with AGTC, or that could impact Otonomy's ability to repay or comply with the terms of the loan provided by Oxford Finance LLC; side effects or adverse events associated with Otonomy's product candidates; competition in the biopharmaceutical industry; Otonomy's dependence on third parties to conduct nonclinical studies and clinical trials, and for the manufacture of its product candidates; Otonomy's ability to protect its intellectual property in the United States and throughout the world and to ensure compliance with various laws and regulations in countries in which it conducts clinical trials; expectations regarding potential therapy benefits, market size, opportunity and growth; Otonomy's ability to manage operating expenses; implementation of Otonomy's business model and strategic plans for its business, products and technology; general economic and market conditions; and other risks. Information regarding the foregoing and additional risks may be found in the section entitled "Risk Factors" in Otonomy's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (SEC) on May 11, 2021, and Otonomy's future reports to be filed with the SEC. The forward-looking statements in this press release are based on information available to Otonomy as of the date hereof. Otonomy disclaims any obligation to update any forward-looking statements, except as required by law.

    Contacts:

    Media Inquiries

    Spectrum Science

    Chloé-Anne Ramsey

    Vice President

    404.865.3601

    Investor Inquiries

    Westwicke ICR

    Robert H. Uhl

    Managing Director

    858.356.5932



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    • OTO-313 Phase 2 trial in tinnitus initiated with results expected in mid-2022
    • OTO-413 Phase 1/2 trial expansion in hearing loss expected to start in second quarter of 2021 with results anticipated in mid-2022
    • OTO-825 IND-enabling activities underway with preclinical proof-of-concept data to be presented at ASGCT meeting; update on program to be provided in mid-2021
    • Recent financing extends cash runway into second half of 2023

    Conference call and webcast today at 4:30 p.m. ET

    SAN DIEGO, May 11, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today reported financial results for the quarter ended March 31, 2021 and provided an update on its…

    • OTO-313 Phase 2 trial in tinnitus initiated with results expected in mid-2022

    • OTO-413 Phase 1/2 trial expansion in hearing loss expected to start in second quarter of 2021 with results anticipated in mid-2022
    • OTO-825 IND-enabling activities underway with preclinical proof-of-concept data to be presented at ASGCT meeting; update on program to be provided in mid-2021
    • Recent financing extends cash runway into second half of 2023

    Conference call and webcast today at 4:30 p.m. ET

    SAN DIEGO, May 11, 2021 (GLOBE NEWSWIRE) -- Otonomy, Inc. (NASDAQ:OTIC), a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology, today reported financial results for the quarter ended March 31, 2021 and provided an update on its product pipeline and corporate activities. The company will host a conference call and webcast today at 4:30 p.m. ET to discuss recent highlights and financial results.

    "We are focused on advancing our multiple programs for treating hearing loss and tinnitus as demonstrated by the recent initiation of our Phase 2 trial for OTO-313, ongoing preparation for initiating the expansion of the Phase 1/2 trial for OTO-413 this quarter, and upcoming presentation of preclinical proof-of-concept results for our OTO-825 gene therapy program," said David A. Weber, Ph.D., president and CEO of Otonomy. "Our strengthened balance sheet will fund the Company well beyond our anticipated clinical milestones in mid-2022 and supports the advancement of our multiple preclinical programs including the IND-enabling activities for OTO-825."

    Otonomy Program Updates

    • OTO-313: Phase 2 trial in tinnitus initiated with top-line results expected in mid-2022. Otonomy recently initiated a Phase 2 trial of OTO-313, based on the design of the successful Phase 1/2 trial, that will enroll approximately 140 patients with persistent, unilateral tinnitus of at least moderate severity. To enrich the study population, this trial is excluding patients with severe hearing loss and has an increased minimum Tinnitus Functional Index (TFI) score required for entry. Otonomy is expanding the unilateral patient population eligible for enrollment by increasing the maximum time from tinnitus onset from six months up to one year. The primary endpoint is the same as reported for the Phase 1/2 trial: a responder analysis based on the proportion of patients who report a clinically meaningful improvement in TFI from baseline at both Month 1 and Month 2 following treatment. The follow-up period has also been extended out to four months to assess durability of the observed treatment effect. 



    • OTO-413: Phase 1/2 trial expansion in hearing loss planned to start in second quarter of 2021 with top-line results expected in mid-2022. In December 2020, Otonomy announced positive top-line results from an ascending single dose safety and exploratory efficacy study for OTO-413 in patients with hearing loss. This trial demonstrated that a single intratympanic injection of OTO-413 was well-tolerated across all dose cohorts. Furthermore, the therapeutic activity of OTO-413 versus placebo was demonstrated across multiple clinically-validated speech-in-noise hearing tests at consecutive time points (Days 57 and 85). Beginning in the second quarter of 2021, Otonomy plans to enroll approximately 30 hearing loss patients in an expansion of the Phase 1/2 trial to evaluate a refined study protocol in preparation for Phase 2. This expansion trial will randomize subjects to a single treatment with OTO-413 or placebo and evaluate a reduced number of endpoints focusing on the phrase, word and digit speech-in-noise hearing tests assessed in the initial patient cohorts. Enrollment criteria will continue to target a broad hearing loss population to support design of a Phase 2 trial.



    • OTO-825: IND-enabling activities underway for GJB2 gene therapy for congenital hearing loss with preclinical proof-of-concept data to be presented at ASGCT. OTO-825 is an AAV-based gene therapy to restore hearing in patients with hearing loss caused by a mutation in the gap junction beta-2 (GJB2) gene -- the most common cause of congenital hearing loss. Previously presented preclinical data demonstrate that a gene of interest can be expressed in support cells of the cochlea, which are the relevant target cells for treating GJB2 deficiency, and that consistent gene expression can be observed for at least 12 weeks in non-human primates following a single local administration. Otonomy recently announced that preclinical results demonstrating the successful recovery of hearing and cochlear morphology in two preclinical models of GJB2 deficiency will be presented on May 13, 2021 at the American Society of Gene & Cell Therapy (ASGCT) Annual Meeting. These results supported the selection of OTO-825 for advancement into IND-enabling activities, which are ongoing. An update on this program will be provided in mid-2021.



    • OTO-510: preclinical development ongoing for novel and proprietary otoprotection molecule. Cisplatin is a potent chemotherapeutic agent that is widely used to treat a variety of cancers in adults and children, however, it is commonly associated with severe adverse effects including cisplatin-induced hearing loss (CIHL). Otonomy has identified a novel series of molecules with improved otoprotection in preclinical CIHL studies compared to other agents in development. Preclinical development continues for a small molecule from this class formulated to provide sustained exposure from a single intratympanic injection. The goal of the OTO-510 program is to preserve hearing without protecting the tumor.



    • OTO-6XX: preclinical development ongoing for hair cell repair and regeneration program. In July 2020, Otonomy entered into an exclusive license agreement with KYORIN Pharmaceutical Co., Ltd. (Kyorin) that provides Otonomy with exclusive worldwide rights to develop, manufacture and commercialize a novel compound for the treatment of sensorineural hearing loss. Otonomy is formulating the patent-protected compound utilizing the company's proprietary technology to provide sustained drug exposure in the inner ear following a single local administration. The OTO-6XX program targets hair cell repair and regeneration for the treatment of severe hearing loss.



    • OTIVIDEX®: following completion of analysis, no further support of the program is planned. In February 2021, Otonomy announced the results of a third Phase 3 trial for OTIVIDEX in Ménière's disease. This trial failed to achieve its primary endpoint, which is based on the intent-to-treat population (p value = 0.312). The trial did achieve statistical significance for the per protocol population (p value = 0.031). Based on a comprehensive analysis of the results, Otonomy has decided not to pursue additional development of the product candidate.



    • OTIPRIO®: evaluating strategic alternatives. In June 2020, Otonomy entered a co-promotion agreement that provided ALK-Abelló, Inc. (ALK) with an exclusive right to promote OTIPRIO for acute otitis externa (AOE). This agreement was expanded in October 2020 to include OTIPRIO's other FDA-approved indication, use during ear tube surgery. Following the negative Phase 3 results for OTIVIDEX, Otonomy notified ALK of its intent to evaluate strategic alternatives for the product, which is ongoing.

    Anticipated Upcoming Milestones

    • In the second quarter of 2021, initiate an expansion of the Phase 1/2 clinical trial of OTO-413.



    • In mid-2021, provide update on OTO-825 gene therapy program.



    • In mid-2022, announce top-line results for OTO-313 Phase 2 clinical trial.



    • In mid-2022, announce top-line results for OTO-413 Phase 1/2 expansion trial.

    First Quarter Financial Highlights

    • Cash Position: Cash, cash equivalents, and short-term investments totaled $73.8 million as of March 31, 2021, compared to $86.3 million as of December 31, 2020. In April 2021, Otonomy completed an underwritten public offering of 8,298,890 shares of its common stock, which includes the underwriters' full exercise of their option to purchase additional shares, and the Company sold pre-funded warrants to purchase up to 7,111,110 shares of its common stock, for total gross proceeds of approximately $34.7 million, before deducting underwriting discounts and commissions and other offering expenses payable by Otonomy. All of the securities were sold by Otonomy.



    • Long-term Debt: Otonomy obtained a $15.0 million term loan from Oxford Finance LLC in December 2018. In July 2020, the terms of the loan were amended to extend the interest-only repayment period from 24 months to 36 months, followed by 23 months of amortization.



    • Operating Expenses: GAAP operating expenses were $11.7 million for the first quarter of 2021, compared to $11.5 million for the first quarter of 2020. Non-GAAP operating expenses, which exclude stock-based compensation, were $9.7 million for the first quarter of 2021, compared to $10.1 million for the first quarter of 2020.



    • Research and Development Expenses: GAAP research and development (R&D) expenses were $7.7 million for the first quarter of 2021 and for the first quarter of 2020.



    • Selling, General and Administrative Expenses: GAAP selling, general and administrative (SG&A) expenses in the first quarter of 2021 were $4.0 million, compared to $3.8 million for the first quarter of 2020.



    • Financial Guidance:



      • 2021 Operating Expenses: Otonomy expects that GAAP operating expenses will be in the range of $46-$48 million, and that non-GAAP operating expenses will be in the range of $38-$40 million.
      • Cash Runway: Otonomy expects that its current cash, cash equivalents, and short-term investments will be sufficient to fund company operations into the second half of 2023.

    Webcast and Conference Call

    Otonomy management will host a webcast and conference call regarding these program updates at 4:30 p.m. ET / 1:30 p.m. PT today. The live call may be accessed by dialing (877) 305-6769 for domestic callers and (678) 562-4239 for international callers with conference ID code number: 9497433. A live webcast of the call will be available online in the investor relations section of Otonomy's website at www.otonomy.com and will be archived there for 30 days.

    Non-GAAP Operating Expenses

    In this press release, Otonomy's operating expenses are provided in accordance with generally accepted accounting principles (GAAP) in the United States and also on a non-GAAP basis. Non-GAAP operating expenses exclude stock-based compensation. Non-GAAP operating expenses are provided as a complement to operating expenses provided in accordance with GAAP because management believes non-GAAP operating expenses help indicate underlying trends in the company's business, are important in comparing current results with prior period results and provide additional information regarding the company's financial position. Management also uses non-GAAP operating expenses to establish budgets and operational goals that are communicated internally and externally and to manage the company's business and to evaluate its performance. The attached financial information includes a reconciliation of the GAAP operating expenses to non-GAAP operating expenses and a reconciliation of GAAP operating expense guidance to non-GAAP operating expense guidance.

    About Otonomy



    Otonomy is a biopharmaceutical company dedicated to the development of innovative therapeutics for neurotology. The company pioneered the application of drug delivery technology to the ear in order to develop products that achieve sustained drug exposure from a single local administration. This approach is covered by a broad patent estate and is being utilized to develop a pipeline of products addressing important unmet medical needs with a focus on hearing loss and tinnitus. For additional information please visit www.otonomy.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. Forward-looking statements generally relate to future events or the future financial or operating performance of Otonomy. Forward-looking statements in this press release include, but are not limited to, statements related to the design and conduct of, activity, enrollment plans and patient populations for, and timing of initiation and results for current and planned clinical trials; Otonomy's development plans and timelines for its product candidates and programs; the potential benefits and advantages of Otonomy's product candidates and programs; the potential benefits and opportunities of, and activities under, the collaboration agreement between Otonomy and AGTC, including but not limited to plans to advance into IND enabling studies, the co-promotion agreement between Otonomy and ALK with respect to OTIPRIO, including Otonomy's intention to evaluate strategic alternatives for OTIPRIO, and the license agreement between Otonomy and Kyorin; expectations regarding preclinical programs, including the potential benefits and development activities; expectations regarding Otonomy's ability to advance its pipeline and regarding upcoming catalysts; Otonomy's anticipated upcoming milestones; expectations regarding operating expenses for 2021 and cash runway; and statements by Otonomy's president and CEO. Otonomy's expectations regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties. Actual results may differ materially from those indicated by these forward-looking statements as a result of these risks and uncertainties, including but not limited to: delays and disruption resulting from the COVID-19 pandemic and governmental and site responses to the pandemic, including current and future impacts to Otonomy's operations, the manufacturing of its product candidates, the initiation and progression of, and enrollment in, its planned and current clinical trials, and patient conduct and compliance; Otonomy's ability to accurately forecast financial results; Otonomy's ability to obtain additional financing; Otonomy's dependence on the regulatory success and advancement of its product candidates; the uncertainties inherent in the clinical drug development process, including, without limitation, Otonomy's ability to adequately demonstrate the safety and efficacy of its product candidates, the nonclinical and clinical results for its product candidates, which may not support further development, and challenges related to patient enrollment, conduct and compliance in clinical trials; the integrity of patient-reported outcomes in its current and future clinical trials; the risks of the occurrence of any event, change or other circumstance that could impact the performance under or give rise to the termination of the collaboration agreement between Otonomy and AGTC, the co-promotion agreement between Otonomy and ALK, or the license agreement between Otonomy and Kyorin, or that could impact Otonomy's ability to repay or comply with the terms of the loan provided by Oxford Finance LLC; side effects or adverse events associated with Otonomy's product candidates; Otonomy's ability to successfully commercialize its product candidates, if approved; competition in the biopharmaceutical industry; Otonomy's dependence on third parties to conduct nonclinical studies and clinical trials, and for the manufacture of its product candidates; Otonomy's ability to protect its intellectual property in the United States and throughout the world and to ensure compliance with various laws and regulations in countries in which it conducts clinical trials; expectations regarding potential therapy benefits, market size, opportunity and growth; Otonomy's ability to manage operating expenses; implementation of Otonomy's business model and strategic plans for its business, products and technology; general economic and market conditions; and other risks. Information regarding the foregoing and additional risks may be found in the section entitled "Risk Factors" in Otonomy's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (SEC) on May 11, 2021, and Otonomy's future reports to be filed with the SEC. The forward-looking statements in this press release are based on information available to Otonomy as of the date hereof. Otonomy disclaims any obligation to update any forward-looking statements, except as required by law.

    Contacts:

    Media Inquiries

    Spectrum Science

    Chloé-Anne Ramsey

    Vice President

    404.865.3601

     

    Investor Inquiries

    Westwicke ICR

    Robert H. Uhl

    Managing Director

    858.356.5932

     

     
     
    Otonomy, Inc.
    Condensed Balance Sheet Data
    (in thousands)
        
     As of March 31, As of December 31,
     2021

     2020

     (unaudited)

        
    Cash and cash equivalents$51,016  $30,767 
            
    Short-term investments 22,813   55,576 
            
    Right-of-use assets 13,724   14,082 
            
    Total assets 93,406   106,265 
            
    Long-term debt, current 1,957   —  
            
    Long-term debt, net of current 13,246   15,158 
            
    Leases, net of current 13,440   13,847 
            
    Total liabilities 37,382   39,999 
            
    Accumulated deficit (516,834)  (504,624)
            
    Total stockholders' equity 56,024   66,266 
            



    Otonomy, Inc.
    Condensed Statements of Operations
    (in thousands, except share and per share data)
         
      Three Months Ended
      March 31,
       2021   2020 
         
      (unaudited)
    Product sales, net$90  $160 
    Costs and operating expenses:   
     Cost of product sales 230   214 
     Research and development 7,660   7,672 
     Selling, general and administrative 4,043   3,836 
    Total costs and operating expenses 11,933   11,722 
    Loss from operations (11,843)  (11,562)
         
    Other expense, net (367)  (201)
    Net loss$(12,210) $(11,763)
         
    Net loss per share, basic and diluted$(0.23) $(0.38)
         
    Weighted-average shares used to compute net loss per share,  
     basic and diluted 52,319,101   30,814,211 
         



    Otonomy, Inc.
    Reconciliation of GAAP to Non-GAAP Operating Expenses
    (in thousands)
         
      Three Months Ended
      March 31,
       2021   2020 
             
             
      (unaudited)
    GAAP operating expenses   
     Research and development$7,660  $7,672 
     Selling, general and administrative 4,043   3,836 
    Total GAAP operating expenses 11,703   11,508 
    Non-GAAP adjustments   
     R&D stock-based compensation expense (800)  (568)
     SG&A stock-based compensation expense (1,160)  (841)
    Total non-GAAP adjustments (1,960)  (1,409)
    Non-GAAP operating expenses$9,743  $10,099 
         



    Otonomy, Inc.
    Reconciliation of 2021 GAAP to Non-GAAP Operating Expense Guidance
    (in millions)
       
       
    GAAP operating expenses$46 - $48
    Non-GAAP adjustments 
     Stock-based compensation expense$8
    Non-GAAP operating expenses$38 - $40
       


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