Minerva Neurosciences Reports Net Income Turnaround, Sells Royalty Interest in Seltorexant

Minerva Neurosciences, Inc., a clinical-stage biopharmaceutical company focused on developing treatments for central nervous system diseases, reported significant financial developments in its 10-Q filing for the quarter ending September 30, 2024. The company’s lead product candidate, roluperidone, aims to address negative symptoms in schizophrenia, but it faced regulatory challenges, including a Complete Response Letter (CRL) from the FDA on February 26, 2024, citing clinical deficiencies.

For the three months ended September 30, 2024, Minerva achieved a net income of $22.5 million, a substantial turnaround from a net loss of $7.8 million in the same period of 2023. This improvement was primarily driven by a $26.6 million gain from the adjustment of a liability related to future royalties, which was not present in the prior year. The net income per share for this quarter was $2.97, compared to a loss of $1.03 per share in the previous year.

For the nine months ended September 30, 2024, the company reported a net income of $5.7 million, contrasting sharply with a net loss of $21.0 million for the same period in 2023. Total expenses for the nine months increased to $17.3 million from $15.9 million year-over-year, reflecting higher research and development costs associated with ongoing clinical trials.

As of September 30, 2024, Minerva's cash and cash equivalents stood at $26.5 million, down from $40.9 million at the end of 2023. The total assets decreased to $42.8 million from $56.9 million, while total current liabilities rose to $4.5 million from $3.3 million. The company reported an accumulated deficit of approximately $391.1 million.

In terms of strategic developments, Minerva sold its royalty interest in seltorexant to Royalty Pharma for $60 million upfront, with potential additional milestone payments of up to $95 million. This transaction is expected to provide liquidity as the company continues to seek additional capital for ongoing operations and clinical development.

Minerva also faced challenges regarding its Nasdaq listing, receiving a deficiency letter in April 2024 due to its market value falling below the required minimum. Following a second notice in October 2024, the company requested a hearing to avoid delisting, which could significantly impact its market presence and capital-raising capabilities.

Overall, while Minerva has made strides in financial performance, it continues to navigate regulatory hurdles and market challenges as it advances its product candidates.