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Prometheus Biosciences Reports Financial Results for Q1 2023, Announces Acquisition by Merck for $10.8 Billion

Strategic Insights

— 2 min read

Prometheus Biosciences, Inc. (Nasdaq: RXDX), a clinical-stage biotechnology company, reported its financial results for the quarter ended March 31, 2023, and announced that it has entered into a definitive agreement to be acquired by Merck for $200.00 per share in cash, totaling approximately $10.8 billion. The transaction is expected to close in the third quarter of 2023.

As of March 31, 2023, Prometheus Biosciences had cash, cash equivalents, and short-term investments of $713.7 million, compared to $695.8 million at the end of Q4 2022. Revenue was $1.1 million for the three months ended March 31, 2023, primarily due to timing of Falk Collaboration development efforts subject to 25% reimbursement. Research and development expenses increased to $36.4 million in Q1 2023, compared to $27.9 million in Q1 2022, mainly due to preparation for global Phase 3 clinical trials for PRA023 and ongoing Phase 2 clinical trial for SSc-ILD indication and Phase 1 clinical trial of PRA052. General and administrative expenses rose to $13.4 million in Q1 2023, from $8.1 million in Q1 2022, primarily due to increased headcount, stock compensation expense, and facility expenses.

Key Takeaways:

  • Prometheus Biosciences, Inc. (Nasdaq: RXDX) reported financial results for Q1 2023, with cash, cash equivalents, and short-term investments of $713.7 million as of March 31, 2023.
  • The company announced a definitive agreement to be acquired by Merck for $10.8 billion, with the transaction expected to close in the third quarter of 2023.
  • Revenue was $1.1 million for Q1 2023, primarily due to timing of Falk Collaboration development efforts subject to 25% reimbursement.
  • Research and development expenses increased to $36.4 million in Q1 2023, mainly due to preparation for global Phase 3 clinical trials for PRA023 and ongoing Phase 2 clinical trial for SSc-ILD indication and Phase 1 clinical trial of PRA052.
  • General and administrative expenses rose to $13.4 million in Q1 2023, primarily due to increased headcount, stock compensation expense, and facility expenses.
  • The company is developing PRA023, a humanized IgG1 monoclonal antibody that has been shown to block the tumor necrosis factor (TNF)-like ligand 1A (TL1A), for the treatment of immune-mediated diseases, including ulcerative colitis (UC), Crohn's Disease (CD), and systemic sclerosis-associated interstitial lung disease (SSc-ILD).

Statistics:

  • Cash, cash equivalents, and short-term investments: $713.7 million as of March 31, 2023.
  • Revenue: $1.1 million for Q1 2023.
  • Research and development expenses: $36.4 million in Q1 2023.
  • General and administrative expenses: $13.4 million in Q1 2023.
  • Weighted average shares outstanding - basic and diluted: 47,461,230 and 47,461,230 respectively.

Sources:

  • Prometheus Biosciences Press Release, May 9, 2023 (GLOBE NEWSWIRE)
  • COMTEX_432214858/2254/2023-05-09T19:58:03 (c) 1995-2023 Cybernet Data Systems, Inc. All Rights Reserved

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