Applied Therapeutics, Inc. (NASDAQ:APLT), a biopharmaceutical company currently trading near its 52-week low of $0.95 and with a market capitalization of $119 million, announced on Thursday the appointment of John H. Johnson as Executive Chairman and Chair of the Board.
The company also reported the resignation of Dr. Shoshana Shendelman from her roles as President, CEO, and Board member. According to InvestingPro data, the stock has declined over 77% in the past six months, reflecting significant challenges facing the company.
Johnson, 66, brings over four decades of experience in the pharmaceutical and biotechnology industry to his new role at Applied Therapeutics. He has held leadership positions at several companies, including Johnson & Johnson and Eli Lilly (NYSE:LLY), and is currently on the boards of Verastem (NASDAQ:VSTM), Inc., Reaction Biology, Xeris Biopharma Holdings, Inc., and Axogen, Inc.
Under the terms of his offer letter, Johnson will receive an annual base salary of $1,010,250 and is eligible for severance benefits upon a qualifying termination of his employment. He has also been granted 1,000,000 restricted stock units and an option to purchase 2,000,000 shares of the company’s common stock as inducement awards.
Les Funtleyder, the company's Chief Financial Officer, has been appointed as interim Chief Executive Officer, while continuing his CFO responsibilities. His compensation has been adjusted to reflect his new duties, including an increase in base salary and target annual bonus, quarterly equity grants, and a lump sum payment upon certain company milestones.
Dr. Shendelman's resignation followed the receipt of a Complete Response Letter (CRL) from the FDA for the New Drug Application (NDA) for govorestat for the treatment of Classic Galactosemia. She has entered into a Separation Agreement with the company, which includes severance payments and additional compensation.
Applied Therapeutics also announced the withdrawal of its Marketing Authorization Application to the European Medicines Agency for govorestat and expects to submit an NDA for the treatment of Sorbitol Dehydrogenase Deficiency after the first quarter of 2025.
These executive changes come as the company reevaluates its response to the FDA's CRL and continues development programs for its drug candidates. With analysts setting price targets ranging from $2 to $13 per share, and the stock showing high price volatility with a beta of 1.72, investors face significant uncertainty.
For comprehensive analysis and detailed valuation metrics, investors can access the full Applied Therapeutics research report on InvestingPro, part of its coverage of 1,400+ US equities.
The information in this article is based on a press release statement.
In other recent news, Applied Therapeutics has undergone significant leadership changes, with John H. Johnson stepping in as Executive Chairman and Les Funtleyder as Interim CEO. The company has also been grappling with regulatory hurdles, including the withdrawal of its Marketing Authorization Application for govorestat in Europe and a delay in its New Drug Application submission to the FDA for the treatment of SORD Deficiency. Analysts have adjusted their earnings expectations in light of these developments, with the company expected to remain unprofitable this year.
Applied Therapeutics also reported a fiscal first quarter revenue of $60.7 million, a 67% increase year-over-year, and an adjusted net loss of $21.6 million or $0.15 per share, which was better than the anticipated loss of $0.27 per share. Adjusted EBITDA stood at $20.0 million, showing a significant increase from the previous year.
In response to these developments, analysts from Baird and RBC (TSX:RY) Capital Markets have downgraded the company's stock, but they acknowledge the potential value in the company's SORD deficiency program.
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