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8-K - 8-K - Zyla Life Sciences | a15-17065_18k.htm |
Exhibit 99.1
Egalet Reports Second Quarter 2015 Financial Results and Provides Business Update
Company deployed specialty sales force, began promoting SPRIX® Nasal Spray, prepared to launch OXAYDO in third quarter and completed abuse-deterrent and bioequivalence studies of Guardian Technology product candidate Egalet-001, which will support fourth quarter new drug application (NDA) submission
Webcast and conference call at 8:00 AM EDT
Wayne, Penn. Aug 6, 2015 Egalet Corporation (Nasdaq: EGLT) (Egalet), a fully integrated specialty pharmaceutical company focused on developing, manufacturing and marketing innovative pain treatments, today reported business highlights and financial results for the three months ended June 30, 2015.
Second quarter and recent highlights include:
· Commercial advancements:
· Launched 50-person specialty pharmaceutical sales force;
· Began promoting SPRIX (ketorolac tromethamine) Nasal Spray to target healthcare providers; and
· Conducted pre-launch activities, including setting up distribution system, to support a third quarter launch of OXAYDO (oxycodone HCI, USP) tablets for oral use only CII.
· Pipeline progress:
· Demonstrated bioequivalence at the 60 mg dose of abuse-deterrent, extended-release morphine, Egalet-001, to MS Contin (morphine sulfate controlled-release);
· Met primary endpoint of reduced drug liking of Egalet-001 compared to MS Contin in intranasal human abuse liability study;
· Announced positive top-line results from oral human abuse liability clinical study of Egalet-002, an abuse-deterrent oxycodone;
· Demonstrated in Category 1 abuse-deterrent studies Egalet-002s abuse-deterrent properties compared to reformulated OxyContin (oxycodone);
· Showed in a clinical alcohol interaction study that alcohol dose dumping did not occur with Egalet-002;and
· Announced issuance of U.S. patents covering Egalet product candidates and Guardian Technology.
· Corporate progress:
· Completed $61.0 million offering of 5.50% Convertible Senior Notes due 2020;
· Appointed Nicholas Nicolaides, Ph.D. and John Osborn to board of directors and appointed Timothy Walbert chairman of the board of directors; and
· Closed $86.3 million equity follow-on offering on July 31, 2015.
In the second quarter Egalet transitioned to a fully commercial organization, with the training and launch of our 50-person specialty sales force, promoting of SPRIX® Nasal Spray and preparing for the anticipated third quarter launch of OXAYDO said Bob Radie, Egalets president and chief executive officer. In addition, we completed the clinical and abuse-deterrent studies needed to submit the NDA for Egalet-001 in the fourth quarter of this year, which will represent a significant milestone for the company as this would be our first product fully developed using our proprietary Guardian Technology.
Second Quarter of 2015 Financial Results
· Cash Position: Cash and marketable securities as of June 30, 2015 was $108.4 million compared to $53.9 million as of March 31, 2015. The net increase in cash and marketable securities of $54.5 million in the second quarter 2015, primarily consisted of cash inflows of $56.9 million in net proceeds from the 5.50% Convertible Senior Notes.
· Revenue: Net product sales of SPRIX increased from $607,000 for the three months ended June 30, 2015 from $162,000 for the three months ended March 31, 2015. Related party revenue of $352,000 for the three months ended June 30, 2015 was comprised of the amortization of the deferred revenue related to milestone payments from Shionogi and the performance of certain research and development services performed by Egalet under Egalets collaboration agreement with Shionogi.
· Costs of Sales: Cost of sales was $207,000 for the three months ended June 30, 2015 attributable entirely to sales of SPRIX which commenced in February 2015.
· G&A Expenses: General and administrative expenses increased to $5.8 million for the three months ended June 30, 2015 compared to $4.5 million for the same period in 2014. This increase was primarily attributable to an increase in employee compensation of $1.0 million and professional fees of $1.1 million as we continue to grow Egalets U.S. operations. These increases were offset by a decrease in stock compensation expense of $1.1 million.
· S&M Expenses: Sales and marketing expenses of $3.3 million for the three months ended June 30, 2015 were primarily related to the establishment of the commercial operations in the U.S. and launch activities for SPRIX and pre-launch activities for OXAYDO compared to minimal sales and marketing costs in the same period in 2014.
· R&D Expenses: Research and development expenses were $4.9 million for the three months ended June 30, 2015 compared to $7.4 million for the same period in 2014. This decrease was driven primarily by a decrease in Egalets development costs for Egalet-001 of $1.9 million and a decrease in stock compensation expense of $1.6 million. These decreases were offset by increases in Egalets development costs for Egalet-002 of $602,000 and an increase in employee compensation and professional fees of $457,000.
· Interest Expense: Interest expense of $2.3 million for the three months ended June 30, 2015 was primarily related to the 5.50% Convertible Senior Notes.
· Net Loss: Net loss increased to $17.1 million, or a loss of $1.03 per share, for the three months ended June 30, 2015 from a net loss of $11.7 million, or a loss of $0.73 per share, for the three months ended June 30, 2014.
Upcoming Milestones:
· Launch OXAYDO in the third quarter;
· Present data at PainWeek in September;
· Submit new drug application for Egalet-001 in the fourth quarter; and
· Select Egalet-003 product candidate by year end.
Conference Call Information
Egalets management will host a conference call to discuss the second quarter 2015 financial results:
Date: |
Thursday, Aug 6, 2015 |
Time: |
8:00 a.m. EDT |
Webcast (live and archive): |
http://egalet.investorroom.com/eventsandwebcasts |
Dial-in numbers: |
1-888-346-2615 (domestic) |
|
1-412-902-4253 (international) |
Replay numbers |
1-877-344-7529 (domestic) |
|
1-412-317-0088 (international) |
Conference number: |
10070056 |
About Egalet
Egalet, a fully integrated specialty pharmaceutical company, is focused on developing, manufacturing and commercializing innovative pain treatments. The Company has two approved products: OXAYDO (oxycodone HCI, USP) tablets for oral use only CII and SPRIX® (ketorolac tromethamine) Nasal Spray. In addition, using Egalets proprietary Guardian Technology, the Company is developing a pipeline of clinical-stage, opioid-based product candidates that are specifically designed to deter abuse by physical and chemical manipulation. The lead programs, Egalet-001, an abuse-deterrent, extended-release, oral morphine formulation, and Egalet-002, an abuse-deterrent, extended-release, oral oxycodone formulation, are in late-stage clinical development for the management of pain severe enough to require daily, around-the-clock opioid treatment and for which alternative treatments are inadequate. Egalets Guardian Technology can be applied broadly across different classes of pharmaceutical products and can be used to develop combination products that include multiple active pharmaceutical ingredients with similar or different release profiles. Full additional information on Egalet, please visit www.egalet.com.
Please see full prescribing information for OXAYDO at www.oxaydo.com and full prescribing information for SPRIX at www.sprix.com.
Safe Harbor
Statements included in this press release (including but not limited to upcoming
milestones) that are not historical in nature are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on managements current expectations, and are subject to known and unknown uncertainties and risks. Actual results could differ materially from those discussed due to a number of factors, including, but not limited to: the success of Egalets clinical trials, including the timely recruitment of trial subjects and meeting the timelines therefor; Egalets ability to obtain regulatory approval of Egalets product candidates; ability to maintain the intellectual property position of Egalets products and product candidates; ability to have third parties manufacture Egalets products; the Company's ability to service its debt obligations; competitive factors; the Companys ability to find and hire qualified sales professionals; the receptivity in the marketplace and among physicians to Egalets products; general market conditions; and other risks factors described in Egalets filings with the United States Securities and Exchange Commission. Egalet assumes no obligation to update or revise any forward-looking-statements contained in this press release whether as a result of new information or future events, except as may be required by law.
Investor and Media Contact:
E. Blair Clark-Schoeb
Senior Vice President, Communications
Email: bcs@egalet.com
Tel: 917-432-9275
Tables Follow
Egalet Corporation and Subsidiaries
Consolidated Balance Sheets
(in thousands, except share and per share data)
|
|
December 31, 2014 |
|
June 30, 2015 |
| ||
|
|
|
|
(unaudited) |
| ||
Assets |
|
|
|
|
| ||
Current assets: |
|
|
|
|
| ||
Cash and cash equivalents |
|
$ |
52,738 |
|
$ |
57,666 |
|
Marketable securities, available for sale |
|
|
|
50,764 |
| ||
Related party receivable |
|
679 |
|
537 |
| ||
Inventory |
|
|
|
3,887 |
| ||
Other current assets |
|
|
|
275 |
| ||
Prepaid expenses |
|
698 |
|
378 |
| ||
Other receivables |
|
1,011 |
|
931 |
| ||
Total current assets |
|
55,126 |
|
114,438 |
| ||
Intangible assets, net |
|
184 |
|
11,497 |
| ||
Property and equipment, net |
|
4,417 |
|
4,330 |
| ||
Deposits and other assets |
|
843 |
|
562 |
| ||
Total assets |
|
$ |
60,570 |
|
$ |
130,827 |
|
|
|
|
|
|
| ||
Liabilities and stockholders equity |
|
|
|
|
| ||
Current liabilities: |
|
|
|
|
| ||
Accounts payable |
|
$ |
4,209 |
|
$ |
3,723 |
|
Accrued expenses |
|
2,554 |
|
5,504 |
| ||
Deferred revenue |
|
588 |
|
15,108 |
| ||
Debt - current |
|
|
|
2,616 |
| ||
License fee payable |
|
|
|
2,500 |
| ||
Other current liabilities |
|
78 |
|
118 |
| ||
Total current liabilities |
|
7,429 |
|
29,569 |
| ||
Debt non-current portion |
|
|
|
50,758 |
| ||
Deferred income tax liability |
|
25 |
|
27 |
| ||
Deferred revenue non-current portion |
|
8,855 |
|
16,703 |
| ||
Derivative liability |
|
|
|
1,689 |
| ||
Other liabilities |
|
|
|
120 |
| ||
Total liabilities |
|
16,309 |
|
98,866 |
| ||
|
|
|
|
|
| ||
Stockholders equity: |
|
|
|
|
| ||
Common stock$0.001 par value; 75,000,000 shares authorized at December 31, 2014 and June 30, 2015; 17,283,663 and 17,331,163 shares issued and outstanding at December 31, 2014 and June 30, 2015, respectively |
|
17 |
|
17 |
| ||
Additional paid-in capital |
|
121,028 |
|
141,964 |
| ||
Other comprehensive (loss) income |
|
(171 |
) |
401 |
| ||
Accumulated deficit |
|
(76,613 |
) |
(110,421 |
) | ||
Total stockholders equity |
|
44,261 |
|
31,961 |
| ||
Total liabilities and stockholders equity |
|
$ |
60,570 |
|
$ |
130,827 |
|
Egalet Corporation and Subsidiaries
Consolidated Statements of Operations (Unaudited)
(in thousands, except share and per share data)
|
|
Three Months Ended |
|
Six Months Ended |
| ||||||||
|
|
June 30, |
|
June 30, |
| ||||||||
|
|
2014 |
|
2015 |
|
2014 |
|
2015 |
| ||||
Revenues: |
|
|
|
|
|
|
|
|
| ||||
Net product sales |
|
$ |
|
|
$ |
607 |
|
$ |
|
|
$ |
769 |
|
Related party revenues |
|
490 |
|
352 |
|
746 |
|
973 |
| ||||
Total revenues |
|
490 |
|
959 |
|
746 |
|
1,742 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Cost and Expenses: |
|
|
|
|
|
|
|
|
| ||||
Cost of sales (excluding amortization of product rights) |
|
|
|
207 |
|
|
|
301 |
| ||||
Amortization of product rights |
|
|
|
585 |
|
|
|
963 |
| ||||
General and administrative |
|
4,516 |
|
5,804 |
|
7,778 |
|
10,499 |
| ||||
Sales and marketing |
|
212 |
|
3,284 |
|
218 |
|
4,859 |
| ||||
Research and development |
|
7,361 |
|
4,903 |
|
10,141 |
|
15,303 |
| ||||
Total costs and expenses |
|
12,089 |
|
14,783 |
|
18,137 |
|
31,925 |
| ||||
Loss from operations |
|
(11,599 |
) |
(13,824 |
) |
(17,391 |
) |
(30,183 |
) | ||||
|
|
|
|
|
|
|
|
|
| ||||
Other expense: |
|
|
|
|
|
|
|
|
| ||||
Change in fair value of derivative liability |
|
|
|
773 |
|
|
|
773 |
| ||||
Interest (income) expense |
|
(4 |
) |
2,306 |
|
7,088 |
|
2,766 |
| ||||
Other (gain) loss |
|
|
|
(2 |
) |
|
|
(2 |
) | ||||
Loss on foreign currency exchange |
|
47 |
|
188 |
|
43 |
|
85 |
| ||||
|
|
43 |
|
3,265 |
|
7,131 |
|
3,622 |
| ||||
Loss before provision for income taxes |
|
(11,642 |
) |
(17,089 |
) |
(24,522 |
) |
(33,805 |
) | ||||
Provision for income taxes |
|
16 |
|
(23 |
) |
51 |
|
3 |
| ||||
Net loss |
|
$ |
(11,658 |
) |
$ |
(17,066 |
) |
$ |
(24,573 |
) |
$ |
(33,808 |
) |
|
|
|
|
|
|
|
|
|
| ||||
Per share information: |
|
|
|
|
|
|
|
|
| ||||
Net loss per share of common stock, basic and diluted |
|
$ |
(0.73 |
) |
$ |
(1.03 |
) |
$ |
(1.92 |
) |
$ |
(2.05 |
) |
Weighted-average shares outstanding, basic and diluted |
|
15,887,503 |
|
16,506,798 |
|
12,780,145 |
|
16,481,354 |
|