Cardiome Reports Third Quarter 2015 Financial Results

13 Nov, 2015, 07:00 ET from Cardiome Pharma Corp.

Cardiome to conduct conference call and webcast today,
November 13, 2015 at 8:00 a.m. Eastern (5:00 a.m. Pacific)

NASDAQ: CRME TSX: COM

VANCOUVER, Nov. 13, 2015 /CNW/ - Cardiome Pharma Corp. (NASDAQ: CRME / TSX: COM) today reported financial results for the third quarter and nine months ended September 30, 2015. Amounts, unless specified otherwise, are expressed in U.S. dollars and in accordance with generally accepted accounting principles used in the United States of America (U.S. GAAP).

Quarterly Update

In the last few months, Cardiome has been very active on the business development front.  As a result of the co-promotion agreement with Mitsubishi Tanabe Pharma Europe Ltd., its U.K. sales force has already started actively selling EXEMBOL® (argatroban monohydrate) and the number of sales reps selling AGGRASTAT® in the U.K. has increased from 3 to 9.  This co-promotion agreement follows the in-licensing of ESMOCARD® and Esmocard Lyo® (esmolol hydrochloride) from AOP Orphan Pharma in May, 2015, and the exclusive license of TREVYENT® (treprostinil sodium) with SteadyMed Ltd. in June, 2015. Cardiome continues to focus on acquiring new product licenses within its markets and on expanding the geographic territories in which it commercializes its products.  

The financial results of the quarter on a year-over-year basis were primarily impacted by the timing of distributor sales, anticipated generic competition in certain AGGRASTAT® (tirofiban HCl) markets and foreign exchange translation of Euro denominated revenue.

Summary Results

Cardiome recorded a net loss of $5.8 million (loss per share of $0.31) for the three months ended September 30, 2015, compared to a net loss of $4.4 million (loss per share of $0.26) for the three months ended September 30, 2014. On a year-to-date basis, Cardiome recorded a net loss of $17.1 million (loss per share of $0.97) for the nine months ended September 30, 2015, compared to a net loss of $11.7 million (loss per share of $0.73) for the nine months ended September 30, 2014. Normalizing the comparative periods year over year using a constant currency based on the prior year foreign exchange rates, the net loss for the three and nine months ended September 30, 2015 would have been lower by $0.2 million and $0.8 million, respectively. [1]

Revenue for the three months ended September 30, 2015 was $5.0 million, compared to revenue of $7.8 million for the three months ended September 30, 2014. Revenue for the nine months ended September 30, 2015 and 2014 was $16.2 million and $23.1 million, respectively. The decreases in each period were due primarily to the timing of distributor sales, a decrease in AGGRASTAT® sales due to generic competition and foreign exchange translation on Euro denominated revenue (non-cash impact). Normalizing the comparative periods year over year using a constant currency based on the prior year foreign exchange rates, revenue for the three and nine months ended September 30, 2015 would have been higher by $0.7 million and $1.7 million, respectively. [1]

Gross margin increased to 71.9% and 76.7% for the three and nine months ended September 30, 2015, respectively, from 65.8% and 72.2% in the same periods of 2014. Gross margin increased primarily due to changes in customer mix as well as a decrease in current period supply chain restructuring costs. Gross margin may vary significantly quarter to quarter depending on shipments to specific customers in that quarter.

Selling, general and administration ("SG&A") expense for the three months ended September 30, 2015 increased $0.1 million to $8.0 million, compared to $7.9 million for the three months ended September 30, 2014. Excluding a one-time $0.8 million charge related to the termination of a distribution agreement, SG&A expense for the quarter decreased $0.7 million compared to the same period in 2014.  The decrease was due primarily to the impact of foreign exchange translation. On a year-to-date basis, SG&A expense decreased to $22.7 million for the nine months ended September 30, 2015, from $24.7 million in the same period in 2014. The decrease was due primarily to the current period reversal of certain one-time expenditures accrued in prior quarters, one-time costs incurred in the prior year related to the acquisition of Correvio, and the impact of foreign exchange translation.

Research and development ("R&D") expense for the three and nine months ended September 30, 2015 was $0.02 million and $3.2 million, respectively, compared to R&D expense for the three and nine months ended September 30, 2014 of $0.2 million and $0.5 million, respectively.  The increase in the year to date period was due primarily to the $3.0 million upfront payment to SteadyMed upon the execution of the license and supply agreement for TREVYENT® in the second quarter of 2015.

Interest expense was $0.5 million for both the three months ended September 30, 2015 and the three months ended September 30, 2014. For the nine months ended September 30, 2015, interest expense was $1.8 million, compared to $1.0 million for the nine months ended September 30, 2014.  The increase was primarily due to interest expense incurred on the senior secured term loan facility that Cardiome entered into in July 2014.

Liquidity and Outstanding Share Capital

At September 30, 2015, the company had cash and cash equivalents of $24.7 million. As of November 12, 2015, there were 20,147,337 common shares issued and outstanding, and 1,473,077 common shares issuable upon the exercise of outstanding stock options (of which 903,733 were exercisable) at a weighted average exercise price of CAD $5.87 per share, and 134,608 restricted share units outstanding.

Conference Call Cardiome will hold a teleconference and webcast on November 13, 2015 at 8:00 a.m. Eastern (5:00 a.m. Pacific). To access the conference call, please dial 416-764-8688 or 888-390-0546 and use conference ID 15182479. The webcast can be accessed through Cardiome's website at www.cardiome.com.

Webcast and telephone replays of the conference call will be available approximately two hours after the completion of the call through December 13, 2015. Please dial 416-764-8677 or 888-390-0541 and enter code 182479# to access the replay.

About Cardiome Pharma Corp. Cardiome Pharma Corp. is a specialty pharmaceutical company dedicated to the development and commercialization of cardiovascular therapies that will improve the quality of life and health of patients suffering from heart disease. Cardiome has two marketed, in-hospital, cardiology products, BRINAVESSTM (vernakalant IV), approved in Europe and other territories for the rapid conversion of recent onset atrial fibrillation to sinus rhythm in adults, and AGGRASTAT® (tirofiban HCl) a reversible GP IIb/IIIa inhibitor indicated for use in patients with acute coronary syndrome. Cardiome also commercializes Esmocard® and Esmocard Lyo® (esmolol hydrochloride), a short-acting beta-blocker used to control rapid heart rate in a number of cardiovascular indications, on behalf of their partner AOP Orphan Pharma in select European markets. Cardiome has also licensed TREVYENT®, a development state drug device combination that is under development for Pulmonary Arterial Hypertension, for Europe, the Middle East and for Canadian markets.

Cardiome is traded on the NASDAQ Capital Market (CRME) and the Toronto Stock Exchange (COM). For more information, please visit our web site at www.cardiome.com.

Forward-Looking Statement Disclaimer Certain statements in this news release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 or forward-looking information under applicable Canadian securities legislation that may not be based on historical fact, including without limitation statements containing the words "believe", "may", "plan", "will", "estimate", "continue", "anticipate", "intend", "expect" and similar expressions. Forward- looking statements may involve, but are not limited to, comments with respect to our objectives and priorities for 2015 and beyond, our strategies or future actions, our targets, expectations for our financial condition and the results of, or outlook for, our operations, research and development and product and drug development. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Many such known risks, uncertainties and other factors are taken into account as part of our assumptions underlying these forward-looking statements and include, among others, the following: general economic and business conditions in the United States, Canada, Europe, and the other regions in which we operate; market demand; technological changes that could impact our existing products or our ability to develop and commercialize future products; competition; existing governmental legislation and regulations and changes in, or the failure to comply with, governmental legislation and regulations; availability of financial reimbursement coverage from governmental and third-party payers for products and related treatments; adverse results or unexpected delays in pre-clinical and clinical product development processes; adverse findings related to the safety and/or efficacy of our products or products; decisions, and the timing of decisions, made by health regulatory agencies regarding approval of our technology and products; the requirement for substantial funding to expand commercialization activities; and any other factors that may affect our performance. In addition, our business is subject to certain operating risks that may cause any results expressed or implied by the forward-looking statements in this presentation to differ materially from our actual results. These operating risks include: our ability to attract and retain qualified personnel; our ability to successfully complete pre-clinical and clinical development of our products; changes in our business strategy or development plans; intellectual property matters, including the unenforceability or loss of patent protection resulting from third-party challenges to our patents; market acceptance of our technology and products; our ability to successfully manufacture, market and sell our products; the availability of capital to finance our activities; and any other factors described in detail in our filings with the Securities and Exchange Commission ("SEC") available at www.sec.gov and the Canadian securities regulatory authorities at www.sedar.com. Given these risks, uncertainties and factors, you are cautioned not to place undue reliance on such forward-looking statements and information, which are qualified in their entirety by this cautionary statement. All forward-looking statements and information made herein are based on our current expectations and we undertake no obligation to revise or update such forward-looking statements and information to reflect subsequent events or circumstances, except as required by law.

[1] Normalized net loss and normalized revenue are non-GAAP measures. The Company uses certain Non-GAAP measures to assist in assessing its financial performance. Non-GAAP measures do not have any standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other companies.

CARDIOME PHARMA CORP.

Interim Consolidated Balance Sheets

(Unaudited)

(Expressed in thousands of U.S. dollars, except share amounts)

September 30, 2015

December 31, 2014

Assets

Current assets:

Cash and cash equivalents

$

24,747

$

12,708

Restricted cash

2,231

2,320

Accounts receivable, net of allowance for doubtful accounts of $443 (2014 - $596)

5,428

9,504

Inventories

5,079

5,335

Prepaid expenses and other assets

1,907

1,703

Deferred tax asset

443

439

39,835

32,009

Property and equipment

793

811

Intangible assets

14,705

16,156

Goodwill

318

318

Other assets

502

821

$

56,153

$

50,115

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payable and accrued liabilities

$

10,517

$

13,057

Current portion of long-term debt

4,000

1,714

Current portion of deferred consideration

2,649

3,044

17,166

17,815

Long-term debt

7,000

10,286

Deferred consideration

2,960

4,544

Deferred revenue

1,925

-

Other long-term liabilities

281

331

29,332

32,976

Stockholders' equity:

Common stock

311,983

284,760

Authorized - unlimited number with no par value

Issued and outstanding – 20,129,337 (2014 – 16,591,002)

Additional paid-in capital

34,377

34,229

Deficit

(336,031)

(318,973)

Accumulated other comprehensive income

16,492

17,123

26,821

17,139

$

56,153

$

50,115

 

CARDIOME PHARMA CORP.

Interim Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(Expressed in thousands of U.S. dollars, except share and per share amounts)

Three months ended

Nine months ended

September 30, 2015

September 30, 2014

September 30, 2015

September 30, 2014

Revenue:

Product revenues

$

4,933

$

7,807

$

16,118

$

23,066

Licensing and other fees

25

-

75

-

4,958

7,807

16,193

23,066

Cost of goods sold

1,393

2,673

3,771

6,409

3,565

5,134

12,422

16,657

Expenses:

Selling, general and administration

8,028

7,863

22,736

24,670

Research and development

15

234

3,161

538

Amortization

546

510

1,631

1,610

8,589

8,607

27,528

26,818

Operating loss

(5,024)

(3,473)

(15,106)

(10,161)

Other (income) expense:

Interest expense

542

495

1,776

975

Other (income) expense

38

217

125

100

Foreign exchange (gain) loss

37

68

(298)

118

617

780

1,603

1,193

Net loss before income taxes

(5,641)

(4,253)

(16,709)

(11,354)

Provision for income taxes

169

114

349

387

Net loss

$

(5,810)

$

(4,367)

$

(17,058)

$

(11,741)

Other comprehensive income (loss):

Foreign currency translation adjustments

41

(670)

(631)

(506)

Comprehensive (loss)

$

(5,769)

$

(5,037)

$

(17,689)

$

(12,247)

Loss per common share

Basic and diluted

$

(0.31)

$

(0.26)

$

(0.97)

$

(0.73)

Weighted average common shares outstanding

Basic and diluted

18,774,416

16,520,203

17,542,994

16,130,147

 

CARDIOME PHARMA CORP.

Interim Consolidated Statements of Cash Flows

(Unaudited)

(Expressed in thousands of U.S. dollars)

Three months ended

Nine months ended

September 30, 2015

September 30, 2014

September 30, 2015

September 30, 2014

Operating activities:

Net loss for the period                                           

$

(5,810)

$

(4,367)

$

(17,058)

$

(11,741)

Items not affecting cash:

Amortization

546

510

1,631

1,610

Amortization of deferred financing fees

143

-

408

-

Write-down of inventory

-

607

95

732

Loss on write-down of property and equipment

-

188

-

188

Stock-based compensation

396

370

1,991

766

Unrealized foreign exchange gain

(46)

(241)

(255)

(291)

Changes in operating assets and liabilities:

Restricted cash

254

(7)

(65)

(123)

Accounts receivable

1,644

(1,134)

3,971

(1,830)

Inventories

353

297

161

292

Prepaid expenses and other assets

(238)

1,321

(264)

16

Accounts payable and accrued liabilities

(770)

590

(2,806)

(4,109)

Deferred revenue

475

-

1,425

-

Other long-term liabilities

(8)

-

(50)

-

Net cash used in operating activities

(3,061)

(1,866)

(10,816)

(14,490)

Investing activities:

Purchase of property and equipment

-

(10)

(133)

(27)

Increase in intangible assets

(5)

(26)

(29)

(78)

Net cash used in investing activities

(5)

(36)

(162)

(105)

Financing activities:

Issuance of common stock

23,324

-

28,124

12,406

Share issue costs

(1,473)

-

(1,524)

-

Issuance of common stock upon exercise of stock options

-

-

270

-

Proceeds from issuance of long-term debt

-

12,000

-

12,000

Financing fees

-

(893)

-

(893)

Payment of long-term debt

(1,000)

-

(1,000)

-

Payment of deferred consideration

(669)

(723)

(2,537)

(2,322)

Net cash provided by financing activities

20,182

10,384

23,333

21,191

Effect of foreign exchange rate changes on cash and cash equivalents

15

(253)

(316)

2

Increase in cash and cash equivalents during the period

17,131

8,229

12,039

6,598

Cash and cash equivalents, beginning of period

7,616

9,353

12,708

10,984

Cash and cash equivalents, end of period

$

24,747

$

17,582

$

24,747

$

17,582

Supplemental cash flow information:

Interest paid

$

411

$

441

$

1,450

$

984

Net income taxes paid

291

32

628

212

 

SOURCE Cardiome Pharma Corp.



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http://www.cardiome.com