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--

Aug 06, 2015, 06:00 ET from Egalet Corporation

WAYNE, Pa., Aug. 6, 2015 /PRNewswire/ -- 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-002's 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 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, Egalet's 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 Egalet's 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 Egalet's 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 Egalet's 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 Egalet's 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 Egalet's 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 Egalet's 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. Egalet's 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 management's 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 Egalet's clinical trials, including the timely recruitment of trial subjects and meeting the timelines therefor; Egalet's ability to obtain regulatory approval of Egalet's product candidates; ability to maintain the intellectual property position of Egalet's products and product candidates; ability to have third parties manufacture Egalet's products; the Company's ability to service its debt obligations; competitive factors; the Company's ability to find and hire qualified sales professionals; the receptivity in the marketplace and among physicians to Egalet's products; general market conditions; and other risks factors described in Egalet's 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

 

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SOURCE Egalet Corporation



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