Egalet Reports Third Quarter 2015 Financial Results and Provides Business Update

--Company began commercializing OXAYDO™ and closed $86.3 million equity financing--

--Webcast and conference call at 8:30 AM EST--

Nov 04, 2015, 06:00 ET from Egalet Corporation

WAYNE, Pa., Nov. 4, 2015 /PRNewswire/ -- Egalet Corporation (Nasdaq: EGLT) ("Egalet"), a fully integrated specialty pharmaceutical company focused on developing, manufacturing and marketing innovative treatments for pain and other conditions, today reported business highlights and financial results for the three months ended September 30, 2015.   

Third quarter highlights include:

  • Raised gross proceeds of $86.3 million in an equity financing;
  • Began the commercial promotion of OXAYDO (oxycodone HCI, USP) tablets for oral use only –CII, an opioid agonist indicated for the management of acute and chronic moderate to severe pain where the use of an opioid analgesic is appropriate, and the only immediate-release oxycodone designed to discourage abuse via the route of snorting, to healthcare providers;
  • Grew sales of SPRIX® Nasal Spray, a nonsteroidal anti-inflammatory drug indicated in adult patients for the short-term (up to five days) management of moderate to moderately severe pain that requires analgesia at the opioid level, 114% from second quarter to third quarter;
  • Announced plans to expand commercial reach with an additional 21 sales representatives in place by January 2016;
  • Had a successful pre-NDA meeting with the FDA regarding the new drug application (NDA) for ARYMO™ (formerly Egalet-001), an abuse-deterrent, extended-release morphine, which is expected to be filed in the fourth quarter;
  • Announced plans to expand manufacturing to support the potential commercialization of ARYMO;
  • Shared plans to submit an investigational new drug application in the second half of 2016 for a Guardian™ Technology abuse-deterrent stimulant, Egalet-003; and
  • Presented five scientific abstracts at PainWeek in Las Vegas highlighting the breadth of Egalet's products and product candidates from SPRIX Nasal Spray as a treatment option versus commonly used opioids to the robust abuse-deterrent profiles of ARYMO and Egalet-002, an abuse-deterrent, extended-release oxycodone.

"In the third quarter Egalet expanded the base of SPRIX prescribers, began commercial promotion of its second product, OXAYDO, and raised $86.3 million through an equity financing to put ourselves in a strong cash position—even more important now considering the recent volatility in market conditions," said Bob Radie, Egalet's president and chief executive officer. "In addition, we had a successful pre-NDA meeting with the FDA and are on track to submit an NDA for ARYMO in the fourth quarter—a significant milestone for the company as this will be our first product fully developed using our proprietary Guardian™ Technology."

Third Quarter of 2015 Financial Results

  • Cash Position: Cash and marketable securities as of September 30, 2015 were $169.1 million compared to $108.4 million as of June 30, 2015. The net increase in cash and marketable securities of $60.7 million in the third quarter 2015, primarily consisted of cash inflows of $80.8 million in net proceeds from the follow on public equity offering, reduced by $20.1 million in net cash outflows to fund operations.
  • Revenue: Net product sales of SPRIX increased to $1.3 million for the three months ended September 30, 2015 from $607,000 for the three months ended June 30, 2015. Related party revenue of $390,000 for the three months ended September 30, 2015 was a result of an increase in amortization of deferred revenue related to the $10.0 million Shionogi milestone payment received in the second quarter of 2015, partially offset by a decrease in research and development services performed under Egalet's collaboration agreement with Shionogi.
  • Costs of Sales: Cost of sales was $349,000 for the three months ended September 30, 2015 attributable entirely to sales of SPRIX which commenced in February 2015.
  • G&A Expenses: General and administrative expenses increased to $5.5 million for the three months ended September 30, 2015 compared to $3.8 million for the same period in 2014. This increase was primarily attributable to an increase in employee salary and benefits of $1.0 million and $940,000 in professional and administrative fees as we continue to expand Egalet's U.S. operations. These increases were offset by a decrease in stock compensation expense of $166,000.
  • S&M Expenses: Sales and marketing expenses increased to $6.3 million from $367,000 for the three months ended September 30, 2015 related to the establishment of the commercial operations in the U.S. and launch activities for SPRIX and OXAYDO compared to minimal sales and marketing costs in the same period in 2014. 
  • R&D Expenses: Research and development expenses decreased to $4.6 million for the three months ended September 30, 2015 from $6.3 million for the same period in 2014. This decrease was driven primarily by a decrease in Egalet's development costs for ARYMO of $2.8 million and a decrease in stock compensation expense of $607,000. These decreases were partially offset by an increase in our development costs of Egalet-002 of $2.0 million.
  • Interest Expense: Interest expense of $2.4 million for the three months ended September 30, 2015 was primarily related to the 5.50% convertible senior notes.
  • Net Loss: Net loss increased to $17.4 million, or a loss of $0.81 per share, for the three months ended September 30, 2015 from a net loss of $10.2 million, or a loss of $0.63 per share, for the three months ended September 30, 2014.

Conference Call Information
Egalet's management will host a conference call to discuss the third quarter 2015 financial results:

Date:

Wednesday, November 4, 2015

Time: 

8:30 a.m. EST

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: 

10075117

About Egalet
Egalet, a fully integrated specialty pharmaceutical company, is focused on developing, manufacturing and commercializing innovative treatments for pain and other conditions. 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, ARYMO, formerly known as 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 egalet.com. For full prescribing information on SPRIX, please visit sprix.com and for Oxaydo please visit oxaydo.com. For full prescribing information on SPRIX, including the black box warning, please visit sprix.com. For full prescribing information on OXAYDO, please visit oxaydo.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


 

September 30,

2015






(unaudited)

Assets







Current assets:







Cash and cash equivalents


$

52,738


$

77,158

Marketable securities, available for sale





91,911

Related party receivable



679



102

Inventory





3,552

Other current assets





577

Prepaid expenses



698



1,374

Other receivables



1,011



922

Total current assets



55,126



175,596

Intangible assets, net



184



10,993

Property and equipment, net



4,417



4,106

Deposits and other assets



843



3,263

Total assets


$

60,570


$

193,958








Liabilities and stockholders' equity







Current liabilities:







Accounts payable


$

4,209


$

3,469

Accrued expenses



2,554



5,103

Deferred revenue



588



13,718

Debt - current





3,970

License fee payable





2,500

Other current liabilities



78



68

Total current liabilities



7,429



28,828

Debt -- non-current portion, net





50,647

Deferred income tax liability



25



27

Deferred revenue -- non-current portion



8,855



16,508

Derivative liability





1,097

Other liabilities





185

Total liabilities



16,309



97,292








Stockholders' equity:







Common stock--$0.001 par value; 75,000,000 shares authorized at
  December 31, 2014 and September 30, 2015; 17,283,663 and
  25,059,474 shares issued and outstanding at December 31, 2014
  and September 30, 2015, respectively



17



25

Additional paid-in capital



121,028



224,034

Accumulated other comprehensive (loss) income



(171)



389

Accumulated deficit



(76,613)



(127,782)

Total stockholders' equity



44,261



96,666

Total liabilities and stockholders' equity


$

60,570


$

193,958








       

Egalet Corporation and Subsidiaries


Consolidated Statements of Operations (Unaudited)

(in thousands, except share and per share data)




Three Months Ended


Nine Months Ended




September 30,


September 30,




2014


2015


2014


2015


Revenues:














Net product sales


$


$

1,296


$


$

2,065


Related party revenues



346



390



1,094



1,361


Total revenues



346



1,686



1,094



3,426












Cost and Expenses:










Cost of sales (excluding amortization of
  product rights)



349



650


Amortization of product rights



505



1,468


General and administrative


3,827


5,515


11,708


16,014


Sales and marketing


367


6,283


482


11,142


Research and development


6,346


4,602


16,487


19,905


Total costs and expenses


10,540


17,254


28,677


49,179


Loss from operations


(10,194)


(15,568)


(27,583)


(45,753)












Other (income) expense:










Change in fair value of derivative liability



(592)



181


Interest (income) expense


(5)


2,380


7,084


5,146


Other (gain) loss





(2)


(Gain) loss on foreign currency exchange


(46)


2


(3)


87




(51)


1,790


7,081


5,412


Loss before provision for income taxes


(10,143)


(17,358)


(34,664)


(51,165)


Provision for income taxes


35


1


84


4


Net loss


$

(10,178)


$

(17,359)


$

(34,748)


$

(51,169)












Per share information:










Net loss per share of common stock, basic
  and diluted


$

(0.63)


$

(0.81)


$

(2.49)


$

(2.81)


Weighted-average shares outstanding,
  basic and diluted


16,206,530


21,530,153


13,934,824


18,182,781


    

Logo - http://photos.prnewswire.com/prnh/20140219/NY67493LOGO

SOURCE Egalet Corporation



RELATED LINKS

http://www.egalet.com