MediWound Ltd. (Nasdaq:MDWD), a fully-integrated biopharmaceutical
company bringing innovative therapies to address unmet needs in
severe burn and wound management, reports financial results for the
three and nine months ended September 30, 2016.
Highlights of the third quarter of 2016
include:
- Third quarter 2016 Revenue of $518,000 compared with $102,000
in the prior year’s third quarter, underscoring the Company’s
progress growing NexoBrid® sales;
- U.S. Phase 3 clinical trial protocol for NexoBrid to debride
severe burns amended to increase the Total Body Surface Area (TBSA)
of burn patients eligible for the study from 15% to 30%;
and
- Multiple oral and poster presentations highlighting EscharEx®
and NexoBrid's innovative, effective and fast enzymatic debriding
of severe burns and chronic wounds presented at the 18th Congress
of the International Society for Burn Injuries
(ISBI).
Management Commentary
“Our third quarter financial performance
demonstrates progress in converting NexoBrid use into
revenues. The presentation of positive data at major burn
meetings such as the ISBI continues to enhance interest as we work
to transition NexoBrid to the standard-of-care for the debridement
of severe burns,” stated Gal Cohen, President and Chief Executive
Officer of MediWound. “Following discussions with U.S. Food
and Drug Administration (FDA), we amended the protocol for our U.S.
Phase 3 study of NexoBrid, to increase the TBSA of patients
eligible for inclusion from 15% to 30%. This amendment will
allow for the inclusion of patients with larger TBSA and should
support a broader marketing label. With the expansion of TBSA, we
are required to collect additional data on this cohort of patients,
which will require implementation of certain study
adjustments. As a result, we now expect to have the acute
top-line data in the first half of 2018.
“Earlier this year we were delighted to report
compelling clinical efficacy and safety data from our Phase 2 study
of EscharEx for the debridement of chronic and hard-to-heal wounds,
particularly in diabetic foot ulcers and venous leg ulcers. We plan
to submit our data package to the FDA by year-end, and expect to
meet with the Agency in early 2017 to discuss a pivotal program for
EscharEx in the U.S. We are excited to be advancing our clinical
plan forward with the goal of making EscharEx available for the
treatment of these indications.
“We continued to make progress across all key
areas of our business, including growing revenues and advancing our
clinical studies, all while maintaining financial discipline. We
look forward to advancing our programs during the balance of 2016
and expect to build upon these achievements throughout 2017,” added
Mr. Cohen.
Third Quarter Financial
Results
Revenues for the third quarter of 2016
were $518,000 compared with $102,000 for the
third quarter of 2015.
Net research and development expenses for the
third quarter of 2016 of $2.4 million compare with $0.8
million for the third quarter of 2015. The increase was
primarily due to an incremental $1.2 million related to NexoBrid
clinical trials and $0.8 million related to EscharEx and MWPC003
development, partially offset by $0.5 million of additional
participation by the U.S. Biomedical Advanced Research and
Development Authority (BARDA) and the Israeli Office of the
Chief Scientist.
Sales, marketing and G&A expenses were $2.6
million for the third quarter of 2016 compared with $2.8 million
for the third quarter of 2015.
For the third quarter of 2016, the Company
posted a net loss of $5.7 million, or $0.26 per
share, compared with a net loss of $3.8 million,
or $0.17 per share, for the third quarter of 2015. The
increase was primarily due to higher net research and development
expenses of $1.5 million.
Adjusted EBITDA, as defined below, for the third
quarter of 2016 was a loss of $4.2 million, compared with a
loss of $3.6 million for the third quarter of 2015.
Nine Months Financial
Results
Revenues for the first nine months of 2016
were $1.1 million compared with $0.3
million for the same period of 2015.
Operating expenses for the first nine months of
2016 were $15.5 million, in line with the Company's budget, and
compare with $12.9 million for the same period of 2015. The
increase was primarily due to higher net research and development
expenses of $2.3 million and a $0.3 million increase in
non-cash share-based compensation expense. The increase in net
research and development expenses was primarily due to an increase
of $3.7 million related to NexoBrid clinical trials, as well as
$2.4 million related to EscharEx and MWPC003 development, which was
partially offset by $3.6 million of additional participation from
BARDA.
For the nine months ended September 30, 2016,
the Company posted a net loss of $17.0 million,
or $0.78 per share, compared with a net loss
of $14.3 million, or $0.66 per share, for the same
period in 2015.
Adjusted EBITDA, as defined below, for the first
nine months of 2016 was a loss of $12.9 million, compared with
a loss of $12.1 million for the first nine months of
2015.
Balance Sheet Highlights
As of September 30, 2016 the Company
had cash and short-term deposits of $34.0 million and
working capital of $32.6 million. The Company remained
on budget and utilized $12.2 million in cash to fund
operating activities during the first nine months of 2016.
During the remainder of 2016 the Company will
continue to invest primarily in its sales and marketing activities
in Europe to advance the adoption of NexoBrid and in
research and development efforts for NexoBrid, which is supported
by BARDA funding, as well as to advance the development of EscharEx
for chronic wounds and other pipeline product candidates.
The Company expects cash use for operating
activities for the year ended December 31, 2016 to be in the range
of $17 million to $20 million.
Conference Call
MediWound management will host a conference
call for investors today, November 14, 2016 beginning
at 8:30 a.m. Eastern time to discuss these results and
answer questions. Shareholders and other interested parties
may participate in the call by dialing (877) 602-7189 (domestic) or
(678) 894-3057 (international) and entering passcode 90184006. The
call also will be broadcast live on the Internet on the
Company's website at www.mediwound.com.
A replay of the call will be accessible two
hours after its completion through November 21, 2016 by
dialing (855) 859-2056 (domestic) or (404) 537-3406 (international)
and entering passcode 90184006. The call will also be archived on
the Company website for 90 days at www.mediwound.com.
Non-IFRS Financial Measures
To supplement consolidated financial statements
prepared and presented in accordance with IFRS, the Company has
provided a supplementary non-IFRS measure to consider in evaluating
its performance. Management uses adjusted EBITDA, which it defines
as earnings before interest, taxes, depreciation and amortization,
impairment, one-time expenses, restructuring and stock-based
compensation expenses.
Although adjusted EBITDA is not a measure of
performance or liquidity calculated in accordance with IFRS, we
believe the non-IFRS financial measures we present provide
meaningful supplemental information regarding our operating results
primarily because they exclude certain non-cash charges or items
that we do not believe are reflective of our ongoing operating
results when budgeting, planning and forecasting and
determining compensation, and when assessing the performance
of our business with our senior management.
However, investors should not consider these
measures in isolation or as substitutes for operating income, cash
flows from operating activities or any other measure for
determining the Company's operating performance or liquidity that
is calculated in accordance with IFRS. In addition, because
adjusted EBITDA is not calculated in accordance with IFRS, it may
not necessarily be comparable to similarly titled measures employed
by other companies. The non-IFRS measures included in this press
release have been reconciled to the IFRS results in the tables
below.
About MediWound Ltd.
MediWound is a fully-integrated
biopharmaceutical company focused on developing, manufacturing and
commercializing novel therapeutics based on its patented
proteolytic enzyme technology to address unmet needs in the fields
of severe burns, chronic and other hard-to-heal wounds. MediWound’s
first innovative biopharmaceutical product, NexoBrid®, received
marketing authorization from the European Medicines Agency as well
as the Israeli and Argentinian Ministries of Health, for removal of
dead or damaged tissue, known as eschar, in adults with deep
partial and full-thickness thermal burns and was launched in Europe
Israel and Argentina. NexoBrid represents a new paradigm in
burn care management, and clinical trials have demonstrated, with
statistical significance, its ability to non-surgically and rapidly
remove the eschar earlier and without harming viable tissue.
MediWound's second innovative product,
EscharEx®, is a topical biological drug being developed for
debridement of chronic and other hard-to-heal wounds and is
complementary to the large number of existing wound healing
products, which require a clean wound bed in order to heal the
wound. EscharEx contains the same proteolytic enzyme technology as
NexoBrid, and benefits from the wealth of existing development data
on NexoBrid. In two Phase 2 studies, EscharEx demonstrated
safety and efficacy in the debridement of chronic and other
hard-to-heal wounds, within a few daily applications.
For more information, please visit
www.mediwound.com.
Cautionary Note Regarding
Forward-Looking Statements
This release includes forward-looking statements
within the meaning of Section 27A of the U.S. Securities Act of
1933, as amended, Section 21E of the US Securities Exchange Act of
1934, as amended, and the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are statements that are not historical facts, such as
statements regarding assumptions and results related to the
regulatory authorizations and launch dates. In some cases, you
can identify forward-looking statements by terminology such as
“believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,”
“should,” “plan,” “expect,” “predict,” “potential,” or the negative
of these terms or other similar expressions. Forward-looking
statements are based on MediWound’s current knowledge and its
present beliefs and expectations regarding possible future events
and are subject to risks, uncertainties and assumptions. Actual
results and the timing of events could differ materially from those
anticipated in these forward-looking statements as a result of
several factors. In particular, you should consider the risks
discussed under the heading “Risk Factors” in our annual report on
Form 20-F for the year ended December 31, 2015 and information
contained in other documents filed with or furnished to the
Securities and Exchange Commission. You should not rely upon
forward-looking statements as predictions of future events.
Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee that
future results, levels of activity, performance and events and
circumstances reflected in the forward-looking statements will be
achieved or will occur. The forward-looking statements made herein
speak only as of the date of this announcement and MediWound
undertakes no obligation to update publicly such forward-looking
statements to reflect subsequent events or circumstances, except as
otherwise required by law.
Contacts:
Sharon
Malka
Chief Financial and Operations
Officer
MediWound
ir@mediwound.co.il
Anne Marie FieldsSenior Vice
PresidentLHA212-838-3777afields@lhai.com
-Tables to Follow –
CONDENSED CONSOLIDATED BALANCE
SHEETS |
U.S. dollars in thousands |
|
|
|
September 30, |
|
December 31, |
|
|
2016 |
|
2015 |
|
2015 |
|
|
Unaudited |
|
Audited |
CURRENT
ASSETS: |
|
|
|
|
|
|
Cash,
cash equivalents and short term deposits |
|
33,956 |
|
49,948 |
|
45,768 |
Accounts and other receivable |
|
2,606 |
|
2,009 |
|
2,912 |
Inventories |
|
1,063 |
|
1,639 |
|
1,715 |
|
|
37,625 |
|
53,596 |
|
50,395 |
LONG‑TERM ASSETS: |
|
|
|
|
|
|
Long
term deposits and deferred costs |
|
103 |
|
234 |
|
192 |
Property, plant and equipment, net |
|
1,362 |
|
1,096 |
|
1,040 |
Intangible assets, net |
|
831 |
|
887 |
|
896 |
|
|
2,296 |
|
2,217 |
|
2,128 |
|
|
39,921 |
|
55,813 |
|
52,523 |
CURRENT
LIABILITIES: |
|
|
|
|
|
|
Trade
payables |
|
1,031 |
|
1,253 |
|
1,123 |
Accrued
expenses and other payables |
|
3,950 |
|
2,121 |
|
4,083 |
|
|
4,981 |
|
3,374 |
|
5,206 |
LONG‑TERM LIABILITIES: |
|
|
|
|
|
|
Deferred revenues |
|
1,067 |
|
- |
|
- |
Liabilities in respect of Chief Scientist government grants net of
current maturities |
|
7,637 |
|
6,161 |
|
7,275 |
Contingent consideration for the purchase of treasury shares net of
current maturities |
|
17,265 |
|
15,721 |
|
16,475 |
Severance pay liability, net |
|
99 |
|
7 |
|
97 |
|
|
26,068 |
|
21,889 |
|
23,847 |
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY |
|
8,872 |
|
30,550 |
|
23,470 |
|
|
39,921 |
|
55,813 |
|
52,523 |
CONDENSED CONSOLIDATED UNAUDITED
STATEMENTS OF COMPREHENSIVE LOSS |
U.S. dollars in thousands (except share
and per share data) |
|
|
Nine months ended |
|
Three months ended |
September 30, |
September 30, |
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
|
|
|
|
|
|
Revenues |
|
1,128 |
|
|
|
334 |
|
|
|
518 |
|
|
|
102 |
|
Cost of
revenues |
|
1,303 |
|
|
|
1,830 |
|
|
|
474 |
|
|
|
824 |
|
Gross loss |
|
(175 |
) |
|
|
(1,496 |
) |
|
|
44 |
|
|
|
(722 |
) |
Operating expenses: |
|
|
|
|
|
|
|
Research
and development, gross |
|
11,420 |
|
|
|
5,295 |
|
|
|
3,947 |
|
|
|
1,944 |
|
Participation by OCS & others |
|
(5,135 |
) |
|
|
(1,568 |
) |
|
|
(1,592 |
) |
|
|
(1,108 |
) |
Research
and development, net |
|
6,285 |
|
|
|
3,727 |
|
|
|
2,355 |
|
|
|
836 |
|
Selling,
general & administrative |
|
9,188 |
|
|
|
9,174 |
|
|
|
2,633 |
|
|
|
2,805 |
|
Total operating expenses |
|
15,473 |
|
|
|
12,901 |
|
|
|
4,988 |
|
|
|
3,641 |
|
Operating loss |
|
(15,648 |
) |
|
|
(14,397 |
) |
|
|
(4,944 |
) |
|
|
(4,363 |
) |
Financial income (expenses), net |
|
(1,348 |
) |
|
|
506 |
|
|
|
(767 |
) |
|
|
597 |
|
Loss from continuing operations |
|
(16,996 |
) |
|
|
(13,891 |
) |
|
|
(5,711 |
) |
|
|
(3,766 |
) |
Loss
from discontinued operation |
|
- |
|
|
|
(417 |
) |
|
|
- |
|
|
|
- |
|
Loss for the period |
|
(16,996 |
) |
|
|
(14,308 |
) |
|
|
(5,711 |
) |
|
|
(3,766 |
) |
|
|
|
|
|
|
|
|
Foreign
currency translation adjustments |
|
(4 |
) |
|
|
1 |
|
|
|
(1 |
) |
|
|
- |
|
Total comprehensive loss |
|
(17,000 |
) |
|
|
(14,307 |
) |
|
|
(5,712 |
) |
|
|
(3,766 |
) |
|
|
|
|
|
|
|
|
Basic and diluted loss per share: |
|
|
|
|
|
|
|
Loss
from continuing operations |
|
(0.78 |
) |
|
|
(0.64 |
) |
|
|
(0.26 |
) |
|
|
(0.17 |
) |
Loss
from discontinued operation |
|
- |
|
|
|
(0.02 |
) |
|
|
- |
|
|
|
- |
|
Net loss per share |
|
(0.78 |
) |
|
|
(0.66 |
) |
|
|
(0.26 |
) |
|
|
(0.17 |
) |
|
|
|
|
|
|
|
|
Weighted
average number of ordinary shares used in the computation of basic
and diluted loss per share: |
|
21,853 |
|
|
|
21,674 |
|
|
|
21,857 |
|
|
|
21,801 |
|
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF
CASH FLOWS |
U.S. dollars in thousands |
|
|
Nine months ended |
|
Three months ended |
September 30, |
|
September 30, |
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
Unaudited |
|
Unaudited |
Cash Flows from Operating
Activities: |
|
|
|
|
|
|
|
Net loss |
|
(16,996 |
) |
|
|
(14,308 |
) |
|
|
(5,711 |
) |
|
|
(3,766 |
) |
|
|
|
|
|
|
|
|
Adjustments to reconcile
net loss to net cash used in continuing operating activities: |
|
|
|
|
|
|
|
Adjustments to profit and loss
items: |
|
|
|
|
|
|
|
Loss from discontinued
operation |
|
- |
|
|
|
417 |
|
|
|
- |
|
|
|
- |
|
Depreciation and amortization |
|
386 |
|
|
|
350 |
|
|
|
133 |
|
|
|
120 |
|
Share-based compensation |
|
2,400 |
|
|
|
1,960 |
|
|
|
613 |
|
|
|
657 |
|
Revaluation of liabilities in
respect of Chief Scientist government grants |
|
(190 |
) |
|
|
(944 |
) |
|
|
(167 |
) |
|
|
(894 |
) |
Revaluation of contingent
consideration for the purchase of treasury shares |
|
1,180 |
|
|
|
(1,361 |
) |
|
|
641 |
|
|
|
(870 |
) |
Net financing (income)
expenses |
|
(367 |
) |
|
|
(10 |
) |
|
|
(107 |
) |
|
|
(63 |
) |
|
|
3,409 |
|
|
|
412 |
|
|
|
1,113 |
|
|
|
(1,050 |
) |
Changes in asset and liability
items: |
|
|
|
|
|
|
|
Increase in trade receivables |
|
(245 |
) |
|
|
(47 |
) |
|
|
(90 |
) |
|
|
16 |
|
Increase in other receivables |
|
425 |
|
|
|
110 |
|
|
|
754 |
|
|
|
121 |
|
Decrease (increase) in
inventories |
|
642 |
|
|
|
(357 |
) |
|
|
96 |
|
|
|
139 |
|
Increase (decrease) in trade
payables |
|
(97 |
) |
|
|
48 |
|
|
|
(539 |
) |
|
|
256 |
|
Increase in other payables |
|
647 |
|
|
|
(572 |
) |
|
|
7 |
|
|
|
(980 |
) |
|
|
1,372 |
|
|
|
(818 |
) |
|
|
228 |
|
|
|
(448 |
) |
Net cash flows
used in operating activities |
|
(12,215 |
) |
|
|
(14,714 |
) |
|
|
(4,370 |
) |
|
|
(5,264 |
) |
Cash Flows from Investment
Activities: |
|
|
|
|
|
|
|
Purchase of property and
equipment |
|
(642 |
) |
|
|
(298 |
) |
|
|
(202 |
) |
|
|
(129 |
) |
Interest received |
|
45 |
|
|
|
84 |
|
|
|
4 |
|
|
|
58 |
|
Proceeds from (investment
in) short term bank deposits, net of investments |
|
(25,239 |
) |
|
|
14,176 |
|
|
|
(1,505 |
) |
|
|
16,072 |
|
Net cash (used in)
provided by investing activities |
|
(25,836 |
) |
|
|
13,962 |
|
|
|
(1,703 |
) |
|
|
16,001 |
|
Cash Flows from Financing
Activities: |
|
|
|
|
|
|
|
Proceeds from exercise of
options |
|
2 |
|
|
|
26 |
|
|
|
2 |
|
|
|
6 |
|
Proceeds from the Chief
Scientist government grants, net of repayments |
|
658 |
|
|
|
109 |
|
|
|
658 |
|
|
|
34 |
|
Net cash provided
by financing activities |
|
660 |
|
|
|
135 |
|
|
|
660 |
|
|
|
40 |
|
Increase in cash and cash
equivalents |
|
(37,391 |
) |
|
|
(617 |
) |
|
|
(5,413 |
) |
|
|
10,777 |
|
Exchange rate differences
on cash and cash equivalent balances |
|
71 |
|
|
|
(255 |
) |
|
|
1 |
|
|
|
(4 |
) |
Balance of cash and cash
equivalents at the beginning of the period |
|
42,502 |
|
|
|
25,422 |
|
|
|
10,594 |
|
|
|
13,777 |
|
Balance of cash
and cash equivalents at the end of the period |
|
5,182 |
|
|
|
24,550 |
|
|
|
5,182 |
|
|
|
24,550 |
|
ADJUSTED EBITDA |
U.S. dollars in thousands |
|
|
Nine months ended |
|
Three months ended |
|
September 30, |
September 30, |
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
Loss for
the period |
|
(16,996 |
) |
|
|
(14,308 |
) |
|
|
(5,711 |
) |
|
|
(3,766 |
) |
Adjustments: |
|
|
|
|
|
|
|
Financial (expenses) income, net |
|
(1,348 |
) |
|
|
506 |
|
|
|
(767 |
) |
|
|
597 |
|
Loss
from discontinued operation |
|
0 |
|
|
|
(417 |
) |
|
|
0 |
|
|
|
0 |
|
Depreciation and amortization |
|
(386 |
) |
|
|
(350 |
) |
|
|
(133 |
) |
|
|
(120 |
) |
Share-based compensation expenses |
|
(2,400 |
) |
|
|
(1,960 |
) |
|
|
(613 |
) |
|
|
(657 |
) |
Total
adjustments |
|
(4,134 |
) |
|
|
(2,221 |
) |
|
|
(1,513 |
) |
|
|
(180 |
) |
Adjusted EBITDA |
|
(12,862 |
) |
|
|
(12,087 |
) |
|
|
(4,198 |
) |
|
|
(3,586 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues |
|
391 |
|
|
|
271 |
|
|
|
131 |
|
|
|
68 |
|
Research and development |
|
579 |
|
|
|
375 |
|
|
|
194 |
|
|
|
128 |
|
Selling, general and administrative |
|
1,430 |
|
|
|
1,314 |
|
|
|
288 |
|
|
|
461 |
|
Total share-based compensation expenses |
|
2,400 |
|
|
|
1,960 |
|
|
|
613 |
|
|
|
657 |
|
MediWound (NASDAQ:MDWD)
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MediWound (NASDAQ:MDWD)
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