TEL AVIV, Israel and RALEIGH, N.C., March 18, 2021 /PRNewswire/ --

Financials:

Full year 2020 net revenues of approximately $64 million, with gross profit of approximately $27.5 million

Solid cash balance of approximately $100 million as of March 4, 2021

Planned commercial operational breakeven by the end of 2021

Commercial Highlights:

Talicia: Consistent month-over-month prescription growth despite pandemic conditions, with 52% new prescription growth in Q4/2020 compared to Q3/2020

Movantik: Market leadership position holding strong and well-positioned for further growth in 2021

R&D Highlights:

Two advanced programs at the forefront of global COVID-19 novel therapeutics development:

  • Opaganib: Ongoing global Phase 2/3 study in hospitalized patients approximately two thirds enrolled, data expected Q2/2021; Positive U.S. Phase 2 data reported

  • RHB-107: Ongoing U.S. Phase 2/3 study in symptomatic non-hospitalized patients

RHB-204: Ongoing Phase 3 study for pulmonary NTM disease as oral first-line treatment

Management to host webcast today, at 8:30 a.m. EDT

RedHill Biopharma Ltd. (Nasdaq: RDHL) ("RedHill" or the "Company"), a specialty biopharmaceutical company, today reported its financial results and operational highlights for the year ended December 31, 2020.

RedHill Biopharma Logo (PRNewsfoto/RedHill Biopharma)

Dror Ben-Asher, RedHill's Chief Executive Officer, said: "2020 was a year that our team looks back on with a sense of immense achievement. While navigating the challenging conditions caused by the pandemic, we have delivered broad commercial growth culminating in a very strong end to 2020 for both Movantik and Talicia". Mr. Ben-Asher continued: "At the same time, we have rapidly progressed two novel oral COVID-19 therapies to Phase 3 stage development, covering both hospitalized and non-hospitalized patients and have reported positive clinical and preclinical data, positioning RedHill at the forefront of novel COVID-19 therapeutics development worldwide. With strong momentum across both commercial and R&D operations, we expect 2021 to be a breakout year."

Micha Ben Chorin, Chief Financial Officer at RedHill, added: "RedHill is delivering on a clear strategy designed to enable us to achieve fast growth and increased profit margin. We have been diligent in maintaining a solid balance sheet and we expect to achieve commercial operational breakeven by the end of this year." 

Financial highlights for the year ended December 31, 2020

Net Revenues were approximately $64 million for the year ended December 31, 2020, an increase of $58 million compared to the year ended December 31, 2019, attributed to revenues generated from the commercialization of Movantik and Talicia initiated in 2020. Net revenues for the fourth quarter of 2020 were approximately $21.5 million, an increase of $0.5 million compared to the third quarter of 2020, with a 12% increase in product delivery.

Gross Profit was approximately $27.5 million for the year ended December 31, 2020, an increase of $23.5 million compared to the year ended December 31, 2019, primarily due to the increase in net revenues.

Research and Development Expenses were approximately $16.5 million for the year ended December 31, 2020, mainly attributable to the development of our COVID-19 therapeutics and the Phase 3 study of RHB-204 for pulmonary NTM disease, and were, in total, lower than the research and development expenses for the year ended December 31, 2019.

Selling, Marketing and Business Development Expenses were approximately $49 million for the year ended December 31, 2020, compared to approximately $18 million for the year ended December 31, 2019. The increase was attributable to the expansion of our U.S. sales force and marketing activities, in support of the launch of Talicia and post-acquisition commercialization of Movantik.

General and Administrative Expenses were approximately $25 million for the year ended December 31, 2020, compared to approximately $11 million for the year ended December 31, 2019. The increase was mainly attributable to the expansion of commercialization activities related to the Talicia launch and the Movantik acquisition from AstraZeneca.

Operating Loss was approximately $64 million for the year ended December 31, 2020, compared to approximately $43 million for the year ended December 31, 2019. The increase was attributable to the expansion of our commercial operations.

Net Loss was approximately $76 million for the year ended December 31, 2020, compared to approximately $42 million for the year ended December 31, 2019. The increase was attributable to factors mentioned above, as well as interest expenses mainly related to the royalty and debt financing in the first quarter of 2020. 

Net Cash Used in Operating Activities was approximately $49 million for the year ended December 31, 2020, compared to approximately $41 million for the year ended December 31, 2019. The increase was attributable to the increase in operating loss, as described above.

Net Cash Used in Investing Activities was approximately $36 million for the year ended December 31, 2020, primarily related to the $52.5 million upfront payment to AstraZeneca for the acquisition of Movantik, partially offset by inflow from current bank deposits and financial assets at fair value through profit or loss. 

Net Cash Provided by Financing Activities was approximately $84 million for the year ended December 31, 2020, comprised primarily from financing inflow of approximately $102 million, mainly in debt and equity, partially offset by $16 million classified as restricted cash.

Liquidity and Capital Resources

Cash Balance[1] as of December 31, 2020, was approximately $46 million. Cash balance as of March 4, 2021 was approximately $100 million.

Commercial Highlights

Movantik® (naloxegol)[2]
The Company has completed three full quarters of Movantik promotion following its acquisition from AstraZeneca, achieving: A reversal of the trend of declining new prescriptions prior to the acquisition, maintaining Movantik's position as a segment-leading brand and ending 2020 strongly recording the second highest monthly new prescription volume of 2020 in December.

RedHill acquired the global rights to Movantik from AstraZeneca, excluding Europe and Canada, subsequently adding Israel rights, and replaced a co-commercialization agreement with Daiichi Sankyo (assigned under the agreement with AstraZeneca), with a new royalty-bearing agreement that resulted in RedHill assuming full control over brand strategy and commercialization activities for Movantik in the U.S. and increasing gross margin.

Talicia® (omeprazole magnesium, amoxicillin and rifabutin)[3]
Despite the challenging pandemic environment, the Company has persisted in its efforts to support the launch and rapid growth of Talicia, in particular in expanding the prescriber base. This has resulted in the strong accumulation of new Talicia prescribers in the second half of 2020 and consistent month-over-month prescription growth despite pandemic conditions. Talicia ended 2020 strongly, with 52% new prescription growth in the fourth quarter of 2020, as compared to the previous quarter, and achieving its highest weekly new prescription volume in December.  

This growth is supported by the addition of Talicia as a preferred brand on leading national formularies, approaching 70% U.S. commercial coverage in the fourth quarter, with further formulary additions expected to add to the previously announced listings of Talicia on the national formularies of Prime Therapeutics, EnvisionRx, and Express Scripts.

Aemcolo® (rifamycin)[4]
The Company has implemented plans to support, and build on, the initial momentum that Aemcolo was generating pre-COVID-19 travel restrictions. The Company expects that these plans will drive a resurgence of interest in Aemcolo once travel restrictions are lifted and international travel from the U.S. returns to significant levels.

R&D Highlights

COVID-19 Program: Opaganib (ABC294640, Yeliva®)[5] 
The late-stage development program for novel, orally-administered, opaganib in patients with severe COVID-19 pneumonia is progressing rapidly. Opaganib has demonstrated dual anti-inflammatory and antiviral activity, targeting a human cell component involved in viral replication and therefore expected to be effective against emerging viral strains with mutations in the spike protein.

The global Phase 2/3 randomized, double-blind, parallel-arm, placebo-controlled study of opaganib in patients with severe COVID-19 pneumonia requiring hospitalization and treatment with supplemental oxygen (NCT04467840), is rapidly advancing in a total of 8 countries and approximately 40 recruiting sites, with additional expansion ongoing. The study has passed three Data Safety Monitoring Board reviews, including a futility review, which is suggestive that the study is progressing as expected. The 464-patient study has already enrolled approximately two thirds of the patients and is expected to deliver top-line data in the second quarter of 2021.

In December 2020, the Company reported positive top-line safety and efficacy data from the U.S. Phase 2 study with opaganib in patients with COVID-19 pneumonia, in which opaganib demonstrated greater improvement in reducing oxygen requirement by end of treatment on Day 14, on top of standard-of-care. The Phase 2 data also showed no material safety differences between the opaganib and placebo treatment arms - further adding to the growing opaganib safety database.

In September 2020, RedHill announced that opaganib demonstrated potent inhibition of SARS-CoV-2, achieving complete blockage of viral replication, as measured after three days incubation, in an in vitro model of human bronchial tissue, comparing favorably with remdesivir, the positive control in the study. Furthermore, treatment of cells infected with SARS-CoV-2 with opaganib did not compromise cell membrane integrity, a measure of cell viability and drug safety, further demonstrating opaganib's promising potential for treating patients with COVID-19. On top of its anti-inflammatory mechanism, opaganib is also one of very few orally available broad-spectrum antivirals in advanced clinical evaluation for treating COVID-19.

The Company also signed collaborations with several U.S., European and Canadian suppliers, including with Cosmo Pharmaceuticals NV (SIX: COPN) for large-scale ramp-up of opaganib manufacturing, further strengthening manufacturing capabilities and capacity for opaganib.

The Company continues its discussions with U.S. and other government agencies and non-governmental organizations around potential funding to support the rapid advancement of opaganib toward potential emergency use applications and manufacturing scale-up.

COVID-19 Program: RHB-107 (upamostat)[6]
In February 2021, RedHill announced dosing of the first patient in the U.S. Phase 2/3 COVID-19 outpatient study with novel, orally-administered, RHB-107 (upamostat). The study with once-daily RHB-107 is evaluating treatment of patients with symptomatic COVID-19 who do not require hospitalization - the vast majority of COVID-19 patients. The study allows patients to remain in the comfort of their home yet be monitored at a level previously possible only in a hospital setting, enabling increased compliance and retention rates.

RHB-107 is a novel, orally-administered, serine protease inhibitor targeting human cell factors involved in viral entry and is therefore expected to be effective against emerging viral variants with mutations in the spike protein. In previously announced in vitro results, RHB-107 strongly inhibited SARS-CoV-2 viral replication.

RHB-204[7] - Pulmonary Nontuberculous Mycobacteria (NTM) Disease      
In November 2020, RedHill commenced its U.S. Phase 3 study to evaluate the efficacy and safety of RHB-204 in adults with pulmonary NTM disease caused by Mycobacterium avium Complex (MAC) infection.

The FDA also granted Fast Track designation for RHB-204 in January 2021, providing early and frequent communications and a rolling review of any New Drug Application (NDA). Having already been granted Qualified Infectious Disease Product (QIDP) designation, RHB-204 is also eligible for NDA Priority Review and Accelerated Approval.

In October 2020, the Company announced that RHB-204 had been granted FDA Orphan Drug Designation. This, along with the previously granted QIDP designation, extends U.S. market exclusivity for RHB-204 to a potential total of 12 years upon FDA approval.

Opaganib - Cholangiocarcinoma and Prostate Cancer
The Phase 2a study evaluating the activity of opaganib in advanced cholangiocarcinoma (bile duct cancer) is ongoing. Enrollment has been completed for the first cohort of 39 patients, evaluating the activity of orally-administered opaganib as a stand-alone treatment. Preliminary data from this cohort indicated a signal of activity in a number of subjects with advanced cholangiocarcinoma. Enrollment is ongoing for a second cohort, evaluating opaganib in combination with hydroxychloroquine, an anti-autophagy agent.

In light of preclinical findings demonstrating tumor regression following combination treatment with opaganib and RHB-107 (upamostat), RedHill plans to add an additional cohort to the ongoing Phase 2a study, evaluating opaganib in combination with RHB-107, subject to discussions with the FDA. Opaganib has been granted FDA Orphan Drug Designation for the treatment of cholangiocarcinoma.

An additional Phase 2 study with opaganib in prostate cancer is ongoing at the Medical University of South Carolina (MUSC). The study is supported by a National Cancer Institute grant awarded to MUSC with additional support from RedHill.

COVID-19 Impact Update

RedHill's primary concern during the COVID-19 pandemic continues to be the safety and health of its employees, patients, colleagues, and the communities to which we belong.

Operationally, the actions the Company took to mitigate the impact of the COVID-19 pandemic continue to serve us well, with minimal effect on our ongoing operational and supply chain activities. Promotional activity has now been largely re-instated, where safe to do so, and in adherence to social distancing and other public health guidelines. RedHill will continue to assess the potential impact of COVID-19 on its business and operations.

Conference Call and Webcast Information:

The Company will host a conference call and live webcast today, Thursday, March 18, 2021, at 8:30 a.m. EDT to present the fourth quarter and full year 2020 financial results and operational highlights.

The webcast and slides will be broadcast live on the Company's website, https://ir.redhillbio.com/events, and will be available for replay for 30 days.         

To participate in the conference call, please dial one of the following numbers 15 minutes prior to the start of the call: United States: +1-877-870-9135; International: +1-646-741-3167 and Israel:
+972-3-530-8845; the access code for the call is: 1830718.

About RedHill Biopharma    
RedHill Biopharma Ltd. (Nasdaq: RDHL) is a specialty biopharmaceutical company primarily focused on gastrointestinal and infectious diseases. RedHill promotes the gastrointestinal drugs, Movantik® for opioid-induced constipation in adults, Talicia® for the treatment of Helicobacter pylori (H. pylori) infection in adults, and Aemcolo® for the treatment of travelers' diarrhea in adults. RedHill's key clinical late-stage development programs include: (i) RHB-204, with an ongoing Phase 3 study for pulmonary nontuberculous mycobacteria (NTM) disease; (ii) opaganib (Yeliva®, ABC294640), a first-in-class SK2 selective inhibitor targeting multiple indications with a Phase 2/3 program for COVID-19 and Phase 2 studies for prostate cancer and cholangiocarcinoma ongoing; (iii) RHB-107 (upamostat), a serine protease inhibitor in a U.S. Phase 2/3 study as treatment for symptomatic COVID-19, and targeting multiple other cancer and inflammatory gastrointestinal diseases; (iv) RHB-104, with positive results from a first Phase 3 study for Crohn's disease; (v) RHB-102 (Bekinda®), with positive results from a Phase 3 study for acute gastroenteritis and gastritis and positive results from a Phase 2 study for IBS-D; and (vi) RHB-106, an encapsulated bowel preparation. More information about the Company is available at www.redhillbio.com / https://twitter.com/RedHillBio.

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. Forward-looking statements include statements regarding planned commercial operational breakeven by the end of 2021 and regarding achieving fast growth and increased profit margin. Forward-looking statements are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company's control and cannot be predicted or quantified, and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation; the risk that the Company will not successfully commercialize its products; as well as risks and uncertainties associated with (i) the initiation, timing, progress and results of the Company's research, manufacturing, pre-clinical studies, clinical trials, and other therapeutic candidate development efforts, and the timing of the commercial launch of its commercial products and ones it may acquire or develop in the future; (ii) the Company's ability to advance its therapeutic candidates into clinical trials or to successfully complete its pre-clinical studies or clinical trials or the development of a commercial companion diagnostic for the detection of MAP; (iii) the extent and number and type of additional studies that the Company may be required to conduct and the Company's receipt of regulatory approvals for its therapeutic candidates, and the timing of other regulatory filings, approvals and feedback; (iv) the manufacturing, clinical development, commercialization, and market acceptance of the Company's therapeutic candidates and Talicia®; (v) the Company's ability to successfully commercialize and promote Talicia®, and Aemcolo® and Movantik®; (vi) the Company's ability to establish and maintain corporate collaborations; (vii) the Company's ability to acquire products approved for marketing in the U.S. that achieve commercial success and build its own marketing and commercialization capabilities; (viii) the interpretation of the properties and characteristics of the Company's therapeutic candidates and the results obtained with its therapeutic candidates in research, pre-clinical studies or clinical trials; (ix) the implementation of the Company's business model, strategic plans for its business and therapeutic candidates; (x) the scope of protection the Company is able to establish and maintain for intellectual property rights covering its therapeutic candidates and its ability to operate its business without infringing the intellectual property rights of others; (xi) parties from whom the Company licenses its intellectual property defaulting in their obligations to the Company; (xii) estimates of the Company's expenses, future revenues, capital requirements and needs for additional financing; (xiii) the effect of patients suffering adverse experiences using investigative drugs under the Company's Expanded Access Program; (xiv) competition from other companies and technologies within the Company's industry; and (xv) the hiring and employment commencement date of executive managers. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company's filings with the Securities and Exchange Commission (SEC), including the Company's Annual Report on Form 20-F filed with the SEC on March 4, 2020. All forward-looking statements included in this press release are made only as of the date of this press release. The Company assumes no obligation to update any written or oral forward-looking statement, whether as a result of new information, future events or otherwise unless required by law.

 

Company contact:

Adi Frish

Chief Corporate and Business Development
Officer

RedHill Biopharma

+972-54-6543-112

adi@redhillbio.com

 

Media contacts:

U.S.: Bryan Gibbs, Finn Partners

+1 212 529 2236

bryan.gibbs@finnpartners.com

UK: Amber Fennell, Consilium

+44 (0) 7739 658 783  

fennell@consilium-comms.com


 

REDHILL BIOPHARMA LTD.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
















Year Ended December 31, 






2020


2019


2018






U.S. dollars in thousands

NET REVENUES





64,359


6,291


8,360

COST OF REVENUES





36,892


2,259


2,837

GROSS PROFIT





27,467


4,032


5,523

RESEARCH AND DEVELOPMENT EXPENSES





16,491


17,419


24,862

SELLING, MARKETING AND BUSINESS DEVELOPMENT EXPENSES





49,285


18,333


12,486

GENERAL AND ADMINISTRATIVE EXPENSES





25,375


11,481


7,506

OPERATING LOSS





63,684


43,201


39,331

FINANCIAL INCOME





270


1,335


678

FINANCIAL EXPENSES





12,759


438


167

FINANCIAL EXPENSES (INCOME), net





12,489


(897)


(511)

LOSS AND COMPREHENSIVE LOSS FOR THE YEAR





76,173


42,304


38,820











 

REDHILL BIOPHARMA LTD.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION







December 31,


2020


2019


 U.S. dollars in thousands

CURRENT ASSETS:




Cash and cash equivalents

29,295


29,023

Bank deposits

17


10,349

Financial assets at fair value through profit or loss

481


8,500

Trade receivables

28,655


1,216

Prepaid expenses and other receivables

5,521


2,244

Inventory

6,526


1,882


70,495


53,214

NON-CURRENT ASSETS:




Restricted cash

16,164


152

Fixed assets

511


228

Right-of-use assets

5,192


3,578

Intangible assets

87,879


16,927


109,746


20,885

TOTAL ASSETS

180,241


74,099









CURRENT LIABILITIES: 




Accounts payable

11,553


4,184

Lease liabilities

1,710


834

 Allowance for deductions from revenue

18,343


1,267

Accrued expenses and other current liabilities

24,082


4,331

Payable in respect of intangible assets purchase

17,547



73,235


10,616





NON-CURRENT LIABILITIES:




Borrowing

81,386


Payable in respect of intangible assets purchase

7,199


Lease liabilities

3,807


2,981

Royalty obligation

750


500


93,142


3,481

TOTAL LIABILITIES

166,377


14,097





EQUITY:




Ordinary shares

1,054


962

Additional paid-in capital

293,144


267,403

Accumulated deficit

(280,334)


(208,363)

TOTAL EQUITY

13,864


60,002

TOTAL LIABILITIES AND EQUITY

180,241


74,099

 

REDHILL BIOPHARMA LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS











Year Ended December 31,



2020


2019


2018



U.S. dollars in thousands

OPERATING ACTIVITIES:







Comprehensive loss


(76,173)


(42,304)


(38,820)

Adjustments in respect of income and expenses not involving cash flow:







Share-based compensation to employees and service providers


4,202


3,027


2,678

Depreciation


1,710


997


90

Amortization and impairment of intangible assets


7,035


216


Non-cash interest expenses related to borrowing and payable in respect of intangible assets purchase and royalty obligation


6,032



Fair value adjustments on derivative financial instruments



(344)


(104)

Fair value losses (gains) on financial assets at fair value through profit or loss


94


(27)


137

Exchange differences and revaluation of bank deposits


101


24


138



19,174


3,893


2,939

Changes in assets and liability items:







Decrease (increase) in trade receivables


(27,439)


(258)


570

Decrease (increase) in prepaid expenses and other receivables


(3,277)


(368)


1,414

Increase in inventories


(4,644)


(1,113)


(116)

Increase (decrease) in accounts payable


7,369


860


(1,481)

Increase (decrease) in accrued expenses and other liabilities


19,335


(2,726)


722

Increase in allowance for deductions from revenue


17,076


1,267


310



8,420


(2,338)


1,419

Net cash used in operating activities


(48,579)


(40,749)


(34,462)

INVESTING ACTIVITIES:







Purchase of fixed assets


(406)


(168)


(23)

Purchase of intangible assets


(53,368)


(35)


(35)

Change in investment in current bank deposits


10,200


(2,069)


4,869

Purchase of financial assets at fair value through profit or loss



(4,325)


(6,976)

Proceeds from sale of financial assets at fair value through profit or loss


7,925


11,761


7,517

Net cash provided by (used in) investing activities


(35,649)


5,164


5,352

FINANCING ACTIVITIES:







Proceeds from issuance of ordinary shares, net of issuance costs


23,867


36,300


41,902

Exercise of options into ordinary shares


52


5


361

Proceeds from long-term borrowings, net of transaction costs


78,061



Increase in restricted cash


(20,000)



Decrease in restricted cash


4,000



Payment of principal with respect to lease liabilities


(1,610)


(796)


Repayment of payable in respect of intangible asset purchase




(500)

Net cash provided by financing activities


84,370


35,509


41,763

 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS


142


(76)


12,653

EXCHANGE DIFFERENCES ON CASH AND CASH EQUIVALENTS


130


94


(103)

BALANCE OF CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD


29,023


29,005


16,455

BALANCE OF CASH AND CASH EQUIVALENTS AT END OF PERIOD


29,295


29,023


29,005

SUPPLEMENTARY INFORMATION ON INTEREST RECEIVED IN CASH


414


753


728

SUPPLEMENTARY INFORMATION ON INTEREST PAID IN CASH


6,654


251


SUPPLEMENTARY INFORMATION ON NON-CASH INVESTING AND FINANCING ACTIVITIES:







Acquisition of right-of-use assets by means of lease liabilities


2,930


2,805


Purchase of intangible assets posted as payable


24,619



Purchase of an intangible asset in consideration for issuance of shares


1,914


11,788


 

____________________________

[1] Including cash, cash equivalents, short-term investments (bank deposits and financial assets at fair value) and restricted cash.

[2] Movantik® (naloxegol) is indicated for opioid-induced constipation (OIC). Full prescribing information see: www.movantik.com.

[3] Talicia® (omeprazole magnesium, amoxicillin and rifabutin) is indicated for the treatment of H. pylori infection in adults. For full prescribing information see: www.Talicia.com.

[4] Aemcolo (rifamycin) indicated for the treatment of travelers' diarrhea caused by noninvasive strains of Escherichia coli in adults. For full prescribing information see: www.aemcolo.com

[5] Opaganib (ABC294640, Yeliva®) is an investigational new drug, not available for commercial distribution.

[6] RHB-107 (upamostat) is an investigational new drug, not available for commercial distribution.

[7] RHB-204 is an investigational new drug, not available for commercial distribution.

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SOURCE RedHill Biopharma Ltd.

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