CORREVIO PHARMA CORP NASDAQ: CRME TSX: COM
Management to Host Conference Call and Webcast Today,
August 8, 2017 at 4:30 p.m. ET (1:30 p.m. PT)
VANCOUVER, Aug. 8, 2017 /PRNewswire/ - Cardiome Pharma Corp. (NASDAQ: CRME / TSX: COM) today reported financial results for the second quarter ended June 30, 2017 and commented on recent accomplishments and plans.
"Our second quarter was marked by several business development and regulatory accomplishments which pave the way for increased access to our products internationally," commented William Hunter, MD, CEO and President of Cardiome. "Our commercial launch of BRINAVESS(®) in Canada continues to expand our geographic footprint, and we look forward to making additional products available to our Canadian sales force as we work alongside the provincial formularies. These efforts are expected to be supplemented by targeting Canadian NDS filings for TREVYENT(®) and XYDALBA((TM)) later this year. These achievements are important steps as we continue to build a commercial portfolio of differentiated hospital products that address patient needs, and make these products available through our global distribution capabilities."
Second Quarter 2017 and Recent Highlights
-- Cardiome received authorization from Health Canada to commercialize
BRINAVESS(®) (vernakalant hydrochloride, IV) in Canada. The product is
currently available on the Ontario formulary, with a broader launch
across multiple provincial formularies anticipated in the third quarter
of 2017 and early 2018.
-- Cardiome received approval from Health Canada for the AGGRASTAT(®)
(tirofiban hydrochloride) high dose bolus (HDB) regimen, better aligning
the Canadian, United States, and European product labels.
-- Cardiome's partner SteadyMed submitted a New Drug Application to the
U.S. Food and Drug Administration for TREVYENT(®) (treprostinil
injection) for the treatment of pulmonary arterial hypertension. This
filing will assist Cardiome in preparing submissions for TREVYENT in
both the European Union and Canada before the end of 2017.
-- Cardiome signed an exclusive license and distribution agreement with
Tzamal Medical Ltd. to support the planned commercialization of
XYDALBA(TM) (dalbavancin hydrochloride) in Israel, anticipating a timely
registration and launch within the next 18 months.
-- Cardiome announced changes to its senior management team, including the
appointment of Justin Renz as Chief Financial Officer, Jennifer
Archibald as Chief Business Operations Officer, David Dean as Chief
Business Development Officer, and Hugues Sachot as Chief Commercial
Officer.
-- Cardiome expanded its term loan agreement with CRG-managed funds,
providing the Company with up to $50 million of available borrowing
capacity.
-- Cardiome's partner SteadyMed completed a TREVYENT(®) (treprostinil
injection) clinical validation study successfully demonstrating dose
accuracy and precision of the PatchPump delivery system.
Summary Results
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).
Cardiome recorded a net loss of $8.5 million (basic loss per share of $0.26) for the three months ended June 30, 2017, compared to a net loss of $7.5 million (basic loss per share of $0.37) for the three months ended June 30, 2016. On a year-to-date basis, Cardiome recorded a net loss of $14.8 million (basic loss per share of $0.46) for the six months ended June 30, 2017 compared to a net loss of $8.7 million (basic loss per share of $0.43) for the six months ended June 30, 2016. The increase in net loss on a year-to-date basis was due primarily to an increase in selling, general and administration ("SG&A") expense and a decrease in revenue.
Revenue for the three months ended June 30, 2017 was $5.8 million compared to revenue of $5.9 million for the three months ended June 30, 2016. Revenue for the six months ended June 30, 2017 and 2016 was $11.0 million and $13.0 million, respectively. The decrease in revenue for the six months ended June 30, 2017 was due to the timing of distributor sales. During the six months ended June 30, 2016, Cardiome recorded revenue of $1.7 million from an annual order to a distributor. The annual order for 2017 from that distributor will be split into two orders and Cardiome expects that at least one shipment will be shipped and recorded in the third quarter of this year.
Gross margin for the three and six months ended June 30, 2017 was 70.1% and 69.4%, respectively, compared to 71.5% and 76.1% for the three and six months ended June 30, 2016. The fluctuation in gross margin is primarily due to changes in customer mix. A significant portion of Cardiome's sales during the three and six months ended June 30, 2017 was to a distributor with lower margins.
SG&A expense for the three months ended June 30, 2017 was $9.6 million compared to $8.0 million for the three months ended June 30, 2016. The increase in SG&A expense was primarily due to expansion of Cardiome's direct sales force in Europe related to the launch of XYDALBA(TM) and to the initiation of a Canadian sales force. On a year-to-date basis, SG&A expense for the six months ended June 30, 2017 was $17.8 million compared to $14.2 million for the six months ended June 30, 2016. The increase in SG&A expense was primarily due to expansion of Cardiome's direct sales force in Europe related to the launch of XYDALBA(TM) and to the initiation of a Canadian sales force. Additionally, there was an increase of $1.6 million to the Company's stock-based compensation expense as a result of market fluctuations in Cardiome's share price.
In the second quarter of 2017, the Company amended the terms of its term loan agreement with CRG-managed funds. As a result, Cardiome incurred investment banking, legal and other expenses of $1.4 million during the three and six months ended June 30, 2017.
Interest expense was $1.2 million for the three months ended June 30, 2017, compared to $0.4 million for the three months ended June 30, 2016. The increase was due to an increase in long-term debt in the second quarter of 2017 as the Company amended the terms of the CRG term loan agreement. On a year-to-date basis, interest expense for the six months ended June 30, 2017 was $2.0 million compared to $0.9 million for the six months ended June 30, 2016. The increase was due to interest being accrued on a higher long-term debt principal amount during the six months ended June 30, 2017.
Liquidity and Outstanding Share Capital
At June 30, 2017, the Company had cash and cash equivalents of $28.4 million. As of August 7, 2017, there were 33,801,015 common shares issued and outstanding, and 2,919,557 common shares issuable upon the exercise of outstanding stock options (of which 1,461,093 were exercisable) at a weighted average exercise price of CAD $5.40 per share, and 108,673 restricted share units outstanding.
Conference Call
Cardiome will hold a conference call and webcast on Tuesday, August 8, 2017 at 4:30pm ET (1:30pm PT). To access the conference call, please dial 416-764-8688 or 888-390-0546 and use conference ID 72064400. The webcast can be accessed through Cardiome's website at www.cardiome.com or through the following link:
https://event.on24.com/wcc/r/1467066/DC894F8190C6D4AEF9EB1B450D4BF071
Webcast and telephone replays of the conference call will be available approximately two hours after the completion of the call through September 8, 2017. Please dial 416-764-8677 or 888-390-0541 and enter code 064400 # to access the replay.
About Cardiome Pharma Corp.
Cardiome Pharma Corp. is a specialty pharmaceutical company dedicated to the development and commercialization of innovative therapies that will improve the quality of life and health of patients suffering from disease. Cardiome has two marketed, in-hospital, cardiology products, BRINAVESS(®) (vernakalant IV), approved in Europe, Canada, and other countries for the rapid conversion of recent onset atrial fibrillation to sinus rhythm in adults, and AGGRASTAT(®) (tirofiban hydrochloride) 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 Amomed in select European markets. Cardiome has also licensed: XYDALBA((TM)) (dalbavancin hydrochloride), a second generation, semi-synthetic lipoglycopeptide approved in the EU for the treatment of acute bacterial skin and skin structure infections (ABSSSI) in adults for select European and Middle Eastern countries and Canada from Allergan; and TREVYENT(®), a development stage drug device combination that is under development for Pulmonary Arterial Hypertension for Europe, the Middle East and for Canadian markets from SteadyMed Therapeutics.
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 2017 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; and the availability of capital to finance our activities;These and other risks are described in the Form 40F and associated documents filed March 29, 2017 (see for example, "Risk Factors" in the Annual Information Form for the year ended December 31, 2016), in the Form 6-K filed May 15, 2017, and in our other 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.
CARDIOME PHARMA CORP.
Interim Consolidated Balance Sheets
(Expressed in thousands of U.S. dollars, except share amounts)
June 30, December 31,
2016
2017
----
Assets
Current assets:
Cash and cash
equivalents $28,383 $26,758
Restricted cash 2,883 2,547
Accounts
receivable,
net of
allowance for
doubtful
accounts of
$110 (2016 -
$97) 5,397 6,154
Inventories 6,366 4,618
Prepaid
expenses and
other assets 1,214 1,302
------------- ----- -----
44,243
41,379
Property and equipment 480 548
Intangible assets 23,717 24,352
Goodwill 318 318
Deferred income tax assets 461 460
-------------------------- --- ---
$
$69,219 67,057
======= ======
Liabilities and Stockholders'
Equity
Current liabilities:
Accounts
payable and
accrued
liabilities $7,333 $8,021
Current portion
of deferred
consideration 1,670 2,815
Current portion
of deferred
revenue 197 182
--------------- --- ---
9,200 11,018
Long-term debt, net of
unamortized debt issuance costs
and discount 28,448 19,391
Deferred revenue 2,479 2,381
Other long-term liabilities 228 243
--------------------------- --- ---
40,355 33,033
------ ------
Stockholders' equity:
Common stock 352,390 344,928
Authorized -unlimited number
without par value
Issued and outstanding -
33,800,860 (2016 -
31,884,420)
Additional
paid-in
capital 37,508 35,812
Deficit (377,899) (363,054)
Accumulated
other
comprehensive
income 16,865 16,338
-------------- ------ ------
28,864 34,024
------ ------
$
69,219
$
67,057
======
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 Six months ended
------------------ ----------------
June 30, June 30, June 30, June 30,
2017 2016 2017 2016
---- ---- ---- ----
Revenue:
Product and royalty revenues $5,705 $5,864 $10,858 $12,907
Licensing and other fees 49 47 95 94
------------------------ --- --- --- ---
5,754 5,911 10,953 13,001
Cost of goods sold 1,721 1,685 3,357 3,110
------------------ ----- ----- ----- -----
Gross margin 4,033 4,226 7,596 9,891
Expenses:
Selling, general and
administration 9,576 7,977 17,796 14,245
Amortization 842 750 1,677 1,278
------------ --- --- ----- -----
10,418 8,727 19,473 15,523
------ ----- ------ ------
Operating loss (6,385) (4,501) (11,877) (5,632)
Other expense:
Loss on extinguishment of long-
term debt - 1,402 - 1,402
Other expense on modification
of long-term debt 1,422 - 1,422 -
Interest expense 1,247 445 2,034 850
Other expense 29 111 107 335
Foreign exchange (gain) loss (559) 961 (626) 392
---------------------------- ---- --- ---- ---
2,139 2,919 2,937 2,979
----- ----- ----- -----
Loss before income taxes (8,524) (7,420) (14,814) (8,611)
Income tax expense (recovery) (12) 94 31 137
---------------------------- --- --- --- ---
Net loss $(8,512) $(7,514) $(14,845) $(8,748)
-------- ------- ------- -------- -------
Other comprehensive income (loss):
Foreign currency translation
adjustments 441 660 527 366
----------------------------- --- --- --- ---
Comprehensive loss $(8,071) $(6,854) $(14,318) $(8,382)
================== ======= ======= ======== =======
Loss per common share
Basic $(0.26) $(0.37) $(0.46) $(0.43)
Diluted $(0.26) $(0.37) $(0.46) $(0.46)
======= ====== ====== ====== ======
Weighted average common shares
outstanding
Basic 32,441,211 20,358,724 32,168,840 20,329,011
Diluted 32,441,211 20,358,724 32,168,840 20,404,593
------- ---------- ---------- ---------- ----------
CARDIOME PHARMA CORP.
Interim Consolidated Statements of Cash Flows
(Unaudited)
(Expressed in thousands of U.S. dollars)
Three months ended Six months ended
------------------ ----------------
June 30, June 30, June 30, June 30,
2017 2016
2017 2016
---- ----
Operating activities:
Net loss $(8,512) $(7,514) $(14,845) $(8,748)
Items not affecting cash:
Amortization 842 750 1,677 1,278
Amortization of deferred financing fees 41 57 87 146
Accretion of long-term debt 41 - 41 -
Write-down of inventory - - 70 -
Loss on extinguishment of long-term debt - 1,402 - 1,402
Stock-based compensation expense (recovery) 937 420 1,330 (293)
Unrealized foreign exchange gain (loss) (800) 539 (972) 353
Changes in operating assets and liabilities:
Restricted cash 2 3 (194) (295)
Accounts receivable 447 810 1,176 (512)
Inventories (351) 6 (1,482) (29)
Prepaid expenses and other assets 285 - 102 (503)
Accounts payable and accrued liabilities (411) 1,946 (1,259) 459
Deferred revenue (49) (47) (95) (94)
Other long-term liabilities 268 (7) 260 (15)
--------------------------- --- --- --- ---
Net cash used in operating activities (7,260) (1,635) (14,104) (6,851)
Investing activities:
Purchase of property and equipment (5) - (5) (9)
Purchase of intangible assets (1) (5,596) (13) (5,611)
----------------------------- --- ------ --- ------
Net cash used in investing activities (6) (5,596) (18) (5,620)
Financing activities:
Issuance of common stock 6,890 - 6,890 841
Share issue costs (342) (7) (342) (30)
Issuance of common stock upon exercise of stock options 364 - 384 -
Income tax withholdings on vesting of restricted share units (47) (129) (49) (131)
Proceeds from issuance of long-term debt 10,000 20,000 10,000 20,000
Financing fees on issuance of long-term debt (150) (662) (150) (690)
Repayment of long-term debt - (9,000) - (10,000)
Payment of fees on extinguishment of long-term debt - (1,146) - (1,146)
Payment of deferred consideration (547) (521) (1,145) (1,029)
--------------------------------- ---- ---- ------ ------
Net cash provided by financing activities 16,168 8,535 15,588 7,815
Increase (decrease) in cash and cash equivalents during the period 8,902 1,304 1,466 (4,656)
------------------------------------------------------------------ ----- ----- ----- ------
Effect of foreign exchange rate changes on cash and cash equivalents 108 43 159 (121)
Cash and cash equivalents, beginning of period 19,373 11,537 26,758 17,661
---------------------------------------------- ------ ------ ------ ------
Cash and cash equivalents, end of period $28,383 $12,884 $28,383 $12,884
======================================== ======= ======= ======= =======
Supplemental cash flow information:
Interest paid $889 $389 $1,636 $709
Net income taxes paid (received) 35 (49) (353) (15)
=============================== === === ==== ===
SOURCE Cardiome Pharma Corp.
