FY 2014 revenues of
Development efforts focused on Phase II DUET trial and preparation of RE-024 IND
- Net product sales for the fourth quarter 2014 were
$14.1 million - Net product sales for the full year 2014 were
$28.2 million - Non-GAAP operating loss for the fourth quarter 2014 was
$8.6 million , compared to a non-GAAP operating loss of$8.9 million for the same period in 2013 - Non-GAAP operating loss for the full year 2014 was
$41.5 million , compared to a non-GAAP operating loss of$17.3 million for the full year 2013 - Cash, cash equivalents and marketable securities as of
December 31, 2014 totaled$27.8 million
"The fourth quarter marked a strong close to 2014," said
Quarter Ended
Net product sales for the fourth quarter of 2014 were
Selling, general and administrative expenses for the fourth quarter of 2014 were
Research and development expenses for the fourth quarter of 2014 were
Net interest and other expense for the fourth quarter of 2014 was
Net loss for the fourth quarter of 2014 was
Year Ended
Net product sales for the full year 2014 were
Selling, general and administrative expenses for the full year 2014 were
Research and development expenses for the full year 2014 were
Net interest and other expense for the full year 2014 was
Net loss for the full year 2014 was
Commercial Product Updates
Thiola® (tiopronin)
- As of
March 2, 2015 , more than 650 patients were receiving Thiola® therapy. - Results of a market research survey recently commissioned by the Company suggest that the potential target market in
the United States could be as much as 4,000 to 5,000 patients, an increase from the previous estimated range of 2,000 to 3,000 patients.
Chenodal® (chenodeoxycholic acid)
Retrophin is in active discussions with theU.S. Food and Drug Administration (FDA) to determine an acceptable pathway for the addition of cerebrotendinous xanthomatosis (CTX) to the Chenodal label. Chenodal has been used as the standard of care for CTX for more than three decades, and the Company believes inclusion on the label would reflect the true nature of its current use.- In the second quarter of 2015,
Retrophin is planning to initiate a screening study in pediatric and adolescent patients with idiopathic bilateral cataracts to determine the frequency of CTX within this population. The study will provide needed data to improve awareness and earlier diagnosis of CTX.
Pipeline Updates
Sparsentan
Retrophin continues to enroll patients in the Phase II DUET study of sparsentan for the treatment of focal segmental glomerulosclerosis (FSGS). The Company anticipates meeting the target enrollment of 100 patients by year end 2015.- The first Data Monitoring Committee meeting took place in
November 2014 and allowed study continuation, as well as the initiation of pediatric enrollment. - In
January 2015 , theU.S. FDA Office of Orphan Products Development granted sparsentan orphan drug designation for the treatment of FSGS.
RE-024
Retrophin intends to file a U.S. IND in the first half of 2015 to support a Phase I study of RE-024 in healthy volunteers.- Two additional ex-U.S. pantothenate kinase-associated neurodegeneration (PKAN) patients began RE-024 treatment in the fourth quarter of 2014 and are currently receiving treatment with RE-024 under a physician-initiated protocol. The first two PKAN patients previously disclosed to have initiated RE-024 treatment also continue to receive therapy. All four PKAN patients are currently being treated with RE-024 in accordance with local laws and regulations in their respective countries. The release of patient data via peer-reviewed publications and scientific meetings is at the discretion of each treating physician.
RE-034
Retrophin has successfully formulated and manufactured RE-034 using a novel formulation process which allows modulation of the release of active ingredient from the site of administration. In early 2015 the Company filed for a provisional patent covering our novel formulation.Retrophin continues preclinical development of RE-034 to enable multiple strategic options.
Non-core assets
Retrophin closed the previously announced sale of non-core assets ketamine, Syntocinon Nasal Spray® (oxytocin), and Vecamyl® (mecamylamine HCI tablets) originally announced onOctober 14, 2014 .
Conference Call Information
Use of Non-GAAP Financial Measures
To supplement Retrophin's financial results and guidance presented in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses certain non-GAAP adjusted financial measures in this press release and the accompanying tables. The Company believes that these non-GAAP financial measures are helpful in understanding its past financial performance and potential future results. They are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read in conjunction with the consolidated financial statements prepared in accordance with GAAP. Retrophin's management regularly uses these supplemental non-GAAP financial measures internally to understand, manage and evaluate its business and make operating decisions. In addition,
Investors should note that these non-GAAP financial measures are not prepared under any comprehensive set of accounting rules or principles and do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP. Investors should also note that these non-GAAP financial measures have no standardized meaning prescribed by GAAP and, therefore, have limits in their usefulness to investors. In addition, from time to time in the future the Company may exclude other items, or cease to exclude items that it has historically excluded, for purposes of its non-GAAP financial measures; Because of the non-standardized definitions, the non-GAAP financial measures as used by the Company in this press release and the accompanying tables may be calculated differently from, and therefore may not be directly comparable to, similarly titled measures used by the Company's competitors and other companies.
As used in this press release, (i) the historical non-GAAP net income (loss) measures exclude from GAAP net income (loss), as applicable, intangible asset amortization, stock-based compensation expense, executive severance charges, transaction and license fees, change in fair value of derivative liabilities, depreciation expense, non-cash interest and finance expenses; adjust the income tax provision to the estimated amount of taxes that are payable in cash; (ii) the historical non-GAAP SG&A expense measures exclude from GAAP SG&A expenses, as applicable, intangible asset amortization, stock-based compensation expense, executive severance charges, transaction and license fees, legal fee and settlements, and depreciation expense; (iii) the historical non-GAAP R&D expense measures exclude from GAAP R&D expenses, as applicable, intangible asset amortization, stock-based compensation expense, transaction and license fees and depreciation expense.
About
Forward-Looking Statements
This press release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995, regarding the research, development and commercialization of pharmaceutical products. Without limiting the foregoing, these statements are often identified by the words "may", "might", "believes", "thinks", "anticipates", "plans", "expects", "intends" or similar expressions. In addition, expressions of our strategies, intentions or plans are also forward-looking statements. Such forward-looking statements are based on current expectations and involve inherent risks and uncertainties, including factors that could delay, divert or change any of them, and could cause actual outcomes and results to differ materially from current expectations. No forward-looking statement can be guaranteed. Among the factors that could cause actual results to differ materially from those indicated in the forward-looking statements are risks and uncertainties associated with the Company's business and finances in general, as well as risks and uncertainties associated with the Company's pre-clinical and clinical stage pipeline as well as its sales and marketing strategies. Specifically, the risks and uncertainties the Company faces with respect to its pre-clinical and clinical stage pipeline include risk that the Company's research programs will not identify pre-clinical candidates for further development and risk that the Company's clinical candidates will not be found to be safe or effective. Specifically, the Company faces risk that the sparsentan Phase II clinical trials will fail to demonstrate that sparsentan is safe or effective; risk that the sparsentan Phase II program will be delayed for regulatory or other reasons; risk that the Company will be unable to file an IND for RE-024 or RE-034 or initiate Phase I clinical trials for regulatory or other reasons. The Company faces risk that it will be unable to raise additional funding required to complete development of any or all of its product candidates; risk relating to the Company's dependence on contractors for clinical drug supply and commercial manufacturing; uncertainties relating to patent protection and intellectual property rights of third parties; risks and uncertainties relating to competitive products and technological changes that may limit demand for the Company's products. You are cautioned not to place undue reliance on these forward-looking statements as there are important factors that could cause actual results to differ materially from those in forward-looking statements, many of which are beyond our control. The Company undertakes no obligation to publicly update forward-looking statement, whether as a result of new information, future events, or otherwise. Investors are referred to the full discussion of risks and uncertainties as included in the Company's filings with the
| CONSOLIDATED BALANCE SHEETS | ||||||||
| (Unaudited) | ||||||||
|
2014 |
2013 (restated) |
|||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash | $ | 18,204,282 | $ | 5,997,307 | ||||
| Marketable securities | 9,556,098 | 132,994 | ||||||
| Accounts receivable, net | 7,959,411 | - | ||||||
| Inventory, net | 800,507 | - | ||||||
| Prepaid expenses and other current assets | 813,364 | 1,370,943 | ||||||
| Total current assets | 37,333,662 | 7,501,244 | ||||||
| Property and equipment, net | 670,796 | 127,427 | ||||||
| Security deposits | 337,014 | 244,058 | ||||||
| Restricted cash | 40,000 | 40,000 | ||||||
| Other asset | 1,888,035 | - | ||||||
| Intangible assets, net | 94,265,530 | 12,586,150 | ||||||
| Goodwill | 935,935 | - | ||||||
| Total assets | $ | 135,470,972 | $ | 20,498,879 | ||||
| Liabilities and Stockholders' Deficit | ||||||||
| Current liabilities: | ||||||||
| Deferred technology purchase liability | $ | 1,000,000 | $ | 1,634,630 | ||||
| Accounts payable | 7,124,330 | 3,553,567 | ||||||
| Accrued expenses | 27,882,995 | 4,881,434 | ||||||
| Securities sold, not yet purchased | - | 1,457,901 | ||||||
| Other liability | 938,209 | - | ||||||
| Acquisition-related contingent consideration | 2,117,565 | - | ||||||
| Derivative financial instruments, warrants | 27,990,000 | 25,037,346 | ||||||
| Note payable | 40,485,452 | - | ||||||
| Total current liabilities | 107,538,551 | 36,564,878 | ||||||
| Convertible debt | 43,287,814 | - | ||||||
| Other liability | 12,234,513 | - | ||||||
| Acquisition-related contingent consideration, less current portion | 9,519,662 | - | ||||||
| Deferred technology purchase liability, less current portion | - | 1,000,000 | ||||||
| Deferred income tax liability, net | 141,151 | 2,600,899 | ||||||
| Total liabilities | 172,721,691 | 40,165,777 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' Deficit: | ||||||||
| Preferred stock Series A |
- | - | ||||||
| Common stock |
2,692 | 1,855 | ||||||
| Additional paid-in capital | 140,850,502 | 49,635,502 | ||||||
| Treasury stock, at cost, 379,591 and 130,790, respectively | (3,214,608 | ) | (957,272 | ) | ||||
| Accumulated deficit | (179,174,858 | ) | (68,236,996 | ) | ||||
| Accumulated other comprehensive income (loss) | 4,285,553 | (109,987 | ) | |||||
| Total stockholders' deficit | (37,250,719 | ) | (19,666,898 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 135,470,972 | $ | 20,498,879 | ||||
| CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||||||||||||||||
| (unaudited) | ||||||||||||||||
| Three months ended | Twelve months ended | |||||||||||||||
| 2014 | 2013 (restated) | 2014 | 2013 (restated) | |||||||||||||
| Net product sales | $ | 14,084,988 | $ | - | $ | 28,203,205 | $ | - | ||||||||
| Operating expenses: | ||||||||||||||||
| Cost of goods sold | (834,727 | ) | - | 570,979 | - | |||||||||||
| Research and development | 14,896,492 | 5,684,134 | 47,795,223 | 7,084,009 | ||||||||||||
| Selling, general and administrative | 18,720,283 | 6,188,067 | 59,644,696 | 17,689,439 | ||||||||||||
| Total operating expenses | 32,782,048 | 11,872,201 | 108,010,898 | 24,773,448 | ||||||||||||
| OPERATING LOSS | (18,697,060 | ) | (11,872,201 | ) | (79,807,693 | ) | (24,773,448 | ) | ||||||||
| OTHER INCOME (EXPENSE): | ||||||||||||||||
| Interest income/(expense), net | (2,627,376 | ) | (4,790 | ) | (7,434,878 | ) | (46,344 | ) | ||||||||
| Finance expense | - | (4,720,780 | ) | |||||||||||||
| Realized gain on sales of marketable securities, net | 1,805,646 | 314,745 | 2,349,430 | 374,482 | ||||||||||||
| Change in fair value of derivative instruments-gain/(loss) | (9,510,000 | ) | (1,184,254 | ) | (23,786,072 | ) | (10,099,926 | ) | ||||||||
| Gain/(loss) on transactions denomimated in foreign currency | 1,630 | - | 2,383 | (3,873 | ) | |||||||||||
| Total other expense, net | (10,330,100 | ) | (874,299 | ) | (33,589,917 | ) | (9,775,661 | ) | ||||||||
| LOSS BEFORE INCOME TAXES | (29,027,160 | ) | (12,746,500 | ) | (113,397,610 | ) | (34,549,109 | ) | ||||||||
| Income tax benefit (provision) | - | (75,775 | ) | 2,459,748 | (75,775 | ) | ||||||||||
| NET LOSS | $ | (29,027,160 | ) | $ | (12,822,275 | ) | $ | (110,937,862 | ) | $ | (34,624,884 | ) | ||||
| PER SHARE DATA: | ||||||||||||||||
| Net loss per common share, basic | (1.10 | ) | (0.70 | ) | (4.43 | ) | (2.44 | ) | ||||||||
| Net loss per common share, diluted | (1.10 | ) | (0.70 | ) | (4.43 | ) | (2.44 | ) | ||||||||
| Weighted average common shares outstanding, basic | 26,318,863 | 18,382,015 | 25,057,509 | 14,205,264 | ||||||||||||
| Weighted average common shares outstanding, diluted | 26,318,863 | 18,382,015 | 25,057,509 | 14,205,264 | ||||||||||||
| Comprehensive Loss: | ||||||||||||||||
| Net loss | $ | (29,027,160 | ) | $ | (12,822,275 | ) | $ | (110,937,862 | ) | $ | (34,624,884 | ) | ||||
| Unrealized gain | 644,441 | 44,847 | 4,395,540 | (109,987 | ) | |||||||||||
| Comprehensive Loss | $ | (28,382,719 | ) | $ | (12,777,428 | ) | $ | (106,542,322 | ) | $ | (34,734,871 | ) | ||||
| RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION | ||||||||||||||||
| Three Months Ended |
Twelve Months Ended |
|||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| GAAP OPERATING LOSS | $ | (18,697,060 | ) | $ | (11,872,201 | ) | $ | (79,807,693 | ) | $ | (24,773,448 | ) | ||||
| R&D Operating Expense | $ | (14,896,492 | ) | $ | (5,684,134 | ) | $ | (47,795,223 | ) | $ | (7,084,009 | ) | ||||
| Stock Compensation | 1,681,949 | 149,505 | 4,960,063 | 259,076 | ||||||||||||
| Transaction & license fees | 603,760 | - | 3,337,920 | - | ||||||||||||
| Amortization & Depreciation | 260,539 | 51,066 | 826,464 | 202,597 | ||||||||||||
| Subtotal non-GAAP items | 2,546,248 | 200,571 | 9,124,447 | 461,673 | ||||||||||||
| NON -GAAP R&D EXPENSE | (12,350,244 | ) | (5,483,563 | ) | (38,670,776 | ) | (6,622,336 | ) | ||||||||
| SG&A Operating Expense | (18,720,283 | ) | (6,188,067 | ) | (59,644,696 | ) | (17,689,439 | ) | ||||||||
| Legal Expense (A) | 1,400,000 | - | 5,400,000 | - | ||||||||||||
| Executive severance (A) | 977,000 | - | 5,616,000 | - | ||||||||||||
| Settlements (A) | 2,157,579 | 350,087 | 2,484,787 | 2,584,511 | ||||||||||||
| Stock Compensation | 1,301,567 | 2,464,287 | 10,940,393 | 4,384,220 | ||||||||||||
| Amortization & Depreciation | 1,737,681 | 5,800 | 4,714,565 | 13,396 | ||||||||||||
| Subtotal non-GAAP items | 7,573,827 | 2,820,174 | 29,155,745 | 6,982,127 | ||||||||||||
| NON -GAAP SG&A EXPENSE | (11,146,456 | ) | (3,367,893 | ) | (30,488,951 | ) | (10,707,312 | ) | ||||||||
| Subtotal non-GAAP items | 10,120,075 | 3,020,745 | 38,280,192 | 7,443,800 | ||||||||||||
| NON -GAAP OPERATING LOSS | (8,576,985 | ) | (8,851,456 | ) | (41,527,501 | ) | (17,329,648 | ) | ||||||||
| GAAP NET LOSS | (29,027,160 | ) | (12,822,275 | ) | (110,937,862 | ) | (34,624,884 | ) | ||||||||
| Non-GAAP Operating Loss Adjustments | 10,120,075 | 3,020,745 | 38,280,192 | 7,443,800 | ||||||||||||
| Finance Expense | - | - | 4,720,780 | - | ||||||||||||
| Change in fair value of derivative instruments-(gain)/loss | 9,510,000 | 1,184,254 | 23,786,072 | 10,099,926 | ||||||||||||
| Income Tax (benefit)/provision | - | 75,775 | (2,459,748 | ) | 75,775 | |||||||||||
| NON-GAAP NET LOSS | $ | (9,397,085 | ) | $ | (8,541,501 | ) | $ | (46,610,566 | ) | $ | (17,005,383 | ) | ||||
| PER SHARE DATA: | ||||||||||||||||
| Net loss per common share, basic | (0.36 | ) | (0.46 | ) | (1.86 | ) | (1.20 | ) | ||||||||
| Net loss per common share, diluted | (0.36 | ) | (0.46 | ) | (1.86 | ) | (1.20 | ) | ||||||||
| Weighted average common shares outstanding, basic | 26,318,863 | 18,382,015 | 25,057,509 | 14,205,264 | ||||||||||||
| Weighted average common shares outstanding, diluted | 26,318,863 | 18,382,015 | 25,057,509 | 14,205,264 | ||||||||||||
| (A) One time, non-recurring items | ||||||||||||||||
Manager, Investor Relations
IR@retrophin.com
Source:
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