Intec Pharma Ltd. Reports 2015 Fourth Quarter And Full-Year Financial Results
JERUSALEM, ISRAEL--(Marketwired - March 14, 2016) - Intec Pharma Ltd. (NASDAQ: NTEC) (TASE: INTP), an Israeli clinical stage biopharmaceutical company focused on developing drugs based on its proprietary Accordion Pill platform technology, today announced its financial results for the year ended December 31, 2015 and provided a business update. Results are presented in New Israel Shekels (NIS) with a convenience translation to US Dollars ($) provided using the Bank of Israel exchange rate of NIS 3.902 to $1.00 at December 31, 2015.
Financial highlights for the year ended December 31, 2015 and for the fourth quarter of 2015
- Research and Development Expenses, net for the quarter ended December 31, 2015 were approximately NIS 7.9 million ($2 million), compared to NIS 3.3 million in the comparable quarter of 2014. Research and development expenses, net, for the year ended December 31, 2015 were approximately NIS 18.7 million ($4.8 million), compared to NIS 12.2 million for the year ended December 31, 2014. The increase in both periods resulted primarily from an increase in expenses related to preparation for our Phase III clinical trial for our lead product, the Accordion Pill Carbidopa/Levodopa, or AP-CDLD, for the treatment of Parkinson's disease symptoms in advanced Parkinson's disease patients, payroll and related expenses and other expenses associated with our Phase III clinical trial for AP-CDLD, which were partially offset by increases in research and development-related grants and participation in research and development expenses from the Office of the Chief Scientist of the Israeli Ministry of Economy received in 2015 compared to 2014.
- General and Administrative Expenses for the quarter ended December 31, 2015 were approximately NIS 3.4 million ($871,000), compared to NIS 2.4 million in the comparable quarter of 2014. General and administrative expenses for the year ended December 31, 2015 were approximately NIS 10.8 million ($2.8 million) compared to NIS 9.3 million for the year ended December 31, 2014. The increase in both periods resulted primarily due to an increase in professional services, payroll and related expenses and other expenses associated with being a public company in the United States since August 2015.
- Financial Income, net for the year ended December 31, 2015 was approximately NIS 1.6 million ($402,000) compared to approximately NIS 324,000 for the year ended December 31, 2014. The increase resulted primarily due from increase in foreign currency exchange, which was partially offset by a decrease in financial income from interest on cash equivalents and short term bank deposits.
- Loss and Comprehensive Loss for the year ended December 31, 2015 was NIS 27.9 million ($7.1 million) or NIS 3.58 ($0.92) per share, based on 7.8 million basic and diluted shares, compared with a loss and comprehensive loss of NIS 20.4 million or NIS 4.22 per share, based on 4.8 million basic and diluted shares, for the year ended December 31, 2014.
- Net Cash Used in Operating Activities for the year ended December 31, 2015 was approximately NIS 30.8 million ($7.9 million) compared to approximately NIS 17 million in the year ended December 31, 2014. This increase primarily resulted from an increase in our loss and comprehensive loss of approximately NIS 7.5 million and an increase in changes in operating asset and liability items of approximately NIS 6.3 million.
- Net Cash Used in Investment Activities for the year ended December 31, 2015 was approximately NIS 24.8 million ($6.4 million), compared to approximately NIS 9.7 million of net cash provided by investment activities for the year ended December 31, 2014. The change primarily resulted from an increase in the purchase of property and equipment in the amount of approximately NIS 5.4 million and from investment in a short-term bank deposit in the amount of approximately NIS 19.4 million.
- Net Cash Provided by Financing Activities for the year ended December 31, 2015 was approximately NIS 124.1 million ($31.8 million) compared to approximately NIS 17.2 million for the year ended December 31, 2014. The positive cash flow from financing activities for the year ended December 31, 2015 was primarily due to proceeds from our initial public offering in the United States in the amount of approximately NIS 116.8 million.
- Cash, cash equivalents, short term bank deposits and financial assets at fair value as of December 31, 2015 were approximately NIS 119.7 million (approximately $30.7 million) as compared to approximately NIS 30.1 million as of December 31, 2014.
Zeev Weiss, CEO of Intec Pharma, said:
"2015 was an exciting year for Intec Pharma. During the year we addressed a number of very important milestones related to our platform technology, the Accordion Pill, as well as to our leading product candidate, AP-CDLD.
With respect to AP-CDLD, in May 2015 we agreed with the FDA on the remaining clinical development program for AP-CDLD for the treatment of Parkinson's disease symptoms in advanced Parkinson's disease patients, including the main principles of the single required pivotal Phase III clinical trial in advanced Parkinson's disease patients, under the 505(b) (2) regulatory pathway. In December 2015, we received a U.S. centralized IRB approval to initiate a Phase III clinical trial of AP-CDLD.
With respect to the Accordion Pill technology, we significantly enhanced the manufacturing capabilities of Accordion Pills by completing the installation of a fully automated assembly line in September 2015. We have also expanded the IP protection of our technology with the grant of several important patents. In 2015, we also entered into an exciting collaboration agreement with Biogen and, in addition, we initiated a Phase I clinical trial with our third pipeline product, which is being developed for the prevention and treatment of gastroduodenal and small bowel NSAID induced ulcers.
In addition to the very important clinical, development and regulatory milestones that we achieved in 2015, this year was exciting for Intec Pharma, as we became a public company traded on NASDAQ after we successfully completed our US IPO, raising net proceeds of approximately $30 million.
We look forward to continuing the achievement of major milestones in 2016."
Recent highlights
- On March 10, 2016, we announced that we completed a Phase I clinical trial of our third pipeline product, which is being developed for the prevention and treatment of gastroduodenal and small bowel Nonsteroidal Anti-Inflammatory Drug (NSAID) induced ulcers and is based on a new Accordion Pill formulation with an existing drug. The Pharmacokinetics (PK) results demonstrated in this Phase I trial were within the well-defined safety levels of the drug, which enable us to proceed with further development of the Accordion Pill with the existing drug.
- On December 23, 2015, the European Patent Office (EPO) granted a European patent on our European Patent Application for a "Zaleplon gastroretentive drug delivery system." The patent, number EP 237883, protects one of our product candidates, Accordion Pill Zaleplon, which is being developed for the indication of treatment of insomnia, including sleep induction and the improvement of sleep maintenance. The patent is currently scheduled to remain in force until October 19, 2029.
- On December 14, 2015, we announced that we received a US centralized institutional review board (IRB) approval to initiate our Phase III clinical trial for our lead product, AP-CDLD for the treatment of Parkinson's disease symptoms in advanced Parkinson's disease patients. Approximately 460 patients will be enrolled in this single pivotal Phase III study in advanced Parkinson's disease patients. The total treatment period for each patient will be 25 weeks. The primary efficacy endpoint will be a change from baseline to termination of treatment in the percent of daily off time during waking hours.
- On November 4, 2015, the European Patent Office (EPO) be granted our European Patent Application for a "Method and Apparatus for Forming Delivery Devices for Oral Intake of an Agent". The patent, number EP 1981465, protects a method of producing our Accordion Pill platform, and the Accordion Pill produced thereby. The platform may be made from any suitable substances, and is intended for oral delivery of any pharmaceutically active agent of interest. The patent is currently scheduled to remain in force until January 18, 2027.
- On October 12, 2015, we announced topline results of a Food Effect PK study of AP-CDLD 50/500mg for the treatment of Parkinson's disease symptoms. The results demonstrated that plasma concentrations of carbidopa and levodopa were similar, with no statistically significant differences in all PK parameters measured, when AP-CDLD was taken with various food compositions. This suggests that the treatment with AP-CDLD, intended to be taken b.i.d (two times a day) or t.i.d (three times a day) with food, is independent of the food content.
- On August 9, 2015, we closed an underwritten public offering in the U.S. of 5,025,000 ordinary shares at a price to the public of $6.00 per share. We received proceeds from the public offering of approximately $26.5 million, net of commissions to the underwriters and offering expenses. On September 17, 2015, the underwriters partially exercised their overallotment option and purchased an additional 638,750 ordinary shares at a price to the public of $6 per share. We received proceeds of approximately $3.48 million related to the overallotment exercise, net of commissions to the underwriters and offering expenses, bringing the total net proceeds to us from the initial public offering to approximately $30 million. Maxim Group LLC and Roth Capital Partners acted as joint book-running managers for the offering.
INTEC PHARMA LTD.
STATEMENTS OF FINANCIAL POSITION
Convenience
translation
December 31 into USD
-------------------------- ------------
December 31,
2014 2015 2015
------------ ------------ ------------
NIS in thousands In thousands
-------------------------- ------------
Assets
CURRENT ASSETS:
Cash and cash equivalents 22,287 92,277 23,649
Short-term bank deposits 19,510 5,000
Financial assets at fair value
through profit or loss 7,820 7,897 2,024
Restricted bank deposits 292 240 62
Other receivables 1,120 9,211 2,361
------------ ------------ ------------
31,519 129,135 33,096
------------ ------------ ------------
NON-CURRENT ASSETS -
Property and equipment 17,101 15,906 4,076
------------ ------------ ------------
TOTAL ASSETS 48,620 145,041 37,172
============ ============ ============
Liabilities and equity
CURRENT LIABILITIES -
Accounts payable and accruals:
Trade 716 2,394 614
Other 6,503 2,731 701
------------ ------------ ------------
7,219 5,125 1,315
------------ ------------ ------------
NON-CURRENT LIABILITIES -
Derivative financial instruments 4,528 1,277 327
------------ ------------ ------------
COMMITMENTS AND CONTINGENT
LIABILITIES
------------ ------------ ------------
TOTAL LIABILITIES 11,747 6,402 1,642
------------ ------------ ------------
EQUITY:
Ordinary shares 2,701 2,701 692
Share premium 198,566 328,985 84,312
Warrants 2,249 - -
Accumulated deficit (166,643) (193,047) (49,474)
------------ ------------ ------------
TOTAL EQUITY 36,873 138,639 35,530
------------ ------------ ------------
TOTAL LIABILITIES AND EQUITY 48,620 145,041 37,172
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STATEMENT OF COMPREHENSIVE LOSS
Convenience
translation
Year ended December 31 into USD
---------------------------------------- ------------
December 31,
2013 2014 2015 2015
------------ ------------ ------------ ------------
NIS in thousands In thousands
---------------------------------------- ------------
RESEARCH AND
DEVELOPMENT
EXPENSES (17,410) (17,740) (29,257) (7,498)
LESS- PARTICIPATION
IN RESEARCH AND
DEVELOPMENT
EXPENSES 8,393 5,544 10,556 2,705
------------ ------------ ------------ ------------
RESEARCH AND
DEVELOPMENT
EXPENSES, net (9,017) (12,196) (18,701) (4,793)
GENERAL AND
ADMINISTRATIVE
EXPENSES (9,633) (9,332) (10,828) (2,775)
OTHER GAINS, net 474 836 76 19
------------ ------------ ------------ ------------
OPERATING LOSS (18,176) (20,692) (29,453) (7,549)
FINANCIAL INCOME 434 1,136 2,458 630
FINANCIAL EXPENSES (648) (812) (889) (228)
------------ ------------ ------------ ------------
FINANCIAL INCOME
(EXPENSES), net (214) 324 1,569 402
------------ ------------ ------------ ------------
LOSS AND
COMPREHENSIVE LOSS (18,390) (20,368) (27,884) (7,147)
============ ============ ============ ============
NIS USD
---------------------------------------- ------------
BASIC AND DILUTED
LOSS PER ORDINARY
SHARE (4.25) (4.22) (3.58) (0.92)
============ ============ ============ ============
STATEMENTS OF CASH FLOWS
Convenience
translation
Year ended December 31 into USD
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December 31,
2013 2014 2015 2015
------------ ------------ ------------ ------------
NIS in thousands In thousands
---------------------------------------- ------------
CASH FLOWS FROM
OPERATING
ACTIVITIES:
Loss for the year (18,390) (20,368) (27,884) (7,147)
Adjustments to
reconcile loss
and comprehensive
loss to net cash
provided from
operations:
Depreciation 2,176 2,092 2,898 743
Exchange
differences on
restricted
deposits (6) (1) 3 *
Changes in the
fair value of
derivative
financial
instruments (32) 729 829 212
Exchange
differences on
cash and cash
equivalents 223 (535) (1,478) (379)
Exchange
differences on
short-term bank
deposit (85) (22)
Losses (gains)
on financial
assets at fair
value through
profit or loss (474) 51 (76) (19)
Share-based
compensation to
investors 88 - - -
Share-based
compensation to
employees and
service
providers 1,829 1,207 1,480 379
Changes in
operating asset
and liability
items:
Decrease
(increase) in
other
receivables 871 1,463 (8,091) (2,073)
Increase
(decrease) in
accounts
payable and
accruals 1,497 (1,635) 1,608 413
------------ ------------ ------------ ------------
Net cash used in
operating
activities (12,218) (16,997) (30,796) (7,893)
------------ ------------ ------------ ------------
CASH FLOWS FROM
INVESTING
ACTIVITIES:
Purchase of
property and
equipment (5,376) (271) (5,405) (1,385)
Investments in
short-term
deposits - - (19,425) (4,978)
Proceeds from
disposal
(purchase) of
financial assets
at fair value
through profit or
loss, net (5,955) 10,016 (1) *
Changes in
restricted bank
deposits, net 76 (31) 49 12
------------ ------------ ------------ ------------
Net cash provided
by (used in)
investing
activities (11,255) 9,714 (24,782) (6,351)
CASH FLOWS FROM
FINANCING
ACTIVITIES:
Issuance of shares
through public
offering, net of
issuance costs - - 116,780 29,928
Exercise of
warrants (series
7) - - 7,310 1,874
Exercise of
warrants (series
3) 251 - - -
Exercise of
options by
employees and
service providers 548 579 * *
Issuance of shares
and warrants as
part of an
investment
agreement, net of
issuance costs 17,692 - - -
Issuance of shares
as part of an
addendum to the
investment
agreement - 101 - -
Issuance of shares
and warrants, net
of issuance costs 15,015 16,592 - -
------------ ------------ ------------ ------------
Net cash provided
by financing
activities 33,506 17,272 124,090 31,802
------------ ------------ ------------ ------------
INCREASE IN CASH AND
CASH EQUIVALENTS 10,033 9,989 68,512 17,558
CASH AND CASH
EQUIVALENTS -
BEGINNING OF YEAR 1,953 11,763 22,287 5,712
EXCHANGE DIFFERENCES
ON CASH AND CASH
EQUIVALENTS (223) 535 1,478 379
------------ ------------ ------------ ------------
CASH AND CASH
EQUIVALENTS - END
OF YEAR 11,763 22,287 92,277 23,649
============ ============ ============ ============
Information
regarding
investment and
financing
activities not
involving cash
flows:
Liability with
respect to
property
purchase order 3,931
============
Settlement of
liability in
respect to
derivative
financial
instrument to
equity 6,499 4,080 1,046
============ ============ ============
Supplementary
information to
the statement of
cash flows -
Interest
received 402 617 171 44
============ ============ ============ ============