Neurosearch A/S – H1 Report 2017
Published: Aug 31, 2017
31 August 2017
Below please find the H1 report 2017. The full report is available in the enclosed PDF file.
The NeuroSearch Group posted an operating loss of DKK 2.3 million in H1 2017 (H1 2016: a loss of DKK 1.4 million).
A loss after tax of continuing operations of DKK 2.5 million was posted in H1 2017 (H1 2016: a loss of DKK 1.7 million).
A consolidated net loss of DKK 2.5 million was posted for H1 2017 (H1 2016: a net loss of DKK 0.5 million).
At 30 June 2017, cash and cash equivalents totalled DKK 66 million (30 June 2016: DKK 77 million). In H1 2017, NeuroSearch paid the DKK 5 million fine for market manipulation.
Update on the Company’s assets.
The Company has shareholdings in:
- NsGene: 26.8% (NsGene entered into voluntary liquidation on 30 January 2017. NeuroSearch has recognised proceeds from the liquidation of DKK 4.5 million in its financial statements for 2016, which the Company expects to receive in Q3 2017).
- Atonomics: 3.6%.
- Potential milestone payments from Teva Pharmaceuticals (if Huntexil® is granted market approval, NeuroSearch will be entitled to receive milestone payments totalling up to DKK 55 million. In 2016, Teva Pharmaceutical Industries Ltd. announced positive data from a comprehensive Phase II study. NeuroSearch has no further insight into Teva’s future plans for developing Huntexil® and is therefore unable to assess the likelihood of payments to NeuroSearch being triggered or the timing of such payments. NeuroSearch has initiated a process to identify any possibilities of divesting the Company’s entitlement to potential milestone payments and potential royalties.).
- Agreements with Saniona A/S. See more below in “Events after the balance sheet date”.
Except for the proceeds deriving from the liquidation of NS Gene, the value of the assets listed above is subject to substantial uncertainty as no established market exists for such assets.
In addition, NeuroSearch calculated the value as of 31 December 2016 of its unrecognised tax losses carried forward at approximately DKK 1,708 million, and deductible temporary differences at approximately DKK 84 million, or a total of approximately DKK 1,791 million. Under certain conditions, the unrecognised tax assets may be utilised in full or in part by a potential buyer of NeuroSearch.
Outlook for 2017
In 2017, NeuroSearch expects an operating loss in the range of DKK 2.3-3.3 million. The outlook does not include any income from the possible divestment of additional Company assets or potential income from the Company’s agreement with Teva.
Events after the balance sheet date
On 4 July 2017, NeuroSearch and Saniona entered into an agreement on transfer of the remaining rights in the preclinical and clinical assets which NeuroSearch divested to Saniona during the period 2012-2016. In full and final settlement of NeuroSearch’s remaining rights in the divested programs, NeuroSearch received from Saniona a one-time cash payment of DKK 5.5 million. Furthermore, Saniona assumed NeuroSearch’s royalty obligations to third parties regarding potential future net sales of products from the programs, including NeuroSearch’s royalty payment obligations to Boehringer Ingelheim (tesofensine) and to GlaxoSmithKline (NS2359).
Of the DKK 5.5 million received, NeuroSearch will, as per the original agreement, pay DKK 0.4 million in total to Boehringer Ingelheim and GlaxoSmithKline. The remaining DKK 5.1 million will add DKK 2.2 million to the Company's operating income, and the DKK 2.9 million will be recognised in discontinued operations.
After receipt of the DKK 5.5 million, the Company’s cash and cash equivalents totalled DKK 71 million. The payment obligation to Boehringer Ingelheim and to GlaxoSmithKline is expected to be fulfilled in H2 2017.
Allan Andersen, CEO, mobile+45 4016 3864