Egalet Reports Second Quarter 2015 Financial Results And Provides Business Update

WAYNE, Pa., Aug. 6, 2015 /PRNewswire/ -- Egalet Corporation (Nasdaq: EGLT) ("Egalet"), a fully integrated specialty pharmaceutical company focused on developing, manufacturing and marketing innovative pain treatments, today reported business highlights and financial results for the three months ended June 30, 2015.

Second quarter and recent highlights include:

• Commercial advancements: 
  • Launched 50-person specialty pharmaceutical sales force;
  • Began promoting SPRIX (ketorolac tromethamine) Nasal Spray to target healthcare providers; and
  • Conducted pre-launch activities, including setting up distribution system, to support a third quarter launch of OXAYDO (oxycodone HCI, USP) tablets for oral use only CII.
• Pipeline progress:
  • Demonstrated bioequivalence at the 60 mg dose of abuse-deterrent, extended-release morphine, Egalet-001, to MS Contin (morphine sulfate controlled-release);
  • Met primary endpoint of reduced drug liking of Egalet-001 compared to MS Contin in intranasal human abuse liability study;
  • Announced positive top-line results from oral human abuse liability clinical study of Egalet-002, an abuse-deterrent oxycodone;
  • Demonstrated in Category 1 abuse-deterrent studies Egalet-002's abuse-deterrent properties compared to reformulated OxyContin (oxycodone);
  • Showed in a clinical alcohol interaction study that alcohol dose dumping did not occur with Egalet-002; and
  • Announced issuance of U.S. patents covering Egalet product candidates and Guardian Technology.
• Corporate progress:
  • Completed $61.0 million offering of 5.50% Convertible Senior Notes due 2020;
  • AppointedNicholas Nicolaides, Ph.D. and John Osborn to board of directors and appointedTimothy Walbert chairman of the board of directors; and
  • Closed $86.3 million equity follow-on offering July 31, 2015.

"In the second quarter Egalet transitioned to a fully commercial organization, with the training and launch of our 50-person specialty sales force, promoting of SPRIX® Nasal Spray and preparing for the anticipated third quarter launch of OXAYDO," said Bob Radie, Egalet's president and chief executive officer. "In addition, we completed the clinical and abuse-deterrent studies needed to submit the NDA for Egalet-001 in the fourth quarter of this year, which will represent a significant milestone for the company as this would be our first product fully developed using our proprietary Guardian Technology."

Second Quarter of 2015 Financial Results

• Cash Position: Cash and marketable securities as of June 30, 2015 was $108.4 million compared to $53.9 million as of March 31, 2015. The net increase in cash and marketable securities of $54.5 million in the second quarter 2015, primarily consisted of cash inflows of $56.9 million in net proceeds from the 5.50% Convertible Senior Notes.
• Revenue: Net product sales of SPRIX increased from $607,000 for the three months ended June 30, 2015 from $162,000 for the three months ended March 31, 2015. Related party revenue of $352,000 for the three months ended June 30, 2015 was comprised of the amortization of the deferred revenue related to milestone payments from Shionogi and the performance of certain research and development services performed by Egalet under Egalet's collaboration agreement with Shionogi.
• Costs of Sales: Cost of sales was $207,000 for the three months ended June 30, 2015 attributable entirely to sales of SPRIX which commenced in February 2015.
• G&A Expenses: General and administrative expenses increased to $5.8 million for the three months ended June 30, 2015 compared to $4.5 million for the same period in 2014. This increase was primarily attributable to an increase in employee compensation of $1.0 million and professional fees of $1.1 million as we continue to grow Egalet's U.S. operations. These increases were offset by a decrease in stock compensation expense of $1.1 million.
• S&M Expenses: Sales and marketing expenses of $3.3 million for the three months ended June 30, 2015 were primarily related to the establishment of the commercial operations in the U.S. and launch activities for SPRIX and pre-launch activities for OXAYDO compared to minimal sales and marketing costs in the same period in 2014.
• R&D Expenses: Research and development expenses were $4.9 million for the three months ended June 30, 2015 compared to $7.4 million for the same period in 2014. This decrease was driven primarily by a decrease in Egalet's development costs for Egalet-001 of $1.9 million and a decrease in stock compensation expense of $1.6 million. These decreases were offset by increases in Egalet's development costs for Egalet-002 of $602,000 and an increase in employee compensation and professional fees of $457,000.
• Interest Expense: Interest expense of $2.3 million for the three months ended June 30, 2015 was primarily related to the 5.50% Convertible Senior Notes.
• Net Loss: Net loss increased to $17.1 million, or a loss of $1.03 per share, for the three months ended June 30, 2015 from a net loss of $11.7 million, or a loss of $0.73 per share, for the three months ended June 30, 2014.

Upcoming Milestones:

• Launch OXAYDO in the third quarter;
• Present data at PainWeek in September;
• Submit new drug application for Egalet-001 in the fourth quarter; and
• Select Egalet-003 product candidate by year end.

Conference Call Information
Egalet's management will host a conference call to discuss the second quarter 2015 financial results:

About Egalet
Egalet, a fully integrated specialty pharmaceutical company, is focused on developing, manufacturing and commercializing innovative pain treatments. The Company has two approved products: OXAYDO (oxycodone HCI, USP) tablets for oral use only CII and SPRIX® (ketorolac tromethamine) Nasal Spray. In addition, using Egalet's proprietary Guardian Technology, the Company is developing a pipeline of clinical-stage, opioid-based product candidates that are specifically designed to deter abuse by physical and chemical manipulation. The lead programs, Egalet-001, an abuse-deterrent, extended-release, oral morphine formulation, and Egalet-002, an abuse-deterrent, extended-release, oral oxycodone formulation, are in late-stage clinical development for the management of pain severe enough to require daily, around-the-clock opioid treatment and for which alternative treatments are inadequate. Egalet's Guardian Technology can be applied broadly across different classes of pharmaceutical products and can be used to develop combination products that include multiple active pharmaceutical ingredients with similar or different release profiles. Full additional information on Egalet, please visit www.egalet.com

Please see full prescribing information for OXAYDO at www.oxaydo.com and full prescribing information for SPRIX at www.sprix.com.

Safe Harbor
Statements included in this press release (including but not limited to upcoming milestones) that are not historical in nature are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.

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