Galmed Pharmaceuticals Reports Third Quarter 2017 Financial Results and Provides Business Update
TEL AVIV, Israel, Nov. 9, 2017 /PRNewswire/ -- Galmed Pharmaceuticals Ltd. (Nasdaq: GLMD) ("Galmed" or the "Company"), a clinical-stage biopharmaceutical company focused on the development of a once-daily, oral therapy for the treatment of nonalcoholic steatohepatitis, or NASH, and other liver diseases, today reported financial results for the three and nine months ended September 30, 2017. The Company will host a conference call and webcast today to discuss the financial results and to provide an update on current developments with respect to its clinical programs for Aramchol(TM).
Business Update
-- Galmed announced the publication of a paper entitled "Role of
Aramchol(TM) in steatohepatitis and fibrosis in mice" in Hepatology
Communications, a peer-reviewed, online journal. This paper summarizes
the work conducted by a collaboration of key international basic and
clinical scientists, who are well known NASH experts. The data help to
understand the mechanism by which Aramchol exerts its effect on
steatosis and steato-fibrosis and identify its potential direct
anti-fibrotic effect. A poster of the data was presented at the
American Association for the Study of Liver Diseases (AASLD) Liver
Meeting on October 20-24, 2017 in Washington, D.C.
-- During the third quarter, the Company raised net proceeds of
approximately $2.7 million in a registered direct offering to existing
investors and a concurrent private placement to Galmed's Chairman of the
Board and an additional board member. Both offerings were completed at
$7.10 per share.
-- As of the beginning of November, 2017, all patients have been randomized
in the ARRIVE study. ARRIVE is a proof-of-concept clinical trial that is
evaluating the safety and efficacy of Aramchol in 50 patients with
HIV-associated lipodystrophy and nonalcoholic fatty liver disease, or
NAFLD. ARRIVE is a randomized, double-blinded, placebo-controlled,
proof-of-concept Phase IIa clinical trial, comparing Aramchol at 600 mg
versus placebo over 12 weeks. It is an investigator-initiated study
being conducted by Professor Rohit Loomba at the NAFLD Research Center,
at the University of California San Diego. The primary end point is
improvement in hepatic steatosis as measured by MRI. Secondary endpoints
measure improvements in total body fat, metabolic profile, and liver
biochemistry. Release of topline data is expected in the first quarter
of 2018.
"We are pleased with our continued progress on both our ARRIVE and ARREST clinical trials, which we anticipate will report our topline data in the first and second quarters of 2018, respectively," said Allen Baharaff, President and Chief Executive Officer of Galmed. Mr. Baharaff continued, "Moreover, we strengthened our balance sheet with the support of institutional investors, along with two members of our board."
Financial Summary - Third Quarter 2017 vs. Third Quarter 2016:
-- Net loss of $2.8 million, or $0.23 per share, for the three months ended
September 30, 2017, compared to a net loss of $3.8 million, or $0.34 per
share, for the three months ended September 30, 2016. This period's net
loss included $0.4 million of non-cash, stock-based compensation
expense, versus $0.2 million of non-cash stock-based compensation
expense incurred during the corresponding period in 2016.
-- The Company recognized $0.3 million of revenue for the three months
ended September 30, 2017, compared to $0.2 million revenue for the three
months ended September 30, 2016. The revenue relates to the amortization
of the up-front payments under the license agreement with Samil Pharm.
-- Research and development ("R&D") expenses amounted to approximately $2.3
million for the three months ended September 30, 2017, compared to
approximately $3.3 million for the three months ended September 30,
2016. The decrease resulted primarily from a decrease in expenses in
connection with the ARREST study.
-- General and administrative expenses amounted to approximately $0.70
million for the three months ended September 30, 2017, compared to
approximately $0.66 million for the three months ended September 30,
2016. The slight increase in general and administrative expenses for the
three months ended September 30, 2017 resulted primarily from an
increase in professional fees.
-- Financial expenses amounted to $0.05 million for the three months ended
September 30, 2017, compared to financial income of $0.08 million for
the three months ended September 30, 2016. The decrease in financial
income for the three months ended September 30, 2017 resulted primarily
from changes in the foreign currency exchange rate.
-- Cash and cash equivalents and marketable securities totaled $9.0 million
as of September 30, 2017, compared to $15.5 million at December 31,
2016. Subsequent to the balance sheet date, the Company raised net
proceeds of approximately $1.1 million in its "at-the-market" equity
offering program. Galmed believes that its cash balance will be
sufficient to maintain its current operations through 2018.
Conference Call & Webcast:
Thursday, November 9(th) @ 8:30am Eastern Time
Toll-Free: 800-479-9001
Toll/International: 719-457-2639
Conference ID: 9813581
Webcast: http://public.viavid.com/index.php?id=126942
Replays, available through November 23, 2017
Toll-Free: 844-512-2921
Toll/International: 412-317-6671
Replay PIN: 9813581
About Aramchol(TM) and Non-alcoholic Steatohepatitis (NASH)
Aramchol(TM) (arachidyl amido cholanoic acid) is a novel fatty acid bile acid conjugate, inducing beneficial modulation of intra-hepatic lipid metabolism. Aramchol's ability to modulate hepatic lipid metabolism was discovered and validated in animal models, demonstrating downregulation of the three key pathologies of NASH: steatosis, inflammation and fibrosis. The effect of Aramchol(TM) on fibrosis is mediated by downregulation of steatosis and directly on human collagen producing cells. Aramchol(TM) has been granted Fast Track designation status by the FDA for the treatment of NASH.
NASH is an emerging world crisis impacting an estimated 3% to 5% of the U.S. population and an estimated 2% to 4% globally. It is the fastest growing cause of liver cancer and liver transplant in the U.S. due to the rise in obesity. NASH is the progressive form of non-alcoholic fatty liver disease that can lead to cardiovascular disease, cirrhosis and liver-related mortality.
About Galmed Pharmaceuticals Ltd.
Galmed is a clinical-stage biopharmaceutical company focused on the development of Aramchol(TM), a first in class, novel, once-daily, oral therapy for the treatment of NASH for variable populations, as well as other liver associated disorders. Galmed is currently conducting the ARREST Study, a multicenter, randomized, double blind, placebo-controlled Phase IIb clinical study designed to evaluate the efficacy and safety of Aramchol(TM) in subjects with NASH, who are overweight or obese, and who are pre-diabetic or type-II-diabetic. Galmed also sponsors the ARRIVE Study, a proof-of-concept Phase IIa clinical trial designed to evaluate the safety and efficacy of Aramchol(TM) in 50 patients with HIV-associated NAFLD and lipodystrophy. The ARRIVE Study is an investigator-initiated trial, conducted at the University of California San Diego by Professor Rohit Loomba. More information about the ARREST Study and the ARRIVE Study may be found on ClinicalTrials.gov identifiers: NCT02279524 and NCT02684591, respectively.
Forward-Looking Statements:
This press release may include forward-looking statements. Forward-looking statements may include, but are not limited to, statements relating to Galmed's objectives, plans and strategies, as well as statements, other than historical facts, that address activities, events or developments that Galmed intends, expects, projects, believes or anticipates will or may occur in the future. These statements are often characterized by terminology such as "believes," "hopes," "may," "anticipates," "should," "intends," "plans," "will," "expects," "estimates," "projects," "positioned," "strategy" and similar expressions and are based on assumptions and assessments made in light of management's experience and perception of historical trends, current conditions, expected future developments and other factors believed to be appropriate. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statements. Many factors could cause Galmed's actual activities or results to differ materially from the activities and results anticipated in forward-looking statements, including, but not limited to, the following: the timing and cost of Galmed's ongoing Phase IIb ARREST Study, and planned Phase III trials for Aramchol(TM), or whether Phase III trials will be conducted at all; completion and receiving favorable results of these Phase IIb ARREST Study and Phase III trials for Aramchol(TM); regulatory action with respect to Aramchol(TM) by the FDA or the EMA; the commercial launch and future sales of Aramchol(TM) or any other future products or product candidates; Galmed's ability to comply with all applicable post-market regulatory requirements for Aramchol(TM) in the countries in which it seeks to market the product; Galmed's ability to achieve favorable pricing for Aramchol(TM); Galmed's expectations regarding the commercial market for NASH in patients who are overweight or obese and have pre diabetes or type II diabetes mellitus; third-party payor reimbursement for Aramchol(TM); Galmed's estimates regarding anticipated capital requirements and Galmed's needs for additional financing; market adoption of Aramchol(TM) by physicians and patients; the timing, cost or other aspects of the commercial launch of Aramchol(TM); the development and approval of the use of Aramchol(TM) for additional indications or in combination therapy; and Galmed's expectations regarding licensing, acquisitions and strategic operations. More detailed information about the risks and uncertainties affecting Galmed is contained under the heading "Risk Factors" included in Galmed's most recent Annual Report on Form 20-F filed with the SEC on March 23, 2017, and in other filings that Galmed has made and may make with the SEC in the future. The forward-looking statements contained in this press release are made as of the date of this press release and reflect Galmed's current views with respect to future events, and Galmed does not undertake and specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
GALMED PHARMACEUTICALS LTD.
Consolidated Balance Sheets
---------------------------
U.S. Dollars in thousands, except share data and per share data
As of As of
September 30, December 31,
2017 2016
---- ----
Unaudited Audited
--------- -------
Assets
Current assets
Cash and cash equivalents $2,614 $3,097
Marketable securities 6,344 12,351
Other accounts receivable 171 284
--- ---
Total current assets 9,129 15,732
----- ------
Property and equipment, net 548 718
--- ---
Total assets $9,677 $16,450
====== =======
Liabilities and stockholders' equity
Current liabilities
Trade payables $1,965 $3,122
Other accounts payable 219 363
Short-term portion of deferred revenue 811 1,094
--- -----
Total current liabilities 2,995 4,579
----- -----
Long-term liabilities
Related parties 150 267
Long-term portion of deferred revenue - 529
--- ---
Total long-term liabilities 150 796
--- ---
Stockholders' equity:
Ordinary shares par value NIS 0.01 per share;
Authorized 50,000,000; 36 34
Issued and outstanding: 12,733,512 shares as of
September 30, 2017;
12,149,226 shares as of December 31, 2016
Additional paid-in capital 79,479 75,446
Accumulated other comprehensive loss (8) (85)
Accumulated deficit (72,975) (64,320)
------- -------
Total stockholders' equity 6,532 11,075
----- ------
Total liabilities and stockholders'
equity $9,677 $16,450
====== =======
GALMED PHARMACEUTICALS LTD.
Consolidated Statements of Operations (Unaudited)
------------------------------------------------
U.S. Dollars in thousands, except share data and per share data
Three months ended Nine months ended
September 30, September 30,
------------- -------------
2017 2016 2017 2016
---- ---- ---- ----
Revenue $273 $193 $811 $193
Research and development
expenses 2,331 3,342 7,421 10,086
General and administrative
expenses 697 656 2,110 2,236
--- --- ----- -----
Total operating expenses 2,755 3,805 8,720 12,129
Financial expenses (income),
net 46 (78) (65) (108)
--- --- --- ----
Loss before income taxes 2,801 3,727 8,655 12,021
Taxes on Income - 105 - 106
--- --- --- ---
Net loss $2,801 $3,832 $8,655 $12,127
====== ====== ====== =======
Basic and diluted
net loss per share $0.23 $0.34 $0.71 $1.09
===== ===== ===== =====
Weighted-average number of
shares outstanding 12,364,249 11,150,023 12,274,536 11,101,360
used in computing basic and
diluted net loss per share
GALMED PHARMACEUTICALS LTD.
Consolidated Statements of Cash Flows (Unaudited)
------------------------------------------------
U.S. Dollars in thousands
Nine months ended
September 30,
-------------
2017 2016
---- ----
Cash flow from operating activities
Net loss $(8,655) $(12,127)
Adjustments required to reconcile net loss to
net cash used in operating activities
Depreciation and amortization 180 118
Stock-based compensation expense 1,066 1,307
Amortization of discount/premium on marketable
securities (187) 18
Loss from Realization of marketable securities 130 150
Changes in operating assets and liabilities:
Decrease in other accounts receivable 113 13
Decrease in trade payables (1,157) (556)
Decrease in other accounts payable (144) (173)
Increase (decrease) in related party (117) 45
Increase (decrease) in deferred revenue (812) 1,897
---- -----
Net cash used in operating activities (9,583) (9,305)
------ ------
Cash flow from investing activities
Purchase of property and equipment (10) (26)
Investment in securities, available for sale (1,447) (2,480)
Maturity of securities, available for sale 7,589 9,956
----- -----
Net cash provided in (used in) investing
activities 6,132 7,450
----- -----
Cash flow from financing activities
Proceeds from issuance of stock offerings, net
of issuance costs 2,655 4,479
Proceeds from exercise of options 313 255
--- ---
Net cash used in financing activities 2,968 4,734
----- -----
Increase (decrease) in cash and cash equivalents (483) 2,879
Cash and cash equivalents at the beginning of
the year 3,097 4,156
----- -----
Cash and cash equivalents at the end
of the period $2,614 $7,035
====== ======
Supplemental disclosure of cash flow
information:
Cash received from interest $169 $319
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SOURCE Galmed Pharmaceuticals Ltd.
