ATHLONE, Ireland -- Innocoll Holdings plc (INNL), a global, specialty pharmaceutical company with late stage development programs targeting areas of significant unmet medical needs, today announced financial and operating results for the three months ended September 30, 2016. Using our proprietary collagen-based technology platform, we manufacture and supply a range of biodegradable and fully bioresorbable pharmaceutical products and medical devices that are precision-engineered for targeted use.
“As we recently announced, Innocoll achieved an exciting, new milestone with the submission of a New Drug Application (NDA) to the U.S. Food and Drug Administration (FDA), for XARACOLL for the treatment of post-surgical pain,” said Tony Zook, Chief Executive Officer of Innocoll. “We anticipate an FDA acceptance of the NDA, for review, by the end of this year, and with a target Prescription Drug User Fee Act (PDUFA) action date in late August 2017, this achievement will take us another step closer to the approval and launch of XARACOLL in potentially less than one year. In preparation, our Saal Germany based manufacturing facility has completed its construction phase, and we are on schedule to undergo pre-approval inspections soon. In addition to progressing XARACOLL, we were also pleased to announce the advancement of COLLAGUARD upon successful demonstration of medical safety in its pre-clinical studies, which cleared the way for our submission of an Investigational Device Exemption (IDE) this month for the prevention of post-surgical adhesions. The COLLAGUARD program is an ideal complement to XARACOLL, which we believe will position Innocoll competitively in the hospital segment. We reported earlier this month that while COGENZIA showed trends of clinical improvement as adjunct treatment of Diabetic Foot Infections (DFIs), the top-line results did not reach statistical significance for the primary endpoint. We will continue to assess all strategic options to bring these much needed new products to the market and the medical community. We plan to manage our cash runway until after the anticipated XARACOLL NDA approval, expected in the third quarter of 2017, and we feel confident about our ability to finance the commercialization of XARACOLL as well as our pipeline”.
Third Quarter 2016 and Recent Highlights
- Submitted an NDA for XARACOLL to the FDA for the treatment of postsurgical pain
- FDA acceptance anticipated by the end of 2016, with a target PDUFA action date in late August 2017.
- Presented supportive pharmacokinetic data at American Society of Anesthesiologists (ASA) Annual Meeting in Chicago, in October.
- Medical publication and presentation of full Phase 3 data are targeted for 2Q 2017. Also under preparation to be published next year are the results of our Health Economics (HECON) study, demonstrating the health economic benefits of using XARACOLL.
- Assessment of strategic options around product development continues, as well the planning and preparation for commercialization has ramped up.
- Advanced COLLAGUARD (INL-003), a collagen film being developed as a medical device implanted at the time of surgery for the prevention of postsurgical adhesions
- Completed pre-clinical studies that demonstrated safety as a surgical adhesion barrier in preclinical studies.
- The positive data support filing of an IDE this quarter, 4Q 2016. Thereafter, a Pilot (Feasibility) Study, for the prevention of post-surgical adhesions in patients undergoing open myomectomy, could be initiated next year, assuming the availability of resources to fund the study.
- Announced that Phase 3 clinical trials for COGENZIA showed trends toward clinical response, but top-line data did not achieve statistical significance in improving clinical cure in DFIs.
- The two COACT Phase 3 clinical trials in patients with moderate to severe DFIs studied COGENZIA administered in conjunction with the standard of care (SOC): systemic antibiotics and wound therapy. Based on top-line data, the COGENZIA plus SOC arm did not meet its primary endpoint of clinical cure of infection after 28 days versus placebo plus SOC or versus SOC alone.
- While Innocoll continues to analyze the results, and there were trends toward clinical response in the COGENZIA and placebo collagen-matrix arms, the top-line data suggests that neither COACT-1 nor COACT-2 achieved statistical significance.
- COGENZIA and the placebo collagen-matrix were well tolerated, and the incidence of overall adverse events was similar across all three treatment arms.
- Continued expansion of Saal manufacturing facilities on schedule with successful completion of key stages
- New Quality Control Laboratories approved and operational.
- On-time completion of the CMC Sections and submission of the XARACOLL NDA to the FDA.
- Construction phase of the commercial manufacturing area completed. Site qualification/validation activities on target for completion prior to year-end.
- Successful completion of a EU “Notified Body” medical device inspection.
- Continuing efforts in preparation for Pre-approval Inspection by FDA. Initial 3rd Party, ex-FDA compliance audit completed.
Third Quarter 2016 Financial Results
Net Loss Attributable to Ordinary Shareholders: Innocoll Holdings plc reported a net loss attributable to its ordinary shares of $17.2 million, or $0.58 per share, for the third quarter of 2016, compared to a loss of $9.1 million, or $0.39 per share, for the third quarter of 2015.
Non-GAAP basic and diluted net loss excluding non-cash expense with respect to share-based compensation and fair value gains and losses on warrants was $15.2 million or $0.51 per share, for the third quarter of 2016, compared to a loss of $12.5 million or $0.53 per share, for the third quarter of 2015.
The weighted average number of ordinary shares outstanding increased from 23.4 million in the third quarter of 2015 to 29.7 million in the third quarter of 2016, primarily as a result of Innocoll's follow-on public offering in the second quarter of 2016. The total number of shares outstanding as at September 30, 2016 was 29.7 million.
Revenues: Revenues were $0.9 million for the third quarter of 2016 compared to $0.7 million in the third quarter of 2015. This increase was primarily due to an increase in sales to EUSA Pharma of CollatampG, our gentamicin implant for the treatment and prevention of post-surgical infection, following the stabilization of the EUSA Pharma business following the transfer from Jazz Pharmaceuticals.
Research and Development (R&D) Expenses: R&D expenses were $8.4 million for the third quarter of 2016 compared to $7.7 million for the third quarter of 2015. R&D expenses in the third quarter of 2016 included $7.5 million in external clinical research expenses, which was primarily driven by our Phase 3 COGENZIA efficacy trials. R&D expenses are expected to decrease significantly in the future as the company concludes the COGENZIA clinical studies and files its NDA for XARACOLL.
General and Administrative (G&A) Expenses: G&A expenses were $7.1 million for the third quarter of 2016 compared to $6.0 million for the third quarter of 2015. Excluding share-based compensation charges, G&A expenses for the third quarter of 2016 were $4.9 million, as compared to $4.2 million for the third quarter of 2015. The increase in G&A, excluding stock-based compensation, was primarily due to our continued infrastructure to support clinical programs and some pre-commercialization investment.
Other Operating (Expense)/Income: Other expense was $0.6 million for the third quarter of 2016 compared to other income of $5.2 million for the third quarter of 2015. Other expense in the third quarter of 2016 consisted primarily of accrued interest on the company’s existing loan with the European Investment Bank (EIB) and foreign exchange losses, partially offset by the fair value income of warrants outstanding. Other income in the third quarter of 2015 consisted primarily of $5.2 million fair value income of investor options outstanding.
Nine Month 2016 Financial Results
Net Loss Attributable to Ordinary Shareholders: Innocoll Holdings plc reported a net loss attributable to its ordinary shareholders of $53.1 million, or $2.05 per share, for the nine months ended September 30, 2016, compared to a loss of $43.1 million, or $1.96 per share, for the nine months ended September 30, 2015.
Non-GAAP basic and diluted loss excluding non-cash expense with respect to share-based compensation and fair value gains and losses on warrants was $51.5 million or $1.99 per share, for the nine months ended September 30, 2016, compared to a loss of $25.6 million, or $1.17 per share, for the nine months September 30, 2015.
The weighted average number of Innocoll ordinary shares outstanding increased from 21.9 million during the nine months ended September 30, 2015, to 25.9 million during the nine months ended September 30, 2016, primarily as a result of Innocoll’s follow-on public offering in the second quarter of 2016. The total number of shares outstanding at September 30, 2016 was 29.7 million.
Revenues: Revenues were $3.8 million for the nine months ended September 30, 2016 compared to $2.0 million for nine months ended September 30, 2015. This increase was primarily due to an increase in sales to EUSA Pharma of CollatampG, our gentamicin implant for the treatment and prevention of post-surgical infection, following the stabilization of the EUSA Pharma business following the transfer from Jazz Pharmaceuticals.
Research and Development (R&D) Expenses: R&D expenses were $34.0 million for the nine months ended September 30, 2016 compared to $18.0 million for the nine months ended September 30, 2015. R&D expenses in the nine months ended September 30, 2016 included $31.1 million in external clinical research expenses, which was primarily due to ramp-up and completion of our Phase 3 XARACOLL efficacy trials and the ramp-up of our Phase 3 COGENZIA efficacy trials. R&D expenses are expected to decrease significantly in the future as the company concludes the COGENZIA clinical studies and files its NDA for XARACOLL.
General and Administrative (G&A) Expenses: G&A expenses were $20.6 million for the nine months ended September 30, 2016 compared to $13.6 million for the nine months ended September 30, 2015. Excluding share-based compensation charges, G&A expenses for the nine months ended September 30 2016 were $14.3 million compared to $10.0 million for the nine months ended September 30, 2015. The increase in G&A, excluding stock-based compensation, was primarily due to $2.2 million of one-off expenses related to the re-domiciliation of the company to Ireland, our continued infrastructure to support clinical programs, and some pre-commercialization investment.
Other Operating Income/(Expense): Other income was $2.9 million for the nine months ended September 30, 2016 compared to an expense of $9.3 million for the nine months ended September 30, 2015. Other income in the nine months ended September 30, 2016 consisted primarily of non-cash items due to the fair value income of warrants outstanding, partially offset by accrued interest on the company’s existing loan with the EIB and foreign exchange losses. Other expense in the nine months ended September 30, 2015 consisted primarily of $13.9 million fair value expense of warrants outstanding, partially offset by foreign exchange gains of $4.6 million.
Cash Position
As of September 30, 2016, cash and cash equivalents totaled $30.4 million compared to $53.8 million as of June 30, 2016.
We expect that our rate of expenses will decrease significantly as our clinical study for COGENZIA concluded and as we finalise completion of the expansion of our Saal, Germany manufacturing facility. We plan to manage our resources to extend the cash runway until after the anticipated XARACOLL NDA approval, expected in the third quarter of 2017.
For further financial information for the quarter ended September 30, 2016, please refer to the financial statements appearing at the end of this release.
About Innocoll Holdings plc
Innocoll is a global, specialty pharmaceutical company with late stage development programs that is dedicated to engineering better medicines to help patients get better. Our proprietary, biocompatible, and biodegradable collagen products are precision-engineered for targeted use. Applied locally to surgery sites, they are designed to provide a range of benefits. The company's late stage product pipeline is focused on addressing a number of large unmet medical needs, including: XARACOLL for the treatment of postoperative pain and COLLAGUARD (INL-003), a barrier for the prevention of post-surgical adhesions.
Our currently approved products include: COLLAGUARD® (ex-US), COLLATAMP® G, SEPTOCOLL® E, REGENEPRO®, COLLACARE®, COLLEXA®, and ZORPREVA®, some of which are sold globally through strategic partnerships, including those with Takeda, EUSA Pharma, Biomet 3i and Biomet. All of our native collagen products — from extraction/purification of type-1 collagen through final delivery form — are manufactured at our certified, integrated plant in Saal, Germany.
For more information, please visit www.innocoll.com.
CollaRx®, Collatamp®, COLLAGUARD®, Collieva®, CollaCare®, Collexa®, COGENZIA® LidoColl®, LiquiColl®, and XARACOLL® are registered trademarks, and CollaPress™, DermaSil™, Durieva™, and Zorpreva™ are trademarks of the company.
Contact:
Corporate:
Pepe Carmona
Chief Financial Officer
(215) 983-3362
pcarmona@innocoll.com
Jeannie Sorenson, M.D.
Vice President, Investor Relations
(314) 458-7355
jsorenson@innocoll.com