InVivo Therapeutics Reports 2013 Financial Results and Business Update

Business Wire

CAMBRIDGE, Mass.--(BUSINESS WIRE)--

InVivo Therapeutics Holdings Corp. (NVIV), a life sciences company focused on the development and commercialization of novel drug delivery technologies as well as biopolymer devices for the treatment of spinal cord injuries and other nervous system conditions, today reported financial results for the year ended December 31, 2013.

Mark Perrin, the CEO of InVivo, said, “In the first ten weeks of this year, key leadership additions were made including the appointments of Tamara Joseph as Senior Vice President, General Counsel and Chief Compliance Officer, Thomas Ulich, MD as Chief Scientific Officer, and Louis Vaickus, MD as Chief Medical Officer. Operationally, we continue to focus our efforts to initiate the first-in-man study of our novel scaffolding device to treat acute spinal cord injuries. Lastly, we have significantly increased our business development activities to leverage the opportunities with our scaffold and hydrogel platforms.”

The Company also provided an update with respect to the clinical study of its scaffold device. One clinical site has now received Institutional Review Board approval and finalized its contract and a second site is nearing completion of these steps. Additional sites are progressing through this process. As a result of manufacturing issues with respect to the scaffold, the company expects that its first clinical study site will receive product and be ready to enroll subjects in the second quarter of 2014. The Company also announced that, as a result of ongoing discussions with clinical experts, we are reviewing non-traumatic spinal cord impairment indications that could benefit from our device. This effort could result in additional uses of the scaffold and may expand the entire development program.

Financial Results

For the year ended December 31, 2013, the Company reported a net loss of approximately $38,756,000 or $.52 per diluted share, compared to net income of $4,664,000 or $.06 per diluted share, for the year ended December 31, 2012. Included in results for the years ended December 31, 2013 and 2012 were non-cash gains (losses) from modification of warrants and derivatives of $(18,871,000), and $17,479,000, respectively, reflecting changes in the fair market value of the derivative warrant liability. Exclusive of these non-cash items, the adjusted net loss for the year ended December 31, 2013, was $19,120,000, or $.26 per diluted share, compared to an adjusted net loss of $12,816,000, or $.18 per diluted share for 2012. The Company ended the year with $13,980,000 of cash and cash equivalents. Adjusted net loss and adjusted net loss per share are non-GAAP financial measures that exclude the items noted. A reconciliation of these measures to the comparable GAAP measure is included with the tables contained in this release. The Company believes a presentation of these non-GAAP measures provides useful information to investors to better understand, on a period-to-period comparable basis, financial amounts both including and excluding these identified items, the Company's operations.

About InVivo Therapeutics

InVivo Therapeutics Holdings Corp. is a pioneering biomaterials company with unique technologies for drug delivery with a focus on treatment of spinal cord injuries. The Company was founded in 2005 with proprietary technology co-invented by Robert Langer, ScD., Professor at Massachusetts Institute of Technology, and Joseph P. Vacanti, M.D., who is affiliated with Massachusetts General Hospital. In 2011 the Company earned the David S. Apple Award from the American Spinal Injury Association for its outstanding contribution to spinal cord injury medicine. The publicly traded company is headquartered in Cambridge, MA. For more details, visit, www.invivotherapeutics.com.

Safe Harbor Statement

Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements within the meaning of the federal securities laws. Any forward-looking statements contained herein are based on current expectations, and include statements regarding the Company’s expectations with respect to the commencement of human clinical trials for the scaffold product, increased business development activities, and future uses and indications for its scaffold product. These statements are subject to a number of risks and uncertainties that could cause actual future results to differ materially from current expectations including, but not limited to, risks and uncertainties relating to the Company’s limited operating history and history of net losses, its ability to raise substantial additional capital to finance planned operations, its ability to successfully commercialize current and future product candidates and to successfully complete clinical trials and obtain and maintain regulatory approval of its product candidates, its ability to protect and maintain its intellectual property, and other risks associated with the Company’s business and strategies identified and described in more detail in our filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2013 and subsequent filings with the Securities and Exchange Commission. We do not undertake to update these forward-looking statements made by us.

             

InVivo Therapeutics Holdings Corp.

(A Development Stage Company)

Consolidated Balance Sheets

 
December 31,
  2013   2012
ASSETS:
Current assets:
Cash and cash equivalents $ 13,980,321 $ 12,825,090
Restricted cash 601,471 601,351
Prepaid expenses and other current assets   20,087     143,867  
 
Total current assets 14,601,879 13,570,308
 
Property and equipment, net 2,337,210 2,311,942
Other assets   157,355     179,415  
 
Total assets $ 17,096,444   $ 16,061,665  
 
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT):
 
Current liabilities:
Accounts payable $ 899,260 $ 1,152,550
Note payable-current portion 73,987
Capital lease payable-current portion 2,799 32,606
Derivative warrant liability 14,584,818
Accrued expenses   1,292,185     1,021,275  
 
Total current liabilities 2,268,231 16,791,249
 
Loan payable 1,920,000 1,578,000
Note payable-less current portion 18,497
Capital lease payable-less current portion       2,799  
 
Total liabilities   4,206,728     18,372,048  
 
Commitments and contingencies
Stockholders’ equity (deficit):
Common stock, $0.00001 par value, authorized 200,000,000 shares;

issued and outstanding 78,773,736 and 65,881,122 shares at December 31 2013 and 2012, respectively

788 659
Additional paid-in capital 94,798,231 40,842,339
Deficit accumulated during the development stage   (81,909,303 )   (43,153,381 )
 
Total stockholders’ equity (deficit)   12,889,716     (2,310,383 )
 
Total liabilities and stockholders’ equity (deficit) $ 17,096,444   $ 16,061,665  
 
 

InVivo Therapeutics Holdings Corp.

(A Development Stage Company)

Consolidated Statements of Operations

               

Years Ended
December 31,

Period from
November 28,
2005
(inception) to
December 31,
2013

2013 2012 2011
Operating expenses:
Research and development $ 10,533,004 $ 6,375,795 $ 4,102,847 $ 25,792,663
General and administrative   8,472,197     6,403,656     4,555,872     23,127,390  
 
Total operating expenses   19,005,201     12,779,451     8,658,719     48,920,023  
 
Operating loss   (19,005,201 )   (12,779,451 )   (8,658,719 )   (48,920,023 )
 
Other income (expense):
Other income 383,000
Interest income 15,279 35,184 8,759 70,512
Interest expense (129,902 ) (71,726 ) (12,676 ) (1,267,959 )
Modification of warrants (764,769 ) (764,769 )
Derivatives gain (loss)   (18,871,329 )   17,479,674     (26,065,579 )   (31,409,816 )
 
Other income (expense), net   (19,750,721 )   17,443,132     (26,069,496 )   (32,989,032 )
 
Net income (loss) $ (38,755,922 ) $ 4,663,681   $ (34,728,215 ) $ (81,909,055 )
 
Net income (loss) per share, basic $ (0.52 ) $ 0.07   $ (0.67 ) $ (2.04 )
 
Net income (loss) per share, diluted $ (0.52 ) $ 0.06   $ (0.67 ) $ (2.04 )
 
Weighted average number of common shares outstanding, basic   73,991,686     63,226,899     51,894,871     40,121,647  
 
Weighted average number of common shares outstanding, diluted   73,991,686     71,919,419     51,894,871     40,121,647  
 

Reconciliation of GAAP to non-GAAP measures

 

InVivo Therapeutics Holdings Corp.

(A Development Stage Company)
 
      Years Ended
December 31,
  2013             2012  
 
Reported GAAP net income (loss) $ (38,755,922 ) $ 4,663,681
Add Back: Derivative gain (loss) (18,871,329 ) 17,443,132
Add Back: Modification of Warrants (764,769 )
Pro Forma Net Loss $ (19,119,824 ) $ (12,815,993 )
 
Reported GAAP net income (loss) per diluted share $ (0.52 ) $ 0.06
Derivative gain (loss) per diluted share (0.25 ) 0.24
Modification of Warrants gain (loss) per diluted share   (0.01 )  
Pro-Forma net income (loss) per diluted share $ (0.26 ) $ (0.18 )
 

Contact:
InVivo Therapeutics Holdings Corp.
Brian Luque, 617-863-5535
Investor Relations
bluque@invivotherapeutics.com

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