Leiden, The Netherlands, 16 May 2013. Biotech company Pharming Group NV ("Pharming" or "the Company") (NYSE Euronext: PHARM) today published its financial report for the three months ended 31 March 2013.
- Revenues and other income decreased to €0.5 million (Q1 2012: €1.0 million)
- Operating costs decreased to €2.9 million (Q1 2012: €5.2 million), mainly as a result of the reduction of costs following the 2012 restructuring and lower direct project costs regarding Ruconest®
- Net financial expense increased to €3.0 million (Q1 2012: €1.9 million), mainly as a result of non-cash financial costs relating to the new €16.35 million convertible bond, while the 2012 costs related to the €8.0 million 2012 convertible bond
- The net loss decreased to €5.4 million from €6.5 million for Q1 2012
- Net cash outflows from operations decreased to €2.8 million (Q1 2012: €3.5 million) while net cash inflows from financing activities amounted to €15.3 million (including €16.0 million in relation to the issue of convertible bonds) and net cash inflows from investing activities amounted to €0.3 million received upon transfer of an intangible fixed asset
- Cash at the end of the first quarter of 2013 increased to €19.1 million (2012 FY: €6.3 million). The negative equity position decreased to €6.0 million from €7.7 million at year end 2012
- Reverse share split 10:1 approved at the EGM of 28 February 2013. The total number of shares as of today, 16 May 2013 is 168,909,635
The European Medicines Agency (EMA) provided approval for Sanofi Chimie, Pharming`s Contract Manufacturing Organization partner, to manufacture drug substance for Pharming`s product Ruconest® at their Aramon (France) site. Pharming`s ability to leverage the manufacturing process for Ruconest, a recombinant human C1 inhibitor approved for the treatment of angioedema attacks in patients with HAE (Hereditary Angioedema), represents a significant competitive advantage over manufacturers of plasma- (blood) derived products, which are dependent on blood donations.
During the quarter Pharming initated the planned downsizing of the Dutch operations. After the downsizing of the Dutch operations, which will be completed in the second quarter of this year and last years` close and sale of the US operations, the organization will consist of less than 40 FTE`s (69 in Q1 2012).
In the first quarter of 2013, the Company generated revenue and other income of €0.5 million (Q1 2012: €1.0 million). This decline is due to a decrease in orders from our EU partner Swedish Orphan Biovitrium (Sobi) for Ruconest® in the quarter, which is a reflection of the underlying slow increase in EU sales during the later part of 2012. Subsequently, ordering by Sobi has resumed in the second quarter. Costs of revenues amounted to € nil in Q1 2013 compared to €0.4 million in Q1 2012.
Total operating costs decreased by €2.3 million to €2.9 million in Q1 2013 from €5.2 million in the same period of 2012 as a result of cost reductions following the 2012 restructuring which was provided for in the 2012 annual accounts. In addition, direct project costs for the development and registration of the Company`s lead product Ruconest® were lower as cost associated with clinical study 1310 have decreased.
On 16 January 2013, the Company entered into a 8.5% convertible bond transaction of €16.35 million convertible bonds plus 16,349,999 warrants that was approved at the EGM of 28 February 2013. The bonds are repayable in cash and/or in shares in seven installments until 1 October 2013. In the first quarter of 2013, the first installment was repaid in shares and pre-payment of the second installment took place, also in shares. With regards to these pay-backs, the Company issued a total of 31,217,168 shares. Total non-cash costs associated with these bonds amounted to €3.6 million,
As a result of the above items, net loss for the first quarter of 2013 decreased to €5.4 million from €6.5 million in the same period of 2012.
Total cash and cash equivalents (including restricted cash) increased to €19.1 million at 31 March 2013 from €6.3 million at year end 2012. The increase follows from net cash outflows from operations of €2.8 million with net cash inflows from financing activities amounting to €15.3 million and net cash inflows from investing activities amounting to €0.3 million. Financing cash flows mainly result from the 2013 issue of convertible bonds which raised gross €16.0 million in cash.
The Company has negative equity since December 2011. The negative equity position at 31 March 2013 amounts to €6.0 million, a decrease of €1.6 million compared to 31 December 2012. The decrease is a result of new equity issues related to the 2013 convertible bonds in the first quarter, partially offset by the net loss for the first quarter.
The negative equity position has in itself no immediate impact on the execution of Pharming`s business plan, nor does it imply that the Company is legally required to issue new share capital. However, the Company is considering various options in order to reduce the negative equity and return to a positive equity position.
About RUCONEST® and Hereditary Angioedema
RUCONEST (INN conestat alfa) is a recombinant version of the human protein C1 esterase inhibitor, and is produced with Pharming`s proprietary transgenic technology. RUCONEST is approved in Europe for the treatment of acute angioedema attacks in patients with HAE, a genetic disorder in which the patient is deficient in or lacks a functional plasma protein C1 esterase inhibitor, resulting in unpredictable and debilitating episodes of intense swelling. The swelling may occur in one or more anatomical areas, including the extremities, face, trunk, genitals, abdomen and upper airway. The frequency and severity of HAE attacks vary and are most serious when they involve laryngeal edema, which can close the upper airway and cause death by asphyxiation. According to the U.S. Hereditary Angioedema Association, epidemiological estimates for HAE range from one in 10,000 to one in 50,000 individuals. RUCONEST is an investigational drug in the U.S. and has been granted orphan drug designation by the FDA both for the treatment of acute attacks of HAE and for prophylactic treatment of HAE.
About Pharming Group NV
Pharming Group NV is developing innovative products for the treatment of unmet medical needs. RUCONEST® is a recombinant human C1 inhibitor approved for the treatment of angioedema attacks in patients with HAE in all 27 EU countries plus Norway, Iceland and Liechtenstein, and is distributed in the EU by Swedish Orphan Biovitrum. RUCONEST is partnered with Santarus Inc (SNTS) in North America where the and a BLA for RUCONEST was submitted to the FDA in April 2013. The product is also being evaluated for various follow-on indications. Pharming has a unique GMP compliant, validated platform for the production of recombinant human proteins that, with the EU approval of Pharming`s rhC1 inhibitor, has proven capable of producing industrial volumes of high quality recombinant human protein in a significantly more economical way through low upfront capital investment and manufacturing costs, compared to current cell based technologies. Pharming now plans to utilise this platform for the development of rhFVIII for the treatment of Haemophilia A.
Additional information is available on the Pharming website, www.pharming.com.
This press release contains forward looking statements that involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company to be materially different from the results, performance or achievements expressed or implied by these forward looking statements.
Sijmen de Vries, CEO: T: +31 71 524 7400
Julia Phillips/ John Dineen, T: +44 (0)207 269 7193
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The full report including tables can be downloaded from the following link:Q1 Report 2013
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Source: Pharming Group N.V. via Thomson Reuters ONE