PETACH TIKVA, Israel, Nov. 17, 2015 (GLOBE NEWSWIRE) — Macrocure Ltd. (“Macrocure” or the “Company”) (NASDAQ:MCUR), today provided a corporate update and reported financial results for the third quarter and nine months ended September 30, 2015.
“As previously stated, we remain focused on the interests of all stakeholders of Macrocure and are committed to maximizing the value of the Company. Following our disappointing clinical announcements regarding our Phase III studies for CureXcell on August 19 and October 27, we are analyzing data from both Phase III studies in VLU and DFU to understand why these trials did not meet their study endpoints and to determine if there is continuing value to the underlying technology. As this analysis proceeds, we have also commenced a process to review all strategic alternatives for the Company. Finally as we assess our alternatives, we continue to focus on managing and conserving our existing cash through cost reduction and restructuring initiatives currently underway including the reduction of approximately two thirds of our staff,” stated Nissim Mashiach, President and Chief Executive Officer of Macrocure.
Financial Results for the Third Quarter Ended September 30, 2015
Research and development expenses for the third quarter of 2015 were $4.2 million, compared with $3.9 million for the third quarter of 2014. This increase was primarily due to total clinical trial expenses for our MC-102 and MC-105 Phase III clinical studies.
General and administrative expenses for the third quarter of 2015 were $1.6 million, compared with $1.7 million for the third quarter of 2014. This decrease was primarily due to reductions in payroll related and non-cash stock-based compensation expenses.
For the third quarter of 2015, the Company posted a net loss of $5.8 million, or $0.32 loss per share, compared with a net loss of $10.1 million, or $0.70 loss per share, in the third quarter of 2014.
Financial Results for the Nine Months Ended September 30, 2015
Research and development expenses for the nine months ended September 30, 2015 were $14.3 million, compared with $9.9 million for the comparable period in 2014. This increase was primarily due to increases in our total Phase III clinical trial expenses.
General and administrative expenses for nine months ended September 30, 2015 were $5.1 million, compared with $3.5 million for the comparable period in 2014. This increase was primarily due to elevated payroll, stock-based compensation for existing and new employees and senior staff recruiting expenses, as well as increased professional expenses and customary costs associated with being a publicly-traded company.
For the nine months ended September 30, 2015, the Company posted a net loss of $19.4 million, or $1.06 loss per share, compared with a net loss of $17.9 million, or $1.84 loss per share, in the comparable period in 2014.
Balance Sheet Information and Other Items
As of September 30, 2015, cash and cash equivalents, including short-term investments, were $30.3 million. The Company has no debt outstanding.
As of September 30, 2015, the Company had 16,710,181 ordinary shares outstanding. That figure excludes an additional 1,332,804 ordinary shares issuable upon exercise of warrants at an exercise price of NIS 0.01 per share that were outstanding as of that date.
Guidance
Given the Company’s recently announced clinical trial results, previous financial guidance, updated as recently as the second quarter financial results reported on August 4, 2015, is withdrawn.
About Macrocure Ltd.
Macrocure Ltd. is a clinical-stage biotechnology company focused on developing a novel therapeutic platform to address chronic and hard-to-heal wounds, such as diabetic foot ulcers and venous leg ulcers.
For more information, please visit: www.macrocure.com.
Cautionary Note Regarding Forward-Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, Section 21E of the US Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts, such as statements regarding assumptions and results related to financial results forecasts, commercial results, clinical trials and regulatory authorizations. Forward-looking statements are based on Macrocure’s current knowledge and its present beliefs and expectations regarding possible future events and are subject to risks, uncertainties and assumptions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including, but not limited to, unexpected results of clinical trials, delays or denial in regulatory approval process or additional competition in the market, including those risks discussed under the heading “Risk Factors” in Macrocure’s Annual Report on Form 20-F for the year ended December 31, 2014 filed with the Securities and Exchange Commission. The forward-looking statements made herein speak only as of the date of this announcement and Macrocure undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.
| Unaudited Condensed Interim Consolidated Statements of Financial Position | ||
| As of | As of | |
| U.S. dollars in thousands | 30-Sep | 31-Dec |
| 2015 | 2014 | |
| Assets | ||
| Current assets | ||
| Cash and cash equivalents | 11,515 | 10,868 |
| Short term investments | 18,769 | 35,313 |
| Accounts receivable | 504 | 536 |
| Total current assets | 30,788 | 46,717 |
| Non-current assets | ||
| Property and equipment, net | 640 | 451 |
| Intangible assets, net | — | 276 |
| Deposits | 5 | 1,255 |
| Total non-current assets | 645 | 1,982 |
| Total assets | 31,433 | 48,699 |
| Liabilities and Shareholders’ Equity | ||
| Current liabilities | ||
| Trade and other payables | 2,739 | 2,488 |
| Total liabilities | 2,739 | 2,488 |
| Shareholders’ equity | ||
| Ordinary shares of NIS 0.01 par value | 46 | 45 |
| Share premium | 100,390 | 95,941 |
| Capital reserve | 8,027 | 6,167 |
| Warrants held by shareholders | 7,835 | 12,256 |
| Accumulated deficit | (87,604) | (68,198) |
| Total shareholders’ equity | 28,694 | 46,211 |
| Total liabilities and shareholders’ equity | 31,433 | 48,699 |
| Unaudited Condensed Interim Consolidated Statements of Loss | ||||
| Nine months ended | Three months ended | |||
| U.S. dollars in thousands | September 30, | September 30, | ||
| 2015 | 2014 | 2015 | 2014 | |
| Research and development expenses, net | 14,257 | 9,863 | 4,186 | 3,946 |
| General and administrative expenses | 5,116 | 3,512 | 1,572 | 1,689 |
| Operating Loss | (19,373) | (13,375) | (5,758) | (5,635) |
| Finance income (expense), net | 119 | (4,410) | (6) | (4,421) |
| Loss before income tax | (19,254) | (17,785) | (5,764) | (10,056) |
| Taxes on income | (152) | (78) | (65) | — |
| Loss for the period | (19,406) | (17,863) | (5,829) | (10,056) |
| Other Comprehensive income: | ||||
| Net change in fair value of available for sale financial assets | 26 | — | 11 | — |
| Total comprehensive loss for the year | (19,380) | (17,863) | (5,818) | (10,056) |
| Loss per share – basic and diluted (in U.S. dollars) (*) | (1.06) | (1.84) | (0.32) | (0.70) |
| Weighted average number of Ordinary shares outstanding | 18,248,068 | 9,731,657 | 18,248,923 | 14,306,886 |
| Unaudited Condensed Interim Consolidated Statements of Cash Flows | ||||
| Nine months ended | Three months ended | |||
| U.S. dollars in thousands | September 30, | September 30, | ||
| 2015 | 2014 | 2015 | 2014 | |
| Cash flows from operating activities: | ||||
| Loss for the period | (19,406) | (17,863) | (5,829) | (10,056) |
| Adjustments: | ||||
| Depreciation | 74 | 82 | 26 | 25 |
| Amortization | 276 | 414 | — | 138 |
| Financing income, net | (119) | 4,410 | 6 | 4,421 |
| Taxes on income | 152 | 78 | 65 | — |
| Share based compensation | 1,847 | 1,222 | 586 | 655 |
| 2,230 | 6,206 | 683 | 5,239 | |
| Changes in operating assets and liability items: | ||||
| Decrease (increase) in accounts receivable | (33) | (606) | (213) | 1,297 |
| Increase (decrease) in trade and other payables | 259 | 33 | (133) | (1,156) |
| 226 | (573) | (346) | 141 | |
| Income tax paid | (87) | (152) | (11) | — |
| Interest received | 391 | 14 | 141 | 6 |
| Net cash used in operating activities | (16,646) | (12,368) | (5,362) | (4,670) |
| Cash flows from investing activities: | ||||
| Purchase of property and equipment | (263) | (226) | (206) | (120) |
| Decrease in long terms deposits | 4 | 7 | 1 | 1 |
| Investment in short term deposits | 11,947 | (7,500) | 2,315 | (7,500) |
| Investment in Available for Sale financial assets | (418) | — | — | — |
| Repayment of available for sale financial assets | 6,001 | — | 5,136 | — |
| Net cash used in investing activities | 17,271 | (7,719) | 7,246 | (7,619) |
| Cash flows from financing activities: | ||||
| Proceeds from issuance of shares, net of issuance costs | — | 46,689 | — | 46,689 |
| Exercise of warrants | 16 | 200 | 16 | 200 |
| Net cash provided by financing activities | 16 | 46,889 | 16 | 46,889 |
| Net increase (decrease) in cash and cash equivalents | 641 | 26,802 | 1,900 | 34,600 |
| Effect of exchange rate changes on cash and cash equivalents | 6 | (12) | 27 | (6) |
| Cash and cash equivalents at beginning of the period | 10,868 | 18,995 | 9,588 | 11,191 |
| Cash and cash equivalents at end of the period | 11,515 | 45,785 | 11,515 | 45,785 |
CONTACT: For Investors:
David Carey
Lazar Partners Ltd.
[email protected]
(212) 867-1762