On May 3, 2017 RedHill Biopharma Ltd. (NASDAQ:RDHL) (Tel-Aviv Stock Exchange:RDHL) ("RedHill" or the "Company"), a specialty biopharmaceutical company primarily focused on the development and commercialization of late clinical-stage, proprietary, orally-administered, small molecule drugs for gastrointestinal and inflammatory diseases and cancer, reported its financial results for the quarter ended March 31, 2017. Schedule your 30 min Free 1stOncology Demo! The Company will host a conference call on Wednesday, May 3, 2017, at 9:00 am EDT to review the financial results and business highlights. Dial-in details are included below.
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Financial highlights for the quarter ended March 31, 20174
Research and Development Expenses for the first quarter of 2017 were $8.1 million, up 74% compared to the first quarter of 2016 and up 9% compared to the fourth quarter of 2016. The increase was mainly due to the ongoing Phase III and Phase II studies with BEKINDA (RHB-102)5 for gastroenteritis and diarrhea-predominant irritable bowel syndrome (IBS-D), respectively, the ongoing Phase III study with RHB-104 for Crohn’s disease, ongoing studies with YELIVA (ABC294640)6 for multiple indications and preparations for the upcoming confirmatory Phase III study with RHB-105 for H. pylori infection.
Selling, Marketing and Business Development Expenses for the first quarter of 2017 were $0.6 million, up 94% compared to the first quarter of 2016. The increase was mainly due to activities related to the Company’s U.S. commercial operations.
General and Administrative Expenses for the first quarter of 2017 were $1.3 million, up 44% compared to the first quarter of 2016 and up 12% compared to the fourth quarter of 2016. The increase was mainly due to expanded operations.
Operating Loss for the first quarter of 2017 was $10.1 million, up 71% compared to the first quarter of 2016 and up 12% compared to the fourth quarter of 2016. The increase was mainly due to an increase in Research and Development Expenses, as detailed above.
Financial Income, net for the first quarter of 2017 was $1.5 million, compared to $379 thousand in the first quarter of 2016. The increase was mainly due to a fair value gain on derivative financial instruments related to investors’ warrants from the December 2016 financing.
Net Cash Used in Operating Activities for the first quarter of 2017 was $10.3 million, up 107% compared to the first quarter of 2016 and up 1% compared to the fourth quarter of 2016. The increase was mainly due to the increase in Operating Loss, as detailed above.
Net Cash Used in Investment Activities for the first quarter of 2017 was $18.6 million, compared to $4.6 million in the first quarter of 2016. The increase was mainly due to investments of the cash in bank deposits and purchase of marketable securities.
Net Cash Provided by Financing Activities for the first quarter of 2017 was $4.5 million compared to an immaterial amount for the first quarter of 2016. The increase was mainly due to proceeds from the exercise of warrants and options into ordinary shares.
Cash Balance as of March 31, 2017 was $61 million, a decrease of $5 million, compared to $66 million as of December 31, 2016. The decrease was a result of cash used in operating activities and investment activities, offset by cash provided by financing activities, as described above.
Micha Ben Chorin, RedHill’s CFO, said: "We are pleased with the achievements in the first quarter of 2017, which included securing rights for two commercial GI products in the U.S. as part of RedHill’s strategic plan of becoming a revenue-generating, gastrointestinal-focused, specialty pharmaceutical company in the U.S. and setting the stage for our late clinical-stage pipeline drugs, if approved. Our cash position of $61 million at the end of the first quarter should allow us to continue to execute our strategic plans for 2017 and diligently advance our late-stage clinical programs. We look forward to important events expected in the coming months, including top-line results from the Phase III GUARD study with BEKINDA for gastroenteritis, initiation of the confirmatory Phase III study with RHB-105 for H. pylori infection, a second independent DSMB meeting for the ongoing Phase III MAP US study with RHB-104 for Crohn’s disease and the initiation of promotional activities in the U.S. with Donnatal and EnteraGam."
Conference Call and Webcast Information:
The Company will host a conference call on Wednesday, May 3, 2017, at 9:00 am EDT to review the financial results and business highlights.
To participate in the conference call, please dial the following numbers 15 minutes prior to the start of the call: United States: +1-877-280-2342; International: +1-212-444-0896; and Israel: +972-3-763-0147. The access code for the call is 1922788.
The conference call will be broadcasted live and available for replay on the Company’s website, View Source, for 30 days. Please access the Company’s website at least 15 minutes ahead of the conference to register, download, and install any necessary audio software.
Recent operational highlights:
On January 3, 2017, RedHill announced the signing of an exclusive co-promotion agreement with a subsidiary7 of Concordia International Corp. (NASDAQ:CXRX) (TSX:CXR) ("Concordia"), granting RedHill certain U.S. promotion rights for Donnatal8, a prescription oral drug used with other drugs for the treatment of irritable bowel syndrome (irritable colon, spastic colon, mucous colitis) and acute enterocolitis (inflammation of the small bowel). Under the terms of the agreement, RedHill and Concordia will share the revenues generated from the promotion of Donnatal by RedHill, based on an agreed upon split.
On January 5, 2017, RedHill announced the signing of a new collaboration agreement with the Department of Molecular Biology and Genetics of Denmark-based Aarhus University for the evaluation of RedHill’s Phase II-stage oncology drug candidate, MESUPRON (upamostat). The new research collaboration follows previous non-clinical studies conducted with Denmark’s Aarhus University and is designed to identify additional high affinity molecular targets of MESUPRON. A Phase I/II study with MESUPRON in pancreatic cancer is planned to be initiated in the second half of 2017.
On January 10, 2017, RedHill announced first dosing in a three-way crossover pharmacokinetic (PK) study with RHB-105 in 18 subjects (healthy volunteers), intended to evaluate the bioavailability of RHB-105 actives versus the comparator in the planned confirmatory Phase III study (dual therapy of amoxicillin and omeprazole) and a food-effect study with RHB-105. The confirmatory Phase III study with RHB-105 for H. pylori infection is planned to be initiated in the second quarter of 2017. Subject to a successful outcome, the confirmatory Phase III study and the supportive PK program are expected to complete the package required for a U.S. NDA for RHB-105.
On January 11, 2017, RedHill announced that RHB-104 had been granted Qualified Infectious Disease Product (QIDP) designation by the FDA for the treatment of nontuberculous mycobacteria (NTM) infections. The QIDP designation was granted under the FDA’s Generating Antibiotic Incentives Now (GAIN) Act, which is intended to encourage development of new antibiotic drugs for the treatment of serious or life-threatening infections. Under the FDA’s GAIN Act, QIDP designation allows for Fast-Track status and Priority Review, potentially leading to a shorter NDA review time by the FDA, and, if approved, an additional five years of U.S. market exclusivity on top of the standard exclusivity period. RedHill plans to consult with the FDA regarding the RHB-104 development program for NTM infections.
On February 21, 2017, RedHill announced that the last patient enrolled in the randomized, double-blind, placebo-controlled Phase III clinical study with BEKINDA 24 mg in the U.S. for the treatment of acute gastroenteritis and gastritis (the GUARD study) had completed the treatment course and observation period for the primary endpoint evaluation. The GUARD study treated 321 adults and children over the age of 12 in 29 U.S. clinical sites. Top-line results are expected in the second quarter of 2017. Furthermore, on April 18, 2017, RedHill announced that it had received notices of allowance from the United States Patent and Trademark Office (USPTO) for two new patents covering BEKINDA. Once granted, the patents are expected to be valid until at least 2034.
On March 21, 2017, RedHill announced dosing of the first patient in the open-label extension study to the Phase III study with RHB-104 for the treatment of Crohn’s disease (the MAP US study). The open-label extension study (the MAP US2 study) is intended to assess the safety and efficacy of RHB-104 in patients who have completed 26 weeks of treatment in the ongoing MAP US study and remain with active Crohn’s disease (CDAI > 150); these patients have the opportunity to receive treatment with RHB-104 for a 52-week period in the open-label extension study.
On April 4, 2017, RedHill announced that the FDA had granted YELIVA (ABC294640) Orphan Drug designation for the treatment of cholangiocarcinoma. Orphan Drug designation allows RedHill to benefit from a seven-year marketing exclusivity period for the indication, if approved for marketing, as well as other development incentives to develop YELIVA for cholangiocarcinoma. A Phase IIa clinical study with YELIVA in patients with advanced, unresectable, intrahepatic and extrahepatic cholangiocarcinoma is planned to be initiated in the third quarter of 2017.
On April 5, 2017, RedHill announced the signing of an exclusive license agreement with Entera Health Inc. ("Entera Health"), granting RedHill the exclusive U.S. rights to EnteraGam9, a commercially-available medical food intended for the dietary management of chronic diarrhea and loose stools which must be administered under medical supervision. Under the terms of the agreement, RedHill will pay Entera Health royalties based on net sales generated from the sale of EnteraGam by RedHill.
On April 13, 2017, RedHill, together with IntelGenx Corp. (TSX-V:IGX) (OTCQX:IGXT) ("IntelGenx"), announced that the Ministry of Health of Luxembourg had granted national marketing authorization for RIZAPORT (5 mg and 10 mg). The national marketing authorization was granted in Luxembourg on the basis of the European Decentralized Procedure (DCP), in which Luxembourg served as the Concerned Member State. The approval in Luxembourg marks the completion of the current marketing approval process for RIZAPORT under the European DCP.
On April, 24, 2017, RedHill announced enrollment of the last patient in the Phase II study with BEKINDA 12 mg for the treatment of IBS-D. The randomized, double-blind, placebo-controlled Phase II study is evaluating the safety and efficacy of BEKINDA 12 mg in 127 U.S. patients with IBS-D. Top-line results are expected in the third quarter of 2017.
About Donnatal:
Donnatal (Phenobarbital, Hyoscyamine Sulfate, Atropine Sulfate, Scopolamine Hydrobromide), a prescription drug, is classified as possibly effective as an adjunctive therapy in the treatment of irritable bowel syndrome (irritable colon, spastic colon, mucous colitis) and acute enterocolitis. Donnatal slows the natural movements of the gut by relaxing the muscles in the stomach and intestines and acts on the brain to produce a calming effect. Donnatal comes in two formulations: immediate release Donnatal Tablets and immediate release Donnatal Elixir, a fast-acting liquid.
Important Safety Information about Donnatal:
Donnatal is contraindicated in patients who have glaucoma, obstructive uropathy, obstructive disease of the gastrointestinal tract, paralytic ileus, unstable cardiovascular status, severe ulcerative colitis, myasthenia gravis, hiatal hernia with reflux esophagitis, or known hypersensitivity to any of the ingredients. Patients who are pregnant or breast-feeding or who have autonomic neuropathy, hepatic or renal disease, hyperthyroidism, coronary heart disease, congestive heart failure, cardiac arrhythmias, tachycardia or hypertension should notify their doctor before taking Donnatal. Side effects may include: dryness of the mouth, urinary retention, blurred vision, dilation of pupils, rapid heartbeat, loss of sense of taste, headache, nervousness, drowsiness, weakness, dizziness, insomnia, nausea, vomiting and allergic reactions which may be severe.
Further information, including prescribing information, can be found on www.donnatal.com.
Please see the following website for complete important safety information about Donnatal:
View Source
About EnteraGam:
EnteraGam (a serum-derived bovine immunoglobulin/protein isolate, SBI) is a medical food product intended for the dietary management of chronic diarrhea and loose stools. EnteraGam must be administered under medical supervision. EnteraGam binds microbial components10, such as toxic substances released by bacteria, that upset the intestinal environment. This helps prevent them from penetrating the lining of the intestine, which may contribute to chronic diarrhea and loose stools in people who have specific intestinal disorders11 12.
Safety Information about EnteraGam:
EnteraGam contains beef protein; therefore, patients who have an allergy to beef or any other component of EnteraGam should not take this product. EnteraGam has not been studied in pregnant women, in women during labor and delivery, or in nursing mothers. The choice to administer EnteraGam during pregnancy, labor and delivery, or to nursing mothers is at the clinical discretion of the prescribing physician.
EnteraGam does not contain any milk-derived ingredients such as lactose, casein, or whey. EnteraGam is gluten-free, dye-free and soy-free.
Please see full Product Information.
To report suspected adverse reactions, contact Entera Health, Inc. at 1-855-4ENTERA (1-855-436-8372), or the FDA at 1-800- FDA-1088 (1-800-332-1088) or www.fda.gov/medwatch.