"During the first quarter 2016, on the commercial side of our business, we continued to focus on building new, high value partnerships and securing a strategic transaction or alliance to realize the full healthcare and economic potential of oral Eligen B12™," said
First Quarter 2016 HIGHLIGHTS
- Novo Nordisk Commenced Global Phase 3a Clinical Trials for Oral Semaglutide. During the first quarter of 2016,
Novo Nordiskcommenced Phase 3a testing for oral semaglutide, which utilizes Emisphere's absorption-enhancing monosodium N-[8-(2-hydroxybenzoyl) amino] caprylate (SNAC) carrier. Novo Nordiskplans to conduct ten clinical trials enrolling approximately 9,300 patients with Type-2 diabetes in this Phase 3a program. The advancement of oral semaglutide into Phase 3a development represents a significant milestone for both Emisphereand the Eligen® Technology platform and supports the Company's belief that products developed using Eligen® carriers have the potential to overcome bioavailability challenges commonly associated with the oral administration of peptides and certain other compounds.
- Novo Nordisk Continues Feasibility Studies under our Development and License Agreement to Develop Oral Formulations Targeting Metabolic Indications. In
October 2015, Emisphereand Novo Nordiskentered into a new license agreement to develop and commercialize oral formulations of four classes of Novo Nordisk's investigational molecules targeting major metabolic disorders, including diabetes and obesity, using Emisphere's oral Eligen® Technology. Emispherereceived a $5.0 millionupfront licensing fee, and is eligible to receive up to $207 millionin development and sales milestone payments in addition to royalties on sales of each successfully commercialized product under this agreement.
- Exploring Strategic Partnership Opportunities for Oral Eligen B12™ in the
U.S.and Internationally. Eligen B12™ is the first and only once-daily oral prescription medical food tablet shown to normalize B12 levels without the need for an injection. Eligen B12™ is indicated for the dietary management of patients who have a medically-diagnosed vitamin B12 deficiency, associated with a disease or condition that cannot be managed by a modification of the normal diet alone. Eligen B12™ utilizes Emisphere'sSNAC carrier to chaperone B12 through the gastric lining and directly into the bloodstream even in the absence of intrinsic factor, a protein made in the stomach that normally facilitates B12 absorption.
- Global Eligen® Technology Business Development Initiatives Continue. During the first quarter 2016, we continued to pursue our comprehensive business development initiative designed to identify and secure new Eligen® Technology partnerships. Eligen® Technology is a proven delivery system technology that is applicable to
a broad range of chemical entities and has been shown to increase the benefit of the therapy by improving bioavailability or absorption or by decreasing time to onset of action. The Company currently owns rights to an extensive portfolio of carriers with strong patent protection. The current focus of the business development initiative is on next generation, smaller proteins and peptides, proven and/or approved drug compounds, and the development of new oral formulations to replace injectables.
- Grant of Waivers and Extensions Under Debt Facility, Convertible Notes and Reimbursement Notes. During
November 2015, the creditor under our Loan Agreement, Convertible Notes and Reimbursement notes agreed to waive any event of default resulting from our failure to satisfy the net sales milestone for the Eligen B12™ product for the 2015 fiscal year specified in our Loan and Royalty Agreements. The creditor has also agreed to extend the date by which we are required to use 50% of the $14 millionreceived from Novo Nordiskto pre-pay certain loans and notes (the "Loan Prepayment") until June 13, 2016, provided that we deliver to the creditor a revised proposal (the "Proposal") regarding potential amendments and waivers to certain loan agreements and related matters by May 20, 2016. In the event we do not timely deliver the Proposal, the Loan Prepayment will be due on May 20, 2016. We intend to submit the Proposal before May 20, 2016. We believe that our current cash balance will provide sufficient capital to continue operations through approximately July 2016. However, if the pre-payment obligation is further extended or waived, the Company will have sufficient cash to operate through approximately July 2017.
FIRST QUARTER 2016 FINANCIAL RESULTS
The Company reported an operating loss of
Total operating expenses were
Weighted average basic and diluted shares outstanding for the three months ended
Under terms of its loan agreements, the Company is obligated to pre-pay certain loans and notes using 50% of any extraordinary receipts, such as the
We believe that our current cash balance will provide sufficient capital to continue operations through approximately
While our plan is to raise capital from commercial operations and/or product partnering opportunities to address our capital deficiencies and meet our operating cash requirements, there is no assurance that our plans will be successful. If we fail to generate sufficient capital from commercial operations or partnerships, we will need to seek capital from other sources and risk default under the terms of our existing loans. We cannot assure you that financing will be available on favorable terms or at all. If we fail to generate sufficient additional capital from sales of oral Eligen B12™ or obtain substantial cash inflows from existing or new partners or other sources prior to
CONFERENCE CALL AND WEBCAST INFORMATION
The live webcast of the conference call can be accessed through
the Company's web site at www.emisphere.com. The call can also be accessed by dialing (877) 303-9483 (
ABOUT ELIGEN B12™
Eligen B12™ is indicated for the dietary management of patients who have a medically-diagnosed vitamin B12 deficiency, associated with a disease or condition that cannot be managed by a modification of the normal diet alone. Eligen B12™ is designed so that patients only need to take a single oral tablet (cyanocobalamin 1000 mcg/salcaprozate sodium [SNAC] 100 mg) of B12 daily.
Eligen B12™ is the first and only prescription medical food that has been shown to normalize vitamin B12 levels comparable to an intramuscular (IM) injection of B12. In a study that compared the impact of Eligen B12™ and IM B12 on plasma B12 levels in 50 patients with demonstrated B12 deficiency (serum B12 < 350 pg/mL), both products normalized B12 levels by Day 15 (first observation) and maintained normal levels over the duration of the study (three months). In a study that compared bioavailability in 20 healthy subjects of Eligen B12™ with that of a standard oral B12 supplement, the bioavailability of Eligen B12™ was 5.09 percent compared with 2.16 percent, which is more than double the bioavailability of the conventional over-the-counter oral B12 supplement formulation at the same dose.
Eligen B12™ is classified by the
For more information, visit www.eligenb12.com.
ELIGEN B12™ IMPORTANT SAFETY INFORMATION
Those with an allergy to B12, cobalt or any ingredients of Eligen B12™ should not take this product. Eligen B12™ should not be taken by people who have Leber's disease, which physicians may refer to as hereditary optic nerve atrophy. Cyanocobalamin (B12) can lead to optic nerve damage (and possibly blindness) in people with Leber's disease. Note that Eligen B12™ has not been studied in patients below 18 years of age.
SAFE HARBOR STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
The statements in this release or oral statements made by representatives of
|CONDENSED STATEMENT OF OPERATIONS|
|For the three months ended |
|(in thousands, except share and per share data)|
|For the Three Months Ended|
|Cost of goods sold||52||25|
|Gross profit (loss)||321||(19||)|
|Costs and expenses:|
|Research and development||91||228|
|General and administrative expenses||1,340||1,293|
|Depreciation and amortization||4||3|
|Total costs and expenses||3,030||4,649|
|Other non-operating income (expense):|
|Change in fair value of derivative instruments|
|Interest expense, related party||(2,696||)||(1,841||)|
|Total other non-operating income (expense)||880||(28,300||)|
|Net loss per share, basic and diluted||$||(0.03||)||$||(0.54||)|
|Weighted average shares outstanding, basic and diluted||60,687,478||60,687,478|
|CONDENSED BALANCE SHEETS|
|(in thousands, except share and per share data)|
|Cash and cash equivalents||$||10,360||$||12,898|
|Accounts Receivable, net||297||455|
|Prepaid expenses and other current assets||769||1,081|
|Total Current Assets||12,749||15,774|
|Equipment and leasehold improvements, net||8||12|
|LIABILITIES AND STOCKHOLDERS DEFICIT|
|Accounts payable and accrued expenses||$||1,649||$||2,121|
|Notes payable, related party||7,000||7,000|
|Deferred Revenue, current portion||684||631|
|Royalty Payable - related party||208||208|
|Total current liabilities||21,691||22,855|
|Notes payable, related party, net of related discount||54,408||54,172|
|Accrued interest, related party||2,376||-|
|Derivative instruments - related party||32,245||35,071|
|Royalty payable - related party||86||-|
|Deferred lease liability and other liabilities||11||14|
|Commitments and Contingencies||-||-|
|Preferred stock, ||-||-|
|Common stock, ||610||610|
|Common stock held in treasury, at cost; 289,732 shares||(3,952||)||(3,952||)|
|Total stockholders' deficit||(153,652||)||(151,918||)|
|Total liabilities and stockholders' deficit||$||12,781||$||15,810|
Michael R. Garone, CFO 973.532.8005 firstname.lastname@example.org
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