Avadel Pharmaceuticals plc (Nasdaq: AVDL), a company focused on
transforming medicines to transform lives, today provided a
corporate update and announced its financial results for the third
quarter ended September 30, 2021.
“The need for patients living with the chronic, debilitating
condition of narcolepsy to have a single bedtime dose of sodium
oxybate is clear. We are confident in the strength of our data and
our regulatory filing strategy for FT218, as the FDA continues
their review of our NDA. Importantly, there are no outstanding
requests from the FDA at this time, and questions previously
received have been addressed. We remain committed to patients and
sleep specialists, demonstrated by the significant advances we made
during 2021 to support a successful launch of FT218, if approved,”
said Greg Divis, Chief Executive Officer of Avadel. “This quarter,
we published the primary REST-ON results in the SLEEP journal and
continued to externalize the robust dataset supporting the
potential of FT218 in various scientific congresses. Additionally,
payor discussions continue to advance, and we are growing our
commercial team, all with the vision of disrupting the narcolepsy
market and fulfilling our promise to the narcolepsy community by
bring FT218 to patients.”
Third Quarter and Recent Company Highlights
- In October 2021, the U.S. Food and Drug
Administration (FDA) informed the company that the review of its
New Drug Application (NDA) for FT218 was ongoing beyond its
previously assigned target action date.
- Continued preparations and launch readiness activities for the
potential commercialization of FT218 as the first and only
once-at-bedtime option for managing excessive daytime sleepiness
(EDS) and cataplexy in narcolepsy
- Multiple presentations and publications in peer-reviewed forums
of data from the pivotal Phase 3 REST-ON study of FT218 throughout
the quarter, including:
- Published the previously announced primary results in SLEEP,
the journal of the Sleep Research Society
- Presented new data at the American College of Chest Physicians
(CHEST) annual meeting supporting the clinical benefit of
once-at-bedtime FT218 and patient preference for once-nightly
dosing:
- New post-hoc responder analyses
demonstrated FT218 treatment was associated with statistically
significant improvements compared to placebo on the number of
weekly cataplexy episodes and statistically significant
improvements compared to placebo on mean sleep latency
- Discrete choice experiment demonstrated that the strongest
driver of patient preference for sodium oxybate was dosing
frequency with once-nightly dosing preferred
- Presented encore posters featuring post hoc analyses from the
REST-ON study at the meeting of the American Neurological
Association
- Progressed the RESTORE open-label extension/switch study of
FT218 designed to generate long-term safety, tolerability, and
efficacy data, as well as data on switching from twice-nightly
oxybates and patient preference
- Avadel plans to present data from RESTORE study on patient
preference to once-nightly or twice-nightly dosing regimens, as
well as nocturnal experiences when using twice-nightly sodium, at
future medical congresses
Overview of Third Quarter Results
R&D expenses were $4.4 million in the quarter ended
September 30, 2021, compared to $5.6 million for the same period in
2020. The decrease on a period-over-period basis was primarily
attributed to lower clinical studies expenses and purchases of
active pharmaceutical ingredients used in the research and
development of FT218 during the current period.
SG&A expenses were $21.3 million in the quarter ended
September 30, 2021, compared to $8.4 million for the same period in
2020. The period-over-period increase is the result of a number of
factors including commercial launch planning costs related to
FT218, higher legal and professional fees, and higher compensation
costs associated with higher headcount, primarily in the areas of
commercial and medical affairs.
Income tax benefit was $5.1 million in the quarter ended
September 30, 2021, compared to income tax benefit of $5.0 million
for the same period in 2020.
Net loss for the quarter ended September 30, 2021 was $22.0
million, or ($0.38) per diluted share, compared to net loss of
$11.7 million, or ($0.20) per diluted share, for the same period in
2020.
Cash, cash equivalents and marketable securities were $181.1
million as September 30, 2021. The Company has convertible debt of
$143.8 million due in February 2023.
Conference Call
To access the conference call, investors are invited to dial
(844) 388-0559 (U.S. and Canada) or (216) 562-0393 (International).
The conference ID number is 6187211. A live audio webcast can be
accessed by visiting the investor relations section of the
Company’s website, www.avadel.com. A replay of the webcast will be
archived on Avadel’s website for 90 days following the event.
About FT218
FT218 is an investigational formulation of sodium oxybate
leveraging our proprietary drug delivery technology and designed to
be taken once at bedtime for the treatment of excessive daytime
sleepiness (EDS) or cataplexy in adults with narcolepsy.
In March 2020, Avadel completed the REST-ON study, a randomized,
double-blind, placebo-controlled, pivotal Phase 3 trial, to assess
the efficacy and safety of FT218 in patients with narcolepsy. Among
the three co-primary endpoints, FT218 demonstrated statistically
significant and clinically meaningful results in EDS, the
clinician’s overall assessment of the patient’s functioning, and
reduction in cataplexy attacks, for all three evaluated does when
compared to placebo.
In January 2018, the U.S. Food and Drug Administration (FDA)
granted FT218 Orphan Drug Designation for the treatment of
narcolepsy based on the plausible hypothesis that FT218 may be
safer than the twice-nightly formulation of sodium oxybate already
approved by the FDA due to the ramifications associated with dosing
regimen of that product. FT218 is currently under review by the
FDA.
About Avadel Pharmaceuticals plc
Avadel Pharmaceuticals plc (Nasdaq: AVDL) is a biopharmaceutical
company focused on transforming medicines to transform lives. Our
approach includes applying innovative solutions to the development
of medications that address the challenges patients face with
current treatment options. Our current lead drug candidate, FT218,
is an investigational formulation of sodium oxybate leveraging our
proprietary drug delivery technology and designed to be taken once
at bedtime for the treatment of excessive daytime sleepiness or
cataplexy in adults with narcolepsy. For more information, please
visit www.avadel.com.
Cautionary Disclosure Regarding Forward-Looking
Statements
This press release includes “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These
forward-looking statements relate to our future expectations,
beliefs, plans, strategies, objectives, results, conditions,
financial performance, prospects, or other events. Such
forward-looking statements include, but are not limited to,
expectations regarding the FDA’s review of the NDA for FT218, the
sufficiency of data supporting the NDA for FT218, the commercial
launch of FT218 (if approved), the market acceptance of FT218 (if
approved), and the advancement and expected timing of the RESTORE
study to generate long-term safety, tolerability, and efficacy data
for FT218, and the publication of data from the RESTORE study. In
some cases, forward-looking statements can be identified by the use
of words such as “will,” “may,” “could,” “believe,” “expect,” “look
forward,” “on track,” “guidance,” “anticipate,” “estimate,”
“project,” “next steps” and similar expressions, and the negatives
thereof (if applicable).
The Company’s forward-looking statements are based on estimates
and assumptions that are made within the bounds of our knowledge of
our business and operations and that we consider reasonable.
However, the Company’s business and operations are subject to
significant risks, and, as a result, there can be no assurance that
actual results and the results of the company’s business and
operations will not differ materially from the results contemplated
in such forward-looking statements. Factors that could cause actual
results to differ from expectations in the Company’s
forward-looking statements include the risks and uncertainties
described in the “Risk Factors” section of Part I, Item 1A of the
Company’s Annual Report on Form 10-K for the year ended December
31, 2020, which was filed with the Securities and Exchange
Commission (SEC) on March 9, 2021 and subsequent SEC filings.
Forward-looking statements speak only as of the date they are
made and are not guarantees of future performance. Accordingly, you
should not place undue reliance on forward-looking statements. The
Company does not undertake any obligation to publicly update or
revise our forward-looking statements, except as required by
law.
Investor Contact:Courtney TurianoStern Investor
Relations, Inc.Courtney.Turiano@sternir.com (212) 698-8687
Media Contact:Nicole Raisch GoelzReal
Chemistryngoelz@realchemistry.com (408) 568-4292
AVADEL PHARMACEUTICALS
PLCCONDENSED CONSOLIDATED STATEMENTS OF (LOSS)
INCOME(In thousands, except per share data)(Unaudited)
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
|
|
|
|
|
|
|
|
Product sales |
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
22,334 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Cost of products |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,742 |
|
|
Research and development expenses |
|
4,380 |
|
|
|
5,569 |
|
|
|
14,994 |
|
|
|
15,156 |
|
|
Selling, general and administrative expenses |
|
21,283 |
|
|
|
8,423 |
|
|
|
47,469 |
|
|
|
23,431 |
|
|
Intangible asset amortization |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
406 |
|
|
Changes in fair value of contingent consideration |
|
— |
|
|
|
(69 |
) |
|
|
— |
|
|
|
3,327 |
|
|
Gain on sale of Hospital Products |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(45,760 |
) |
|
Restructuring income |
|
— |
|
|
|
(226 |
) |
|
|
(53 |
) |
|
|
(43 |
) |
|
Total operating expense |
|
25,663 |
|
|
|
13,697 |
|
|
|
62,410 |
|
|
|
2,259 |
|
|
Operating (loss) income |
|
(25,663 |
) |
|
|
(13,697 |
) |
|
|
(62,410 |
) |
|
|
20,075 |
|
|
Investment and other income (expense), net |
|
489 |
|
|
|
213 |
|
|
|
1,531 |
|
|
|
(906 |
) |
|
Interest expense |
|
(1,929 |
) |
|
|
(3,259 |
) |
|
|
(5,788 |
) |
|
|
(9,686 |
) |
|
Gain from release of certain liabilities |
|
— |
|
|
|
— |
|
|
|
166 |
|
|
|
— |
|
|
Other expense - changes in fair value of contingent consideration
payable |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(435 |
) |
|
(Loss) income before income taxes |
|
(27,103 |
) |
|
|
(16,743 |
) |
|
|
(66,501 |
) |
|
|
9,048 |
|
|
Income tax benefit |
|
(5,101 |
) |
|
|
(5,040 |
) |
|
|
(11,473 |
) |
|
|
(9,258 |
) |
|
Net (loss) income |
|
$ |
(22,002 |
) |
|
|
$ |
(11,703 |
) |
|
|
$ |
(55,028 |
) |
|
|
$ |
18,306 |
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per share - basic |
|
$ |
(0.38 |
) |
|
|
$ |
(0.20 |
) |
|
|
$ |
(0.94 |
) |
|
|
$ |
0.36 |
|
|
Net (loss) income per share - diluted |
|
(0.38 |
) |
|
|
(0.20 |
) |
|
|
(0.94 |
) |
|
|
0.35 |
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding - basic |
|
58,585 |
|
|
|
58,213 |
|
|
|
58,506 |
|
|
|
51,206 |
|
|
Weighted average number of shares outstanding - diluted |
|
58,585 |
|
|
|
58,213 |
|
|
|
58,506 |
|
|
|
52,849 |
|
|
AVADEL PHARMACEUTICALS
PLCCONDENSED CONSOLIDATED BALANCE
SHEETS(In thousands, except per share data)
|
|
September 30, 2021 |
|
December 31, 2020 |
|
|
(unaudited) |
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
58,169 |
|
|
|
$ |
71,722 |
|
|
Marketable securities |
|
122,924 |
|
|
|
149,680 |
|
|
Research and development tax credit receivable |
|
2,493 |
|
|
|
3,326 |
|
|
Prepaid expenses and other current assets |
|
22,234 |
|
|
|
38,726 |
|
|
Total current assets |
|
205,820 |
|
|
|
263,454 |
|
|
Property and equipment, net |
|
304 |
|
|
|
359 |
|
|
Operating lease right-of-use assets |
|
2,070 |
|
|
|
2,604 |
|
|
Goodwill |
|
16,836 |
|
|
|
16,836 |
|
|
Research and development tax credit receivable |
|
961 |
|
|
|
3,445 |
|
|
Other non-current assets |
|
38,098 |
|
|
|
24,939 |
|
|
Total assets |
|
$ |
264,089 |
|
|
|
$ |
311,637 |
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Current portion of operating lease liability |
|
$ |
504 |
|
|
|
$ |
474 |
|
|
Accounts payable |
|
6,874 |
|
|
|
2,934 |
|
|
Accrued expenses |
|
8,738 |
|
|
|
6,501 |
|
|
Other current liabilities |
|
1,471 |
|
|
|
5,200 |
|
|
Total current liabilities |
|
17,587 |
|
|
|
15,109 |
|
|
Long-term debt |
|
142,086 |
|
|
|
128,210 |
|
|
Long-term operating lease liability |
|
1,460 |
|
|
|
1,840 |
|
|
Other non-current liabilities |
|
3,999 |
|
|
|
4,212 |
|
|
Total liabilities |
|
165,132 |
|
|
|
149,371 |
|
|
|
|
|
|
|
Shareholders’ equity: |
|
|
|
|
Preferred shares, nominal value of $0.01 per share; 50,000 shares
authorized; 488 issued and outstanding at September 30, 2021
and 488 issued and outstanding at December 31, 2020,
respectively |
|
5 |
|
|
|
5 |
|
|
Ordinary shares, nominal value of $0.01 per share; 500,000 shares
authorized; 58,616 issued and outstanding at September 30,
2021 and 58,396 issued and outstanding at December 31,
2020 |
|
586 |
|
|
|
583 |
|
|
Additional paid-in capital |
|
546,565 |
|
|
|
566,916 |
|
|
Accumulated deficit |
|
(425,455 |
) |
|
|
(384,187 |
) |
|
Accumulated other comprehensive loss |
|
(22,744 |
) |
|
|
(21,051 |
) |
|
Total shareholders’ equity |
|
98,957 |
|
|
|
162,266 |
|
|
Total liabilities and shareholders’ equity |
|
$ |
264,089 |
|
|
|
$ |
311,637 |
|
|
|
|
|
|
|
AVADEL PHARMACEUTICALS
PLCCONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS(In thousands)(Unaudited)
|
|
Nine Months Ended September 30, |
|
|
2021 |
|
2020 |
|
|
|
|
|
Cash flows from operating activities: |
|
|
|
|
Net (loss) income |
|
$ |
(55,028 |
) |
|
|
$ |
18,306 |
|
|
Adjustments to reconcile net (loss) income to net cash used in
operating activities: |
|
|
|
|
Depreciation and amortization |
|
614 |
|
|
|
1,297 |
|
|
Remeasurement of acquisition-related contingent consideration |
|
— |
|
|
|
3,327 |
|
|
Remeasurement of financing-related contingent consideration |
|
— |
|
|
|
435 |
|
|
Amortization of debt discount and debt issuance costs |
|
937 |
|
|
|
4,835 |
|
|
Change in deferred taxes |
|
(11,322 |
) |
|
|
(4,582 |
) |
|
Stock-based compensation expense |
|
6,088 |
|
|
|
1,705 |
|
|
Gain on the disposition of the hospital products |
|
— |
|
|
|
(45,760 |
) |
|
Gain from the release of certain liabilities |
|
(166 |
) |
|
|
— |
|
|
Other adjustments |
|
1,056 |
|
|
|
306 |
|
|
Net changes in assets and liabilities |
|
|
|
|
Accounts receivable |
|
— |
|
|
|
8,281 |
|
|
Inventories |
|
— |
|
|
|
(1,352 |
) |
|
Prepaid expenses and other current assets |
|
(54 |
) |
|
|
1,759 |
|
|
Research and development tax credit receivable |
|
3,079 |
|
|
|
2,036 |
|
|
Accounts payable & other current liabilities |
|
(201 |
) |
|
|
(4,051 |
) |
|
Accrued expenses |
|
2,421 |
|
|
|
(6,625 |
) |
|
Earn-out payments for contingent consideration in excess of
acquisition-date fair value |
|
— |
|
|
|
(5,323 |
) |
|
Royalty payments for contingent consideration payable in excess of
original fair value |
|
— |
|
|
|
(866 |
) |
|
Other assets and liabilities |
|
(2,228 |
) |
|
|
(3,337 |
) |
|
Net cash used in operating activities |
|
(54,804 |
) |
|
|
(29,609 |
) |
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
Purchases of property and equipment |
|
(26 |
) |
|
|
(33 |
) |
|
Proceeds from the disposition of the hospital products |
|
16,500 |
|
|
|
17,250 |
|
|
Proceeds from sales of marketable securities |
|
83,726 |
|
|
|
30,075 |
|
|
Purchases of marketable securities |
|
(58,591 |
) |
|
|
(124,254 |
) |
|
Net cash provided by (used in) investing activities |
|
41,609 |
|
|
|
(76,962 |
) |
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
Proceeds from the February 2020 private placement |
|
— |
|
|
|
60,570 |
|
|
Proceeds from the May 2020 public offering |
|
— |
|
|
|
116,924 |
|
|
Proceeds from stock option exercises and employee stock purchase
plan |
|
263 |
|
|
|
2,006 |
|
|
Net cash provided by financing activities |
|
263 |
|
|
|
179,500 |
|
|
|
|
|
|
|
Effect of foreign currency exchange rate changes on cash and cash
equivalents |
|
(621 |
) |
|
|
406 |
|
|
|
|
|
|
|
Net change in cash and cash equivalents |
|
(13,553 |
) |
|
|
73,335 |
|
|
Cash and cash equivalents at January 1, |
|
71,722 |
|
|
|
9,774 |
|
|
Cash and cash equivalents at September 30, |
|
$ |
58,169 |
|
|
|
$ |
83,109 |
|
|
|
|
|
|
|
|
|
|
|
|
|
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