Biofrontera
Inc. (Nasdaq: BFRI),
a biopharmaceutical company specializing in the commercialization
of dermatological products, today announced financial results for
the three and nine months ended September 30, 2022 and provided a
business update.
Highlights from the third quarter of 2022 and
subsequent weeks include the following:
Financial Highlights
- Total revenues for the third
quarter of 2022 were $4.3 million, consistent with the third
quarter of 2021
- Total revenues for the first nine
months of 2022 were $18.5 million, an increase of 24% from the
comparable prior-year period
- Cash and cash equivalents were
$27.5 million as of September 30, 2022, compared with $24.5 million
as of December 31, 2021
- Raised $4.3 million in net proceeds
from the exercise of existing warrants and the issuance of new
warrants through a private placement transaction
- Strengthened and aligned the
mutually beneficial relationship between Biofrontera Inc. and
Biofrontera AG through an acquisition of Biofrontera AG shares
- Adopted a limited duration
shareholder rights plan and declared a dividend distribution of
preferred stock purchase rights
Clinical and
Business Highlights
- Strengthened medical affairs
through various initiatives including seminars, medical
conferences, prescriber networking and key opinion leader (KOL)
engagement
- Showcased Ameluz® for the treatment
of actinic keratosis (AK) in four poster presentations at the 2022
Fall Clinical Dermatology Conference, where the Company also served
as a Gold Industry Sponsor
- Sponsored an Advisory Board meeting
at the Fall Clinical Dermatology Conference consisting of two
sessions that provided advanced education on the advantages and
current landscape of photodynamic therapy (PDT) and shared
real-world PDT utilization experiences by leading clinicians
- Biofrontera Bioscience GmbH was
granted a patent in Australia for novel illumination protocols
related to the treatment of skin diseases with PDT that combine the
lower pain of daylight PDT with the higher cure rates and lower
recurrence rates of conventional therapy
- Biofrontera Pharma GmbH received
notice of allowance from the United States Patent and Trademark
Office for the preparation of nanoemulsions or compositions,
describing its use in the treatment of dermatological,
virus-associated and cell proliferation diseases, as well as in
cosmetics
- Ameluz new marketing campaign
earned “Relaunch/Revitalization of the Year” and “Professional
Website/Online Initiative of the Year” awards, and Associate
Director of Marketing Leslie Hopkins was named 2022 Brand Champion
for Dermatology, all by PM360, a publication for marketing decision
markets in the pharmaceutical, biotech, diagnostics and medical
device industries
- Named Fred Leffler as Chief
Financial Officer, bringing to Biofrontera significant leadership,
financial management, consulting and operations experience
- Appointed Gerard DiGirolamo as
National Sales Director to strengthen our salesforce and execute on
our commercial plan and launch planning of BF-RhodoLED XL®
Management Commentary
“During the third quarter and recent weeks we
strengthened our medical affairs initiatives with sponsorship,
participation and presentation of our innovative dermatology
solutions. Through peer-to-peer interactions and other activities,
dermatologists are increasingly choosing our brands for their
patients. The variety of our activities and our visibility in the
dermatology sector are sharpening our corporate profile as an
innovative dermatology company and emphasizing our strong
commitment to improving patient care in collaboration with
dermatologists. Our success in strengthening patent protection for
our products justifies continued investments in marketing and
further clinical development,” stated Erica Monaco, Chief Executive
Officer of Biofrontera Inc. “Key strategic hires including a CFO
and a national sales director will support our continued success.
With year-to-date revenues up 24%, we expect total revenues for
2022 to increase between 24% and 31% compared with 2021, inclusive
of seasonal strength in the first and fourth quarters. We expect to
close 2022 with demonstrated market-share gains as well as with an
operational foundation that will position us for increased ROI in
2023.”
Third Quarter Financial
Results
Total revenues for the third quarter of 2022 of
$4.3 million were consistent with the third quarter of 2021.
Total operating expenses were $8.0 million for
the third quarter of 2022, compared with $20.4 million for the
third quarter of 2021. Cost of revenues decreased by 3% primarily
due to lower Ameluz sales. Selling, general and administrative
expenses decreased by $9.3 million, or 54%, compared with the prior
year primarily due to a one-time legal settlement expense in 2021,
partially offset by higher business insurance and headcount costs
as a result of resumed hiring in 2022.
Net loss for the third quarter of 2022 was $2.6
million, or $0.11 per share, compared with a net loss of $16.0
million, or $2.00 per share, for the third quarter of 2021.
Adjusted EBITDA was negative $5.0 million for
the third quarter of 2022, compared with negative $3.8 million for
the third quarter of 2021. Adjusted EBITDA, a non-GAAP financial
measure, is defined as net income or loss excluding interest income
and expense, income taxes, depreciation and amortization, and
certain other non-recurring or non-cash items.
Nine Month Financial
Results
Total revenues for the first nine months of 2022
were $18.5 million, compared with $14.9 million for the first nine
months of 2021. The increase of $3.6 million, or 24%, was primarily
driven by higher volume of Ameluz orders, which resulted in an
increase in Ameluz revenue of $3.2 million, and by an Ameluz price
increase, which increased Ameluz revenue by $0.2 million.
Total operating expenses were $31.5 million for
the first nine months of 2022, compared with $38.3 million for the
same period in 2021. Cost of revenues increased by 25% compared
with the prior-year period primarily due to higher sales of Ameluz.
Selling, general and administrative expenses decreased by $2.3
million, or 8%, primarily due to a one-time legal settlement
expense in 2021, partially offset by higher business insurance and
headcount costs as a result of resumed hiring in 2022.
Net income for the first nine months of 2022 was
$2.1 million, or $0.11 per diluted share, compared with net loss of
$23.2 million, or $2.90 per share, for the first nine months of
2021.
Adjusted EBITDA was negative $14.1 million for
the first nine months of 2022, compared with negative $9.5 million
for the same period in 2021.
The below table presents a reconciliation of net
income (loss) to adjusted EBITDA for the three and nine months
ended September 30, 2022 and 2021:
|
|
Three months endedSeptember
30, |
|
|
Nine months endedSeptember
30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Net income
(loss) |
|
$ |
(2,566 |
) |
|
$ |
(16,012 |
) |
|
$ |
2,145 |
|
|
$ |
(23,208 |
) |
Interest expense, net |
|
|
89 |
|
|
|
86 |
|
|
|
160 |
|
|
|
255 |
|
Income tax expense |
|
|
1 |
|
|
|
6 |
|
|
|
31 |
|
|
|
51 |
|
Depreciation and amortization |
|
|
130 |
|
|
|
134 |
|
|
|
394 |
|
|
|
409 |
|
EBITDA |
|
|
(2,346 |
) |
|
|
(15,786 |
) |
|
|
2,730 |
|
|
|
(22,493 |
) |
Change in fair value of contingent consideration |
|
|
(2,200 |
) |
|
|
700 |
|
|
|
(4,100 |
) |
|
|
1,698 |
|
Change in fair value of warrant liabilities |
|
|
(1,185 |
) |
|
|
- |
|
|
|
(15,267 |
) |
|
|
- |
|
Legal settlement expenses |
|
|
- |
|
|
|
11,250 |
|
|
|
- |
|
|
|
11,250 |
|
Stock-based compensation |
|
|
400 |
|
|
|
- |
|
|
|
1,469 |
|
|
|
- |
|
Expensed issuance costs |
|
|
320 |
|
|
|
- |
|
|
|
1,045 |
|
|
|
- |
|
Adjusted EBITDA |
|
$ |
(5,011 |
) |
|
$ |
(3,836 |
) |
|
$ |
(14,123 |
) |
|
$ |
(9,545 |
) |
Adjusted EBITDA margin |
|
|
-115.9 |
% |
|
|
-88.5 |
% |
|
|
-76.2 |
% |
|
|
-63.9 |
% |
As of September 30, 2022, Biofrontera Inc. had
cash and cash equivalents of $27.5 million, compared with $24.5
million as of December 31, 2021. The Company believes its cash and
cash equivalents are sufficient to fund operations for at least the
next 12 months.
Financial Guidance
Biofrontera Inc. is revising its previously
announced financial guidance for 2022, as follows:
- Total revenues for 2022 are
expected to increase between 24% and 31% compared with 2021,
including typical seasonal strength in the first and fourth
quarters
- The commercial focus throughout
2022 will be on achieving deeper sales penetration among current
customer accounts and increasing market share.
Conference Call and Webcast
Biofrontera Inc. will hold a conference call
today at 11:00 a.m. Eastern time to discuss these results and
answer questions.
Date: |
Monday, November 14, 2022 |
Time: |
11:00 a.m. Eastern time |
Conference call: |
877-877-1275 (U.S.)412-858-5202 (international) |
Webcast: |
Live and 90-day replay webcast are available here and at
investors.biofrontera-us.com |
|
|
About Biofrontera Inc.
Biofrontera Inc. is a U.S.-based
biopharmaceutical company commercializing a portfolio of
pharmaceutical products for the treatment of dermatological
conditions with a focus on photodynamic therapy (PDT) and topical
antibiotics. The Company’s licensed products are used for the
treatment of actinic keratoses, which are pre-cancerous skin
lesions, as well as impetigo, a bacterial skin infection. For more
information, visit www.biofrontera-us.com.
Forward-Looking Statements
Certain statements in this press release may
constitute "forward-looking statements" within the meaning of the
United States Private Securities Litigation Reform Act of 1995, as
amended to date. These statements include, but are not limited to,
statements relating to the Biofrontera Inc.’s (the “Company”)
revenue guidance for 2022, the Company’s relationship with
Biofrontera AG (including beneficial ownership of Biofrontera AG’s
shares and future collaboration between the Company and Biofrontera
AG), business and marketing strategy, hiring strategy, development
of medical affairs initiatives, growth of the Company’s profile,
future operations and business, increased patent protection for our
licensed products, potential to expand the label of Ameluz®, market
presence and position of Ameluz® and ongoing clinical trials
conducted by our licensing partners and the future impact of such
trials on the market for Ameluz®. We have based these
forward-looking statements on our current expectations and
projections about future events, nevertheless, actual results or
events could differ materially from the plans, intentions and
expectations disclosed in, or implied by, the forward-looking
statements we make. These risks and uncertainties, many of which
are beyond our control, including, but not limited to, the impact
of extraordinary external events, such as the current COVID-19
pandemic; any changes in the Company’s relationship with its
licensors; the ability of the Company’s licensors to fulfill their
obligations to the Company in a timely manner; the Company’s
ability to achieve and sustain profitability; whether the current
global disruptions in supply chains will impact the Company’s
ability to obtain and distribute its licensed products; changes in
the practices of healthcare providers, including any changes to the
coverage, reimbursement and pricing for procedures using the
Company’s licensed products; the uncertainties inherent in the
initiation and conduct of clinical trials; availability and timing
of data from clinical trials; whether results of earlier clinical
trials or trials of Ameluz® in combination with BF-RhodoLED® in
different disease indications or product applications will be
indicative of the results of ongoing or future trials;
uncertainties associated with regulatory review of clinical trials
and applications for marketing approvals; whether the market
opportunity for Ameluz® in combination with BF-RhodoLED® is
consistent with the Company’s expectations; the Company’s ability
to complete the transition to a public company; the Company’s
ability to retain and hire key personnel; the sufficiency of cash
resources and need for additional financing and other factors that
may be disclosed in the Company’s filings with the SEC, which can
be obtained on the SEC website at www.sec.gov. Readers are
cautioned not to place undue reliance on the forward-looking
statements, which speak only as of the date on which they are made
and reflect management's current estimates, projections,
expectations and beliefs. The Company does not plan to update any
such forward-looking statements and expressly disclaims any duty to
update the information contained in this press release except as
required by law.
Contacts:
Biofrontera Inc.Anke zur
Mühlen+1 781 486 1539us-ir@biofrontera.com
LHA Investor RelationsTirth T.
Patel+1 212 201 6614tpatel@lhai.com
BIOFRONTERA
INC.CONSOLIDATED BALANCE
SHEETS(In thousands, except par
value and share amounts)
|
|
September 30, 2022 |
|
|
December 31, 2021 |
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
27,518 |
|
|
$ |
24,545 |
|
Accounts receivable, net |
|
|
1,562 |
|
|
|
3,784 |
|
Other receivables, related party |
|
|
3,503 |
|
|
|
8,647 |
|
Inventories |
|
|
12,087 |
|
|
|
4,458 |
|
Prepaid expenses and other current assets |
|
|
3,823 |
|
|
|
4,987 |
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
48,493 |
|
|
|
46,421 |
|
|
|
|
|
|
|
|
|
|
Other receivables long term, related party |
|
|
2,813 |
|
|
|
2,813 |
|
Property and equipment, net |
|
|
224 |
|
|
|
267 |
|
Intangible asset, net |
|
|
3,136 |
|
|
|
3,450 |
|
Other assets |
|
|
393 |
|
|
|
268 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
55,059 |
|
|
$ |
53,219 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
253 |
|
|
$ |
658 |
|
Accounts payable, related parties |
|
|
4,206 |
|
|
|
282 |
|
Acquisition contract liabilities, net |
|
|
3,242 |
|
|
|
3,242 |
|
Accrued expenses and other current liabilities |
|
|
9,442 |
|
|
|
9,654 |
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
17,143 |
|
|
|
13,836 |
|
|
|
|
|
|
|
|
|
|
Long-term liabilities: |
|
|
|
|
|
|
|
|
Acquisition contract liabilities, net |
|
|
5,711 |
|
|
|
9,542 |
|
Warrant liability |
|
|
3,964 |
|
|
|
12,854 |
|
Other liabilities |
|
|
5,646 |
|
|
|
5,649 |
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
$ |
32,464 |
|
|
$ |
41,881 |
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies (see Note 23) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
Preferred Stock, $0.001 par value, 20,000,000 shares authorized,
zero shares issued and outstanding as of September 30, 2022, and
December 31, 2021 |
|
$ |
- |
|
|
$ |
- |
|
Common Stock, $0.001 par value, 300,000,000 shares authorized;
23,550,960 and 17,104,749 shares issued and outstanding as of
September 30, 2022, and December 31, 2021 |
|
|
23 |
|
|
|
17 |
|
Additional paid-in capital |
|
|
99,306 |
|
|
|
90,200 |
|
Accumulated deficit |
|
|
(76,734 |
) |
|
|
(78,879 |
) |
|
|
|
|
|
|
|
|
|
Total stockholders’ equity |
|
|
22,595 |
|
|
|
11,338 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders’ equity |
|
$ |
55,059 |
|
|
$ |
53,219 |
|
BIOFRONTERA
INC.CONSOLIDATED STATEMENTS OF
OPERATIONS(In thousands, except
per share amounts and number of
shares)(Unaudited)
|
|
Three months endedSeptember
30, |
|
|
Nine months endedSeptember
30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Products revenues, net |
|
$ |
4,290 |
|
|
$ |
4,319 |
|
|
$ |
18,467 |
|
|
$ |
14,890 |
|
Revenues, related party |
|
|
32 |
|
|
|
15 |
|
|
|
63 |
|
|
|
42 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues, net |
|
|
4,322 |
|
|
|
4,334 |
|
|
|
18,530 |
|
|
|
14,932 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues, related party |
|
|
2,127 |
|
|
|
2,249 |
|
|
|
9,504 |
|
|
|
7,630 |
|
Cost of revenues, other |
|
|
98 |
|
|
|
41 |
|
|
|
425 |
|
|
|
339 |
|
Selling, general and administrative |
|
|
7,765 |
|
|
|
17,090 |
|
|
|
25,050 |
|
|
|
27,412 |
|
Selling, general and administrative, related party |
|
|
171 |
|
|
|
160 |
|
|
|
612 |
|
|
|
520 |
|
Restructuring costs |
|
|
- |
|
|
|
199 |
|
|
|
- |
|
|
|
654 |
|
Change in fair value of contingent consideration |
|
|
(2,200 |
) |
|
|
700 |
|
|
|
(4,100 |
) |
|
|
1,698 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
|
7,961 |
|
|
|
20,439 |
|
|
|
31,491 |
|
|
|
38,253 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(3,639 |
) |
|
|
(16,105 |
) |
|
|
(12,961 |
) |
|
|
(23,321 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of warrants |
|
|
1,185 |
|
|
|
- |
|
|
|
15,267 |
|
|
|
- |
|
Interest expense, net |
|
|
(89 |
) |
|
|
(86 |
) |
|
|
(160 |
) |
|
|
(255 |
) |
Other income (expense), net |
|
|
(22 |
) |
|
|
185 |
|
|
|
30 |
|
|
|
419 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other income (expense) |
|
|
1,074 |
|
|
|
99 |
|
|
|
15,137 |
|
|
|
164 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income taxes |
|
|
(2,566 |
) |
|
|
(16,006 |
) |
|
|
2,176 |
|
|
|
(23,157 |
) |
Income tax expense |
|
|
1 |
|
|
|
6 |
|
|
|
31 |
|
|
|
51 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(2,566 |
) |
|
$ |
(16,012 |
) |
|
$ |
2,145 |
|
|
$ |
(23,208 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.11 |
) |
|
$ |
(2.00 |
) |
|
$ |
0.11 |
|
|
$ |
(2.90 |
) |
Diluted |
|
$ |
(0.11 |
) |
|
$ |
(2.00 |
) |
|
$ |
0.11 |
|
|
$ |
(2.90 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
22,725,821 |
|
|
|
8,000,000 |
|
|
|
19,560,351 |
|
|
|
8,000,000 |
|
Diluted |
|
|
22,725,821 |
|
|
|
8,000,000 |
|
|
|
19,605,014 |
|
|
|
8,000,000 |
|
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