SAN DIEGO AND VANCOUVER, Aug. 5, 2013 /CNW/ - Sophiris Bio Inc.
(Sophiris, TSX: SHS) (the "Company" or "Sophiris"), a biopharmaceutical
company developing a clinical-stage, targeted treatment for the
symptoms of benign prostatic hyperplasia (BPH or enlarged prostate),
today announced financial results and recent key operational highlights
for the three and six months ended June 30, 2013.
Recent Key Operational Highlights
-
On July 15, 2013, the Company announced the appointment of Joseph L.
Turner to its Board of Directors effective and contingent upon the
closing of the Company's proposed initial U.S. public offering of its
common shares and listing on The NASDAQ Stock Market. Mr. Turner has
more than 25 years of financial management experience in the biotech
and pharmaceutical industries. Mr. Turner currently serves on the
Board of Directors and is the chair of the audit committee of three
publicly-traded pharmaceutical companies.
-
Topsalysin was approved as the generic name for PRX302 by both the
United States Adopted Names Council (USAN) and the World Health
Organization and was published on the USAN web site and in the US
Pharmacopeia Dictionary on May 1, 2013.
-
On July 12, 2013, the Company announced the resignation of both Noah
Knauf and Amit Sobti, the Warburg Pincus nominees from its Board of
Directors. The resignation of the Warburg Pincus nominees was in
conjunction with the independent sales transaction of 50 million shares
of Sophiris' common shares from Warburg Pincus to Tavistock Life
Sciences.
Financial Results for the Second Quarter Ended June 30, 2013
The Company reported a net loss of $2.6 million ($0.02 per share) for
the three months ended June 30, 2013, compared to a net loss of $5.7
million ($0.03 per share) for the three months ended June 30, 2012,
representing a decrease of $3.1 million.
Research and Development Costs
Research and development expenses were $1.2 million for the three months
ended June 30, 2013 compared to $3.7 million for the three months ended
June 30, 2012, representing a decrease of $2.5 million. The decrease in
research and development costs is primarily attributable to a $1.5
million decrease in the costs associated with the Company's transfer
and scale-up of manufacturing activities for PRX302 and a $0.5 million
decrease in non-clinical activities, specifically a repeat dose monkey
study and a rat fertility study, both of which were completed in 2012.
Also contributing to the reduction in research and development expenses
was a decrease in consulting costs of $0.3 million. The research and
development costs included stock-based compensation charges of $0.1
million for the three months ended June 30, 2013, as compared to
approximately $43,000 for the three months ended June 30, 2012.
General and Administrative Costs
General and administrative expenses were $0.9 million for the three
months ended June 30, 2013, compared to $1.4 million for the three
months ended June 30, 2012. This decrease is primarily related to a
decrease in personnel related costs and market research costs which
were partially offset by an increase in accounting and tax professional
fees. The general and administrative costs included stock-based
compensation charges of $0.2 million for the three months ended June
30, 2013, as compared to approximately $0.1 million for the three
months ended June 30, 2012.
Interest Expense
During the three months ended June 30, 2013, the Company incurred
interest expense related to its Oxford Loan of $0.3 million, of which
$0.1 million was related to the accretion of the debt discount, as
compared to the three months ended June 30, 2012, in which the Company
incurred $0.5 million interest expense, of which $0.2 million related
to the accretion. Cash paid for interest was $0.2 million for the three
months ended June 30, 2013 as compared to $0.4 million for the same
period in 2012.
Foreign Exchange (Loss) Gain
For the three months ended June 30, 2013, the Company recorded a foreign
exchange loss of $0.3 million compared to a foreign exchange loss of
$0.2 million for the three months ended June 30, 2012.
Financial Results for the Six Months Ended June 30, 2013
The Company reported a net loss of $2.7 million ($0.02 per share) for
the six months ended June 30, 2013, compared to a net loss of $10.2
million ($0.07 per share) for the six months ended June 30, 2012,
representing a decrease of $7.5 million. The significant decrease in
the Company's net loss is primarily related to the recording of revenue
of $4.6 million associated with a non-refundable milestone payment, net
of a sub-licensing royalty fee, in connection with the Company's
licensing agreement with Kissei during the six months ended June 30,
2013. This milestone payment relates to the completion of certain
development activities as outlined in the Company's licensing agreement
with Kissei.
License Revenue
During the six months ended June 30, 2013, the Company recognized as
revenue $4.6 million, net of a sub-licensing royalty fee, associated
with a non-refundable milestone payment due upon the achievement of
certain development activities in connection with the Company's
licensing agreement for PRX302 with Kissei. The milestone payment was
recorded net of a $0.4 million sub-license royalty fee due to UVIC
Industry Partnerships Inc. and The Johns Hopkins University.
Research and Development Costs
Research and development expenses were $3.7 million for the six months
ended June 30, 2013 compared to $6.8 million for the six months ended
June 30, 2012, representing a decrease of $3.1 million. The decrease in
research and development costs is primarily attributable to a $1.0
million decrease in the costs associated with the Company's
non-clinical activities, specifically a repeat dose monkey study and a
rat fertility study, both of which were completed in 2012. In addition,
the costs associated with the transfer and scale-up of manufacturing
activities for PRX302 decreased approximately $1.8 million from the six
months ended June 30, 2012 compared to the six months ended June 30,
2013. Research and development costs included stock-based compensation
charges of $0.1 million for both the six months ended June 30, 2013 and
the six months ended June 30, 2012.
General and Administrative Costs
General and administrative expenses were $2.1 million for the six months
ended June 30, 2013, compared to $2.4 million for the six months ended
June 30, 2012. The decrease of $0.3 million is due to a reduction in
personnel related costs and marketing research costs offset partially
by an increase in accounting and tax professional fees and stock based
compensation expense. The general and administrative costs included
stock-based compensation charges of $0.4 million for the six months
ended June 30, 2013, as compared to approximately $0.3 million for the
six months ended June 30, 2012.
Interest Expense
During the six months ended June 30, 2013, the Company incurred interest
expense related to its Oxford Loan of $0.7 million, of which $0.3
million was related to the accretion of the debt discount, as compared
to the six months ended June 30, 2012, in which the Company incurred
$1.0 million interest expense, of which $0.3 million related to the
accretion. Cash paid for interest was $0.5 million for the six months
ended June 30, 2013 as compared to $0.7 million for the same period in
2012.
Foreign Exchange (Loss) Gain
For the six months ended June 30, 2013, the Company recorded a foreign
exchange loss of $0.4 million compared to a foreign exchange loss of
$0.1 million for the six months ended June 30, 2012.
Income Tax Expense
The milestone payment from Kissei was subject to a 10% Japanese
withholding tax. As a result the Company recorded income tax expense of
$0.5 million for the six months ended June 30, 2013. The Company will
be eligible to utilize the withholding tax to offset future taxes due
in Japan, if any. Given the uncertainty around the Company's ability to
generate future taxable income, the Company has expensed the
withholding tax during the six months ended June 30, 2013.
For complete financial results, please see the Company's filings at www.sedar.com.
About Sophiris
Sophiris Bio Inc. is a biopharmaceutical company developing a
clinical-stage, targeted treatment for the symptoms of benign prostatic
hyperplasia (BPH or enlarged prostate), which it believes is an
unsatisfied market with significant market potential. Sophiris' lead
candidate for BPH, PRX302, is designed to be as efficacious as
pharmaceuticals, less invasive than the surgical interventions, and
without the sexual side effects seen with existing treatments. Sophiris
is planning to begin a Phase 3 clinical trial of PRX302 in the second
half of 2013 subject to raising additional capital. For more
information, please visit www.sophirisbio.com.
Certain statements included in this press release may be considered
forward-looking. Such statements involve known and unknown risks,
uncertainties and other factors that may cause actual results,
performance or achievements to be materially different from those
implied by such statements, and therefore these statements should not
be read as guarantees of future performance or results. All
forward-looking statements are based on Sophiris' current beliefs as
well as assumptions made by and information currently available to
Sophiris and relate to, among other things, anticipated financial
performance, business prospects, strategies, regulatory developments,
market acceptance and future commitments. Readers are cautioned not to
place undue reliance on these forward-looking statements, which speak
only as of the date of this press release. Due to risks and
uncertainties, including the risks and uncertainties identified by
Sophiris in its public securities filings; actual events may differ
materially from current expectations. Sophiris disclaims any intention
or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
|
Sophiris Bio Inc.
Condensed Consolidated Interim Statement of Operations, Comprehensive
Loss and Deficit
(Stated in United States Dollars)
(unaudited)
|
|
|
|
|
|
|
|
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
License revenue, net of royalties
|
|
|
-
|
|
-
|
|
4,625,000
|
|
-
|
Expenses
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
1,154,586
|
|
3,691,683
|
|
3,650,217
|
|
6,782,857
|
General and administrative
|
|
|
879,956
|
|
1,355,881
|
|
2,126,239
|
|
2,361,706
|
|
|
|
2,034,542
|
|
5,047,564
|
|
5,776,456
|
|
9,144,563
|
|
|
|
|
|
|
|
|
|
|
Other income (expense)
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
-
|
|
36,312
|
|
-
|
|
48,662
|
Interest expense
|
|
|
(346,254)
|
|
(519,175)
|
|
(739,448)
|
|
(1,037,778)
|
Other income
|
|
|
-
|
|
-
|
|
32,000
|
|
-
|
Foreign exchange loss
|
|
|
(255,234)
|
|
(158,051)
|
|
(388,467)
|
|
(83,809)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(601,488)
|
|
(640,914)
|
|
(1,095,915)
|
|
(1,072,925)
|
|
|
|
|
|
|
|
|
|
|
Net loss for the period before income tax expense
|
|
|
(2,636,030)
|
|
(5,688,478)
|
|
(2,247,371)
|
|
(10,217,488)
|
|
|
|
|
|
|
|
-
|
|
|
Income tax expense
|
|
|
-
|
|
-
|
|
500,000
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Net loss for the period
|
|
|
(2,636,030)
|
|
(5,688,478)
|
|
(2,747,371)
|
|
(10,217,488)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
Currency translation adjustments
|
|
|
191,215
|
|
(257,296)
|
|
299,300
|
|
(103,354)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the period
|
|
|
(2,444,815)
|
|
(5,945,774)
|
|
(2,448,071)
|
|
(10,320,842)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deficit - Beginning of the period
|
|
|
(73,788,689)
|
|
(57,042,363)
|
|
(73,677,348)
|
|
(52,513,353)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deficit - End of the period
|
|
|
(76,424,719)
|
|
(62,730,841)
|
|
(76,424,719)
|
|
(62,730,841)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per share
|
|
|
(0.02)
|
|
(0.03)
|
|
(0.02)
|
|
(0.07)
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of outstanding shares-
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
|
|
|
163,793,203
|
|
163,793,203
|
|
163,793,203
|
|
153,719,943
|
|
|
|
|
|
|
|
|
|
|
|
|
Sophiris Bio Inc.
Condensed Consolidated Interim Statement of Financial Position
(Stated in United States Dollars)
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2013
$
|
|
December 31,
2012
$
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
Cash
|
|
|
3,569,844
|
|
9,720,941
|
|
Other receivables
|
78,502
|
|
71,408
|
|
Deferred financing costs
|
2,243,064
|
|
936,759
|
|
Prepaid expenses
|
247,871
|
|
447,053
|
|
|
|
|
|
|
|
6,139,281
|
|
11,176,161
|
Non-current assets
|
|
|
|
|
Property and equipment
|
123,481
|
|
162,762
|
|
Other long term assets
|
-
|
|
44,313
|
Total assets
|
6,262,762
|
|
11,383,236
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
Accounts payable and accrued liabilities
|
4,034,876
|
|
4,612,650
|
|
Current portion of secured promissory notes
|
6,180,158
|
|
5,894,566
|
|
|
|
|
|
|
|
10,215,034
|
|
10,507,216
|
|
|
|
|
|
|
|
|
|
|
Long-term secured promissory notes
|
3,100,854
|
|
6,006,360
|
|
|
|
|
|
|
|
|
|
|
Commitments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' deficit
|
|
|
|
|
Common shares
|
54,490,667
|
|
54,490,667
|
|
Common share purchase warrants
|
7,794,478
|
|
7,794,478
|
|
Contributed surplus
|
6,833,229
|
|
6,307,944
|
|
Currency translation adjustments
|
253,219
|
|
(46,081)
|
|
Deficit
|
|
(76,424,719)
|
|
(73,677,348)
|
|
Total shareholders' deficit
|
(7,053,126)
|
|
(5,130,340)
|
Total liabilities and shareholders' deficit
|
6,262,762
|
|
11,383,236
|
|
|
|
|
|
Sophiris Bio Inc.
Condensed Consolidated Interim Statement of Cash Flows
(Stated in United States Dollars)
(unaudited)
|
|
|
|
|
|
For the six months ended June 30,
|
|
|
2013
|
|
2012
|
|
|
$
|
|
$
|
|
|
|
|
|
Cash flows used in operating activities
|
|
|
|
Net loss for the period
|
(2,747,371)
|
|
(10,217,488)
|
Items not affecting cash:
|
|
|
|
|
Stock-based compensation
|
525,285
|
|
343,680
|
|
Accretion expense
|
257,660
|
|
328,796
|
|
Depreciation of property and equipment
|
42,023
|
|
40,082
|
|
Amortization of intangible assets
|
-
|
|
99,120
|
|
Unrealized foreign exchange loss (gain)
|
387,781
|
|
(301,436)
|
|
Interest expense
|
481,788
|
|
708,982
|
|
Interest income
|
-
|
|
(48,662)
|
Change in working capital:
|
|
|
|
|
Other receivables
|
23,146
|
|
154,463
|
|
Other current assets
|
(32,000)
|
|
-
|
|
Prepaid expenses
|
198,348
|
|
184,056
|
|
Other long term assets
|
44,058
|
|
(5,784)
|
|
Accounts payable and accrued liabilities
|
(817,151)
|
|
129,661
|
Net cash flows used in operating activities
|
(1,636,433)
|
|
(8,584,530)
|
|
|
|
|
|
Cash flows used in investing activities
|
|
|
|
Interest received
|
-
|
|
17,681
|
Purchase of property and equipment
|
(2,742)
|
|
(20,718)
|
Net cash flows used in investing activities
|
(2,742)
|
|
(3,037)
|
|
|
|
|
|
Cash flows (used in) provided by financing activities
|
|
|
|
Issuance of common shares in connection with private placement
|
|
|
|
|
- net of issurance costs paid
|
-
|
|
8,285,262
|
Deferred financing costs
|
(1,040,101)
|
|
-
|
Principal payments on notes payable
|
(2,877,573)
|
|
(444,940)
|
Interest paid
|
(504,569)
|
|
(712,504)
|
Net cash flows (used in) provided by financing activities
|
(4,422,243)
|
|
7,127,818
|
|
|
|
|
|
Effect of exchange rate changes on cash
|
|
|
|
|
and cash equivalents
|
(89,679)
|
|
201,790
|
Net decrease in cash and cash equivalents
|
(6,151,097)
|
|
(1,257,959)
|
|
|
|
|
|
Cash and cash equivalents - Beginning of the period
|
9,720,941
|
|
23,410,478
|
|
|
|
|
|
Cash and cash equivalents - End of the period
|
3,569,844
|
|
22,152,519
|
|
|
|
|
|
Supplemental cash flow information
|
|
|
|
|
|
|
|
|
Income taxes paid
|
500,000
|
|
-
|
|
|
|
|
SOURCE: Sophiris Bio, Inc.