COPENHAGEN, Denmark, March 25, 2015 (GLOBE NEWSWIRE) -- Forward Pharma A/S (Nasdaq:FWP), today reported financial results for the fourth quarter and year ended December 31, 2014. Net loss for the fourth quarter and year ended December 31, 2014 was $2.0 million and $19.0 million, respectively. Loss per share for the fourth quarter and year ended December 31, 2014 was $1.01 and $1.79, respectively, after accounting for a non-cash preferential distribution of approximately $42.7 million. As of December 31, 2014, Forward had $223.5 million in cash, cash equivalents and marketable securities, with no debt outstanding.
"We expect 2015 to be an eventful year for Forward," said Peder Andersen, Chief Executive Officer of Forward. "After successfully raising approximately $215 million in net proceeds from our IPO in October 2014, the Company's top priorities are to continue to advance our lead drug candidate FP187 while we exploit and defend our intellectual property rights."
Fourth Quarter and Year End 2014 Financial and Operational Results
The net loss for the fourth quarter of 2014 was $2.0 million compared to a net loss of $11.0 million for the fourth quarter of 2013, as 4Q14 benefited from a $5.6 million net exchange rate gain while 4Q13 included a $8.8 million expense in connection with the fair value adjustment for shareholder warrants. The net loss for 2014 was $19.0 million compared to a net loss of $15.7 million in 2013.
Research and development expenses were $3.9 million for the fourth quarter ended December 31, 2014, compared to $1.7 million for the same period in 2013. The increase in research and development expenses was due primarily to increased FP187 patent-related costs as well as share-based compensation expense. Research and development costs for each of the years ended December 31, 2014 and 2013 were $10.5 million and $8.0 million, respectively. The $2.5 million increase in 2014 was primarily due to patent-related expenses for FP187, which increased to $4.7 million in 2014 from $1.5 million in 2013. In addition, share-based compensation expense increased to $1.8 million in 2014 compared to $579,000 in 2013. Offsetting these increases was a reduction in the use of external vendors to support our clinical development activities conducted in 2014, resulting in decreased research and development costs of $2.0 million. We expect research and development costs to increase in 2015 as we advance the clinical development of FP187 with initiation of a Phase 3 trial within the next 12 months.
General and administrative expenses were $4.0 million for the fourth quarter of 2014 versus $0.4 million for the fourth quarter of 2013. The increase in general and administrative expenses was primarily due to increased share-based compensation expense of $2.5 million and general and administrative expenses related to our becoming a public company in 2014. General and administrative expenses were approximately $9.2 million for 2014 versus $1.0 million for 2013. The $8.2 million increase in 2014 resulted primarily from costs related to the preparation for our IPO in the amount of $2.0 million as well as an increase in share-based compensation expense of $4.2 million. The remaining increase is attributable to increased personnel costs and office costs related to the opening of our U.S. subsidiary in 2014. We expect that our general and administrative costs will increase in 2015 as we expand our business, defend our intellectual property, and incur additional costs associated with operating as a public company.
Non-cash stock-based compensation expense included in total operating expenses was $2.5 million for the fourth quarter of 2014 versus $0.2 million for the fourth quarter of 2013. Non-cash stock-based compensation expense included in total operating expenses was $6.0 million for 2014 versus $579,000 million for 2013. The increase in stock-based compensation expense was due to increased hiring of key personnel in 2014.
As of December 31, 2014 and 2013, Forward had $223.5 million and $3.0 million in cash, cash equivalents and marketable securities, respectively. The net increase of $220.5 million in cash, cash equivalents and marketable securities during 2014 is primarily due to the Company's 2014 IPO.
Recent IP progress and outlook
In 2014, we made significant progress in advancing our intellectual property portfolio. The following summarizes the current status of several of our most important U.S. and European patents and patent applications.
- We are awaiting further action by the USPTO regarding our U.S. patent application No. 11/576,871. A USPTO examiner previously found our claims in this application directed to methods of treating MS using a daily 480 mg dose of DMF to be allowable and has recommended that an interference be declared against Biogen's U.S. patent No. 8,399,514.
- We have two pending U.S. patent applications relating to the 480 mg dose of DMF that we believe may soon be allowed, one of which (14/213,399) claims particular up-titration schedules of using DMF to treat MS, and the other of which (14/212,503) claims treating MS using particular compositions containing DMF and that also specifies levels of a DMF metabolite called mono methyl fumarate (MMF) in the bloodstream.
- Our erosion matrix patent issued on December 9, 2014 with patent number 8,906,420. This patent expires in January 2030 and covers the formulation of FP187.
- On November 18, 2014, we filed a lawsuit against Biogen alleging infringement of our German utility model. An oral proceeding in Germany is scheduled for February 16, 2016.
Clinical progress and outlook
Our development plan for our lead drug, FP187, includes preparation for a Phase 3 program in multiple sclerosis, psoriasis or both, as well as other clinical programs. Forward anticipates the following development activities related to clinical trials for FP187:
- continue to pursue development of FP187 for the treatment of MS and/or psoriasis and commence a Phase 3 trial within the next 12 months;
- initiate a Phase 1 bridging study to investigate the pharmacokinetic profile of a new tablet formulation of FP187; and
- initiate a Phase 1 fed/fast pharmacokinetic trial in 2Q15 which is a regulatory requirement for controlled release drugs.
About Forward Pharma:
Forward Pharma A/S is a Danish biopharmaceutical company (the "Company or "Forward Pharma") developing FP187, a proprietary formulation of DMF (dimethyl fumarate) for the treatment of inflammatory and neurological indications. Since our founding in 2005, we have worked to advance unique formulations of DMF, an immune modulator, as a therapeutic to improve the health and well-being of patients with immune disorders including multiple sclerosis. FP187, our clinical candidate, is a DMF formulation in a delayed and slow release oral dose.
Our principal executive offices are located at Østergade 24A, 1, 1100 Copenhagen K, Denmark and our American Depositary Shares are publicly traded on NASDAQ Stock Market (symbol: FWP). For more information about the Company's products and developments, please visit our web site at www.forward-pharma.com
|Forward Pharma A/S|
|Condensed Consolidated Statement of Operations|
|(in thousands, expect per share amounts)|
|Year Ended||Three Months Ended|
|December 31st||December 31st|
|Research and development||$ (10,547)||$ (8,018)||$ (3,931)||$ (1,704)|
|General and adminstrative||(9,154)||(1,014)||(3,998)||(387)|
|Total operating expenses (1)||(19,701)||(9,032)||(7,929)||(2,091)|
|Fair value adjustments||(4,791)||(6,676)||84||(8,802)|
|Foreign exchange gain||5,589||--||5,589||--|
|Net (loss) used to compute per share amounts||$ (61,750)||$ (15,696)||$ (44,705)||$ (10,982)|
|Net (loss) per ordinary share|
|Basic and diluted (2)||$ (1.79)||$ (0.54)||$ (1.01)||$ (0.38)|
|Basic and diluted||34,490||29,004||44,094||29,089|
|(1) Operating expenses include share based compensation: $6.0 million and $2.5 million for 2014 and 4Q14, respectively, versus $579,000 and $220,000 for 2013 and 4Q13, respectively.|
|(2) The net loss used to compute the per share amounts for the year and quarter ended December 31, 2014 has been increased by a non-cash preferential distribution of approximately $42.7 million.|
|Forward Pharma A/S|
|Condensed Consolidated Statement of Operations|
|Cash, cash equivalents and marketable securities||$ 223,484||$ 2,955|
|Total assets||$ 225,309||$ 3,599|
|Equity and Liabilities|
|Shareholder equity (deficit)||$ 222,394||$ (26,415)|
|Total equity and liabilities||$ 225,309||$ 3,599|
Forward Pharma A/S Media Contact:
Sharon Klahre, Director, Investor Relations
Forward Pharma USA, LLC
7 Skyline Drive
Hawthorne, NY 10532
The Ruth Group
Forward Looking Statements:
Certain statements in this press release may constitute "forward-looking statements" of the Company within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements which contain language such as "believe,""expect," "hope," "would" and "potential." Forward-looking statements are predictions only which involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from those expressed in such statements. Many such risks, uncertainties and other factors are taken into account as part of our assumptions underlying these forward-looking statements and include, among others, the following: the Company's ability to obtain, maintain and defend issued patents with protective claims; the commencement of any patent interference or infringement action; the Company's ability to prevail in or obtain a favorable decision in any such action; the Company's ability to recover damages in any such action; uncertainties relating to our development plans and activities, including the results, timing, cost and location thereof; risks and uncertainties related to the scope, validity and enforceability of our intellectual property rights in general and the impact on us of patents and other intellectual property right of third parties. These and other factors are identified and described in detail in certain of our filings with the United States Securities and Exchange Commission, including our Annual Report on Form 20-F for the year ended December 31, 2014.