SAN DIEGO, Nov. 11, 2016 (GLOBE NEWSWIRE) -- Obalon Therapeutics Inc. (NASDAQ:OBLN), a vertically integrated medical technology company with the first and only FDA-approved swallowable, gas-filled intragastric balloon system for the treatment of obesity, today announced its financial results for the third quarter ended September 30, 2016. The Company reported total revenues of $0.8 million for the third quarter, compared to $1.1 million for the third quarter of 2015. Net loss was reported at $5.3 million compared to a net loss of $3.6 million in the third quarter of 2015 and net loss per share for the quarter was $5.46 as compared to net loss per share of $6.21 in the third quarter.
Cost of goods sold was $0.6 million during the three months ended September 30, 2016, consistent with $0.6 million for the prior year period. Gross profit for the third quarter was $0.1 million, resulting in a gross margin of 17%, compared to $0.4 million and 41% for the third quarter of 2015.
Research and Development expense for the third quarter totaled $2.2 million, down from $3.2 million in the third quarter of 2015, and Selling, General and Administrative, or SG&A expense increased to $2.4 million for the third quarter, compared to $0.6 million in the third quarter 2015.
Operating loss for the third quarter was $4.5 million, compared to an operating loss of $3.4 million for the third quarter of 2015.
Net loss for the quarter was $5.3 million, or $5.46 per share as compared to a net loss of $3.6 million or $6.21 per share for third quarter of 2015.
As of September 30, 2016, Obalon had $14.2 million in cash, cash equivalents and short-term investments and $9.9 million in long-term debt.
On October 12, 2016, Obalon closed the initial public offering in which 5.0 million shares were issued at a price of $15.00 per share for gross proceeds of $75.0 million and net proceeds of approximately $67.4 million.
For the nine months ended September 30, 2016, net revenues decreased to $2.6 million from $3.1 million in the same period in the prior year.
Operating loss was $12.0 million as compared to an operating loss of $10.3 million in the prior year.
Net loss for the nine months increased to $13.0 million, or $18.36 per share, compared to a net loss of $10.7 million, or $18.71 per share, in the prior year.
A conference call to discuss third quarter 2016 results is scheduled for tomorrow, November 11, 2016, at 8:00 AM Eastern Time (5:00 AM Pacific Time). Interested parties may access the conference call by dialing (844) 889-7791 (U.S) or (661) 378-9934 (international) using passcode 7817124. Media and individuals will be in a listen-only mode. Participants are asked to dial in a few minutes prior to the call to register for the event. The conference call will also be webcast live at: http://edge.media-server.com/m/p/r6on7ba8.
A replay of the call will be available through November 18, 11:00 AM EST by calling (855) 859-2056 (U.S.) or (404) 537-3406 (international), using passcode 7817124. An archive of the webcast will be available for twelve months following the event on Obalon Therapeutics website located at http://investor.obalon.com in the “News & Events” section.
About Obalon Therapeutics, Inc.
Obalon Therapeutics, Inc. (NASDAQ:OBLN), is a San Diego-based company focused on developing and commercializing novel technologies for weight loss. The Obalon management team has over 150 combined years of experience in developing and commercializing novel medical technologies with a track record of financial and clinical excellence. For more information, please visit www.obalon.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding the benefits of the company’s product. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. Although the company believes that the expectations reflected in such forward-looking statements are reasonable, the company cannot guarantee future events, results, actions, levels of activity, performance or achievements. Forward-looking statements are subject to risks and uncertainties that may cause the company's actual activities or results to differ significantly from those expressed in any forward-looking statement, including risks and uncertainties related to the company’s ability to achieve or sustain profitability; the company’s ability to predict its future prospects and forecast its financial performance and growth; the rate at which physicians and patients adopt and use the company’s balloon system; the effect of adverse events or other negative developments involving other companies’ intragastric balloons or other obesity treatments; the company’s ability to educate physicians on safe and proper use of the Obalon balloon system; the rate at which patients may experience serious adverse device events as the result of the misuse or malfunction of, or design flaws in, the company’s products; the company’s ability to obtain FDA approval or other regulatory approvals for its future products and product improvements; the company’s ability to adequately protect its proprietary technology and maintain its issued patents and other risks and uncertainties described under the heading "Risk Factors" in documents the company files from time to time with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this press release, and the company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date hereof.
|OBALON THERAPEUTICS, INC.|
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|(in thousands, except shares and par value data)|
|Cash and cash equivalents||$||2,324||$||3,356|
|Accounts receivable, related party||515||636|
|Other current assets||2,857||273|
|Total current assets||17,963||13,803|
|Property and equipment, net||535||418|
|Liabilities, Convertible Preferred Stock and Stockholders’ Deficit|
|Accounts payable and accrued expenses||$||1,068||$||549|
|Accrued clinical expenses||139||913|
|Other current liabilities||2,434||493|
|Customer deposit from related party||—||1,283|
|Current portion of long-term loan||—||747|
|Total current liabilities||5,207||5,567|
|Long-term loan, excluding current portion||9,886||9,094|
|Commitments and contingencies (See Note 10)|
|Convertible preferred stock|
|Series A convertible preferred stock, $0.001 par value; 2,333,332 shares authorized; 804,595 shares issued and outstanding as of September 30, 2016 and December 31, 2015; liquidation preference of $7,000 as of September 30, 2016 and December 31, 2015||6,773||6,773|
|Series B convertible preferred stock, $0.001 par value; 4,333,332 shares authorized; 1,494,248 shares issued and outstanding as of September 30, 2016 and December 31, 2015; liquidation preference of $6,500 as of September 30, 2016 and December 31, 2015||6,454||6,454|
|Series C convertible preferred stock, $0.001 par value; 7,809,006 and 7,809,939 shares authorized as of September 30, 2016 and December 31, 2015, respectively; 2,668,533 shares issued and outstanding as of September 30, 2016 and December 31, 2015; liquidation preference of $16,523 as of September 30, 2016 and December 31, 2015||16,393||16,393|
|Series C-1 convertible preferred stock, $0.001 par value; 1,418,042 and 2,783,334 and shares authorized as of September 30, 2016 and December 31, 2015, respectively; 480,286 shares issued and outstanding as of September 30, 2016 and December 31, 2015; liquidation preference of $5,000 as of September 30, 2016 and December 31, 2015||4,984||4,984|
|Series D convertible preferred stock, $0.001 par value; 8,076,436 and 11,546,013 shares authorized as of September 30, 2016 and December 31, 2015, respectively; 2,732,552 shares issued and outstanding as of September 30, 2016 and December 31, 2015; liquidation preference of $20,590 and $41,180 as of September 30, 2016 and December 31, 2015, respectively||20,095||20,095|
|Series E convertible preferred stock, $0.001 par value; 10,490,611 and 0 shares authorized as of September 30, 2016 and December 31, 2015, respectively; 1,916,425 and 0 shares issued and outstanding as of September 30, 2016 and December 31, 2015, respectively; liquidation preference of $15,893 and $0 as of September 30, 2016 and December 31, 2015, respectively||15,799||—|
|Common stock, $0.001 par value; 45,000,000 and 35,000,000 shares authorized as of September 30, 2016 and December 31, 2015, respectively; 1,383,624 and 575,126 shares issued and outstanding as of September 30, 2016 and December 31, 2015, respectively||1||1|
|Additional paid-in capital||2,015||1,002|
|Other comprehensive income||5||—|
|Total stockholders’ deficit||(67,093||)||(55,139||)|
|Total liabilities and stockholders’ deficit||$||18,498||$||14,221|
|OBALON THERAPEUTICS, INC.|
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS|
|(in thousands, except shares and per share data)|
|Three Months Ended September 30,||Nine Months Ended September 30,|
|Revenue, related party||773||1,093||2,621||2,832|
|Cost of revenue||644||644||1,938||1,849|
|Research and development||2,169||3,201||7,267||9,169|
|Selling, general and administrative||2,412||618||5,387||2,297|
|Total operating expenses||4,581||3,819||12,654||11,466|
|Loss from operations||(4,452||)||(3,370||)||(11,971||)||(10,259||)|
|Interest expense, net||(135||)||(142||)||(425||)||(405||)|
|Loss from change in fair value of warrant liability||(669||)||(42||)||(550||)||(31||)|
|Other expense, net||(4||)||(8||)||(26||)||(24||)|
|Other comprehensive income (loss)||1||(2||)||5||8|
|Net loss and comprehensive loss||$||(5,259||)||$||(3,564||)||$||(12,967||)||$||(10,711||)|
|Net loss per share, basic and diluted||$||(5.46||)||$||(6.21||)||$||(18.36||)||$||(18.71||)|
|Weighted-average common shares outstanding, |
basic and diluted
|OBALON THERAPEUTICS, INC.|
|CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS|
Ended September 30,
|Adjustments to reconcile net loss to net cash used in operating activities:|
|Depreciation and amortization||142||124|
|Loss on disposal of fixed assets||13||2|
|Change in fair value of warrant liability||550||31|
|Amortization of investment premium, net||96||215|
|Amortization of debt discount||60||57|
|Change in operating assets and liabilities:|
|Accounts receivable, net||—||97|
|Accounts receivable from related party||121||(542||)|
|Other current assets||(2,597||)||(39||)|
|Accounts payable and accrued expenses||519||268|
|Accrued clinical expenses||(774||)||1,623|
|Other current liabilities||1,690||202|
|Customer deposit from related party||—||1,283|
|Net cash used in operating activities||(13,593||)||(7,175||)|
|Purchases of short-term investments||(18,897||)||(14,238||)|
|Maturities of short-term investments||16,150||11,200|
|Purchase of property and equipment||(259||)||(83||)|
|Net cash used in investing activities||(3,006||)||(3,121||)|
|Issuance of preferred stock for cash, net of offering costs||14,517||—|
|Proceeds from long-term loan, net of issuance costs||—||5,000|
|Fees paid in connection with loan amendment||(15||)||—|
|Sale of common stock||1,065||61|
|Net cash provided by financing activities||15,567||5,061|
|Effect of exchange rate changed on cash and cash equivalents||—||3|
|Net decrease in cash and cash equivalents||(1,032||)||(5,232||)|
|Cash and cash equivalents at beginning of period||3,356||6,902|
|Cash and cash equivalents at end of period||$||2,324||$||1,670|
|Supplemental cash flow information:|
|Non-cash investing and financing activities:|
|Conversion of customer deposit from related party to preferred stock||$||1,283||$||—|
For Obalon Therapeutics Inc. Investor Contact: William Plovanic Chief Financial Officer Obalon Therapeutics, Inc. Office: +1 760 607 5103 email@example.com Media: Megan Driscoll EvolveMKD Office Phone: +1 646 517 1565 firstname.lastname@example.org
Source:Obalon Therapeutics, Inc.