QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(IRS Employer Identification No.) | |
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(Address of principal executive offices) |
(Zip Code) |
Title of Each Class |
Ticker Symbol |
Name of Exchange on Which Registered |
Large accelerated filer | ☐ | ☒ | ||||
Non-accelerated filer |
☐ | Smaller reporting company | ||||
Emerging growth company |
PART I. FINANCIAL INFORMATION |
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Item 1. |
FINANCIAL STATEMENTS |
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3 |
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4 |
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5 |
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6 |
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7 |
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Item 2. |
24 |
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Item 3. |
35 |
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Item 4. |
36 |
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PART II. OTHER INFORMATION |
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Item 1. |
36 |
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Item 1A. |
37 |
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Item 2. |
38 |
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Item 3. |
38 |
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Item 4. |
38 |
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Item 5. |
38 |
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Item 6. |
38 |
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39 |
June 30, 2021 |
December 31, 2020 |
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(unaudited) |
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ASSETS |
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Current Assets: |
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Cash and cash equivalents |
$ | $ | ||||||
Short-term investments |
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Accounts receivable, net |
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Inventory |
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Prepaid expenses and other current assets |
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Total current assets |
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Operating lease right-of-use |
— | |||||||
Property and equipment, net |
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Deferred tax assets |
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Deposits |
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Total assets |
$ | $ | ||||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current Liabilities: |
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Accounts payable |
$ | $ | ||||||
Accrued expenses and other liabilities |
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Total current liabilities |
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Operating lease liability, net of current portion |
— | |||||||
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Total liabilities |
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Commitments and contingencies (Note 10) |
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Stockholders’ equity: |
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Preferred stock, $ |
— | |||||||
Common stock, $ shares outstanding at June 30, 2021 and December 31, 2020, respectively |
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Additional paid-in capital |
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Accumulated deficit |
( |
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Accumulated other comprehensive income (loss) |
( |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity |
$ | $ | ||||||
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For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
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2021 |
2020 |
2021 |
2020 |
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Revenues: |
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Product revenue, net |
$ | $ | $ | $ | ||||||||||||
License and other revenue |
— | — | ||||||||||||||
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Total revenues |
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Operating costs and expenses: |
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s |
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Research and development |
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Selling, general and administrative |
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Total operating costs and expenses |
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Operating income |
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Other income, net |
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Net income before income taxes |
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Provision for income taxes |
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Net income |
$ | $ | $ | $ | ||||||||||||
Net income per share: |
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Basic |
$ | $ | $ | $ | ||||||||||||
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Diluted |
$ | $ | $ | $ | ||||||||||||
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Weighted average shares outstanding: |
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Basic |
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Diluted |
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Net income |
$ | $ | $ | $ | ||||||||||||
Other comprehensive income: |
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Unrealized gain (loss) on available-for-sale |
( |
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) | ( |
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Comprehensive income |
$ | $ | $ | $ | ||||||||||||
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Preferred Stock |
Common Stock |
Additional Paid-in Capital |
Accumulated Deficit |
Accumulated Other Comprehensive Gain (Loss) |
Total |
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Shares |
Amount |
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Balance at December 31, 2020 |
$ | — | $ | $ | $ | ( |
) | $ | $ | |||||||||||||||||||
Issuance of stock options for services |
— | — | — | — | — | |||||||||||||||||||||||
Exercise of stock options for common stock |
— | — | — | — | ||||||||||||||||||||||||
Amortization of restricted stock for services |
— | — | — | — | — | |||||||||||||||||||||||
Repurchase of common stock |
— | ( |
) | — | — | ( |
) | — | ( |
) | ||||||||||||||||||
Other comprehensive gain (loss) |
— | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||
Net income |
— | — | — | — | — | |||||||||||||||||||||||
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Balance at March 31, 2021 |
— | ( |
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Issuance of stock options for services |
— | — | — | — | — | |||||||||||||||||||||||
Exercise of stock options for common stock |
— | — | — | — | ||||||||||||||||||||||||
Amortization of restricted stock for services |
— | — | — | — | — | |||||||||||||||||||||||
Repurchase of common stock |
— | ( |
) | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||
Issuance of common stock upon vesting of restricted stock units, net |
— | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||
Other comprehensive gain (loss) |
— | — | — | — | — | |||||||||||||||||||||||
Net income |
— | — | — | — | — | |||||||||||||||||||||||
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Balance at June 30, 2021 |
$ | — | $ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||||
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Preferred Stock |
Common Stock |
Additional Paid-in Capital |
Accumulated Deficit |
Accumulated Other Comprehensive Gain (Loss) |
Total |
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Shares |
Amount |
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Balance at December 31, 2019 |
$ | — | $ | $ | $ | ( |
) | $ | $ | |||||||||||||||||||
Issuance of stock options for services |
— | — | — | — | — | |||||||||||||||||||||||
Exercise of stock options for common stock |
— | — | — | — | ||||||||||||||||||||||||
Amortization of restricted stock for services |
— | — | — | — | — | |||||||||||||||||||||||
Other comprehensive gain (loss) |
— | — | — | — | — | |||||||||||||||||||||||
Net income |
— | — | — | — | — | |||||||||||||||||||||||
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Balance at March 31, 2020 |
— | ( |
) | |||||||||||||||||||||||||
Issuance of stock options for services |
— | — | — | — | — | |||||||||||||||||||||||
Exercise of stock options for common stock |
— | — | — | — | ||||||||||||||||||||||||
Amortization of restricted stock for services |
— | — | — | — | — | |||||||||||||||||||||||
Other comprehensive gain (loss) |
— | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||
Net income |
— | — | — | — | — | |||||||||||||||||||||||
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Balance at June 30, 2020 |
$ | — | $ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||||
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For the Six Months Ended June 30, |
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2021 |
2020 |
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Operating Activities: |
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Net income |
$ | $ | ||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
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Depreciation |
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Stock-based compensation |
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Deferred taxes |
— | |||||||
Change in accrued interest and accretion of discount on investments |
( |
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) | ||||
Reduction in the carrying amount of right-of-use asset |
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(Increase) decrease in: |
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Accounts receivable, net |
( |
) | ||||||
Inventory |
( |
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Prepaid expenses and other current assets and deposits |
( |
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Increase (decrease) in: |
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Accounts payable |
( |
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Accrued expenses and other liabilities |
( |
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Operating lease liability |
( |
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Net cash provided by (used in) operating activities |
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Investing Activities: |
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Purchases of property and equipment |
( |
) | — | |||||
Purchases of investments |
( |
) | — | |||||
Proceeds from maturities and sales of investments |
— | |||||||
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Net cash provided by (used in) investing activities |
( |
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Financing Activities: |
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Payment of employee withholding tax related to stock-based compensation |
( |
) | — | |||||
Proceeds from exercise of stock options |
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Repurchase of common stock |
( |
) | — | |||||
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Net cash provided by (used in) financing activities |
( |
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Net increase (decrease) in cash and cash equivalents |
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Cash and cash equivalents—beginning of period |
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Cash and cash equivalents—end of period |
$ | $ | ||||||
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Supplemental disclosures of cash flow information: |
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Cash paid for income taxes |
$ | $ | ||||||
Non-cash investing and financing activities: |
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Unrealized gain (loss) on available-for-sale |
$ | ( |
) | $ | ( |
) | ||
Operating lease liabilities arising from obtaining right-of-use |
$ | $ | — |
1. |
Organization and Description |
2. |
Basis of Presentation and Significant Accounting Policies. |
a. |
INTERIM FINANCIAL STATEMENTS. 10-Q was derived from the audited financial statements and does not include all disclosures required by U.S. GAAP. |
2. |
Basis of Presentation and Significant Accounting Policies (continued). |
b. |
PRINCIPLES OF CONSOLIDATION |
c. |
USE OF ESTIMATES. |
d. |
CASH AND CASH EQUIVALENTS. |
e. |
INVESTMENTS |
f. |
ACCOUNTS RECEIVABLE, NET. |
2. |
Basis of Presentation and Significant |
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g. |
INVENTORY. work-in-process first-in, first out (FIFO) flow of goods. The Company began capitalizing inventories post FDA approval of Firdapse® on November 28, 2018 as the related costs were expected to be recoverable through the commercialization of the product. Costs incurred prior to the FDA approval of Firdapse® were recorded as research and development expenses in prior years’ consolidated statements of operations and comprehensive income. If information becomes available that suggests that inventories may not be realizable, the Company may be required to expense a portion or all of the previously capitalized inventories. As of June 30, 2021 inventory consisted of raw materials, work-in process and finished goods. As of December 31, 2020, inventory consisted mainly of work-in-process |
h. |
PREPAID EXPENSES AND OTHER CURRENT ASSETS. pre-clinical studies, clinical trials and studies, regulatory affairs and consulting. Prepaid manufacturing consists of advances for the Company’s drug manufacturing activities. Such advances are recorded as expense as the related goods are received or the related services are performed. |
i. |
FAIR VALUE OF FINANCIAL INSTRUMENTS. |
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j. |
FAIR VALUE MEASUREMENTS. |
2. |
Basis of Presentation and Significant Accounting Policies (continued). |
Fair Value Measurements at Reporting Date Using (in thousands) |
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Balances as of June 30, 2021 |
Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) |
Significant Other Observable Inputs (Level 2) |
Significant Unobservable Inputs (Level 3) |
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Cash and cash equivalents: |
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Money market funds |
$ | $ | $ | — | $ | — | ||||||||||
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U.S. Treasuries |
$ | $ | $ | — | $ | — | ||||||||||
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Short-term investments: |
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Short-term bond funds |
$ | $ | $ | — | $ | — | ||||||||||
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Balances as of December 31, 2020 |
Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) |
Significant Other Observable Inputs (Level 2) |
Significant Unobservable Inputs (Level 3) |
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Cash and cash equivalents: |
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Money market funds |
$ | $ | $ | — | $ | — | ||||||||||
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U.S. Treasuries |
$ | $ | — | $ | $ | — | ||||||||||
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Short-term investments: |
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Short-term bond funds |
$ | $ | $ | — | $ | — | ||||||||||
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k. |
OPERATING LEASES. right-of-use non-lease components, which are accounted for separately. |
l. |
SHARE REPURCHASES. |
m. |
REVENUE RECOGNITION. |
2. |
Basis of Presentation and |
2. |
Basis of Presentation and Significant Accounting Policies (continued). |
2. |
Basis of Presentation |
2. |
Basis of Presentation and Significant Accounting Policies (continued). |
n. |
RESEARCH AND DEVELOPMENT. |
o. |
STOCK-BASED COMPENSATION. |
p. |
CONCENTRATION OF RISK. |
2. |
Basis of Presentation and Significant Accounting Policies (continued). |
q. |
ROYALTIES. |
r. |
INCOME |
s. |
COMPREHENSIVE INCOME. available-for-sale |
t. |
NET INCOME PER COMMON SHARE. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
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2021 |
2020 |
2021 |
2020 |
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Basic weighted average common shares outstanding |
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Effect of dilutive securities |
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Diluted weighted average common shares outstanding |
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2. |
Basis of Presentation and Significant Accounting Policies (continued). |
u. |
RECLASSIFICATIONS. |
v. |
RECENTLY ISSUED ACCOUNTING STANDARDS. 2019-12, Income Taxes: Simplifying the Accounting for Income Taxes step-up in the tax basis of goodwill. The standard was effective for annual periods beginning after December 15, 2020 and interim periods within, with early adoption permitted. Adoption of the standard required certain changes to be made prospectively, with some changes to be made retrospectively. The Company adopted the new standard on January 1, 2021. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements. |
3. |
Investments. |
Estimated Fair Value |
Gross Unrealized Gains |
Gross Unrealized Losses |
Amortized Cost |
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At June 30, 2021: |
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U.S. Treasuries – Cash equivalents |
$ | $ | $ | ( |
) |
$ | ||||||||||
Short-term bond funds |
— | ( |
) | |||||||||||||
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Total |
$ | $ | $ | ( |
) | $ | ||||||||||
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At December 31, 2020: |
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U.S. Treasuries – Cash equivalents |
$ | $ | $ | — | $ | |||||||||||
Short-term bond funds |
— | |||||||||||||||
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Total |
$ | $ | $ | — | $ | |||||||||||
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June 30, 2021 |
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Due in one year or less |
$ |
4. |
Inventory, net. |
June 30, 2021 |
December 31, 2020 |
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Raw materials |
$ | $ | — | |||||
Work-in-process |
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Finished goods |
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Total inventory, net |
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$ |
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$ | ||||
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5. |
Prepaid Expenses and |
June 30, 2021 |
December 31, 2020 |
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Prepaid manufacturing costs |
$ | $ | ||||||
Prepaid tax |
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Prepaid insurance |
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Prepaid subscription fees |
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Prepaid research fees |
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Prepaid commercialization expenses |
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Due from collaborative and licensing arrangements |
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Other |
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Total prepaid expenses and other current assets |
$ | $ | ||||||
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6. |
Operating Lease. |
For the three months ended June 30, 2021 |
For the six months ended June 30, 2021 |
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Operating lease cost |
$ | $ |
June 30, 2021 |
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Cash paid for amounts included in the measurement of lease liabilities: |
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Operating cash flows |
$ | |||
Right-of-use |
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Operating leases |
$ |
Operating lease right-of-use |
$ |
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Other current liabilities |
$ | |||
Operating lease liabilities, net of current portion |
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Total operating lease liabilities |
$ | |||
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Remaining lease term |
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Discount rate |
% |
6. |
Operating Lease (continued). |
2021 (remaining six months) |
$ | |||
2022 |
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2023 |
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2024 |
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2025 |
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Thereafter |
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Total lease payments |
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Less imputed interest |
( |
) | ||
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Total |
$ | |||
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7. |
Property and Equipment, net. |
June 30, 2021 |
December 31, 2020 |
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Computer equipment |
$ | $ | ||||||
Furniture and equipment |
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Leasehold improvements |
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Less: Accumulated depreciation |
( |
) | ( |
) | ||||
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Total property and equipment, net |
$ | $ | ||||||
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8. |
Accrued Expenses and Other Liabilities. |
June 30, 2021 |
December 31, 2020 |
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Accrued preclinical and clinical trial expenses |
$ | $ | ||||||
Accrued professional fees |
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Accrued compensation and benefits |
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Accrued license fees |
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Accrued purchases |
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Accrued contributions |
— | |||||||
Operating lease liability |
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Accrued variable consideration |
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Accrued income tax |
— | |||||||
Other |
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Current accrued expenses and other liabilities |
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Lease liability—non-current |
— | |||||||
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Non-current accrued expenses and other liabilities |
— | |||||||
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Total accrued expenses and other liabilities |
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$ |
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$ | ||||
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9. |
Collaboration |
9. |
Collaboration and Licensing Arrangements (continued). |
10. |
Commitments and Contingencies. |
10. |
Commitments and |
11. |
Agreements. |
a. |
LICENSE AGREEMENT FOR FIRDAPSE ® .On ® . Under the license agreement, the Company pays: (i) royalties to the licensor for ® equal to ® equal to |
b. |
AGREEMENTS FOR DRUG MANUFACTURING, DEVELOPMENT, PRECLINICAL AND CLINICAL STUDIES. |
12. |
Income Taxes. |
13. |
Stockholders’ Equity. |
14. |
Stock Compensation. |
Three months ended June 30, |
Six months ended June 30, |
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2021 |
2020 |
2021 |
2020 |
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Research and development |
$ | $ | $ | $ | ||||||||||||
Selling, general and administrative |
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Total stock-based compensation |
$ | $ | $ | $ | ||||||||||||
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14. |
Stock Compensation (continued). |
15. |
Subsequent |
ITEM 2. |
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
• |
Overview. |
• |
Basis of Presentation. |
• |
Critical Accounting Policies and Estimates. |
• |
Results of Operations. |
• |
Liquidity and Capital Resources. off-balance sheet arrangements and our outstanding commitments, if any. |
• |
Caution Concerning Forward-Looking Statements. |
Three months ended June 30, |
Change |
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2021 |
2020 |
$ |
% |
|||||||||||||
Research and development expenses |
$ | 4,074 | $ | 3,929 | 145 | 3.7 | % | |||||||||
Employee stock-based compensation |
376 | 421 | (45 | ) | (10.7 | )% | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total research and development expenses |
$ | 4,450 | $ | 4,350 | 100 | 2.3 | % | |||||||||
|
|
|
|
|
|
|
|
Six months ended June 30, |
Change |
|||||||||||||||
2021 |
2020 |
$ |
% |
|||||||||||||
Research and development expenses |
$ | 6,692 | $ | 7,734 | (1,042 | ) | (13.5 | )% | ||||||||
Employee stock-based compensation |
765 | 839 | (74 | ) | (8.8 | )% | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total research and development expenses |
$ | 7,457 | $ | 8,573 | (1,116 | ) | (13.0 | )% | ||||||||
|
|
|
|
|
|
|
|
Three months ended June 30, |
Change |
|||||||||||||||
2021 |
2020 |
$ |
% |
|||||||||||||
Selling |
$ | 5,981 | $ | 5,622 | 359 | 6.4 | % | |||||||||
General and administrative |
4,409 | 3,838 | 571 | 14.9 | % | |||||||||||
Employee stock-based compensation |
1,142 | 1,373 | (231 | ) | (16.8 | )% | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total selling, general and administrative expenses |
$ | 11,532 | $ | 10,833 | 699 | 6.5 | % | |||||||||
|
|
|
|
|
|
|
|
Six months ended June 30, |
Change |
|||||||||||||||
2021 |
2020 |
$ |
% |
|||||||||||||
Selling |
$ | 11,657 | $ | 11,425 | 232 | 2.0 | % | |||||||||
General and administrative |
10,267 | 6,996 | 3,271 | 46.8 | % | |||||||||||
Employee stock-based compensation |
2,324 | 2,475 | (151 | ) | (6.1 | )% | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total selling, general and administrative expenses |
$ | 24,248 | $ | 20,896 | 3,352 | 16.0 | % | |||||||||
|
|
|
|
|
|
|
|
• | the extent to which we seek to acquire or in-license additional drug development candidates; |
• | the scope, rate of progress and cost of our clinical trials and other product development activities; |
• | future clinical trial results; |
• | the terms and timing of any collaborative, licensing and other arrangements that we may establish; |
• | the cost and timing of regulatory approvals; |
• | the cost and delays in product development as a result of any changes in regulatory oversight applicable to our products; |
• | the level of revenues that we report from sales of Firdapse ® ; |
• | the effect of competition and market developments; and |
• | the cost of filing and potentially prosecuting, defending and enforcing any patent claims and other intellectual property rights. |
• | Payments under our license agreement |
• | Royalties to our licensor for seven years from the first commercial sale of Firdapse ® equal to 7% of net sales (as defined in the License Agreement) in North America for any calendar year for sales up to $100 million, and 10% of net sales in North America in any calendar year in excess of $100 million; and |
• | Royalties to the third-party licensor of the rights sublicensed to us from the first commercial sale of Firdapse ® equal to 7% of net sales (as defined in the License Agreement between BioMarin and the third-party licensor) in any calendar year for the duration of regulatory exclusivity within a territory and 3.5% for territories in any calendar year in territories without regulatory exclusivity. |
• | Employment agreements |
• | Purchase commitment. |
• | Lease for office space |
• | The impact of the COVID-19 pandemic on our business or on the economy generally; |
• | Whether we will be able to continue to successfully market Firdapse ® while maintaining full compliance with applicable federal and state laws, rules and regulations; |
• | Whether our estimates of the size of the market for Firdapse ® for the treatment of Lambert-Eaton Myasthenic Syndrome (“LEMS”) will turn out to be accurate; |
• | Whether we will be able to locate LEMS patients who are undiagnosed or are misdiagnosed with other diseases; |
• | Whether patients will discontinue from the use of our drug at rates that are higher than historically experienced or are higher than we project; |
• | Whether the daily dose taken by patients changes over time and affects our results of operations; |
• | Whether Firdapse ® patients can be successfully titrated to stable therapy; |
• | Whether we can continue to market Firdapse ® on a profitable and cash flow positive basis; |
• | Whether any revenue guidance that we provide to the public market will turn out to be accurate; |
• | Whether payors will reimburse for our product at the price that we charge for the product; |
• | The ability of our third-party suppliers and contract manufacturers to maintain compliance with current Good Manufacturing Practices (cGMP); |
• | The ability of our distributor and the specialty pharmacies that distribute our product to maintain compliance with applicable law; |
• | Our ability to maintain compliance with applicable rules relating to our patient assistance programs and our contributions to 501(c)(3) organizations that support LEMS patients; |
• | The scope of our intellectual property and the outcome of any future challenges or opposition to our intellectual property, and, conversely, whether any third-party intellectual property presents unanticipated obstacles for Firdapse ® ; |
• | Whether our lawsuits against Jacobus and the specialty pharmacy distributing its product for patent infringement will be successful; |
• | The effect on our business and future results of operations arising from the approval by the FDA of Ruzurgi ® for the treatment of pediatric LEMS patients (ages 6 to under 17); |
• | Whether our appeal of the District Court’s decision in our suit against the United States FDA seeking to vacate the FDA’s approval of Ruzurgi ® will be successful; |
• | Whether we can continue to compete successfully if the approval of Ruzurgi ® is not overturned and Ruzurgi® continues to be prescribed for off-label use by adult LEMS patients; |
• | Whether, because of the lower price of Ruzurgi ® , payors will require that patients try off-label Ruzurgi® first before they approve Firdapse® as a treatment for adult LEMS patients; |
• | The impact on Firdapse ® of adverse changes in potential reimbursement and coverage policies from government and private payors such as Medicare, Medicaid, insurance companies, health maintenance organizations and other plan administrators, or the impact of pricing pressures enacted by industry organization, the federal government or the government of any state, including as a result of increased scrutiny over pharmaceutical pricing or otherwise; |
• | The impact on our business and results of operations of public statements by politicians and a vocal group of LEMS patients and doctors who object to our pricing of Firdapse ® ; |
• | Changes in the healthcare industry and the effect of political pressure from and actions by President Biden, Congress and/or medical professionals seeking to reduce prescription drug costs; |
• | The state of the economy generally and its impact on our business; |
• | Changes to the healthcare industry occasioned by any changes in laws relating to the pricing of drug products, or changes in the healthcare industry generally; |
• | The scope, rate of progress and expense of our clinical trials and studies, pre-clinical studies, proof-of-concept |
• | Our ability to complete any clinical trials and studies that we may undertake on a timely basis and within the budgets we establish for such trials and studies; |
• | Whether COVID-19 will further affect the timing and costs of our currently ongoing and contemplated clinical trials; |
• | Whether Firdapse ® will ever be approved for the treatment of any neuromuscular disease other than LEMS; |
• | Whether Firdapse ® can be successfully commercialized in Canada on a profitable basis; |
• | Whether our suit to overturn the approval of Ruzurgi ® in Canada will be successful; |
• | The impact on sales of Firdapse ® in the United States if an amifampridine product is purchased in Canada for use in the United States; |
• | Whether we will be able to successfully complete the clinical trial in Japan that will be required to seek approval to commercialize Firdapse ® in Japan; |
• | Whether we will be able to obtain approval to commercialize Firdapse ® in Japan; |
• | Whether we can successfully develop, obtain approval of and successfully market a long-acting version of amifampridine phosphate; |
• | Whether our efforts to grow our business beyond Firdapse ® through acquisitions of companies or in-licensing of product opportunities will be successful; |
• | Whether we will have sufficient capital to finance any such acquisitions; |
• | Whether our version of generic vigabatrin tablets will ever be approved by the FDA; |
• | Even if our version of vigabatrin tablets is approved for commercialization, whether Endo Ventures/Par Pharmaceutical (our collaborator in this venture) will be successful in marketing the product; and |
• | Whether we will earn milestone payments on the first commercial sale of vigabatrin tablets and royalties on sales of generic vigabatrin tablets. |
ITEM 3. |
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK |
ITEM 4. |
CONTROLS AND PROCEDURES |
a. |
We have carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on such evaluation, our principal executive officer and principal financial officer have concluded that as of June 30, 2021, our disclosure controls and procedures were effective to ensure that the information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act, was recorded, processed, summarized or reported within the time periods specified in the rules and regulations of the SEC, and include controls and procedures designed to ensure that information required to be disclosed by us in such reports was accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures. |
b. |
During the three months ended June 30, 2021, there were no changes in our internal controls or in other factors that could have a material effect, or are reasonably likely to have a material effect, on our internal control over financial reporting. |
ITEM 1. |
LEGAL PROCEEDINGS |
ITEM 1A. |
RISK FACTORS |
ITEM 2. |
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Period |
Total Number of Shares Purchased |
Average Price Paid Per Share |
Total Number of Shares Purchased as Part of Publicly Announced Program |
Dollar Value of Shares that May Yet Be Purchased (in thousands) |
||||||||||||
April 1, 2021 – April 30, 2021 |
432,951 | $ | 4.53 | 432,951 | $ | 37,748 | ||||||||||
May 1, 2021 – May 31, 2021 |
9,260 | $ | 4.62 | 9,260 | $ | 37,705 | ||||||||||
June 1, 2021 – June 30, 2021 |
290,740 | $ | 5.73 | 290,740 | $ | 36,040 |
ITEM 3. |
DEFAULTS UPON SENIOR SECURITIES |
ITEM 4. |
MINE SAFETY DISCLOSURE |
ITEM 5. |
OTHER INFORMATION |
ITEM 6. |
EXHIBITS |
31.1 | Certification of Principal Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 | Certification of Principal Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1 | Certification of Principal Executive Officer under Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2 | Certification of Principal Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002 | |
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase | |
101.LAB | XBRL Taxonomy Extension Label Linkbase | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
Catalyst Pharmaceuticals, Inc. | ||
By: | /s/ Alicia Grande | |
Alicia Grande | ||
Vice President, Treasurer and Chief Financial Officer |
Exhibit 31.1
Certification of Principal Executive Officer
I, Patrick J. McEnany, certify that:
1. | I have reviewed this quarterly report on Form 10-Q of Catalyst Pharmaceuticals, Inc.; |
2. | Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiary, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of registrants board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: August 9, 2021
/s/ Patrick J. McEnany |
Patrick J. McEnany |
Chief Executive Officer |
(Principal Executive Officer) |
Exhibit 31.2
Certification of Principal Financial Officer
I, Alicia Grande, certify that:
1. | I have reviewed this quarterly report on Form 10-Q of Catalyst Pharmaceuticals, Inc.; |
2. | Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiary, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of registrants board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: August 9, 2021
/s/ Alicia Grande |
Alicia Grande |
Chief Financial Officer |
(Principal Financial Officer) |
Exhibit 32.1
Certification Required by 18 U.S.C. Section 1350
(as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)
I, Patrick J. McEnany as Principal Executive Officer of Catalyst Pharmaceuticals, Inc. (the Company), certify, pursuant to 18 U.S.C. Section 1350 (as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002), that to my knowledge:
1. | the accompanying Quarterly Report on Form 10-Q of the Company for the quarterly period ended June 30, 2021 (the Report), filed with the U.S. Securities and Exchange Commission, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
2. | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: August 9, 2021 | /s/ Patrick J. McEnany | |||
Patrick J. McEnany | ||||
Chief Executive Officer | ||||
(Principal Executive Officer) |
Exhibit 32.2
Certification Required by 18 U.S.C. Section 1350
(as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)
I, Alicia Grande as Principal Financial Officer of Catalyst Pharmaceuticals, Inc. (the Company), certify, pursuant to 18 U.S.C. Section 1350 (as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002), that to my knowledge:
1. | the accompanying Quarterly Report on Form 10-Q of the Company for the quarterly period ended June 30, 2021 (the Report), filed with the U.S. Securities and Exchange Commission, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
2. | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: August 9, 2021 | /s/ Alicia Grande | |||
Alicia Grande | ||||
Chief Financial Officer | ||||
(Principal Financial Officer) |