Form 6-K MediWound Ltd. For: Jul 28
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
For the month of July 2016
Commission File Number: 001-36349
MediWound Ltd.
(Translation of registrant’s name into English)
42 Hayarkon Street
Yavne, 8122745 Israel
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F x Form 40-F o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): __
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): __
CONTENT AND EXPLANATORY NOTE
On July 24, 2016, Ms. Nirit Freikorn resigned from her position as Chief Marketing Officer of MediWound
On July 28, 2016, MediWound Ltd. (the “Company”) issued a press release entitled “MediWound Reports Second Quarter 2016 Financial Results”. A copy of this press release is attached to this Form 6-K as Exhibit 99.1.
In addition, pursuant to the Information Rights Agreement between the Company and Clal Biotechnology Industries Ltd. ("CBI"), dated March 3, 2014 (which was attached to the Company's registration statement as exhibit 4.3), the Company is required to provide CBI with certain information necessary for CBI to meet its obligations under Israeli Securities Law. This Form 6-K includes an Un-Audited Interim Financial Statements as of June 30, 2016, attached as Exhibit 99.2, which was provided by the Company to CBI on July 28, 2016 pursuant to such contractual obligation.
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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MEDIWOUND LTD.
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Date: July 28, 2016
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By:
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/s/ Sharon Malka | |
| Name: Sharon Malka | |||
| Title: Chief Financial Officer | |||
3
EXHIBIT INDEX
The following exhibit is filed as part of this Form 6-K:
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Exhibit
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Description
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99.1
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Press release dated July 28, 2016 titled “MediWound Reports Second Quarter 2016 Financial Results”.
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99.2
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Un-Audited Interim Financial Statements as of June 30, 2016.
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4
Exhibit 99.1
News Release
MediWound Reports Second Quarter 2016 Financial Results
Conference call begins today at 8:30 a.m. Eastern time
YAVNE, Israel (July 28, 2016) – MediWound Ltd. (Nasdaq: MDWD), a fully-integrated biopharmaceutical company bringing innovative therapies to address unmet needs in severe burn and wound management, reports financial results for the three and six months ended June 30, 2016.
Highlights of the second quarter of 2016 include:
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·
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Received positive reimbursement for NexoBrid® from the Board of the Italian Drug Agency (AIFA);
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·
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Eleven presentations highlighting the positive results achieved by clinicians using NexoBrid as an effective enzymatic debridement for severe burns were presented during the American Burn Association (ABA) 48th Annual Meeting;
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·
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An abstract highlighting the merits of NexoBrid in the direct assessment of burn severity was selected as "Best Oral Presentation" at the British Burn Association's (BBA) 49th Annual Conference and Scientific Meeting;
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·
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Launched NexoBrid in Argentina through the Company’s local distributer partner;
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·
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Expanded global distribution of NexoBrid through a distribution agreement with Kaken Pharmaceuticals Co., Ltd. for the distribution of NexoBrid in Japan for the treatment of severe burns;
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·
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The positive EscharEx® Phase 2 data was presented at the "Late Breaker" session at the Symposium on Advanced Wound Care (SAWC) Spring 2016; and
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·
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A comprehensive review of injectable bromelain solution (IBS, or MWPC003) for the treatment of Dupuytren's contracture was published in the May 2016 edition of the peer-reviewed journal, Bone & Joint Research.
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Management Commentary
“The second quarter featured excellent progress across a number of important areas that positions us for continued commercial and clinical success,” stated Gal Cohen, President and Chief Executive Officer of MediWound. “The second quarter was highlighted by a number of milestones for NexoBrid including receipt of favorable reimbursement in Italy, the presentation of a large number of scientific presentations at the ABA highlighting the product’s ability to debride severe burns, the award of ‘Best Oral Presentation’ at the BBA, the launch of NexoBrid in Argentina and the expansion of NexoBrid into Japan through an exclusive distribution agreement with Kaken.
“We were particularly pleased to have positive Phase 2 data with EscharEx for the debridement of chronic and hard-to-heal wounds presented as a ‘Late Breaker’ at the SAWC Spring conference before an audience of leading wound care specialists. Based on the compelling clinical activity and safety data demonstrated to date, particularly in diabetic foot ulcers and venous leg ulcers, we are moving our clinical plan forward with the goal of making EscharEx available for the treatment of these indications. We plan to hold discussions with the U.S. Food and Drug Administration (FDA) by the end of 2016 regarding plans for a pivotal program for EscharEx in the U.S.
“Data published on MWPC003 in Bone & Joint Research demonstrated statistically significant efficacy in a validated model for connective tissue disorder and supports potential new uses of our enzymatic technology. We are encouraged to generate the remaining data needed to support an Investigational New Drug application for MWPC003 in connective tissue disorders and, subsequently, to embark on a clinical development program in the U.S.,” concluded Mr. Cohen.
Second Quarter Financial Results
Revenues for the second quarter of 2016 were $356,000 compared with $165,000 for the second quarter of 2015.
Net research and development expenses for the second quarter of 2016 were $2.9 million, compared with $1.5 million for the second quarter of 2015. The increase in net research and development expenses was primarily due to an increase of $1.4 million of expenses related to NexoBrid clinical trials and $0.6 million related to EscharEx development, which was offset by an increase of $0.8 million participation by the U.S. Biomedical Advanced Research and Development Authority (BARDA) and Israeli Office of Chief Scientists.
Sales, marketing and G&A expenses increased to $3.7 million for the second quarter of 2016 from $3.4 million for the second quarter of 2016.
For the second quarter of 2016, the Company posted a net loss of $7.5 million, or $0.34 per share, compared with a net loss of $4.1 million, or $0.19 per share, for the second quarter of 2015. The increase was primarily due to an increase in net research and development expenses of $1.4 million and net financial income of $1.4 million, which was recorded in 2015, and was largely comprised of non-cash revaluation of contingent liabilities and changes in foreign currency exchange rates.
Adjusted EBITDA, as defined below, for the second quarter of 2016 was a loss of $5.7 million, compared with a loss of $4.8 million for the second quarter of 2015.
First Half 2016 Financial Results
Revenues for the first half of 2016 were $610,000 compared with $232,000 for the same period of 2015.
Operating expenses for the first half of 2016 were $10.5 million, in line with the Company's budget, and compared with $9.3 million for the same period of 2015. The increase was primarily due to an increase in net research and development expenses of $0.9 million and $0.4 million increase in non-cash share-based compensation expense. The increase in net research and development expenses was primarily due to $2.8 million of expenses related to NexoBrid clinical trials, as well as $1.2 million related to EscharEx development, which was offset by $3.1 million participation by BARDA.
For the six months ended June 30, 2016, the Company posted a net loss of $11.3 million, or $0.52 per share, compared with a net loss of $10.5 million, or $0.49 per share, for the same period in 2015.
Adjusted EBITDA, as defined below, for the first half of 2016 was a loss of $8.7 million, compared with a loss of $8.5 million for the first half of 2015.
Balance Sheet Highlights
As of June 30, 2016 the Company had cash and short-term deposits of $37.8 million and working capital of $36.7 million. The Company remained on budget and utilized $8.2 million in cash to fund operating activities during the first half of 2016.
During 2016 the Company will continue to invest primarily in its sales and marketing activities in Europe to advance the adoption of NexoBrid and in research and development efforts for NexoBrid supported by BARDA funding, as well as advance the development of EscharEx for chronic wounds and other pipeline product candidates.
Cash use for the year is expected to be $18 million to $20 million, lower than the Company’s previous forecast which was in the range of $20 million to $22 million.
Conference Call
MediWound management will host a conference call for investors today, July 28, 2016 beginning at 8:30 a.m. Eastern time to discuss these results and answer questions. Shareholders and other interested parties may participate in the call by dialing (877) 602-7189 (domestic) or (678) 894-3057 (international) and entering passcode 45894739. The call also will be broadcast live on the Internet on the Company's website at www.mediwound.com.
A replay of the call will be accessible two hours after its completion through August 4, 2016 by dialing (855) 859-2056 (domestic) or (404) 537-3406 (international) and entering passcode 45894739. The call will also be archived on the Company website for 90 days at www.mediwound.com.
Non-IFRS Financial Measures
To supplement consolidated financial statements prepared and presented in accordance with IFRS, the Company has provided a supplementary non-IFRS measure to consider in evaluating the Company's performance. Management uses Adjusted EBITDA, which it defines as earnings before interest, taxes, depreciation and amortization, impairment, one-time expenses, restructuring and stock-based compensation expenses.
Although Adjusted EBITDA is not a measure of performance or liquidity calculated in accordance with IFRS, we believe the non-IFRS financial measures we present provide meaningful supplemental information regarding our operating results primarily because they exclude certain non-cash charges or items that we do not believe are reflective of our ongoing operating results when budgeting, planning and forecasting and determining compensation, and when assessing the performance of our business with our senior management.
However, investors should not consider these measures in isolation or as substitutes for operating income, cash flows from operating activities or any other measure for determining the Company's operating performance or liquidity that is calculated in accordance with IFRS. In addition, because Adjusted EBITDA is not calculated in accordance with IFRS, it may not necessarily be comparable to similarly titled measures employed by other companies. The non-IFRS measures included in this press release have been reconciled to the IFRS results in the tables below.
About MediWound Ltd.
MediWound is a fully-integrated biopharmaceutical company focused on developing, manufacturing and commercializing novel therapeutics based on its patented proteolytic enzyme technology to address unmet needs in the fields of severe burns, chronic and other hard-to-heal wounds. MediWound’s first innovative biopharmaceutical product, NexoBrid®, received marketing authorization from the European Medicines Agency as well as the Israeli and Argentinian Ministries of Health, for removal of dead or damaged tissue, known as eschar, in adults with deep partial and full-thickness thermal burns and was launched in Europe Israel and Argentina. NexoBrid represents a new paradigm in burn care management, and clinical trials have demonstrated, with statistical significance, its ability to non-surgically and rapidly remove the eschar earlier and without harming viable tissue.
MediWound's second innovative product, EscharEx®, is a topical biological drug being developed for debridement of chronic and other hard-to-heal wounds and is complementary to the large number of existing wound healing products, which require a clean wound bed in order to heal the wound. EscharEx contains the same proteolytic enzyme technology as NexoBrid, and benefits from the wealth of existing development data on NexoBrid. In two Phase 2 studies, EscharEx demonstrated safety and efficacy in the debridement of chronic and other hard-to-heal wounds, within a few daily applications.
For more information, please visit www.mediwound.com.
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Cautionary Note Regarding Forward-Looking Statements
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This release includes forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, Section 21E of the US Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts, such as statements regarding assumptions and results related to the regulatory authorizations and launch dates. In some cases, you can identify forward-looking statements by terminology such as “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “expect,” “predict,” “potential,” or the negative of these terms or other similar expressions. Forward-looking statements are based on MediWound’s current knowledge and its present beliefs and expectations regarding possible future events and are subject to risks, uncertainties and assumptions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors. In particular, you should consider the risks discussed under the heading “Risk Factors” in our annual report on Form 20-F for the year ended December 31, 2015 and information contained in other documents filed with or furnished to the Securities and Exchange Commission. You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. The forward-looking statements made herein speak only as of the date of this announcement and MediWound undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.
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Contacts:
Sharon Malka
Chief Financial and Operations Officer
MediWound
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Anne Marie Fields
Senior Vice President
LHA
212-838-3777
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-Tables to Follow –
CONDENSED CONSOLIDATED BALANCE SHEETS
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U.S. dollars in thousands
|
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June 30,
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December 31,
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|||||||||||
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2016
|
2015
|
2015
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||||||||||
|
Unaudited
|
Audited
|
|||||||||||
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CURRENT ASSETS:
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||||||||||||
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Cash, cash equivalents and short term deposits
|
37,760 | 55,234 | 45,768 | |||||||||
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Accounts and other receivable
|
3,173 | 2,084 | 2,912 | |||||||||
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Inventories
|
1,160 | 1,773 | 1,715 | |||||||||
| 42,093 | 59,091 | 50,395 | ||||||||||
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LONG-TERM ASSETS:
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||||||||||||
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Long term deposits and deferred costs
|
129 | 249 | 192 | |||||||||
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Property, plant and equipment, net
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1,270 | 1,066 | 1,040 | |||||||||
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Intangible assets, net
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853 | 908 | 896 | |||||||||
| 44,345 | 61,314 | 52,523 | ||||||||||
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CURRENT LIABILITIES:
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Trade payables
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1,571 | 997 | 1,123 | |||||||||
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Accrued expenses and other payables
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3,824 | 2,891 | 4,083 | |||||||||
| 5,395 | 3,888 | 5,206 | ||||||||||
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LONG-TERM LIABILITIES:
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Deferred revenues
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1,021 | - | - | |||||||||
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Liabilities in respect of Chief Scientist government grants net of current maturities
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7,222 | 7,037 | 7,275 | |||||||||
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Contingent consideration for the purchase of treasury shares net of current maturities
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16,639 | 16,729 | 16,475 | |||||||||
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Severance pay liability, net
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99 | 7 | 97 | |||||||||
| 24,981 | 23,773 | 23,847 | ||||||||||
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SHAREHOLDERS' EQUITY
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13,969 | 33,653 | 23,470 | |||||||||
| 44,345 | 61,314 | 52,523 | ||||||||||
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF COMPREHENSIVE LOSS
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U.S. dollars in thousands (except share and per share data)
|
|
Six months ended
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Three months ended
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|||||||||||||||
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June 30,
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June 30,
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|||||||||||||||
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2016
|
2015
|
2016
|
2015
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|||||||||||||
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Revenues
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610 | 232 | 356 | 165 | ||||||||||||
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Cost of revenues
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829 | 1,006 | 425 | 831 | ||||||||||||
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Gross loss
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(219 | ) | (774 | ) | (69 | ) | (666 | ) | ||||||||
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Operating expenses:
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Research and development, gross
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7,473 | 3,351 | 4,243 | 1,954 | ||||||||||||
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Participation by OCS & others
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(3,543 | ) | (460 | ) | (1,306 | ) | (460 | ) | ||||||||
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Research and development, net
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3,930 | 2,891 | 2,937 | 1,494 | ||||||||||||
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Selling, general & administrative
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6,555 | 6,369 | 3,694 | 3,406 | ||||||||||||
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Total operating expenses
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10,485 | 9,260 | 6,631 | 4,900 | ||||||||||||
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Operating loss
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(10,704 | ) | (10,034 | ) | (6,700 | ) | (5,566 | ) | ||||||||
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Financial income (expenses), net
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(581 | ) | (91 | ) | (811 | ) | 1,434 | |||||||||
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Loss from continuing operations
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(11,285 | ) | (10,125 | ) | (7,511 | ) | (4,132 | ) | ||||||||
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Loss from discontinued operation
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- | (417 | ) | - | - | |||||||||||
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Loss for the period
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(11,285 | ) | (10,542 | ) | (7,511 | ) | (4,132 | ) | ||||||||
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Foreign currency translation adjustments
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(3 | ) | 1 | 3 | 0 | |||||||||||
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Total comprehensive loss
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(11,288 | ) | (10,541 | ) | (7,508 | ) | (4,132 | ) | ||||||||
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Basic and diluted loss per share:
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Loss from continuing operations
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(0.52 | ) | (0.47 | ) | (0.34 | ) | (0.19 | ) | ||||||||
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Loss from discontinued operation
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0.00 | (0.02 | ) | 0.00 | 0.00 | |||||||||||
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Net loss per share
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(0.52 | ) | (0.49 | ) | (0.34 | ) | (0.19 | ) | ||||||||
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Weighted average number of ordinary shares used in the computation of basic and diluted loss per share:
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21,850 | 21,611 | 21,850 | 21,672 | ||||||||||||
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS
|
U.S. dollars in thousands
|
|
Six months ended
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Three months ended
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|||||||||||||||
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June 30,
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June 30,
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|||||||||||||||
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2016
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2015
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2016
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2015
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|||||||||||||
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Unaudited
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Unaudited
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|||||||||||||||
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Cash Flows from Operating Activities:
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Net loss
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(11,285 | ) | (10,542 | ) | (7,511 | ) | (4,132 | ) | ||||||||
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Adjustments to reconcile net loss to net cash used in continuing operating activities:
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Adjustments to profit and loss items:
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Loss from discontinued operation
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- | 417 | - | - | ||||||||||||
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Depreciation and amortization
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253 | 230 | 130 | 115 | ||||||||||||
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Share-based compensation
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1,787 | 1,303 | 913 | 616 | ||||||||||||
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Revaluation of liabilities in respect of Chief Scientist government grants
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(23 | ) | (50 | ) | 205 | (252 | ) | |||||||||
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Revaluation of contingent consideration for the purchase of treasury shares
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539 | (491 | ) | 615 | (1,132 | ) | ||||||||||
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Net financing (income) expenses
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(260 | ) | 53 | (31 | ) | (451 | ) | |||||||||
| 2,296 | 1,462 | 1,832 | (1,104 | ) | ||||||||||||
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Changes in asset and liability items:
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Increase in trade receivables
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(155 | ) | (63 | ) | (12 | ) | (93 | ) | ||||||||
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Increase in other receivables
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(329 | ) | (11 | ) | (180 | ) | (101 | ) | ||||||||
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Decrease (increase) in inventories
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546 | (496 | ) | 377 | 287 | |||||||||||
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Increase (decrease) in trade payables
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442 | (208 | ) | (243 | ) | (103 | ) | |||||||||
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Increase in other payables
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640 | 408 | 1,993 | 565 | ||||||||||||
| 1,144 | (370 | ) | 1,935 | 555 | ||||||||||||
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Net cash flows used in operating activities
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(7,845 | ) | (9,450 | ) | (3,744 | ) | (4,681 | ) | ||||||||
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Cash Flows from Investment Activities:
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|
Purchase of property and equipment
|
(440 | ) | (169 | ) | (113 | ) | (108 | ) | ||||||||
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Interest received
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41 | 26 | 32 | 19 | ||||||||||||
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Proceeds from (investment in) short term bank deposits, net of investments
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(23,734 | ) | (1,896 | ) | 5,477 | 1,001 | ||||||||||
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Net cash (used in) provided by investing activities
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(24,133 | ) | (2,039 | ) | 5,396 | 912 | ||||||||||
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Cash Flows from Financing Activities:
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Proceeds from exercise of options
|
- | 20 | - | 20 | ||||||||||||
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Proceeds from the Chief Scientist government grants, net of repayments
|
- | 75 | - | 75 | ||||||||||||
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Net cash provided by financing activities
|
- | 95 | - | 95 | ||||||||||||
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Increase in cash and cash equivalents
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(31,978 | ) | (11,394 | ) | 1,652 | (3,674 | ) | |||||||||
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Exchange rate differences on cash and cash equivalent balances
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70 | (251 | ) | (84 | ) | 352 | ||||||||||
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Balance of cash and cash equivalents at the beginning of the period
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42,502 | 25,422 | 9,026 | 17,099 | ||||||||||||
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Balance of cash and cash equivalents at the end of the period
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10,594 | 13,777 | 10,594 | 13,777 | ||||||||||||
ADJUSTED EBITDA
|
U.S. dollars in thousands
|
|
Six months ended
|
Three months ended
|
|||||||||||||||
|
June 30,
|
June 30,
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|||||||||||||||
|
2016
|
2015
|
2016
|
2015
|
|||||||||||||
|
Loss for the period
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(11,285 | ) | (10,542 | ) | (7,511 | ) | (4,132 | ) | ||||||||
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Adjustments:
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Financial (expenses) income, net
|
(581 | ) | (91 | ) | (811 | ) | 1,434 | |||||||||
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Loss from discontinued operation
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- | (417 | ) | - | - | |||||||||||
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Depreciation and amortization
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(253 | ) | (230 | ) | (130 | ) | (115 | ) | ||||||||
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Share-based compensation expenses
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(1,787 | ) | (1,303 | ) | (913 | ) | (616 | ) | ||||||||
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Total adjustments
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(2,621 | ) | (2,041 | ) | (1,854 | ) | 703 | |||||||||
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Adjusted EBITDA
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(8,664 | ) | (8,501 | ) | (5,657 | ) | (4,835 | ) | ||||||||
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|
|
Share-based compensation expenses:
|
||||||||||||||||
|
Cost of revenues
|
260 | 203 | 130 | 102 | ||||||||||||
|
Research and development
|
385 | 247 | 192 | 125 | ||||||||||||
|
Selling, general and administrative
|
1,142 | 853 | 591 | 389 | ||||||||||||
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Total share-based compensation expenses
|
1,787 | 1,303 | 913 | 616 | ||||||||||||
Exhibit 99.2
MEDIWOUND LTD. AND ITS SUBSIDIARIES
INTERIM CONDENSED FINANCIAL STATEMENTS
AS OF JUNE 30, 2016
IN U.S. DOLLARS IN THOUSANDS
UNAUDITED
INDEX
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Page
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F-2
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F-3
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F-4 – F-6
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F-7 - F-8
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F-9 - F-11
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MEDIWOUND LTD. AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
|
June 30,
|
December 31,
|
|||||||||||
|
2016
|
2015
|
2015
|
||||||||||
|
Unaudited
|
Audited
|
|||||||||||
|
CURRENT ASSETS:
|
||||||||||||
|
Cash and cash equivalents
|
10,594 | 13,777 | 42,502 | |||||||||
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Short-term bank deposits
|
27,166 | 41,457 | 3,266 | |||||||||
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Trade receivables
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401 | 123 | 238 | |||||||||
|
Inventories
|
1,160 | 1,773 | 1,715 | |||||||||
|
Other receivables
|
2,772 | 1,961 | 2,674 | |||||||||
| 42,093 | 59,091 | 50,395 | ||||||||||
|
LONG-TERM ASSETS:
|
||||||||||||
|
Long term deposits and deferred costs
|
129 | 249 | 192 | |||||||||
|
Property, plant and equipment, net
|
1,270 | 1,066 | 1,040 | |||||||||
|
Intangible assets, net
|
853 | 908 | 896 | |||||||||
| 2,252 | 2,223 | 2,128 | ||||||||||
| 44,345 | 61,314 | 52,523 | ||||||||||
|
CURRENT LIABILITIES:
|
||||||||||||
|
Trade payables
|
1,571 | 997 | 1,123 | |||||||||
|
Other payables
|
3,824 | 2,891 | 4,083 | |||||||||
| 5,395 | 3,888 | 5,206 | ||||||||||
|
LONG-TERM LIABILITIES:
|
||||||||||||
|
Deferred revenues
|
1,021 | - | - | |||||||||
|
Liabilities in respect of Chief Scientist government grants net of current maturities
|
7,222 | 7,037 | 7,275 | |||||||||
|
Contingent consideration for the purchase of treasury shares net of current maturities
|
16,639 | 16,729 | 16,475 | |||||||||
|
Severance pay liability, net
|
99 | 7 | 97 | |||||||||
| 24,981 | 23,773 | 23,847 | ||||||||||
|
SHAREHOLDERS' EQUITY:
|
||||||||||||
|
Ordinary shares of NIS 0.01 par value:
|
||||||||||||
|
Authorized: 32,244,508 shares; Issued and Outstanding: 21,850,300 as of June 30, 2016 and December 31, 2015 and 21,765,800 as of June 30, 2015
|
60 | 60 | 60 | |||||||||
|
Share premium
|
113,588 | 110,439 | 111,801 | |||||||||
|
Foreign currency translation adjustments
|
(19 | ) | (17 | ) | (16 | ) | ||||||
|
Accumulated deficit
|
(99,660 | ) | (76,829 | ) | (88,375 | ) | ||||||
| 13,969 | 33,653 | 23,470 | ||||||||||
| 44,345 | 61,314 | 52,523 | ||||||||||
The accompanying notes are an integral part of the interim consolidated financial statements.
F - 2
U.S. dollars in thousands (except share data and per share data)
|
Six months ended
June 30,
|
Three months ended
June 30,
|
Year ended
December 31,
|
||||||||||||||||||
|
2016
|
2015
|
2016
|
2015
|
2015
|
||||||||||||||||
|
Unaudited
|
Audited
|
|||||||||||||||||||
|
Revenues
|
610 | 232 | 356 | 165 | 601 | |||||||||||||||
|
Cost of revenues
|
829 | 1,006 | 425 | 831 | 2,519 | |||||||||||||||
|
Gross loss
|
(219 | ) | (774 | ) | (69 | ) | (666 | ) | (1,918 | ) | ||||||||||
|
Operating expenses:
|
||||||||||||||||||||
|
Research and development, net of participations
|
3,930 | 2,891 | 2,937 | 1,494 | 6,021 | |||||||||||||||
|
Selling and marketing
|
4,528 | 4,631 | 2,586 | 2,547 | 9,284 | |||||||||||||||
|
General and administrative
|
2,027 | 1,738 | 1,108 | 859 | 4,004 | |||||||||||||||
|
Operating loss
|
(10,704 | ) | (10,034 | ) | (6,700 | ) | (5,566 | ) | (21,227 | ) | ||||||||||
|
Financial income
|
397 | 646 | 109 | 1,650 | 1,052 | |||||||||||||||
|
Financial expense
|
(978 | ) | (737 | ) | (920 | ) | (216 | ) | (1,496 | ) | ||||||||||
|
Loss from continuing operations
|
(11,285 | ) | (10,125 | ) | (7,511 | ) | (4,132 | ) | (21,671 | ) | ||||||||||
|
Loss from discontinued operation
|
- | (417 | ) | - | - | (417 | ) | |||||||||||||
|
Loss for the period
|
(11,285 | ) | (10,542 | ) | (7,511 | ) | (4,132 | ) | (22,088 | ) | ||||||||||
|
Other comprehensive loss:
|
||||||||||||||||||||
|
Items to be reclassified to profit or loss in subsequent periods:
|
||||||||||||||||||||
|
Foreign currency translation adjustments
|
(3 | ) | 1 | 3 | (* | ) | 2 | |||||||||||||
|
Total other comprehensive income (loss)
|
(3 | ) | 1 | 3 | (* | ) | 2 | |||||||||||||
|
Total comprehensive loss
|
(11,288 | ) | (10,541 | ) | (7,508 | ) | (4,132 | ) | (22,086 | ) | ||||||||||
|
Basic and diluted loss per share:
|
||||||||||||||||||||
|
Loss from continuing operations
|
(0.52 | ) | (0.47 | ) | (0.34 | ) | (0.19 | ) | (1.00 | ) | ||||||||||
|
Loss from discontinued operation
|
- | (0.02 | ) | - | - | (0.02 | ) | |||||||||||||
|
Net loss per share
|
(0.52 | ) | (0.49 | ) | (0.34 | ) | (0.19 | ) | (1.02 | ) | ||||||||||
|
Weighted average number of ordinary shares used in the computation of basic and diluted loss per share
|
21,850 | 21,611 | 21,850 | 21,672 | 21,718 | |||||||||||||||
(*) Represents less than $ 0.01.
The accompanying notes are an integral part of the interim consolidated financial statements.
F - 3
MEDIWOUND LTD. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands (except share data)
|
Share capital
|
Share premium
|
Foreign currency translation reserve
|
Accumulated
deficit
|
Total
equity
|
||||||||||||||||
|
Balance as of January 1, 2016
|
60 | 111,801 | (16 | ) | (88,375 | ) | 23,470 | |||||||||||||
|
Loss for the period
|
- | - | - | (11,285 | ) | (11,285 | ) | |||||||||||||
|
Other comprehensive loss
|
- | - | (3 | ) | - | (3 | ) | |||||||||||||
|
Total comprehensive loss
|
- | - | (3 | ) | (11,285 | ) | (11,288 | ) | ||||||||||||
|
Share-based compensation
|
- | 1,787 | - | - | 1,787 | |||||||||||||||
|
Balance as of June 30, 2016 (unaudited)
|
60 | 113,588 | (19 | ) | (99,660 | ) | 13,969 | |||||||||||||
|
Share capital
|
Share premium
|
Foreign currency translation reserve
|
Accumulated
deficit
|
Total
equity
|
||||||||||||||||
|
Balance as of January 1, 2015
|
59 | 109,117 | (18 | ) | (66,287 | ) | 42,871 | |||||||||||||
|
Loss for the period
|
- | - | - | (10,542 | ) | (10,542 | ) | |||||||||||||
|
Other comprehensive income
|
- | - | 1 | - | 1 | |||||||||||||||
|
Total comprehensive income (loss)
|
- | - | 1 | (10,542 | ) | (10,541 | ) | |||||||||||||
|
Exercise of options
|
1 | 19 | - | - | 20 | |||||||||||||||
|
Share-based compensation
|
- | 1,303 | - | - | 1,303 | |||||||||||||||
|
Balance as of June 30, 2015 (unaudited)
|
60 | 110,439 | (17 | ) | (76,829 | ) | 33,653 | |||||||||||||
(*) Represents less than $ 1.
The accompanying notes are an integral part of the interim consolidated financial statements.
F - 4
U.S. dollars in thousands (except share data)
|
Share capital
|
Share premium
|
Foreign currency translation reserve
|
Accumulated
deficit
|
Total
equity
|
||||||||||||||||
|
Balance as of April 1, 2016
|
60 | 112,675 | (22 | ) | (92,149 | ) | 20,564 | |||||||||||||
|
Loss for the period
|
- | - | - | (7,511 | ) | (7,511 | ) | |||||||||||||
|
Other comprehensive profit
|
- | - | 3 | - | 3 | |||||||||||||||
|
Total comprehensive income (loss)
|
- | - | 3 | (7,511 | ) | (7,508 | ) | |||||||||||||
|
Share-based compensation
|
- | 913 | - | - | 913 | |||||||||||||||
|
Balance as of June 30, 2016 (unaudited)
|
60 | 113,588 | (19 | ) | (99,660 | ) | 13,969 | |||||||||||||
|
Share capital
|
Share premium
|
Foreign currency translation reserve
|
Accumulated
deficit
|
Total
equity
|
||||||||||||||||
|
Balance as of April 1, 2015 (unaudited)
|
59 | 109,804 | (17 | ) | (72,697 | ) | 37,149 | |||||||||||||
|
Loss for the period
|
- | - | - | (4,132 | ) | (4,132 | ) | |||||||||||||
|
Other comprehensive loss
|
- | - | (* | ) | - | (* | ) | |||||||||||||
|
Total comprehensive loss
|
- | - | (* | ) | (4,132 | ) | (4,132 | ) | ||||||||||||
|
Exercise of options
|
1 | 19 | - | - | 20 | |||||||||||||||
|
Share-based compensation
|
- | 616 | - | - | 616 | |||||||||||||||
|
Balance as of June 30, 2015 (unaudited)
|
60 | 110,439 | (17 | ) | (76,829 | ) | 33,653 | |||||||||||||
(*) Represents less than $ 1.
The accompanying notes are an integral part of the interim consolidated financial statements.
F - 5
MEDIWOUND LTD. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands (except share data)
|
Share capital
|
Share premium
|
Foreign currency translation reserve
|
Accumulated
deficit
|
Total
equity
|
||||||||||||||||
|
Balance as of January 1, 2015
|
59 | 109,117 | (18 | ) | (66,287 | ) | 42,871 | |||||||||||||
|
Loss for the period
|
- | - | - | (22,088 | ) | (22,088 | ) | |||||||||||||
|
Other comprehensive income
|
- | - | 2 | - | 2 | |||||||||||||||
|
Total comprehensive income (loss)
|
- | - | 2 | (22,088 | ) | (22,086 | ) | |||||||||||||
|
Exercise of options
|
1 | 25 | - | - | 26 | |||||||||||||||
|
Share-based compensation
|
- | 2,659 | - | - | 2,659 | |||||||||||||||
|
Balance as of December 31, 2015
|
60 | 111,801 | (16 | ) | (88,375 | ) | 23,470 | |||||||||||||
(*) Represents less than $ 1.
The accompanying notes are an integral part of the interim consolidated financial statements.
F - 6
U.S. dollars in thousands
|
Six months ended
June 30,
|
Three months ended
June 30,
|
Year ended
December 31,
|
||||||||||||||||||
|
2016
|
2015
|
2016
|
2015
|
2015
|
||||||||||||||||
|
Unaudited
|
Audited
|
|||||||||||||||||||
|
Cash flows from operating activities:
|
||||||||||||||||||||
|
Net loss
|
(11,285 | ) | (10,542 | ) | (7,511 | ) | (4,132 | ) | (22,088 | ) | ||||||||||
|
Adjustments to reconcile net loss to net cash used in continuing operating activities:
|
||||||||||||||||||||
|
Adjustments to profit and loss items:
|
||||||||||||||||||||
|
Loss from discontinued operation
|
- | 417 | - | - | 417 | |||||||||||||||
|
Depreciation and amortization
|
253 | 230 | 130 | 115 | 503 | |||||||||||||||
|
Share-based compensation
|
1,787 | 1,303 | 913 | 616 | 2,659 | |||||||||||||||
|
Revaluation of liabilities in respect of Chief Scientist government grants
|
(23 | ) | (50 | ) | 205 | (252 | ) | (474 | ) | |||||||||||
|
Revaluation of contingent consideration for the purchase of treasury shares
|
539 | (491 | ) | 615 | (1,132 | ) | (764 | ) | ||||||||||||
|
Increase in severance liability
|
- | - | - | - | 90 | |||||||||||||||
|
Other financing (income) expenses
|
(260 | ) | 53 | (31 | ) | (451 | ) | (219 | ) | |||||||||||
| 2,296 | 1,462 | 1,832 | (1,104 | ) | 2,212 | |||||||||||||||
|
Changes in asset and liability items:
|
||||||||||||||||||||
|
Increase in trade receivables
|
(155 | ) | (63 | ) | (12 | ) | (93 | ) | (181 | ) | ||||||||||
|
Decrease (increase) in inventories
|
546 | (496 | ) | 377 | 287 | (273 | ) | |||||||||||||
|
Increase in other receivables
|
(329 | ) | (11 | ) | (180 | ) | (101 | ) | (556 | ) | ||||||||||
|
Increase (decrease) in trade payables
|
442 | (208 | ) | (243 | ) | (103 | ) | (76 | ) | |||||||||||
|
Increase in other payables
|
640 | 408 | 1,993 | 565 | 1,361 | |||||||||||||||
| 1,144 | (370 | ) | 1,935 | 555 | 275 | |||||||||||||||
|
Net cash flows used in operating activities
|
(7,845 | ) | (9,450 | ) | (3,744 | ) | (4,681 | ) | (19,601 | ) | ||||||||||
The accompanying notes are an integral part of the interim consolidated financial statements.
F - 7
MEDIWOUND LTD. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
|
Six months ended
June 30,
|
Three months ended
June 30,
|
Year ended
December 31,
|
||||||||||||||||||
|
2016
|
2015
|
2016
|
2015
|
2015
|
||||||||||||||||
|
Unaudited
|
Audited
|
|||||||||||||||||||
|
Cash Flows from Investing Activities:
|
||||||||||||||||||||
|
Purchase of property and equipment
|
(440 | ) | (169 | ) | (113 | ) | (108 | ) | (376 | ) | ||||||||||
|
Purchase of intangible assets
|
- | - | - | - | (30 | ) | ||||||||||||||
|
Interest received
|
41 | 26 | 32 | 19 | 287 | |||||||||||||||
|
Net proceeds from (investments in) short term bank deposits
|
(23,734 | ) | (1,896 | ) | 5,477 | 1,001 | 36,165 | |||||||||||||
|
Net cash (used in) provided by investing activities
|
(24,133 | ) | (2,039 | ) | 5,396 | 912 | 36,046 | |||||||||||||
|
Cash Flows from Financing Activities:
|
||||||||||||||||||||
|
Proceeds from exercise of options
|
- | 20 | - | 20 | 26 | |||||||||||||||
|
Proceeds from the Chief Scientist government grants, net of re-payment
|
- | 75 | - | 75 | 752 | |||||||||||||||
|
Net cash provided by financing activities
|
- | 95 | - | 95 | 778 | |||||||||||||||
|
Exchange rate differences on cash and cash equivalent balances
|
70 | (251 | ) | (84 | ) | 352 | (143 | ) | ||||||||||||
|
Increase (decrease) in cash and cash equivalents from continuing activities
|
(31,908 | ) | (11,645 | ) | 1,568 | (3,322 | ) | 17,080 | ||||||||||||
|
Balance of cash and cash equivalents at the beginning of the period
|
42,502 | 25,422 | 9,026 | 17,099 | 25,422 | |||||||||||||||
|
Balance of cash and cash equivalents at the end of the period
|
10,594 | 13,777 | 10,594 | 13,777 | 42,502 | |||||||||||||||
The accompanying notes are an integral part of the interim consolidated financial statements.
F - 8
MEDIWOUND LTD. AND ITS SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
U.S. dollars in thousands (except share and per share data)
|
NOTE 1:
|
GENERAL
|
|
a.
|
General description of the Company and its operations:
|
MediWound Ltd. (the "Company" or "MediWound"), is a fully integrated biopharmaceutical company focused on developing, manufacturing and commercializing novel products to address unmet needs in the fields of severe burns, as well as chronic and other hard to heal wounds, connective tissue disorders and other indications.
The Company's innovative biopharmaceutical product, NexoBrid, received marketing authorization from the European Medicines Agency, ("EMA") and the Israeli and Argentinean ministries of health for removal of dead or damaged tissue, known as eschar, in adults with deep partial and full thickness thermal burns. The Company launched NexoBrid in the European Union and in Israel through its own commercial organization and first generated initial sales in 2014.
The Company's securities are listed for trading on NASDAQ since March 25, 2014.
|
b.
|
The Company has two wholly-owned subsidiaries: MediWound Germany GmbH, acting as Europe ("EU") marketing authorization holder and EU sales and marketing arm and MediWound UK Limited, an inactive company. In addition, the Company owns approximately 7% of PolyHeal Ltd., a private life sciences company ("PolyHeal").
|
|
c.
|
On September 29, 2015, the Company was awarded a U.S. Biomedical Advanced Research and Development Authority ("BARDA") contract valued up to $112,000 for development and procurement of NexoBrid for the U.S. The contract is for the advancement of the development and manufacturing, as well as the procurement of NexoBrid, as a medical countermeasure as part of BARDA preparedness for mass casualty events.
|
The five-year base contract includes $24,000 of funding to support development activities to complete the U.S. Food and Drug Administration (FDA) approval process for NexoBrid for use in thermal burn injuries, as well as $16,000 for procurement of NexoBrid, which is contingent upon FDA Emergency Use Authorization (EUA) and/or FDA marketing authorization for NexoBrid. In addition, the contract includes options for further funding of up to $22,000 for expanding NexoBrid’s indications and of up to $50,000 for additional procurement of NexoBrid. As of June 30, 2016 the Company recorded approximately $3,900 in funding from BARDA under the contract.
F - 9
MEDIWOUND LTD. AND ITS SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
U.S. dollars in thousands (except share and per share data)
|
NOTE 2:
|
SIGNIFICANT ACCOUNTING POLICIES
|
The following accounting policies have been applied consistently in the financial statements for all periods presented unless otherwise stated.
|
a.
|
Basis of presentation of financial statements:
|
These financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").
|
b.
|
Basis of preparation of the interim consolidated financial statements:
|
The interim condensed consolidated financial statements for the six months and three months ended June 30, 2016 have been prepared in accordance with IAS 34 "Interim Financial Reporting".
The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Company's annual financial statements as of December 31, 2015 that were included in the Annual Report on Form 20-F filed on January 25, 2016.
The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Company’s annual consolidated financial statements for the year ended December 31, 2015 that were included in the Annual Report on Form 20-F filed on January 25, 2016.
|
NOTE 3:
|
CONTINGENT LIABILITIES
|
On September 15, 2014, a Statement of Claim was filed against the Company by some shareholders of Polyheal. The plaintiffs allege that the Company is obligated to pay them a total amount of $1,475 in exchange for their respective portion of PolyHeal's shares, following the commencement of a feasibility study for the next generation of the PolyHeal Product in November 15, 2012, which constituted a milestone under a buyout option agreement between the Company, PolyHeal and its shareholders.
On December 14, 2014, the Company filed its Petition for a Right to Defend, or the Petition, in which it: (i) rejected the arguments raised against it in the Statement of Claim; (ii) emphasized that its obligation under the 2010 Polyheal Agreement to purchase the 7.5% of Polyheal’s ordinary shares is subject to the consumption of the deferred closing, as defined in the buyout agreement, including the receipt of the funds from Teva on a “back to back” basis; and (iii) stated that since no such payment has been made by Teva, the Company is not subject to any obligation to purchase Polyheal shares and/or make any payments to Polyheal’s shareholders.
A hearing in the Company's Petition was held on February 16, 2015, in which the Court accepted the Company's Petition and allowed it to file a statement of defense. The Company filed the statement of defense on July 6, 2015. A preliminary hearing took place on February 10, 2016. On June 21, 2016, both parties presented their oral summaries before the Court. No ruling has yet been given.
F - 10
MEDIWOUND LTD. AND ITS SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
U.S. dollars in thousands (except share and per share data)
|
NOTE 3:
|
CONTINGENT LIABILITIES (Cont.)
|
Based on advice from its external legal counsels, the Company believes that it has substansive defenses against the claim. Accordingly, no provision was recorded in respect of this claim.
|
NOTE 4:
|
EQUITY
|
On January 1, 2016, the Company granted to the chairman of the board of directors options to purchase 20,000 ordinary shares under the "2014 Share Incentive Plan" (the "Plan") for an exercise price of $9.47 per share. The options are exercisable in accordance with the terms of the Plan, within 5 years from the date of grant and will vest over three years. The fair value of the options at the date of grant was estimated at $62.
On January 28, 2016, the general meeting of the Company's shareholders approved the grant to CEO dated December 23, 2015 and the above mention grant.
On June 9, 2016, the general meeting of the Company approved to extend the exercise period of certain options previously granted to CEO. The Fair Value of the extension of the Options, as of the modification date, was estimated at approximately $39.
|
NOTE 5:
|
OTHER ASSETS
|
The Company has been acknowledged during the first quarter of 2015 about certain changes in circumstances indicating that the carrying amount of its royalty rights arising from the Company's ownership of shares of Polyheal would not be recoverable. Accordingly, a full impairment of these royalty rights amounting to $417 was recorded within the loss from discontinued operation for the six months period ended June 30, 2015.
F-11