GW Pharmaceuticals plc Reports Fourth Quarter and Year-End 2016 Financial Results and Operational Progress

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Dec 05, 2016

- Three Positive Phase 3 Epidiolex clinical trials reported in 2016 –

- NDA submission and launch preparation on track –

-Conference call today at 8:00 a.m. EST-

London, UK, 5 December 2016: GW Pharmaceuticals plc (NASDAQ: GWPH, GW, the Company or the Group), a biopharmaceutical company focused on discovering, developing and commercializing novel therapeutics from its proprietary cannabinoid product platform, announced financial results for the fourth quarter and year-ended 30 September 2016.                            

“In 2016 GW has completed three positive Phase 3 trials for Epidiolex in patients with two different rare treatment resistant forms of childhood-onset epilepsy and we are making good progress towards an NDA submission. Our sights are now focused on Epidiolex approval and accelerating our preparations for a highly successful launch,” stated Justin Gover, GW’s Chief Executive Officer. “Our goal is to provide the children and their families suffering from these highly treatment-resistant forms of childhood-onset epilepsy with a much needed new prescription option as quickly as possible.”

2016 OPERATIONAL HIGHLIGHTS

  • Epidiolex® (CBD) orphan epilepsy program in Dravet syndrome, Lennox-Gastaut Syndrome (LGS), Tuberous Sclerosis Complex (TSC) and infantile spasms (IS)

    • Phase 3 trials:

      • Positive results in a pivotal Phase 3 Dravet syndrome trial
      • Positive results in two pivotal Phase 3 LGS trials
      • Positive data presented at the American Epilepsy Society Annual Meeting
    • Regulatory:
      • Positive Dravet syndrome pre-NDA meeting held with FDA in July 2016
      • Positive CMC pre-NDA meeting held with FDA in November 2016
      • NDA submission for both Dravet and LGS indications expected at end of H1 2017, just 3 years since opening of IND
      • Preparations advancing for EU regulatory submission in H2 2017
    • Manufacturing scale-up:
      • Manufacturing scale-up on track to deliver significant commercial launch inventory
    • Expanded access program and open label extension:
      • 98% of patients who complete Phase 3 trials have entered long term extension
      • Over 1,000 patients now on Epidiolex treatment
      • NDA submission to include safey data from over 1,500 patients and over 400 patients with 1 year or more continuous exposure
      • Withdrawal rate in long term studies approx 20%
    • Commercial:
      • US commercial team build underway and pre-launch preparations advancing well
      • EU commercial team now being established
    • Additional indications:
      • Phase 3 trial in TSC ongoing
      • Two part Phase 3 trial in IS commenced in December 2016
    • Intellectual Property:
      • Patent portfolio being prosecuted with claims directed to the use of CBD in the treatment of epilepsy seizure subtypes and epilepsy syndromes
  • Advanced clinical programs in multiple cannabinoid pipeline product candidates:
    • CBDV Phase 2 partial-onset epilepsy study in adults ongoing. Part A complete and Part B underway with data expected mid-2017
    • CBDV pre-clinical research ongoing within field of autism spectrum disorders. Phase 2 trials expected to commence in Q3 2017
      • Orphan Drug Designation from FDA for CBDV for the treatment of Rett syndrome
    • Neonatal Hypoxic-Ischemic Encephalopathy (NHIE) intravenous CBD program
      • Phase 1 trial commenced in December 2016
      • Orphan Drug and Fast Track Designations granted from FDA and EMA
    • THC:CBD for the treatment of Recurrent Glioblastoma Multiforme (GBM)
      • Phase 1b/2a study completed – data expected Q1 2017
      • Orphan Drug Designation from FDA
    • Sativex® Phase 2 study in children with spasticity due to cerebral palsy completed – data expected Q1 2017

FINANCIAL HIGHLIGHTS

  • Revenue for the twelve months ended 30 September 2016 of £10.3 million ($13.3 million) compared to £28.5 million for the twelve months ended 30 September 2015.
  • Loss for the twelve months ended 30 September 2016 of £63.7 million ($82.2 million) compared to £44.6 million for the twelve months ended 30 September 2015.
  • Cash and cash equivalents at 30 September 2016 of £374.4 million ($483.4 million) compared to £234.9 million as at 30 September 2015.

Conference Call and Webcast Information

GW Pharmaceuticals will host a conference call and webcast to discuss the fourth quarter and year-end 2016 financial results today at 8:00 a.m.. To participate in the conference call, please dial 877-407-8133 (toll free from the U.S. and Canada) or 201-689-8040 (international). Investors may also access a live audio webcast of the call via the investor relations section of the Company’s website at http://www.gwpharm.com. A replay of the call will also be available through the GW website shortly after the call and will remain available for 90 days. Replay Numbers: (toll free):1-877-481-4010, (international):1-919-882-2331. For both dial-in numbers please use conference ID # 13650870.

About GW Pharmaceuticals plc

Founded in 1998, GW is a biopharmaceutical company focused on discovering, developing and commercializing novel therapeutics from its proprietary cannabinoid product platform in a broad range of disease areas. GW is advancing an orphan drug program in the field of childhood epilepsy with a focus on Epidiolex® (cannabidiol), which is in Phase 3 clinical development for the treatment of Dravet syndrome, Lennox-Gastaut syndrome, Tuberous Sclerosis Complex and Infantile Spasms. GW commercialized the world’s first plant-derived cannabinoid prescription drug, Sativex®, which is approved for the treatment of spasticity due to multiple sclerosis in 30 countries outside the United States. The Company has a deep pipeline of additional cannabinoid product candidates which includes compounds in Phase 1 and 2 trials for glioma, schizophrenia and epilepsy. For further information, please visit www.gwpharm.com.

Forward-looking statements

This news release contains forward-looking statements that reflect GW's current expectations regarding future events, including statements regarding financial performance, the timing of clinical trials, the relevance of GW products commercially available and in development, the clinical benefits of Sativex® and Epidiolex® and the safety profile and commercial potential of Sativex and Epidiolex. Forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein and depend on a number of factors, including (inter alia), the success of GW’s research strategies, the applicability of the discoveries made therein, the successful and timely completion of uncertainties related to the regulatory process, and the acceptance of Sativex, Epidiolex and other products by consumer and medical professionals. A further list and description of risks and uncertainties associated with an investment in GW can be found in GW’s filings with the U.S. Securities and Exchange Commission. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. GW undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise.

Enquiries:

GW Pharmaceuticals plc

 

Stephen Schultz, VP Investor Relations

401 500 6570

 

Sam Brown (U.S. Media Enquiries)

 

Amanda Foley

610-725-0725 / 610-585-9400

 

Solely for the convenience of the reader, unless otherwise indicated, all pound sterling amounts stated in the Condensed Consolidated Balance Sheet as at 30 September 2016, the Condensed Consolidated Income Statement, Condensed Consolidated Statement of Comprehensive Income, Condensed Consolidated Statement of Changes in Equity and the Condensed Consolidated Cash Flow Statement for the three months and for the year ended 30 September 2016 have been translated into U.S. dollars at the rate on 30 September 2016 of $1.29128 to £1.00. These translations should not be considered representations that any such amounts have been, could have been or could be converted into U.S. dollars at that or any other exchange rate as at that or any other date.

 

 

Three months

 ended

Three months

 ended

Three months

 ended

 

 

30 September

30 September

30 September

 

 

2016

2016

2015

 

 

$000’s

£000’s

£000’s

Revenue

 

2,156

1,670

5,595

Cost of sales

 

(1,006)

(779)

(683)

Research and development expenditure

 

(31,401)

(24,318)

(25,457)

Sales, general and administrative expenses

 

(9,645)

(7,469)

(4,988)

Net foreign exchange gain

 

8,099

6,272

6,874

 

 

_______

_______

_______

Operating loss

 

(31,797)

(24,624)

(18,659)

Interest and other income

 

408

316

83

Interest expense

 

(155)

(120)

(15)

 

 

_______

_______

_______

Loss before tax

 

(31,544)

(24,428)

(18,591)

Tax benefit

 

9,710

7,520

6,358

 

 

_______

_______

_______

Loss for the period

 

(21,834)

(16,908)

(12,233)

 

 

_______

_______

_______

 

 

 

 

 

Loss per share – basic and diluted

 

(7.4c)

(5.7p)

(4.7p)

 

All activities relate to continuing operations.

 

 

 

Condensed consolidated statement of comprehensive loss                                                                            

For the three months ended 30 September 2016

 

Three months ended 

30 September

2016

£000’s

Three months ended

30 September

2015

£000’s

Loss for the period

(16,908)

(12,233)

Items that may be reclassified subsequently to profit or loss

 

 

Exchange differences on translation of foreign operations

183

(51)

Other comprehensive gain/(loss) for the period

183

(51)

Total comprehensive loss for the period

(16,725)

(12,284)

 

 

 

 

 

 

Year ended

Year ended

Year ended

 

 

30 September

30 September

30 September

 

 

2016

2016

2015

 

 

$000’s

£000’s

£000’s

Revenue

 

13,320

10,315

28,540

Cost of sales

 

(3,511)

(2,719)

(2,618)

Research and development expenditure

 

(128,889)

(99,815)

(76,785)

Sales, general and administrative expenses

 

(25,747)

(19,939)

(12,569)

Net foreign exchange gain

 

32,993

25,551

6,202

 

 

_______

_______

_______

Operating loss

 

(111,834)

(86,607)

(57,230)

Other income

 

785

608

244

Interest expense

 

(223)

(173)

(75)

 

 

_______

_______

_______

Loss before tax

 

(111,272)

(86,172)

(57,061)

Tax benefit

 

29,073

22,515

12,498

 

 

_______

_______

_______

Loss for the year

 

(82,199)

(63,657)

(44,563)

 

 

_______

_______

_______

 

 

 

 

 

Loss per share – basic and diluted

 

(30.4c)

(23.5p)

(18.1p)

 

All activities relate to continuing operations.

 

 

Condensed consolidated statement of comprehensive loss                                                                            

For the year ended 30 September 2016

 

Year ended 

30 September

2016

£000’s

Year ended

30 September

2015

£000’s

Loss for the year

(63,657)

(44,563)

Items that may be reclassified subsequently to profit or loss

 

 

Exchange differences on translation of foreign operations

349

(71)

Other comprehensive gain/(loss) for the year

349

(71)

Total comprehensive loss for the year

(63,308)

(44,634)

 

 

 

 

 

 

 

 

Called-up

           Share

 

 

 

 

share

       premium

          Other

Accumulated

Total

 

capital

         account

     reserves

            deficit

      equity

 

£000’s

£000’s

£000’s

£000’s

£000’s

Balance at 1 October 2014

237

220,551

19,260

(81,464)

158,584

Issue of share capital

22

127,812

127,834

Expense of new equity issue

(271)

(271)

Exercise of share options

2

1,183

1,185

Share-based payment transactions

2,488

2,488

Loss for the year

(44,563)

(44,563)

Deferred tax attributable to unrealized share option gains

84

84

Other comprehensive expense

(71)

(71)

 

_________

_________

________

__________

________

Balance at 30 September 2015

261

349,275

19,189

(123,455)

245,270

 

_________

_________

________

__________

________

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at 1 October 2015

261

349,275

19,189

(123,455)

245,270

Issue of share capital

39

206,512

206,551

Expense of new equity issue

(472)

(472)

Underwriters’ contribution towards expenses of new equity issue

472

472

Exercise of share options

2

690

692

Share-based payment transactions

8,152

8,152

Loss for the year

(63,657)

(63,657)

Deferred tax attributable to unrealized share option gains

1,133

1,133

Other comprehensive expense

349

349

 

_________

_________

________

__________

________

Balance at 30 September 2016

302

556,477

19,538

(177,827)

398,490

 

_________

_________

________

__________

________

 

 

 

 

As at 30 September

As at 30 September

As at 30 September

 

 

2016

2016

2015

 

 

 

 

 

Non-current assets

 

$000’s

£000’s

 £000’s

Intangible assets - goodwill

 

6,728

5,210

5,210

Other intangible assets

 

812

629

245

Property, plant and equipment

 

50,291

38,947

28,733

Deferred tax asset

 

5,001

3,873

418

 

 

_________

__________

__________

 

 

62,832

48,659

34,606

 

 

_________

__________

__________

Current assets

 

 

 

 

Inventories

 

5,485

4,248

4,756

Taxation recoverable

 

27,533

21,322

12,641

Trade receivables and other assets

 

5,883

4,556

2,873

Cash and cash equivalents

 

483,445

374,392

234,872

 

 

_________

__________

__________

 

 

522,346

404,518

255,142

 

 

_________

__________

__________

Total assets

 

585,178

453,177

289,748

 

 

_________

__________

__________

Current liabilities

 

 

 

 

Trade and other payables

 

(40,249)

(31,170)

(24,022)

Current tax liabilities

 

(1,140)

(883)

(366)

Obligations under finance leases

 

(272)

(211)

(111)

Deferred revenue

 

(3,468)

(2,686)

(3,269)

 

 

_________

__________

__________

 

 

(45,129)

(34,950)

(27,768)

 

 

 

 

 

Non-current liabilities

 

 

 

 

Trade and other payables

 

(12,168)

(9,423)

(8,445)

Obligations under finance leases

 

(6,403)

(4,959)

(1,540)

Deferred revenue

 

(6,915)

(5,355)

(6,725)

 

 

_________

__________

__________

Total liabilities

 

(70,615)

(54,687)

(44,478)

 

 

_________

__________

__________

Net assets

 

514,563

398,490

245,270

 

 

_________

__________

__________

 

 

 

 

 

Equity

 

 

 

 

Share capital

 

390

302

261

Share premium account

 

718,568

556,477

349,275

Other reserves

 

25,229

19,538

19,189

Accumulated deficit 

 

(229,624)

(177,827)

(123,455)

 

 

_________

__________

__________

 

 

Total equity

 

514,563

398,490

245,270

 

 

_________

__________

__________

 

 

 

Year ended

Year ended

Year ended

 

 

30 September 2016

30 September 2016

30 September 2015

 

 

$000’s

                £000’s

                £000’s

 

Loss for the year

(82,199)

(63,657)

(44,563)

 

Adjustments for:

 

 

 

 

Other income

(785)

(608)

(244)

 

Interest expense

223

173

75

 

Tax benefit

(29,073)

(22,515)

(12,498)

 

Depreciation of property, plant and equipment

4,654

3,605

2,250

 

Impairment of property, plant and equipment

606

 

Amortization of intangible assets

80

62

52

 

Net foreign exchange gains

(32,993)

(25,551)

(6,282)

 

Increase in provision for inventories

93

72

33

 

Decrease in deferred signature fees

(1,511)

(1,170)

(1,250)

 

Share-based payment charge

10,527

8,152

2,478

 

Loss on disposal of property, plant and equipment

1

1

1

 

 

__________

__________

__________

 

 

(130,983)

(101,436)

(59,342)

 

Decrease/(increase) in inventories

563

436

(12)

 

Increase in trade receivables and other assets

(972)

(753)

(1,010)

 

Increase in trade and other payables and deferred revenue

6,148

4,761

8,478

 

 

__________

__________

__________

 

Cash used in operations

(125,244)

(96,992)

(51,886)

 

Income taxes paid

(1,140)

(883)

 

Research and development tax credits received

17,150

13,281

5,415

 

 

__________

__________

__________

 

Net cash outflow from operating activities

(109,234)

(84,594)

(46,471)

 

 

__________

__________

__________

 

Investing activities

 

 

 

 

Interest received

560

434

236

 

Purchases of property, plant and equipment

(11,206)

(8,678)

(17,915)

 

Purchase of intangible assets

(661)

(512)

(114)

 

Proceeds from sales of property, plant and equipment

2

 

 

__________

__________

__________

 

Net cash outflow from investing activities

(11,307)

(8,756)

(17,791)

 

 

__________

__________

__________

 

Financing activities

 

 

 

 

Proceeds on exercise of share options

697

540

1,185

 

Proceeds of new equity issue

266,714

206,550

127,834

 

Expenses of new equity issue

(412)

(319)

(271)

 

Underwriters’ contribution towards expenses of new equity issue

609

472

 

Interest paid

(89)

(69)

(74)

 

Repayments of advance funding

(310)

(240)

 

Repayments of obligations under finance leases

(164)

(127)

(255)

 

 

__________

__________

__________

 

Net cash inflow from financing activities

267,045

206,807

128,419

 

 

__________

__________

__________

 

Effect of foreign exchange rate changes on cash and cash equivalents

33,655

26,063

6,224

 

 

__________

__________

__________

 

Net increase in cash and cash equivalents

180,159

139,520

70,381

 

Cash and cash equivalents at beginning of the year

303,286

234,872

164,491

 

 

__________

__________

__________

Cash and cash equivalents at end of the year

483,445

374,392

234,872

 

__________

__________

__________

               

 

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