Full Press Release Details
Aytu BioScience Provides Second Fiscal Quarter
Live Conference Call and Webcast TODAY at
Englewood, CO - February 16, 2016 - Aytu BioScience,
Inc. (OTCQX: AYTU), a specialty healthcare company focused on developing treatments for urological and related conditions,
provided today an overview of its business and growth strategy, as well as its financial results for the quarter ended December
Corporate Highlights:
Financial Highlights:
Josh Disbrow, Chief Executive Officer of Aytu BioScience, Inc.,
stated, "We've built considerable momentum since our formation in April of last year, and we believe we are poised for
significant growth over the coming quarters as we initiate commercialization of our acquired products and advance the development
of MiOXSYS in male infertility toward commercialization. We launched our commercial organization and have already begun to build
revenue for our initial products ProstaScint and Primsol. In parallel, we have continued to execute on our strategy of acquiring
valuable late-stage assets and best-in-class, specialty commercial products. We believe Aytu is well positioned for long-term incremental
growth based on our early commercial success with our expanding pipeline of substantially de-risked assets in the $10 billion global
In late November 2015, Aytu relaunched ProstaScint into the urology
market primarily targeting its existing user base in the U.S. and has already demonstrated prescription growth during the first
two full months of promotion. Aytu continues to anticipate booking approximately $1.7 million in revenue for this product in fiscal
2016 with expected revenue growth to follow.
The growth strategy for ProstaScint includes leveraging new data
regarding ProstaScint's superior clinical performance over existing diagnostics, expanding use by leveraging both product
indications in high-risk, newly diagnosed patients and recurrent patients, and seeking distribution partners in key markets outside
the U.S. in order to market ProstaScint globally - all of which hadn't been a priority for ProstaScint's prior
Aytu is preparing to relaunch Primsol, the only FDA-approved liquid
oral formulation of a gold standard antibiotic, trimethoprim, for treating uncomplicated urinary tract infections, or UTIs. Primsol
will utilize Aytu's existing U.S. urology sales channel, and similar to ProstaScint, Aytu expects revenue growth from both
products throughout calendar year 2016. Revenue from Aytu's commercial-stage assets will enable Aytu to scale its sales organization
accordingly and offset development costs as the Company advances MiOXSYS toward global commercialization for male infertility.
In early January 2016, Aytu received CE Marking for MiOXSYS, an
in vitro diagnostic device for male infertility, and within just weeks, the Company announced that it had begun booking
initial revenue for this product. In order to gain substantial, robust clinical experience using MiOXSYS, Aytu has engaged some
of the world's most influential clinicians and researchers in the field of andrology and infertility with the expectation
that they will present and publish compelling clinical utility data following their implementation of MiOXSYS in clinical settings.
In the relative near term, Aytu expects to establish a distribution network to begin growing sales in territories where MiOXSYS
is currently available commercially, as clinicians integrate MiOXSYS into their routine assessments of male infertility status.
Later this year, the Company expects to initiate the FDA process for MiOXSYS and begin formal clinical studies under the FDA 510k
Aytu reported nearly $1 million in revenue through the first half
of fiscal 2016 (ended December 31, 2015), and ended its fiscal second quarter 2016 with $11 million in cash and cash equivalents.
This strong cash position should enable the Company to execute on its strategic plan into fiscal 2017. Additionally, in February
2016, Aytu retired $4.1 million in debt principal from its September 2015 convertible debt offering, leaving only $1.05 million
in debt principal on the balance sheet.
On January 4, 2016, Ampio Pharmaceuticals executed its previously
announced strategy to distribute most of its 81.5% equity position in Aytu to Ampio shareholders. This key milestone event resulted
in Aytu becoming a free-standing company with a more liquid stock, forming a solid foundation for potential value creation.
Mr. Disbrow concluded, "We are committed to the continued
expansion of our commercial operations and to building significant value driven by sales from our novel urology product portfolio.
We've also made important strides to augment our liquidity and improve our capital structure, as well as increase our exposure
to new investors and potential strategic partners by presenting the Aytu story at numerous industry conferences. Based on our prior
experience building successful specialty healthcare companies, we believe this critical groundwork and our early achievements to
date place Aytu on a strong trajectory for delivering long-term value."
Conference Call Information:
Interested participants and investors may access the conference
call by dialing either:
The webcast will be accessible live
and archived on Aytu's website, www.aytubio.com, for 90 days.
A replay of the call will be available for seven days. Access the
replay by calling 1-877-344-7529 (U.S.) or 1-412-317-0088 (international) and using the replay access code 10081057.
About Aytu BioScience, Inc.
Aytu BioScience is a commercial-stage specialty healthcare company
focused on global commercialization of novel products in the field of urology. Aytu's current portfolio of commercial and
late-stage urology products addresses prostate cancer, urinary tract infections, male infertility and male sexual dysfunction,
and the company plans to expand into other urological indications for which there are significant medical needs. The Company currently
markets ProstaScint (capromab pendetide), the only radio-labeled monoclonal antibody that targets prostate specific
membrane antigen (PSMA), a protein highly expressed by prostate cancer cells. ProstaScint is FDA-approved as an imaging agent for
use in both newly diagnosed, high-risk prostate cancer patients and patients with recurrent prostate cancer. Aytu also markets
Primsol (trimethoprim hydrochloride) - the only FDA-approved trimethoprim-only oral solution for urinary
tract infections. Additionally, Aytu markets the CE Marked MiOXSYS System outside the U.S. and is conducting U.S.-based
clinical trials, following which the Company expects to receive 510k de novo medical device clearance. The MiOXSYS System
is a novel, rapid semen analysis system with the potential to become a standard of care in the diagnosis and management of male
infertility. MiOXSYS is the only rapid test for assessing oxidative stress in semen and seminal plasma, a leading contributor of
idiopathic male infertility. Aytu's strategy is to continue building its portfolio of revenue-generating urology products
and late-stage development assets, leveraging its commercial team and expertise to further build those brands within well-established
For Investors & Media:
Tiberend Strategic Advisors, Inc.
Joshua Drumm, Ph.D.: jdrumm@tiberend.com; (212) 375-2664
Janine McCargo: jmccargo@tiberend.com; (646) 604-5150
Forward Looking Statement
This press release includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, or the
Exchange Act. All statements other than statements of historical facts contained in this presentation, including statements regarding
our anticipated future clinical and regulatory events, future financial position, business strategy and plans and objectives of
management for future operations, are forward-looking statements. Forward looking statements are generally written in the future
tense and/or are preceded by words such as "may," "will," "should," "forecast,"
"could," "expect," "suggest," "believe," "estimate," "continue,"
"anticipate," "intend," "plan," or similar words, or the negatives of such terms or other variations
on such terms or comparable terminology. These statements are just predictions and are subject to risks and uncertainties that
could cause the actual events or results to differ materially. These risks and uncertainties include, among others: risks relating
to gaining market acceptance of our products, obtaining reimbursement by third-party payors, the potential future commercialization
of our product candidates, the anticipated start dates, durations and completion dates, as well as the potential future results,
of our ongoing and future clinical trials, the anticipated designs of our future clinical trials, anticipated future regulatory
submissions and events, our anticipated future cash position and future events under our current and potential future collaborations.
We also refer you to the risks described in "Risk Factors" in Part I, Item 1A of Aytu BioScience, Inc.'s Annual
Report on Form 10-K and in the other reports and documents we file with the Securities and Exchange Commission from time to time.
AYTU BIOSCIENCE, INC.
| December 31, 2015 | June 30, 2015 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 10,959,546 | $ | 7,353,061 | ||||
| Accounts receivable | 288,466 | 157,058 | ||||||
| Inventory | 653,115 | 39,442 | ||||||
| Prepaid expenses, other | 741,544 | 370,888 | ||||||
| Prepaid research and development - related party | 121,983 | 121,983 | ||||||
| Total current assets | 12,764,654 | 8,042,432 | ||||||
| Fixed assets, net | 143,826 | 29,706 | ||||||
| Developed technology, net | 1,242,569 | 780,125 | ||||||
| Customer contracts, net | 1,456,875 | 711,000 | ||||||
| Trade names, net | 210,139 | 79,000 | ||||||
| Goodwill | 221,000 | 74,000 | ||||||
| In-process research and development | 7,500,000 | 7,500,000 | ||||||
| Patents, net | 593,382 | 628,776 | ||||||
| Long-term portion of prepaid research & development - related party | 274,463 | 335,454 | ||||||
| Deposits | 2,888 | 4,886 | ||||||
| 11,645,142 | 10,142,947 | |||||||
| Total assets | $ | 24,409,796 | $ | 18,185,379 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities | $ | 1,076,295 | $ | 1,195,368 | ||||
| Primsol payable | 1,111,057 | - | ||||||
| Accrued compensation | 492,584 | 196,503 | ||||||
| Deferred revenue | 85,714 | 85,714 | ||||||
| Related party payable | 38,451 | - | ||||||
| Total current liabilities | 2,804,101 | 1,477,585 | ||||||
| Convertible promissory notes, net of amortization discount of $253,448 | 4,921,552 | - | ||||||
| Contingent consideration | 687,685 | 664,000 | ||||||
| Long-term deferred revenue | 383,036 | 425,893 | ||||||
| Interest payable | 161,988 | - | ||||||
| Deferred rent | 11,694 | 1,449 | ||||||
| Warrant derivative liability | 180,969 | - | ||||||
| Total liabilities | 9,151,025 | 2,568,927 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' equity | ||||||||
| Preferred Stock, par value $.0001; 50,000,000 shares authorized; none issued | - | - | ||||||
| Common Stock, par value $.0001; 300,000,000 shares authorized; shares issued and outstanding 14,259,693 and 14,259,681, respectively, as of December 31, 2015 and June 30, 2015 | 1,426 | 1,426 | ||||||
| Additional paid-in capital | 39,247,254 | 38,996,367 | ||||||
| Ampio stock subscription | - | (5,000,000 | ) | |||||
| Accumulated deficit | (23,989,909 | ) | (18,381,341 | ) | ||||
| Total stockholders' equity | 15,258,771 | 15,616,452 | ||||||
| Total liabilities and stockholders' equity | $ | 24,409,796 | $ | 18,185,379 |
AYTU BIOSCIENCE, INC.
Statements of Operations
| Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Product and service revenue | $ | 447,786 | $ | 6,906 | $ | 913,742 | $ | 13,060 | ||||||||
| License revenue | 21,428 | 21,429 | 42,857 | 42,858 | ||||||||||||
| Total revenue | 469,214 | 28,335 | 956,599 | 55,918 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Cost of sales | 244,100 | - | 281,425 | 225 | ||||||||||||
| Research and development | 1,308,460 | 789,967 | 2,164,334 | 1,723,720 | ||||||||||||
| Research and development - related party | 47,998 | 53,998 | 95,996 | 107,996 | ||||||||||||
| Sales, general and administrative | 1,774,167 | 749,837 | 3,425,971 | 1,863,416 | ||||||||||||
| Amortization of finite-lived intangible assets | 108,489 | 17,697 | 165,936 | 35,394 | ||||||||||||
| Total operating expenses | 3,483,214 | 1,611,499 | 6,133,662 | 3,730,751 | ||||||||||||
| Loss from operations | (3,014,000 | ) | (1,583,164 | ) | (5,177,063 | ) | (3,674,833 | ) | ||||||||
| Other (expense) income | ||||||||||||||||
| Interest (expense) | (240,214 | ) | (37,547 | ) | (353,467 | ) | (74,849 | ) | ||||||||
| Derivative (expense) | (78,166 | ) | - | (78,038 | ) | - | ||||||||||
| Total other (expense) income | (318,380 | ) | (37,547 | ) | (431,505 | ) | (74,849 | ) | ||||||||
| Net loss, before income tax | (3,332,380 | ) | (1,620,711 | ) | (5,608,568 | ) | (3,749,682 | ) | ||||||||
| Deferred income tax benefit | - | - | - | 23,910 | ||||||||||||
| Net loss | $ | (3,332,380 | ) | $ | (1,620,711 | ) | $ | (5,608,568 | ) | $ | (3,725,772 | ) | ||||
| Weighted average number of Aytu common shares outstanding | 14,259,693 | 7,901,426 | 14,259,687 | 7,901,426 | ||||||||||||
| Basic and diluted Aytu net loss per common share | $ | (0.23 | ) | $ | (0.21 | ) | $ | (0.39 | ) | $ | (0.47 | ) |
AYTU BIOSCIENCE, INC.
Statements of Cash Flows
| Six Months Ended December 31, | ||||||||
| 2015 | 2014 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | (5,608,568 | ) | $ | (3,725,772 | ) | ||
| Stock-based compensation expense | 250,887 | 477,660 | ||||||
| Depreciation, amortization and accretion | 242,427 | 49,164 | ||||||
| Amortization of debt issuance costs | 147,805 | - | ||||||
| Derivative expense | 78,038 | - | ||||||
| Amortization of prepaid research and development - related party | 60,991 | 60,992 | ||||||
| Deferred taxes | - | (23,910 | ) | |||||
| Adjustments to reconcile net loss to net cash used in operating activities | ||||||||
| (Increase) in accounts receivable | (131,408 | ) | (6,906 | ) | ||||
| (Increase) in inventory | (613,673 | ) | (10,453 | ) | ||||
| (Increase) decrease in prepaid expenses, other | (370,656 | ) | 485,889 | |||||
| (Increase) in prepaid research and development - related party | - | (150,000 | ) | |||||
| (Decrease) in accounts payable and accrued liabilities | (126,781 | ) | (298,677 | ) | ||||
| Increase (decrease) in related party payable | 38,451 | (561,059 | ) | |||||
| Increase in accrued compensation | 296,081 | 94,247 | ||||||
| Increase in interest payable | 161,988 | 74,936 | ||||||
| Increase in deferred rent | 10,245 | - | ||||||
| (Decrease) in deferred revenue | (42,857 | ) | (42,858 | ) | ||||
| Net cash used in operating activities | (5,607,030 | ) | (3,576,747 | ) | ||||
| Cash flows used in investing activities | ||||||||
| Deposits | 1,998 | (1,998 | ) | |||||
| Purchases of fixed assets | (125,161 | ) | - | |||||
| Purchase of Primsol business | (540,000 | ) | - | |||||
| Net cash used in investing activities | (663,163 | ) | (1,998 | ) | ||||
| Cash flows from financing activities | ||||||||
| Proceeds from convertible promissory notes, net | 5,175,000 | - | ||||||
| Debt issuance costs | (298,322 | ) | - | |||||
| Ampio stock subscription payment | 5,000,000 | - | ||||||
| Contribution from Ampio | - | 1,100,000 | ||||||
| Net cash provided by financing activities | 9,876,678 | 1,100,000 | ||||||
| Net change in cash and cash equivalents | 3,606,485 | (2,478,745 | ) | |||||
| Cash and cash equivalents at beginning of period | 7,353,061 | 2,639,650 | ||||||
| Cash and cash equivalents at end of period | $ | 10,959,546 | $ | 160,905 | ||||
| Non-cash transactions: | ||||||||
| Warrant derivative liability related to the issuance of the convertible promissory notes | $ | 102,931 | $ | - | ||||
| Primsol business purchase included in Primsol payable, $1,250,000 less future accretion of $173,000 | $ | 1,077,000 | $ | - | ||||
| Fixed asset purchases included in accounts payable | $ | 7,708 | $ | - |