Full Press Release Details
| I FIRST HALF 2019 INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | 2 | |||
| II MANAGEMENT DISCUSSION & ANALYSES | 24 | |||
| III INFORMATION REGARDING RELATIONSHIPS WITH RELATED PARTIES | 29 | |||
| IV RISK FACTORS | 30 |
I FIRST HALF OF 2019 CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
INTERIM CONDENSED STATEMENT OF CONSOLIDATED FINANCIAL POSITION
(thousands of euros)
| Note | 6/30/2019 | 12/31/2018 1 | ||||||||
| ASSETS | ||||||||||
| Intangible assets | 23 | 29 | ||||||||
| Right-of-use assets related to leases | 14 | 22,060 | ||||||||
| Property, plant, and equipment | 20,905 | 20,219 | ||||||||
| Other non-current financial assets | 4 | 6,144 | 6,033 | |||||||
| Total non-current assets | 49,131 | 26,281 | ||||||||
| Inventories | 2,082 | 1,566 | ||||||||
| Other current assets | 5 | 28,183 | 21,131 | |||||||
| Cash and cash equivalents | 6 | 107,265 | 122,770 | |||||||
| Total current assets | 137,531 | 145,468 | ||||||||
| TOTAL ASSETS | 186, 662 | 171,749 | ||||||||
| Note | 6/30/2018 | 12/30/2018 1 | ||||||||
| LIABILITIES | ||||||||||
| Shareholders equity | ||||||||||
| Share capital | 7 | 3,616 | 3,016 | |||||||
| Premiums related to the share capital | 7 | 605,223 | 539,292 | |||||||
| Reserves | 7 | (412,702 | ) | (254,946 | ) | |||||
| Net (loss) | 7 | (79,810 | ) | (166,076 | ) | |||||
| Total shareholders equity | 116,327 | 121,286 | ||||||||
| Non-current liabilities | ||||||||||
| Long-term financial debt | 8 | 1,003 | 1,278 | |||||||
| Long-term lease debt | 14 | 21,038 | ||||||||
| Non-current provisions | 1,620 | 1,536 | ||||||||
| Other non-current liabilities | 873 | 4,105 | ||||||||
| Total non-current liabilities | 24,533 | 6,919 | ||||||||
| Current liabilities | ||||||||||
| Short-term financial debt | 8 | 572 | 1,201 | |||||||
| Short-term lease debt | 14 | 3,162 | ||||||||
| Current provisions | 595 | 1,270 | ||||||||
| Supplier accounts payable | 9 | 22,308 | 28,567 | |||||||
| Other current liabilities | 9 | 19,164 | 12,506 | |||||||
| Total current liabilities | 45,801 | 43,543 | ||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS EQUITY | 186,662 | 171,749 |
INTERIM CONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS)
(thousands of euros, except per share information)
| Six months ended June 30, | ||||||||||
| Note | 2019 | 2018 2 | ||||||||
| Operating income | ||||||||||
| Revenues | 10 | |||||||||
| Other income | 10 | 7,062 | 7,283 | |||||||
| Total income | 7,062 | 7,283 | ||||||||
| Operating expenses | ||||||||||
| Cost of goods sold | ||||||||||
| Research and development | 11 | (52,238 | ) | (49,946 | ) | |||||
| Sales and marketing | 11 | (8,327 | ) | (9,728 | ) | |||||
| General and administrative | 11 | (25,825 | ) | (21,135 | ) | |||||
| Total expenses | (86,389 | ) | (80,809 | ) | ||||||
| Operating (loss) | (79,327 | ) | (73,526 | ) | ||||||
| Financial revenues | 13 | 491 | 1,813 | |||||||
| Financial expenses | 13 | (966 | ) | (360 | ) | |||||
| Financial (loss) profit | (475 | ) | 1,452 | |||||||
| Income tax | (8 | ) | ||||||||
| Net (loss) | (79,810 | ) | (72,074 | ) | ||||||
| Basic and diluted earnings per share ( /share) | (2.43 | ) | (2.60 | ) |
INTERIM CONDENSED CONSOLIDATED STATEMENTS
OF COMPREHENSIVE INCOME (LOSS)
(thousands of euros)
| Six months ended June 30 | ||||||||
| 2019 | 2018 3 | |||||||
| Net (loss) | (79,810 | ) | (72,074 | ) | ||||
| Actuarial gains and losses on employee benefits, net of corporate tax | 150 | 72 | ||||||
| Gain (Loss) directly recognized in shareholders equity | 150 | 72 | ||||||
| Other comprehensive income (loss) | 8 | (1,566 | ) | |||||
| Total comprehensive (loss) | (79,652 | ) | (73,568 | ) |
In accordance with IAS 1 Presentation of Financial Statements (2007) (IAS 1), the Group, as defined in Note 1, presents
a combined statement of other elements of comprehensive income or loss.
Other comprehensive income mainly includes, as of June 30, 2019 and 2018,
the change in consolidated translation reserves.
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
(thousands of euros)
| Note | 6/30/2019 | 6/30/2018 4 | ||||||||||
| Net profit (loss) for the period | (79,810 | ) | (72,074 | ) | ||||||||
| Reconciliation of the net profit (or loss) and the cash used for the operating activities: | ||||||||||||
| Amortization and depreciation | 2,437 | 162 | ||||||||||
| Retirement pension obligations | 233 | 190 | ||||||||||
| Expenses related to share-based compensation | 8,040 | 16,758 | ||||||||||
| Other elements | 515 | 242 | ||||||||||
| Operating cash flows before change in working capital | (68,584 | ) | (54,722 | ) | ||||||||
| Inventories | (516 | ) | ||||||||||
| Customer accounts receivable | 1,262 | |||||||||||
| Other current assets | (7,420 | ) | (10,163 | ) | ||||||||
| Supplier accounts payable | (5,945 | ) | 2,811 | |||||||||
| Other current and non-current liabilities | 5,296 | (4,357 | ) | |||||||||
| Change in working capital requirement | (8,585 | ) | (10,448 | ) | ||||||||
| Net cash flow used in operating activities | (77,170 | ) | (65,170 | ) | ||||||||
| Cash flows used in investing activities | ||||||||||||
| Acquisitions of property, plant, and equipment | (2,117 | ) | (498 | ) | ||||||||
| Acquisitions of intangible assets | 1 | (10 | ) | |||||||||
| Acquisitions of non-current financial assets | 16 | (171 | ) | |||||||||
| Net cash flows from investment activities | (2,100 | ) | (679 | ) | ||||||||
| Cash flows from financing activities | ||||||||||||
| Increase in conditional advances | ||||||||||||
| (Decrease) in conditional advances | (904 | ) | (648 | ) | ||||||||
| Treasury shares | 34 | (12 | ) | |||||||||
| Capital increases, net of transaction costs | 66,531 | 132,460 | ||||||||||
| Repayment of lease liabilities | (1,403 | ) | ||||||||||
| Interest paid on lease liabilities | (521 | ) | ||||||||||
| Other cash flows related to financing activities | (27 | ) | (135 | ) | ||||||||
| Net cash flows used in financing activities | 63,710 | 131,666 | ||||||||||
| (Decrease) in cash | (15,560 | ) | 65,817 | |||||||||
| Cash and cash equivalents at beginning period | 122,770 | 137,880 | ||||||||||
| Impact of exchange rate fluctuations | 55 | (1,452 | ) | |||||||||
| Cash and cash equivalents at the close of the period | 6 | 107,265 | 202,245 |
INTERIM CONDENSED STATEMENT OF CHANGES
IN CONSOLIDATED SHAREHOLDERS EQUITY
(thousands of euros)
| Shares of common Stock | ||||||||||||||||||||||||
| Number of shares (Note 7) | Amount | Premiums related to the share capital | Reserve | Profit (loss) | Total shareholders equity | |||||||||||||||||||
| At January 1, 2018 | 24 990 822 | 2,499 | 406,709 | (131,592 | ) | (147,693 | ) | 129,923 | ||||||||||||||||
| Net (loss) | (72,074 | ) | (72,074 | ) | ||||||||||||||||||||
| Foreign exchange translation | (1,566 | ) | (1,566 | ) | ||||||||||||||||||||
| Profit (loss) directly recognized in shareholders equity | 72 | 72 | ||||||||||||||||||||||
| Total profit (loss) directly recognized in shareholders equity | (1,494 | ) | (72,074 | ) | (73,568 | ) | ||||||||||||||||||
| Allocation of prior (loss) | (147,693 | ) | 147,693 | |||||||||||||||||||||
| Increase in capital | 5 015 530 | 502 | 131,821 | 132,323 | ||||||||||||||||||||
| Treasury shares | (650 | ) | (650 | ) | ||||||||||||||||||||
| Issue of share warrants | 138 | 138 | ||||||||||||||||||||||
| Share-based payments | 16,758 | 16,758 | ||||||||||||||||||||||
| At June 30, 2018 | 30 006 352 | 3,001 | 538,668 | (264,671 | ) | (72,074 | ) | 204,924 | ||||||||||||||||
| At January 1, 2018 | 24 990 822 | 2,499 | 406,709 | (131,592 | ) | (147,693 | ) | 129,923 | ||||||||||||||||
| Net (loss) | (166,076 | ) | (166,076 | ) | ||||||||||||||||||||
| Foreign exchange translation | (683 | ) | (683 | ) | ||||||||||||||||||||
| Profit (loss) directly recognized in shareholders equity | 19 | 19 | ||||||||||||||||||||||
| Total profit (loss) directly recognized in shareholders equity | (665 | ) | (166,076 | ) | (166,740 | ) | ||||||||||||||||||
| Allocation of prior (loss) | (147,693 | ) | 147,693 | |||||||||||||||||||||
| Increase in capital | 5 166 955 | 517 | 132,419 | 132,936 | ||||||||||||||||||||
| Treasury shares | (900 | ) | (900 | ) | ||||||||||||||||||||
| Issue of share warrants | 164 | 164 | ||||||||||||||||||||||
| Share-based payments | 25,904 | 25,904 | ||||||||||||||||||||||
| At December 31, 2018 | 30 157 777 | 3,016 | 539,292 | (254,946 | ) | (166,076 | ) | 121,286 | ||||||||||||||||
| At January 1, 2019 | 30 157 777 | 3,016 | 539,292 | (254,946 | ) | (166,076 | ) | 121,286 | ||||||||||||||||
| Net (loss) | (79,810 | ) | (79,810 | ) | ||||||||||||||||||||
| Foreign exchange translation | 8 | 8 | ||||||||||||||||||||||
| Profit (loss) directly recognized in shareholders equity | 150 | 150 | ||||||||||||||||||||||
| Total profit (loss) directly recognized in shareholders equity | 158 | (79,810 | ) | (79,652 | ) | |||||||||||||||||||
| Allocation of prior (loss) | (166,076 | ) | 166,076 | |||||||||||||||||||||
| Increase in capital | 6 000 000 | 600 | 65,931 | 66,531 | ||||||||||||||||||||
| Treasury shares | 122 | 122 | ||||||||||||||||||||||
| Share-based payments | 8,040 | 8,040 | ||||||||||||||||||||||
| At June 30, 2019 | 36 157 777 | 3,616 | 605,223 | (412,702 | ) | (79,810 | ) | 116,327 |
NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS
Incorporated in 2002 under the laws
of France, DBV Technologies S.A. ( DBV Technologies, or the Company ) is a clinical-stage specialty biopharmaceutical company focused on changing the field of immunotherapy by developing a novel technology platform called
Viaskin . The Company s therapeutic approach is based on epicutaneous immunotherapy, or EPIT , a proprietary method of delivering
biologically active compounds to the immune system through intact skin using Viaskin .
The Company s lead product candidate, Viaskin Peanut, has completed a global Phase III program
for the treatment of peanut-allergic patients 4 to 11 years of age. In October 2018, the Company announced its submission of a Biologics License Application ( BLA ) to the U.S. Food and Drug Administration ( FDA ) for Viaskin Peanut for the treatment of peanut allergy in children 4 to 11 years of age. On December 19, 2018, the Company announced that, after discussions with the FDA, the Company voluntarily
withdrew its Biologics License Application ( BLA ) for Viaskin Peanut in children 4 to 11 years of age. On August 7, 2019, the Company announced the submission of its BLA to
the FDA for Viaskin Peanut for the treatment of peanut-allergic children ages 4 to 11 years.
August 2017, the Company initiated Part A of the EPITOPE (EPIT in Toddlers with Peanut Allergy) trial, a Phase III trial of Viaskin
Peanut in peanut-allergic toddlers ages one to three. EPITOPE is a two-part, pivotal Phase III clinical trial assessing the safety and efficacy of
Viaskin Peanut 250 g for the treatment of peanut-allergic toddlers one to three years of age. In September 2018, the Company announced that the independent data safety and monitoring
board ( DSMB ) completed its review of Part A of EPITOPE and recommended that the dose of Viaskin Peanut 250 g be evaluated in Part B. On October 26, 2018, the Company
announced that the first patient was enrolled in Part B of EPITOPE. This trial is the second Phase III clinical program currently investigating the use of Viaskin Peanut for the treatment of
patients with peanut allergy.
The Company is developing its second product candidate, Viaskin Milk, for the treatment of cow s
milk protein allergy ( CMPA ), in children two to 17 years of age, which received fast track designation from the FDA in September 2016. In November 2014, the Company initiated a multi-center, double-blind, placebo-controlled, randomized
Phase I/II trial to study the safety and efficacy of Viaskin Milk in 198 patients with Immunoglobulin E ( IgE ) mediated CMPA, which the Company refers to as the Milk Efficacy and
Safety ( MILES ) trial. In June 2015, the Company announced completion of Part A of the MILES trial, or Phase I, and it launched Part B, or Phase II, in October 2015. In February 2018, the Company announced preliminary results from Part B
of the MILES trial. Following analyses of the data, the 300 g dose was identified as the dose with the greatest observed clinical activity for children
(intent-to-treat, p=0.042). The Company believes these preliminary results support further advancement of the
Viaskin Milk program and intends to discuss findings with regulatory authorities to determine the design of future clinical trials. All patients in the open-label extension trial were
switched to the 300 g dose for treatment of up to 24 months.
The Company is also working on a third product candidate, Viaskin Egg, for the treatment of patients
suffering from hen s egg allergy. Preclinical development for Viaskin Egg commenced in the first half of 2015 and is currently ongoing.
Other Viaskin application
In addition to the Company s development programs in food allergies, it is exploring the use of its
Viaskin technology for the treatment of inflammatory and autoimmune diseases with high unmet medical need. Human
proof-of-concept trials with Viaskin in Eosinophilic Esophagitis ( EoE ) and as a booster vaccination
against Bordetella pertussis (whooping cough) in healthy adults have been completed. The Company s other earlier stage research programs include vaccination for respiratory syncytial virus, as well as potential treatments for celiac disease and
Major events during the first half of 2019
On April 8, 2019, the Company announced the settlement and delivery of an underwritten global offering of an aggregate of 6,000,000 ordinary shares
reserved to specified categories of investors in (i) an offering of 2,447,500 ordinary shares in the form of 4,895,000 American Depositary Shares ( ADSs ) in the United States, Canada and certain other countries outside Europe, at an
offering price of $6.75 per ADS (on the basis of an exchange rate of $1.1233 = 1.00), and (ii) a private placement of 3,552,500 ordinary shares in Europe (including France), at an offering price of 12.02 per ordinary share. Each ADS
represents the right to receive one-half of one ordinary share. The gross proceeds to the Company from the global offering were approximately $81.0 million (approximately 72.1 million), before
deducting underwriting commissions and estimated offering expenses.
On February 13, 2019, the Company announced that it expects to submit its BLA to the FDA for
Viaskin Peanut for the treatment of peanut-allergic children 4 to 11 years of age in the third quarter of 2019.
On August 7, 2019, the Company announced the submission on August 6, 2019 of its BLA to the FDA for Viaskin Peanut for the treatment of peanut-allergic children ages 4 to 11 years.
2019, the Company announced the following changes to its leadership team as the Company strengthens its organizational competencies in the development of the Viaskin platform:
On March 5, 2019, the Company also provided an update
on leadership and operational changes:
On March 5, 2019, the board of directors
appointed existing board member, Michel de Rosen, as Non-Executive Chairman of the board. Mr. de Rosen succeeds the Company s co-founder, Dr. Benhamou,
who retired from his position as DBV s Non-Executive Chairman and board member. Dr. Benhamou joined the Company s Scientific Advisory Board on March 5, 2019. In addition, Daniel
Tass , CEO of DBV Technologies, has been appointed to the Board of Directors to replace Pierre-Henri Benhamou. This appointment was approved by the Annual General Meeting of Shareholders held on May 24, 2019.
On May 14, 2019, the Company announced that its Deputy Chief Executive Officer and Principal Financial
Officer, David Schilansky, has decided to leave the company by the end of August 2019. While a new Chief Financial Officer search is underway, DBV will not fill the Deputy CEO role following David Schilansky s departure. S bastien
Robitaille has been appointed to serve as the Company s interim Chief Financial Officer and Principal Financial Officer, effective as of August 31, 2019.
On May 24, 2019, the Company also announced that Viviane Monges, who has 30 years of global pharmaceutical leadership experience in financial operations,
has been appointed to the Board of Directors and Audit Committee. DBV s Board of Directors now includes nine directors, including four women.
June 26, 2019, the Company announced the appointment of Pharis Mohideen, M.D., as its CMO, effective July 22, 2019. Dr. Mohideen serves as a member of the Executive Committee and reports to Daniel Tass . Effective as of
Dr. Mohideen s start date, Dr. Hugh Sampson, who assumed the role of interim CMO in early 2019, continued to serve as CSO.
A class action complaint was filed on January 15, 2019, in the United States District Court for the District of New Jersey, entitled Travis Ito-Stone v. DBV Technologies, et al., Case No. 2:19-cv-00525. The complaint alleges that the Company and its former Chief Executive
Officer, its current Chief Executive Officer and its former Deputy Chief Executive Officer violated certain federal securities laws, specifically under Sections 10(b) and 20(a) of the Exchange Act, and Rule
10b-5 promulgated thereunder.
The plaintiff seeks unspecified damages on behalf of a purported class of
purchasers of the Company s securities between February 14, 2018 and December 19, 2018. The Company believes that the allegations contained in the complaint are without merit and intend to defend the case vigorously. However, whether
or not the plaintiff s claims are successful, this type of litigation is often expensive and diverts management s attention and resources, which could adversely affect the operation of the Company s business. If the Company is
ultimately required to pay significant defense costs, damages or settlement amounts, such payments could adversely affect its operations.
be the target of similar litigation in the future. Any future litigation could result in substantial costs and divert management s attention and resources, which could cause serious harm to the Company s business, operating results and
financial condition. The company maintains liability insurance; however, if any costs or expenses associated with this or any other litigation exceed its insurance coverage, the Company may be forced to bear some or all of these costs and expenses
directly, which could be substantial.
Note 2: General principles and statement of compliance
The company DBV Technologies Inc. was incorporated in Delaware on April 7, 2015 (the US subsidiary ). The share capital of this US subsidiary
is 100% owned by DBV Technologies S.A. ( DBV Technologies ).
The company DBV Australia Pty Ltd. was incorporated in New South Wales, Australia
on July 3, 2018 (the Australian subsidiary ). The share capital of this Australian subsidiary is 100% owned by DBV Technologies S.A. ( DBV Technologies ).
The company DBV Canada Ltd. was incorporated in Ottawa, Ontario on August 13, 2018 (the Canadian subsidiary ). The share capital of this
Canadian subsidiary is 100% owned by DBV Technologies S.A. ( DBV Technologies ).
The company DBV Pharma was incorporated in Paris on
December 21, 2018 (the French subsidiary ). The share capital of this French subsidiary is 100% owned by DBV Technologies S.A. ( DBV Technologies ).
The interim consolidated condensed financial statements (the Financial Statements ) present the operations of DBV Technologies S.A. and its
subsidiaries (the Group ) as of June 30, 2019. DBV Technologies is a Corporate French venture under French law (soci t anonyme) and has its registered offices located at 177/181 avenue Pierre Brossolette, 92120
The interim condensed consolidated financial statements at June 30, 2019 have been prepared under the responsibility of the
management of DBV Technologies. These interim condensed financial statements were approved by the Board of Directors of the Company on September 20, 2019.
The interim condensed consolidated financial statements of the Group are expressed in thousands of euros unless stated otherwise.