Full Press Release Details
Journey Medical Corporation Reports Second Quarter
2022 Financial Results and Recent Corporate Highlights
net revenue increased 20% to $18.3 million versus the same quarter of 2021
DFD-29 Phase 3 studies
45% enrolled to date; 9 additional sites underway in Europe open to enrollment
Top-line data anticipated
from the Phase 3 clinical program evaluating DFD-29 for the treatment of papulopustular rosacea in the first half of 2023
Company to hold conference
call on August 9, 2022 at 4:30 p.m. ET
Scottsdale, AZ - August 9, 2022 -
Journey Medical Corporation (NASDAQ: DERM) ("Journey Medical" or the "Company"), a commercial-stage pharmaceutical
company that focuses on the development and commercialization of pharmaceutical products for the treatment of dermatological conditions,
today announced financial results and recent corporate highlights for the second quarter and six months ended June 30, 2022.
Claude Maraoui, Journey Medical's Co-Founder,
President, and Chief Executive Officer said, "We generated net revenues of $18.3 million in the second quarter of 2022, which represents
an increase of 20% from the same quarter last year. Additionally, the settlement agreements executed with Padagis US LLC ("Padagis")
earlier this quarter assisted in solidifying Journey Medical's exclusivity of our three newest products, QBREXZA ,
and provide a clear pathway that we expect will allow us to grow the sales of these products for years to come."
"Enrollment in our two DFD-29 Phase 3 studies
is progressing well in the U.S. and we are currently enrolling patients in Europe. Looking ahead, we expect to announce top-line data
from our DFD-29 program for the treatment of papulopustular rosacea in the first half of 2023. A New Drug Application ("NDA")
filing is subsequently expected in the second half of 2023. We also anticipate launching an additional product in the second half of 2022,
which will be Journey Medical's tenth marketed dermatology product," concluded Mr. Maraoui.
Recent Corporate Highlights:
Conference Call and Webcast Information
Journey Medical management will conduct a conference
call and audio webcast at 4:30 p.m. ET on August 9, 2022.
To listen to the conference call, interested
parties within the U.S. should dial 1-866-777-2509 (domestic) or 1-412-317-5413 (international). All callers should dial in approximately
10 minutes prior to the scheduled start time and ask to be joined into the Journey Medical conference call. Participants can register
for the conference here: https://dpregister.com/sreg/10169666/f3cc96d568. Please note that registered participants will receive
their dial-in number upon registration.
A live audio webcast can be accessed on the News
and Events page of the Investors section of Journey Medical's website, www.journeymedicalcorp.com, and will remain available
for replay for approximately 30 days after the meeting.
About Journey Medical Corporation
Journey Medical Corporation (NASDAQ: DERM) ("Journey
Medical") is focused on identifying, acquiring, developing and strategically commercializing innovative, differentiated dermatology
products through its efficient sales and marketing model. The company currently markets nine products that help treat and heal common
skin conditions. The Journey Medical team is comprised of industry experts with extensive experience commercializing some of the most
successful prescription dermatology brands. Journey Medical is located in Scottsdale, Arizona and was founded by Fortress Biotech, Inc.
(NASDAQ: FBIO). Journey Medical's common stock is registered under the Securities Exchange Act of 1934, as amended, and it files
periodic reports with the U.S. Securities and Exchange Commission ("SEC"). For additional information about Journey Medical,
visit www.journeymedicalcorp.com.
Forward-Looking Statements
This press release may contain "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934,
as amended. As used below and throughout this press release, the words "we", "us" and "our" may refer
to Journey Medical. Such statements include, but are not limited to, any statements relating to our growth strategy and product development
programs and any other statements that are not historical facts. The words "anticipate," "believe," "estimate,"
"may," "expect," "will," "could," "project," "intend" and similar
expressions are generally intended to identify forward-looking statements. Forward-looking statements are based on management's
current expectations and are subject to risks and uncertainties that could negatively affect our business, operating results, financial
condition and stock price. Factors that could cause actual results to differ materially from those currently anticipated include: risks
relating to our growth strategy; our ability to obtain, perform under and maintain financing and strategic agreements and relationships;
risks relating to the results of research and development activities; uncertainties relating to preclinical and clinical testing; risks
relating to the timing of starting and completing clinical trials, including disruptions that may result from hostilities in Europe; our
dependence on third-party suppliers; risks relating to the COVID-19 outbreak and its potential impact on our employees' and consultants'
ability to complete work in a timely manner and on our ability to obtain additional financing on favorable terms or at all; our ability
to attract, integrate and retain key personnel; the early stage of products under development; our need for substantial additional funds;
government regulation; patent and intellectual property matters; competition; potential recovery of funds lost from previously disclosed
cyber security breaches; as well as other risks described in Part I, Item 1A, "Risk Factors," in our Annual Report on Form
10-K filed on March 28, 2022, subsequent Reports on Form 10-Q, and our other filings we make with the SEC. We expressly disclaim any obligation
or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in
our expectations or any changes in events, conditions or circumstances on which any such statement is based, except as may be required
by law, and we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform
Jaclyn Jaffe and Bill Begien
Media Relations Contact:
JOURNEY MEDICAL CORPORATION
Consolidated Balance Sheets
(Dollars in thousands
except for share and per share amounts)
| June 30, | December 31, | |||||||
| 2022 | 2021 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 38,142 | $ | 49,081 | ||||
| Accounts receivable, net of reserves | 28,671 | 23,112 | ||||||
| Inventory | 16,053 | 9,862 | ||||||
| Prepaid expenses and other current assets | 1,035 | 2,438 | ||||||
| Total current assets | 83,901 | 84,493 | ||||||
| Intangible assets, net | 29,440 | 12,552 | ||||||
| Operating lease right-of-use asset, net | 45 | 89 | ||||||
| Other assets | 110 | 150 | ||||||
| Total assets | $ | 113,496 | $ | 97,284 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 32,750 | $ | 22,812 | ||||
| Due to related party | 357 | 641 | ||||||
| Accrued expenses | 19,368 | 22,733 | ||||||
| Accrued interest | 77 | - | ||||||
| Income taxes payable | 12 | 8 | ||||||
| Line of credit | - | 812 | ||||||
| Deferred cash payment (net of discount of $141) | 4,859 | - | ||||||
| Installment payments - licenses, short-term | 2,628 | 4,510 | ||||||
| Operating lease liabilities | 49 | 98 | ||||||
| Total current liabilities | 60,100 | 51,614 | ||||||
| Term loan (net of debt discount of $207) | 14,793 | - | ||||||
| Installment payments - licenses, long-term | 3,808 | 3,627 | ||||||
| Total liabilities | 78,701 | 55,241 | ||||||
| Stockholders' equity | ||||||||
| Common stock, $.0001 par value, 50,000,000 shares authorized, 11,556,493 and 11,316,344 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively | 1 | 1 | ||||||
| Common stock - Class A, $.0001 par value, 50,000,000 shares authorized, 6,000,000 shares issued and outstanding as of June 30, 2022 and December 31, 2021 | 1 | 1 | ||||||
| Additional paid-in capital | 82,573 | 80,915 | ||||||
| Accumulated deficit | (47,780 | ) | (38,874 | ) | ||||
| Total stockholders' equity | 34,795 | 42,043 | ||||||
| Total liabilities and stockholders' equity | $ | 113,496 | $ | 97,284 |
Condensed Consolidated Statements of Operations
in thousands except for share and per share amounts)
| Three-Month Periods Ended | Six-Month Periods Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Revenue: | ||||||||||||||||
| Product revenue, net | $ | 18,235 | $ | 15,288 | $ | 39,031 | $ | 26,007 | ||||||||
| Other revenue | 56 | - | 2,556 | - | ||||||||||||
| Total Revenue | 18,291 | 15,288 | 41,587 | 26,007 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Cost of goods sold - product revenue | 7,633 | 7,484 | 15,836 | 11,392 | ||||||||||||
| Research and development | 2,609 | 29 | 3,875 | 29 | ||||||||||||
| Research and development - licenses acquired | - | 13,743 | - | 13,743 | ||||||||||||
| Selling, general and administrative | 15,191 | 7,795 | 29,906 | 14,021 | ||||||||||||
| Total operating expenses | 25,433 | 29,051 | 49,617 | 39,185 | ||||||||||||
| Loss from operations | (7,142 | ) | (13,763 | ) | (8,030 | ) | (13,178 | ) | ||||||||
| Other expense | ||||||||||||||||
| Interest income | (4 | ) | - | (7 | ) | - | ||||||||||
| Interest expense | 454 | 1,342 | 843 | 1,563 | ||||||||||||
| Change in fair value of derivative liability | - | 182 | - | 182 | ||||||||||||
| Total other expense | 450 | 1,524 | 836 | 1,745 | ||||||||||||
| Loss before income taxes | (7,592 | ) | (15,287 | ) | (8,866 | ) | (14,923 | ) | ||||||||
| Income tax (benefit) expense | (64 | ) | (3,422 | ) | 40 | (3,326 | ) | |||||||||
| Net Loss | $ | (7,528 | ) | $ | (11,865 | ) | $ | (8,906 | ) | $ | (11,597 | ) | ||||
| Net loss per common share: | ||||||||||||||||
| Basic and diluted | $ | (0.43 | ) | $ | (1.30 | ) | $ | (0.51 | ) | $ | (1.27 | ) | ||||
| Weighted average number of common shares: | ||||||||||||||||
| Basic and diluted | 17,455,894 | 9,161,333 | 17,386,538 | 9,159,841 |
Use of Non-GAAP Measures:
In addition to the GAAP financial measures as
presented in our Form 10-Q that will be filed with the Securities and Exchange Commission ("SEC"), the Company has, in this
press release, included certain non-GAAP measurements, including Adjusted EBITDA (Adjusted Operating Net Income (loss)), Adjusted Operating
Net Income (loss) per share basic and Adjusted Net Income (loss) per share diluted. We define Adjusted EBITDA (Adjusted Operating Net
Income (loss)) as net income (loss) excluding interest, taxes and depreciation, less certain other non-cash items, namely, share-based
compensation expense, amortization of acquired intangible assets, inventory step-ups from the purchases of intangibles assets and products,
as more fully described as follows:
Adjusted Operating Net Income (loss) per share
basic and Adjusted Net Income (loss) per share diluted are determined by dividing the resulting Adjusted EBITDA (Adjusted Operating Net
Income (loss)) by the number of shares outstanding on an actual and fully diluted basis.
Management believes use of these non-GAAP measures
provide meaningful supplemental information regarding the Company's performance because (i) it allows for greater transparency with
respect to key measures used by management in its financial and operational decision-making, (ii) it excludes the impact of non-cash or,
when specified, non-recurring items that are not directly attributable to the Company's core operating performance and that may
obscure trends in the Company's core operating performance and (iii) it is used by institutional investors and the analyst community
to help analyze the Company's results. However, Adjusted EBTIDA (Adjusted Operating Net Income (loss)), Adjusted Operating Net Income
(loss) per share basic, Adjusted Net Income (loss) per share diluted and any other non-GAAP financial measures should be considered as
a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Further,
non-GAAP financial measures used by the Company and the manner in which they are calculated may differ from the non-GAAP financial measures
or the calculations of the same non-GAAP financial measures used by other companies, including the Company's competitors.
The table below provides a reconciliation from
GAAP to non-GAAP measures: