Full Press Release Details
Fortress Biotech Reports First Quarter
2017 Financial Results and Recent Corporate Highlights
New York, NY - May 10, 2017
- Fortress Biotech, Inc. (NASDAQ: FBIO) ("Fortress"), a biopharmaceutical company dedicated to acquiring, developing
and commercializing novel pharmaceutical and biotechnology products, today announced its financial results and recent corporate
highlights for the quarter ended March 31, 2017.
Dr. Lindsay A. Rosenwald, Fortress'
Chairman, President and Chief Executive Officer, said, "Fortress had a strong start to 2017, with the launch of our subsidiaries
Caelum Biosciences and Cyprium Therapeutics, which we believe strengthens our rare disease portfolio. Importantly, we announced
a Cooperative Research and Development Agreement between Cyprium and the NICHD to advance the clinical development of Cyprium's
Phase 3 candidate CUTX-101 in Menkes disease, a rare and devastating pediatric illness. We also reported that Caelum announced
the dosing of the final patient in its Phase 1b study of CAEL-101 for the treatment of AL amyloidosis, a fatal orphan disease that
affects organ function. In addition, our established subsidiaries continued to deliver on key milestones, including Mustang Bio
raising a total of approximately $95.0 million in private placement financings to support its CAR T pipeline. We look forward to
the continued clinical advancement of our Fortress Companies, and are evaluating opportunities to expand our portfolio through
compelling new indications and in-licensing opportunities."
Recent Fortress Biotech and Fortress Company Highlights:
Fortress Biotech, Inc.
Avenue Therapeutics, Inc.
Caelum Biosciences, Inc.
Checkpoint Therapeutics, Inc.
Cyprium Therapeutics, Inc.
About Fortress Biotech
Biotech, Inc. ("Fortress") is a biopharmaceutical company dedicated to acquiring, developing and commercializing novel
pharmaceutical and biotechnology products. Fortress develops and commercializes products both within Fortress and through certain
subsidiary companies, also known as Fortress Companies. In addition to its internal development programs, Fortress leverages its
biopharmaceutical business expertise and drug development capabilities and provides funding and management services to help the
Fortress Companies achieve their goals. Fortress and the Fortress Companies may seek licensings, acquisitions, partnerships, joint
ventures and/or public and private financings to accelerate and provide additional funding to support their research and development
programs. For more information, visit www.fortressbiotech.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. 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. 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; our dependence on third-party suppliers;
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; as well as other risks described
in our SEC filings. 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 required by law.
Lucy Lu, M.D., Executive Vice President & Chief Financial
Fortress Biotech, Inc.
Fortress Biotech Media Relations
FORTRESS BIOTECH, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
($ in thousands except for share and
| March 31, | December 31, | |||||||
| 2017 | 2016 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 134,037 | $ | 88,294 | ||||
| Accounts receivable | 1,368 | 1,830 | ||||||
| Cash deposits with clearing organizations | 1,030 | 1,030 | ||||||
| Receivables from broker-dealers and clearing organizations | 2,858 | 3,357 | ||||||
| Forgivable loans receivable | 1,528 | 1,712 | ||||||
| Securities owned, at fair value | 1,206 | 2,357 | ||||||
| Inventory | 204 | 203 | ||||||
| Other receivables - related party | 1,034 | 1,790 | ||||||
| Prepaid expenses and other current assets | 8,542 | 9,061 | ||||||
| Total current assets | 151,807 | 109,634 | ||||||
| Property and equipment, net | 7,386 | 7,376 | ||||||
| Restricted cash | 15,860 | 15,860 | ||||||
| Long-term investments, at fair value | 746 | 1,414 | ||||||
| Intangible assets | 17,077 | 17,408 | ||||||
| Goodwill | 18,645 | 18,645 | ||||||
| Other assets | 390 | 394 | ||||||
| Total assets | $ | 211,911 | $ | 170,731 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | 24,864 | $ | 23,871 | ||||
| Accrued commissions and payroll payable | 10,190 | 11,940 | ||||||
| Contingent consideration payable | 623 | 424 | ||||||
| Deferred clearing and marketing credits | 943 | 995 | ||||||
| Securities sold, not yet purchased, at fair value | 1 | 298 | ||||||
| Warrants issuable - National | 10,096 | 14,359 | ||||||
| Interest payable | 89 | 88 | ||||||
| Interest payable - related party | 96 | 77 | ||||||
| Notes payable, short-term | 2,105 | 1,000 | ||||||
| Subsidiary convertible note, short-term, at fair value | 3,147 | 1,031 | ||||||
| Contingently issuable liabilities | - | 1,682 | ||||||
| Derivative warrant liability | 402 | 481 | ||||||
| Other current liabilities | 244 | 319 | ||||||
| Total current liabilities | 52,800 | 56,565 | ||||||
| Notes payable, long-term (net of debt discount of $2,549 and $2,009 at March 31, 2017 and December 31, 2016, respectively) | 26,137 | 22,528 | ||||||
| Subsidiary convertible note, long-term, at fair value | 1,637 | 3,656 | ||||||
| Other long-term liabilities | 5,020 | 5,014 | ||||||
| Total liabilities | 85,594 | 87,763 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' equity | ||||||||
| Convertible Preferred stock, $.001 par value, 129,767 Series C shares authorized, 0 shares issued and outstanding as of March 31, 2017 and December 31, 2016, respectively | - | - | ||||||
| Common Stock, $.001 par value, 100,000,000 shares authorized, 50,319,919 and 48,932,023 shares issued and outstanding as of March 31, 2017 and December 31, 2016, respectively | 50 | 49 | ||||||
| Additional paid-in-capital | 304,929 | 283,697 | ||||||
| Accumulated deficit | (257,233 | ) | (245,251 | ) | ||||
| Total stockholders' equity attributed to the Company | 47,746 | 38,495 | ||||||
| Non-controlling interests | 78,571 | 44,473 | ||||||
| Total stockholders' equity | 126,317 | 82,968 | ||||||
| Total liabilities and stockholders' equity | $ | 211,911 | $ | 170,731 |
FORTRESS BIOTECH, INC. AND SUBSIDIARIES
Condensed Consolidated Statement of Operations
($ in thousands except for share and
| For the Three Months Ended March 31, | ||||||||
| 2017 | 2016 | |||||||
| Revenue | ||||||||
| Fortress | ||||||||
| Product revenue, net | $ | 2,085 | $ | 383 | ||||
| Revenue - from a related party | 693 | 277 | ||||||
| Net Fortress revenue | 2,778 | 660 | ||||||
| National | ||||||||
| Commissions | 24,506 | - | ||||||
| Net dealer inventory gains | 2,511 | - | ||||||
| Investment banking | 7,061 | - | ||||||
| Investment advisory | 3,385 | - | ||||||
| Interest and dividends | 716 | - | ||||||
| Transfer fees and clearing services | 2,498 | - | ||||||
| Tax preparation and accounting | 856 | - | ||||||
| Other | 371 | - | ||||||
| Total National revenue | 41,904 | - | ||||||
| Net revenue | 44,682 | 660 | ||||||
| Operating expenses | ||||||||
| Fortress | ||||||||
| Cost of goods sold - product revenue | 469 | - | ||||||
| Research and development | 7,110 | 7,736 | ||||||
| Research and development - licenses acquired | 1,294 | 83 | ||||||
| General and administrative | 10,252 | 7,932 | ||||||
| Total Fortress operating expenses | 19,125 | 15,751 | ||||||
| National | ||||||||
| Commissions, compensation and fees | 37,258 | - | ||||||
| Clearing fees | 738 | - | ||||||
| Communications | 722 | - | ||||||
| Occupancy | 1,008 | - | ||||||
| Licenses and registration | 405 | - | ||||||
| Professional fees | 1,263 | - | ||||||
| Interest | 4 | - | ||||||
| Depreciation and amortization | 506 | - | ||||||
| Other administrative expenses | 1,230 | - | ||||||
| Total National operating expenses | 43,134 | - | ||||||
| Total operating expenses | 62,259 | 15,751 | ||||||
| Loss from operations | (17,577 | ) | (15,091 | ) | ||||
| Other income (expenses) | ||||||||
| Interest income | 136 | 75 | ||||||
| Interest expense and financing fee | (698 | ) | (620 | ) | ||||
| Change in fair value of derivative liabilities | 4,342 | (89 | ) | |||||
| Change in fair value of subsidiary convertible note | (97 | ) | - | |||||
| Change in fair value of investments | (668 | ) | (918 | ) | ||||
| Total other income (expenses) | 3,015 | (1,552 | ) | |||||
| Net loss | (14,562 | ) | (16,643 | ) | ||||
| Net loss attributable to non-controlling interests | (2,580 | ) | (4,438 | ) | ||||
| Net loss attributable to common stockholders | $ | (11,982 | ) | $ | (12,205 | ) | ||
| Basic and diluted net loss per common share | $ | (0.30 | ) | $ | (0.31 | ) | ||
| Weighted average common shares outstanding-basic and diluted | 40,357,711 | 39,658,188 |