Full Press Release Details
Biotech Reports Fourth Quarter and Full-Year 2017 Financial Results and Recent Corporate Highlights
New York, NY - March 16, 2018
- Fortress Biotech, Inc. (NASDAQ: FBIO) ("Fortress"), a biopharmaceutical company dedicated to acquiring, developing
and commercializing novel pharmaceutical and biotechnology products, today announced financial results and recent corporate highlights
for the fourth quarter and full year ended December 31, 2017.
Lindsay A. Rosenwald, M.D., Fortress Biotech's
Chairman, President and Chief Executive Officer, said, "In 2017, we continued to build our portfolio of subsidiary companies,
with the launch of Aevitas Therapeutics, Caelum Biosciences, Cyprium Therapeutics and Tamid Bio, strengthening our position in
gene therapy and rare disease. In addition, our established Fortress Companies achieved several significant milestones, including
the expansion of Mustang Bio's CAR T pipeline and a partnership with Harvard University and Beth Israel Deaconess Medical
Center for the development of CRISPR/Cas9-enhanced CAR T therapies. In the third quarter of 2017, Mustang announced an exclusive,
worldwide licensing agreement with the Fred Hutchinson Cancer Research Center for CD20-specific CAR T technology, which is currently
in a Phase 1/2 clinical trial at Fred Hutch evaluating the safety and efficacy of the CD20 technology in patients with relapsed
or refractory B-cell non-Hodgkin lymphomas. Other significant milestones achieved by our Fortress Companies include an FDA RMAT
designation for Cellvation's CEVA101 in severe traumatic brain injury, the dosing of a pivotal Phase 3 trial of Avenue Therapeutics'
IV tramadol in postoperative pain and the Nasdaq listing of three Fortress Companies."
Dr. Rosenwald continued, "The year
culminated with the presentation of clinical data on Caelum's CAEL-101 and Mustang's MB-102 in oral sessions at the
American Society of Hematology Annual Meeting in December. In 2018, we look forward to building on the momentum of 2017, as we
continue to advance promising therapies through clinical development and evaluate additional opportunities to fortify our portfolio."
2017 and Recent Fortress Biotech and Fortress Company
Fortress Biotech, Inc.
Aevitas Therapeutics, Inc.
Avenue Therapeutics, Inc.
Caelum Biosciences, Inc.
Checkpoint Therapeutics, Inc.
Cyprium Therapeutics, Inc.
About Fortress Biotech
Fortress 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 licensing arrangements, 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 may be required by law.
Fortress Biotech, Inc.
Investor Relations Contact:
Managing Director, LifeSci Advisors, LLC
Media Relations Contact:
FORTRESS BIOTECH, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
($ in thousands except for share and
| December 31, | ||||||||
| 2017 | 2016 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 113,915 | $ | 88,294 | ||||
| Accounts receivable | 7,758 | 1,830 | ||||||
| Short-term investments (certificates of deposit) | 36,002 | - | ||||||
| Cash deposits with clearing organizations | 1,041 | 1,030 | ||||||
| Receivables from broker-dealers and clearing organizations | 7,395 | 3,357 | ||||||
| Forgivable loans receivable | 1,616 | 1,712 | ||||||
| Securities owned, at fair value | 1,985 | 2,357 | ||||||
| Inventory | 171 | 203 | ||||||
| Other receivables - related party | 618 | 1,790 | ||||||
| Prepaid expenses and other current assets | 12,680 | 9,061 | ||||||
| Total current assets | 183,181 | 109,634 | ||||||
| Property and equipment, net | 9,513 | 7,376 | ||||||
| Restricted cash | 17,387 | 15,860 | ||||||
| Long-term investments, at fair value | 1,390 | 1,414 | ||||||
| Intangible assets | 15,223 | 17,408 | ||||||
| Goodwill | 18,645 | 18,645 | ||||||
| Other assets | 611 | 394 | ||||||
| Total assets | $ | 245,950 | $ | 170,731 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | 36,127 | $ | 24,295 | ||||
| Accounts payable and accrued expenses - related party | 222 | - | ||||||
| Accrued commissions and payroll payable | 10,065 | 11,940 | ||||||
| Deferred clearing and marketing credits | 786 | 995 | ||||||
| Securities sold, not yet purchased, at fair value | 151 | 298 | ||||||
| Warrants issued in 2017 and issuable in 2016 - National | 5,597 | 14,359 | ||||||
| Interest payable | 315 | 88 | ||||||
| Interest payable - related party | 669 | 77 | ||||||
| Notes payable, short-term (net of debt discount of $973 and $0 at December 31, 2017 and December 31, 2016, respectively) | 8,528 | 1,000 | ||||||
| Subsidiary convertible note, short-term, at fair value | 4,700 | 1,031 | ||||||
| Contingently issuable liabilities | - | 1,682 | ||||||
| Derivative warrant liability | 87 | 481 | ||||||
| Other current liabilities | 181 | 319 | ||||||
| Total current liabilities | 67,428 | 56,565 | ||||||
| Notes payable, long-term (net of debt discount of $62 and $2,009 at December 31, 2017 and December 31, 2016, respectively) | 43,222 | 22,528 | ||||||
| Subsidiary convertible note, long-term, at fair value | 10,059 | 3,656 | ||||||
| Other long-term liabilities | 4,739 | 5,014 | ||||||
| Total liabilities | 125,448 | 87,763 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' equity | ||||||||
| Preferred stock, $.001 par value, 15,000,000 authorized, 5,000,000 designated Series A shares 1,000,000 and 0 shares issued and outstanding as of December 31, 2017 and December 31, 2016, respectively | 1 | - | ||||||
| Common Stock, $.001 par value, 100,000,000 shares authorized, 50,991,285 and 48,932,023 shares issued and outstanding as of December 31, 2017 and December 31, 2016, respectively | 51 | 49 | ||||||
| Common stock issuable, 158,015 and 0 shares as of December 31, 2017 and December 31, 2016, respectively | 500 | - | ||||||
| Additional paid-in-capital | 364,148 | 283,697 | ||||||
| Accumulated deficit | (312,127 | ) | (245,251 | ) | ||||
| Total stockholders' equity attributed to the Company | 52,573 | 38,495 | ||||||
| Non-controlling interests | 67,929 | 44,473 | ||||||
| Total stockholders' equity | 120,502 | 82,968 | ||||||
| Total liabilities and stockholders' equity | $ | 245,950 | $ | 170,731 |
FORTRESS BIOTECH, INC. AND SUBSIDIARIES
Consolidated Statement of Operations
($ in thousands except for share and
| For the Years Ended December 31, | ||||||||||||
| 2017 | 2016 | 2015 | ||||||||||
| Revenue | ||||||||||||
| Fortress | ||||||||||||
| Product revenue, net | $ | 15,520 | $ | 3,587 | $ | 273 | ||||||
| Revenue - from a related party | 1,725 | 2,570 | 590 | |||||||||
| Net Fortress revenue | 17,245 | 6,157 | 863 | |||||||||
| National | ||||||||||||
| Commissions | 96,807 | 5,388 | - | |||||||||
| Net dealer inventory gains | 15,108 | 253 | - | |||||||||
| Investment banking | 25,064 | 2,829 | - | |||||||||
| Investment advisory | 14,528 | 904 | - | |||||||||
| Interest and dividends | 2,764 | 155 | - | |||||||||
| Transfer fees and clearing services | 7,393 | 386 | - | |||||||||
| Tax preparation and accounting | 7,439 | 338 | - | |||||||||
| Other | 1,236 | 70 | - | |||||||||
| Total National revenue | 170,339 | 10,323 | - | |||||||||
| Net revenue | 187,584 | 16,480 | 863 | |||||||||
| Operating expenses | ||||||||||||
| Fortress | ||||||||||||
| Cost of goods sold - product revenue | 3,658 | 790 | - | |||||||||
| Research and development | 48,322 | 29,602 | 18,402 | |||||||||
| Research and development - licenses acquired | 4,164 | 5,532 | 11,408 | |||||||||
| General and administrative | 50,897 | 34,003 | 21,584 | |||||||||
| Total Fortress operating expenses | 107,041 | 69,927 | 51,394 | |||||||||
| National | ||||||||||||
| Commissions, compensation and fees | 155,187 | 10,414 | - | |||||||||
| Clearing fees | 2,343 | 144 | - | |||||||||
| Communications | 2,767 | 177 | - | |||||||||
| Occupancy | 4,286 | 193 | - | |||||||||
| Licenses and registration | 1,726 | 147 | - | |||||||||
| Professional fees | 4,531 | 327 | - | |||||||||
| Interest | 14 | 1 | - | |||||||||
| Depreciation and amortization | 2,089 | 545 | - | |||||||||
| Other administrative expenses | 8,808 | 315 | - | |||||||||
| Total National operating expenses | 181,751 | 12,263 | - | |||||||||
| Total operating expenses | 288,792 | 82,190 | 51,394 | |||||||||
| Loss from operations | (101,208 | ) | (65,710 | ) | (50,531 | ) | ||||||
| Other income (expenses) | ||||||||||||
| Interest income | 819 | 298 | 245 | |||||||||
| Interest expense and financing fee | (5,860 | ) | (3,690 | ) | (1,484 | ) | ||||||
| Change in fair value of derivative liabilities | 8,391 | (1,039 | ) | (438 | ) | |||||||
| Change in fair value of subsidiary convertible note | (457 | ) | (78 | ) | - | |||||||
| Change in fair value of investments | 226 | (1,071 | ) | (1,675 | ) | |||||||
| Other loss | (234 | ) | - | - | ||||||||
| Total other income (expenses) | 2,885 | (5,580 | ) | (3,352 | ) | |||||||
| Loss before income taxes | (98,323 | ) | (71,290 | ) | (53,883 | ) | ||||||
| Income tax expense | 1,513 | - | - | |||||||||
| Net Loss | (99,836 | ) | (71,290 | ) | (53,883 | ) | ||||||
| Less: net loss attributable to non-controlling interests | 32,960 | 16,195 | 5,455 | |||||||||
| Net loss attributable to common stockholders | $ | (66,876 | ) | $ | (55,095 | ) | $ | (48,428 | ) | |||
| Basic and diluted net loss per common share | $ | (1.61 | ) | $ | (1.38 | ) | $ | (1.24 | ) | |||
| Weighted average common shares outstanding-basic and diluted | 41,658,733 | 39,962,657 | 39,146,589 |