Full Press Release Details
FENNEC PHARMACEUTICALS REPORTS FULL YEAR AND
FOURTH QUARTER 2023 FINANCIAL RESULTS AND PROVIDES BUSINESS UPDATE
~ Achieved PEDMARK Full-Year
2023 Net Product Sales of $21.3 Million, Including $9.7 Million in Net Product Sales in the Fourth Quarter of 2023 ~
Entered Into Exclusive Licensing Agreement to Commercialize PEDMARQSI in Europe, Australia and New Zealand for Approximately
$43 Million Upfront and Up to Approximately $230 Million in Additional Commercial and Regulatory Milestones, and Tiered Royalties Up to
~ Pro forma fourth quarter cash in excess of
~ Management to Host Conference Call Today at 8:30
Triangle Park, NC, March 21, 2024 - Fennec Pharmaceuticals Inc. (NASDAQ:FENC; TSX: FRX), a specialty
pharmaceutical company, today reported its financial results for the fiscal year ended December 31, 2023 and provided a business
an exciting year for Fennec given the strong performance with PEDMARK in the first full fiscal year following its U.S.
commercial launch. We are pleased with our execution against strategic plans and our momentum in 2023, which sets the stage for further
success in 2024 and beyond. We also received European Commission and U.K. approvals of PEDMARQSI , which led to the recent announcement
of an exclusive licensing agreement with Norgine for Europe, Australia and New Zealand," said Rosty Raykov, Chief Executive
Officer of Fennec Pharmaceuticals. "We have significantly strengthened our balance sheet through
the agreement with Norgine, and we remain dedicated to further growing our revenues as we expand the availability of PEDMARK
to patients and providers globally."
Recent Developments and Highlights:
Financial Results for the Fourth Quarter
and Fiscal Year Ended December 31, 2023
The selected financial data presented below is
derived from our unaudited, condensed consolidated financial statements, which were prepared in accordance with U.S. generally accepted
accounting principles. The complete audited, condensed consolidated financial statements for the period ended December 31, 2023,
and management's discussion and analysis of financial condition and results of operations, will be available via www.sec.gov and www.sedar.com.
All values are presented in thousands unless otherwise noted.
Audited Consolidated
Statements of Operations:
(U.S. Dollars in thousands except per share amounts)
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Revenue | ||||||||||||||||
| PEDMARK product sales, net | $ | 9,735 | $ | 1,535 | $ | 21,252 | $ | 1,535 | ||||||||
| Cost of products sold | (685 | ) | (86 | ) | (1,259 | ) | (86 | ) | ||||||||
| Gross profit | 9,050 | 1,449 | 19,993 | 1,449 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 32 | 117 | 56 | 3,531 | ||||||||||||
| Selling and marketing | 3,868 | 2,785 | 12,123 | 2,785 | ||||||||||||
| General and administrative | 6,968 | 4,682 | 20,585 | 17,722 | ||||||||||||
| Total operating expenses | 10,868 | 7,584 | 32,764 | 24,038 | ||||||||||||
| Loss from operations | (1,818 | ) | (6,135 | ) | (12,771 | ) | (22,589 | ) | ||||||||
| Other (expense)/income | ||||||||||||||||
| Unrealized foreign exchange gain (loss) | 2 | (58 | ) | 5 | (9 | ) | ||||||||||
| Amortization expense | (70 | ) | (70 | ) | (287 | ) | (149 | ) | ||||||||
| Unrealized gain (loss) on securities | 4 | (3 | ) | (39 | ) | (184 | ) | |||||||||
| Interest income | 115 | 153 | 441 | 195 | ||||||||||||
| Interest expense | (915 | ) | (744 | ) | (3,394 | ) | (978 | ) | ||||||||
| Total other (expense)/income | (864 | ) | (722 | ) | (3,274 | ) | (1,125 | ) | ||||||||
| Net loss | $ | (2,682 | ) | $ | (6,857 | ) | $ | (16,045 | ) | $ | (23,714 | ) | ||||
| Basic net loss per common share | $ | (0.10 | ) | $ | (0.26 | ) | $ | (0.60 | ) | $ | (0.90 | ) | ||||
| Diluted net loss per common share | $ | (0.10 | ) | $ | (0.26 | ) | $ | (0.60 | ) | $ | (0.90 | ) | ||||
| Weighted-average number of common shares outstanding, basic | 26,833 | 26,275 | 26,574 | 26,275 | ||||||||||||
| Weighted-average number of common shares outstanding, diluted | 26,833 | 26,275 | 26,574 | 26,275 |
Audited Consolidated Balance Sheets:
(U.S. Dollars in thousands)
| December 31, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 13,269 | $ | 23,774 | ||||
| Accounts receivable, net | 8,814 | 1,545 | ||||||
| Prepaid expenses | 583 | 770 | ||||||
| Inventory | 2,156 | 576 | ||||||
| Other current assets | 21 | 63 | ||||||
| Total current assets | 24,843 | 26,728 | ||||||
| Non-current assets | ||||||||
| Deferred issuance cost, net amortization | 2,021 | 211 | ||||||
| Total non-current assets | 2,021 | 211 | ||||||
| Total assets | $ | 26,864 | $ | 26,939 | ||||
| Liabilities and shareholders' (deficit) equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 3,799 | $ | 2,390 | ||||
| Accrued liabilities | 3,754 | 2,219 | ||||||
| Total current liabilities | 7,553 | 4,609 | ||||||
| Long term liabilities | ||||||||
| Term loan | 30,000 | 25,000 | ||||||
| PIK interest | 1,219 | 260 | ||||||
| Debt discount | (286 | ) | (361 | ) | ||||
| Total long term liabilities | 30,933 | 24,899 | ||||||
| Total liabilities | 38,486 | 29,508 | ||||||
| Commitments and Contingencies | ||||||||
| Shareholders'(deficit) equity: | ||||||||
| Common stock, no par value; unlimited shares authorized; 26,361 shares issued and outstanding (2022 -26,014) | 144,307 | 142,591 | ||||||
| Additional paid-in capital | 60,073 | 56,797 | ||||||
| Accumulated deficit | (219,245 | ) | (203,200 | ) | ||||
| Accumulated other comprehensive income | 1,243 | 1,243 | ||||||
| Total shareholders' (deficit) equity | (11,622 | ) | (2,569 | ) | ||||
| Total liabilities and shareholders' (deficit) equity | $ | 26,864 | $ | 26,939 |
| Fiscal Year Ended | ||||||||
| Working capital Selected Asset and Liability Data: | December 31, 2023 | December 31, 2022 | ||||||
| (U.S. Dollars in thousands) | ||||||||
| Cash and equivalents | $ | 13,269 | $ | 23,774 | ||||
| Other current assets | 11,574 | 2,954 | ||||||
| Current liabilities | (7,553 | ) | (4,608 | ) | ||||
| Working capital | $ | 17,290 | $ | 22,120 | ||||
| Selected Equity: | ||||||||
| Common stock and additional paid in capital | 206,380 | 199,388 | ||||||
| Accumulated deficit | (219,245 | ) | (203,200 | ) | ||||
| Shareholders' equity | (11,622 | ) | (2,569 | ) |
Cisplatin-Induced Ototoxicity
and other platinum compounds are essential chemotherapeutic agents for the treatment of many pediatric malignancies. Unfortunately, platinum-based
therapies can cause ototoxicity, or hearing loss, which is permanent, irreversible, and particularly harmful to the survivors of pediatric
of ototoxicity depends upon the dose and duration of chemotherapy, and many of these children require lifelong hearing aids or cochlear
implants, which can be helpful for some, but do not reverse the hearing loss and can be costly over time.ii Infants and young
children that are affected by ototoxicity at critical stages of development lack speech and language development and literacy, and older
children and adolescents often lack social-emotional development and educational achievement.iii
PEDMARK (sodium thiosulfate
is the first and only U.S. Food and Drug Administration (FDA) approved therapy indicated to reduce the risk of ototoxicity associated
with cisplatin treatment in pediatric patients with localized, non-metastatic, solid tumors. It is a unique formulation of sodium thiosulfate
in single-dose, ready-to-use vials for intravenous use in pediatric patients.7 PEDMARK is also the only therapeutic agent with
proven efficacy and safety data with an established dosing paradigm, across two open-label, randomized Phase 3 clinical studies, the Clinical
Oncology Group (COG) Protocol ACCL0431 and SIOPEL 6.
and Europe, it is estimated that, annually, more than 10,000 children may receive platinum-based chemotherapy. The incidence of ototoxicity
depends upon the dose and duration of chemotherapy, and many of these children require lifelong hearing aids. There is currently no established
preventive agent for this hearing loss and only expensive, technically difficult, and sub-optimal cochlear (inner ear) implants have been
shown to provide some benefit. Infants and young children that suffer ototoxicity at critical stages of development lack speech language
development and literacy, and older children and adolescents lack social-emotional development and educational achievement.
has been studied by co-operative groups in two Phase 3 clinical studies of survival and reduction of ototoxicity, COG ACCL0431 and SIOPEL
6. Both studies have been completed. The COG ACCL0431 protocol enrolled childhood cancers typically treated with intensive cisplatin therapy
for localized and disseminated disease, including newly diagnosed hepatoblastoma, germ cell tumor, osteosarcoma, neuroblastoma, medulloblastoma,
and other solid tumors. SIOPEL 6 enrolled only hepatoblastoma patients with localized tumors.
(sodium thiosulfate injection) is indicated to reduce the risk of ototoxicity associated with cisplatin in pediatric patients 1 month
of age and older with localized, non-metastatic solid tumors.
The safety and efficacy of PEDMARK have not been
established when administered following cisplatin infusions longer than 6 hours. PEDMARK may not reduce the risk of ototoxicity when administered
following longer cisplatin infusions, because irreversible ototoxicity may have already occurred.
Important Safety Information
PEDMARK is contraindicated in patients with history
of a severe hypersensitivity to sodium thiosulfate or any of its components.
Hypersensitivity reactions occurred in 8% to 13%
of patients in clinical trials. Monitor patients for hypersensitivity reactions. Immediately discontinue PEDMARK and institute appropriate
care if a hypersensitivity reaction occurs. Administer antihistamines or glucocorticoids (if appropriate) before each subsequent administration
of PEDMARK. PEDMARK may contain sodium sulfite; patients with sulfite sensitivity may have hypersensitivity reactions, including anaphylactic
symptoms and life-threatening or severe asthma episodes. Sulfite sensitivity is seen more frequently in people with asthma.
PEDMARK is not indicated for use in pediatric
patients less than 1 month of age due to the increased risk of hypernatremia or in pediatric patients with metastatic cancers.
Hypernatremia occurred in 12% to 26% of patients
in clinical trials, including a single Grade 3 case. Hypokalemia occurred in 15% to 27% of patients in clinical trials, with Grade 3 or
4 occurring in 9% to 27% of patients. Monitor serum sodium and potassium levels at baseline and as clinically indicated. Withhold PEDMARK
in patients with baseline serum sodium greater than 145 mmol/L.
Monitor for signs and symptoms of hypernatremia
and hypokalemia more closely if the glomerular filtration rate (GFR) falls below 60 mL/min/1.73m2.
Administer antiemetics prior to each PEDMARK administration.
Provide additional antiemetics and supportive care as appropriate.
The most common adverse reactions ( 25% with
difference between arms of >5% compared to cisplatin alone) in SIOPEL 6 were vomiting, nausea, decreased hemoglobin, and hypernatremia.
The most common adverse reaction ( 25% with difference between arms of >5% compared to cisplatin alone) in COG ACCL0431 was hypokalemia.
see full Prescribing Information for PEDMARK at: www.PEDMARK.com.
Pharmaceuticals Inc. is a specialty pharmaceutical company focused on the development and commercialization of PEDMARK
to reduce the risk of platinum-induced ototoxicity in pediatric patients. Further, PEDMARK received FDA approval in September 2022
and has received Orphan Drug Exclusivity in the U.S. Fennec has a license agreement with Oregon Health and Science University (OHSU) for
exclusive worldwide license rights to intellectual property directed to sodium thiosulfate and its use for chemoprotection, including
the reduction of risk of ototoxicity induced by platinum chemotherapy, in humans. For more information, please visit www.fennecpharma.com.
Forward Looking Statements
Except for historical information described
in this press release, all other statements are forward-looking. Words such as "believe," "anticipate," "plan,"
"expect," "estimate," "intend," "may," "will," or the negative of those terms,
and similar expressions, are intended to identify forward-looking statements. These forward-looking statements include statements about
our business strategy, timeline and other goals, plans and prospects, including our commercialization plans respecting PEDMARK ,
the market opportunity for and market impact of PEDMARK , its potential impact on patients and anticipated benefits associated
with its use, and potential access to further funding after the date of this release. Forward-looking statements are subject to certain
risks and uncertainties inherent in the Company's business that could cause actual results to vary, including the risks and uncertainties
that regulatory and guideline developments may change, scientific data and/or manufacturing capabilities may not be sufficient to meet
regulatory standards or receipt of required regulatory clearances or approvals, clinical results may not be replicated in actual patient
settings, unforeseen global instability, including political instability, or instability from an outbreak of pandemic or contagious disease,
such as the novel coronavirus (COVID-19), or surrounding the duration and severity of an outbreak, protection offered by the Company's