Galmed Pharmaceuticals Reports Second Quarter 2016 Financial Results and Provides Business Update

- Conference Call and Webcast Today at 8:30 a.m. EDT / 5:30 a.m. PDT -

Aug 3, 2016

TEL AVIV, Israel, Aug. 3, 2016 /PRNewswire/ -- Galmed Pharmaceuticals Ltd. (Nasdaq: GLMD) ("Galmed" or the "Company"), a clinical-stage biopharmaceutical company focused on the development of a once-daily, oral therapy for the treatment of liver diseases, today reported financial results for the three and six months ended June 30, 2016. The Company will host a conference call and webcast today to discuss the financial results and to provide an update on current developments with respect to its clinical programs for Aramchol.

Financial Summary - Second Quarter 2016 vs. Second Quarter 2015:

  • Net loss of $4.3 million, or $0.39 per share, for the three months ended June 30, 2016, compared to a net loss of $2.4 million, or $0.21 per share, for the three months ended June 30, 2015. This period's net loss included $0.8 million of non-cash, stock-based compensation expense, versus $0.3 million of non-cash stock-based compensation expense incurred during the corresponding period in 2015.
  • Research and development expenses ("R&D") of $3.4 million for the three months ended June 30, 2016, compared to $1.6 million for the three months ended June 30, 2015. The increase resulted primarily from an increase in research and development subcontractor expenses of $1.3 million which was primarily a result of the growth in patient randomization in connection with the ARREST Study, as well an increase of $0.5 million of non-cash stock-based compensation expense.
  • General and administrative expenses of $0.9 million for the three months ended June 30, 2016, compared to $1.0 million for the three months ended June 30, 2015. The decrease in general and administrative expenses for the three months ended June 30, 2016 resulted primarily from our ongoing efforts to reduce non-R&D related expenses.
  • Financial expense of $0.1 million for the three months ended June 30, 2016, compared to financial income of $0.2 million for the three months ended June 30, 2015. The financial expense for the three months ended June 30, 2016 resulted primarily from changes in the foreign currency exchange rate.
  • Cash and cash equivalents and marketable securities totaled $16.7 million as of June 30, 2016, compared to $23.0 million at December 31, 2015. The decrease in cash resulted primarily from the costs of our ongoing clinical studies and operational activities. Galmed expect that its cash balance will be sufficient to maintain its current operations through the second half of 2017.

"Importantly, and as reflected in the significant increase in R&D activities, and associated expenses, we believe that the momentum we are currently experiencing in the ARREST Study continues to support our previously stated guidance regarding patient recruitment," stated Allen Baharaff, Galmed's President and Chief Executive Officer. "As of July 31, 2016, we had randomized 132 patients and have another 27 subjects that are eligible to be randomized. In addition, 41 subjects are currently in the screening process, which normally takes between 6-8 weeks. Based on this we continue to expect to complete the full recruitment of 240 patients by the end of the fourth quarter, 2016."

As previously disclosed on July 28, 2016, we executed a license agreement (the "Agreement") with SAMIL Pharm. Co., Ltd. ("Samil") for an exclusive, royalty-bearing license for the commercialization of Aramchol (with an option to manufacture) for the treatment of fatty liver indications including nonalcoholic steatohepatitis, or NASH, in the Republic of Korea (the "License"). According to the Agreement, Galmed will receive an up-front fee of $2.0 million. Samil has also agreed to pay additional clinical- and regulatory-based milestone payments, which may aggregate up to an additional $6.0 million, as well as tiered, double-digit royalties payable on sales (under certain limitations). The funds provided by this Agreement will provide additional financing for Galmed's development programs. Additionally, following the ARREST Study, Samil has an option to extend the License to Vietnam, which, if exercised, would increase the clinical- and regulatory-based milestone payments.

In addition, we also announced on August 1, 2016 that we had appointed Professor Ran Oren, M.D., as Chief Medical Officer ("CMO"), effective as of August 1, 2016. Dr. Oren currently serves as Professor of Gastroenterology & Hepatology at the Faculty of Medicine, the Hebrew University of Jerusalem, Israel, as well as the Head of the Institute of Gastroenterology and Liver Disease at Hadassah medical center, Jerusalem, Israel ("Hadassah"). Dr. Oren will serve as CMO while maintaining his ongoing commitments at Hebrew University and Hadassah. 

Conference Call & Webcast:
Wednesday, August 3rd, 2016, 8:30 am Eastern Time / 5:30 am Pacific Time
Participant Dial-In Numbers:

Toll-Free:               

+1-888-364-3108

Toll/International:          

+1-719-457-2697

Conference ID:             

3984671

Webcast:                        

http://galmedpharma.investorroom.com/events

 

Replay, available until August 17, 2016


Replay Dial-In Numbers:


Toll-Free:

+1-877-870-5176

Toll/International:

+1-858-384-5517

Passcode:

3984671

About Galmed Pharmaceuticals Ltd.:
Galmed is a clinical-stage biopharmaceutical company focused on the development of a novel, once-daily, oral therapy for the treatment of liver diseases utilizing its proprietary first-in-class family of synthetic fatty-acid/bile-acid conjugates, or FABACs. Galmed believes that its product candidate, Aramchol, has the potential to be a disease modifying treatment for fatty liver disorders, including NASH, which is a chronic disease that Galmed believes constitutes a large unmet medical need. Galmed is currently conducting the ARREST Study, a multicenter, randomized, double blind, placebo-controlled Phase IIb clinical study designed to evaluate the efficacy and safety of Aramchol in subjects with NASH, who are overweight or obese, and who are pre-diabetic or type-II-diabetic. More information about the ARREST Study may be found on ClinicalTrials.gov identifier: NCT02279524.

Forward-Looking Statements:
This press release may include forward-looking statements. Forward-looking statements may include, but are not limited to, statements relating to Galmed's objectives, plans and strategies, as well as statements, other than historical facts, that address activities, events or developments that Galmed intends, expects, projects, believes or anticipates will or may occur in the future.  These statements are often characterized by terminology such as "believes," "hopes," "may," "anticipates," "should," "intends," "plans," "will," "expects," "estimates," "projects," "positioned," "strategy" and similar expressions and are based on assumptions and assessments made in light of management's experience and perception of historical trends, current conditions, expected future developments and other factors believed to be appropriate.  Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statements.  Applicable risks and uncertainties include risks and uncertainties associated with the timing, progress and results of the Company's research, preclinical studies and clinical trials as well as risks and uncertainties identified under the heading "Risk Factors" included in Galmed's most recent Annual Report on Form 20-F filed with the Securities and Exchange Commission, or the SEC, on March 22, 2016, and in other filings that Galmed has made and may make with the SEC in the future.  The forward-looking statements contained in this press release are made as of the date of this press release and reflect Galmed's current views with respect to future events, and Galmed does not undertake and specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

GALMED PHARMACEUTICALS LTD.
Consolidated Balance Sheets

U.S. Dollars in thousands, except share data and per share data










As of

June 30,

2016



As of

December 31,

2015




Unaudited



Audited


Assets









Current assets









Cash and cash equivalents


$

2,946



$

4,156


Marketable securities



13,736




18,845


Other accounts receivable



479




379


Total current assets



17,161




23,380











Property and equipment, net



840




883











Total assets


$

18,001



$

24,263











Liabilities and stockholders' equity


















Current liabilities









Trade payables


$

2,965



$

2,259


Other accounts payable



388




282


Total current liabilities



3,353




2,541











Long-term liabilities









Related parties



222




177


Total long-term liabilities



222




177











Stockholders' equity:









Ordinary shares par value NIS 0.01 per share; Authorized 50,000,000; Issued and outstanding: 11,102,753 shares as of June 30, 2016; 11,100,453 shares as of December 31, 2015



32




32


Additional paid-in capital



70,160




69,086


Accumulated other comprehensive loss



(104)




(206)


Accumulated deficit



(55,662)




(47,367)


Total stockholders' equity



14,426




21,545











Total liabilities and stockholders' equity


$

18,001



$

24,263


 

GALMED PHARMACEUTICALS LTD. 
Consolidated Statements of Operations (Unaudited)

U.S. Dollars in thousands, except share data and per share data










Three months ended

June 30,


Six months ended

June 30,




2016



2015


2016



2015


Research and development expenses


$

3,360



$

1,562


$

6,744



$

2,993


















General and administrative expenses



861




967



1,580




2,040


















Total operating expenses



4,221




2,529



8,324




5,033


















Financial expenses (income), net



89




(175)



(30)




(216)


















Loss before income taxes



4,310




2,354



8,294




4,817


















Taxes on Income



1




-



1




-


















Net loss


$

4,311



$

2,354


$

8,295



$

4,817


















Basic and diluted net loss per share


$

0.39



$

0.21


$

0.75



$

0.43


















Weighted-average number of shares
outstanding used in computing basic
and diluted net loss per share



11,100,853




11,100,453



11,100,655




11,100,453


 

GALMED PHARMACEUTICALS LTD.
Consolidated Statements of Cash Flows (Unaudited)

U.S. Dollars in thousands







Six months ended

June 30,




2016



2015


Cash flow from operating activities


















Net loss


$

(8,295)



$

(4,817)


Adjustments required to reconcile net loss to net cash used in operating activities









Depreciation and amortization



66




13


Stock-based compensation expense



1,063




890


Amortization of discount/premium on marketable securities



35




(27)


Loss from Realization of marketable securities



138




-


Changes in operating assets and liabilities:









Decrease (Increase) in other accounts receivable



43




(220)


Increase (decrease) in trade payables



706




354


Increase in other accounts payable



106




29


Increase (decrease) in related party



45




(206)


Net cash used in operating activities



(6,093)




(3,984)











Cash flow from investing activities









Purchase of property and equipment



(23)




(154)


Maturity of short term deposit



-




6,000


Investment in securities, available for sale



(1,212)




(21,839)


Maturity of securities, available for sale



6,250




3,565


Net cash provided in (used in) investing activities



5,015




(12,428)











Cash flow from financing activities









Issuance of ordinary shares



11




-


Deferred Issuance costs



(143)




-


Net cash used in financing activities



(132)




-











Increase (decrease) in cash and cash equivalents



1,210




(16,412)


Cash and cash equivalents at the beginning of the year



4,156




23,736


Cash and cash equivalents at the end of the period


$

2,946



$

7,324











Supplemental disclosure of cash flow information:









Cash received from interest


$

223




245


 

GALMED PHARMACEUTICALS LTD.
Notes to Consolidated Statements of Operations (unaudited)

U.S. Dollars in thousands





Research and Development Expenses:








Three months ended June 30,




2016



2015




(in thousands)


Chemistry and formulation studies

$

210


$

325


Salaries and benefits  


240



203


Stock-based compensation  


523



35


Research and preclinical studies  


162



144


Clinical studies  


2,043



783


Regulatory and other expenses  


183



72



$

3,360


$

1,562








General and Administrative Expenses:








Three months ended June 30,




2016



2015




(in thousands)


Stock-based compensation  

$

267


$

296


Professional fees  


225



222


Salaries and benefits  


212



188


Rent and office-maintenance fees  


71



110


Investor relations and business      


83



148


Development  


3



3


Other  

$

861


$

967

 

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SOURCE Galmed Pharmaceuticals Ltd.

For further information: Investor Contact: Josh Blacher, CFO, Galmed Pharmaceuticals Ltd., josh@galmedpharma.com, +1-646-780-7605


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