Cardiome Reports Third Quarter 2016 Financial Results

Cardiome to conduct conference call and webcast on Monday, 
November 7, 2016 at 4:00pm Eastern (1:00pm Pacific)

NASDAQ: CRME TSX: COM

Quarterly Highlights:

  • Q3 revenue consistent with both quarterly and annual targets.
  • Completed an underwritten equity offering whereby Cardiome issued 11.5 million shares from treasury for gross proceeds of US$34.5 million.
  • Prepared our commercial markets for the imminent launch of XYDALBA™.
  • Initiated commercial operations in Canada by putting an acute-care hospital focused sales force in place.
  • Announced that the European Medicines Agency had approved the administration option of three 500mg vials of XYDALBA™ as a single infusion.
  • Announced that many insiders had purchased Cardiome's common shares on the open market.

VANCOUVER, Nov. 7, 2016 /CNW/ - Cardiome Pharma Corp. (NASDAQ: CRME / TSX: COM) today reported financial results for its third quarter ended September 30, 2016. Amounts, unless specified otherwise, are expressed in U.S. dollars and in accordance with generally accepted accounting principles used in the United States of America (U.S. GAAP).

Commenting on Cardiome's third quarter results, Dr. William Hunter, CEO, said "Cardiome's commercial business performed as expected in Q3, which is our seasonally weakest quarter, and we remain on track to meet our expectations for 2016 revenues in the mid $20M's. However, we are most excited about being just a few weeks away from launching XYDALBA in Europe. We have been busy investing in our capabilities such as increasing the size of our sales force, adding infectious disease and market access specialists, all the while, preparing our markets for its imminent launch.  We have been very pleased with the reception that this exciting drug has received. We think that XYDALBA will provide strong revenue momentum starting in 2017 and beyond."

Summary Results

Cardiome recorded a net loss of $5.4 million (basic loss per share of $0.19) for the three months ended September 30, 2016 compared to a net loss of $5.8 million (basic loss per share of $0.31) for the three months ended September 30, 2015. On a year-to-date basis, Cardiome recorded a net loss of $14.1 million (basic loss per share of $0.61) for the nine months ended September 30, 2016 compared to a net loss of $17.1 million (basic loss per share of $0.97) for the nine months ended September 30, 2015. The decrease in net loss on a year-to-date basis was due primarily to an increase in revenue and a decrease in research and development ("R&D") expense as Cardiome made an upfront payment of $3.0 million to SteadyMed Therapeutics ("SteadyMed") upon the execution of a license and supply agreement for TREVYENT® in 2015.

Revenue for the three months ended September 30, 2016 was $5.2 million compared to revenue of $5.0 million for the three months ended September 30, 2015. Revenue for the nine months ended September 30, 2016 and 2015 was $18.2 million and $16.2 million, respectively. The increase in revenue for the nine months ended September 30, 2016 was due to the timing of distributor sales.

Gross margin for the three and nine months ended September 30, 2016 were 74.4% and 75.6% respectively, compared to 71.9% and 76.7% for the three and nine months ended September 30, 2015. The fluctuation in gross margin is primarily due to changes in customer mix.

Selling, general and administration ("SG&A") expense for the three months ended September 30, 2016 was $7.2 million compared to $8.0 million for the three months ended September 30, 2015. The decrease in SG&A expense for the three months ended September 30, 2016 was due to one-time $0.8 million charge related to the termination of a distributor agreement incurred during the three months ended September 30, 2015.  On a year-to-date basis, SG&A expense for the nine months ended September 30, 2016 was $21.4 million compared to $22.7 million for the nine months ended September 30, 2015.  The decrease in SG&A expense is primarily related to a one-time $0.8 million charge related to the termination of a distributor agreement in 2015 and a decrease in Cardiome's stock-based compensation expense as a result of market fluctuations in Cardiome's share price.

R&D expense for the three- month periods ended September 30, 2016 and 2015 was insignificant.  R&D expense for the nine months ended September 30, 2016 was nil compared to $3.2 million for the nine months ended September 30, 2015 reflecting the $3.0 million upfront payment Cardiome made to SteadyMed upon the execution of a license and supply agreement for TREVYENT®.

Interest expense was $0.9 million for the three months ended September 30, 2016, compared to $0.5 million for the three months ended September 30, 2015. The increase was due to an increase in long-term debt from a term loan agreement that Cardiome entered into during the second quarter of 2016.  On a year-to-date basis, interest expense was $1.7 million for the nine months ended September 30, 2016 compared to $1.8 million for the nine months ended September 30, 2015. The decrease was due to the higher amortization of debt issuance costs during the nine months ended September 30, 2015, offset by the increase in long-term debt in the second quarter of 2016.

During the nine months ended September 30, 2016, Cardiome had a loss on extinguishment of long-term debt of $1.4 million compared to nil for the nine months ended September 30, 2015. In the second quarter of 2016, Cardiome extinguished its senior secured term loan facility with Midcap Financial LLC.

Liquidity and Outstanding Share Capital

At September 30, 2016, Cardiome had cash and cash equivalents of $31.5 million. As of November 4, 2016, there were 31,876,647 common shares issued and outstanding, and 2,012,557 common shares issuable upon the exercise of outstanding stock options (of which 1,239,847 were exercisable) at a weighted average exercise price of CAD $5.80 per share, and 134,594 restricted share units outstanding.

Conference Call
Cardiome will hold a teleconference and webcast on November 7, 2016 at 4:00pm Eastern (1:00pm Pacific). To access the conference call, please dial 416-764-8688 or 888-390-0546 and use conference ID 18697541. The webcast can be accessed through Cardiome's website at www.cardiome.com or through the following link:

http://event.on24.com/r.htm?e=1288274&s=1&k=E8DD5BE99805E25D75325B53EC401D83

Webcast and telephone replays of the conference call will be available approximately two hours after the completion of the call through December 7, 2016. Please dial 416-764-8677 or 888-390-0541 and enter code 697541 # to access the replay.

About Cardiome Pharma Corp.
Cardiome Pharma Corp. is a specialty pharmaceutical company dedicated to the development and commercialization of innovative therapies that will improve the quality of life and health of patients suffering from disease. Cardiome has two marketed, in-hospital, cardiology products, BRINAVESS® (vernakalant IV), approved in Europe and other territories for the rapid conversion of recent onset atrial fibrillation to sinus rhythm in adults, and AGGRASTAT® (tirofiban HCl) a reversible GP IIb/IIIa inhibitor indicated for use in patients with acute coronary syndrome. Cardiome also commercializes ESMOCARD® and ESMOCARD LYO® (esmolol hydrochloride), a short-acting beta-blocker used to control rapid heart rate in a number of cardiovascular indications, on behalf of their partner AOP Orphan Pharma in select European markets. Cardiome has also licensed: XYDALBA™ (dalbavancin hydrochloride), a second generation, semi-synthetic lipoglycopeptide approved in the EU for the treatment of acute bacterial skin and skin structure infections in adults for select European and Middle Eastern nations and Canada from Allergan; and TREVYENT®, a development stage drug device combination that is under development for Pulmonary Arterial Hypertension for Europe, the Middle East and for Canadian markets from SteadyMed Therapeutics.

Cardiome is traded on the NASDAQ Capital Market (CRME) and the Toronto Stock Exchange (COM). For more information, please visit our web site at www.cardiome.com.

Forward-Looking Statement Disclaimer
Certain statements in this news release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 or forward-looking information under applicable Canadian securities legislation that may not be based on historical fact, including without limitation statements containing the words "believe", "may", "plan", "will", "estimate", "continue", "anticipate", "intend", "expect" and similar expressions. Forward- looking statements may involve, but are not limited to, comments with respect to our objectives and priorities for 2016 and beyond, our strategies or future actions, our targets, expectations for our financial condition and the results of, or outlook for, our operations, research and development and product and drug development. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Many such known risks, uncertainties and other factors are taken into account as part of our assumptions underlying these forward-looking statements and include, among others, the following: general economic and business conditions in the United States, Canada, Europe, and the other regions in which we operate; market demand; technological changes that could impact our existing products or our ability to develop and commercialize future products; competition; existing governmental legislation and regulations and changes in, or the failure to comply with, governmental legislation and regulations; availability of financial reimbursement coverage from governmental and third-party payers for products and related treatments; adverse results or unexpected delays in pre-clinical and clinical product development processes; adverse findings related to the safety and/or efficacy of our products or products; decisions, and the timing of decisions, made by health regulatory agencies regarding approval of our technology and products; the requirement for substantial funding to expand commercialization activities; and any other factors that may affect our performance. In addition, our business is subject to certain operating risks that may cause any results expressed or implied by the forward-looking statements in this presentation to differ materially from our actual results. These operating risks include: our ability to attract and retain qualified personnel; our ability to successfully complete pre-clinical and clinical development of our products; changes in our business strategy or development plans; intellectual property matters, including the unenforceability or loss of patent protection resulting from third-party challenges to our patents; market acceptance of our technology and products; our ability to successfully manufacture, market and sell our products; the availability of capital to finance our activities; and any other factors described in detail in our filings with the Securities and Exchange Commission ("SEC") available at www.sec.gov and the Canadian securities regulatory authorities at www.sedar.com. Given these risks, uncertainties and factors, you are cautioned not to place undue reliance on such forward-looking statements and information, which are qualified in their entirety by this cautionary statement. All forward-looking statements and information made herein are based on our current expectations and we undertake no obligation to revise or update such forward-looking statements and information to reflect subsequent events or circumstances, except as required by law.

CARDIOME PHARMA CORP.
Interim Consolidated Balance Sheets
(Unaudited)
(Expressed in thousands of U.S. dollars, except share amounts)











September 30,
2016

December 31,
2015




Assets

 



Current assets:




Cash and cash equivalents

$

31,534

$

17,661


Restricted cash

2,637

2,196


Accounts receivable, net of allowance for doubtful accounts of
$107 (2015 - $424)

 

5,047

 

6,814


Inventories

4,518

4,401


Prepaid expenses and other assets

1,667

1,408


Deferred income tax assets

381

469


45,784

32,949




Property and equipment

604

740

Intangible assets

25,863

14,221

Goodwill

318

318


$

72,569

$

48,228




Liabilities and Stockholders' Equity

 



Current liabilities:




Accounts payable and accrued liabilities

$

6,832

$

10,488


Current portion of long-term debt, net of unamortized debt
issuance costs

-

3,912


Current portion of deferred consideration

2,834

2,619


Current portion of deferred revenue

193

188


9,859

17,207




Long-term debt, net of unamortized debt issuance costs

19,343

5,686

Deferred consideration

508

2,478

Deferred revenue

2,570

2,647

Other long-term liabilities

248

274


32,528

28,292




Stockholders' equity:




Common stock

344,747

312,019



Authorized - unlimited number with no par value





Issued and outstanding – 31,876,647 (2015 – 20,147,337)




Additional paid-in capital

35,572

34,678


Deficit

(357,467)

(343,435)


Accumulated other comprehensive income

17,189

16,674


40,041

19,936


$

72,569

$

48,228

 

CARDIOME PHARMA CORP.
Interim Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(Expressed in thousands of U.S. dollars, except share and per share amounts)











Three months ended

Nine months ended


September 30,
2016

September 30,
2015

September 30,
2016

September 30,
2015

Revenue:






Product and royalty revenues

$

5,186

$

4,933

$

18,093

$

16,118


Licensing and other fees

51

25

145

75


5,237

4,958

18,238

16,193

Cost of goods sold

1,342

1,393

4,452

3,771

Gross margin

3,895

3,565

13,786

12,422

Expenses:






Selling, general and administration

7,170

8,028

21,415

22,736


Research and development

-

15

-

3,161


Amortization

853

546

2,131

1,631


8,023

8,589

23,546

27,528

Operating loss

(4,128)

(5,024)

(9,760)

(15,106)






Other (income) expense:






Loss on extinguishment of long-term debt

-

-

1,402

-


Interest expense

865

542

1,715

1,776


Other (income) expense

(6)

38

329

125


Foreign exchange (gain) loss

209

37

601

(298)


1,068

617

4,047

1,603

Loss before income taxes

(5,196)

(5,641)

(13,807)

(16,709)

Income tax expense

88

169

225

349

Net loss

$

(5,284)

$

(5,810)

$

(14,032)

$

(17,058)

Other comprehensive income (loss):






Foreign currency translation adjustments

149

41

515

(631)

Comprehensive loss

$

(5,135)

$

(5,769)

$

(13,517)

$

(17,689)

Loss per common share






Basic

$

(0.19)

$

(0.31)

$

(0.61)

$

(0.97)


Diluted

$

(0.19)

$

(0.31)

$

(0.62)

$

(0.97)

Weighted average common shares outstanding






Basic

28,376,143

18,774,416

23,034,503

17,542,994


Diluted

28,433,016

18,939,593

23,101,263

17,542,994

 

CARDIOME PHARMA CORP.
Interim Consolidated Statements of Cash Flows
(Unaudited)
(Expressed in thousands of U.S. dollars)











Three months ended

Nine months ended


September 30, 
2016

September 30,
2015

September 30,
2016

September 30,
2015

Operating activities:





Net loss for the period                                             

$

(5,284)

$

(5,810)

$

(14,032)

$

(17,058)

Items not affecting cash:






Amortization

853

546

2,131

1,631


Amortization of deferred financing fees

56

143

202

408


Write-down of inventory

-

49

-

144


Loss on extinguishment of long-term debt

-

-

1,402

-


Stock-based compensation expense (recovery)

209

396

(84)

1,991


Unrealized foreign exchange gain (loss)

122

(46)

475

(255)

Changes in operating assets and liabilities:






Restricted cash

-

254

(295)

(65)


Accounts receivable

2,435

1,644

1,923

3,971


Inventories

(87)

304

(116)

112


Prepaid expenses and other assets

180

(238)

(323)

(264)


Accounts payable and accrued liabilities

(2,905)

(770)

(2,577)

(2,806)


Deferred revenue

21

475

(73)

1,425


Other long-term liabilities

(8)

(8)

(23)

(50)

Net cash used in operating activities

(4,408)

(3,061)

(11,390)

(10,816)






Investing activities:






Purchase of property and equipment

-

-

(9)

(133)


Purchase of intangible assets

(8,017)

(5)

(13,628)

(29)

Net cash used in investing activities

(8,017)

(5)

(13,637)

(162)






Financing activities:






Issuance of common stock

34,500

23,324

35,341

28,124


Share issue costs

(2,722)

(1,473)

(2,752)

(1,524)


Issuance of common stock upon exercise of stock options

-

-

-

270


Proceeds from issuance of long-term debt

-

-

20,000

-


Financing fees on issuance of long-term debt

(23)

-

(713)

-


Repayment of long-term debt

-

(1,000)

(10,000)

(1,000)


Payment of fees on extinguishment of long-term debt

-

-

(1,146)

-


Payment of deferred consideration

(726)

(669)

(1,755)

(2,537)

Net cash provided by financing activities

31,029

20,182

38,975

23,333






Increase in cash and cash equivalents during the period

18,604

17,116

13,948

12,355

Effect of foreign exchange rate changes on cash and cash equivalents

46

15

(75)

(316)

Cash and cash equivalents, beginning of period

12,884

7,616

17,661

12,708

Cash and cash equivalents, end of period

$

31,534

$

24,747

$

31,534

$

24,747






Supplemental cash flow information:





Interest paid

$

815

$

411

$

1,524

$

1,450

Net income taxes paid

46

291

31

628

 

SOURCE Cardiome Pharma Corp.

For further information: David Dean, Cardiome Investor Relations, (604) 677-6905 ext. 311 or Toll Free: 1-800-330-9928, Email: ddean@cardiome.com

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