NEW YORK, Nov. 09, 2016 (GLOBE NEWSWIRE) -- 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 September 30, 2016. Dr. Lindsay A. Rosenwald, Chairman, President and CEO of Fortress, said, "We recently launched our seventh Fortress Company, Cellvation, based on compelling science from The University of Texas Health Science Center at Houston in traumatic brain injury, an area of great unmet need, including two Phase 2 cell therapy programs. In addition, the clinical oncology pipeline of our Fortress Companies continues to grow, with the initiation of Checkpoint's Phase 1/2 study of its EGFR inhibitor CK-101. In September, Fortress, through its subsidiary FBIO Acquisition, Inc., closed its tender offer for shares of National Holdings Corporation. We believe that as Fortress and National leverage their synergies, growth opportunities will be created for both companies." Financial Results:
- As of September 30, 2016, Fortress' consolidated cash and cash equivalents totaled $82.5 million, compared to $71.3 million as of June 30, 2016, and $98.2 million as of December 31, 2015, an increase of $11.2 million for the third quarter and a decrease of $15.7 million year-to-date. These totals exclude restricted cash of $15.9 million as of September 30, 2016.
- Total revenue for the third quarter of 2016 was $1.0 million, consisting of $0.43 million of net product revenue from Journey Medical Corporation ("JMC"), a Fortress Company, and $0.55 million of collaboration revenue from a related party, compared to $0.03 million in total revenue reported during the third quarter of 2015. Total revenue for the first nine months of 2016 was $3.9 million, consisting of $1.8 million in net product sales from JMC and $2.1 million in collaboration revenue from a related party, compared to $0.5 million in collaboration revenue from a related party reported for the first nine months of 2015.
- Research and development expenses were $7.3 million for the third quarter of 2016, of which $5.5 million was related to Fortress Companies, and $21.4 million for the first nine months of 2016, of which $15.8 million was related to Fortress Companies. This compares to $9.1 million for the third quarter of 2015, of which $4.9 million was related to Fortress Companies, and $13.2 million for the first nine months of 2015, of which $3.8 million was related to Fortress Companies. Noncash stock-based compensation expense included in research and development for the third quarter of 2016 was $0.9 million, compared to $4.3 million for the third quarter of 2015, and $3.4 million for the first nine months of 2016, compared to $5.2 million for the first nine months of 2015.
- Research and development expenses from licenses acquired were $1.0 million for the third quarter of 2016 and $3.1 million for the first nine months of 2016, compared to $1.9 million for the third quarter of 2015 and $10.9 million for the first nine months of 2015.
- General and administrative expenses were $8.9 million for the third quarter of 2016, of which $3.8 million was related to Fortress Companies, and $25.4 million for the first nine months of 2016, of which $11.5 million was related to Fortress Companies, compared to $7.1 million for the third quarter of 2015, of which $1.7 million was related to Fortress Companies, and $14.4 million for the first nine months of 2015, of which $3.3 million was related to Fortress Companies. Noncash stock-based compensation expense included in general and administrative expenses was $2.0 million for the third quarter of 2016 and $5.4 million for the first nine months of 2016, compared to $4.2 million for the third quarter of 2015 and $6.7 million for the first nine months of 2015.
- Net loss was $13.0 million, or $0.32 per share, for the third quarter of 2016, compared to a net loss of $18.2 million, or $0.46 per share, for the third quarter of 2015. For the first nine months of 2016, net loss was $37.7 million, or $0.94 per share, compared to $36.4 million, or $0.93 per share, for the first nine months of 2015.
- In September 2016, Fortress, through its subsidiary FBIO Acquisition, Inc., purchased approximately 56% of National Holdings Corporation (NASDAQ:NHLD) common stock, par value $0.02 per share, at a purchase price of $3.25 per share in cash, for an aggregate purchase price of approximately $22.9 million.
- In October 2016, Cellvation entered into an agreement with The University of Texas Health Science Center at Houston to secure exclusive worldwide rights to three programs for TBI, including two Phase 2 cell therapies and a next-generation bioreactor that enhances the anti-inflammatory potency of bone marrow-derived cells without genetic manipulation.
- In August 2016, the U.S. Food and Drug Administration ("FDA") accepted an Investigational New Drug Application ("IND") for a Phase 1/2 clinical trial of Checkpoint's epidermal growth-factor receptor inhibitor ("EGFR") CK-101, and in September 2016, the first patient was dosed. The Phase 1 dose escalation portion of the study will evaluate the safety and tolerability of ascending doses of CK-101 in patients with advanced solid tumors to determine the maximum tolerated dose and/or recommended Phase 2 dose of CK-101. The Phase 2 portion of the study is planned to evaluate the safety and efficacy of the recommended Phase 2 dose of CK-101 in patients with EGFR T790M mutation-positive non-small cell lung cancer.
- On June 30, September 30 and October 31, 2016, Helocyte closed on additional sales of convertible promissory notes raising an aggregate of approximately $4.0 million to date.
- In October 2016, Helocyte announced the online publication of data in Blood from the Phase 1 trial of Triplex vaccine for control of cytomegalovirus (CMV) in allogeneic hematopoietic stem cell transplant (HSCT) and solid organ transplant (SOT) recipients. In the Phase 1 study, Triplex was found to be safe, well-tolerated and highly immunogenic when administered to healthy volunteers at multiple dose levels. These data supported the initiation of an ongoing Phase 2 trial evaluating Triplex in patients undergoing allogeneic HSCT.
- In July 2016, JMC received FDA approval to manufacture Targadox™ for the treatment of severe acne. Sales commenced in October 2016.
- Also in July 2016, JMC products Luxamend Ò Wound Cream and Ceracade™ Skin Emulsion were showcased at the 2016 American Academy of Dermatology (AAD) Summer Meeting in Boston.
- On September 30 and October 25, 2016, Mustang Bio closed on private placements of Units, comprised of shares of its common stock and warrants, raising an aggregate of approximately $19.5 million, less offering expenses. Units were sold at $65,000 each. National Securities Corporation acted as sole placement agent in the private placements.
|FORTRESS BIOTECH, INC. AND SUBSIDIARIES|
|Condensed Consolidated Balance Sheets|
|($ in thousands except for share and per share amounts)|
|September 30,||December 31,|
|Cash and cash equivalents||$||82,537||$||98,182|
|Cash deposits with clearing organizations||1,030||-|
|Receivables from broker-dealers and clearing organizations||1,607||-|
|Securities owned, at fair value||2,178||-|
|Other receivables - related party||1,545||156|
|Prepaid expenses and other current assets||4,556||1,599|
|Total current assets||98,583||99,937|
|Property and equipment, net||6,957||309|
|Long-term investments, at fair value||685||2,485|
|Intangible assets, net||1,550||1,250|
|LIABILITIES AND STOCKHOLDERS' EQUITY|
|Accounts payable and accrued expenses||$||21,831||$||10,438|
|Accrued commissions and payroll payable||14,029||-|
|Deferred clearing and marketing credits||1,007||-|
|Derivative warrant liability||951||114|
|Other current liabilities||707||-|
|Total current liabilities||38,593||10,579|
|Notes payable, long-term (net of debt discount of $2,764 and $835 at September 30, 2016 and December 31,2015, respectively)||24,373||23,174|
|Subsidiary convertible note, at fair value||3,031||-|
|Other long-term liabilities||4,583||584|
|Commitments and contingencies|
|Convertible Preferred stock, $.001 par value, 129,767 Series C shares authorized, 0 shares issued andoutstanding as of September 30, 2016 and December 31, 2015, respectively||-||-|
|Common Stock, $.001 par value, 100,000,000 shares authorized, 48,875,087 and 47,147,032 shares issued andoutstanding as of September 30, 2016 and December 31, 2015, respectively||49||47|
|Total stockholders' equity attributed to the Company||36,626||56,846|
|Total stockholders' equity||74,841||84,273|
|Total liabilities and stockholders' equity||$||145,421||$||118,610|
|FORTRESS BIOTECH, INC. AND SUBSIDIARIES|
|Condensed Consolidated Statement of Operations|
|($ in thousands except for share and per share amounts)|
|For the Three Months EndedSeptember 30,||For the Nine Months EndedSeptember 30,|
|Product revenue, net||$||429||$||-||$||1,793||$||-|
|Revenue - from a related party||546||25||2,072||525|
|Cost of goods sold - product revenue||41||-||365||-|
|Research and development||7,316||9,073||21,416||13,172|
|Research and development - licenses acquired||1,000||1,895||3,143||10,882|
|General and administrative||8,864||7,129||25,414||14,376|
|Total operating expenses||17,180||18,097||49,973||38,430|
|Loss from operations||(16,246||)||(18,072||)||(46,473||)||(37,905||)|
|Other income (expenses)|
|Interest expense and financing fees||(689||)||(350||)||(1,838||)||(1,033||)|
|Change in fair value of derivative liabilities||(16||)||-||(105||)||-|
|Change in fair value of subsidiary convertible note||(13||)||-||(13||)||-|
|Change in fair value of investments||(81||)||(1,472||)||(1,800||)||(65||)|
|Total other expenses||(710||)||(1,783||)||(3,515||)||(903||)|
|Less: net loss attributable to non-controlling interests||3,975||1,694||12,324||2,416|
|Net loss attributable to common stockholders||$||(12,981||)||$||(18,161||)||$||(37,664||)||$||(36,392||)|
|Basic and diluted net loss per common share||$||(0.32||)||$||(0.46||)||$||(0.94||)||$||(0.93||)|
|Weighted average common shares outstanding-basic and diluted||40,128,475||39,412,056||39,885,685||39,038,522|
Contact: Lucy Lu, MD, Executive Vice President & Chief Financial Officer Fortress Biotech, Inc. email@example.comMedia Relations:Laura Bagby6 Degrees312firstname.lastname@example.org