TIDMAMYT
AMRYT REPORTS RECORD Q3 2020 RESULTS
19% YoY revenue growth in the quarter to $49.3M
Raising full year revenue guidance to $180M - $182M
Both metreleptin and lomitapide driving revenue performance and growth
Strong cash generation with cash of $75.4M at September 30
Positive results reported from EASE pivotal Phase 3 study in
Epidermolysis Bullosa
Conference call and webcast today at 0930 EST / 1430 GMT
DUBLIN, Ireland, and Boston MA, November 5, 2020, Amryt (Nasdaq: AMYT,
AIM: AMYT), a global, commercial-stage biopharmaceutical company
dedicated to developing and commercializing novel therapeutics to treat
patients suffering from serious and life-threatening rare diseases,
today announces unaudited financial results and provides a business
update for the third quarter ended September 30, 2020.
-- 19% YoY growth in unaudited Q3 revenues to $49.3M (Q3 20191 unaudited
combined revenues: $41.4M)
-- 23% YoY growth in unaudited cumulative YTD revenues to $140.1M (Nine
months 20191 unaudited combined revenues: $113.6M)
-- 7% QoQ revenue growth in Q3 versus Q2 ($46.2M)
-- Raising FY 2020 revenue guidance from $170M - $175M to $180M - $182M
(20191: $154.1m)
-- $3.6M operating loss before finance expense in Q3. Excluding non-cash
items and share based compensation expenses, this resulted in EBITDA3 of
$13.5M in Q3 representing 96% QoQ growth
-- Strong cash generation during the nine months to September 2020 with
$21.1M of cash generated from operating activities YTD and $11.4M during
the quarter
-- Increase in cash from $67.1M at June 30, 2020 to $75.4M at September 30,
2020
-- Amryt announced positive results from EASE pivotal Phase 3 trial in EB.
The primary endpoint of the trial was achieved and demonstrated a
statistically significant acceleration of target wound healing by day 45
in patients treated with FILSUVEZ(R)2 vs control gel (p-value = 0.013)
representing a 44% increase in target wound closure with FILSUVEZ(R) vs
the control gel. EASE is the largest ever Phase 3 randomized controlled
study conducted in EB.
-- The RDEB sub-group was observed to experience a greater benefit when
treated with FILSUVEZ(R) than the overall population (nominal p=0.008)
representing a 72% increase in target wound closure with FILSUVEZ(R) vs
the control gel
-- Favourable trends were evident among secondary endpoints including change
in procedural pain, EBDASI score and BSAP
-- FILSUVEZ(R) had an acceptable safety profile and was well tolerated when
compared with control gel
-- On July 8, Amryt listed on the Nasdaq Global Select Market ("Nasdaq")
Joe Wiley, CEO of Amryt Pharma, commented:
"I am very pleased with today's record results which demonstrate the
positive performance and growth that our commercial products are
delivering alongside the significant progress we are achieving in our
exciting development pipeline of new therapeutic drug candidates. The
positive momentum we experienced during the first half of the year has
continued through Q3 and I am very pleased with both our revenue growth
and positive cash momentum. Furthermore, given the strong performance of
the business year to date we are now increasing our revenue guidance for
2020 from $170-$175 million to $180-$182 million.
We are also very pleased with the positive results for FILSUVEZ(R) from
our EASE Phase 3 trial in EB. EASE is the first ever Phase 3 study to
demonstrate positive data in this devastating disease and we look
forward to submitting this data to regulatory authorities in both the US
and Europe in early 2021. If approved, we intend to launch FILSUVEZ(R)
in the US in Q4 2021 and in Europe in Q1 2022.
Our two commercial products, metreleptin and lomitapide continue to
deliver growth across a host of metrics including revenue and EBITDA
growth, cash generation and market expansion. We have the management
team, systems and infrastructure in place to continue to grow our
existing commercial products and also to launch FILSUVEZ(R) if approved
next year".
Q3 and Recent Business Highlights:
-- In July, Amryt listed on Nasdaq
-- In September, Amryt announced positive top line data from the pivotal
EASE Global Phase 3 trial in EB. The primary endpoint was achieved with
statistical significance (p-value=0.013) representing a 44% increase in
target wound closure with FILSUVEZ(R) vs the control gel. EASE is the
largest ever Phase 3 study conducted in EB.
-- The RDEB sub-group was observed to experience a greater benefit when
treated with FILSUVEZ(R) than the overall population (nominal
p-value=0.008) representing a 72% increase in target wound closure with
FILSUVEZ(R) vs the control gel
-- In September, the European Medicines Agency ("EMA") Committee for Orphan
Medicinal Products ("COMP") adopted a positive opinion for orphan
designation for the use of AP103 in EB
-- In October, Amryt signed a distribution agreement for Lojuxta(R)
(lomitapide) with Swixx BioPharma AG ("Swixx") across 17 jurisdictions in
Central and Eastern Europe. This follows on from Amryt's appointment in
June 2020 of Swixx as exclusive distributor of Myalepta(R) (metreleptin)
across the CEE territories.
Q3 2020 Financial Highlights:
--$49.3M unaudited Q3 revenues representing a 19% increase on unaudited
combined revenues of $41.4M in Q3 2019(1)
--7% QoQ unaudited revenue growth in Q3 versus Q2 ($46.2M)
--31% growth in Myalept(R) / Myalepta(R) (metreleptin) revenues to
$29.9M in the quarter (Q3 2019: unaudited combined revenues(1) $22.9M).
Metreleptin revenues were bolstered by a $6.9M order in LATAM during Q3
2020. Unlike in other regions, ordering patterns in LATAM can be
sporadic in nature and therefore we do not expect this revenue to recur
in Q4.
--4% increase in Juxtapid(R)/Lojuxta(R) (lomitapide) revenues to $19.1M
in the quarter (Q3 2019: unaudited combined revenues(1) $18.3M)
--US accounted for 51% of global revenues and EMEA accounted for 28% of
global revenues in Q3
(1) Unaudited combined revenues for 2019 represent the combined
unaudited revenues of the Company assuming the acquisition by Amryt of
Aegerion happened on 1 January 2019. It also (i) excludes revenues from
sales to end-users in Japan following the out-licencing of Juxtapid to
Recordati in February 2019, (ii) excludes up-front payments from
Recordati in 2019, and (iii) includes a 22.5% royalty on Japanese sales
of Juxtapid from 1 January 2019 as if the Recordati agreement was in
place from that date.
(2) For the purposes of this announcement, we use the name FILSUVEZ(R)
which has been selected as the brand name for the product but please
note, Amryt does not, as yet, have regulatory approval for FILSUVEZ(R)
to treat EB
IFRS and non-GAAP adjusted Q3 results:
Q3 2020 Q3 2020
Q3 2019 Q3 2020 Non-cash Non-GAAP
US$M (unaudited) (unaudited) Items(4) Adjusted
---------------- ------------ ------------ --------------- ---------------
Revenue 8.6 49.3 - 49.3
---------------- ------------ ------------ --------------- ---------------
Gross profit 5.5 22.3 15.1 37.4
---------------- ------------ ------------ --------------- ---------------
R&D (2.4) (7.4) - (7.4)
---------------- ------------ ------------ --------------- ---------------
SG&A (6.0) (16.9) 0.5 (16.4)
---------------- ------------ ------------ --------------- ---------------
Acquisition &
severance
related costs (8.7) (0.1) - (0.1)
---------------- ------------ ------------ --------------- ---------------
Share based
compensation
expenses (0.1) (1.5) 1.5 -
---------------- ------------ ------------ --------------- ---------------
Operating (loss)
/ profit before
finance
expense (11.7) (3.6) 17.1 13.5(3)
---------------- ------------ ------------ --------------- ---------------
The Q3 operating loss of $3.6M includes the impact of non-cash items
including amortisation, depreciation and the impact of share-based
compensation expenses. Adjusting for these non-cash items, the Company
delivered $13.5M of EBITDA(3) for the quarter. R&D expenses increased
to $7.4M in Q3 (Q2: $6.2M). SG&A expenses decreased in Q3 to $16.9M
(Q2: $21.6M).
(3) EBITDA is earnings before interest, tax, depreciation, amortisation
and share based compensation expenses. To supplement Amryt's financial
results presented in accordance with IFRS generally accepted accounting
principles, the Company uses EBITDA as a key measure of company
performance as the Company believes that this measure is most reflective
of the operational profitability or loss of the Company and provides
management and investors with useful supplementary information which can
enhance their ability to evaluate the operating performance of the
business. EBITDA, as measured by the Company, is not meant to be
considered in isolation or as a substitute to operating profit / loss
attributable to Amryt and should be read in conjunction with the
Company's condensed consolidated financial statements prepared in
accordance with IFRS.
(4) Non-cash items include amortisation of the acquired metreleptin and
lomitapide intangible assets ($10.0M), amortisation of the inventory
fair value step-up that was acquired at the acquisition date ($5.1M),
depreciation ($0.5M) and share based compensation expenses ($1.5M).
Financial Position:
Cash generated from operating activities in Q3 was $11.4M. During the
quarter, the Company paid $1.5M in net finance payments, $4.2M in
residual payments related to legacy fines levied on Aegerion and $0.4M
in capital expenditure. The legacy fines will be fully discharged by
the end of Q1 2021. At September 30, 2020, the Company had cash of
$75.4M (unaudited), compared to cash at June 30, 2020 of $67.1M
(unaudited).
Raising FY 2020 Financial Guidance:
Revenues for the FY 2020 are expected to be in the range of $180M-$182M
compared to prior guidance of $170M -$175M.
Webcast and Conference Call:
Management will host a webcast for analysts and investors today at 0930
EST / 1430 GMT.
Webcast Player URL:
https://www.globenewswire.com/Tracker?data=TdUkoABjG6XFp6qGPRXMV2SMvNU0ADWGKhgNYmj9bV7fo10X2-8OffarVrlHBMtyoOFMtQjb37iuBRVP4HuLMqjlQs4PzjvqSwip1AdbdaDzXNH86KBL7bIHyQHPdhCEEpJzoi6H9vdwNOLre1_lJglFBDgmZB9dFEmw8XLWTtBbHF7Yy8Wzl-ACX3l5A2KNQXLazLx7zB1zXTRrCvPwBhtBsrwiipsvCbuZcKq28MAxDNgG7L1xNGu-SamyR2H05ZRrHCWBWt7tCvQ3Q8qaUrQ0w7-DRXFUIFfTry7mauQZgNjyOxDFdueYDk8_gwyw8z3Shii--1hZXLMLh8UIfYImdW6S8Uj_g4FqLUCK09E=
https://edge.media-server.com/mmc/p/dor9m4ay
Telephone Dial in details:
Standard International
Number +44 (0) 203 009 5709
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United States +1 646 787 1226
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United Kingdom (Local) +44 (0) 844 493 6766
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Ireland + 353 (1) 506 0626
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Confirmation Code 2865629
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A playback facility will be available from November 5, 2020 at 1930 GMT
-- November 12, 2020 at 1930 GMT. Access details as follows:
Confirmation Code: 2865629 ; US: +1 917 677 7532 ; UK/International: +44
(0) 3333 00 9785 ; Ireland: +353 (1) 553 8777.
Enquiries:
Amryt Pharma plc +353 (1) 518 0200
Joe Wiley, CEO
Rory Nealon, CFO/COO
LifeSci Advisors, LLC +1 (212) 915 2564
Tim McCarthy
Consilium Strategic Communications +44 (0) 20 3709 5700
Amber Fennell, Matthew Neal, Ashley Tapp
About Amryt
Amryt is a biopharmaceutical company focused on developing and
delivering innovative new treatments to help improve the lives of
patients with rare and orphan diseases. Amryt comprises a strong and
growing portfolio of commercial and development assets.
Amryt's commercial business comprises two orphan disease products.
Amryt's lead development candidate, FILSUVEZ(R) is a potential treatment
for the cutaneous manifestations of EB, a rare and distressing genetic
skin disorder affecting young children and adults for which there is
currently no approved treatment. In September and October 2020, Amryt
reported positive results from its pivotal global phase 3 trial of
FILSUVEZ(R) in EB. FILSUVEZ(R) has been granted Rare Pediatric Disease
Designation and has also received a Fast Track Designation from the U.S.
Food and Drug Administration.
Myalept(R) / Myalepta(R) (metreleptin) is approved in the US (under the
trade name Myalept(R)) as an adjunct to diet as replacement therapy to
treat the complications of leptin deficiency in patients with congenital
or acquired generalized lipodystrophy (GL) and in the EU (under the
trade name Myalepta(R)) for the treatment of leptin deficiency in
patients with congenital or acquired GL in adults and children two years
of age and above and familial or acquired partial lipodystrophy (PL) in
adults and children 12 years of age and above for whom standard
treatments have failed to achieve adequate metabolic control.
Metreleptin is also approved for lipodystrophy in Japan. Generalised and
partial lipodystrophy are rare disorders characterised by loss or lack
of adipose tissue resulting in the deficiency of the hormone leptin,
produced by fat cells and are associated with severe metabolic
abnormalities including severe insulin resistance, diabetes,
hypertriglyceridemia and fatty liver disease.
Juxtapid(R)/ Lojuxta(R) (lomitapide) is approved as an adjunct to a
low-fat diet and other lipid-lowering medicinal products for adults with
the rare cholesterol disorder, Homozygous Familial Hypercholesterolaemia
("HoFH") in the US, Canada, Columbia, Argentina and Japan (under the
trade name Juxtapid(R)) and in the EU (under the trade name Lojuxta(R)).
HoFH is a rare genetic disorder which impairs the body's ability to
remove low density lipoprotein ("LDL") cholesterol ("bad" cholesterol)
from the blood, typically leading to abnormally high blood LDL
cholesterol levels in the body from before birth - often ten times more
than people without HoFH - and subsequent aggressive and premature
cardiovascular disease.
In March 2018, Amryt in-licenced a pre-clinical gene-therapy platform
technology, AP103, which offers a potential treatment for patients with
Recessive Dystrophic Epidermolysis Bullosa, a subset of EB, and is also
potentially relevant to other genetic disorders. For more information
on Amryt, including products, please visit www.amrytpharma.com.
This announcement contains inside information for the purposes of
article 7 of the Market Abuse Regulation (EU) 596/2014. The person
making this notification on behalf of Amryt is Rory Nealon, CFO/COO and
Company Secretary.
Financial Advisors
Shore Capital (Edward Mansfield, Daniel Bush, John More) are NOMAD and
Joint Broker to Amryt in the UK. Stifel (Ben Maddison) are Joint Broker
to the company in the UK. Davy (John Frain, Daragh O'Reilly) act as
Joint Broker to the company.
Forward-Looking Statements
Statements in this announcement with respect to Amryt's business,
strategies, timing for completion of and announcing results from the
EASE trial, the potential impact of closing enrollment in the EASE trial,
as well as other statements that are not historical facts are
forward-looking statements involving risks and uncertainties which could
cause the actual results to differ materially from such statements.
Statements containing the words "expect", "anticipate", "intends",
"plan", "estimate", "aim", "forecast", "project" and similar expressions
(or their negative) identify certain of these forward-looking
statements. The forward-looking statements in this announcement are
based on numerous assumptions and Amryt's present and future business
strategies and the environment in which Amryt expects to operate in the
future. Forward-looking statements involve inherent known and unknown
risks, uncertainties and contingencies because they relate to events and
depend on circumstances that may or may not occur in the future and may
cause the actual results, performance or achievements to be materially
different from those expressed or implied by such forward-looking
statements. These statements are not guarantees of future performance or
the ability to identify and consummate investments. Many of these risks
and uncertainties relate to factors that are beyond each of Amryt's
ability to control or estimate precisely, such as future market
conditions, the course of the COVID-19 pandemic, currency fluctuations,
the behaviour of other market participants, the outcome of clinical
trials, the actions of regulators and other factors such as Amryt's
ability to obtain financing, changes in the political, social and
regulatory framework in which Amryt operates or in economic,
technological or consumer trends or conditions. Past performance should
not be taken as an indication or guarantee of future results, and no
representation or warranty, express or implied, is made regarding future
performance. No person is under any obligation to update or keep current
the information contained in this announcement or to provide the
recipient of it with access to any additional relevant information that
may arise in connection with it. Such forward-looking statements reflect
the Company's current beliefs and assumptions and are based on
information currently available to management.
Amryt Pharma plc
Condensed Consolidated Statement of Comprehensive Loss
Three Months Ended Nine Months Ended
September 30, September 30,
2020 2019 2020
(unaudited) (unaudited) (unaudited) 2019 (unaudited)
------------- ------------- ------------- ----------------------
Note US$'000 US$'000
---- ---------------------------- -------------------------------------
Revenue 3 49,326 8,637 140,085 17,828
Cost of sales (27,057) (3,127) (89,148) (6,831)
--------- --------- --------- -------------------
Gross profit 22,269 5,510 50,937 10,997
Research and development expenses (7,350) (2,414) (22,481) (7,632)
Selling, general and administrative
expenses (16,889) (5,999) (56,883) (15,946)
Acquisition and severance related
costs (105) (8,743) (1,005) (11,362)
Share based payment expenses 4 (1,533) (97) (3,136) (319)
--------- --------- --------- -------------------
Operating loss before finance expense (3,608) (11,743) (32,568) (24,262)
--------- --------- --------- -------------------
Non-cash change in fair value of contingent
consideration 5 (2,126) (1,448) (8,150) (5,299)
Non-cash contingent value rights finance
expense 5 (1,557) -- (4,498) --
Net finance expense - other (1,359) (2,291) (15,492) (3,623)
Loss on ordinary activities before
taxation (8,650) (15,482) (60,708) (33,184)
--------- --------- --------- -------------------
Tax (charge)/credit on loss on ordinary
activities (1,821) (77) 3,171 (93)
--------- --------- --------- -------------------
Loss for the period attributable to
the equity holders of the Company (10,471) (15,559) (57,537) (33,277)
========= ========= ========= ===================
Exchange translation differences which
may be reclassified through profit
or loss (1,921) 59 (2,850) 59
--------- --------- --------- -------------------
Total other comprehensive loss (1,921) 59 (2,850) 59
--------- --------- --------- -------------------
Total comprehensive loss for the period
attributable to the equity holders
of the Company (12,392) (15,500) (60,387) (33,218)
========= ========= ========= ===================
Loss per share
Loss per share - basic and diluted,
attributable to ordinary equity holders
of the parent (US$) 6 (0.07) (0.28) (0.37) (0.69)
========= ========= ========= ===================
Amryt Pharma plc
Condensed Consolidated Statement of Financial Position
As at,
December
September 31,
30, 2019 restated
2020 (see note
(unaudited) 15)
Note US$'000
---- --------------------------------
Assets
Non-current assets
Goodwill 7 24,086 24,086
Intangible assets 7 312,704 342,327
Property, plant and equipment 6,859 3,036
Other non-current assets 1,277 1,873
Total non-current assets 344,926 371,322
--------- --- ----------- ---
Current assets
Trade and other receivables 8 42,195 35,500
Inventories 44,932 58,000
Cash and cash equivalents, including restricted
cash 9 75,382 67,229
Total current assets 162,509 160,729
Total assets 507,435 532,051
========= === =========== ===
Equity and liabilities
Equity attributable to owners of the parent
Share capital 10 12,548 11,918
Share premium 10 16,553 2,422
Other reserves 234,099 248,630
Accumulated deficit (188,618) (131,137)
Total equity 74,582 131,833
--------- --- ----------- ---
Non-current liabilities
Contingent consideration and contingent value
rights 5 117,791 102,461
Deferred tax liability 9,649 12,102
Long term loan 11 85,835 81,610
Convertible notes 12 99,986 96,856
Provisions and other liabilities 13 4,657 4,963
Total non-current liabilities 317,918 297,992
--------- --- ----------- ---
Current liabilities
Trade and other payables 100,226 78,351
Provisions and other liabilities 13 14,709 23,875
Total current liabilities 114,935 102,226
Total liabilities 432,853 400,218
--------- --- ----------- ---
Total equity and liabilities 507,435 532,051
========= ===========
Amryt Pharma plc
Condensed Consolidated Statement of Cash Flows
Nine Months Ended
September 30,
2020 2019
(unaudited) (unaudited)
Note US$'000
---- ------------------------------
Cash flows from operating activities
Loss on ordinary activities after taxation (57,537) (33,277)
Net finance expense - other 15,492 3,623
Depreciation and amortization 33,313 447
Amortization of inventory fair value step-up 21,015 --
Share based payment expenses 4 3,136 319
Non-cash change in fair value of contingent
consideration 5 8,150 5,299
Non-cash contingent value rights finance expense 5 4,498 --
Deferred taxation credit (2,452) --
Movements in working capital and other adjustments:
Change in trade and other receivables 8 (6,695) (1,575)
Change in trade and other payables 21,875 3,951
Change in provision and other liabilities 13 (12,328) --
Change in inventories (7,948) (1,078)
Change in non-current assets 596 72
Net cash flow from (used in) operating activities 21,115 (22,219)
--------- --- ---------
Cash flow from investing activities
Net cash received on acquisition of subsidiary -- 24,985
Payments for property, plant and equipment (147) (465)
Payments for intangible assets (298) --
Deposit interest received 86 2
Net cash flow (used in) from investing activities (359) 24,522
--------- --------- ---
Cash flow from financing activities
Proceeds from issue of equity instruments -- 45,162
Proceeds from long term debt borrowings net of debt
issue costs -- 27,551
Repayment of long term debt -- (21,990)
Payment of leases (846) (239)
Interest paid (6,190) (2,019)
Net cash flow (used in) from financing activities (7,036) 48,465
--------- --------- ---
Exchange and other movements (5,567) (354)
--------- ---------
Net change in cash and cash equivalents 8,153 50,414
Cash and cash equivalents at beginning of the period 67,229 11,226
--------- ---------
Restricted cash at end of the period 792 16,051
========= =========
Cash at bank available on demand at end of the
period 74,590 45,589
========= =========
Total cash and cash equivalents at end of the period 75,382 61,640
========= =========
Amryt Pharma plc
Condensed Consolidated Statement of Changes in Equity
For the period ended September 30, 2020
Share Equity
based Reverse component Other Currency
Share Share Warrant Treasury payment Merger acquisition of convertible distributable translation Accumulated
capital premium reserve shares reserve reserve reserve notes reserves reserve deficit Total
--------
Note US$'000
---- --------------------------------------------------------------------------------------------------------------------------------------------------------
Balance at January 1, 2020
restated (see note 15) 11,918 2,422 29,523 (7,534) 3,190 42,627 (73,914) 29,210 217,634 7,894 (131,137) 131,833
Loss for the period -- -- -- -- -- -- -- -- -- -- (57,537) (57,537)
Foreign exchange translation
reserve -- -- -- -- -- -- -- -- -- (2,850) -- (2,850)
Total comprehensive loss
for the period -- -- -- -- -- -- -- -- -- (2,850) (57,537) (60,387)
------- ------- ------- ------- ------- -------- --------- --- --------------- ---------- ---- -------- --- --------- -------
Transactions with owners
Issue of shares in exchange
for warrants 10 630 14,131 (14,761) -- -- -- -- -- -- -- -- --
Share based payment expense 4 -- -- -- -- 3,136 -- -- -- -- -- -- 3,136
Share based payment expense
-- lapsed -- -- -- -- (56) -- -- -- -- -- 56 --
Total transactions with
owners 630 14,131 (14,761) -- 3,080 -- -- -- -- -- 56 3,136
Balance at September 30,
2020 (unaudited) 12,548 16,553 14,762 (7,534) 6,270 42,627 (73,914) 29,210 217,634 5,044 (188,618) 74,582
======= ======= ======= ======= ======= ======== ========= =============== ========== ==== ======== ==== ========= =======
Amryt Pharma plc
Condensed Consolidated Statement of Changes in Equity
For the period ended September 30, 2019
Share Equity
based Reverse component Other Currency
Share Share Warrant Treasury payment Merger acquisition of convertible distributable translation Accumulated
capital premium reserve shares reserve reserve reserve notes reserves reserve deficit Total
--------
Note US$'000
---- --------------------------------------------------------------------------------------------------------------------------------------------------------
Balance at January 1, 2019
(audited) 25,198 68,233 -- -- 6,473 42,627 (73,914) -- -- (51) (72,263) (3,697)
Loss for the period -- -- -- -- -- -- -- -- -- -- (33,277) (33,277)
Foreign exchange translation
reserve -- -- -- -- -- -- -- -- -- 59 -- 59
Total comprehensive loss
for the period -- -- -- -- -- -- -- -- -- 59 (33,277) (33,218)
------- ------- ------- ------- ------- -------- --------- --- --------------- ---------- ---- -------- ---- --------- -------
Transactions with owners
Share consolidation 10 (21,262) 21,262 -- -- -- -- -- -- -- -- -- --
Issue of shares in August
2019 equity fund raise 10 533 7,467 -- -- -- -- -- -- -- -- -- 8,000
Issue costs associated with
August 2019 equity fund
raise 10 -- (1,886) -- -- -- -- -- -- -- -- -- (1,886)
Acquisition of subsidiary
without a change of control 10 (495) (3,726) -- -- -- -- -- -- (2,969) 7,190 -- --
Issue of shares and warrants
in consideration of Aegerion
Acquisition 10 5,759 132,392 14,464 -- -- -- -- -- -- -- -- 152,615
Issue of shares and warrants
in equity fund raise 10 2,059 47,338 10,603 -- -- -- -- -- -- -- -- 60,000
Issue costs associated with
September 2019 equity fund
raise 10 -- (2,575) (530) -- -- -- -- -- -- -- -- (3,105)
Issue of convertible notes 12 -- -- -- -- -- -- -- 29,210 -- -- -- 29,210
Issue of contingent value
rights 5 -- -- -- -- -- -- -- -- (47,902) -- -- (47,902)
Share based payment expense 4 -- -- -- -- 319 -- -- -- -- -- -- 319
Total transactions with
owners (13,406) 200,272 24,537 -- 319 -- -- 29,210 (50,871) 7,190 -- 197,251
Balance at September 30,
2019 (unaudited) 11,792 268,505 24,537 -- 6,792 42,627 (73,914) 29,210 (50,871) 7,198 (105,540) 160,336
======= ======= ======= ======= ======= ======== ========= =============== ========== === ======== ==== ========= =======
1. General information
We are a global, commercial-stage biopharmaceutical company dedicated to
commercializing and developing novel therapeutics to treat patients
suffering from serious and life-threatening rare diseases.
As used herein, references to "we," "us," "Amryt" or the "Group"
in these condensed consolidated interim financial statements shall mean
Amryt Pharma plc and its global subsidiaries, collectively. References
to the "Company" in these condensed consolidated interim financial
statements shall mean Amryt Pharma plc.
Amryt Pharma plc is a company incorporated in England and Wales. The
Company is listed on Nasdaq (ticker:AMYT) and the AIM market of the
London Stock Exchange (ticker: AMYT).
Aegerion Pharmaceuticals, Inc. ("Aegerion"), a former subsidiary of
Novelion Therapeutics Inc. ("Novelion"), is a rare and orphan disease
company with a diversified offering of multiple commercial and
development stage assets. The acquisition of Aegerion by Amryt in
September 2019 has given Amryt an expanded commercial footprint to
market two U.S. and EU approved products, lomitapide (JUXTAPID (U.S.) /
LOJUXTA (EU)) and metreleptin (MYALEPT (U.S.) / MYALEPTA (EU)).
On July 10, 2019, the shareholders of the Company approved a resolution
to give authority to the Company to undertake a consolidation of the
existing ordinary shares in the capital of the Company under which every
six existing ordinary shares were consolidated into one ordinary share.
The number of shares in issue at September 30, 2019 has been adjusted to
reflect this share consolidation on July 10, 2019 for the purposes of
the loss per share calculation. The number of share options outstanding
at January 1, 2019 and the share options granted and lapsing during the
nine months ended September 30, 2019 have been restated to reflect the
2019 share consolidation.
On September 20, 2019, Amryt registered FILSUVEZ(R) as the trademark
name for the Group's lead development asset, AP101, in the European
Union. On February 18, 2020, Amryt also registered this trademark name
in the United States and is in the process of registering the
FILSUVEZ(R) trademark in other key jurisdictions.
On July 8, 2020, Amryt listed on the NASDAQ Global Select Market under
the symbol AMYT. The Company has not issued any new securities in
connection with this filing. The Ordinary Shares will continue to trade
on the AIM market of the London Stock Exchange.
On August 11, 2020 announced that the Company gave Euronext Dublin
("Euronext") notice of its intention to cancel the admission of the
Company's Ordinary Shares ('Ordinary Shares") to trading on the Euronext
Growth Market ("Cancellation"). The last day of trading in Ordinary
Shares on the Euronext Growth Market was September 8, 2020. The
Cancellation applies only to the Euronext Growth Market and will have no
effect on the Company's American Depositary Shares ("ADSs") which trade
on the NASDAQ Global Select Market under the symbol AMYT or on Amryt's
Ordinary Shares trading on the AIM market of the London Stock Exchange.
2. Accounting policies
Basis of preparation
The condensed consolidated interim financial statements of the Group
have been prepared in accordance with IAS 34 Interim Financial
Reporting. They do not include all of the information required in annual
financial statements in accordance with International Financial
Reporting Standards ("IFRS") and should be read in conjunction with
the annual consolidated financial statements for the year ended December
31, 2019. Selected explanatory notes are included to explain events and
transactions that are significant to an understanding of the Group's
financial position and performance since the last annual financial
statements. The accounting policies used in the preparation of the
interim financial information are the same as those used in the Group's
audited financial statements for the year ended December 31, 2019 and
those which are expected to be used in the financial statements for the
year ending December 31, 2020.
Results for the nine-month period ended September 30, 2020 are not
necessarily indicative of the results that may be expected for the
financial year ending December 31, 2020.
Basis of going concern
Having considered the Group's current financial position and cash flow
projections, the Board of Directors believes that the Group will be able
to continue in operational existence for at least the next 12 months
from the date of approval of these condensed consolidated interim
financial statements and that it is appropriate to continue to prepare
the condensed consolidated interim financial statements on a going
concern basis.
A key consideration for the impact on going concern is the acquisition
of Aegerion, which was completed in September 2019. This acquisition
represents a significant step forward for Amryt and has created value
for Amryt with immediate effect post-deal close through enhanced scale
of the combined Group, which Amryt believes has the potential to drive
revenues and deliver operational synergies through a combination of
medical, commercial, clinical, development and regulatory
infrastructure. Additionally, Amryt completed a US$60,000,000
fundraising as part of the acquisition of Aegerion.
Since a novel strain of coronavirus (SARS-CoV-2) causing a disease
referred to as COVID-19 was first reported in December 2019, the disease
has spread across the world, including countries in which we have
patients and in which we have planned or active clinical trial sites.
The outbreak and government measures taken in response have had a
significant impact, both direct and indirect, on all businesses and
commerce as supply chains have been disrupted, facilities and production
have been suspended and demand for certain goods and services has spiked
while demand for other goods and services has fallen. As COVID-19
continues to spread around the globe, Amryt may experience disruptions
that could affect its business, preclinical studies and clinical trials.
Amryt provides therapeutic products to Homozygous Familial
Hypercholesterolemia ("HoFH") and lipodystrophy patients globally on a
recurring basis. Once lomitapide (for the treatment of HoFH) or
metreleptin (for the treatment of lipodystrophy) is prescribed by
physicians, patients are typically on treatment over a long period of
time with repeat prescriptions for each patient. To date the Group has
seen minimal impact of the COVID-19 pandemic on the business given the
majority of revenues are recurring in nature and the Group has a strong
cash position and resources to support the Group's ability to continue
as a going concern.
Basis of consolidation
The condensed consolidated interim financial statements comprise the
financial statements of the Group for the nine months ended September
30, 2020. Subsidiaries are entities controlled by the Company. Where the
Company has control over an investee, it is classified as a subsidiary.
The Company controls an investee if all three of the following elements
are present: power over an investee, exposure or rights to variable
returns from its involvement with the investee and the ability to use
its power to affect those variable returns. Control is reassessed
whenever facts and circumstances indicate that there may be a change in
any of these elements of control.
Subsidiaries are fully consolidated from the date that control commences
until the date that control ceases. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with the
policies adopted by the Group. Intergroup balances and any unrealized
gains or losses, income or expenses arising from intergroup transactions
are eliminated in preparing the consolidated financial statements.
Presentation of balances
The condensed consolidated interim financial statements are presented in
U.S. dollars ("US$") which is the functional currency of the Company
and presentation currency of the Group.
The following table discloses the major exchange rates of those
currencies other than the functional currency of US$ that are utilized
by the Group:
Foreign currency units
to 1 US$ EUR GBP CHF SEK NOK DKK
------ ------ ------ ------ ------ --------
Average three-month
period to September
30, 2019 (unaudited) 0.8898 0.7857 0.9950 9.3993 8.6944 6.6422
Average nine-month period
to September 30, 2019
(unaudited) 0.8992 0.8110 0.9855 9.5838 8.8586 6.7109
At September 30, 2019
(unaudited) 0.9140 0.8137 0.9910 9.7939 9.0757 6.8240
Foreign currency units
to 1 US$ EUR GBP CHF SEK NOK DKK
------ ------ ------ ------ ------ --------
Average period to December
31, 2019 (audited) 0.8932 0.7836 0.9938 9.4533 8.7976 6.6690
At December 31, 2019
(audited) 0.8929 0.7624 0.971 9.3282 8.8046 6.6698
Foreign currency units
to 1 US$ EUR GBP CHF SEK NOK DKK
------ ------ ------ ------ ------ --------
Average three-month
period to September
30, 2020 (unaudited) 0.8905 0.7873 0.9508 9.4111 9.5480 6.6422
Average nine-month period
to September 30, 2020
(unaudited) 0.8562 0.7749 0.9203 8.8756 9.1384 6.3740
At September 30, 2020
(unaudited) 0.8543 0.7777 0.9220 9.0060 9.4528 6.3604
(EUR = Euro; GBP = Pounds Sterling, CHF = Swiss Franc, SEK = Swedish
Kroner, NOK = Norwegian Kroner, DKK = Danish Kroner)
Changes in accounting policies and disclosures
In the current year, the Group has applied the amendments to IFRS
related to IFRS 3 and the definition of a business. These amendments and
interpretations do not have significant impact on the disclosures or the
amounts reported in these condensed consolidated interim financial
statements.
Critical accounting judgements and key sources of estimation uncertainty
The preparation of financial statements in conformity with IFRS requires
management to make judgements, estimates and assumptions that affect the
application of policies and amounts reported in the financial statements
and accompanying notes. The estimates and associated assumptions are
based on historical experience and various other factors that are
believed to be reasonable under the circumstances, the results of which
form the basis of making the judgements about the carrying value of
assets and liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognized in the period in
which the estimate is revised if the revision affects only that period
or in the period of the revision and future periods if the revision
affects both current and future periods.
The significant estimates, assumptions or judgements, applied in the
condensed consolidated interim financial statements were the same as
those applied in the Group's audited financial statements for the year
ended December 31, 2019 other than for those applied in finalizing the
acquisition accounting for the Aegerion acquisition (see Note 5,
Business combinations and asset acquisitions).
Principal accounting policies
The condensed consolidated interim financial statements have been
prepared in accordance with the accounting policies adopted in the
Group's audited financial statements for the year ended December 31,
2019.
3. Segment information
The Group is a global, commercial-stage biopharmaceutical company
dedicated to commercializing and developing novel therapeutics to treat
patients suffering from serious and life-threatening rare diseases.
The Group currently operates as one business segment, pharmaceuticals,
and is focused on the development and commercialization of two
commercial products and two development products. The Group derives its
revenues primarily from one source, the pharmaceutical sector with high
unmet medical need.
The Group's Chief Executive Officer, Joseph Wiley, is currently the
Group's chief operating decision maker ("CODM"). The Group does not
operate any separate lines of business or separate business entities
with respect to its products. Accordingly, the Group does not accumulate
discrete financial information with respect to separate service lines
and does not have separate reportable segments.
The following table summarizes total revenues from external customers by
product and by geographic region, based on the location of the customer.
Revenues represent the revenue from the Group for the three and nine
months ended September 30, 2020 and 2019. Revenue in the three and nine
months ended September 30, 2020 include revenues from the acquired
Aegerion Group and associated products and regions following the
acquisition of the Aegerion Group that was completed on September 24,
2019.
Three months ended September 30, 2020
(unaudited)
---------------------------------------------
U.S. EMEA Other Total
---------- ---------- -------- -----------
US$'000
---------------------------------------------
Metreleptin 15,877 6,423 7,578 29,878
Lomitapide 9,233 7,109 2,771 19,113
Other -- 201 134 335
Total revenue 25,110 13,733 10,483 49,326
========== ========== ======== =========
Three months ended September 30, 2019
(unaudited)
---------------------------------------------
U.S. EMEA Other Total
----------- ---------- ------ ------------
US$'000
---------------------------------------------
Metreleptin 1,036 694 35 1,765
Lomitapide 1,319 5,143 243 6,705
Other -- 167 -- 167
Total revenue 2,355 6,004 278 8,637
=========== ========== ====== ==========
Nine months ended September 30, 2020 (unaudited)
U.S. EMEA Other Total
------------ ------------ ----------- ---------------
US$'000
--------------------------------------------------------
Metreleptin 45,457 26,233 13,014 84,704
Lomitapide 28,047 18,683 7,856 54,586
Other -- 573 222 795
Total revenue 73,504 45,489 21,092 140,085
============ ============ =========== =============
Nine months ended September 30, 2019 (unaudited)
U.S. EMEA Other Total
------------ -------------- -------- ----------------
US$'000
--------------------------------------------------------
Metreleptin 1,036 694 35 1,765
Lomitapide 1,319 14,036 243 15,598
Other -- 465 -- 465
Total revenue 2,355 15,195 278 17,828
============ ============== ======== ==============
Major Customers
For the three and nine months ended September 30, 2020, one customer
accounted for 51% and 52%, respectively, of the Group's net revenues and
accounted for 37% of the Group's September 30, 2020 accounts receivable
balance. For the three and nine months ended September 30, 2019, the
Group generated over 51% and 61%, respectively, of its lomitapide
revenue in Italy, the Netherlands and Greece. The largest lomitapide
customer in the three and nine months ended September 30, 2019 was a
distributor in Italy.
4. Share based payments
Share Options and Warrants
On July 10, 2019, the shareholders of the Company approved a resolution
to give authority to the Company to undertake a consolidation of the
existing ordinary shares in the capital of the Company under which every
6 existing ordinary shares were consolidated into one ordinary share.
Under the terms of the Company's Employee Share Option Plan, options to
purchase 18,753,648 shares were outstanding at September 30, 2020. Under
the terms of this plan, options are granted to officers, consultants and
employees of the Group at the discretion of the Remuneration Committee.
A total of 4,432,000 share options were granted to non-executive
directors and employees in the nine-month period ended September 30,
2020. For the year ended December 31, 2019, a total of 11,330,641 share
options were granted to directors and employees.
Outstanding warrants at September 30, 2020 consisted of 8,966,520 zero
cost warrants (December 31, 2019: 17,196,273) with no expiration date
that were issued to Aegerion creditors in connection with the
acquisition of Aegerion. The remaining warrants consisting of 345,542
warrants (December 31, 2019: 345,542) were issued in connection with the
admission to the AIM in 2016.
The number and weighted average exercise price (in Sterling pence) of
share options and warrants per ordinary share is as follows:
Share Options Warrants
Weighted Weighted average
average exercise exercise price
price (Sterling (Sterling
Units pence) Units pence)
Balance at January 1, 2019
(restated for 6:1 share consolidation) 3,250,855 115.20p 3,818,325 144.00p
Granted 11,330,641 117.01p 18,841,378 --
Lapsed (99,776) 197.66p (3,472,783) 144.00p
Exercised -- -- (1,645,105) --
---------- ----------------- ---------- ------------------
Outstanding at December 31,
2019 (audited) 14,481,720 116.00p 17,541,815 0.03p
Exercisable at December 31,
2019 (audited) 2,468,310 109.08p 17,541,815 0.03p
---------------------------------------- ---------- ----------------- ---------- ------------------
Balance at January 1, 2020 14,481,720 116.00p 17,541,815 0.03p
Granted 4,432,000 144.76p -- --
Lapsed (87,119) 113.42p -- --
Exercised (72,953) 120.72p (8,229,753) --
Outstanding at September 30,
2020 (unaudited) 18,753,648 122.79p 9,312,062 0.05p
---------------------------------------- ---------- ----------------- ---------- ------------------
Exercisable at September 30,
2020 (unaudited) 3,025,547 107.49p 9,312,062 0.05p
---------- ----------------- ---------- ------------------
Fair value is estimated at the date of grant using the Black-Scholes
pricing model, taking into account the terms and conditions attached to
the grant. The following are the inputs to the model for the equity
instruments granted during the period:
September 30, September 30, December 31, December 31,
2020 Options 2020 Warrant 2019 Options 2019 Warrant
Inputs Inputs Inputs Inputs
(unaudited) (unaudited) (audited) (audited)
------------- ------------- ------------- ---------------
Days to Expiration 2,555 -- 2,555 --
Volatility 33% - 37% -- 27% - 48% --
Risk free interest 0.35% - 0.46% -- 0.38% - 0.83% --
rate
Share price at 123.5p -- -- 75.84p -- --
grant 178.94p 121.5p
In the nine months ended September 30, 2020, a total of 4,432,000 share
options exercisable at a weighted average price of GBP1.4476 were
granted. The fair value of share options granted in the nine months
ended September 30, 2020 was GBP6,415,586/US$8,230,000. The share
options outstanding as at September 30, 2020 have a weighted remaining
contractual life of 5.71 years with exercise prices ranging from GBP0.76
to GBP1.79.
The 2016 warrants outstanding as at September 30, 2020 have a weighted
remaining contractual life of 0.55 years with an exercise price of
GBP1.44.
Restricted Share Units
Under the terms of the Company's Employee Share Option Plan, restricted
share units ("RSUs") to purchase 1,556,960 shares were outstanding at
September 30, 2020. Under the terms of this plan, RSUs are granted to
officers, consultants and employees of the Group at the discretion of
the Remuneration Committee. A total of 1,556,960 RSUs were granted to
employees in the nine-month period ended September 30, 2020. For the
year ended December 31, 2019, no RSUs were granted to employees. The
fair value of the RSUs is based on the share price at the date of grant,
with the expense spread over the vesting period. The fair value of RSUs
granted in the nine months ended September 30, 2020 was US$2,742,000 and
have a weighted remaining contractual life of 2.86 years. The following
table summarises the RSU activity for the period:
RSUs
Weighted average
Units fair value (US$)
Balance at January 1, 2020 -- --
Granted 1,556,960 $2.27
Lapsed -- --
Exercised -- --
------------------------- -----------------
Outstanding at September 30,
2020 1,556,960 $2.27
------------------------- -----------------
The total share based payment expense charged to the Consolidated
Statement of Comprehensive Loss during the three and nine-month periods
are as follows:
Three months ended Nine months ended
September 30, September 30,
2020 2019 2020 2019
(unaudited) (unaudited) (unaudited) (unaudited)
------------ ------------ ------------ ---------------
US$'000
---------------------------------------------------------
Share option
expense 1,307 97 2,910 319
RSU expense 226 -- 226 --
Total share
option
expense 1,533 97 3,136 319
============ ============ ============ =============
5. Business combinations and asset acquisitions
Acquisition of Aegerion Pharmaceuticals ("Aegerion acquisition")
On May 20, 2019, Amryt entered into a Restructuring Support Agreement
(as subsequently amended on June 12, 2019) and Plan Funding Agreement
pursuant to which, among other matters, Amryt agreed to the acquisition
of Aegerion, a former wholly-owned subsidiary of Novelion. On May 20,
2019, Aegerion and its U.S. subsidiary, Aegerion Pharmaceuticals
Holdings, Inc., filed voluntary petitions under Chapter 11 of Title 11
of the U.S. Code in the Bankruptcy Court. On September 24, 2019, Amryt
completed the acquisition of Aegerion. Amryt acquired Aegerion upon its
emergence from bankruptcy in an exchange for ordinary shares and zero
cost warrants in Amryt. Amryt issued 85,092,423 effective shares at
US$1.793 per share, which is made up of 77,027,423 ordinary shares and
8,065,000 zero cost warrants, to acquire Aegerion for a value of
US$152,615,000.
The acquired goodwill is attributable principally to the profit
generating potential of the businesses, the assembled workforce and
benefits arising from embedded infrastructure, that are expected to be
achieved from integrating the acquired businesses into the Group's
existing business. No amount of goodwill is expected to be deductible
for tax purposes.
IFRS 3 Business combinations requires the assignment of fair values to
identifiable assets and liabilities acquired to be completed within 12
months of the acquisition date. The initial assignment of fair values
was included in the consolidated financial statement for the year ending
December 31, 2019 and subsequent consolidated interim financial
statements. The Group finalised the fair values of the assets and
liabilities of Aegerion in September 2020. The adjustments made in
finalising fair values primarily relate to the measurement of intangible
assets separately from goodwill, valuation of inventory and associated
deferred tax liabilities. The acquired goodwill is attributable
principally to the profit generating potential of the businesses, the
assembled workforce and benefits arising from embedded infrastructure
that are expected to be achieved from integrating the acquired
businesses into the Group's existing business. No amount of goodwill is
expected to be deductible for tax purposes.
As at September 24, 2019
As previously
reported in
Dec 31, 2019
financial Fair
statements Adjustments* value
------------- ------------ ---------
US$'000
---------------------------------------
Assets
Non-current assets
Property, plant and equipment 276 -- 276
Right of use assets 924 -- 924
Intangible Assets 308,374 (9,000) 299,374
Other assets 2,334 (433) 1,901
Total non-current assets 311,908 (9,433) 302,475
------------- ------------ ---------
Current assets
Cash and cash equivalents 24,985 -- 24,985
Trade and other receivables 23,259 -- 23,259
Inventory 45,959 11,482 57,441
Prepaid expenses and other assets 2,469 (881) 1,588
Total current assets 96,672 10,601 107,273
------------- ------------ ---------
Total assets 408,580 1,168 409,748
============= ============ =========
Current liabilities
Accounts payable 5,137 (1,186) 3,951
Accrued liabilities 64,088 2,922 67,010
Lease liabilities -- current 384 -- 384
Provision for legal settlements --
current 14,916 257 15,173
Total current liabilities 84,525 1,993 86,518
------------- ------------ ---------
Non-current liabilities
Lease liabilities - long term 538 -- 538
Long term debt 54,469 -- 54,469
Convertible notes debt and equity
components - long term 125,000 -- 125,000
Provision for legal settlements -
long term 7,821 -- 7,821
Deferred tax liability 14,425 (7,552) 6,873
Total non-current liabilities 202,253 (7,552) 194,701
------------- ------------ ---------
Total liabilities 286,778 (5,559) 281,219
------------- ------------ ---------
Total identifiable net assets at
fair value 121,802 6,727 128,529
------------- ------------ ---------
Goodwill arising on acquisition 30,813 (6,727) 24,086
Consideration 152,615 -- 152,615
------------- ------------ ---------
Consideration
Issue of fully paid up ordinary shares
and zero cost warrants 152,615 -- 152,615
Total consideration 152,615 -- 152,615
============= ============ =========
*Adjustments relate to finalization of fair values following completion
of the fair value assignment to identifiable assets and liabilities
acquired. See Note 15, Restatement of prior year comparatives, for more
details on the adjustments.
Contingent Value Rights
Related to the transaction, Amryt issued Contingent Value Rights
("CVRs") pursuant to which up to US$85,000,000 may become payable to
Amryt's shareholders and option holders, who were on the register prior
to the completion of the acquisition on September 20, 2019, if certain
approval and revenue milestones are met in relation FILSUVEZ(R), Amryt's
lead product candidate. If any such milestone is achieved, Amryt may
elect to pay the holders of CVRs by the issue of Amryt shares or loan
notes. If Amryt elects to issue Loan Notes to holders of CVRs, it will
settle such loan notes in cash 120 days after their issue. If none of
the milestones are achieved, scheme shareholders and option holders will
not receive any additional consideration under the terms of the CVRs. In
these circumstances, the value of each CVR would be zero.
The terms of the CVRs are as follows:
-- The total CVR payable is up to US$85,000,000
-- This is divided into three milestones which are related to the success of
FILSUVEZ(R) (the Group's lead development asset, currently in Phase 3
clinical trials)
-- FDA approval
-- US$35,000,000 upon FDA approval
-- 100% of the amount due if approval is obtained before December 31,
2021, with a sliding scale on a linear basis to zero if before
July 1, 2022
-- EMA approval
-- US$15,000,000 upon EMA approval
-- 100% of the amount due if approval is obtained before December 31,
2021, with a sliding scale on a linear basis to zero if before
July 1, 2022
-- Revenue targets
-- US$35,000,000 upon FILSUVEZ(R) revenues exceeding US$75,000,000 in
any 12-month period prior to June 30, 2024
-- Payment can, at the Board's discretion, be in the form of either:
-- 120-day loan notes (effectively cash), or
-- Shares valued using the 30 day / 45-day VWAP.
The CVRs were contingent on the successful completion of the acquisition
and, accordingly, have been based on fair value as at September 24,
2019. On consolidation, given that CVRs were issued to legacy Amryt
shareholders in their capacity as owners of the identified acquirer as
opposed to the seller in the transaction, management concluded that the
most appropriate classification would be to recognize the CVR as a
distribution on consolidation instead of goodwill.
Measurement of CVRs
As at September 30, 2020, the carrying value of the CVRs was
US$53,911,000 (December 31, 2019: US$49,413,000). The value of the
potential payout was calculated using the probability-weighted expected
returns method. Using this method, the potential payment amounts were
multiplied by the probability of achievement and discounted to present
value. The probability adjusted present values took into account
published orphan drug research data and statistics which were adjusted
by management to reflect the specific circumstances applicable to the
type of product acquired in the Amryt GmbH transaction. Discount rates
of 10% and 16.5% (December 31, 2019: 10% and 16.5%), as applicable, were
used in the calculation of the present value of the estimated
contractual cash flows for the nine months ended September 30, 2020.
Management was required to make certain estimates and assumptions in
relation to revenue forecasts, timing of revenues and probability of
achievement of commercialization of FILSUVEZ(R). However, management
notes that, due to issues outside their control (i.e. regulatory
requirements and the commercial success of the product), the timing of
when such revenue targets may occur may change. Such changes may have a
material impact on the expected cash flows of the CVRs.
Amryt reviews the expected cash flows on a regular basis as the discount
on initial recognition is being unwound as financing expenses in the
Consolidated Statement of Comprehensive Loss over the life of the
obligation. It is reviewed on a quarterly basis and the appropriate
finance charge is booked on a quarterly basis. The Group received
positive top-line data from the Phase 3 trial of FILSUVEZ(R) in
Epidermolysis Bullosa ("EB") in September, 2020. The Group expects
this to be followed by applications for approval from the FDA and the
EMA.
The total non-cash finance charge recognized in the Condensed
Consolidated Statement of Comprehensive Loss for the three and nine
months ended September 30, 2020 is US$1,557,000 and US$4,498,000 ,
respectively (September 30, 2019: US$nil and US$nil, respectively).
Acquisition of Amryt AG (previously "Birken")
Amryt DAC signed a conditional share purchase agreement to acquire Amryt
AG on October 16, 2015 ("Amryt AG SPA"). The Amryt AG SPA was
completed on April 18, 2016 with Amryt DAC acquiring the entire issued
share capital of Amryt GmbH. The consideration included contingent
consideration comprising milestone payments and sales royalties as
follows:
-- Milestone payments of:
-- EUR10,000,000 on receipt of first marketing approval by the EMA of
Episalvan, paid on the completion date (April 18, 2016);
-- Either (i) EUR5,000,000 once net ex-factory sales of Episalvan
have been at least EUR100,000 or (ii) if no commercial sales are
made within 24 months of EMA first marketing approval (being
January 14, 2016), EUR2,000,000 24 months after receipt of such
approval, which was paid in January 2018, and EUR3,000,000
following the first commercial sale;
-- EUR10,000,000 on receipt of marketing approval by the EMA or FDA
of a pharmaceutical product containing Betulin as its API for the
treatment of EB;
-- EUR10,000,000 once net ex-factory sales/net revenue in any
calendar year exceed EUR50,000,000;
-- EUR15,000,000 once net ex-factory sales/ net revenue in any
calendar year exceed EUR100,000,000;
-- Cash consideration of EUR150,000, due and paid on the completion date
(April 18, 2016); and
-- Royalties of 9% on sales of Episalvan products for 10 years from first
commercial sale;
Fair Value Measurement of Contingent Consideration
As of September 30, 2020, the fair value of the contingent consideration
was estimated to be US$63,880,000 (December 31, 2019: US$53,048,000).
The fair value of the royalty payments was determined using probability
weighted revenue forecasts and the fair value of the milestone payments
was determined using probability adjusted present values (see Note 14,
Fair value measurement and financial risk management, for fair value
hierarchy applied). The probability adjusted present values took into
account published orphan drug research data and statistics which were
adjusted by management to reflect the specific circumstances applicable
to the type of product acquired in the Amryt GmbH transaction. A
discount rate of 24.4% (December 31, 2019: 24.4%) was used in the
calculation of the fair value of the contingent consideration for the
nine months ended September 30, 2020. Management was required to make
certain estimates and assumptions in relation to revenue forecasts,
timing of revenues and probability of achievement of commercialization
of FILSUVEZ(R). However, management noted that due to issues outside
their control, the timing of when such revenue targets may occur may
change. Such changes may have a material impact on the assessment of the
fair value of the contingent consideration.
In January 2019, the Group received the results of an unblinded interim
efficacy analysis for the Phase 3 trial of FILSUVEZ(R) in EB. This
analysis was conducted by an independent data safety monitoring
committee and recommended that the trial should continue with an
increase of 48 patients in the study to a total of 230 evaluable
patients in order to be able to achieve 80% statistical power. In April
2020, given that the EASE study was already close to full enrollment,
the Group announced that it had taken advice from an independent expert
and concluded that the statistical impact of further patient recruitment
would most likely be negligible. Amryt therefore decided to close the
EASE study to further enrollment. The Group received positive top line
results from this trial in September, 2020, and the Group expects this
to be followed by applications for approval from the FDA and the EMA.
These factors have resulted in a change to the probability weighted
revenue forecasts and the probability of the adjusted present values
which are used in the calculation of the contingent consideration
balance and impact the amount being unwound to the consolidated
statement of comprehensive loss.
Amryt reviews the contingent consideration on a regular basis as the
probability adjusted fair values are being unwound as financing expenses
in the Consolidated Statement of Comprehensive Loss over the life of the
obligation. The finance charge is being unwound as a financing expense
in the Consolidated Statement of Comprehensive Loss on a quarterly
basis.
The total non-cash finance charge recognized in the Consolidated
Statement of Comprehensive Loss for the three and nine months ended
September 30, 2020 is US$2,126,000 and US$8,150,000, respectively
(September 30, 2019: US$1,448,000 and US$5,299,000, respectively).
6. Loss per share - basic and diluted
The weighted average number of shares in the loss per share ("LPS")
calculation, reflects the weighted average total actual shares of Amryt
Pharma plc in issue at September 30, 2020, as adjusted (see below).
Issued share capital - ordinary shares of GBP0.06 each
Weighted average
Number of shares shares
September 30, 2020 (unaudited) 162,728,640 155,776,507
September 30, 2019 (unaudited) 157,718,438 48,126,074
The calculation of loss per share is based on the following:
Three months ended Nine months ended
September 30, September 30,
--------------------------- -----------------------------
2020 2019 2020 2019
(unaudited) (unaudited) (unaudited) (unaudited)
------------- ------------ ------------- --------------
Loss after tax attributable to
equity holders of the Company
(US$'000) (10,471) (15,559) (57,537) (33,277)
Weighted average number of ordinary
shares in issue 158,303,972 55,683,096 155,776,507 48,126,074
Fully diluted average number
of ordinary shares in issue 158,303,972 55,683,096 155,776,507 48,126,074
------------ ----------- ------------ -----------
Basic and diluted loss per share
(US$) (0.07) (0.28) (0.37) (0.69)
============ =========== ============ ===========
The basic and diluted loss per share for the three and nine-month period
ended September 30, 2020 of US$0.07 and US$0.37, respectively (September
30, 2019: US$0.28 and US$0.69, respectively) was calculated using the
post consolidation number of ordinary shares in issue.
Where a loss has occurred, basic and diluted LPS are the same because
the outstanding share options and warrants are anti-dilutive.
Accordingly, diluted LPS equals the basic LPS. The share options and
warrants outstanding as at September 30, 2020 totalled 28,065,710
(September 30, 2019: 16,444,054) and are potentially dilutive.
7. Intangible assets and goodwill
The following table summarizes the Group's intangible assets and
goodwill:
Developed Developed
technology technology In process Other intangible Total intangible
- metreleptin - lomitapide R&D assets assets Goodwill
-------------- -------------- ---------------- ------------------ ---------------- ------------------
US$'000
----------------------------------------------------------------------------------------------------------
Cost
At January 1,
2019
(audited) -- -- 60,091 258 60,349 --
Additions -- -- -- 74 74 --
Acquired assets
as restated
(see note 15) 176,000 123,000 -- 374 299,374 24,086
Impairment charge -- -- (4,670) -- (4,670) --
Foreign exchange
movement -- -- (1,160) (5) (1,165) --
-------------- -------------- --------------- -------------- --------------- ----------------
At December
31, 2019 as
restated (see
note 15) 176,000 123,000 54,261 701 353,962 24,086
Additions -- -- -- 298 298 --
Disposals -- -- -- (246) (246) --
Foreign exchange
movement -- -- 2,456 36 2,492 --
----------------
At September
30, 2020 (unaudited) 176,000 123,000 56,717 789 356,506 24,086
============== ============== =============== ============== =============== ================
Accumulated amortization
At January 1,
2019
(audited) -- -- -- 52 52 --
Amortization
charge as restated
(see note 15) 7,314 4,143 -- 126 11,583 --
Foreign exchange
movement -- -- -- -- -- --
-------------- -------------- --------------- -------------- --------------- ----------------
At December
31, 2019 as
restated (see
note 15) 7,314 4,143 -- 178 11,635 --
Amortization
charge 20,571 11,653 -- 176 32,400 --
Amortization
charge on disposals -- -- -- (246) (246)
Foreign exchange
movement -- -- -- 13 13 --
-------------- -------------- --------------- -------------- --------------- ----------------
At September
30, 2020 (unaudited) 27,885 15,796 -- 121 43,802 --
============== ============== =============== ============== =============== ================
Net book value
At December
31, 2019 as
restated (see
note 15) 168,686 118,857 54,261 523 342,327 24,086
============== ============== =============== ============== =============== ================
At September
30, 2020 (unaudited) 148,115 107,204 56,717 668 312,704 24,086
============== ============== =============== ============== =============== ================
Developed technology on commercially marketed products
In connection with the acquisition of Aegerion in September 2019, the
Group acquired developed technology, metreleptin and lomitapide. These
intangible assets are amortized over their estimated useful lives and
the remaining useful lives for metreleptin and lomitapide are
approximately 5.4 and 6.9 years, respectively, as of September 30, 2020.
In-process R&D
As a result of the acquisition of Amryt GmbH, in 2016, the Group
recognized in-process R&D costs of US$54,268,000 which is related to the
Group's lead development asset, FILSUVEZ(R).
Goodwill
During 2019, the Group completed the acquisition of Aegerion. The
acquisition resulted in aggregate goodwill of US$24,086,000, as
restated.
The Group reviews events or changes in circumstances that may indicate a
triggering event for impairment. As of September 30, 2020 the Group
didn't identify any events or changes in circumstances causing any
impairment triggers. In applying its judgement in reviewing potential
events or changes in circumstances resulting in impairment triggers,
amongst other considerations, Management considered the impact of
COVID-19 and noted that the Group has seen little impact on the business
to date. As such there was no impairment charge recorded during the
three and nine months ended September 30, 2020.
8. Trade and other receivables
As at
-------------------------------
December 31,
September 30, 2019
2020 restated
(unaudited) (see note 15)
------------- ----------------
US$'000
-------------------------------
Trade receivables 32,403 28,607
Accrued income and other debtors 8,988 5,493
VAT recoverable 804 1,400
------------- --------------
Trade and other receivables 42,195 35,500
============= ==============
9. Cash and cash equivalents
As at
-----------------------------
September 30, December 31,
2020 2019
(unaudited) (audited)
------------- --------------
US$'000
-----------------------------
Cash at bank available on demand 74,590 65,197
Restricted cash 792 2,032
------------- ------------
Total cash and cash equivalents 75,382 67,229
============= ============
Cash and cash equivalents include cash at bank available on demand and
restricted cash.
At September 30, 2020 and December 31, 2019, there was US$792,000 and
US$2,032,000 of restricted cash, respectively. The balance at September
30, 2020 includes a deposit on a company credit card facility for an
amount of US$151,000. Of the US$2,032,000 held in restricted cash at
December 31, 2019, $1,219,000 was in an escrow account, which was set-up
in accordance with Aegerion's bankruptcy plan as approved by the U.S.
Bankruptcy Court, and it was fully utilized to pay the costs associated
with the bankruptcy process. Additionally, there was US$641,000 held by
a third-party distributor at September 30, 2020 (December 31, 2019:
US$813,000).
10. Share capital and reserves
Details of issued ordinary shares with a nominal value of Sterling 6
pence (2019: 1 pence) each are in the table below.
Number of Total Share Total Share
ordinary Capital Premium
Date shares US$'000 US$'000
-------------- ----------------
At September 30, 2020
(unaudited) 167,593,296 12,548 16,553
At December 31, 2019
(audited) 159,363,543 11,918 2,422
The number of ordinary shares issued at September 30, 2020 and December
31, 2019 includes treasury shares of 4,864,656.
Share Capital
Share capital represents the cumulative par value arising upon issue of
ordinary shares of Sterling 6 pence each.
The ordinary shares have the right to receive notice of, attend and vote
at general meetings and participate in the profits of the Company.
Share Premium
Share premium represents the consideration that has been received in
excess of the nominal value on issue of share capital net of issue costs
and transfers to distributable reserves.
Warrant reserve
The warrant reserve represents zero cost warrants issued as part of the
equity raise on September 24, 2019 net of issue costs apportioned to
warrants issued and zero cost additional warrants issued to certain
shareholders on November 14, 2019. Each warrant entitles the holder to
subscribe for one ordinary share at zero cost. On July 15, 2020 and
September 22, 2020, the Company issued 4,000,000 and 4,229,753 ordinary
shares in consideration for certain warrants.
Treasury Shares
On November 14, 2019, the Company repurchased a combined 4,864,656
ordinary shares from certain shareholders. In exchange for the ordinary
shares, these shareholders were issued an equivalent number of zero cost
warrants. These ordinary shares are now held as treasury shares.
Share based payment reserve
Share based payment reserve relates to the charge for share based
payments in accordance with IFRS 2.
Merger reserve
The merger reserve was created on the acquisition of Amryt DAC by Amryt
Pharma plc in April 2016. Ordinary shares in Amryt Pharma plc were
issued to acquire the entire issued share capital of Amryt DAC. Under
section 612 of the UK Companies Act 2006, the premium on these shares
has been included in a merger reserve.
Reverse acquisition reserve
The reverse acquisition reserve arose during the period ended December
31, 2016 in respect of the reverse acquisition of Amryt Pharma plc by
Amryt DAC. Since the shareholders of Amryt DAC became the majority
shareholders of the enlarged Group, the acquisition is accounted for as
though there is a continuation of Amryt DAC's financial statements. The
reverse acquisition reserve is created to maintain the equity structure
of Amryt Pharma plc in compliance with UK company law.
Equity component of convertible notes
The equity component of convertible notes represents the equity
component of the US$125,000,000 convertible debt, that was issued on
September 24, 2019, and is measured by determining the residual of the
fair value of the instrument less the estimated fair value of the
liability component. The equity component is recognized in equity and is
not subsequently remeasured.
Other distributable reserves
Other distributable reserves comprise the following:
-- Distribution of the share premium amount on November 6, 2019 of
US$268,505,000.
-- A deemed distribution of US$47,902,000 arising from the issuance of CVRs.
-- A deemed distribution of US$2,969,000 arising from the scheme of
arrangement in September 2019 whereby Amryt Pharma plc, which was
incorporated in July 2019, became a 100% shareholder of Amryt Pharma
Holdings Limited (formerly named Amryt Pharma plc) (the "Acquisition of
subsidiary without a change of control").
Currency translation reserve
The currency translation reserve arises on the retranslation of non-U.S,
dollar denominated foreign subsidiaries.
Accumulated deficit
Accumulated deficit represents losses accumulated in previous periods
and the current year.
11. Long term loan
As at
---------------------------------------------------------------
September 30, December 31,
2020 2019
(unaudited) (audited)
------------- --------------
US$'000
-----------------------------
Long term loan 86,603 82,456
Unamortized debt issuance costs (768) (846)
------------ -----------
Long term loan 85,835 81,610
============ ===========
As part of the acquisition of Aegerion on September 24, 2019, Aegerion
entered into a new U.S. dollar denominated US$81,021,000 secured term
loan debt facility ("Term Loan") with various lenders. The Term Loan
is made up of a US$54,469,000 loan that was in place prior to the
acquisition which was refinanced as part of the acquisition and a
US$26,552,000 additional loan that was drawn down on September 24, 2019.
The Term Loan has a five-year term from the date of the draw down,
September 24, 2019 and matures on September 24, 2024. Under the Term
Loan, interest will be payable at the option of the Group at the rate of
11% per annum paid in cash on a quarterly basis or at a rate of 6.5%
paid in cash plus 6.5% paid in kind that will be paid when the principal
is repaid, which rolls up and is included in the principal balance
outstanding, on a quarterly basis. The Term Loan may be prepaid, in
whole or in part, by Aegerion at any time subject to payment of an exit
fee, which depending on the stage of the loan term, ranges from 5.00% to
0.00% of the principal then outstanding on the Term Loan.
The Term Loan is guaranteed by Amryt and certain subsidiaries of the
Group. In connection with the loan agreement, fixed and floating charges
have been placed on property and undertakings of Amryt and certain
subsidiaries of the Group.
The Term Loan agreement includes affirmative and negative covenants,
including prohibitions on the incurrence of additional indebtedness,
granting of liens, certain asset dispositions, investments and
restricted payments, in each case, subject to certain exceptions set
forth in the Loan Agreement. The Term Loan agreement also includes
customary events of default for a transaction of this type, and includes
(i) a cross-default to the occurrence of any event of default under
material indebtedness of Aegerion and certain subsidiaries of the Group
and Amryt, including the convertible notes, and (ii) Amryt or any of its
subsidiaries being subject to bankruptcy or other insolvency
proceedings. Upon the occurrence of an event of default, the lenders may
declare all of the outstanding Term Loan and other obligations under the
Term Loan agreement to be immediately due and payable and exercise all
rights and remedies available to the lenders under the Term Loan
agreement and related documentation. There have been no events of
default or breaches of the covenants occurring for the nine months ended
September 30, 2020 and for year ended December 31, 2019.
12. Convertible notes
As at
----------------------------------
September 30, December 31,
2020 2019
(unaudited) (audited)
------------- -------------------
US$'000
----------------------------------
Issuance of convertible notes 125,000 125,000
Amount classified as equity (29,210) (29,210)
Accreted interest 4,196 1,066
------------ ----------------
Total convertible notes 99,986 96,856
============ ================
As part of the acquisition, Aegerion issued convertible notes with an
aggregate principal amount of US$125,000,000 to Aegerion creditors.
The convertible notes are senior unsecured obligations and bear interest
at a rate of 5.0% per year, payable semi-annually in arrears on April 1
and October 1 of each year, beginning on April 1, 2020. The convertible
notes will mature on April 1, 2025, unless earlier repurchased or
converted.
The convertible notes are convertible into Amryt's ordinary shares at a
conversion rate of 386.75 ordinary shares per US$1,000 principal amount
of the convertible notes. If the holders elect to convert the
convertible notes, Aegerion can settle the conversion of the convertible
notes through payment or delivery of cash, common shares, or a
combination of cash and common shares, at its discretion. As a result of
the conversion feature in the convertible notes, the convertible notes
were assessed to have both a debt and an equity component. The two
components were assessed separately and classified as a financial
liability and equity instrument. The financial liability component was
measured at fair value based on the discounted cash flows expected over
the expected term of the notes using a discount rate based on a market
interest rate that a similar debt instrument without a conversion
feature would be subject to. Refer to Note 10, Share capital and
reserves, for further details on the equity component of the convertible
notes.
From September 24, 2019 until the close of business on the second
scheduled trading day immediately preceding the maturity date, holders
may convert all or any portion of their convertible notes, in multiples
of US$1,000 principal amount, at the option of the holder.
The indenture does not contain any financial covenants and does not
restrict the Group's ability to repurchase securities, pay dividends or
make restricted payments in the event of a transaction that
substantially increases the Group's level of indebtedness in certain
circumstances.
The indenture contains customary terms and covenants and events of
default. If an event of default (other than certain events of bankruptcy,
insolvency or reorganization involving Aegerion, Amryt and certain
subsidiaries of the Group) occurs and is continuing, the trustee by
notice to Aegerion, or the holders of at least 25% in principal amount
of the outstanding convertible notes by written notice to Aegerion and
the trustee, may declare 100% of the principal of and accrued and unpaid
interest, if any, on all of the convertible notes to be due and payable.
Upon such a declaration of acceleration, such principal and accrued and
unpaid interest, if any, will be due and payable immediately. Upon the
occurrence of certain events of bankruptcy, insolvency or reorganization
involving Aegerion, 100% of the principal and accrued and unpaid
interest, if any, on the convertible notes will become due and payable
automatically. Notwithstanding the foregoing, the indenture provides
that, upon Aegerion's election, and for up to 180 days, the sole remedy
for an event of default relating to certain failures by Aegerion to
comply with certain reporting covenants in the indenture consists
exclusively of the right to receive additional interest on the
convertible notes. There have been no events of default or breaches of
the covenants occurring for the nine months ended September 30, 2020 and
for year ended December 31, 2019.
13. Provisions and other liabilities
As at
-------------------------------
December 31,
September 30, 2019
2020 restated
(unaudited) (see note 15)
------------- ----------------
US$'000
-------------------------------
Non-current liabilities
Provisions and other liabilities -- 3,910
Leases due greater than 1 year 4,657 1,053
------------- --------------
4,657 4,963
------------- --------------
Current liabilities
Provisions and other liabilities 13,887 23,304
Leases due less than 1 year 822 571
------------- --------------
14,709 23,875
------------- --------------
Total provisions and other liabilities 19,366 28,838
============= ==============
Legal matters
Prior to the acquisition of Aegerion by Amryt, Aegerion entered into
settlement agreements with governmental entities including the
Department of Justice ("DOJ") and the FDA in connection with JUXTAPID
investigations. The settlement agreements require Aegerion to pay
specified fines and engage in regulatory compliance efforts. The
settlements that remain due as a current liability and a non-current
liability is US$7,887,000 and US$nil, respectively, as of September 30,
2020 (December 31, 2019: US$15,547,000 and US$3,910,000, respectively).
Other legal matters
The Group recognizes a liability for legal contingencies when it
believes that it is both probable that a liability has been incurred and
that it can reasonably estimate the amount of the loss. The Group
reviews these accruals and adjusts them to reflect ongoing negotiations,
settlements, rulings, advice of legal counsel and other relevant
information. To the extent new information is obtained and the Group's
views on the probable outcomes of claims, suits, assessments,
investigations or legal proceedings change, changes in the Group's
liability accrual would be recorded in the period in which such
determination is made. At September 30, 2020 and December 31, 2019, the
Group had recognized liabilities of US$6,000,000 and US$7,757,000,
respectively, in relation to ongoing legal matters.
14. Fair value measurement and financial risk management
Categories of financial instruments
As at
------------------------------------
December 31,
September 30, 2019
2020 restated
(unaudited) (see note 15)
------------- --------------------
US$'000
------------------------------------
Financial assets (all at amortized
cost):
Cash and cash equivalents 75,382 67,229
Trade receivables 32,403 28,607
------------- -----------------
Total financial assets 107,785 95,836
Financial liabilities:
At amortized cost
Trade payables and accrued
expenses 99,483 77,556
Lease liabilities 5,479 1,624
Other liabilities 7,887 19,457
Convertible notes 99,986 96,856
Long term loan 85,835 81,610
Contingent value rights 53,911 49,413
At fair value
Contingent consideration 63,880 53,048
Total financial liabilities 416,461 379,564
Net (308,676 ) (283,728)
============= =================
Financial instruments evaluated at fair value can be classified
according to the following valuation hierarchy, which reflects the
extent to which the fair value is observable:
-- Level 1: fair value evaluations using prices listed on
active markets (not adjusted) of identical assets or liabilities.
-- Level 2: fair value evaluations using input data for the
asset or liability that are either directly observable (as prices) or
indirectly observable (derived from prices), but which do not constitute
listed prices pursuant to Level 1.
-- Level 3: fair value evaluations using input data for the
asset or liability that are not based on observable market data
(unobservable input data).
The contingent consideration has been valued using Level 3. The
contingent consideration comprises:
--Contingent consideration relating to the acquisition of Amryt GmbH
(see Note 5, Business combinations and asset acquisitions) that was
measured at US$63,880,000 as at September 30, 2020 (December 31, 2019:
US$53,048,000). The fair value comprises royalty payments which was
determined using probability weighted revenue forecasts and the fair
value of the milestones payments which was determined using probability
adjusted present values.
Impact of key unobservable input data:
-- An increase of 10% in estimated revenue forecasts would
result in an increase to the fair value of US$4,484,000. A decrease
would have the opposite effect.
-- A 5% increase in the discount factor used would result in a
decrease to the fair value of US$ 10,434,000. A decrease of 5% would
result in an increase to the fair value of US$13,935,000.
-- A six-month delay in the launch date for FILSUVEZ(R) for EB
would result in a decrease to the fair value of US$5,783,000.
15. Restatement of prior year comparatives
As described in Note 5, Business combinations and asset acquisitions,
the fair values of the assets and liabilities of the Aegerion Group were
finalized in September 2020. IFRS 3 requires fair value adjustments to
be recorded with effect from the date of acquisition and consequently
result in the restatement of previously reported financial results. The
impact on the statement of financial position as at December 31, 2019 is
shown below:
As previously As
reported Adjustments Note restated
--------------- ------------- ---- --------
US$'000
Assets
Non-current assets
Goodwill 30,813 (6,727) 15a 24,086
Intangible assets - net 350,953 (8,626) 15b 342,327
Property, plant and equipment 3,036 -- 3,036
Other non-current assets 2,306 (433) 15c 1,873
Total non-current assets 387,108 (15,786) 371,322
---------- --- -------- --------
Current assets
Trade and other receivables 36,387 (887) 15c 35,500
Inventories 43,623 14,377 15d 58,000
Cash and cash equivalents, including
restricted cash 67,229 -- 67,229
Total current assets 147,239 13,490 160,729
Total assets 534,347 (2,296) 532,051
========== === ======== ========
Equity and liabilities
Equity attributable to owners of the
parent
Share capital 11,918 -- 11,918
Share premium 2,422 -- 2,422
Other reserves 248,656 (26) 248,630
Accumulated deficit (133,674) 2,537 (131,137)
Total equity 129,322 2,511 131,833
---------- --- -------- --- --------
Non-current liabilities
Contingent consideration and contingent
value rights 102,461 -- 102,461
Deferred tax liability 18,921 (6,819) 15e 12,102
Long term loan 81,610 -- 81,610
Convertible notes 96,856 -- 96,856
Provisions and other liabilities 4,963 -- 4,963
Total non-current liabilities 304,811 (6,819) 297,992
---------- --- -------- --------
Current liabilities
Trade and other payables 76,596 1,755 15c 78,351
Provisions and other liabilities 23,618 257 15c 23,875
Total current liabilities 100,214 2,012 102,226
Total liabilities 405,025 (4,807) 400,218
---------- --- -------- --------
Total equity and liabilities 534,347 (2,296) 532,051
========== ======== ========
The above adjustments to the statement of financial position relate to
the completion of the fair value assignment to identifiable assets and
liabilities acquired as part of the Aegerion acquisition, the following
adjustments have been reflected in the condensed consolidated financial
statements:
1. The adjustments to goodwill are a consequence of the fair value
adjustments described in more detail below, which primarily relate to the
measurement of intangible assets, valuation of inventory and associated
deferred tax liabilities.
2. The fair value of intangible assets acquired, consisting of developed
technology for metreleptin and lomitapide, was adjusted as a consequence
of the detailed review and update to the expected future usage of
inventory, the valuation of which was a factor in determining the fair
value of acquired developed technology. See more detail on the update to
the inventory valuation below.
3. Accruals, provisions, and prepayments as at the acquisition date were
reviewed during the twelve months following the acquisition and the fair
values as at the acquisition date were updated based on the results of a
review of the conditions that existed at this date.
4. Fair value of inventory recognized at the date of acquisition was updated
to reflect the results of detailed reviews of both raw material and
finished good acquired. This involved a review the expected timing of
transition from usage of acquired finished goods to usage of new
inventory, including the review of expected timing of manufacture runs
and the review of expected inventory usage. Additionally, a review was
conducted on the demand and production that would be saleable in the
future. The review resulted in a change in the assumptions and estimates
regarding the usage of acquired inventory, leading to an increase in the
estimated usage of acquired inventory and consequently resulting in an
increase in the fair value of acquired inventory.
5. Deferred tax was updated to reflect the above changes to the fair value
of the inventory and of intangible assets. In addition, deferred tax was
updated to reflect the results of a review of the historic tax basis of
US intangible assets included in the Aegerion acquisition. This review
identified that the tax basis of the asset in question was understated at
the time of the acquisition. The closing deferred tax liability as of
December 31, 2019 was adjusted for the correct tax basis.
As noted above, IFRS 3 requires fair value adjustments to be recorded as
if the accounting for the business combination had been completed at the
acquisition date. Consequently, the comparative information for prior
periods presented in financial statements were revised, including
changes in inventory fair value step-up amortization, intangible
amortization and deferred tax effects recognized in completing the
acquisition accounting. The impact on the income statement of the fair
value adjustments for the year ended December 31, 2019 is shown below:
Year ended December 31, 2019
------------------------------------------------
As previously As
reported Adjustments* Note restated
--------------- -------------- ---- --------
US$'000
-----------------------------------------------
Revenue 58,124 58,124
Cost of sales (42,001) 3,268 15f (38,733 )
--------- ------- --------
Gross profit 16,123 3,268 19,391
Research and development expenses (15,827) (15,827 )
Selling, general and administrative
expenses (35,498) (35,498 )
Restructuring and acquisition costs (13,038) (13,038 )
Share based payment expenses (841) (841 )
Impairment charge (4,670) (4,670 )
Operating loss before finance expense (53,751) 3,268 (50,483 )
--------- --- ------- ----- --------
Non-cash change in fair value of contingent
consideration (6,740) (6,740 )
Non-cash contingent value rights finance
expense (1,511) (1,511 )
Net finance expense -- other (4,759) (4,759 )
--------- --------
Loss on ordinary activities before
taxation (66,761) 3,268 (63,493 )
--------- ------- --------
Tax credit/(charge) on loss on ordinary
activities 1,226 (731 ) 15g 495
Loss for the year attributable to the
equity holders of the Company (65,535) 2,537 (62,998 )
========= === ======= ===== ========
Exchange translation differences which
may be reclassified through profit
or loss 781 (26 ) 755
--------- ------- --------
Total other comprehensive profit/(loss) 781 (26 ) 755
Total comprehensive loss for the year
attributable to the equity holders
of the Company (64,754) 2,511 (62,243 )
========= === ======= ===== ========
Loss per share
Loss per share - basic and diluted,
attributable to ordinary equity holders
of the parent (US$) (0.86) (0.83 )
========= === ========
The above adjustments relate to the impact on the statement of
comprehensive loss as result of the fair value adjustments following the
completion of the fair value assignment to identifiable assets and
liabilities acquired as part of the Aegerion acquisition.
Non-cash adjustments to the statement of comprehensive loss:
1. Cost of sales has been adjusted for the impact on the non-cash
amortization of inventory fair value step-up and acquired intangibles,
for the period from the date of acquisition to the year end, as a result
of the update to acquired inventory and intangible fair values following
the finalization of acquisition accounting for the Aegerion acquisition.
See Note 15b and 15d, above, for further detail on the fair value
adjustments to acquired inventory and intangible.
2. As a result of a change in the measurement of the deferred tax liability
at the acquisition date, there was a non-cash adjustment to the tax
charge for the period from the date of acquisition to the year end.
16. Events after the reporting period
COVID-19
Since a novel strain of coronavirus (SARS-CoV-2) causing a disease
referred to as COVID-19 was first reported in December 2019, the disease
has spread across the world, including countries in which we have
patients and in which we have planned or active clinical trial sites.
The outbreak and government measures taken in response have had a
significant impact, both direct and indirect, on all businesses and
commerce as supply chains have been disrupted, facilities and production
have been suspended and demand for certain goods and services has spiked
while demand for other goods and services has fallen. As COVID-19
continues to spread around the globe, Amryt may experience disruptions
that could affect its business, preclinical studies and clinical trials.
In response to the spread of COVID-19, Amryt has closed its executive
offices with its administrative employees continuing their work outside
of our offices and limited the number of staff in Amryt's manufacturing
facility in Germany. Amryt provides therapeutic products to HoFH and
lipodystrophy patients globally on a recurring basis. Once lomitapide
(for the treatment of HoFH) or metreleptin (for the treatment of
lipodystrophy) is prescribed by physicians, patients are typically on
treatment over a long period of time with repeat prescriptions for each
patient.
Exercise of share options
On October 1, 2020, the Company announced that the Company has issued
72,953 ordinary shares of GBP0.06 each ("Ordinary Shares") from treasury
following the exercise of options by a former employee.
(END) Dow Jones Newswires
November 05, 2020 07:00 ET (12:00 GMT)
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Amryt Pharma (LSE:AMYT)
Gráfico Histórico do Ativo
De Fev 2025 até Mar 2025
Amryt Pharma (LSE:AMYT)
Gráfico Histórico do Ativo
De Mar 2024 até Mar 2025
