Delaware | 001-34962 | 20-5300780 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
5858 Horton Street, Ste. 455, Emeryville, CA | 94608 | |
(Address of Principal Executive Offices) | (Zip Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | Results of Operations and Financial Condition. |
Item 9.01 | Financial Statements and Exhibits. |
Exhibit No. | Description | |
ZOGENIX, INC. | ||||||
Date: March 6, 2018 | By: | /s/ Michael P. Smith | ||||
Name: | Michael P. Smith | |||||
Title: | Executive Vice President, Chief Financial Officer, Treasurer and Secretary |
Exhibit No. | Description | |
99.1 | Press Release, dated March 6, 2018 | |
• | ZX008 Granted Breakthrough Therapy Designation in Dravet syndrome by FDA |
• | Last patient randomized into second Phase 3 clinical trial of ZX008 in patients with Dravet syndrome, Study 1504 |
• | Initiated global Phase 3 clinical trial for ZX008 in Lennox-Gastaut syndrome |
• | Breakthrough Therapy Designation granted by FDA for ZX008 in Dravet syndrome |
• | Completed enrollment of Study 1504; expect top-line results in late second quarter |
• | Initiated global Phase 3 clinical trial of ZX008 in children and adults with Lennox-Gastaut syndrome |
• | Presented additional efficacy and safety results from Study 1 at the 71st American Epilepsy Society Annual Meeting. The new Study 1 results presented showed the odds of achieving a clinically meaningful (≥50%) or substantial (≥75%) reduction in convulsive seizure frequency were 29 and 50 times higher, respectively, in patients treated with ZX008 0.8 mg/kg/day as compared to patients treated with placebo. Additionally, 55% of patients treated with ZX008 0.8 mg/kg/day were rated by parents/caregivers as very much improved or much improved in overall condition on the Clinical Global Impression (CGI-C) rating scale compared to 10% of the placebo group (p=0.001) and 62.5% |
◦ | 11 additional posters supporting the ongoing open-label trials of ZX008 in refractory epilepsies, and the burden of these conditions, were also presented |
• | Completed year ended December 31, 2017, with $293.5 million in cash and cash equivalents |
• | Due to the wind-down of Sumavel DosePro manufacturing operations, the Company recorded no revenue for the three months ended December 31, 2017. This compares with total revenue of $11.0 million in the fourth quarter ended December 31, 2016, consisting entirely of contract manufacturing revenue for Sumavel DosePro. |
• | Research and development expenses for the fourth quarter ended December 31, 2017, totaled $18.1 million, up from $13.4 million in the fourth quarter ended December 31, 2016, as the Company continued enrollment and expanded the scope of its Phase 3 clinical trials for ZX008 in Dravet syndrome and initiated its global Phase 3 study in LGS. |
• | Selling, general and administrative expenses for the fourth quarter ended December 31, 2017, totaled $7.8 million, compared with $7.5 million in the fourth quarter ended December 31, 2016. |
• | Net loss from continuing operations for the fourth quarter ended December 31, 2017, was $39.8 million, compared with a net loss of $23.6 million in the fourth quarter ended December 31, 2016. |
• | Total net loss for the fourth quarter ended December 31, 2017, was $39.7 million, or $1.17 per share, compared with a net loss of $23.5 million, or $0.95 per share, in the fourth quarter ended December 31, 2016. |
• | Total revenue for the year ended December 31, 2017, was $9.8 million, consisting entirely of contract manufacturing revenue for Sumavel DosePro. This compared with total revenue of $28.9 million in the year ended December 31, 2016, substantially all of which was derived from contract manufacturing revenue for Sumavel DosePro. The decrease was primarily attributable to lower reimbursed production costs under the agreement with Endo. In April 2017, Zogenix completed fulfillment of the remaining open orders and ceased all manufacturing activities related to Sumavel DosePro. |
• | Research and development expenses for the year ended December 31, 2017, totaled $67.4 million, up from $41.8 million in the year ended December 31, 2016, and was primarily attributable to the progression and expansion of the Company’s clinical trial activities related to its Phase 3 development program for ZX008 in Dravet syndrome and LGS. |
• | Selling, general and administrative expenses for the year ended December 31, 2017, totaled $25.9 million, compared with $27.0 million in the year ended December 31, 2016. |
• | Net loss from continuing operations for the year ended December 31, 2017, was $126.0 million, compared with $68.7 million in the year ended December 31, 2016. |
• | Net loss from discontinued operations for the year ended December 31, 2017, was $0.8 million, compared with $1.0 million in the year ended December 31, 2016. |
• | Total net loss for the year ended December 31, 2017 was $126.8 million, or $4.65 per share, compared with a net loss of $69.7 million, or $2.81 per share, in the year ended December 31, 2016. |
• | At December 31, 2017, the Company had cash and cash equivalents of $293.5 million, compared to $91.6 million at December 31, 2016. In October 2017, Zogenix closed on an underwritten common stock offering in which the Company issued and sold 7,705,000 shares of common stock at a price of $37.50 per share and received net proceeds of approximately $271.3 million. |
December 31, | |||||||
2017 | 2016 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 293,503 | $ | 91,551 | |||
Trade accounts receivable | — | 12,577 | |||||
Inventory | — | 7,047 | |||||
Prepaid expenses | 5,994 | 7,404 | |||||
Other current assets | 5,206 | 1,335 | |||||
Total current assets | 304,703 | 119,914 | |||||
Property and equipment, net | 245 | 1,710 | |||||
Indefinite-lived intangible asset | 102,500 | 102,500 | |||||
Goodwill | 6,234 | 6,234 | |||||
Other assets | 3,931 | 1,147 | |||||
Total assets | $ | 417,613 | $ | 231,505 | |||
Liabilities and stockholders’ equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 3,356 | $ | 4,549 | |||
Accrued expenses | 10,499 | 6,374 | |||||
Common stock warrant liabilities | 512 | 809 | |||||
Accrued compensation | 6,616 | 3,652 | |||||
Working capital advance note payable, net of discount | — | 3,267 | |||||
Deferred revenue | — | 1,245 | |||||
Current liabilities of discontinued operations | — | 414 | |||||
Total current liabilities | 20,983 | 20,310 | |||||
Long-term debt | — | 18,824 | |||||
Contingent consideration | 76,900 | 52,800 | |||||
Deferred tax liability | 17,425 | 17,425 | |||||
Other long-term liabilities | 784 | 1,390 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Common stock | 35 | 25 | |||||
Additional paid-in capital | 873,526 | 565,954 | |||||
Accumulated deficit | (572,040 | ) | (445,223 | ) | |||
Total stockholders’ equity | 301,521 | 120,756 | |||||
Total liabilities and stockholders’ equity | $ | 417,613 | $ | 231,505 |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenue: | |||||||||||||||
Contract manufacturing revenue | $ | — | $ | 10,988 | $ | 9,821 | $ | 28,525 | |||||||
Service and other product revenue | — | (2 | ) | — | 325 | ||||||||||
Total revenue | — | 10,986 | 9,821 | 28,850 | |||||||||||
Operating expenses (income): | |||||||||||||||
Cost of contract manufacturing | — | 5,988 | 10,729 | 22,468 | |||||||||||
Research and development | 18,080 | 13,393 | 67,449 | 41,840 | |||||||||||
Selling, general and administrative | 7,756 | 7,491 | 25,885 | 26,996 | |||||||||||
Loss on contract termination | — | — | 478 | — | |||||||||||
Change in fair value of contingent consideration | 12,500 | (1,000 | ) | 24,100 | 1,800 | ||||||||||
Asset impairment charges | — | 8,431 | 1,116 | 8,431 | |||||||||||
Total operating expenses | 38,336 | 34,303 | 129,757 | 101,535 | |||||||||||
Loss from operations | (38,336 | ) | (23,317 | ) | (119,936 | ) | (72,685 | ) | |||||||
Other income (expense): | |||||||||||||||
Interest income | 758 | 81 | 1,090 | 443 | |||||||||||
Interest expense | (579 | ) | (675 | ) | (2,644 | ) | (2,825 | ) | |||||||
Loss on extinguishment of debt | (1,498 | ) | — | (4,876 | ) | — | |||||||||
Change in fair value of warrant liabilities | (63 | ) | 239 | 297 | 5,387 | ||||||||||
Other income (expense) | (24 | ) | 45 | 47 | 46 | ||||||||||
Total other (expense) income | (1,406 | ) | (310 | ) | (6,086 | ) | 3,051 | ||||||||
Net loss from continuing operations before income taxes | (39,742 | ) | (23,627 | ) | (126,022 | ) | (69,634 | ) | |||||||
Income tax (expense) benefit | (41 | ) | 25 | — | 948 | ||||||||||
Net loss from continuing operations | (39,783 | ) | (23,602 | ) | (126,022 | ) | (68,686 | ) | |||||||
Net income (loss) from discontinued operations, net of taxes | 75 | 109 | (795 | ) | (1,021 | ) | |||||||||
Net (loss) income | $ | (39,708 | ) | $ | (23,493 | ) | $ | (126,817 | ) | $ | (69,707 | ) | |||
Net (loss) income per share, basic and diluted | $ | (1.17 | ) | $ | (0.95 | ) | $ | (4.65 | ) | $ | (2.81 | ) | |||
Weighted average shares outstanding, basic and diluted | 34,057 | 24,799 | 27,301 | 24,785 |