GW Pharmaceuticals plc Reports Fourth Quarter and Year-End 2016 Financial Results and Operational Progress

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Dec 5, 2016

- Three Positive Phase 3 Epidiolex clinical trials reported in 2016 -
- NDA submission and launch preparation on track -
- Conference call today at 8:00 a.m. EST -

LONDON, Dec. 05, 2016 (GLOBE NEWSWIRE) -- GW Pharmaceuticals plc (NASDAQ:GWPH) (GW, the Company or the Group), a biopharmaceutical company focused on discovering, developing and commercializing novel therapeutics from its proprietary cannabinoid product platform, announced financial results for the fourth quarter and year-ended 30 September 2016.

"In 2016 GW has completed three positive Phase 3 trials for Epidiolex in patients with two different rare treatment resistant forms of childhood-onset epilepsy and we are making good progress towards an NDA submission. Our sights are now focused on Epidiolex approval and accelerating our preparations for a highly successful launch," stated Justin Gover, GW's Chief Executive Officer. "Our goal is to provide the children and their families suffering from these highly treatment-resistant forms of childhood-onset epilepsy with a much needed new prescription option as quickly as possible."

2016 OPERATIONAL HIGHLIGHTS

  • Epidiolex® (CBD) orphan epilepsy program in Dravet syndrome, Lennox-Gastaut Syndrome (LGS), Tuberous Sclerosis Complex (TSC) and infantile spasms (IS)
    • Phase 3 trials:
      • Positive results in a pivotal Phase 3 Dravet syndrome trial
      • Positive results in two pivotal Phase 3 LGS trials
      • Positive data presented at the American Epilepsy Society Annual Meeting
    • Regulatory:
      • Positive Dravet syndrome pre-NDA meeting held with FDA in July 2016
      • Positive CMC pre-NDA meeting held with FDA in November 2016
      • NDA submission for both Dravet and LGS indications expected at end of H1 2017, just 3 years since opening of IND
      • Preparations advancing for EU regulatory submission in H2 2017
    • Manufacturing scale-up:
      • Manufacturing scale-up on track to deliver significant commercial launch inventory
    • Expanded access program and open label extension:
      • 98% of patients who complete Phase 3 trials have entered long term extension
      • Over 1,000 patients now on Epidiolex treatment
      • NDA submission to include safey data from over 1,500 patients and over 400 patients with 1 year or more continuous exposure
      • Withdrawal rate in long term studies approx 20%
    • Commercial:
      • US commercial team build underway and pre-launch preparations advancing well
      • EU commercial team now being established
    • Additional indications:
      • Phase 3 trial in TSC ongoing
      • Two part Phase 3 trial in IS commenced in December 2016
    • Intellectual Property:
      • Patent portfolio being prosecuted with claims directed to the use of CBD in the treatment of epilepsy seizure subtypes and epilepsy syndromes

  • Advanced clinical programs in multiple cannabinoid pipeline product candidates:
    • CBDV Phase 2 partial-onset epilepsy study in adults ongoing. Part A complete and Part B underway with data expected mid-2017
    • CBDV pre-clinical research ongoing within field of autism spectrum disorders. Phase 2 trials expected to commence in Q3 2017
      • Orphan Drug Designation from FDA for CBDV for the treatment of Rett syndrome
    • Neonatal Hypoxic-Ischemic Encephalopathy (NHIE) intravenous CBD program
      • Phase 1 trial commenced in December 2016
      • Orphan Drug and Fast Track Designations granted from FDA and EMA
    • THC:CBD for the treatment of Recurrent Glioblastoma Multiforme (GBM)
      • Phase 1b/2a study completed — data expected Q1 2017
      • Orphan Drug Designation from FDA
    • Sativex® Phase 2 study in children with spasticity due to cerebral palsy completed — data expected Q1 2017

FINANCIAL HIGHLIGHTS

  • Revenue for the twelve months ended 30 September 2016 of £10.3 million ($13.3 million) compared to £28.5 million for the twelve months ended 30 September 2015.

  • Loss for the twelve months ended 30 September 2016 of £63.7 million ($82.2 million) compared to £44.6 million for the twelve months ended 30 September 2015.

  • Cash and cash equivalents at 30 September 2016 of £374.4 million ($483.4 million) compared to £234.9 million as at 30 September 2015.

Conference Call and Webcast Information

GW Pharmaceuticals will host a conference call and webcast to discuss the fourth quarter and year-end 2016 financial results today at 8:00 a.m.. To participate in the conference call, please dial 877-407-8133 (toll free from the U.S. and Canada) or 201-689-8040 (international). Investors may also access a live audio webcast of the call via the investor relations section of the Company's website at http://www.gwpharm.com. A replay of the call will also be available through the GW website shortly after the call and will remain available for 90 days. Replay Numbers: (toll free):1-877-481-4010, (international):1-919-882-2331. For both dial-in numbers please use conference ID # 13650870.

About GW Pharmaceuticals plc

Founded in 1998, GW is a biopharmaceutical company focused on discovering, developing and commercializing novel therapeutics from its proprietary cannabinoid product platform in a broad range of disease areas. GW is advancing an orphan drug program in the field of childhood epilepsy with a focus on Epidiolex® (cannabidiol), which is in Phase 3 clinical development for the treatment of Dravet syndrome, Lennox-Gastaut syndrome, Tuberous Sclerosis Complex and Infantile Spasms. GW commercialized the world's first plant-derived cannabinoid prescription drug, Sativex®, which is approved for the treatment of spasticity due to multiple sclerosis in 30 countries outside the United States. The Company has a deep pipeline of additional cannabinoid product candidates which includes compounds in Phase 1 and 2 trials for glioma, schizophrenia and epilepsy. For further information, please visit www.gwpharm.com.

Forward-looking statements

This news release contains forward-looking statements that reflect GW's current expectations regarding future events, including statements regarding financial performance, the timing of clinical trials, the relevance of GW products commercially available and in development, the clinical benefits of Sativex® and Epidiolex® and the safety profile and commercial potential of Sativex and Epidiolex. Forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein and depend on a number of factors, including (inter alia), the success of GW's research strategies, the applicability of the discoveries made therein, the successful and timely completion of uncertainties related to the regulatory process, and the acceptance of Sativex, Epidiolex and other products by consumer and medical professionals. A further list and description of risks and uncertainties associated with an investment in GW can be found in GW's filings with the U.S. Securities and Exchange Commission. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. GW undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise.

Enquiries:

GW Pharmaceuticals plc 
Stephen Schultz, VP Investor Relations  401 500 6570
  
Sam Brown (U.S. Media Enquiries) 
Amanda Foley+610 725 0725 / 610 585 9400
  

Solely for the convenience of the reader, unless otherwise indicated, all pound sterling amounts stated in the Condensed Consolidated Balance Sheet as at 30 September 2016, the Condensed Consolidated Income Statement, Condensed Consolidated Statement of Comprehensive Income, Condensed Consolidated Statement of Changes in Equity and the Condensed Consolidated Cash Flow Statement for the three months and for the year ended 30 September 2016 have been translated into U.S. dollars at the rate on 30 September 2016 of $1.29128 to £1.00. These translations should not be considered representations that any such amounts have been, could have been or could be converted into U.S. dollars at that or any other exchange rate as at that or any other date.


GW Pharmaceuticals plc
Condensed consolidated income statement
Three months ended 30 September 2016

  Three months
 ended
Three months
 ended
Three months
 ended
  30 September30 September30 September
   2016  2016  2015
  $000's£000's£000's
Revenue  2,156   1,670   5,595 
Cost of sales  (1,006)  (779)  (683)
Research and development expenditure  (31,401)  (24,318)  (25,457)
Sales, general and administrative expenses  (9,645)  (7,469)  (4,988)
Net foreign exchange gain  8,099   6,272   6,874 
     
Operating loss  (31,797)  (24,624)  (18,659)
Interest and other income  408   316   83 
Interest expense  (155)  (120)  (15)
     
Loss before tax  (31,544)  (24,428)  (18,591)
Tax benefit  9,710   7,520   6,358 
     
Loss for the period  (21,834)  (16,908)  (12,233)
     
     
Loss per share — basic and diluted (7.4c)(5.7p)(4.7p)

All activities relate to continuing operations.


Condensed consolidated statement of comprehensive loss                         
For the three months ended 30 September 2016

 Three months
ended

30 September
2016
£000's
Three months
ended
30 September
2015
£000's
Loss for the period (16,908) (12,233)
Items that may be reclassified subsequently to profit or loss  
Exchange differences on translation of foreign operations 183  (51)
Other comprehensive gain/(loss) for the period 183  (51)
Total comprehensive loss for the period (16,725) (12,284)


GW Pharmaceuticals plc
Condensed consolidated income statement
Year ended 30 September 2016

  Year endedYear endedYear ended
  30 September  30 September
30 September
   2016  2016  2015
  $000's£000's£000's
Revenue  13,320   10,315   28,540 
Cost of sales  (3,511)  (2,719)  (2,618)
Research and development expenditure  (128,889)  (99,815)  (76,785)
Sales, general and administrative expenses  (25,747)  (19,939)  (12,569)
Net foreign exchange gain  32,993   25,551   6,202 
     
Operating loss  (111,834)  (86,607)  (57,230)
Other income  785   608   244 
Interest expense  (223)  (173)  (75)
     
Loss before tax  (111,272)  (86,172)  (57,061)
Tax benefit  29,073   22,515   12,498 
     
Loss for the year  (82,199)  (63,657)  (44,563)
     
     
Loss per share — basic and diluted (30.4c)(23.5p)(18.1p)

All activities relate to continuing operations.


Condensed consolidated statement of comprehensive loss                         
For the year ended 30 September 2016

 Year ended
30 September
2016
£000's
Year ended
30 September
2015
£000's
Loss for the year (63,657) (44,563)
Items that may be reclassified subsequently to profit or loss  
Exchange differences on translation of foreign operations 349  (71)
Other comprehensive gain/(loss) for the year 349  (71)
Total comprehensive loss for the year (63,308) (44,634)


GW Pharmaceuticals plc
Condensed consolidated statement of changes in equity
Year ended 30 September 2016

 Called-up  Share   
 share  premium  OtherAccumulatedTotal
 capital  account  reserves  deficit  equity
 £000's£000's£000's£000's£000's
Balance at 1 October 2014 237  220,551  19,260  (81,464) 158,584 
Issue of share capital22  127,812      127,834 
Expense of new equity issue  (271)     (271)
Exercise of share options2  1,183      1,185 
Share-based payment transactions      2,488  2,488 
Loss for the year      (44,563) (44,563)
Deferred tax attributable to unrealized share option gains      84  84 
Other comprehensive expense    (71)   (71)
      
Balance at 30 September 2015261  349,275  19,189  (123,455) 245,270 
      
      
      
      
Balance at 1 October 2015261  349,275  19,189  (123,455) 245,270 
Issue of share capital39  206,512      206,551 
Expense of new equity issue  (472)     (472)
Underwriters' contribution towards expenses of new equity issue  472      472 
Exercise of share options2  690      692 
Share-based payment transactions      8,152  8,152 
Loss for the year      (63,657) (63,657)
Deferred tax attributable to unrealized share option gains      1,133  1,133 
Other comprehensive expense    349    349 
      
Balance at 30 September 2016302  556,477  19,538  (177,827) 398,490 
      

GW Pharmaceuticals plc
Condensed consolidated balance sheet
As at 30 September 2016

  As at
30 September
As at
30 September
As at
30 September
   2016  2016 2015
     
Non-current assets $000's£000's £000's
Intangible assets - goodwill  6,728   5,210  5,210 
Other intangible assets  812   629  245 
Property, plant and equipment  50,291   38,947  28,733 
Deferred tax asset  5,001   3,873  418 
     
   62,832   48,659  34,606 
     
Current assets    
Inventories  5,485   4,248  4,756 
Taxation recoverable  27,533   21,322  12,641 
Trade receivables and other assets  5,883   4,556  2,873 
Cash and cash equivalents  483,445   374,392  234,872 
     
   522,346   404,518  255,142 
          
Total assets  585,178   453,177  289,748 
     
Current liabilities    
Trade and other payables  (40,249)  (31,170) (24,022)
Current tax liabilities  (1,140)  (883) (366)
Obligations under finance leases  (272)  (211) (111)
Deferred revenue  (3,468)  (2,686) (3,269)
     
   (45,129)  (34,950) (27,768)
     
Non-current liabilities    
Trade and other payables  (12,168)  (9,423) (8,445)
Obligations under finance leases  (6,403)  (4,959) (1,540)
Deferred revenue  (6,915)  (5,355) (6,725)
     
Total liabilities  (70,615)  (54,687) (44,478)
     
Net assets  514,563   398,490  245,270 
     
     
Equity    
Share capital  390   302  261 
Share premium account  718,568   556,477  349,275 
Other reserves  25,229   19,538  19,189 
Accumulated deficit   (229,624)  (177,827) (123,455)
     
Total equity 514,563   398,490  245,270 


GW Pharmaceuticals plc
Condensed consolidated cash flow statement
As at 30 September 2016

 Year endedYear endedYear ended 
 30 September 201630 September 201630 September 2015 
 $000's  £000's  £000's 
Loss for the year (82,199) (63,657) (44,563) 
Adjustments for:    
Other income (785) (608) (244) 
Interest expense 223  173  75  
Tax benefit (29,073) (22,515) (12,498) 
Depreciation of property, plant and equipment 4,654  3,605  2,250  
Impairment of property, plant and equipment      606  
Amortization of intangible assets 80  62  52  
Net foreign exchange gains (32,993) (25,551) (6,282) 
Increase in provision for inventories 93  72  33  
Decrease in deferred signature fees (1,511) (1,170) (1,250) 
Share-based payment charge 10,527  8,152  2,478  
Loss on disposal of property, plant and equipment 1  1  1  
     
  (130,983) (101,436) (59,342) 
Decrease/(increase) in inventories 563  436  (12) 
Increase in trade receivables and other assets (972) (753) (1,010) 
Increase in trade and other payables and deferred revenue 6,148  4,761  8,478  
     
Cash used in operations (125,244) (96,992) (51,886) 
Income taxes paid (1,140) (883)    
Research and development tax credits received 17,150  13,281  5,415  
     
Net cash outflow from operating activities (109,234) (84,594) (46,471) 
     
Investing activities    
Interest received 560  434  236  
Purchases of property, plant and equipment (11,206) (8,678) (17,915) 
Purchase of intangible assets (661) (512) (114) 
Proceeds from sales of property, plant and equipment
     2  
     
Net cash outflow from investing activities (11,307) (8,756) (17,791) 
     
Financing activities    
Proceeds on exercise of share options 697  540  1,185  
Proceeds of new equity issue 266,714  206,550  127,834  
Expenses of new equity issue (412) (319) (271) 
Underwriters' contribution towards expenses of new equity issue 609  472    
Interest paid (89) (69) (74) 
Repayments of advance funding (310) (240)   
Repayments of obligations under finance leases (164) (127) (255) 
     
Net cash inflow from financing activities 267,045  206,807  128,419  
     
Effect of foreign exchange rate changes on cash and cash equivalents 33,655  26,063  6,224  
     
Net increase in cash and cash equivalents 180,159  139,520  70,381  
Cash and cash equivalents at beginning of the year 303,286  234,872  164,491  
    
Cash and cash equivalents at end of the year483,445   374,392  234,872  

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