InVivo Therapeutics Reports First Quarter 2013 Financial Results, Provides Business Update
InVivo Therapeutics Reports First Quarter 2013 Financial Results, Provides Business Update
CAMBRIDGE, Mass.--(BUSINESS WIRE)-- InVivo Therapeutics Holdings Corp. (NVIV), a developer of groundbreaking technologies for the treatment of spinal cord injuries (SCI) and other neurotrauma conditions, today reported financial results for the three months ended March 31, 2013 and provided a business update.
InVivo has pioneered a new treatment platform utilizing a variety of biocompatible polymer-based devices to provide structural support to a damaged spinal cord in order to spare tissue from scarring while improving functional recovery and prognosis after a traumatic spinal cord injury. Today there is no effective treatment for the spinal cord for paralysis caused by SCIs, and the market potential is estimated to be over $15 billion.
"We are off to a great start for 2013 and continue to successfully accelerate our plans," said Frank Reynolds, InVivo's Chief Executive Officer. "We've received FDA approval to commence a first-in- man clinical study for our biopolymer scaffolding to treat acute SCI, and we also received Humanitarian Use Device designation for the product. Wall Street has noticed, and our stock price has appreciated significantly since these key milestones were achieved. This has permitted us to call investor warrants that will provide up to $16.1 million of equity capital, but more importantly, will remove an accounting liability that has been an impediment to up-listing to a national securities exchange." Continued Reynolds, "In recent weeks, we've held productive meetings with the NYSE and NASDAQ, and we look forward to ringing the bell on an exchange in NYC soon. We've also made excellent progress identifying 510(k) products based on our hydrogel technology, and we expect two of them to generate revenue in 2014. Our new materials are advancing in development, creating a large portfolio of products to treat neurotrauma conditions."
Recent Corporate Highlights
First-in-Man Human Trial Approved by FDA for Scaffolding to Treat Acute SCI:
In April 2013, the FDA approved InVivo's Investigational Device Exemption (IDE) application to begin human studies to evaluate its biopolymer scaffold product for acute traumatic SCI. The trial is designed as an open label study, and the product will be evaluated in five patients. The Company expects to commence the study in mid-2013 and submit data to the FDA by the end of 2014.
FDA Approval of 'Orphan' Device Designation for Scaffolding to Treat Acute SCI:
In April 2013, the FDA also approved InVivo's request for Humanitarian Use Device (HUD) designation for its biopolymer scaffolding. HUD designation covers devices such as InVivo's that treat rare, 'orphan' diseases or conditions, and historically has permitted an expedited path to market. InVivo has received the HUD designation for the use of its biopolymer scaffolding for the treatment of recent, complete spinal cord injury (no motor or sensory function) that does not involve penetrating injury or a complete severing of the spinal cord.
Multiple Neurotrauma Products to Move into the Clinic:
InVivo has commenced the development of novel injectable hydrogels to be used to treat fibrosis and as dural sealants, dural replacements, and nerve conduits. The FDA regulates biomaterials used as dural replacements and nerve conduits as 510(k) products, and the Company expects to file 510(k) applications for these indications in 2014. The Company has already engaged with the FDA on InVivo's novel injectable hydrogel product specifically engineered to locally deliver and release drugs for the treatment of peripheral nerve pain, an expected $24 billion market opportunity. The Company intends to meet with representatives from the FDA's Office of Combination Products in the coming months to map out a clinical development plan. InVivo also recently completed a pre-clinical nerve pain study with the Geisinger Health System and anticipates that this promising data will be submitted for publication during 2013.
Warrant Call Notice to Raise Up to $16.1 Million and Paves Way for Stock Up Listing:
On May 3, 2013 the Company issued a call notice for the early exercise of investor warrants issued in 2010. Since the start of April 2013, the Company has received $5.7 million from the early exercise of these warrants and expects to receive an additional $10.4 million from the warrant call. On June 3, 2013, all investor warrants that are not exercised will be redeemed and the derivative warrant liability on InVivo's books associated with the exercise or redemption of these warrants will be eliminated. This will remove a major impediment towards the uplisting of the Company's stock to a national securities exchange.
Key Addition to Board of Directors to Support Commercialization Phase:
John McCarthy, Chief Executive of CryoXtract, joined InVivo's Board in April 2013. Mr. McCarthy brings to InVivo more than thirty years of experience building high-value, commercially driven organizations. He has led the transformational growth of numerous science- and technology-based companies from early-stage organizations into successful commercial entities, in both private and public markets. Mr. McCarthy's track record includes successfully raising more than $1.2 billion across the capital market.
InVivo Named a 2013 Best Places to Work Winner by Boston Business Journal:
InVivo was named one of the Best Places to Work in Massachusetts by The Boston Business Journal. The honor recognizes the Company's achievements in creating a positive work environment that attracts and retains employees through a combination of employee satisfaction, working conditions and company culture.
Financial Results
For the three months ended March 31, 2013, the Company reported a net loss of $13,326,000 or $.20 per diluted share, compared to net income of $3,150,000, or $.05 per diluted share, for the three months ended March 31, 2012. Included in results for the three months ended March 31, 2013 was a non-cash derivative loss of $10,449,000 and for the three months ended March 31,2012 a non-cash derivative gain of $5,613,000, each reflecting changes in the fair value of the derivative warrant liability. Exclusive of the non-cash derivative gain and loss, the pro forma net loss for the three months ended March 31, 2013 was $2,877,000 or $.04 per diluted share, compared to a pro forma net loss of $2,463,000 or $.04 per diluted share for 2012.
About InVivo Therapeutics
InVivo Therapeutics Holdings Corp. is focused on utilizing polymers as a platform technology to develop treatments to improve function in individuals paralyzed as a result of traumatic spinal cord injury. The Company was founded in 2005 on the basis of proprietary technology co-invented by Robert Langer, ScD., Professor at Massachusetts Institute of Technology, and Joseph P. Vacanti, M.D., who is affiliated with Massachusetts General Hospital. In 2011, the Company earned the prestigious David S. Apple Award from the American Spinal Injury Association for its outstanding contribution to spinal cord injury medicine. The publicly traded company is headquartered in Cambridge, MA. For more details, visit www.invivotherapeutics.com.
Safe Harbor Statement
Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements within the meaning of the federal securities laws. Any forward-looking statements contained herein are based on current expectations, but are subject to a number of risks and uncertainties. The factors that could cause actual future results to differ materially from current expectations include, but are not limited to, risks and uncertainties relating to the Company's ability to sell additional shares of common stock and warrants to purchase common stock, the Company's ability to develop, market and sell products based on its technology; the expected benefits and efficacy of the Company's products and technology in connection with spinal cord injuries; the availability of substantial additional funding for the Company to continue its operations and to conduct research and development, clinical studies and future product commercialization; and the Company's business, research, product development, regulatory approval, marketing and distribution plans and strategies. These and other factors are identified and described in more detail in our filings with the SEC, including our Form 10-K and 10-Q's and our current reports on Form 8-K. We do not undertake to update these forward-looking statements made by us.
(Tables to follow)
InVivo Therapeutics Holdings Corp. | ||||||||||||
A Developmental Stage Company | ||||||||||||
Consolidated Statements of Operations | ||||||||||||
(Unaudited) | ||||||||||||
Period from | ||||||||||||
November 28, | ||||||||||||
2005 | ||||||||||||
Three Months Ended | (inception) to | |||||||||||
March 31, | March 31, | |||||||||||
2013 | 2012 | 2013 | ||||||||||
Operating expenses: | ||||||||||||
Research and development | $ | 1,213,483 | $ | 940,553 | $ | 16,473,112 | ||||||
General and administrative | 1,637,983 | 1,520,212 | 16,293,176 | |||||||||
Total operating expenses | 2,851,466 | 2,460,765 | 32,766,288 | |||||||||
Operating loss | (2,851,466 | ) | (2,460,765 | ) | (32,766,288 | ) | ||||||
Other income (expense): | ||||||||||||
Other income | - | - | 383,000 | |||||||||
Interest income | 2,580 | 2,437 | 57,813 | |||||||||
Interest expense | (28,555 | ) | (5,006 | ) | (1,166,612 | ) | ||||||
Derivatives gain (loss) | (10,448,816 | ) | 5,613,206 | (22,987,303 | ) | |||||||
Other income (expense), net | (10,474,791 | ) | 5,610,637 | (23,713,102 | ) | |||||||
Net income (loss) | $ | (13,326,257 | ) | $ | 3,149,872 | $ | (56,479,390 | ) | ||||
Net income (loss) per share, basic | $ | (0.20 | ) | $ | 0.05 | $ | (1.55 | ) | ||||
Net income (loss) per share, diluted | $ | (0.20 | ) | $ | 0.05 | $ | (1.55 | ) | ||||
Weighted average number of common shares outstanding, basic | 66,043,378 | 58,004,471 | 36,379,256 | |||||||||
Weighted average number of common shares outstanding, diluted | 66,043,378 | 69,008,549 | 36,379,256 | |||||||||
InVivo Therapeutics Holdings Corp. | ||||||||
Consolidated Balance Sheets | ||||||||
As of | ||||||||
March 31, 2013 | December 31, 2012 | |||||||
ASSETS: | Unaudited | |||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 10,300,993 | $ | 12,825,090 | ||||
Restricted cash | 601,381 | 601,351 | ||||||
Prepaid expenses | 206,748 | 143,867 | ||||||
Total current assets | 11,109,122 | 13,570,308 | ||||||
Property, equipment and leasehold improvements, net | 2,559,783 | 2,311,942 | ||||||
Other assets | 173,900 | 179,415 | ||||||
Total assets | $ | 13,842,805 | $ | 16,061,665 | ||||
LIABILITIES AND STOCKHOLDERS' DEFICIT: | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 1,082,885 | $ | 1,152,550 | ||||
Capital lease payable-current portion | 27,420 | 32,606 | ||||||
Derivative warrant liability | 24,557,208 | 14,584,818 | ||||||
Accrued expenses | 709,522 | 1,021,275 | ||||||
Total current liabilities | 26,377,035 | 16,791,249 | ||||||
Loan payable-less current portion | 1,800,000 | 1,578,000 | ||||||
Capital lease payable-less current portion | - | 2,799 | ||||||
Total liabilities | 28,177,035 | 18,372,048 | ||||||
Commitments and contingencies | ||||||||
Stockholders' deficit: | ||||||||
Common stock, $0.00001 par value, authorized 200,000,000 | ||||||||
shares at March 31, 2013 and December 31, 2012; | ||||||||
issued and outstanding and 66,193,229 and 65,881,122 shares | ||||||||
at March 31, 2013 and December 31, 2012, respectively | 662 | 659 | ||||||
Additional paid-in capital | 42,144,746 | 40,842,339 | ||||||
Deficit accumulated during the development stage | (56,479,638 | ) | (43,153,381 | ) | ||||
Total stockholders' deficit | (14,334,230 | ) | (2,310,383 | ) | ||||
Total liabilities and stockholders' deficit | $ | 13,842,805 | $ | 16,061,665 | ||||
InVivo Therapeutics Holdings Corp. | ||||||||
(A Developmental Stage Company) | ||||||||
Pro Forma Results | ||||||||
Three Months Ended, | ||||||||
March 31, | ||||||||
2013 | 2012 | |||||||
Pro Forma Net Loss | $ | (2,877,441 | ) | $ | (2,463,334 | ) | ||
Derivative Gain (Loss) | (10,448,816 | ) | 5,613,206 | |||||
Reported GAAP Net Income (Loss) | $ | (13,326,257 | ) | $ | 3,149,872 | |||
Pro Forma Net Loss Per Diluted Share | $ | (0.04 | ) | $ | (0.04 | ) | ||
Derivative Gain (Loss) Per Diluted Share | (0.16 | ) | 0.09 | |||||
Reported GAAP Net Loss Per Diluted share | $ | (0.20 | ) | $ | 0.05 | |||
InVivo Therapeutics Holdings Corp.
Brian Luque, 617-863-5535
Director, Investor Relations
bluque@invivotherapeutics.com
KEYWORDS: United States North America Massachusetts
INDUSTRY KEYWORDS:
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