TIDMAMYT
Amryt Reports Record Q2 2021 Results and Raises FY 2021
Guidance
Acquisition of Chiasma completed
Amryt now has three approved commercial products and a robust
clinical pipeline
35.9% YoY revenue growth in Q2 to $62.8M
6(th) consecutive quarter of positive EBITDA generation
Cash increased to $142.9M at June 30 from $118.6M at March
31
Oleogel-S10 NDA accepted by the FDA, Priority Review granted;
target PDUFA date set for November 30, 2021
Raising FY 2021 revenue guidance to $210M - $215M, representing
15-18% YoY growth
Conference call and webcast today at 0830 EDT / 1330 BST
DUBLIN, Ireland, and Boston MA, August 6, 2021, Amryt (Nasdaq:
AMYT, AIM: AMYT), a global, commercial-stage biopharmaceutical
company dedicated to acquiring, developing and commercializing
novel treatments for rare diseases, today provides a business
update and announces unaudited financial results for the second
quarter ended June 30, 2021, as well as its unaudited half yearly
report to June 30, 2021.
Joe Wiley, CEO of Amryt Pharma, commented: "Q2 was an extremely
busy and productive period for Amryt and I am excited to present
today's record results and also report that we have completed the
acquisition of Chiasma, Inc. Our Q2 revenues of $62.8M represent a
35.9% increase on the previous year and 29.6% growth on Q1 2021.
These results demonstrate the positive momentum and strong growth
we are experiencing across our business, supported by our
exceptional team who during the quarter delivered several important
commercial and regulatory successes. Our commercial products,
metreleptin and lomitapide, continued to deliver solid growth
across a host of metrics including revenue, EBITDA, cash generation
and market expansion. Importantly, our EBITDA has increased 152%
compared to the same quarter in 2021 and our cash balances
increased to $142.9M at the end of the quarter.
During the quarter, we also made significant positive progress
on the regulatory pathway for Oleogel-S10 in both the US and
Europe. The FDA confirmed that our New Drug Application for
Oleogel-S10 has been accepted and granted priority review. If
approved as our fourth commercial product, we already have the
team, systems and global infrastructure in place to bring
Oleogel-S10 to market. Oleogel-S10 is a potential treatment for the
cutaneous manifestations of severe EB, a rare and distressing
genetic skin disorder affecting young children and adults for which
there is currently no approved treatment and if approved, it would
be the first to market novel therapy for those patients suffering
from this devastating condition.
Given the strong performance of our business year to date, we
are pleased to increase our full year 2021 revenue guidance to
$210-$215 million which represents growth of 15%-18% on 2020. This
latest upward revision of guidance demonstrates our confidence in
the outlook for our underlying business and in addition, we expect
that this guidance will be further enhanced by revenues from
Mycapssa(R).
Finally, following the recent endorsement from both Amryt and
Chiasma shareholders for Amryt's acquisition of Chiasma, Inc., we
look forward to beginning the process of integrating and growing
our combined business."
Q2 2021 and Recent Business Highlights:
-- Announced proposed acquisition of Chiasma, Inc.
-- FDA accepted New Drug Application (NDA) for Oleogel-S101
-- FDA granted Priority Review for Oleogel-S10 and set a target PDUFA date
of November 30, 2021
-- FDA confirms Oleogel-S10 will not require an Advisory Committee Meeting
-- Commercial launch plans well advanced for Oleogel-S10 launch, if
approved
-- Chiasma, Inc. acquisition endorsed by Amryt and Chiasma shareholders and
subsequently completed
Q2 2021 Commercial Product Performance:
Q2 2021 (unaudited)
-------------- ----------------------------------
US EMEA Other Total
-------------- ------- ------- ------- -------
US$'000 US$'000 US$'000 US$'000
-------------- ------- ------- ------- -------
Metreleptin 17,739 11,005 14,315 43,059
-------------- ------- ------- ------- -------
Lomitapide 8,490 7,492 3,468 19,450
-------------- ------- ------- ------- -------
Other - 193 60 253
-------------- ------- ------- ------- -------
Total revenue 26,229 18,690 17,843 62,762
-------------- ------- ------- ------- -------
Q2 2020 (unaudited)
-------------- ----------------------------------
US EMEA Other Total
-------------- ------- ------- ------- -------
US$'000 US$'000 US$'000 US$'000
-------------- ------- ------- ------- -------
Metreleptin 14,666 11,182 2,051 27,899
-------------- ------- ------- ------- -------
Lomitapide 9,344 6,341 2,367 18,052
-------------- ------- ------- ------- -------
Other - 146 88 234
-------------- ------- ------- ------- -------
Total revenue 24,010 17,669 4,506 46,185
-------------- ------- ------- ------- -------
-- 35.9% YoY revenue growth in Q2 2021 to $62.8M (Q2 2020: $46.2M)
-- 54.3% increase in metreleptin revenues YoY to $43.1M in Q2 2021 (Q2
2020: $27.9M) that included a LATAM order of $12.1M
-- US accounted for 41.2% of global metreleptin revenues and EMEA accounted
for 25.6% in Q2 2021
-- 7.7% increase in lomitapide revenues to $19.5M in Q2 2021 (Q2 2020:
$18.1M)
-- US accounted for 43.7% of global lomitapide revenues and EMEA accounted
for 38.5% in Q2 2021
-- 29.6% QoQ revenue growth in Q2 2021 versus Q1 2021 ($48.4M)
Q2 2021 Financial Highlights:
-- $4.1M operating profit before finance expense for Q2 2021 (Q2 2020:
$12.0M operating loss). Excluding non-cash items and share based
compensation expenses, this resulted in EBITDA3 of $17.4M (Q2 2020:
$6.9M).
-- Cash of $142.9M at June 30, 2021 (Mar 31, 2021: $118.6M)
IFRS and non-GAAP adjusted Q2 2021 results:
Q2 2021
Q2 2020 Q2 2021 Non-cash Q2 2021 Non-GAAP
US$M (unaudited) (unaudited) adjustments(2) Adjusted
------------------------------ ------------ ------------ --------------- ----------------
Revenue 46.2 62.8 - 62.8
------------------------------ ------------ ------------ --------------- ----------------
Gross profit 16.7 36.6 11.0 47.6
------------------------------ ------------ ------------ --------------- ----------------
R&D expenses (6.2) (8.5) - (8.5)
------------------------------ ------------ ------------ --------------- ----------------
SG&A expenses (21.6) (22.0) 0.3 (21.7)
------------------------------ ------------ ------------ --------------- ----------------
Restructuring and acquisition
costs (0.1) - - -
------------------------------ ------------ ------------ --------------- ----------------
Share based compensation
expenses (0.8) (2.0) 2.0 -
------------------------------ ------------ ------------ --------------- ----------------
Operating (loss) / profit
before finance expense (12.0) 4.1 13.3 17.4(3)
------------------------------ ------------ ------------ --------------- ----------------
(1) For the purposes of this announcement, we use the name
Oleogel-S10. Filsuvez(R) 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.
(2) Non-cash items include amortisation of the acquired
metreleptin and lomitapide intangible assets ($10.7M), amortisation
of the inventory fair value step-up that was acquired at the
acquisition date ($0.3M), depreciation and amortisation ($0.3M) and
share based compensation expenses ($2.0M).
(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.
Guidance & Outlook:
Given the continued strong performance of the Company's
commercial products, the board is today again raising revenue
guidance for FY 2021 to a range of $210M - $215M versus prior
guidance of $205M - $210M (issued May 5, 2021). This represents
growth of 15% to 18% on FY 2020. This guidance demonstrates the
Board's confidence in the outlook for our business and does not
reflect the expected contribution from Mycapssa(R) in H2 2021.
Virtual Capital Markets Event:
Amryt will hold a virtual capital markets event in mid-September
to update the market on the company's plans for Mycapssa(R) and to
discuss Amryt's launch preparedness for Oleogel-S10, if approved.
Details of this event will be issued shortly.
Conference Call & Webcast:
Amryt will host a conference call and webcast for analysts and
investors on Aug 6 at 0830 EDT/1330 BST.
Webcast Player URL:
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Telephone Dial in details:
United States +1 646 787 1226
------------------ --------------------
United Kingdom +44 (0) 203 009 5709
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Ireland +353 (1) 506 0626
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Confirmation Code 3486585
------------------ --------------------
About Amryt
Amryt is a global commercial-stage biopharmaceutical company
focused on acquiring, developing and commercializing innovative
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 three orphan disease
products -- metreleptin (Myalept(R)/ Myalepta(R)); octreotide
(Mycapssa(R)); and lomitapide (Juxtapid(R)/ Lojuxta(R)).
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)) as an adjunct
to diet 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. For
additional information, please follow this
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link.
Mycapssa(R) (octreotide) is approved in the US for long-term
maintenance therapy in acromegaly patients who have responded to
and tolerated treatment with octreotide or lanreotide. Mycapssa(R)
is the first and only oral somatostatin analog approved by the FDA.
Mycapssa(R) has also been submitted to the EMA for regulatory
approval. For additional information, please follow this
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link.
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, Colombia,
Argentina and Japan (under the trade name Juxtapid(R)) and in the
EU, Israel and Brazil (under the trade name Lojuxta(R)). For
additional information, please follow this
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link.
Amryt's lead development candidate, Oleogel-S10 (Filsuvez(R)) is
a potential treatment for the cutaneous manifestations of
Junctional and Dystrophic Epidermolysis Bullosa ("EB"), a rare and
distressing genetic skin disorder affecting young children and
adults for which there is currently no approved treatment.
Filsuvez(R) has been selected as the brand name for Oleogel-S10.
The product has been submitted to FDA for approval and in June
2021, Amryt received confirmation from the FDA that its NDA for
Oleogel-S10 had been accepted and granted priority review. The FDA
also set a target PDUFA date of November 30, 2021.
Amryt's pre-clinical gene therapy candidate, AP103, offers a
potential treatment for patients with Dystrophic EB, and the
polymer-based delivery platform has the potential to be developed
for the treatment of other genetic disorders.
Amryt also intends to develop oral medications that are
currently only available as injectable therapies through its
Transient Permeability Enhancer (TPE(R) ) technology platform.
For more information on Amryt, including products, please visit
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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.
Forward-Looking Statements
This press release may contain forward-looking 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.
Contacts
Joe Wiley, CEO / Rory Nealon, CFO/COO, +353 (1) 518 0200,
ir@amrytpharma.com
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Edward Mansfield, Shore Capital, NOMAD, +44 (0) 207 468 7906,
edward.mansfield@shorecap.co.uk
Tim McCarthy, LifeSci Advisors, LLC, +1 (212) 915 2564,
tim@lifesciadvisors.com
Amber Fennell, Consilium Strategic Communications, +44 (0) 203
709 5700, fennell@consilium-comms.com
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Amryt Pharma plc
Condensed Consolidated Statement of Comprehensive Loss
Three Months Ended Six Months Ended
June 30, June 30,
---- -------------------------- --------------------------
2021 2020 2021 2020
Note (unaudited) (unaudited) (unaudited) (unaudited)
---- ------------ ------------
US$'000 US$'000 US$'000 US$'000
Revenue 3 62,762 46,185 111,194 90,759
Cost of sales (26,179) (29,471) (49,668) (62,091)
Gross profit 36,583 16,714 61,526 28,668
Research and development expenses (8,538) (6,197) (17,454) (15,131)
Selling, general and administrative
expenses (22,029) (21,588) (40,185) (39,994)
Restructuring and acquisition costs 5 -- (47) -- (900)
Share based payment expenses 4 (1,953) (858) (3,216) (1,603)
Operating profit/(loss) before finance
expense 4,063 (11,976) 671 (28,960)
============ ============ ============ ============
Non-cash change in fair value of
contingent consideration 5 (2,993) (3,118) (5,867) (6,024)
Non-cash contingent value rights
finance expense 5 (1,837) (1,493) (3,600) (2,941)
Net finance expense - other (5,841) (4,717) (13,739) (14,133)
Loss on ordinary activities before
taxation (6,608) (21,304) (22,535) (52,058)
Tax (charge)/credit on loss on ordinary
activities (191) 3,135 (801) 4,992
Loss for the year attributable to
the equity holders of the Company (6,799) (18,169) (23,336) (47,066)
Exchange translation differences
which may be reclassified through
profit or loss (204) (926) 2,343 (939)
Total other comprehensive (loss)/income (204) (926) 2,343 (939)
Total comprehensive loss for the
year attributable to the equity holders
of the Company (7,003) (19,095) (20,993) (48,005)
Loss per share
Loss per share - basic and diluted,
attributable to ordinary equity holders
of the parent (US$) 6 (0.04) (0.12) (0.13) (0.30)
Amryt Pharma plc
Condensed Consolidated Statement of Financial Position
As at,
June 30, December 31,
2021 2020
Note (unaudited) (audited)
------------
US$'000 US$'000
Assets
Non-current assets
Goodwill 7 19,131 19,131
Intangible assets 7 282,676 305,369
Property, plant and equipment 7,224 7,574
Other non-current assets 1,420 1,542
Total non-current assets 310,451 333,616
Current assets
Trade and other receivables 8 41,506 43,185
Inventories 38,760 40,992
Cash and cash equivalents, including restricted
cash 9 142,946 118,798
Total current assets 223,212 202,975
Total assets 533,663 536,591
Equity and liabilities
Equity attributable to owners of the parent
Share capital 10 13,899 13,851
Share premium 10 51,596 51,408
Other reserves 10 242,706 236,488
Accumulated deficit (258,887) (235,605)
Total equity 49,314 66,142
Non-current liabilities
Contingent consideration and contingent
value rights 5 155,076 148,323
Deferred tax liability 6,948 6,612
Long term loan 11 90,273 87,302
Convertible notes 12 103,375 101,086
Provisions and other liabilities 13 26,854 25,951
Total non-current liabilities 382,526 369,274
Current liabilities
Trade and other payables 94,875 90,236
Provisions and other liabilities 13 6,948 10,939
Total current liabilities 101,823 101,175
Total liabilities 484,349 470,449
Total equity and liabilities 533,663 536,591
Amryt Pharma plc
Condensed Consolidated Statement of Cash Flows
Six months ended June
30,
2021 2020
Note (unaudited) (unaudited)
US$'000 US$'000
Cash flows from operating activities
Loss on ordinary activities after taxation (23,336) (47,066)
Net finance expense - other 13,739 14,133
Depreciation and amortization 22,080 22,747
Amortization of inventory fair value step-up 1,205 15,975
Share based payment expenses 4 3,216 1,603
Non-cash change in fair value of contingent
consideration 5 5,867 6,024
Non-cash contingent value rights finance
expense 5 3,600 2,941
Deferred taxation charge/(credit) 336 (4,646)
Movements in working capital and other
adjustments:
Change in trade and other receivables 8 1,677 (9,872)
Change in trade and other payables 5,726 12,828
Change in provision and other liabilities 13 (2,823) (9,593)
Change in inventories 1,027 4,049
Change in non-current assets 122 552
Net cash flow from operating activities 32,436 9,675
Cash flow from investing activities
Payments for property, plant and equipment (76) (79)
Payments for intangible assets (722) --
Deposit interest received 2 85
Net cash flow (used in)/from investing
activities (796) 6
Cash flow from financing activities
Net costs from issue of equity instruments (175) --
Interest paid (6,047) (4,850)
Payment of leases (526) (667)
Net cash flow from financing activities (6,748) (5,517)
------------ ------------
Exchange and other movements (744) (4,267)
Net change in cash and cash equivalents 24,148 (103)
Cash and cash equivalents at beginning of the
period 118,798 67,229
Restricted cash at end of the period 9 -- 151
Cash at bank available on demand at end of the
period 9 142,946 66,975
Total cash and cash equivalents at end of the
period 9 142,946 67,126
Amryt Pharma plc
Condensed Consolidated Statement of Changes in Equity
For the period ended June 30, 2021
(unaudited)
Share based Reverse Equity component Currency
Share Share Warrant Treasury payment Merger acquisition of convertible Other distributable translation Accumulated
Note capital premium reserve shares reserve reserve reserve notes reserves reserve deficit Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance at January 1, 2021
(audited) 13,851 51,408 14,762 (7,421) 7,860 42,627 (73,914) 29,210 217,634 5,730 (235,605) 66,142
Loss for the period -- -- -- -- -- -- -- -- -- -- (23,336) (23,336)
Foreign exchange translation
reserve -- -- -- -- -- -- -- -- -- 2,343 -- 2,343
Total comprehensive loss -- -- -- -- -- -- -- -- -- 2,343 (23,336) (20,993)
Transactions with owners
Issue of treasury shares
in exchange for warrants 10 23 99 -- 439 -- -- -- -- -- -- -- 561
Issue of treasury shares
for share options exercised 10 25 89 -- 465 (191) -- -- -- -- -- -- 388
Share based payment expense 4 -- -- -- -- 3,216 -- -- -- -- -- -- 3,216
Share based payment expense
-- Lapsed -- -- -- -- (54) -- -- -- -- -- 54 --
Total transactions with
owners 48 188 -- 904 2,971 -- -- -- -- -- 54 4,165
Balance at June 30, 2021
(unaudited) 13,899 51,596 14,762 (6,517) 10,831 42,627 (73,914) 29,210 217,634 8,073 (258,887) 49,314
For the period ended June 30, 2020
(unaudited)
Share based Reverse Equity component Currency
Share Share Warrant Treasury payment Merger acquisition of convertible Other distributable translation Accumulated
Note capital premium reserve shares reserve reserve reserve notes reserves reserve deficit Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance at January 1, 2020
(audited) 11,918 2,422 29,523 (7,534) 3,190 42,627 (73,914) 29,210 217,634 7,920 (133,674) 129,322
Loss for the period -- -- -- -- -- -- -- -- -- -- (47,066) (47,066)
Foreign exchange translation
reserve -- -- -- -- -- -- -- -- -- (939) -- (939)
Total comprehensive loss -- -- -- -- -- -- -- -- -- (939) (47,066) (48,005)
Transactions with owners
Share based payment expense 4 -- -- -- -- 1,603 -- -- -- -- -- -- 1,603
Share based payment expense
-- Lapsed -- -- -- -- (56) -- -- -- -- -- 56 --
Total transactions with
owners -- -- -- -- 1,547 -- -- -- -- -- 56 1,603
Balance at June 30, 2020
(unaudited) 11,918 2,422 29,523 (7,534) 4,737 42,627 (73,914) 29,210 217,634 6,981 (180,684) 82,920
1. General information
Amryt is a global commercial-stage biopharmaceutical company
focused on acquiring, developing and commercializing innovative
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.
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).
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)).
Amryt's lead development candidate, Oleogel-S10 (Filsuvez(R)) is
a potential treatment for the cutaneous manifestations of
Junctional and Dystrophic Epidermolysis Bullosa ("EB"), a rare and
distressing genetic skin disorder affecting young children and
adults for which there is currently no approved treatment.
Filsuvez(R) has been selected as the brand name for Oleogel-S10.
The product has been submitted to FDA for approval and in June
2021, Amryt received confirmation from the FDA that its NDA for
Oleogel-S10 had been accepted and granted priority review. The FDA
also set a target PDUFA date of November 30, 2021.
On July 8, 2020, Amryt listed on the NASDAQ Global Select Market
under the symbol AMYT. The Ordinary Shares continue to trade 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, 2020. 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, 2020 and those which are expected to be used in the financial
statements for the year ended December 31, 2021.
Results for the six-month period ended June 30, 2021 are not
necessarily indicative of the results that may be expected for the
financial year ending December 31, 2021.
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.
As part of their inquiries, the Board of Directors reviewed
budgets, projected cash flows, and other relevant information for a
period not less than 12 months from the date of approval of the
condensed consolidated interim financial statements for the period
ended June 30, 2021.
Basis of consolidation
The condensed consolidated interim financial statements comprise
the financial statements of the Group for the period ended June 30,
2021. 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 condensed consolidated interim financial statements.
Presentation of balances
The condensed consolidated interim financial statements are
presented in U.S. dollars ("US$"), rounded to the nearest thousand,
which is the functional currency of the Company and presentation
currency of the Group. The following table discloses the major
exchange rates of those currencies other than the functional
currency of US$ that are utilized by the Group:
Foreign currency units to 1
US$ EUR GBP CHF SEK NOK DKK
Average three-month period
to June 30, 2021 (unaudited) 0.8292 0.7253 0.9043 8.3868 8.5171 6.1669
Average six-month period to
June 30, 2021 (unaudited) 0.8303 0.7157 0.9116 8.4230 8.3785 6.1747
At June 30, 2021 (unaudited) 0.8400 0.7220 0.9208 8.5259 8.5546 6.2463
Foreign currency units to 1
US$ EUR GBP CHF SEK NOK DKK
Average period to December
31, 2020 (audited) 0.8777 0.7799 0.9391 9.2135 9.4206 6.5432
At December 31, 2020
(audited) 0.8141 0.7365 0.8829 8.1885 8.5671 6.0570
Foreign currency units to 1
US$ EUR GBP CHF SEK NOK DKK
Average three-month period
to June 30, 2020 (unaudited) 0.9087 0.8060 0.9649 9.6960 10.0326 6.7776
Average six-month period to
June 30, 2020 (unaudited) 0.9077 0.7935 0.9660 9.6789 9.7529 6.7763
At June 30, 2020 (unaudited) 0.8890 0.8115 0.9486 9.3143 9.6838 6.6259
(EUR = Euro; GBP = Pounds Sterling, CHF = Swiss Franc, SEK =
Swedish Kroner, NOK = Norwegian Kroner, DKK = Danish Kroner)
Changes in accounting policies and disclosures
There are no new standards and amendments to IFRS effective as
of January 1, 2021 that are relevant to the Group.
Critical accounting judgements and key sources of estimation
uncertainty
In preparing these condensed consolidated interim financial
statements in conformity with IFRS management is required to make
judgements, estimates and assumptions that affect the application
of policies and amounts reported in the condensed consolidated
interim 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, 2020.
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, 2020.
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,
being the pharmaceutical sector with high unmet medical need.
The Group's Chief Executive Officer, Joseph Wiley, is currently
the Company'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.
Three months ended June 30, 2021 (unaudited)
U.S. EMEA Other Total
US$'000 US$'000 US$'000 US$'000
Metreleptin 17,739 11,005 14,315 43,059
Lomitapide 8,490 7,492 3,468 19,450
Other -- 193 60 253
Total revenue 26,229 18,690 17,843 62,762
Three months ended June 30, 2020 (unaudited)
U.S. EMEA Other Total
US$'000 US$'000 US$'000 US$'000
Metreleptin 14,666 11,182 2,051 27,899
Lomitapide 9,344 6,341 2,367 18,052
Other -- 146 88 234
Total revenue 24,010 17,669 4,506 46,185
Six months ended June 30, 2021 (unaudited)
U.S. EMEA Other Total
US$'000 US$'000 US$'000 US$'000
Metreleptin 33,978 23,976 15,065 73,019
Lomitapide 16,814 14,932 5,888 37,634
Other -- 416 125 541
Total revenue 50,792 39,324 21,078 111,194
Six months ended June 30, 2020 (unaudited)
U.S. EMEA Other Total
US$'000 US$'000 US$'000 US$'000
Metreleptin 29,580 19,810 5,436 54,826
Lomitapide 18,814 11,574 5,085 35,473
Other -- 372 88 460
Total revenue 48,394 31,756 10,609 90,759
Major Customers
For the three and six months ended June 30, 2021, one customer
accounted for 42% and 45.7%, respectively, of the Group's net
revenues (2020: 52% and 53%, respectively) and accounted for 42% of
the Group's June 30, 2021 accounts receivable balance (December 31,
2020: 42%).
4. Share based payments
Under the terms of the Company's Employee Share Option Plan,
options to purchase 27,304,867 shares were outstanding at June 30,
2021. 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 8,872,369 share options
were granted to employees in the six-month period ended June 30,
2021. For the year ended December 31, 2020, a total of 4,432,000
share options were granted to directors and employees.
The terms and conditions of the grants are as follows, whereby
all options are settled by physical delivery of shares:
Vesting conditions
The employee share options vest following a period of service by
the officer or employee. The required period of service is
determined by the Remuneration Committee at the date of grant of
the options (usually the date of approval by the Remuneration
Committee). There are no market conditions associated with the
share option vesting periods.
Contractual life
The term of an option is determined by the Remuneration
Committee provided that the term may not exceed a period of seven
to ten years from the date of grant. All options will terminate 90
days after termination of the option holder's employment, service
or consultancy with the Group except where a longer period is
approved by the Board of Directors. Under certain circumstances
involving a change in control of the Group, some options will
automatically accelerate and become exercisable in full as of a
date specified by the Board of Directors.
Outstanding warrants at June 30, 2021 consisted of 8,966,520
zero cost warrants (December 31, 2020: 8,966,520) with no
expiration date that were issued to Aegerion creditors in
connection with the acquisition of Aegerion. Separate warrants
consisting of 345,542 as at December 31, 2020, which were issued in
connection with the admission to the AIM in 2016, are no longer
outstanding; 283,389 warrants were exercised in March 2021 and
62,153 warrants lapsed in April 2021.
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 average Weighted average
exercise price exercise price
(Sterling (Sterling
Units pence) Units pence)
Balance at 1 January 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 31 December 2020
(audited) 18,753,648 122.79p 9,312,062 0.05p
Exercisable at 31 December 2020
(audited) 5,866,152 114.24p 9,312,062 0.05p
Balance at 1 January 2021 18,753,648 122.79p 9,312,062 0.05p
Granted 8,872,369 201.13p -- --
Lapsed (21,150) 201.17p (62,153) 1.44p
Exercised (300,000) 93.72p (283,389) 1.44p
Outstanding at June 30, 2021
(unaudited) 27,304,867 148.51p 8,966,520 0.01p
Exercisable at June 30, 2021
(unaudited) 6,502,551 114.61p 8,966,520 0.01p
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:
June 30, June 30, December 31, December 31,
2021 2021 2020 2020
Options Inputs Warrant Inputs Options Inputs Warrant Inputs
(unaudited) (unaudited) (audited) (audited)
Days to
Expiration 2,555 -- 2,555 --
Volatility 37% -- 33% - 37% --
Risk free 0.77% -- 0.39% - 0.46% --
interest
rate
Share price 201.2p -- 123.5p -178.9p --
at grant
In the six months ended June 30, 2021, a total of 8,872,369
share options over ordinary shares exercisable at a weighted
average price of GBP2.012 were granted. The fair value of share
options granted in the six months ended June 30, 2021 was
GBP17,845,000/US$24,617,000.
The share options outstanding as at June 30, 2021 have a
weighted remaining contractual life of 5.55 years with exercise
prices ranging from GBP0.76 to GBP2.012 per ordinary share.
Restricted Share Units
Under the terms of the Company's Employee Share Option Plan,
restricted share units ("RSUs") to purchase 1,960,570 ordinary
shares were outstanding at June 30, 2021. Under the terms of this
plan, RSUs are granted to officers, consultants and employees of
the Group at the discretion of the Remuneration Committee. For the
period ended June 30, 2021, a total of 455,870 RSUs were granted to
employees of the company. For the year ended December 31, 2020, a
total of 1,556,960 RSUs were granted to employees of the company.
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 period ended June 30, 2021 was
US$1,272,000. At June 30, 2021, the total RSUs granted to date have
a weighted remaining contractual life of 2.2 years.
The following table summarizes the RSU activity for the
period:
RSUs
Number of ordinary Weighted average
shares fair value (US$)
-----------------
Balance at January 1, 2021 1,549,910 $2.35
Granted 455,870 $2.79
Lapsed (45,210) $2.41
Vested -- --
Outstanding at June 30, 2021 1,960,570 $2.44
The value of share options and RSU's charged to the Condensed
Consolidated Statement of Comprehensive Loss during the period is
as follows:
Three months ended Six months ended
June 30, June 30,
-------------------------- --------------------------
2021 2020 2021 2020
(unaudited) (unaudited) (unaudited) (unaudited)
------------ ------------
US$'000 US$'000 US$'000 US$'000
Share option
expense 1,473 858 2,352 1,603
RSU expense 480 -- 864 --
Total share
option expense 1,953 858 3,216 1,603
5. Business combinations and asset acquisitions
Acquisition of Aegerion Pharmaceuticals
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 Pharmaceuticals, Inc.
("Aegerion"), a former wholly-owned subsidiary of Novelion
Therapeutics Inc. ("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 Company believes that the acquisition of Aegerion has
enabled the Group to advance the Group's ambition to create a
global leader in rare and orphan diseases with a diversified
offering of multiple development-stage and commercial assets and
provides it with scale to support further growth.
As part of the acquisition of Aegerion, it was agreed, for
certain Aegerion creditors who wished to restrict their percentage
share interest in Amryt's issued share capital, to issue to the
relevant Aegerion creditor, as an alternative to Amryt's ordinary
shares, an equivalent number of new zero cost warrants to subscribe
for Amryt's ordinary shares to be constituted on the terms of the
zero cost warrant.
Relevant Aegerion creditors are entitled at any time to exercise
the zero cost warrants, at which point in time, the Company would
issue to that Aegerion creditor the relevant number of fully paid
ordinary shares in return for the exercise of the zero cost
warrants. Each zero cost warrant entitles the holder thereof to
subscribe for one ordinary share. The zero cost warrants constitute
the Company's direct and unsecured obligations and rank pari passu
and without any preference among themselves (save for any
obligations to be preferred by law) at least equally with the
Company's other present and future unsecured and unsubordinated
obligations. The zero cost warrants are not transferable except
with the Company's prior written consent.
During the three-month and six-month periods ended June 30,
2021, the Group incurred no additional acquisition and
restructuring related costs relating to external legal fees,
advisory fees, due diligence costs and severance costs (June 30,
2020: US$47,000 and US$853,000, respectively ). These costs were
included in operating costs in the Condensed Consolidated Statement
of Comprehensive loss.
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 optionholders, 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
Oleogel-S10, 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 optionholders 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 Oleogel-S10 (the Group's lead development asset)
-- 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 Oleogel-S10 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. The CVRs have been classified as a financial
liability in the Condensed Consolidated Statement of Financial
Position. 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 June 30, 2021, the carrying value of the CVRs was
US$65,017,000 (December 31, 2020: US$61,417,000). 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. The market-based probability chance
of success is based on market benchmarks for orphan drugs was
estimated at 89% in the period ended June 30, 2021 (2020: 89%).
Discount rates of 10% and 16.5%, as applicable, were used in the
calculation of the present value of the estimated contractual cash
flows for the period ended June 30, 2021 (December 31, 2020: 10%
and 16.5%). Management was required to make certain estimates and
assumptions in relation to revenue forecasts, timing of revenues
and probability of achievement of commercialization of Oleogel-S10.
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 assessment
of 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 Condensed 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 in the Condensed
Consolidated Statement of Comprehensive Loss on a quarterly basis.
The Group received positive topline data from the phase 3 EASE
trial of Oleogel-S10 in September 2020. The Group recently
submitted 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 six
months ended June 30, 2021 is US$1,837,000 and US$3,600,000 (June
30, 2020: US$1,493,000 and US$2,941,000, respectively).
Acquisition of Amryt GmbH (previously "Birken")
Amryt DAC signed a conditional share purchase agreement to
acquire Amryt GmbH on October 16, 2015 ("Amryt GmbH SPA"). The
Amryt GmbH 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 of Episalvan;
-- 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 of Oleogel
S-10 first exceed EUR50,000,000 in any calendar year;
-- EUR15,000,000 once net ex-factory sales/ net revenue of Oleogel
S-10 first exceed EUR100,000,000 in any calendar year;
-- Cash consideration of EUR150,000, due and paid on the completion date
(April 18, 2016); and
-- Royalties of 9% on sales of Oleogel-S10 products for 10 years from first
commercial sale.
Fair Value Measurement of Contingent Consideration
As at June 30, 2021, the fair value of the contingent
consideration was estimated to be US$90,059,000 (December 31, 2020:
US$86,906,000). 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 and impact of key unobservable impact data). 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. The
market-based probability chance of success is based on market
benchmarks for orphan drugs was estimated at 89% for the period
ended June 30, 2021 (December 31, 2020: 89%) following the positive
results from our phase 3 EASE trial of Oleogel-S10 earlier in the
year. A discount rate of 14.4% was used in the calculation of the
fair value of the contingent consideration for the three months
ended June 30, 2021 (December 31, 2020: 14.4%).
The Group received positive top line results from the phase 3
EASE trial of Oleogel-S10 in September 2020, and the Group recently
submitted applications for approval from the FDA and the EMA.
Amryt reviews the contingent consideration on a regular basis as
the probability adjusted fair values are being unwound as financing
expenses in the Condensed Consolidated Statement of Comprehensive
Loss over the life of the obligation. The finance charge is being
unwound as a financing expense in the Condensed Consolidated
Statement of Comprehensive Loss on a quarterly basis.
The total non-cash finance charge recognized in the Condensed
Consolidated Statement of Comprehensive Loss for the three and six
months ended June 30, 2021 is US$2,993,000 and US$5,867,000 (June
30, 2020: US$3,118,000 and US$6,024,000, respectively).
6. Loss per share - basic and diluted
The weighted average number of shares in the loss per share
("LPS") calculation, reflects the weighted average total actual
shares of Amryt Pharma plc in issue at June 30, 2021.
Issued share capital - ordinary shares of GBP0.06 each
Number of shares Weighted average shares
---------------- ------------------------------------
As at Three months ended Six months ended
June 30, June 30, June 30,
----------------
2021 (unaudited) 179,384,982 179,384,982 179,162,585
2020 (unaudited) 154,498,887 154,498,887 154,498,887
The calculation of loss per share is based on the following:
Three months ended Six months ended
June 30, June 30,
2021 2020 2021 2020
(unaudited) (unaudited) (unaudited) (unaudited)
Loss after tax attributable to
equity holders of the Company
(US$'000) (6,799) (18,169) (23,336) (47,066)
Weighted average number of ordinary
shares in issue 179,384,982 154,498,887 179,162,585 154,498,887
Fully diluted average number
of ordinary shares in issue 179,384,982 154,498,887 179,162,585 154,498,887
Basic and diluted loss per share
(US$) (0.04) (0.12) (0.13) (0.30)
Where a loss has occurred, basic and diluted LPS are the same
because the outstanding share options and warrants are
anti-dilutive. Accordingly, diluted LPS equals the basic LPS. The
share options and warrants outstanding as at June 30, 2021 totaled
36,271,387 (June 30, 2020: 34,623,416) and are potentially
dilutive.
7. Intangible assets and goodwill
The following table summarizes the Group's intangible assets and
goodwill:
Developed Developed
technology technology In process Other intangible Total intangible
- metreleptin - lomitapide R&D assets assets Goodwill
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Cost
At January 1, 2020
(audited) 176,000 123,000 54,261 701 353,962 19,131
Additions -- -- -- 372 372 --
Acquired assets -- -- 591 -- 591 --
Disposals -- -- -- (246) (246) --
Foreign exchange movement -- -- 5,276 39 5,315 --
At December 31, 2020
(audited) 176,000 123,000 60,128 866 359,994 19,131
Additions -- -- -- 722 722 --
Foreign exchange movement -- -- (1,852) (22) (1,874) --
At June 30, 2021
(unaudited) 176,000 123,000 58,276 1,566 358,842 19,131
Accumulated amortization
At January 1, 2020
(audited) 7,314 4,143 -- 178 11,635 --
Amortization charge 27,429 15,537 -- 202 43,168 --
Accumulated amortization
on disposals -- -- -- (246) (246) --
Foreign exchange movement -- -- -- 68 68 --
At December 31, 2020
(audited) 34,743 19,680 -- 202 54,625 --
Amortization charge 13,714 7,768 -- 38 21,520 --
Foreign exchange movement -- -- -- 21 21 --
At June 30, 2021
(unaudited) 48,457 27,448 -- 261 76,166 --
Net book value
At December 31, 2020
(audited) 141,257 103,320 60,128 664 305,369 19,131
At June 30, 2021
(unaudited) 127,543 95,552 58,276 1,305 282,676 19,131
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 4.7 and 6.2 years,
respectively, as of June 30, 2021 (December 31, 2020: 5.2 and 6.7
years, respectively).
In-process R&D
As a result of the acquisition of Amryt GmbH, in 2016, the Group
recognized in-process R&D costs of EUR48,453,000/US$57,683,000
which is related to the Group's lead development asset,
Oleogel-S10. The remaining in-process R&D is a result of the
acquisition of Cala Medical Limited in October 2020.
Goodwill
During 2019, the Group completed the acquisition of Aegerion,
which resulted in aggregate goodwill of US$19,131,000.
The Group reviews events or changes in circumstances that may
indicate a triggering event for impairment. Management applied its
judgment in determining that there were no events or changes in
circumstances causing any impairment triggers as of June 30, 2021.
As such there was no impairment charge recorded during the three
and six months ended June 30, 2021.
8. Trade and other receivables
As at
June 30, December 31,
2021 2020
(unaudited) (audited)
------------
US$'000 US$'000
Trade receivables 36,632 33,057
Accrued income and other debtors 4,557 8,423
VAT recoverable 317 1,705
Trade and other receivables 41,506 43,185
9. Cash and cash equivalents
As at
June 30, December 31,
2021 2020
(unaudited) (audited)
------------
US$'000 US$'000
Cash at bank available on demand 142,946 118,575
Restricted cash -- 223
Total cash and cash equivalents 142,946 118,798
Cash and cash equivalents include cash at bank available on
demand and restricted cash.
At June 30, 2021 there was nil restricted cash (December 31,
2020: US$223,000). The balance at December 31, 2020 includes a
deposit on a company credit card facility for an amount of
US$150,000. This was reduced to nil as at June 30, 2021.
10. Share capital and reserves
Details of the number of issued ordinary shares with a nominal
value of Sterling 6 pence (2020: 6 pence) each are in the table
below.
Ordinary Treasury
Shares Shares Total
At January 1, 2020 154,498,887 4,864,656 159,363,543
Issue of shares in exchange for
warrants 8,229,753 -- 8,229,753
Issue of shares in equity fund
raises 16,000,000 -- 16,000,000
Issue of treasury shares for share
options exercised 72,953 (72,953) --
At December 31, 2020 (audited) 178,801,593 4,791,703 183,593,296
Issue of treasury shares in exchange
for warrants 283,389 (283,389) --
Issue of treasury shares of share
options exercised 300,000 (300,000) --
At June 30, 2021 (unaudited) 179,384,982 4,208,314 183,593,296
The components of equity are detailed in the Condensed
Consolidated Statement of Changes in Equity and described in more
detail below.
The total number of ordinary shares issued at June 30, 2021 of
183,593,296 (December 31, 2020: 183,593,296), includes treasury
shares of 4,208,314 (December 31, 2020: 4,791,703).
In December 2020, the Company issued 3,200,000 American
Depositary Shares ("ADSs"), each representing five ordinary shares,
as part of a US$40,000,000 private placement equity raise to
existing and new shareholders.
On March 11, 2021, the Company issued 300,000 ordinary shares
from treasury shares following the exercise of share options. On
March 11, 2021, the Company issued 283,389 ordinary shares from
treasury shares in exchange for certain warrants. The Company
issued 4,000,000 and 4,229,753 ordinary shares on July 15, 2020 and
September 22, 2020, respectively, in exchange for certain
warrants.
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 additional warrants issued to
certain shareholders on November 14, 2019. Each warrant entitles
the holder to subscribe for one ordinary share at zero cost. The
Company issued 4,000,000 and 4,229,753 ordinary shares on July 15,
2020 and September 22, 2020, respectively, in exchange for certain
warrants.
Treasury Shares
In October 2020, the Company issued 72,953 ordinary shares from
treasury shares following the exercise of share options. In March
2021, the Company issued a total of 583,389 ordinary shares from
treasury shares, 300,000 ordinary shares relating to the exercise
of share options and 283,389 ordinary shares following the exchange
of certain warrants.
Share based payment reserve
Share based payment reserve relates to the charge for share
based payments in accordance with IFRS 2. In March 2021, the
Company issued 300,000 and 283,389 ordinary shares for share
options exercised and in exchange for certain warrants,
respectively. In April 2021, 62,153 warrants lapsed.
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 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 6 November 2019 of
US$268,505,000. By special resolution of the Company duly passed on 23
September 2019, it was resolved that the entire amount outstanding to the
credit of the share premium account and capital redemption reserve of the
Company be cancelled. The reduction in capital, amounting to
US$268,505,000, representing the entire amount of share premium at that
time, was approved by the High Court of Justice of England and Wales on 5
November 2019.
-- A deemed distribution of US$47,902,000 arising from the issuance of
CVRs.
-- A deemed distribution of US$2,969,000 arising from the scheme of
arrangement in September 2019 whereby Amryt Pharma plc, which was
incorporated in July 2019, became a 100% shareholder of Amryt Pharma
Holdings Limited (formerly named Amryt Pharma plc) (the "Acquisition of
subsidiary without a change of control")
Currency translation reserve
The currency translation reserve arises on the retranslation of
non-U.S. dollar denominated foreign subsidiaries.
Accumulated deficit
Accumulated deficit represents losses accumulated in previous
periods and the current year.
11. Long term loan
As at
June 30, December 31,
2021 2020
(unaudited) (audited)
------------
US$'000 US$'000
Long term loan principal 90,942 88,037
Unamortized debt issuance costs (669) (735)
Long term loan 90,273 87,302
============ ============
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. Unpaid accrued interest of US$1,470,000 as at June
30, 2021 is recognized in current liabilities with trade and other
payables (December 31, 2020: $1,439,000). 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.
In connection with the Term Loan, the Group incurred
approximately US$870,000 of debt issuance costs, which primarily
consisted of underwriting, legal and other professional fees. These
costs are being amortized over the expected life of the loan using
the effective interest method.
The Term Loan is guaranteed by Amryt and certain subsidiaries of
the Group. In connection with the loan agreement, fixed and
floating charges have been placed on property and undertakings of
Amryt and certain subsidiaries of the Group.
The Term Loan agreement includes affirmative and negative
covenants, including prohibitions on the incurrence of additional
indebtedness, granting of liens, certain asset dispositions,
investments, and restricted payments, in each case, subject to
certain exceptions set forth in the Loan Agreement. The Term Loan
agreement also includes customary events of default for a
transaction of this type and includes (i) a cross-default to the
occurrence of any event of default under material indebtedness of
Aegerion and certain subsidiaries of the Group and Amryt, including
the convertible notes, and (ii) Amryt or any of its subsidiaries
being subject to bankruptcy or other insolvency proceedings. Upon
the occurrence of an event of default, the lenders may declare all
of the outstanding Term Loan and other obligations under the Term
Loan agreement to be immediately due and payable and exercise all
rights and remedies available to the lenders under the Term Loan
agreement and related documentation. There have been no events of
default or breaches of the covenants occurring for the three and
six months ended June 30, 2021 (December 31, 2020: no events).
12. Convertible notes
Total
-------
US$'000
At January 1, 2020 96,856
Accreted interest 4,230
At December 31, 2020 (audited) 101,086
Accreted interest 2,289
At June 30, 2021 (unaudited) 103,375
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$1,000 principal amount, at the option of
the holder.
The indenture does not contain any financial covenants or
restrict the Group's ability to repurchase securities, pay
dividends or make restricted payments in the event of a transaction
that substantially increases the Group's level of indebtedness in
certain circumstances.
The indenture contains customary terms and covenants and events
of default. If an event of default (other than certain events of
bankruptcy, insolvency or reorganization involving Aegerion, Amryt
and certain subsidiaries of the Group) occurs and is continuing,
the trustee by notice to Aegerion, or the holders of at least 25%
in principal amount of the outstanding convertible notes by written
notice to Aegerion and the trustee, may declare 100% of the
principal of and accrued and unpaid interest, if any, on all of the
convertible notes to be due and payable. Upon such a declaration of
acceleration, such principal and accrued and unpaid interest, if
any, will be due and payable immediately. Upon the occurrence of
certain events of bankruptcy, insolvency or reorganization
involving Aegerion, 100% of the principal and accrued and unpaid
interest, if any, on the convertible notes will become due and
payable automatically. Notwithstanding the foregoing, the indenture
provides that, upon Aegerion's election, and for up to 180 days,
the sole remedy for an event of default relating to certain
failures by Aegerion to comply with certain reporting covenants in
the indenture consists exclusively of the right to receive
additional interest on the convertible notes. There have been no
events of default or breaches of the covenants occurring for the
period ended June 30, 2021 (2020: no events).
13. Provisions and other liabilities
As at
June 30, December 31,
2021 2020
(unaudited) (audited)
------------
US$'000 US$'000
Non-current liabilities
Provisions and other liabilities 22,494 21,382
Leases due greater than 1 year 4,360 4,569
26,854 25,951
Current liabilities
Provisions and other liabilities 6,000 9,976
Leases due less than 1 year 948 963
6,948 10,939
Total provisions and other liabilities 33,802 36,890
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.
Subsequent to the acquisition, Aegerion made US$23,036,000 of
settlement payments, including interest. The settlements have been
paid in full with the last payment completed in Q1 2021. There is
no current liability recognized as at June 30, 2021 (December 31,
2020: US$3,976,000). There is no non-current liability at June 30,
2021 (December 31, 2020: nil).
Other 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 June 30, 2021 the
Group had recognized liabilities of US$6,000,000 in relation to
ongoing legal matters (December 31, 2020 US$6,000,000).
14. Fair value measurement and financial risk management
Categories of financial instruments
As at
June 30, December 31,
2021 2020
(unaudited) (audited)
------------
US$'000 US$'000
Financial assets (all at amortized cost):
Cash and cash equivalents 142,946 118,798
Trade receivables 36,632 33,057
Total financial assets 179,578 151,855
Financial liabilities:
At amortized cost
Trade payables and accrued expenses 93,897 89,300
Lease liabilities 5,308 5,532
Other liabilities 22,494 25,358
Convertible notes 103,375 101,086
Long term loan 90,273 87,302
Contingent value rights 65,017 61,417
At fair value
Contingent consideration 90,059 86,906
Total financial liabilities 470,423 456,901
Net (290,845) (305,046)
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$90,059,000 as at June 30, 2021 (December 31, 2020: US$86,906,000).
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. It also included a revision to the discount rate used,
and revenue and costs forecasts have been amended to reflect management's
current expectations.
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$6,300,000. 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$14,634,000. A decrease of 5% would result in an
increase to the fair value of US$19,265,000.
-- A six-month delay in the launch date for Oleogel-S10 would result in a
decrease to the fair value of US$8,994,000.
15. Events after the reporting period
Mergers and acquisitions
On May 5, 2021, Amryt announced that it had signed a definitive
agreement to acquire Chiasma, Inc. ("Chiasma") in an all-stock
combination. The combined company will be a global leader in rare
and orphan diseases with three on-market commercial products, a
global commercial and operational footprint and a significant
development pipeline of therapies with the financial flexibility to
execute its growth plans. On August 5, 2021, Amryt announced that
it has completed its acquisition of Chiasma, Inc. following the
receipt of the necessary approvals of both Amryt's and Chiasma's
shareholders. In conjunction with completion, Amryt also announced
the appointment of Raj Kannan and Roni Mamluk Ph.D to the board of
Amryt as Non-Executive Directors with immediate effect.
Amryt has allotted and issued a total of 127,733,680 new
ordinary shares as consideration for the Transaction which will be
issued to the former Chiasma Shareholders in the form of 25,546,736
Amryt ADSs which are tradeable on Nasdaq.
Exercise of Warrants & Issue of Ordinary Shares
On August 5, 2021, the Company announced that an institutional
investor exercised subscription rights relating to 8,966,520 zero
cost warrants. These warrants were issued in September 2019 as part
of the Company's acquisition of Aegerion. In order to satisfy the
exercise of the Warrants, the Company will transfer 4,208,314
Ordinary Shares out of treasury and will issue 4,758,206 new
Ordinary Shares to the institutional investor
There were no other significant events since the end of the
reporting period.
(END) Dow Jones Newswires
August 06, 2021 07:00 ET (11:00 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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