OvaScience Reports First Quarter 2015 Financial Results
“We are confident in our ability to achieve our goals this year as
demand for the AUGMENT treatment grows and we make progress toward
bringing other new options to patients,” said
Dr. Dipp added, “This year, we are focused on expanding the availability of our AUGMENT treatment internationally, preparing to introduce the OvaPrime treatment to patients, and defining the OvaTure treatment development pathway. Our financial position is strong, the team continues to execute, and we remain driven to deliver new treatments to women struggling with infertility.”
First Quarter and Recent Highlights
Announced the First Baby Born Following the AUGMENTSM
The first baby was born healthy following the AUGMENT treatment in
Toronto, Ontario, Canada. The AUGMENT treatment is the first treatment offered to patients based on the Company’s egg precursor (EggPCSM) cell technology. It is specifically designed to improve egg health in women undergoing in vitro fertilization (IVF). Improved egg health is essential for embryo development. The AUGMENT treatment is not available in the United States.
IVF Specialists Reported Initial, Positive Clinical Experiences
with the AUGMENT Treatment
Positive clinical experiences with the AUGMENT treatment were presented at the
Society for Reproductive Investigation(SRI) Annual Meeting by Robert F. Casper, M.D., F.R.C.S.(C), Medical Director of TCART Fertility Partners of Toronto, Canada, and Kutluk Oktay, M.D., F.A.C.O.G, of Gen-art IVF in Ankara, Turkey. Both physicians reported ongoing clinical pregnancies in women who had poor embryo development and failed to have successful pregnancies after multiple IVF cycles and embryo transfers (an IVF cycle can consist of multiple, subsequent embryo transfers). Importantly, many women in Dr. Casper’s clinic have frozen embryos that can be used for future embryo transfers, thus increasing the potential for additional pregnancies.
On Track to Meet 2015 AUGMENT Cycles Goal
OvaSciencecontinued transitioning certain IVF clinics to commercial centers and anticipates meeting the Company’s own limit of 1,000 AUGMENT treatment cycles in process by the end of the year. This goal reflects OvaScience’s commitment to delivering the highest quality treatments, while building a solid foundation from which to scale and support the introduction of future treatments, which will utilize the same EggPC technology and lab-based infrastructure.
Preparing to Introduce the OvaPrimeSM
Treatment to Patients Internationally
Optimization of the Company’s OvaPrime treatment is moving forward and the Company is on track to introduce it to patients in at least one international region outside of
the United Statesby the end of 2015. The OvaPrime treatment utilizes a woman’s own EggPC cells to increase her egg reserve for IVF; approximately 25-30% of women make too few or no eggs and cannot go through IVF.
Defining the Development Pathway for the OvaTureSM
Treatment, a Potential Hormone-Free Fertility Option
OvaSciencecontinues to optimize the OvaTure process and plans to define a development pathway by the end of 2015. The OvaTure treatment is a potential next-generation IVF treatment that could help a woman produce healthy, young, fertilizable eggs without hormone injections.
Strengthened Board of Directors with Appointment of
John Sexton, President of New York University John E. Sexton, Ph.D., President of NYU, joined OvaScience’s Board of Directors, bringing extensive expertise and leadership abilities as demonstrated by his success in building and maintaining thriving international operations.
First Quarter Financial Results
Net loss for the three months ended
March 31, 2015was $17.2 million, or ($0.65)per share, as compared to net loss of $7.8 million, or ($0.41)per share, for the three months ended March 31, 2014. This included non-cash stock-based compensation expense of $6.4 milliondue in large part to accounting of certain Founders’ stock. The increase is primarily attributable to stock-based compensation, planned higher personnel costs, and costs associated with the launch of the AUGMENT treatment in certain international IVF clinics. Launch costs include the establishment of lab-based operations, personnel, and legal and consulting services, which will support the introduction of future fertility treatments, including the OvaPrime treatment this year and the OvaTure treatment over time.
December 2014, the Company commenced the first commercial AUGMENT treatment but did not recognize the associated revenue from that cycle until the first quarter of 2015. In the first quarter, the Company performed additional commercial AUGMENT treatment cycles for which the Company received cash and expects to recognize the associated revenue over the coming quarters. As previously stated, OvaSciencegenerally expects a delay in revenue recognition of approximately 30-120 days due to the typical timing for a standard IVF cycle.
Research and development expense for the three months ended
March 31, 2015was $5.7 million, compared to $4.7 millionfor the same period in 2014. The increase was primarily the result of incremental non-cash stock-based compensation expense of $2.2 millionand decrease of $0.8 millionof license fees related to our MGH license.
Selling, general and administrative expense for the three months ended
March 31, 2015was $11.0 million, as compared to $3.0 millionfor the same period in 2014. This increase was primarily a result of incremental non-cash stock-based compensation expense of $3.3 millionand $4.3 millionof additional planned employee compensation, costs associated with the launch of the AUGMENT treatment in select international regions and professional fees including consulting and marketing.
Upcoming Events and Presentations
Jefferies 2015 Healthcare Conference,
June 1-4in New York, NY
JMP Securities Life Sciences Conference, June 23-24in New York, NY
European Society of Human Reproduction and Embryology (ESHRE) Annual
June 14-17in Lisbon, Portugal
This press release includes forward-looking statements about the Company’s plans for the AUGMENT treatment and its two fertility treatments in development, including statements relating to our plans to introduce the OvaPrime treatment in at least one international region by the end of 2015, our plans to expand the availability of the AUGMENT treatment, our plans to define a development pathway for the OvaTure treatment, expected revenue recognition timing, and our expectation that we will have 1,000 AUGMENT cycles in process by the end of 2015. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including risks related to: the possibility that international IVF clinics that we work with may determine not to begin or continue providing the AUGMENT treatment for commercial or other reasons; our expectation that the AUGMENT treatment and OvaPrime treatment meet the requirements of a class of products exempt from premarket review and approval under applicable regulations in those countries where we have launched or plan to introduce the AUGMENT treatment and plan to introduce the OvaPrime treatment; the commercial ramp up of the AUGMENT treatment, which we expect will depend upon the successful transition of ACE clinics to commercial operations, the addition of new ACE clinics, and the results from ACE clinic experience as they become available; the science underlying our treatment and treatments in development (including the AUGMENT, OvaPrime and OvaTure treatments), which is unproven; our ability to obtain regulatory approval where necessary for our potential treatments; our ability to develop our potential treatments, including the OvaPrime and OvaTure treatments, on the timelines we expect, if at all; our ability to commercialize the AUGMENT treatment and our potential treatments, including the OvaPrime treatment, on the timelines we expect, if at all; as well as those risks more fully discussed in the “Risk Factors” section of our most recently filed Quarterly Report on Form 10-Q and/or Annual Report on Form 10-K. The forward-looking statements contained in this press release reflect our current views with respect to future events. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our view as of any date subsequent to the date hereof.
– Financial Tables to Follow –
Condensed Consolidated Balance Sheets
|Cash and cash equivalents||$||134,698||$||6,414|
|Prepaid expenses and other current assets||1,995||1,647|
|Total current assets||171,334||61,878|
|Property and equipment, net||4,159||3,367|
|Investment in joint venture||196||-|
|Other long-term assets||-||130|
|Liabilities and stockholders’ equity|
|Accrued expenses and other current liabilities||4,116||7,654|
|Total current liabilities||6,609||10,174|
|Other non-current liabilities||74||73|
|Total stockholders’ equity||169,094||55,325|
|Total liabilities and stockholders’ equity||$||175,777||$||65,572|
Three Months Ended
|Costs and expenses:|
|Costs of revenues||35||-|
|Research and development||5,747||4,652|
|Selling, general and administrative||11,046||2,998|
|Total costs and expenses||16,828||7,650|
|Loss from operations||(16,813||)||(7,650||)|
Interest income (expense), net
Other income (expense), net
|Loss from equity method investment||(471||)||(97||)|
|Net loss per share—basic and diluted||
Weighted average number of shares used in net loss