TORONTO, Aug. 18, 2016 (GLOBE NEWSWIRE) -- Profound Medical Corp. (“Profound” or the “Company”) (TSXV:PRN), an emerging medical device company focused on prostate cancer care, today reported financial results for the three months ended June 30, 2016. All amounts, unless specified otherwise, are expressed in Canadian dollars and are presented in accordance with International Financial Reporting Standards.
“The second quarter of 2016 was characterized by the achievement of a number of significant strategic and commercial milestones,” said Steve Plymale, Profound’s President & COO. “These included the receipt of CE Mark approval, followed closely by the world’s first sale of a TULSA-PRO™ System in Spain. Profound also signed a major strategic collaboration with Royal Philips for sales and marketing of TULSA-PRO™ which has already resulted in the sale of two additional TULSA-PRO™ systems in Europe. Finally, the Company was granted IDE approval from the FDA for a multicenter Pivotal Clinical Trial to evaluate the efficacy of the TULSA-PRO™ System in patients with localized prostate cancer.”
“Steve and the rest of the management team did an excellent job of meeting Profound’s key objectives in Q2. I look forward to working with everyone to accelerate the building of the Company even further,” said Arun Menawat, who was appointed as Profound’s new CEO subsequent to the end of the 2016 second quarter.
Corporate Highlights
- On May 11, 2016, Profound announced a sales and marketing agreement with Royal Philips. Under the terms of the agreement, the Company and Royal Philips will collaborate on the commercialization of the TULSA-PRO™ system in Europe, followed by Canada, the United States and other markets, subject to regulatory clearance in those jurisdictions.
- On May 19, 2016, the Company announced that it had been granted Investigational Device Exemption, or IDE, approval from the FDA for a multicenter Pivotal Clinical Trial, designed to evaluate the efficacy of the TULSA-PRO™ System in patients with localized prostate cancer.
- On June 20, 2016, Profound announced the first sale of the TULSA-PRO™ system in the United Kingdom to University College London and University College London Hospitals NHS Foundation Trust. This marked the first sale under the Company’s collaboration with Royal Philips.
- On June 21, 2016, the Company announced the first sale of the TULSA-PRO™ system in Germany to University Hospital of Cologne, also resulting from the collaboration with Royal Philips.
- On August 15, 2016, Profound announced the appointment of Arun Menawat, Ph.D. as its new Chief Executive Officer. Steven Plymale, Profound’s current Chief Executive Officer, has transitioned to President and Chief Operating Officer of Profound. Rashed Dewan has also been promoted from Corporate Controller to Vice President, Finance.
Summary Second Quarter 2016 Results
The Company recorded a net loss for the three months ended June 30, 2016 of $3,640,725 or $0.09 per common share, compared with a net loss of $8,698,717 for the three months ended June 30, 2015. For the three months ended June 30, 2016, the net loss was primarily attributed to R&D expenses of $2,247,697, SG&A expenses of $1,182,177 and interest and accretion expense of $254,145 offset by the interest income of $47,951. For the three months ended June 30, 2015, the net loss was higher as a result of certain finance costs including the listing expense of $2,058,234 in connection with the Company’s going public transaction, interest and accretion expense of $4,764,823 primarily related to acceleration of accretion on the Company’s preferred shares at the time of their conversion to common shares, these amounts were partially offset by a gain on the conversion of convertible notes in the amount of $1,759,885. In addition to the finance costs the Company incurred, R&D expenses of $1,105,381, and SG&A expenses of $3,393,128.
Expenditures for R&D for the three months ended June 30, 2016 were higher by $1,142,316 compared to the three months ended June 30, 2015. The increase was primarily due to the activities in preparing regulatory filings for marketing approval of TULSA-PRO in Canada and preparation for the initiation of the multi-jurisdictional Pivotal Trial. Preparations for the Pivotal Trial include contract set-up, site validation and organizing the IDE submission in approximately 15 clinical sites, designed to support a 510(k) submission in the United States to provide a pathway for Class II classification for the TULSA-PRO system. As a result material costs, consulting expense and validation expense for clinical trials increased by a total of $441,173. The number of employees involved in R&D also increased during this period to support these activities resulting in salaries and benefits increasing by $391,928. In addition, our investment tax credits have declined in the three months ended June 30, 2016 compared to the same period in the prior year. The Company no longer qualifies for certain refundable investment tax credits since becoming public on June 4, 2015.
SG&A expenses for the three months ended June 30, 2016 were lower by $2,210,951 compared to the three months ended June 30, 2015, primarily due to marketing expense of $2,303,034 related to the excess of proceeds received on the $4,000,000 secured loan from Knight Therapeutics Inc. (“Knight Loan”), which represented additional value as a result of the Knight relationship. Professional and consulting fees increased by $100,290 primarily related to higher director’s fees, and legal expenses in connection with contracts and corporate matters.
Liquidity and Outstanding Share Capital
The Company had cash and short-term investments of $12,972,142 as at June 30, 2016 compared to $20,522,520 as at December 31, 2015. The decrease in cash and short-term investments during the six months ended June 30, 2016 is mainly a result of the cash used in operating activities.
As at August 16, 2016, Profound had an unlimited number of authorized common shares with 39,485,577 common shares issued and outstanding.
For complete financial results, please see our filings at www.sedar.com and our website at www.profoundmedical.com.
Conference Call Details
Profound Medical is pleased to invite all interested parties to participate in a conference call on, August 22, 2016 at 8:30 a.m. EDT during which time the results will be discussed.
Live Participant Dial in (Toll Free): 1-877-407-9210
Live Participant Dial in (International): 1-201-689-8049
Conference ID #: 13641944
Replay Number (Toll Free): 1-877-481-4010
Replay Number (International): 1-919-882-2331
Replay ID: 10061
About Profound Medical Corp.
Profound Medical is an emerging medical device company that has developed a unique and minimally invasive procedure, MRI-Guided TULSA, to ablate malignant prostate tissue. The Company’s novel technology, TULSA-PROTM, combines real-time Magnetic Resonance imaging with transurethral, robotically-driven therapeutic ultrasound and closed-loop thermal feedback control. It provides a highly precise treatment tailored to patient-specific anatomy and pathology. This method of prostate ablation offers short treatment times and low morbidity, allowing for fast patient recovery. For more information, visit www.profoundmedical.com.
Notice regarding forward-looking statements:
This release includes forward-looking statements regarding Profound and its business which may include, but is not limited to, the expectations regarding the efficacy of Profound’s technology in the treatment of prostate cancer. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "is expected", "expects", "scheduled", "intends", "contemplates", "anticipates", "believes", "proposes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations of the management of each entity. The forward-looking events and circumstances discussed in this release, may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the company, including risks regarding the pharmaceutical industry, economic factors, the equity markets generally and risks associated with growth and competition. Although Profound has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Profound undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, other than as required by law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.