Exhibit 99.1
OBSEVA SA
INDEX TO UNAUDITED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Consolidated Balance Sheet as at March 31, 2017 (unaudited) and December 31, 2016 | 2 | |
Unaudited Consolidated Statement of Comprehensive Loss for the three-month periods ended March 31, 2017 and 2016 | 3 | |
Unaudited Consolidated Statement of Cash Flows for the three-month periods ended March 31, 2017 and 2016 | 4 | |
Unaudited Statement of Changes in Equity for the period from January 1, 2016 to March 31, 2017 | 5 | |
Unaudited Notes to the Consolidated Interim Financial Statements for the three-month period ended March 31, 2017 | 6 |
ObsEva SA
Consolidated Interim Financial Statements
Consolidated Balance Sheet
(in USD ’000) | As at March 31, 2017 | As at December 31, 2016 | ||||||||||
Notes | unaudited | audited | ||||||||||
ASSETS | ||||||||||||
Current assets | ||||||||||||
Cash and cash equivalents | 3 | 104,158 | 25,508 | |||||||||
Other receivables | 988 | 783 | ||||||||||
Prepaid expenses and deferred costs | 1,047 | 2,415 | ||||||||||
|
|
|
| |||||||||
Total current assets | 106,193 | 28,706 | ||||||||||
Non-current assets | ||||||||||||
Plant and equipment | 118 | 121 | ||||||||||
Intangible assets | 4 | 16,608 | 16,608 | |||||||||
Other long-term assets | 171 | 90 | ||||||||||
|
|
|
| |||||||||
Total non-current assets | 16,897 | 16,819 | ||||||||||
|
|
|
| |||||||||
Total assets | 123,090 | 45,525 | ||||||||||
|
|
|
| |||||||||
LIABILITIES AND SHAREHOLDERS EQUITY | ||||||||||||
Current liabilities | ||||||||||||
Other payables and current liabilities | 1,836 | 2,383 | ||||||||||
Accrued expenses | 6,912 | 4,269 | ||||||||||
|
|
|
| |||||||||
Total current liabilities |
| 8,748 | 6,652 | |||||||||
Non-current liabilities | ||||||||||||
Post-employment obligations | 2,859 | 2,832 | ||||||||||
|
|
|
| |||||||||
Total non-current liabilities | 2,859 | 2,832 | ||||||||||
Shareholders’ equity | ||||||||||||
Share capital | 2,240 | 1,740 | ||||||||||
Share premium | 160,260 | 71,966 | ||||||||||
Reserves | 4,120 | 1,934 | ||||||||||
Accumulated losses | (55,137 | ) | (39,599 | ) | ||||||||
|
|
|
| |||||||||
Total shareholders’ equity | 5 | 111,483 | 36,041 | |||||||||
|
|
|
| |||||||||
Total liabilities and shareholders’ equity | 123,090 | 45,525 | ||||||||||
|
|
|
|
The accompanying notes form an integral part of these consolidated interim financial statements.
2
ObsEva SA
Consolidated Interim Financial Statements
Consolidated Statement of Comprehensive Loss
(in USD ’000, except per share data) | Three-month period ended March 31, | |||||||||||
Notes | 2017 | 2016 | ||||||||||
unaudited | ||||||||||||
Other operating income | 6 | 3 | ||||||||||
OPERATING EXPENSES | ||||||||||||
Research and development expenses | 6 | (13,057 | ) | (3,815 | ) | |||||||
General and administrative expenses | (2,745 | ) | (659 | ) | ||||||||
|
|
|
| |||||||||
Total operating expenses | (15,802 | ) | (4,474 | ) | ||||||||
|
|
|
| |||||||||
OPERATING LOSS | (15,796 | ) | (4,471 | ) | ||||||||
|
|
|
| |||||||||
Finance income | 258 | 14 | ||||||||||
Finance expense | — | (224 | ) | |||||||||
|
|
|
| |||||||||
NET LOSS BEFORE TAX | (15,538 | ) | (4,681 | ) | ||||||||
|
|
|
| |||||||||
Income tax expense | — | — | ||||||||||
|
|
|
| |||||||||
NET LOSS FOR THE PERIOD | (15,538 | ) | (4,681 | ) | ||||||||
|
|
|
| |||||||||
Net loss per share | ||||||||||||
Basic | 7 | (0.58 | ) | (0.22 | ) | |||||||
Diluted | 7 | (0.58 | ) | (0.22 | ) | |||||||
OTHER COMPREHENSIVE INCOME | ||||||||||||
Items that will not be reclassified to profit and loss | ||||||||||||
|
|
|
| |||||||||
Remeasurements on post-retirement benefit plans | — | — | ||||||||||
Items that may be reclassified to profit or loss | ||||||||||||
Currency translation differences | — | 2,403 | ||||||||||
|
|
|
| |||||||||
TOTAL OTHER COMPREHENSIVE INCOME | — | 2,403 | ||||||||||
|
|
|
| |||||||||
TOTAL COMPREHENSIVE LOSS FOR THE PERIOD | (15,538 | ) | (2,278 | ) | ||||||||
|
|
|
|
The accompanying notes form an integral part of these consolidated interim financial statements.
3
ObsEva SA
Consolidated Interim Financial Statements
Consolidated Statement of Cash Flows
Three-month period ended March 31, | ||||||||
(in USD ’000) | 2017 | 2016 | ||||||
unaudited | ||||||||
|
|
|
| |||||
NET LOSS BEFORE TAX FOR THE PERIOD | (15,538 | ) | (4,681 | ) | ||||
|
|
|
| |||||
Adjustments for: | ||||||||
Depreciation | 12 | 11 | ||||||
Post-employment benefit | 27 | (12 | ) | |||||
Share-based payments | 2,324 | 216 | ||||||
Finance (income) / expense, net | (258 | ) | 210 | |||||
Increase in other receivables | (205 | ) | (35 | ) | ||||
Decrease / (increase) in prepaid expenses, other long-term assets and deferred costs payable | 1,081 | (802 | ) | |||||
(Decrease) / increase in other payables and current liabilities | (547 | ) | 976 | |||||
Increase / (decrease) in accrued expenses | 2,513 | (664 | ) | |||||
|
|
|
| |||||
NET CASH FLOWS USED IN OPERATING ACTIVITIES | (10,591 | ) | (4,781 | ) | ||||
|
|
|
| |||||
Payments for plant and equipment | (9 | ) | (17 | ) | ||||
|
|
|
| |||||
NET CASH FLOWS USED IN INVESTING ACTIVITIES | (9 | ) | (17 | ) | ||||
|
|
|
| |||||
Proceeds from issue of shares | 96,754 | 2 | ||||||
Share issuance costs | (7,769 | ) | — | |||||
Interest received | — | 14 | ||||||
Interest paid | — | (6 | ) | |||||
|
|
|
| |||||
NET CASH FLOWS FROM FINANCING ACTIVITIES | 88,985 | 10 | ||||||
|
|
|
| |||||
Net increase / (decrease) in cash and cash equivalents | 78,385 | (4,788 | ) | |||||
|
|
|
| |||||
Cash and cash equivalents as at January 1, | 25,508 | 54,275 | ||||||
|
|
|
| |||||
Effects of exchange rate changes on cash and cash equivalents | 265 | 1,633 | ||||||
Cash and cash equivalents as at March 31, | 104,158 | 51,120 | ||||||
|
|
|
|
The accompanying notes form an integral part of these consolidated interim financial statements.
4
ObsEva SA
Consolidated Interim Financial Statements
Consolidated Statement of Changes in Equity
(in USD ’000)
unaudited
| Share capital | Share premium | Share-based payments reserve | Foreign currency translation reserve | Total reserves | Accumulated losses | Total | |||||||||||||||||||||
January 1, 2016 | 1,694 | 99,597 | 3,227 | (406 | ) | 2,821 | (39,437 | ) | 64,675 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Loss for the period | — | — | — | — | — | (4,681 | ) | (4,681 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Other comprehensive income | — | — | — | 2,403 | 2,403 | — | 2,403 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total comprehensive loss | — | — | — | 2,403 | 2,403 | (4,681 | ) | (2,278 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Issuance of non-voting shares | 2 | 72 | (72 | ) | — | (72 | ) | — | 2 | |||||||||||||||||||
Share-based remuneration | — | — | 216 | — | 216 | — | 216 | |||||||||||||||||||||
Offset of accumulated losses with share premium | — | (30,639 | ) | — | — | — | 30,639 | — | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
March 31, 2016 | 1,696 | 69,030 | 3,371 | 1,997 | 5,368 | (13,479 | ) | 62,615 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
January 1, 2017 | 1,740 | 71,966 | 2,423 | (489 | ) | 1,934 | (39,599 | ) | 36,041 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Loss for the period | — | — | — | — | — | (15,538 | ) | (15,538 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | — | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total comprehensive loss | — | — | — | — | — | (15,538 | ) | (15,538 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Issuance of shares - IPO | 496 | 96,254 | — | — | — | — | 96,750 | |||||||||||||||||||||
Issuance of shares - equity incentive plan | 4 | 138 | (138 | ) | — | (138 | ) | — | 4 | |||||||||||||||||||
Share issuance costs | — | (8,098 | ) | — | — | — | — | (8,098 | ) | |||||||||||||||||||
Share-based remuneration | — | — | 2,324 | — | 2,324 | — | 2,324 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
March 31, 2017 | 2,240 | 160,260 | 4,609 | (489 | ) | 4,120 | (55,137 | ) | 111,483 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes form an integral part of these consolidated interim financial statements.
5
ObsEva SA
Consolidated Interim Financial Statements
Notes to the Consolidated Interim Financial Statements for the three-month period ended March 31, 2017
(unaudited)
1. | General information |
ObsEva SA (the “Company”) was founded on November 14, 2012, and its address is 12 Chemin des Aulx, 1228 Plan-les-Ouates, Geneva, Switzerland. The terms “ObsEva” or “the Group” refer to ObsEva SA together with its subsidiaries included in the scope of consolidation (note 2.3).
The Group is focused on the development and commercialization of novel therapeutics for serious conditions that compromise women’s reproductive health and pregnancy. The Group has a portfolio of three mid- to late-stage development in-licensed compounds (OBE2109, OBE001 (“nolasiban”) and OBE022) developed in four indications. The Group has no currently marketed products.
These consolidated interim financial statements are presented in dollars of the United States (USD), rounded to the nearest thousand, except share and per share data, and have been prepared on the basis of the accounting principles described in note 2.
These consolidated interim financial statements were authorized for issue by the Audit Committee of the Company’s Board of Directors (the “Board of Directors”) on May 12, 2017.
2. | Accounting principles and scope of consolidation |
2.1 Basis of preparation and accounting principles
These unaudited three-month consolidated interim financial statements (the “interim financial statements”) are prepared in accordance with International Accounting Standard (“IAS”) 34 Interim Financial Reporting as issued by the International Accounting Standards Board (the “IASB”).
As from January 1, 2017, due to a change of the primary economic environment of the Company, the functional currency of ObsEva SA became the USD, which is also the presentation currency of the Group.
Other accounting policies used in the preparation and presentation of these consolidated interim financial statements are consistent with those used in the consolidated financial statements for the year ended December 31, 2016 (the “annual financial statements”), which should be read in conjunction with these consolidated interim financial statements as they provide an update of previously reported information.
The Group believes it will be able to meet all of its obligations as they fall due for a further 12 months from March 31, 2017, hence, the unaudited consolidated interim financial statements have been prepared on a going concern basis.
2.2 Use of estimates and assumptions
The preparation of consolidated interim financial statements requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets, liabilities and disclosure of contingent liabilities at the date of the interim financial statements. If in the future such estimates and assumptions, which are based on management’s best judgment at the date of the consolidated interim financial statements, deviate from the actual circumstances, the original estimates and assumptions will be modified as appropriate during the period in which the circumstances change.
The Group’s activities are not affected by any significant seasonal effect.
6
ObsEva SA
Consolidated Interim Financial Statements
2.3 | Scope of consolidation |
There was no change to the scope of consolidation during the reporting period and the Company consolidates the financial operations of its two fully-owned subsidiaries, ObsEva Ireland Ltd, which is registered in Cork, Ireland and organized under the laws of Ireland, and ObsEva USA Inc., which is registered and organized under the laws of Delaware, USA. ObsEva Ireland Ltd had no operations and no results of operations to report as of March 31, 2017.
3. | Cash and cash equivalents |
(in USD ‘000) | As at March 31, 2017 | As at December 31, 2016 | ||||||
unaudited | audited | |||||||
Bank deposits | 104,158 | 23,292 | ||||||
Interest bearing deposits | — | 2,216 | ||||||
|
|
|
| |||||
Total cash and cash equivalents | 104,158 | 25,508 | ||||||
|
|
|
|
4. | Intangible assets |
As at March 31, 2017 and December 31, 2016, the Group held a number of licenses to operate several biopharmaceutical product candidates, the value of which is recorded at USD 16.6 million.
5. | Shareholders’ equity |
On February 23, 2016, the shareholders approved for statutory purposes a resolution to offset the accumulated losses with the share premium balance for an amount of USD 30.6 million. This transaction had no impact on the overall equity position.
On January 25, 2017, the Company raised gross proceeds of USD 96.8 million in an IPO on The NASDAQ Global Select Market, a U.S. market. The IPO closed on January 30, 2017 with the issuance of 6,450,000 new ordinary shares at a subscription price of USD 15.00 per share and a par value of 1/13 of a Swiss franc per share. The proceeds have been recorded in equity net of directly related share issuance costs of USD 8.1 million.
6. | Research and development expenses |
Due to the difficulty in assessing when research and development projects would generate revenue, the Group expenses all research and development costs to the profit and loss accounts.
For the three-month periods ended March 31, 2017 and 2016, the Group pursued its research and development programs totaling expenses of USD 13.1 million and USD 3.8 million, respectively.
7. | Loss per share |
As of March 31, 2017, the Company had one category of shares, which are common shares. As of March 31, 2016, the Company’s shares were comprised of ordinary shares, consisting of both common shares and non-voting shares, and series A and series B preferred shares. The Company’s non-voting shares and series A and series B preferred shares were converted into common shares on January 25, 2017.
7
ObsEva SA
Consolidated Interim Financial Statements
For the three-month period ended March 31, 2016, since the series A and series B preferred shares participated with ordinary shares in the profit or loss on a pro-rata basis, the net loss was allocated to each class pro-rata to their weighted average number of shares outstanding during the period. The basic loss per share is calculated by dividing the loss of the period attributable to the ordinary shares by the weighted average number of ordinary shares (common and non-voting) outstanding during the period as follows:
Three-month period ended March 31, 2017 | ||||
(unaudited) | ||||
Common shares | ||||
Net loss attributable to shareholders (in USD ‘000) | (15,538 | ) | ||
Weighted average number of shares outstanding | 26,623,553 | |||
|
| |||
Basic and diluted loss per share (in USD) | (0.58 | ) | ||
|
|
Three-month period ended March 31, 2016 (unaudited) | ||||||||||||
Preferred B shares | Preferred A shares | Common and non-voting shares | ||||||||||
Net loss attributable to shareholders (in USD ‘000) | (2,428 | ) | (1,689 | ) | (564 | ) | ||||||
Weighted average number of shares outstanding | 11,079,549 | 7,706,777 | 2,573,408 | |||||||||
|
|
|
|
|
| |||||||
Basic and diluted loss per share (in USD) | (0.22 | ) | (0.22 | ) | (0.22 | ) | ||||||
|
|
|
|
|
|
For the three-month period ended March 31, 2017, 1,184,023 non-vested shares, 5,200 treasury shares and 428,450 shares issuable upon the exercise of stock-options, which would have an anti-dilutive impact on the calculation of the diluted earnings per share, are excluded from the calculation (three-month period ended March 31, 2016: 587,815 non-vested shares, 80,353 treasury shares and no shares issuable upon the exercise of stock-options were excluded).
8. | Financial instruments |
The Group’s financial assets consist of cash and cash equivalents and other receivables which are classified as assets at amortized costs according to IAS 39. The Group’s financial liabilities consist of other payables and accruals which are classified as other liabilities at amortized costs according to IAS 39.
9. | Segment information |
The Group operates in one segment, which is the research and development of innovative women’s reproductive, health and pregnancy therapeutics. The marketing and commercialization of such therapeutics depend on the success of the clinical development phase. The Chief Executive Officer of the Company reviews the consolidated statement of operations of the Group on an aggregated basis and manages the operations of the Group as a single operating segment.
The Group currently generates no revenue from the sales of therapeutics products.
8
ObsEva SA
Consolidated Interim Financial Statements
The geographical analysis of assets is as follows:
(in USD ‘000) | As at March 31, 2017 | As at December 31, 2016 | ||||||
unaudited | audited | |||||||
Switzerland | 122,165 | 45,525 | ||||||
USA | 925 | — | ||||||
|
|
|
| |||||
Total assets | 123,090 | 45,525 | ||||||
|
|
|
|
All capital expenditures during the three-month period ended March 31, 2017 and 2016 were made in Switzerland.
The geographical analysis of operating expenses is as follows:
Three-month period ended March 31, | ||||||||
(in USD ‘000) | 2017 | 2016 | ||||||
unaudited | ||||||||
Switzerland | 15,232 | 4,474, | ||||||
USA | 570 | — | ||||||
|
|
|
| |||||
Total operating expenses | 15,802 | 4,474 | ||||||
|
|
|
|
10. | Events after the reporting period |
On April 25, 2017, the Group announced the initiation of its Phase 3 clinical program for OBE2109 in uterine fibroids and related activation of sites and start of recruitment, which triggered a commitment for the Company to pay a USD 5 million milestone to Kissei Pharmaceutical Co., Ltd., to be accounted for as intangible asset.
There were no other material events after the balance sheet date.
9