Biofrontera reports Q1 2020 financial results
Biofrontera AG (NASDAQ: BFRA) reported its Q1 2020 results, showing total revenue of €6.5 million, a 5% decrease from €6.8 million in Q1 2019, significantly impacted by the COVID-19 pandemic. The company faced a 19% decline in product sales in the USA, totaling €4.2 million. Operating costs rose sharply, leading to a loss before tax of €5.5 million (up 109% year-over-year). Despite challenges, a licensing agreement with Maruho Co. Ltd. provided €6 million to support liquidity. The outlook for 2020 remains uncertain due to ongoing pandemic effects.
- Licensing agreement with Maruho Co. Ltd. resulted in a one-time payment of €6 million.
- Sales in Germany increased by 22% to €1.3 million compared to Q1 2019.
- Total revenue declined by 5% to €6.5 million compared to Q1 2019.
- Product sales in the USA dropped by 19%, from €5.2 million to €4.2 million.
- Loss before tax increased by 109% to €5.5 million.
- Loss after tax increased by 105% to €6.1 million.
- Uncertain outlook for 2020 due to potential ongoing impacts from COVID-19.
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Leverkusen, May 19, 2020 (GLOBE NEWSWIRE) -- Biofrontera AG (NASDAQ: BFRA; Frankfurt Stock Exchange: B8F) (the “Company”), an international biopharmaceutical company, today reported its financial results for the first quarter ended March 31, 2020 and provided an update on recent developments.
Key financial figures and business performance in Q1 2020
| 40%;">EUR thousands | 20%;">3M 2020 | 20%;">3M 2019 | 20%;">Change |
| Total revenue | 6,473 | 6,808 | ( |
| Research and development costs | (1,311) | (1,088) | |
| General administrative costs | (2,232) | (1,974) | |
| Sales costs | (8,698) | (5,554) | |
| Loss before tax | (5,498) | (2,637) | |
| Loss after tax | (6,082) | (2,980) |
For the period from January 1 to March 31, 2020, consolidated sales of 6.5 million euros reflect a decrease of
Sales in Germany kicked off the new year strongly, clearly exceeding our expectations. Despite falling sales figures in March, product sales in the first quarter of 2020 rose by
Operating costs, particularly sales and marketing expenses, have increased sharply compared to the first quarter 2019. The increase is primarily due to the periodic amortization of the Xepi™ license in the amount of EUR 0.5 million as well as the extraordinary impairment in the amount of EUR 2.0 million resulting from the revaluation of the Xepi™ license in light of the current market situation.
The first three months of this year brought mixed results for us. With an initially encouraging sales performance, positive regulatory and clinical developments and the successful reorganization of the global sales structure, we started very confidently into 2020. Since March 2020, the direct effects of the COVID-19 pandemic, declining sales figures and resulting company-wide cost reduction measures have dominated our business", summarizes Prof. Dr. Hermann Lübbert, CEO of Biofrontera, "In April 2020, we signed a license agreement with our long-term cooperation partner Maruho Co. Ltd., under which we received a one-time payment of 6 million euros. This partnership allows us to generate long-term revenues at low costs and low business risks in markets that we are unable to access with our own resources. We will continue to focus on the core sales markets, namely the USA and Europe, which are the most significant and already established markets for us. We will continue to work on strengthening the market position of our products Ameluz® and Xepi™ in order to be able to successfully exploit the market potential in the already approved as well as in new indications in the long term.”
Clinical development update
In January 2020, Biofrontera reported 12-month follow-up results of the phase III study for the treatment of actinic keratoses on the extremities and trunk/neck with a one-year lesion recurrence rate of
In the USA, Biofrontera is working on various initiatives to expand the indications for Ameluz® in order to achieve sustainable growth in the coming years. Biofrontera continues to recruit patients for the US phase III study with Ameluz® for the treatment of superficial basal cell carcinoma (BCC). Due to delays in patient recruitment, the company does not expect to announce study results before 2021. The approval for superficial BCC would significantly expand the market opportunities for Ameluz®, as this approval would allow Ameluz® to differentiate itself significantly from the competing PDT drug. In addition, as requested by the U.S. Food and Drug Administration (FDA), Biofrontera has started a pharmacokinetics study to investigate the safety and efficacy of the use of three tubes of Ameluz®. The study is expected to be completed in the second half of 2020. In connection with the use of Ameluz® on larger areas of the body, Biofrontera is developing the "BF-RhodoLED® XL" lamp and currently expects to submit an application for approval to the FDA in the second half of 2020 despite the COVID-19 crisis.
In April 2020, we signed an exclusive licensing agreement with Maruho Co. Ltd. (Maruho), for the commercialization and further development of Ameluz® in all indications in East Asia and Oceania. The agreement has a term of 15 years from the commencement of sales and includes an immediate upfront payment of EUR 6 million as well as milestone payments and royalties of
Financial position
Cash and cash equivalents amounted to EUR 7.8 million as of March 31, 2020 compared to EUR 11.1 million as of December 31, 2019.
To date, the Biofrontera Group has been able to meet its payment obligations at all times. The company's current level of liquidity is sufficient due to the drawdown of the second tranche of the EIB loan in February 2019 in the amount of EUR 5.0 million as well as the receipt of the EUR 6.0 million down payment from Maruho as part of the licensing agreement signed in April 2020. Biofrontera plans to raise capital during the course of 2020 in order to secure liquidity in the medium and long term and has submitted a corresponding proposal for resolution to the Annual General Meeting to be held on May 28, 2020. While management is currently very positive about the ability to successfully complete this capital measure, this cannot be guaranteed. Should this no longer be possible due to an ongoing crisis caused by the COVID-19 pandemic or any other reason, this would pose a threat to the going-concern status of the Biofrontera Group.
Outlook 2020
Since March 2020, business activities have been directly affected by the effects of the COVID-19 pandemic. During the crisis, chronic diseases such as actinic keratosis were not the main focus of medical attention. As it is currently impossible to foresee how long and how strongly the pandemic will affect the economy and our business, no reliable estimate or more precise quantification of the specific implications for sales and earnings can be made for the 2020 financial year. For this reason, Biofrontera's ability to forecast is still significantly impaired. Therefore, the company is unable at this point to make any reliable forecasts regarding the course of business in 2020 that go beyond the statements made in the annual report.
Conference call
Conference calls for shareholders and interested investors will be held on Wednesday, May 20, 2020, at the following times:
In German, May 20, 2020 at 08:00 am CEST (2:00 am EST)
Dial-in number Germany: +49 69201744220
Conference code: 50182305#
In English, May 20, 2020 at 2:00 pm CEST (8:00 am EST)
Dial-in number USA: +1 8774230830
Dial-in number UK: +44 2030092470
Conference code: 70870259#
Please dial in 10 minutes ahead of time to ensure a timely start of the conference call.
The quarterly report will be available for download on our website at https://www.biofrontera.com/en/investors/financial-reports.
-End-
For enquiries, please contact:
Biofrontera AG
Thomas Schaffer, Chief Financial Officer
+49 (0) 214 87 63 2 0
ir@biofrontera.com
IR UK: Seton Services
Toni Vallen
+44 (0) 207 224 8468
About Biofrontera:
Biofrontera AG is a biopharmaceutical company specializing in the development and sale of dermatological drugs and medical cosmetics.
The Germany-based company, with almost 200 employees worldwide, develops and markets innovative products for the care, protection and treatment of the skin. The company’s lead product is the combination of Ameluz®, a topical prescription drug, and medical device BF-RhodoLED® for the photodynamic therapy of certain superficial skin cancers and their precursors. Ameluz® has been marketed in the EU since 2012 and in the United States since May 2016. In addition, the company markets the prescription medication Xepi™ for the treatment of impetigo in the United States. In the EU, the company also sells the dermocosmetics series Belixos®, which offers specialized care for damaged or diseased skin.
Biofrontera is the first German founder-led pharmaceutical company to receive a centralized European and a US approval for a drug developed in-house. The Biofrontera Group was founded in 1997 by the current CEO Prof. Dr. Hermann Lübbert and is listed on the Frankfurt Stock Exchange (Prime Standard) and on the US NASDAQ.www.biofrontera.com.
Forward-Looking Statements:
Certain statements in this press release are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the public offering and the intended use of proceeds from the offering. These statements may be identified by the use of forward-looking words such as "anticipate," "believe," "forecast," "estimate" and "intend," among others. Such forward-looking statements are based on the currently held beliefs and assumptions of the management of Biofrontera AG, which are expressed in good faith and, in their opinion, reasonable. Forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, financial condition, performance, or achievements of the Company, or industry results, to differ materially from the results, financial condition, performance or achievements expressed or implied by such forward-looking statements. These risks, uncertainties and other factors are set forth in the Company’s Annual Report on Form 20F and other reports filed by it with the SEC. Given these risks, uncertainties and other factors, prospective investors are cautioned not to place undue reliance on these forward-looking statements. The Company does not undertake an obligation to update or revise any forward-looking statement.
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