Kamada Reports First Quarter 2020 Financial Results and Highlights Recent Corporate Progress

  • Total Revenues were $33.3 Million, an Increase of 24% Year-over-Year
  • Net Income was $5.2 Million, an Increase of 6% Year-over-Year
  • Company Reports Continued Progress of its Development Program of a Plasma-Derived Hyperimmune IgG Therapy for COVID-19; Product Availability for Clinical and Compassionate Use Treatment for COVID-19 patients in Israel is Expected by End of the Second Quarter of 2020
  • Company’s Manufacturing Plant Continues to Operate Without Significant Disruption During Ongoing Coronavirus (COVID-19) Outbreak
  • Kamada Reiterates Full-Year 2020 Total Revenue Guidance of $132 Million to $137 Million

REHOVOT, Israel, May 18, 2020 (GLOBE NEWSWIRE) -- Kamada Ltd. (NASDAQ: KMDA; TASE: KMDA.TA), a plasma-derived biopharmaceutical company, today announced financial results for the three months ended March 31, 2020.

“As the ongoing COVID-19 global pandemic continues to create substantial complications in daily life and business operations, we are focused on the safety and well-being of our employees, who continue to find innovative solutions to support our patients and partners,” said Amir London, Kamada’s Chief Executive Officer.  “These efforts contributed to our strong performance in the first quarter of the year.  Total revenues were $33.3 million, an increase of 24 percent year-over-year.  These results were driven by similar year-over year increase in sales of both our Proprietary and Distributed products.  Based on our strong performance in the first quarter and our current outlook for the remainder of the year, we are reiterating our guidance of total revenues of between $132 million and $137 million for full-year 2020.”

“To date, our manufacturing plant remains operational with no effect on business continuity, even amidst the emergency regulations enforced in Israel in recent months due to the COVID-19 pandemic.  Moreover, based on the most recent interactions with our U.S. distribution partners regarding finished product inventory levels available for distribution in the U.S and our planned supply for the remainder of the year, we do not anticipate meaningful supply shortages in the foreseeable future in the U.S. market for GLASSIA® or KEDRAB®.  In addition, based on currently available inventory levels and planned supply of our Distributed products in Israel, we do not anticipate significant supply shortages in the foreseeable future.  Going forward, although certain COVID-19 pandemic-related dynamics may affect market demand and production conditions, we intend to maintain our current manufacturing and supply plans, and increased inventory levels of raw materials through our suppliers and service providers in order to appropriately manage any potential supply disruptions and secure continued manufacturing,” continued Mr. London.

“As previously reported, during the first quarter, we were able to quickly focus our efforts on the development and manufacturing of a plasma-derived hyperimmune IgG product for COVID-19, which leverages our proprietary IgG platform technology, as a potential treatment for COVID-19 patients.  We are pleased to report today that we have secured adequate quantities of COVID-19 convalescent plasma in Israel. This has enabled us to initiate manufacturing of the product, which is expected to be available by the end of the second quarter for compassionate use treatment in Israel, based on Israeli Ministry of Health (IMOH) regulations.  Concurrently, we have ongoing discussions with the IMOH with regard to the potential initiation of related clinical trials.  In addition, we were excited to recently announce our global collaboration with Kedrion Biopharma, which will allow us to more rapidly develop our plasma-derived hyperimmune IgG product for COVID-19 and broaden our international reach,” concluded Mr. London.

Financial Highlights for the Three Months Ended March 31, 2020

  • Total revenues were $33.3 million in the first quarter of 2020, a 24% increase from the $26.8 million recorded in the first quarter of 2019
  • Revenues from the Proprietary Products segment in the first quarter of 2020 were $25.3 million, a 24% increase from the $20.4 million reported in the first quarter of 2019
  • Revenues from the Distribution segment were $8.0 million in the first quarter of 2020, a 24% increase from the $6.4 million recorded in the first quarter of 2019
  • Gross profit was $11.5 million in the first quarter of 2020, a 2% increase from the $11.2 million reported in the first quarter of 2019; overall gross profitability differences are affected by changes in product sales mix between the quarters
  • Operating expenses, including R&D, Sales & Marketing, G&A, and Other expenses, totaled $6.6 million in the first quarter of 2020, as compared to $6.0 million in the first quarter of 2019.  This increase was primarily driven by increased R&D expenses specifically related to the initiation of the Company’s pivotal Phase 3 InnovAATe clinical trial which is designed to evaluate the Company’s proprietary inhaled Alpha-1 Antitrypsin therapy for treatment of Alpha-1 Antitrypsin Deficiency
  • Net income was $5.2 million, or $0.12 per share, in the first quarter of 2020, as compared to net income of $4.9 million, or $0.12 per share, in the first quarter of 2019
  • Adjusted EBITDA, as detailed in the tables below, was $6.3 million in the first quarter of 2020, as compared to $6.7 million in the first quarter of 2019
  • Cash used in operating activities was $1.9 million in the first quarter of 2020, as compared to cash provided by operating activities of $6.1 million in the first quarter of 2019.  This change in operating activity cash flow is specifically related to timing of payments to suppliers on account of inventories which are expected to be sold later this year

Balance Sheet Highlights
As of March 31, 2020, the Company had cash, cash equivalents, and short-term investments of $96.4 million, as compared to $73.9 million at December 31, 2019.  This includes the net proceeds generated from the $25 million private placement transaction with the FIMI Opportunity Fund closed in February 2020.

Recent Corporate Highlights

  • Plasma-derived hyperimmune IgG product for COVID-19

° Announced a collaboration with Kedrion Biopharma for the development, manufacturing and distribution of a plasma-derived hyperimmune IgG product for COVID-19
° Initiated manufacturing of the product based on collected convalescent plasma in Israel; product is expected to be available for clinical and compassionate use treatment in Israel by the end of the second quarter

  • Inhaled AAT product

° Enrolment in the pivotal Phase 3 InnovAATe clinical trial, which continued through February 2020, was temporarily halted due to the impact of COVID-19 pandemic on healthcare systems. Patients already recruited to the study continued treatment as planned. The Company anticipates resuming enrollment into the study in the third quarter of 2020, pending appropriate conditions at clinical trial sites.
° InnovAATe clinical trial is designed to evaluate the Company’s proprietary inhaled Alpha-1 Antitrypsin therapy for treatment of Alpha-1 Antitrypsin Deficiency
° Obtained U.S. Food and Drug Administration (FDA) acceptance for the protocol design of a 30 patient sub-study, designed to evaluate the effect of Kamada‘s Inhaled AAT on pharmacokinetics of IV-AAT and collect safety and immunogenicity data, including the effect of anti-drug antibodies (ADA) on AAT levels in plasma. Initiation of this sub-study has been delayed due to COVID-19 pandemic effect

Conference Call
Kamada management will host an investment community conference call on Monday, May 18, at 8:30am Eastern Time to discuss these results and answer questions. Shareholders and other interested parties may participate in the conference call by dialing 877-407-0792 (from within the U.S.), 1809 406 247 (from Israel), or 201-689-8263 (International) and entering the conference identification number: 13699990. The call will also be webcast live on the Internet on the Company’s website at www.kamada.com.

About Kamada
Kamada Ltd. (“the Company”) is a commercial stage plasma-derived biopharmaceutical company focused on orphan indications, with an existing marketed product portfolio and a late-stage product pipeline. The Company uses its proprietary platform technology and know-how for the extraction and purification of proteins from human plasma to produce Alpha-1 Antitrypsin (AAT) in a highly-purified, liquid form, as well as other plasma-derived immune globulins. The Company’s flagship product is GLASSIA®, the first liquid, ready-to-use, intravenous plasma-derived AAT product approved by the U.S. FDA. The Company markets GLASSIA in the U.S. through a strategic partnership with Takeda Pharmaceuticals Company Limited and in other countries through local distributors. The Company’s second leading product is KamRab®, a rabies immune globulin (Human) for post-exposure prophylaxis against rabies infection. KamRab is FDA approved and is being marketed in the U.S. under the brand name KEDRAB® through a strategic partnership with Kedrion S.p.A. In addition to Glassia and KEDRAB, the Company has a product line of four other plasma-derived pharmaceutical products administered by injection or infusion, that are marketed through distributors in more than 15 countries, including Israel, Russia, Brazil, India and other countries in Latin America and Asia. The Company has late-stage products in development, including an inhaled formulation of AAT for the treatment of AAT deficiency. In addition, the Company’s intravenous AAT is in development for other indications, such as GvHD and prevention of lung transplant rejection. The Company leverages its expertise and presence in the plasma-derived protein therapeutics market by distributing more than 20 complementary products in Israel that are manufactured by third parties.  FIMI Opportunity Fund, the leading private equity investor in Israel, is the Company’s lead shareholder, beneficially owning approximately 21% of the outstanding ordinary shares.

Cautionary Note Regarding Forward-Looking Statements
This release includes forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts, including statements regarding 1) the total revenues to be in the range of $132 million to $137 million for fiscal 2020; 2) not anticipating meaningful supply shortages in the foreseeable future in the U.S. market for GLASSIA® or KEDRAB®; 3) not anticipating significant supply shortages in the foreseeable future for Kamada’s Distributed products in Israel; 4) anticipating maintaining current manufacturing and supply plans; 5) increasing inventory levels of raw materials through suppliers and service providers in order to appropriately manage any potential supply disruptions and secure continued manufacturing; 6) anticipating availability for clinical and compassionate-use treatment in Israel of a plasma-derived hyperimmune IgG product for COVID-19, form COVID-19 convalescent plasma, by the end of the second quarter of 2020; 7) anticipating that the global collaboration with Kedrion Biopharma will allow Kamada to speed up the development of the plasma-derived hyperimmune IgG product for COVID-19 and broaden the product’s international reach; and 8) anticipating that Phase 3 InnovAATe clinical trial will resume enrollment in the third quarter of 2020. Forward-looking statements are based on Kamada’s current knowledge and its present beliefs and expectations regarding possible future events and are subject to risks, uncertainties and assumptions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including, but not limited to, the continued evolvement of the COVID-19 pandemic, its effect and duration, availability of sufficient raw materials required to maintain manufacturing plans, the effects of the COVID-19 pandemic and related government mandates on the availability of adequate levels of work-force required to maintain manufacturing plans, disruption to the supply chain due to COVID-19 pandemic, continuation of inbound and outbound international delivery routes, continued demand for Kamada’s products, including GLASSIA and KEDRAB, in the U.S. market and its distributed products in Israel, ability to obtain regulatory approval for clinical trials of the plasma-derived hyperimmune IgG product for COVID-19, unexpected results of clinical studies and on-going compassionate-use treatments, ability to find doctors and medical facilities to collaborate on compassionate-use treatments, Kamada’s ability to manage operating expenses, additional competition in the markets that Kamada competes, regulatory delays, prevailing market conditions and the impact of general economic, industry or political conditions in the U.S., Israel or otherwise. The forward-looking statements made herein speak only as of the date of this announcement and Kamada undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.

CONTACTS:
Chaime Orlev
Chief Financial Officer
IR@kamada.com

Bob Yedid
LifeSci Advisors, LLC
646-597-6989
Bob@LifeSciAdvisors.com



       
Consolidated Balance Sheets      
       
  As of March 31,  As of
December 31,
 
  2020  2019  2019 
          
  Unaudited  Audited 
       
  U.S Dollars in thousands 
Assets         
Current Assets            
Cash and cash equivalents $49,288  $22,037  $42,662 
Short-term investments  47,124   33,800   31,245 
Trade receivables, net  26,266   23,210   23,210 
Other accounts receivables  1,736   3,442   3,272 
Inventories  41,787   31,708   43,173 
Total Current Assets  166,201   114,197   143,562 
             
Non-Current Assets            
Property, plant and equipment, net  24,379   24,642   24,550 
Right-of-use assets  3,800   4,187   4,022 
Other long term assets  1,053   174   352 
Deferred expenses  421   -   - 
Deferred taxes  939   1,895   1,311 
Total Non-Current Assets  30,592   30,898   30,235 
Total Assets $196,793  $145,095  $173,797 
Liabilities            
Current Liabilities            
Current maturities of bank loans $465  $470  $489 
Current maturities of lease liabilities  928   961   1,020 
Trade payables  18,440   15,255   24,830 
Other accounts payables  4,875   4,424   5,811 
Deferred revenues  649   461   589 
Total Current Liabilities  25,357   21,571   32,739 
             
Non-Current Liabilities            
Bank loans  138   591   257 
Lease liabilities  3,663   4,036   3,981 
Deferred revenues  569   605   232 
Employee benefit liabilities, net  1,251   823   1,269 
Total Non-Current Liabilities  5,621   6,055   5,739 
             
Shareholder’s Equity            
Ordinary shares  11,647   10,412   10,425 
Additional paid in capital  net  204,702   179,352   180,819 
Capital reserve due to translation to presentation currency  (3,490)  (3,490)  (3,490)
Capital reserve from hedges  264   11   8 
Capital reserve from financial assets measured at fair value through other comprehensive income  -   118   145 
Capital reserve from share-based payments  8,903   9,463   8,844 
Capital reserve from employee benefits  (356)  4   (359)
Accumulated deficit  (55,855)  (78,401)  (61,073)
Total Shareholder’s Equity  165,815   117,469   135,319 
Total Liabilities And Shareholder’s Equity $196,793  $145,095  $173,797 
 



 
Consolidated Statements of Comprehensive Income
       
  Three months period ended  Year ended 
  March 31,  December 31, 
  2020  2019  2019 
          
  Unaudited  Audited 
       
  U.S Dollars in thousands 
          
Revenues from proprietary products $25,317  $20,381  $97,696 
Revenues from distribution  7,973   6,416   29,491 
             
Total revenues  33,290   26,797   127,187 
             
Cost of revenues from proprietary products  14,947   10,490   52,425 
Cost of revenues from distribution  6,892   5,123   25,025 
             
Total cost of revenues  21,839   15,613   77,450 
             
Gross profit  11,451   11,184   49,737 
             
Research and development expenses  3,347   2,766   13,059 
Selling and marketing expenses  940   1,092   4,370 
General and administrative expenses  2,312   2,094   9,194 
Other expense  2   23   330 
Operating income  4,850   5,209   22,784 
             
Financial income  317   280   1,146 
Income (expense) in respect of securities measured at fair value, net  102   (52)  (5)
Income (expense) in respect of currency exchange differences and derivatives instruments, net  432   (313)  (651)
Financial expense  (77)  (71)  (293)
Income before tax on income  5,624   5,053   22,981 
Taxes on income  406   130   730 
             
Net Income $5,218  $4,923  $22,251 
             
Other Comprehensive Income (loss) :            
Amounts that will be or that have been reclassified to profit or loss when specific conditions are met            
Gain (loss) from securities measured at fair value through other comprehensive income  (188)  108   143 
Gain on cash flow hedges  241   74   92 
Net amounts transferred to the statement of profit or loss for cash flow hedges  34   (2)  (23)
Items that will not be reclassified to profit or loss in subsequent periods:            
Remeasurement gain (loss) from defined benefit plan  -   -   (388)
Tax effect  27   (28)  (11)
Total comprehensive income $5,332  $5,075  $22,064 
             
Earnings per share attributable to equity holders of the Company:            
Basic income per share $0.12  $0.12  $0.55 
Diluted income per share $0.12  $0.12  $0.55 
 



 
Consolidated Statements of Cash Flows
       
  Three months period Ended  Year Ended 
  March 31,  December 31, 
  2020  2019  2019 
          
  Unaudited  Audited 
       
  U.S Dollars in thousands 
Net income $5,218  $4,923  $22,251 
             
Adjustments to reconcile net income to net cash provided by operating activities:            
             
Adjustments to the profit or loss items:            
             
Depreciation and impairment  1,192   1,127   4,519 
Financial expenses (income), net  (774)  156   (197)
Cost of share-based payment  258   315   1,163 
Taxes on income  406   130   730 
Loss (gain) from sale of property and equipment  -   (6)  (2)
Change in employee benefit liabilities, net  (18)  36   94 
   1,064   1,758   6,307 
Changes in asset and liability items:            
             
Decrease (increase) in trade receivables, net  (3,016)  4,727   5,117 
Decrease (increase) in other accounts receivables  1,513   131   (214)
Decrease (increase) in inventories  1,386   (2,392)  (13,857)
Decrease (increase) in deferred expenses  (421)  (246)  399 
Increase (decrease) in trade payables  (7,216)  (2,368)  6,259 
Increase (decrease) in other accounts payables  (1,180)  (510)  863 
Increase (decrease) in deferred revenues  397   (63)  (283)
   (8,537)  (721)  (1,716)
Cash received (paid) during the year for:            
             
Interest paid  (55)  (63)  (243)
Interest received  451   172   1,106 
Taxes paid  (61)  (8)  (134)
   335   101   729 
             
Net cash provided by (used in) operating activities $(1,920) $6,061  $27,571 
 



 
Consolidated Statements of Cash Flows
 
  Three months period Ended  Year Ended 
  March 31,  December 31, 
  2020  2019  2019 
          
  Unaudited  Audited 
       
  U.S Dollars in thousands 
Cash Flows from Investing Activities         
          
Investment in short term investments, net $(15,646) $(1,058) $1,727 
Purchase of property and equipment and intangible assets  (896)  (304)  (2,300)
Proceeds from sale of property and equipment  -   6   9 
Net cash used in investing activities  (16,542)  (1,356)  (564)
             
Cash Flows from Financing Activities            
             
Proceeds from exercise of share base payments  5   3   16 
Repayment of lease liabilities  (278)  (263)  (1,070)
Repayment of long-term loans  (123)  (115)  (476)
Proceeds from issuance of ordinary shares, net  24,894   -   - 
             
Net cash provided by (used in) financing activities  24,498   (375)  (1,530)
             
Exchange differences on balances of cash and cash equivalent  590   (386)  (908)
             
Increase in cash and cash equivalents  6,626   3,944   24,569 
             
Cash and cash equivalents at the beginning of the year  42,662   18,093   18,093 
             
Cash and cash equivalents at the end of the year $49,288  $22,037  $42,662 
             
Significant non-cash transactions            
Purchase of property and equipment through capital lease $58  $4,431  $5,035 
Purchase of property and equipment $579  $235  $992 
 



       
Adjusted EBITDA      
  Three months period Ended  Year ended 
  March 31,  December 31, 
  2020  2019  2019 
          
          
  U.S. Dollars in thousands 
Net income (loss) $5,218  $4,923  $22,251 
Taxes on income  406   130   730 
Financial income, net  (774)  156   (197)
Depreciation and amortization expense  1,192   1,127   4,519 
Cost of share - based payments  258   315   1,163 
Adjusted EBITDA $6,300  $6,651  $28,466 


Adjusted Net Income      
  Three months period Ended  Year ended 
  March 31,  December 31, 
  2020  2019  2019 
          
          
  U.S. Dollars in thousands 
Net income (loss) $5,218  $4,923  $22,251 
Cost of share - based payments  258   315   1,163 
Adjusted net income $5,476  $5,238  $23,414 

 

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