Press Release: Evofem Biosciences Reports Third Quarter 2020 Financial Results and Provides Corporate Update
4:01 pm ET November 9, 2020 (Dow Jones) Print
Evofem Biosciences Reports Third Quarter 2020 Financial Results and Provides Corporate Update
Launched Phexxi(TM) (lactic acid, citric acid, potassium bitartrate) in U.S. for Hormone-free Contraception
Initiated Pivotal Phase 3 EVOGUARD Trial of EVO100 for Prevention of Chlamydia and Gonorrhea
Secured $25 Million Strategic Investment from Adjuvant Capital
Management to Host Conference Call Monday, November 9, 2020 at 5:00 p.m. ET
PR Newswire
SAN DIEGO, Nov. 9, 2020
SAN DIEGO, Nov. 9, 2020 /PRNewswire/ -- Evofem Biosciences, Inc., (NASDAQ: EVFM) ("Evofem" or the "Company"), today reported financial results for the three- and nine- month periods ended September 30, 2020.
"We are excited by the early momentum of our commercial launch of Phexxi, the first and only hormone-free, prescription contraceptive vaginal gel, which became available in the United States in September," said Saundra Pelletier, Evofem's Chief Executive Officer. "Our investments in consumer brand awareness and telemedicine have been critical drivers of our early success. The reported financial results represent a small snapshot of our commercial launch, and we continue to expect Phexxi to reach its full market potential based on key launch metrics including the number of women who have taken advantage of our Phexxi Concierge Experience, Phexxi.com website visitors, and interest among healthcare providers.
"Our commitment to develop and deliver innovative solutions to unmet needs in women's health does not stop with hormone-free contraception. Last month we initiated EVOGUARD, our pivotal Phase 3 trial of EVO100 vaginal gel for prevention of chlamydia and gonorrhea infection in women. There are no FDA approved drugs to prevent these common infections, and the need continues to increase every year. Assuming timely completion and positive study results, we would expect to file an NDA for these indications in 2022.
"The recent $25 million strategic investment in Evofem by Adjuvant Capital, a healthcare investor aligned with our vision, at a premium to market, provides significant funding for EVOGUARD and strengthens our ability to transform women's health in the United States and around the world," concluded Ms. Pelletier.
Third quarter and recent highlights include:
-- Launched Phexxi(TM) (lactic acid, citric acid and potassium bitartrate)
as the first and only hormone-free, prescription vaginal gel approved in
the United States for the prevention of pregnancy;
-- Initiated EVOGUARD, the pivotal Phase 3 clinical trial to evaluate safety
and efficacy of EVO100 for the prevention of chlamydia and gonorrhea in
women;
-- Secured a $25 million strategic investment from Adjuvant Capital at a
premium to market, with proceeds earmarked to fund EVOGUARD and expand
global market access for Phexxi;
-- The Phase 3 AMPOWER study of Phexxi for prevention of pregnancy was
published in the peer-reviewed journal Contraception, and six AMPOWER
abstracts were presented at major medical society meetings; and,
-- Outcomes of the Phase 2b AMPREVENCE study of EVO100 for the prevention of
chlamydia and gonorrhea in women were presented at three major medical
society meetings, including pivotal results presented in a poster at the
2020 STD Prevention Virtual Conference.
Financial Results
The third quarter of 2020 was Evofem's first quarter reporting product sales, following the United States commercial launch of Phexxi on September 8, 2020 as the first and only hormone-free, prescription vaginal gel approved for the prevention of pregnancy. Net product sales were $0.3 million for the three months ended September 30, 2020. Cost of goods sold was $0.3 million, which included a $0.1 million one-time charge predominantly related to reworking the Phexxi product label, which was initially printed at-risk before approval, to reflect the final approved label.
Research and development costs for the third quarter of 2020 were $4.2 million, compared to $5.7 million in the prior year quarter, primarily due to the absence in the current period of service fees associated with the Phexxi New Drug Application and of AMPREVENCE clinical trial costs, which were submitted to the FDA and completed, respectively, in the fourth quarter of 2019. The decrease was partially offset by clinical trial expenses for EVOGUARD, which was initiated in October 2020, and higher payroll-related expenses and noncash stock-based compensation due to increased headcount in the current period.
Selling and marketing costs for the third quarter of 2020 were $14.7 million. For the third quarter of 2019, selling and marketing costs of $3.8 million were reclassified from general and administrative expenses to conform to the current period presentation. The increased expense in the current period primarily reflects a $6.9 million increase in media and advertising costs, combined with higher marketing and market access service costs incurred in preparation for the Phexxi commercial launch. Higher payroll-related expenses due to increased headcount and an uptick in facilities costs also contributed.
General and administrative costs for the third quarter of 2020 were $7.2 million, compared to $4.8 million in the prior year quarter. The increase is primarily related to an aggregate $2.9 million increase in costs associated with various operational items associated with legal, audit and financing advisory fees, sales force recruiting costs, payroll related costs due to increased headcount, and other general business expenses. This was partially offset by a $0.5 million decrease in noncash stock-based compensation.
As a result, total operating expenses increased to $26.4 million for the third quarter of 2020, compared to $14.3 million for the prior year period.
Total other expense, net, was $3.7 million in the third quarter of 2020, and mainly included a $3.1 million change in fair value as a result of mark-to-market adjustments and $0.7 million in accrued interest expense for the convertible notes issued in the second quarter of 2020. This compares to total other income of $0.5 million in the prior year quarter, which included higher interest income.
Net loss attributable to common stockholders was $29.9 million, or $(0.37) per share, for the quarter ended September 30, 2020, compared with a net loss of $13.8 million, or $(0.30) per share, for the prior year quarter.
Unrestricted cash and short-term investments were $86.7 million at September 30, 2020, compared to $23.8 million at December 31, 2019.
In October 2020, Evofem sold $25 million of unsecured convertible promissory notes to funds affiliated with Adjuvant Capital, LP ("Adjuvant Capital"). The notes are convertible into shares of Evofem common stock at a conversion price of $3.65 per share. Proceeds from the sale of the notes will be used to support EVOGUARD, Evofem's ongoing Phase 3 clinical trial of EVO100 for the prevention of urogenital chlamydia and gonorrhea in women, and to expand global market access for Phexxi.
