- Cash position of €226 million at
June 30, 2020 (€277 million atDecember 31, 2019 )
- New Corporate strategy focused on two priority areas:
- Development of elafibranor in Primary Biliary Cholangitis (PBC): ongoing enrolment for Phase 3 clinical trial ELATIVE™
- Commercialization of NIS4™ for NASH diagnosis: exclusive licensing agreement with Labcorp
- Plan to create two
GENFIT SA subsidiaries by 2021, to facilitate decision-making and enable an independent management and growth - Corporate restructuring plan to reprioritize capital for essential operating activities. Objective of cash burn reduction by more than 50% by 2022:
- Termination of elafibranor’s clinical development in NASH
- Termination of all activities associated with elafibranor’s launch preparations in NASH
- Reallocation of our research program to focus efforts on key programs
- Comprehensive cost-saving plan and restructuring plan, with a 40% workforce reduction in the Group
Conference Call in English on
Both the English and French conference calls will be accessible on the investor page of our website, under the events section at https://ir.genfit.com/ or by calling 877-407-9167 (toll-free
New corporate strategy and prospects
The company’s corporate strategy now focuses on two priority areas:
- Phase 3 clinical trial ELATIVE™ evaluating elafibranor in PBC:
- Patient enrolment now started, and results expected early 2023, given the current constraints due to the COVID-19 pandemic;
- Following the positive Phase 2 data of elafibranor in PBC, the
U.S. Food and Drug Administration (FDA) granted elafibranor Breakthrough Therapy designation. The ELATIVE™ study aims to confirm elafibranor’s previously successful results of efficacy, potential improvement in pruritus and safety in PBC patients; - Current market size for second line therapies in PBC is estimated at ~ $300MM in 2020 and is anticipated to experience double digit growth and estimates for 2025 are up to
$1B . Elafibranor is a promising alternative therapy to the existing treatment in PBC, based on the significant unmet needs in this indication.
NIS4 TM technology for (NASH) diagnosis:NIS4 TM technology data, recently published in The Lancet Gastroenterology & Hepatology, confirmed the technology’s diagnostic performance and garnered the support of leading NASH experts;- The recently announced exclusive licensing agreement with Labcorp for
NIS4 TM technology will enable a large-scale commercial launch as of next year; NIS4 TM addresses patients’ and payers’ requirements as liver biopsy remains the only – although imperfect – approved diagnostic option in the clinical development field and cannot be replicated on a large scale due to its painful and invasive nature, and its cost for healthcare systems. It would be impossible to diagnose all patients with biopsies given the limited number of procedures that can be performed. The blood test commercialized by Lacorp will address these multiple challenges;- The NASH therapeutic market is potentially significant, however, the opportunity is dependent on quick, reliable and easy to execute diagnostic solutions to identify patients.
NIS4 TM technology represents the essential first step in managing patients with NASH and is the first step for patients to take control, even in the absence of treatments, of their disease.
GENFIT’s new strategy includes a plan, which aims to create two distinct operational subsidiaries by 2021 to enable more independent management and growth:
- The first entity would be dedicated to the development of specialty indications, starting with the Phase 3 trial in PBC;
- The second entity would house NASH solutions, including all programs related to the identification, evaluation and monitoring of patients with NASH. This independent structure would facilitate future partnerships for NIS4™.
The two entities would remain a part of
Concurrently,
This plan incorporates the following key components:
- The overall clinical development program for elafibranor in NASH and all activities associated with the commercial launch of elafibranor in NASH have been terminated given the low probability of success compared to required expenses. The termination includes the NASH combination therapy trials, the pediatric trials, and other trials such as the evaluation of the impact of elafibranor on liver fat composition;
- A comprehensive cost-saving plan has been implemented, including the redirection of R&D activities and the termination of secondary programs (i.e. the RORgT program);
- A workforce restructuring plan aims to reduce the overall workforce by 40%, encompassing both the
U.S andFrance in order to align the company size to the new scope of activity.
Lastly,
Key aspects of the half-year 2020 results
Key aspects of the half-year 2020 results are:
- Cash and cash equivalents of €225.7 million at
June 30, 2020 (€276.7 million atDecember 31 , 2019);
- Operating income of €5.9 million (€5.4 million at
June 30, 2019 ), essentially from the Research Tax Credit, which amounted to €5.2 million for the first half 2020 (€5.3 million in the preceding half year);
- Operating expenses of €55.0 million (€51.3 million at
June 30, 2019 ) of which 67% represented R&D expenses.
The increase in operating expenses is due to increases in marketing and pre-commercialization expenses, which amounted to €9.5 million in the first half 2020 (€2.9 million in the first half 2019). Marketing and pre-commercialization expenses will significantly decrease as of the second half 2020 due to the discontinuation of the pre-commercialization work for elafibranor in NASH following the termination of this program in
General and administrative expenses (€8,2 million in the first half 2020 compared to €9.5 million in the first half 2019) and research and development expenses (€36.9 million in the first half 2020 compared to €38.9 million in the first half 2019) have decreased slightly between 2019 and 2020. These expenses will progressively decrease as of the second half 2020 following the Company’s decision to begin the process of terminating the clinical trials for elafibranor in NASH, terminating secondary programs and to execute a comprehensive cost saving plan over 3 years. Significant expenses related to the termination of the RESOLVE-IT trial will be due in the second half 2020 and in 2021.
As a result of changes in revenues and expenses, the net loss amounted to €53.0 million at
The table below presents the condensed Consolidated Statement of Operations under IFRS for the first half 2020, with comparative figures for the first half 2019.
For the six-month period ended | |||
(in € thousands, except earnings per share data) | |||
Revenues and other income | |||
Revenue | 1 | 122 | |
Other income | 5 356 | 5 745 | |
Revenues and other income | 5 357 | 5 867 | |
Operating expenses and other operating income (expenses) | |||
Research and development expenses | (38 908) | (36 867) | |
General and administrative expenses | (9 517) | (8 251) | |
Marketing and market access expenses | (2 876) | (9 491) | |
Other operating income (expenses) | 7 | (423) | |
Operating income (loss) | (45 936) | (49 163) | |
Financial income | 1 755 | 2 095 | |
Financial expenses | (7 240) | (6 102) | |
Financial profit (loss) | (5 485) | (4 007) | |
Net profit (loss) before tax | (51 422) | (53 170) | |
Income tax benefit (expense) | 289 | 159 | |
Net profit (loss) | (51 132) | (53 011) | |
Attributable to owners of the Company | (51 132) | (53 011) | |
Attributable to non-controlling interests | — | — | |
Basic and diluted earnings (loss) per share | |||
Basic and diluted earnings (loss) per share (€/share) | (1,64) | (1,36) |
Further information is described in the above New Corporate Strategy and Prospects section of this press release and in the condensed consolidated financial statements at
We encourage investors to take into consideration all the information presented in our 2019 Annual Report on Form 20-F (“Form 20-F”) and in this Half-Year Business and Financial Report before deciding to invest in Company shares; these two documents are available on GENFIT’s website www.genfit.com and on the website of the AMF (www.amf-france.org). This includes, in particular, the risk factors described in Item 4 of the Form 20-F (and the contents of this section), of which the realization may have (or has had in some cases) material adverse effect on the Group and its activity, financial situation, results, development or perspectives, and which are of importance in the investment decision-making process.
Key events of the first half of 2020 and main events after the reporting period
R&D Programs of the Company during H1 and After the Reporting Period
Elafibranor Development Program in NASH
RESOLVE-IT Phase 3 Study in NASH
In February, the Company announced that the final visit of the last patient for the interim cohort to support accelerated marketing approval had been completed on time, and the clinical trial database would be locked before the end of February. It also announced in late
In May, the Company announced the topline results of the interim analysis of the RESOLVE-IT Phase 3 trial evaluating the efficacy of the daily administration of elafibranor 120 mg in adults with NASH.
The RESOLVE-IT Phase 3 trial evaluated the effect of elafibranor compared to placebo in 1,070 patients (ITT population) with biopsy proven NASH as defined by NAFLD activity score (NAS) greater than or equal to 4, fibrosis stage 2 or 3. Patients were randomized 2:1 to receive elafibranor 120mg or placebo once daily, with a follow-up liver biopsy at week 72 to evaluate histologic endpoints (resolution of NASH without worsening of fibrosis or fibrosis improvement of at least one stage).
Resolution of NASH is defined by a ballooning score of 0 and an inflammation score of 0 or 1, and the non-worsening of fibrosis corresponds to a fibrosis score that does not increase.
The trial did not meet the predefined primary endpoint of NASH resolution without worsening of fibrosis in the ITT population. In the ITT population, 19.2% of patients who received elafibranor (N=138) achieved NASH resolution without worsening of fibrosis compared to 14.7% of patients in the placebo arm (N=52) (p=0.07).
On the key secondary endpoint of fibrosis improvement of at least one stage, 24.5% of patients who received elafibranor (N=176) achieved fibrosis improvement of at least one stage compared to 22.4% (N=79) in the placebo arm (p=0.445).
Statistical significance was not achieved in the other key secondary endpoint related to metabolic parameters, which were: triglycerides, non-HDL cholesterol, HDL cholesterol, LDL cholesterol, HOMA-IR in non-diabetic patients, and HbA1c in diabetic patients.
The favorable safety and tolerability profile of elafibranor observed in our previously conducted trials was similar to what has been observed in the interim results of RESOLVE-IT, which is encouraging for the ongoing Phase 3 trial evaluating elafibranor in PBC (see below).
While the topline results do not support an application for accelerated approval of elafibranor by the FDA under Subpart H or conditional approval by the
On
Pediatric NASH, Phase 2 Trial Addressing Liver Fat and Therapeutic Combination Program with elafibranor in NASH
Due to the COVID-19 pandemic, the Company had announced in late March that:
- enrollment of patients in the PK/PD trial in pediatric patients with NASH as well as the Phase 2 study addressing liver fat had been paused;
- the initiation of the Phase 2 combination study in NASH with elafibranor had been put on hold.
In September and following its decision to terminate all development of elafibranor in NASH, the Company decided to initiate the termination process of the PK/PD trial in pediatric NASH as well as the Phase 2 study on hepatic lipid composition.
Considering that clinical trials in the NASH space involve a large number of patients, are long and very expensive, as well as the fact that the regulatory and competitive landscape in this therapeutic area is in constant evolution, the Company has considered that the cost in relation to the probability of success was too high to continue development of elafibranor in NASH.
Other Phase 1 trials
The Company also announced in March, in the context of the COVID-19 pandemic, that all ongoing or upcoming phase 1 trials – which included pharmacokinetic, food effect and bioequivalence studies – had been put on hold. These studies were necessary to support a potential elafibranor NDA submission.
Since then, in line with the decision to end development of elafibranor in NASH, the following decisions have been made regarding these trials, given that some of them will be required for a new drug application for elafibranor in PBC:
- Pharmacokinetic and drug interaction studies have resumed;
- The bioequivalence study has restarted;
- The food interaction study will start in 2021.
Phase 3 of elafibranor Development in PBC Program
Due to the COVID-19 pandemic, the Company announced in late March that the start of the Phase 3 study in patients with PBC had been delayed.
In September, the Company has announced the completion of the first patient first visit in the ELATIVE™ Phase 3 trial. Appropriate measures will be implemented, including virtual appointments, biological evaluations performed by local laboratories, delivery of the drug candidate to the patients’ home, to ensure the safety of participants in the study.
NIS4™ Diagnostic Program in NASH
During the first half of the year, the NIS4™ technology to support a diagnostic solution continued to be deployed in the clinical research field through Covance. While interest in NIS4™ technology is high, the Company announced in late March that there may be some limits in NIS4™ powered test utilization due to delays potentially experienced by some sponsors as the result of the COVID-19 pandemic.
In August, the Company announced that pivotal data describing the derivation and validation of NIS4™ technology has been accepted for publication by The Lancet Gastroenterology & Hepatology. This published study details NIS4™ algorithm development and clinical validation against the liver biopsy reference standard in two independent populations comprised of data from over 700 patients. In addition to the high overall performance in indentifying patients with at-risk NASH, NIS4™ technology also provided consistent results in critical sub-populations (i.e. diabetic vs. non-diabetic, men vs. women) as compared to other non-invasive tests evaluated in the same individuals.
In September, the Company announced the signature of a new licensing agreement with Labcorp for the development and commercial deployment of an LDT integrating NIS4™ technology on the routine clinical care diagnostic test market in
NTZ Development Program in Liver Fibrosis
Despite the COVID-19 pandemic and thanks to the implementation of appropriate measures by the clinical investigator leading the study, the recruitment of patients in the Phase 2 trial evaluating NTZ in NASH-induced liver fibrosis continued throughout the first half of the year.
See also the supplemental Note 6.2 “Major events after the reporting period” to the consolidated H1 2020 financial statements thereafter regarding other events occurring after the reporting period.
Governance
The Company announced, following its annual Shareholders Meeting on
Ms. Kalin’s healthcare industry expertise spans diagnostics, medical devices, and pharmaceuticals.
Mr.
At the time of this report, the Board of Directors has appointed Ms.
APPENDICES
Half-year Consolidated Financial Results
At
The Condensed Consolidated Statements of Financial Position, Statements of Operations and Statements of Cash Flow of the Group were prepared in accordance International Financial Reporting Standards (IFRS).
The limited review procedures on the condensed consolidated financial statements have been performed. The half year consolidated financial statements for the period ended
The condensed consolidated financial statements as well as the notes to the consolidated financial statements for the period ended
Condensed Consolidated Statement of Financial Position
ASSETS | As of | ||
(in € thousands) | |||
Current assets | |||
Cash and cash equivalents | 276 748 | 225 721 | |
Current trade and others receivables | 12 033 | 8 938 | |
Other current assets | 1 968 | 3 540 | |
Inventories | 5 | 5 | |
Total - Current assets | 290 753 | 238 204 | |
Non-current assets | |||
Intangible assets | 920 | 894 | |
Property, plant and equipment | 16 453 | 15 507 | |
Other non-current financial assets | 1 727 | 1 595 | |
Total - Non-current assets | 19 100 | 17 997 | |
Total - Assets | 309 853 | 256 200 | |
SHAREHOLDERS' EQUITY AND LIABILITIES | As of | ||
(in € thousands) | |||
Current liabilities | |||
Current convertible loans | 1 313 | 1 313 | |
Other current loans and borrowings | 3 226 | 3 222 | |
Current trade and other payables | 36 917 | 34 961 | |
Current deferred income and revenue | 140 | 141 | |
Current provisions | 2 061 | 2 070 | |
Total - Current liabilities | 43 657 | 41 706 | |
Non-current liabilities | |||
Non-current convertible loans | 164 142 | 166 760 | |
Other non-current loans and borrowings | 14 939 | 13 342 | |
Non-current trade and other payables | 451 | 451 | |
Non-current employee benefits | 1 408 | 1 503 | |
Deferred tax liabilities | 1 193 | 1 057 | |
Total - Non-current liabilities | 182 132 | 183 112 | |
Shareholders' equity | |||
Share capital | 9 715 | 9 715 | |
Share premium | 377 821 | 378 334 | |
Retained earnings (accumulated deficit) | (238 340) | (303 662) | |
Currency translation adjustment | 14 | 7 | |
Net profit (loss) | (65 145) | (53 011) | |
Total shareholders' equity - Group share | 84 065 | 31 382 | |
Non-controlling interests | — | — | |
Total - Shareholders' equity | 84 065 | 31 382 | |
Total - Shareholders' equity & liabilities | 309 853 | 256 200 |
Condensed Consolidated Statement of Operations
For the six-month period ended | |||
(in € thousands, except earnings per share data) | |||
Revenues and other income | |||
Revenue | 1 | 122 | |
Other income | 5 356 | 5 745 | |
Revenues and other income | 5 357 | 5 867 | |
Operating expenses and other operating income (expenses) | |||
Research and development expenses | (38 908) | (36 867) | |
General and administrative expenses | (9 517) | (8 251) | |
Marketing and market access expenses | (2 876) | (9 491) | |
Other operating income (expenses) | 7 | (423) | |
Operating income (loss) | (45 936) | (49 163) | |
Financial income | 1 755 | 2 095 | |
Financial expenses | (7 240) | (6 102) | |
Financial profit (loss) | (5 485) | (4 007) | |
Net profit (loss) before tax | (51 422) | (53 170) | |
Income tax benefit (expense) | 289 | 159 | |
Net profit (loss) | (51 132) | (53 011) | |
Attributable to owners of the Company | (51 132) | (53 011) | |
Attributable to non-controlling interests | — | — | |
Basic and diluted earnings (loss) per share | |||
Basic and diluted earnings (loss) per share (€/share) | (1,64) | (1,36) |
Condensed Statement of Cash Flows
For the six-month period ended | For the year ended | For the six-month period ended | |
(in € thousands) | |||
Cash flows from operating activities | |||
+ Net profit (loss) | (51 132) | (65 145) | (53 011) |
+ Non-controlling interests | — | — | — |
Reconciliation of net loss to net cash used in operating activities | |||
Adjustments for: | |||
+ Depreciation and amortization on tangible and intangible assets | 1 542 | 3 263 | 1 737 |
+ Impairment and provision for litigation | 1 804 | 357 | 124 |
+ Expenses related to share-based compensation | 356 | 1 657 | 513 |
- Gain on disposal of property, plant and equipment | (1) | (19) | (2) |
+ Net finance expenses (revenue) | 5 669 | 11 437 | 5 848 |
+ Income tax expense (benefit) | (289) | (576) | (159) |
+ Other non-cash items including Research Tax Credit litigation | (11) | 1 702 | 92 |
Operating cash flows before change in working capital | (42 063) | (47 324) | (44 859) |
Change in: | |||
Decrease (increase) in trade receivables and other assets | (10 103) | (1 640) | 1 523 |
(Decrease) increase in trade payables and other liabilities | 5 307 | 1 284 | (2 026) |
Change in working capital | (4 797) | (356) | (504) |
Income tax paid | — | — | — |
Net cash flows used in operating activities | (46 859) | (47 680) | (45 362) |
Cash flows from investment activities | |||
- Acquisition of property, plant and equipment | (65) | (2 030) | (785) |
+ Proceeds from disposal of / reimbursement of property, plant and equipment | (0) | 2 517 | — |
- Acquisition of financial instruments | (128) | (160) | (49) |
Net cash flows provided by (used in ) investment activities | (193) | 327 | (834) |
Cash flows from financing activities | |||
+ Proceeds from issue of share capital (net) | 126 479 | 126 486 | — |
+ Proceeds from subscription / exercise of share warrants | — | 43 | — |
+ Proceeds from new loans and borrowings net of issue costs | — | — | — |
- Repayments of loans and borrowings | (1 513) | (1 884) | (1 601) |
- Financial interests paid (including finance lease) | (3 234) | (7 785) | (3 230) |
Net cash flows provided by (used in ) financing activities | 121 732 | 116 860 | (4 831) |
Increase (decrease) in cash and cash equivalents | 74 680 | 69 508 | (51 027) |
Cash and cash equivalents at the beginning of the period | 207 240 | 207 240 | 276 748 |
Cash and cash equivalents at the end of the period | 281 920 | 276 748 | 225 721 |
Discussion of the 2020 half year results
Comments on the condensed statement of net income for the periods ended
(i) Revenue and other income
The Company's revenue and other income results primarily from the research tax credit.
Revenue and other income | For the six-month period ended | |||
(in € thousands) | ||||
Revenues | 1 | 122 | ||
Government grants and subsidies | 2 | 3 | ||
CIR tax credit | 5 350 | 5 224 | ||
Other operating income | 4 | 519 | ||
TOTAL | 5 357 | 5 867 |
Revenue and other income was € 5,867 thousand at
(ii) Operating expenses and other operating income by destination
The tables below break down operating expenses by destination mainly into research and development expenses on the one hand, marketing and pre-marketing and general and administrative expenses on the other, for the half years ended
Contracted | Gain / | ||||||||
research and | Other | Depreciation, | (loss) on | ||||||
For the | development | expenses | amortization | disposal of | |||||
six-month period | activities | (maintenance, | and | property, | |||||
Operating expenses and other operating income (expenses) | ended | conducted by | Employee | fees, travel, | impairment | plant and | |||
(in € thousands) | third parties | expenses | taxes…) | charges | equipment | ||||
Research and development expenses | (38 908) | (25 909) | (6 206) | (2 564) | — | — | |||
General and administrative expenses | (9 517) | (1) | (4 082) | (5 244) | — | — | |||
Marketing and market access expenses | (2 876) | — | (883) | (1 963) | — | — | |||
Other operating income and (expenses) | 7 | — | — | 6 | 1 | 1 | |||
TOTAL | (51 293) | (25 910) | (11 170) | (9 764) | 1 | 1 | |||
Contracted | Gain / | ||||||||
research and | Other | Depreciation, | (loss) on | ||||||
For the | development | expenses | amortization | disposal of | |||||
six-month period | activities | (maintenance, | and | property, | |||||
Operating expenses and other operating income (expenses) | ended | conducted by | Employee | fees, travel, | impairment | plant and | |||
(in € thousands) | third parties | expenses | taxes…) | charges | equipment | ||||
Research and development expenses | (36 867) | (24 337) | (6 591) | (3 287) | (1 455) | — | |||
General and administrative expenses | (8 251) | (42) | (3 845) | (3 963) | (269) | — | |||
Marketing and market access expenses | (9 491) | (1) | (744) | (8 697) | (44) | — | |||
Other operating income (expenses) | (423) | — | — | (425) | — | 2 | |||
TOTAL | (55 031) | (24 379) | (11 180) | (16 372) | (1 769) | 2 |
Operating expenses in the first half 2020 amounted to €55,031 thousand compared to €51,293 thousand in first half 2019.
They include, in particular:
·research and development expenses, which include employee-related expenses for employees in research and development functions (€6,591 thousand at
The decrease in contracted research and development expenses is mainly due to the suspension or termination of some clinical studies in the context of the COVID-19 pandemic.
Changes in employee-related expenses for employees in research and development functions is mainly due to increased headcount (128 vs. 116), compensated by the absence of incentive bonuses in 2020.
The decrease in amortization and provisions related to research and development is mainly due to the provisions recorded in the dispute with the tax authorities concerning the CIR in 2019 and the application as from
·general and administrative expenses, which include the costs of personnel not assigned to research (€3,845 thousand at
Changes in general and administrative expenses are mainly related to the cost of insurance premiums in relation to Company listing on the Nasdaq.
Changes in employee-related expenses paid to employees in general and administrative functions was primarily the result of an increase in headcount (68 vs. 51 employees), compensated by the absence of incentive bonuses in 2020.
·marketing and pre-marketing expenses, which include the costs of personnel assigned to marketing and business development (€744 thousand in the first half 2020 compared to €883 thousand in the first half 2019), and costs related to the preparation of the commercialization of elafibranor and NIS4™ in NASH (market research, marketing strategy, medical communication, market access…) (€9,491 thousand in the first half 2020 compared to €2,876 thousand in the first half 2019).
Marketing and pre-commercialization expenses will significantly decrease as of the second half 2020 due to the discontinuation of the pre-commercialization work for elafibranor in NASH following the termination of this program in
(iii) Operating expenses by type
Broken down by type instead of by destination, operating expenses mainly included the following:
Contracted research and development activities
Contracted research and development expenses amounted to €24,379 thousand in the first half 2020 compared to €25,910 thousand in the first half 2019, corresponding to a 6% decrease, which is mainly due to the suspension or discontinuation of some studies in the context of the COVID-19 pandemic.
Employee expenses
Employee expenses | For the six-month period ended | ||
(in € thousands) | |||
Wages and salaries | (7 998) | (7 811) | |
Social security costs | (2 748) | (2 770) | |
Changes in pension provision | (69) | (87) | |
Individual training entitlement | — | — | |
Share-based compensation | (356) | (513) | |
TOTAL | (11 170) | (11 180) |
Employee expenses excluding share-based compensation amounted to €10,667 thousand in the first half 2020 compared to €10,814 thousand in the first half 2019, or a 1% decrease, mainly due to the absence of incentive bonuses in 2020 despite an increase in headcount (203 vs. 174 employees)
The amount recognized as share-based compensation (BSA, BSAAR, SO and AGA) free of any impact on cash flow amounted to €513k in the first half 2020 compared to €356 thousand in the first half 2019. The expenses recorded in the first half of 2020 relate to the SO and AGA plans put in place in
Other expenses
Other expenses amount to €16,372 thousand in the first half 2020 compared to €9,764 thousand in the first half 2019. They include, in particular:
- "fees," which include legal, audit, and accounting, the fees of various advisors (press relations, investor relations, communication, IT), as well as the fees of certain scientific advisers. This amount also includes intellectual property expenditures corresponding to fees incurred by the Company in connection with the registration and protection of its patents;
- insurance premiums specific to the listing of the Company’s shares on Nasdaq: a recurring Directors & Officers civil liability insurance policy;
- expenses related to the pre-marketing of elafibranor and NIS4™ in NASH (market research, marketing strategy, medical communication, market access…);
- expenses related to the use and maintenance of Group offices;
- expenses related to external service providers (guard, security, reception, clinical trial management and IT); and
- expenses related to business travel and conferences mainly for employees as well as the costs of participation in scientific, medical, financial, and business development conferences.
These changes are mainly related to increases in expenses for pre-marketing projects.
(iv) Financial income (expense)
Financial income (expense) as of
This change is mainly due to realized and unrealized foreign currency exchange rate loss of €246k in the first half 2020 compared to €1,563k in the first half 2019, partially compensated a notable increase in financial income (€1,154k in the first half 2020 compared to €103k in the first half 20191) due to the increase of cash held in US dollars and to investments in US dollars where the return has been significantly higher than investments in euros.
(v) Net income (loss)
The first half 2020 resulted in a net loss of €53,011 thousand compared to a net loss of €51,132 thousand in the first half 2019. The net loss for the 2019 fiscal year amounted to €65,144 thousand.
Comments on the Group’s Statement of Financial Position at
At
At
(i) Non current assets
Non-current assets, which include trade and other receivables, goodwill and intangible, tangible, and financial assets, decrease from €19,100 thousand as of
(ii) Current assets
Current assets amounted to €238,204 thousand at
Cash and cash equivalents went from €276,748 thousand at
The variation of trade and other receivables is mainly due to the recognition of the estimated amount of the Research Tax Credit receivable for the first half 2020 and the repayment of the Research Tax Credit for 2019 during the first half 2020. Additional details regarding these receivables are provided in note 6.9 to the 2020 half year consolidated financial statements.
The variation of trade and other receivables corresponds to the increase in expenses recognized in advance related to current operating expenses. This increase follows the increase in operating expenses in the first half 2020.
(iii) Shareholders’ equity
As of
The change in the Company's shareholders' equity is mainly due to the recognition of the half year loss reflecting the Company’s efforts in research and development, carrying out pre-clinical studies, and clinical studies related to elafibranor.
The Notes to the 2020 half year consolidated financial statements included herein, as well as the Table of Changes in Shareholders' Equity established under IFRS provide details on the change in the Company's share capital and the Group's shareholders' equity, respectively.
(iv) Non current liabilities
This mainly concerns:
·The convertible bond (OCEANE) issued in
As well as the part of contractual obligations of the following liabilities reaching maturity in more than one year:
- A conditional advance granted to
GENFIT SA byBpifrance for the purpose of financing the research programs detailed in Note 6.12.2.1 "Refundable and Conditional Advances" of the notes to the 2020 half year consolidated financial statements included herein; and
- bank loans; and
- and the debt related to operating leases pursuant to IFRS 16, as of
January 1, 2019 .
- Current liabilities
Liabilities - Current | ||
(in € thousands) | ||
Current convertible loans | 1 313 | 1 313 |
Current other loans and borrowings | 3 226 | 3 222 |
Current trade and other payables | 36 917 | 34 961 |
Current deferred income and revenue | 140 | 141 |
Current provisions | 2 061 | 2 070 |
TOTAL | 43 657 | 41 706 |
This balance sheet item mainly includes interest payments on the OCEANE due
See also notes 6.12 and 6.13 to the consolidated financial statements for the first half of 2020 below.
ABOUT
FORWARD LOOKING STATEMENTS
This press release contains certain forward-looking statements, including those within the meaning of the Private Securities Litigation Reform Act of 1995, with respect to
GENFIT CONTACT
Naomi EICHENBAUM – Investor Relations | Tel: +1 (617) 714 5252 | investors@genfit.com
PRESS RELATIONS | Media
Hélène LAVIN – Press Relations | Tel: +3 33 2016 4000 | Helene.lavin@genfit.com
1 Note: the impact of the reclassification of foreign exchange income from trade receivables recognized as "other income" for the first half of 2020 while these gains were recognized as "financial income" in the first half of 2019 (see note 17 to the 2020 half year condensed consolidated financial statements)
Attachment
GENFIT : First Half-Year 2020 Financial Report and New Corporate Strategy
Source:
2020 GlobeNewswire, Inc., source