osir_Current_Folio_8K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): November 7, 2018

 

OSIRIS THERAPEUTICS, INC.

(Exact Name of Registrant as Specified in Charter)

 

Maryland

 

001-32966

 

71-0881115

(State or other jurisdiction of
incorporation)

 

(Commission
File Number)

 

(IRS Employer
Identification No.)

 

7015 Albert Einstein Drive, Columbia, Maryland

 

21046

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code: (443) 545 - 1800

 

Not Applicable

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

 

 

 


 

Item 2.02.  Results of Operations and Financial Condition

 

On November 7, 2018, Osiris Therapeutics, Inc. (the “Company”) announced its financial results for the quarter ended September 30, 2018.  The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

 

The information in this Current Report on Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing made by the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

 

Item 9.01.  Financial Statements and Exhibits

 

(d)     Exhibits

 

 

 

 

Exhibit
Number

    

Description of Exhibit

99.1Press Release issued by the Company on November 7, 2018

 

2


 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

 

OSIRIS THERAPEUTICS, INC.

 

 

 

Dated: November 7, 2018

By:

/s/ JOEL ROGERS

 

 

Joel Rogers

 

 

Chief Financial Officer

 

3


osir_Current_Folio_Ex99-1

Exhibit 99.1

 

Picture 1

 

 

OSIRIS THERAPEUTICS, INC REPORTS THIRD QUARTER 2018 RESULTS

 

COLUMBIA, MARYLAND, November 7, 2018 (GLOBE NEWSWIRE) - Osiris Therapeutics, Inc. (NASDAQ: OSIR), a regenerative medicine company focused on developing and marketing products for wound care, orthopedics, and sports medicine,  today reported its results for the third quarter ending September 30, 2018.

 

Business Highlights

 

·

GrafixPL PRIMETM launched on October 1, 2018

·

Enrollment of patients in a clinical trial evaluating GrafixPL PRIME in the treatment of chronic venous leg ulcers

·

Company re-listed on the Nasdaq Global Market on August 1, 2018

 

Quarterly Financial Summary

 

Revenue was $36.5 million for the three-month period ended September 30, 2018, which increased $6.7 million or 22.4%, compared to revenue of $29.8 million for the three-month period ended September 30, 2017.  The increase in revenue was primarily due to higher Grafix®/Stravix® revenue of $5.6 million as a result of increased demand from market awareness and acceptance as we increased selling efforts in the operating room and surgical settings as well as hospital outpatient wound care centers.  In addition, we received a one-time settlement payment of $1.3 million from a former distributor that was accounted for on a cash basis, as collection was not reasonably assured, to settle amounts owed to us from previous years, primarily 2015 and 2016.  BIO revenue increased $1.1 million, or 18.1%, due to increased demand from our distribution arrangement with Stryker.    

 

Gross profit was $26.7 million for the three-month period ended September 30, 2018, which increased $4.8 million or 22.0%, compared with gross profit of $21.9 million for the three-month period ended September 30, 2017.  This increase was primarily due to higher revenues and the collection of the $1.3 million settlement from a former distributor that was accounted for on a cash basis, which did not have any cost of revenue as the cost of revenue was recognized in the periods the product was shipped.

 

Cash flow from operations was $8.1 million for the three-month period ended September 30, 2018, which was driven by net income of $4.2 million, collection of outstanding accounts receivable of $2.9 million, and the add back of the non-cash accrued shareholder litigation expense of $0.9 million.

 

See the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of our Quarterly Report on Form 10-Q filed today with the Securities and Exchange Commission for additional information concerning our operating results for the three- and nine month periods ended September 30, 2018.

 


 

About Osiris Therapeutics

 

Osiris Therapeutics, Inc., based in Columbia, Maryland, researches, develops, manufactures and commercializes regenerative medicine products intended to improve the health and lives of patients and lower overall healthcare costs.  We have achieved commercial success with products in orthopedics, sports medicine and wound care, including the Grafix product line, Stravix®, BIO and Cartiform®.  We continue to advance our research and development by focusing on innovation in regenerative medicine, including the development of bioengineered stem cell and tissue‑based products.  Osiris®, Grafix®, GrafixPL®, GrafixPL PRIME Cartiform®, and Prestige Lyotechnologysm are our trademarks. BIO is a trademark of Howmedica Osteonics Corp., a subsidiary of Stryker Corporation. More information can be found on the Company’s website, www.Osiris.com. (OSIR-G)

 

Forward-Looking Statements

 

Statements herein relating to the future of Osiris Therapeutics, Inc. and the ongoing research and development of our products are forward-looking statements.  Osiris Therapeutics, Inc. cautions that these forward looking statements are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those expressed or implied by such statements.  These risks and uncertainties include those identified under the heading “Risk Factors” in the Osiris Therapeutics Inc. Annual Report on Form 10-K for the years ended December 31, 2017, 2016 and 2015 and Quarterly Report on Form 10-Q for the quarters ended March 31, 2018, June 30, 2018 and September 30, 2018 as filed with the Securities and Exchange Commission (SEC).  We caution investors not to place considerable reliance on the forward-looking statements contained in this press release.  Examples of forward-looking statements may include, without limitation, statements regarding the anticipated efficiencies and advantages of products and the likelihood of customer clinical adoption of any new products.  Although well characterized in scientific literature and studies, preservation of tissue integrity, including cells, may not be indicative of clinical outcome.  Accordingly, you should not unduly rely on these forward-looking statements. You are encouraged to read our filings with the SEC, available at sec.gov, for a discussion of these and other risks and uncertainties.  The forward-looking statements in this press release speak only as of the date of this document, and we undertake no obligation to update or revise any of the statements.  Our business is subject to substantial risks and uncertainties, including those referenced above. Investors, potential investors, and others should give careful consideration to these risks and uncertainties.

 

For additional information, please contact:

Diane Savoie

Osiris Therapeutics, Inc.

(443) 545-1834

OsirisPR@Osiris.com 

 

 

 

 

FINANCIAL TABLES TO FOLLOW


 

OSIRIS THERAPEUTICS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands, except per share data)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

December 31,

 

 

 

2018

 

2017

    

Assets

    

 

 

    

 

 

 

Current assets

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

31,658

 

$

3,081

 

Short-term investments

 

 

8,701

 

 

24,807

 

Trade receivables, net

 

 

20,592

 

 

26,053

 

Inventory, net

 

 

10,576

 

 

11,278

 

Insurance receivable

 

 

4,788

 

 

4,788

 

Prepaid expenses and other current assets

 

 

3,421

 

 

2,920

 

Total current assets

 

 

79,736

 

 

72,927

 

Property and equipment, net

 

 

3,116

 

 

3,587

 

Other assets

 

 

1,849

 

 

1,608

 

Total assets

 

$

84,701

 

$

78,122

 

 

 

 

 

 

 

 

 

Liabilities and Equity

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Accounts payable

 

$

4,291

 

$

5,269

 

Accrued liabilities

 

 

10,704

 

 

9,399

 

Accrued shareholder litigation

 

 

19,400

 

 

18,500

 

Other current liabilities

 

 

1,994

 

 

1,934

 

Total current liabilities

 

 

36,389

 

 

35,102

 

Other long-term liabilities

 

 

2,450

 

 

1,626

 

Total liabilities

 

 

38,839

 

 

36,728

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

Common stock, $0.001 par value, 72,000 shares authorized, 34,526 shares issued and outstanding at September 30, 2018, and 90,000 shares authorized, 34,526 shares issued and outstanding at December 31, 2017

 

 

35

 

 

35

 

Additional paid-in-capital

 

 

284,124

 

 

283,905

 

Accumulated other comprehensive loss

 

 

(330)

 

 

(208)

 

Accumulated deficit

 

 

(237,967)

 

 

(242,338)

 

Total equity

 

 

45,862

 

 

41,394

 

Total liabilities and equity

 

$

84,701

 

$

78,122

 

 


 

OSIRIS THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(amounts in thousands, except per share data)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

    

 

    

2018

    

2017

    

2018

    

2017

    

Revenue

 

$

36,491

 

$

29,806

 

$

102,001

 

$

85,938

 

Cost of revenue

 

 

9,808

 

 

7,926

 

 

28,333

 

 

23,405

 

Gross profit

 

 

26,683

 

 

21,880

 

 

73,668

 

 

62,533

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

1,590

 

 

909

 

 

4,886

 

 

3,052

 

Sales and marketing

 

 

15,931

 

 

14,825

 

 

49,107

 

 

44,256

 

General and administrative

 

 

4,302

 

 

6,634

 

 

15,150

 

 

16,920

 

Shareholder litigation expense

 

 

900

 

 

 —

 

 

900

 

 

 —

 

Total operating expenses

 

 

22,723

 

 

22,368

 

 

70,043

 

 

64,228

 

Income (loss) from continuing operations

 

 

3,960

 

 

(488)

 

 

3,625

 

 

(1,695)

 

Other (expense) income, net

 

 

(21)

 

 

(1,763)

 

 

548

 

 

(1,371)

 

Income (loss) before income taxes from continuing operations

 

 

3,939

 

 

(2,251)

 

 

4,173

 

 

(3,066)

 

Income tax (expense) benefit

 

 

(100)

 

 

198

 

 

(170)

 

 

134

 

Income (loss) from continuing operations

 

 

3,839

 

 

(2,053)

 

 

4,003

 

 

(2,932)

 

Discontinued operations, net of tax

 

 

368

 

 

9,811

 

 

368

 

 

9,811

 

Net income

 

 

4,207

 

 

7,758

 

 

4,371

 

 

6,879

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized (loss) gain on investments

 

 

(100)

 

 

(21)

 

 

(122)

 

 

33

 

Comprehensive income

 

$

4,107

 

$

7,737

 

$

4,249

 

$

6,912

 

Net income (loss) per share from continuing operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.11

 

$

(0.06)

 

$

0.12

 

$

(0.08)

 

Diluted

 

$

0.11

 

$

(0.06)

 

$

0.12

 

$

(0.08)

 

Net income per share from discontinued operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.01

 

$

0.28

 

$

0.01

 

$

0.28

 

Diluted

 

$

0.01

 

$

0.28

 

$

0.01

 

$

0.28

 

Net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.12

 

$

0.22

 

$

0.13

 

$

0.20

 

Diluted

 

$

0.12

 

$

0.22

 

$

0.13

 

$

0.20

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

34,526

 

 

34,526

 

 

34,526

 

 

34,524

 

Diluted

 

 

34,594

 

 

34,526

 

 

34,565

 

 

34,525

 

 

 

 


 

OSIRIS THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(amounts in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30,

 

 

 

2018

    

2017

    

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

 

Net income

 

$

4,371

 

$

6,879

 

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

Receipt of Mesoblast common stock

 

 

 —

 

 

(10,000)

 

Shareholder litigation expense

 

 

900

 

 

 —

 

Provision for excess and obsolete inventory

 

 

1,238

 

 

180

 

Loss on disposal of fixed assets

 

 

 —

 

 

123

 

Realized loss on investments

 

 

240

 

 

2,102

 

Depreciation

 

 

658

 

 

518

 

Stock-based compensation expense

 

 

219

 

 

49

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Accounts receivables, net

 

 

5,461

 

 

1,220

 

Inventory, net

 

 

(536)

 

 

(1,228)

 

Prepaid expenses and other assets

 

 

(742)

 

 

(651)

 

Accounts payable, accrued liabilities, and other liabilities

 

 

1,211

 

 

(1,791)

 

Net cash provided by (used in) operating activities

 

 

13,020

 

 

(2,599)

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(187)

 

 

(718)

 

Proceeds from sale of investments

 

 

16,248

 

 

23,250

 

Purchases of investments

 

 

(504)

 

 

(19,660)

 

Net cash provided by investing activities

 

 

15,557

 

 

2,872

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

Proceeds from the exercise of options to purchase common stock

 

 

 —

 

 

128

 

Net cash provided by financing activities

 

 

 —

 

 

128

 

NET INCREASE IN CASH AND CASH EQUIVALENTS

 

 

28,577

 

 

401

 

Cash and cash equivalents at beginning of period

 

 

3,081

 

 

2,833

 

Cash and cash equivalents at end of period

 

$

31,658

 

$

3,234