0001375151-17-000044.txt : 20170808 0001375151-17-000044.hdr.sgml : 20170808 20170808160445 ACCESSION NUMBER: 0001375151-17-000044 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20170808 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20170808 DATE AS OF CHANGE: 20170808 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ZOGENIX, INC. CENTRAL INDEX KEY: 0001375151 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 205300780 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-34962 FILM NUMBER: 171014689 BUSINESS ADDRESS: STREET 1: 5858 HORTON STREET, #455 CITY: EMERYVILLE STATE: CA ZIP: 94608 BUSINESS PHONE: (510) 550-8300 MAIL ADDRESS: STREET 1: 5858 HORTON STREET, #455 CITY: EMERYVILLE STATE: CA ZIP: 94608 FORMER COMPANY: FORMER CONFORMED NAME: ZOGENIX INC DATE OF NAME CHANGE: 20060911 8-K 1 a8-k6x30x2017er.htm 8-K Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): August 8, 2017
 
ZOGENIX, INC.
(Exact Name of Registrant as Specified in its Charter)
 
 
 
 
 
 
 
Delaware
 
001-34962
 
20-5300780
(State or Other Jurisdiction
of Incorporation)
 
(Commission
File Number)
 
(IRS Employer
Identification No.)
 
 
 
 
5858 Horton Street, Suite 455, Emeryville, CA
 
94608
(Address of Principal Executive Offices)
 
(Zip Code)
Registrant’s telephone number, including area code: (510) 550-8300
(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 August 8, 2017, Zogenix, Inc. issued a press release announcing its financial results for the second quarter ended June 30, 2017. A copy of this press release is attached hereto as Exhibit 99.1.
In accordance with General Instruction B.2 of 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 liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as expressly set forth by specific reference in such filing to this Current Report on Form 8-K.
 
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits.
 
 
 
 
Exhibit
No.
 
Description
 
 
99.1
 
Press Release, dated August 8, 2017




 
 
 



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ZOGENIX, INC.
 
 
 
 
 
Date:
August 8, 2017
 
 
 
By:
 
/s/ Michael P. Smith
 
 
 
 
 
Name:
 
Michael P. Smith
 
 
 
 
 
Title:
 
Executive Vice President, Chief Financial Officer, Treasurer and Secretary




 
 
 



EXHIBIT INDEX
 
 
 
 
Exhibit
No.
 
Description
 
 
99.1
 
Press Release, dated August 8, 2017


 EX-99.1 2 a6-30x2017exhibit991er.htm EXHIBIT 99.1 Exhibit
Exhibit 99.1

Zogenix Provides Corporate Update and Reports Second Quarter 2017 Financial Results

Top-Line Results of First Phase 3 Clinical Trial of ZX008 in Dravet Syndrome Expected in Third Quarter 2017
Second Phase 3 Clinical Trial in Dravet Syndrome, Study 1504, Enrolling According to Plan

Orphan Drug Designation Granted by FDA for ZX008 in Lennox Gastaut Syndrome; Phase 3 Clinical Trial Expected to Begin in Fourth Quarter of 2017

Company Will Host a Conference Call Today at 4:30 p.m. EST/1:30 p.m. PST

EMERYVILLE, California, August 8, 2017—Zogenix, Inc. (NASDAQ: ZGNX), a pharmaceutical company developing therapies for the treatment of orphan and central nervous system (CNS) disorders, today provided a corporate update and announced financial results for the second quarter and six months ended June 30, 2017.

“We remain on target to announce Study 1 top-line results from our ZX008 Phase 3 program in Dravet syndrome late in the third quarter of this year,” said Stephen J. Farr, Ph.D., President and CEO of Zogenix. “The completion of Study 1 will be a significant milestone for our company, as it will represent the culmination of over two years of effort at Zogenix. Importantly, these will be the first results from one of our placebo-controlled, clinical trial evaluating the potential of low-dose fenfluramine as a safe and effective treatment for Dravet syndrome. In addition, our second planned pivotal Phase 3 data readout for Dravet syndrome, Study 1504, has enrolled approximately two-thirds of the total number of subjects targeted for inclusion. We are focused on completing enrollment in Study 1504 by the end of the current quarter.”

“Beyond Dravet syndrome, we were pleased most recently to receive orphan drug designation in the U.S. for ZX008 in Lennox Gastaut Syndrome (LGS), which follows the same distinction received in the EU earlier this year,” continued Dr. Farr. “We have begun preparations that will allow us to initiate a Phase 3 clinical trial for ZX008 in LGS once we announce the top-line data from Study 1.”

Corporate Update

•
Completed enrollment of Study 1 in the Phase 3 program of ZX008 in Dravet syndrome; remain on track to announce top-line safety and efficacy results in the third quarter of 2017
•
Enrollment of second pivotal Phase 3 trial, Study 1504, is now approximately two-thirds complete; focused effort on completing enrollment in the third quarter of 2017
•
Investigational New Drug Application (IND) accepted by U.S. Food and Drug Administration (FDA) to commence Phase 3 clinical trial of ZX008 in LGS in children and adults; preparations underway to initiate trial in the fourth quarter of 2017, following the availability of top-line data from Study 1 in Dravet syndrome
•
Granted orphan drug designation by FDA for ZX008 for the treatment of LGS
•
Presented new data on the mechanism of action of ZX008 at the 72nd Annual Meeting of the Society of Biological Psychiatry
•
Completed second quarter ended June 30, 2017, with $65.8 million in cash and cash equivalents





Second Quarter 2017 Financial Results Compared to Second Quarter 2016
 
•
Total revenue for the second quarter ended June 30, 2017, was $7.1 million, consisting entirely of contract manufacturing revenue. This compared with total revenue of $2.1 million in the second quarter ended June 30, 2016, consisting almost entirely of contract manufacturing revenue. The $5.0 million increase in contract manufacturing revenue in the second quarter of 2017 was primarily due to more Sumavel DosePro units delivered to Endo International.
•
Research and development expenses for the second quarter ended June 30, 2017, totaled $14.9 million, up from $10.4 million in the second quarter ended June 30, 2016, as the Company progressed enrollment and expanded the scope of its Phase 3 clinical trials for ZX008 in Dravet syndrome.
•
Selling, general and administrative expenses for the second quarter ended June 30, 2017, totaled $5.5 million, compared with $6.8 million in the second quarter ended June 30, 2016.
•
Net loss from continuing operations for the second quarter ended June 30, 2017, was $22.5 million, compared with $18.2 million in the second quarter ended June 30, 2016.
•
Net loss from discontinued operations for both the second quarter ended June 30, 2017, and June 30, 2016, was $0.6 million.
•
Total net loss for the second quarter ended June 30, 2017, was $23.0 million, or $0.93 per share, compared with a net loss of $18.8 million, or $0.76 per share, in the second quarter ended June 30, 2016.

Six Months Ended June 30, 2017 Financial Results Compared to Six Months Ended June 30, 2016
•
Total revenue for the six months ended June 30, 2017, was $9.8 million, consisting entirely of contract manufacturing revenue. This compared with total revenue of $11.3 million in the six months ended June 30, 2016, consisting nearly entirely of contract manufacturing revenue. The decrease was primarily attributable to lower reimbursed production costs under the agreement with Endo. In April 2017, we completed fulfillment of the remaining open orders and ceased all manufacturing activities related to Sumavel DosePro.
•
Research and development expenses for the six months ended June 30, 2017, totaled $28.2 million, up from $18.4 million in the six months ended June 30, 2016, as the Company progressed enrollment and expanded the scope of its Phase 3 clinical trials for ZX008 in Dravet syndrome.
•
Selling, general and administrative expenses for the six months ended June 30, 2017, totaled $12.1 million, compared with $13.0 million in the six months ended June 30, 2016.
•
Net loss from continuing operations for the six months ended June 30, 2017, was $43.6 million, compared with $28.5 million in the six months ended June 30, 2016.
•
Net loss from discontinued operations for the six months ended June 30, 2017, was $0.7 million, compared with $0.8 million in the six months ended June 30, 2016.
•
Total net loss for the six months ended June 30, 2017 was $44.3 million, or $1.79 per share, compared with a net loss of $29.2 million, or $1.18 per share, in the six months ended June 30, 2016.
•
At June 30, 2017, the Company had cash and cash equivalents of$65.8 million, compared to $91.6 million at December 31, 2016. The Company believes that it has sufficient funds to support operations into the first half of 2018.






Conference Call Details
Tuesday, August 8th @ 4:30 PM Eastern Time/1:30 PM Pacific Time
Toll Free:        800-279-9534
International:        719-325-2450
Conference ID:        6341528
Webcast:        http://public.viavid.com/index.php?id=125147

Replays, available through August 22, 2017:
Domestic:        844-512-2921
International:        412-317-6671
Replay PIN:        6341528

About Zogenix
 
Zogenix, Inc. (Nasdaq: ZGNX) is a pharmaceutical company committed to developing and commercializing CNS therapies that address specific clinical needs for people living with orphan and other CNS disorders who need innovative treatment alternatives to improve their daily functioning.
For more information, visit www.zogenix.com.
 
Forward Looking Statements
Zogenix cautions you that statements included in this press release that are not a description of historical facts are forward-looking statements. Words such as “believes,” “anticipates,” “plans,” “expects,” “indicates,” “will,” “intends,” “potential,” “suggests,” “assuming,” “designed” and similar expressions are intended to identify forward-looking statements. These statements are based on the Company's current beliefs and expectations. These forward-looking statements include statements regarding ZX008’s potential as a treatment for seizures associated with Dravet syndrome; the enrollment of patients in the on-going Phase 3 clinical trials for ZX008; the timing of top line results for the on-going Phase 3 clinical trials (including Study 1); any IND submission and commencement of a Phase 3 clinical trial in LGS; and the commercial potential of ZX008. The inclusion of forward-looking statements should not be regarded as a representation by Zogenix that any of its plans will be achieved. Actual results may differ from those set forth in this release due to the risks and uncertainties inherent in Zogenix’s business, including, without limitation: the uncertainties associated with the clinical development and regulatory approval of product candidates such as ZX008, including potential delays in the commencement, enrollment and completion of clinical trials; the potential that earlier clinical trials and studies may not be predictive of future results; top-line data from Study 1 may not support our NDA for ZX008 in Dravet syndrome; negative top-line data from Study 1 may delay or prevent commencement of the Phase 3 clinical trial in LGS; Zogenix’s reliance on third parties to conduct its clinical trials, enroll patients, manufacture its preclinical and clinical drug supplies and manufacture commercial supplies of its drug products, if approved; unexpected adverse side effects or inadequate therapeutic efficacy of ZX008 that could limit approval and/or commercialization, or that could result in recalls or product liability claims; Zogenix's ability to fully comply with numerous federal, state and local laws and regulatory requirements, as well as rules and regulations outside the United States, that apply to its product development activities; Fast Track designation may not result in an expedited regulatory review process; and other risks described in Zogenix’s prior press releases as well as in public periodic filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and Zogenix undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement. This caution is made under the safe harbor provisions of Section 21E of the Private Securities Litigation Reform Act of 1995.
 
CONTACT:
Investors:
Andrew McDonald
Founding Partner, LifeSci Advisors LLC
646-597-6987 | Andrew@lifesciadvisors.com





Zogenix, Inc.
Condensed Consolidated Statements of Operations
(In Thousands, except Per Share Amounts)
(Unaudited) 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Revenue:
 
 
 
 
 
 
 
Contract manufacturing revenue
$
7,125

 
$
1,986

 
$
9,821

 
$
11,192

Service and other product revenue
—

 
102

 
—

 
102

Total revenue
7,125

 
2,088

 
9,821

 
11,294

Costs and expenses:
 
 
 
 
 
 
 
Cost of contract manufacturing
8,242

 
2,136

 
10,729

 
10,011

Research and development
14,850

 
10,384

 
28,191

 
18,371

Selling, general and administrative
5,502

 
6,844

 
12,056

 
12,968

Impairment charges
107

 
—

 
920

 
—

Change in fair value of contingent consideration
500

 
1,300

 
1,100

 
2,600

Total costs and expenses
29,201

 
20,664

 
52,996

 
43,950

Loss from operations
(22,076
)
 
(18,576
)
 
(43,175
)
 
(32,656
)
Other income (expense):
 
 
 
 
 
 
 
Interest expense, net
(575
)
 
(623
)
 
(1,152
)
 
(1,221
)
Change in fair value of common stock warrant liabilities
153

 
977

 
740

 
5,504

Other income (expense)
29

 
(15
)
 
9

 
(23
)
Total other (expense) income
(393
)
 
339

 
(403
)
 
4,260

Loss from continuing operations before income taxes
(22,469
)
 
(18,237
)
 
(43,578
)
 
(28,396
)
Income tax benefit (expense)
16

 
(9
)
 
(1
)
 
(71
)
Net loss from continuing operations
(22,453
)
 
(18,246
)
 
(43,579
)
 
(28,467
)
Net loss from discontinued operations
(555
)
 
(582
)
 
(736
)
 
(751
)
Net loss
$
(23,008
)
 
$
(18,828
)
 
$
(44,315
)
 
$
(29,218
)
Net loss per share, basic and diluted:
 
 
 
 
 
 
 
Continuing operations
$
(0.90
)
 
$
(0.74
)
 
$
(1.76
)
 
$
(1.15
)
Discontinued operations
$
(0.03
)
 
$
(0.02
)
 
$
(0.03
)
 
$
(0.03
)
Total
$
(0.93
)
 
$
(0.76
)
 
$
(1.79
)
 
$
(1.18
)
 
 
 
 
 
 
 
 
Weighted average shares outstanding, basic and diluted
24,822

 
24,777

 
24,817

 
24,774








Zogenix, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In Thousands)
 
 
June 30,
2017
 
December 31,
2016
Assets
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
65,761

 
$
91,551

Trade accounts receivable
4,684

 
12,577

Inventory
2,232

 
7,047

Prepaid expenses and other current assets
6,137

 
8,739

Total current assets
78,814

 
119,914

Property and equipment, net
459

 
1,710

Intangible assets
102,500

 
102,500

Goodwill
6,234

 
6,234

Other assets
1,995

 
1,147

Total assets
$
190,002

 
$
231,505

Liabilities and stockholders’ equity
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
1,791

 
$
4,549

Accrued expenses
9,551

 
6,374

Accrued compensation
2,639

 
3,652

Common stock warrant liabilities
69

 
809

Working capital advance note payable, net of discount of $3,493 and $3,733 at June 30, 2017 and December 31, 2016, respectively
3,507

 
3,267

Current portion of long-term debt
3,333

 
—

Deferred revenue
—

 
1,245

Current liabilities of discontinued operations
1,093

 
414

Total current liabilities
21,983

 
20,310

Long term debt
15,757

 
18,824

Contingent consideration
53,900

 
52,800

Deferred income taxes
17,425

 
17,425

Other long-term liabilities
1,455

 
1,390

Stockholders’ equity:
 
 
 
Common stock, $0.001 par value; 50,000 shares authorized; 24,839 and 24,813 shares issued and outstanding at June 30, 2017 and December 31, 2016, respectively
25

 
25

Additional paid-in capital
568,995

 
565,954

Accumulated deficit
(489,538
)
 
(445,223
)
Total stockholders’ equity
79,482

 
120,756

Total liabilities and stockholders’ equity
$
190,002

 
$
231,505