EX-99.2 3 proformafinancials.htm EXHIBIT 99.2 Exhibit


Unaudited pro forma consolidated financial information

On August 15, 2016 at a special meeting of stockholders, Eleven Biotherapeutics, Inc. (the “Company”) obtained stockholder approval authorizing the transactions contemplated by the License Agreement, dated as of June 10, 2016 (the “License Agreement”), by and between the Company, F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc. (collectively, "Roche") relating to EBI-031 and all other IL-6 antagonist antibody technology owned by the Company, including the grant of the exclusive licenses thereunder. As a result of obtaining such stockholder approval, the License Agreement became effective on August 16, 2016.

The following supplemental pro forma information is presented for informational purposes only, to provide an understanding of the Company’s historical financial results as adjusted for the License Agreement. These pro forma condensed financial statements should not be considered a substitute for the actual historical financial information prepared in accordance with generally accepted accounting principles, as presented in the Company’s filings on Form 10-Q and 10-K. The unaudited pro forma condensed financial information disclosed in this report is for illustrative purposes only and is not necessarily indicative of results of operations that would have been achieved had the pro forma events taken place on the dates indicated, or our future results of operations.

The License Agreement represents a substantial outlicense of most rights and obligations concerning EBI-031 and all other IL-6 antagonist antibody technology, such that the Company would not expect to have any further direct involvement in its ongoing development and commercialization of the technology that is subject to the License Agreement. Among other customary closing conditions, Roche negotiated the License Agreement to be contingent upon obtaining shareholder approval of the arrangement, which occurred on August 15, 2016.

The unaudited pro forma condensed statements of operations for the six months ended June 30, 2016 and for the year ended December 31, 2015 present our condensed results of operations giving pro forma effect to the License Agreement as if it had occurred on January 1, 2015. The unaudited condensed pro forma balance sheet as of June 30, 2016 presents the financial position giving effect to the License Agreement as if it had occurred on June 30, 2016. These pro forma condensed financial statements should be read in connection with the Company’s historical condensed financial statements for the period ended June 30, 2016 which were included in the Form 10-Q filed on August 12, 2016 and the Company’s historical financial statements for the year ended December 31, 2015, which were included in the Form 10-K filed on March 25, 2016.

The pro forma adjustments are based on currently available information, estimates and assumptions that the Company believes are reasonable in order to reflect, on a pro forma basis, the impact of this License Agreement on its historical financial information.























ELEVEN BIOTHERAPEUTICS, INC.
UNAUDITED CONDENSED PRO FORMA STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
FOR THE SIX MONTHS ENDED JUNE 30, 2016
($, in thousands, except per share amounts)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pro Forma
 
 
 
 
 
 
 
 
 
 
 
Historical
 
Adjustments
 
Notes
 
Pro Forma
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
$
506

 
 
 
 
 
$
506

Operating expenses:
 
 
 
 
 
 
 
 
Research and development
7,930

 
(2,752
)
 
(a)
 
5,178

 
General and administrative
5,618

 
 
 
 
 
5,618

 
 
 
 
 
Total operating expenses
13,548

 
(2,752
)
 
 
 
10,796

Loss from operations
(13,042
)
 
2,752

 
 
 
(10,290
)
Other income (expense):
 
 
 
 
 
 
 
 
Other income, net
139

 
 
 
 
 
139

 
Loss on extinguishment of debt
(915
)
 
 
 
 
 
(915
)
 
Interest expense, net
(247
)
 
 
 
 
 
(247
)
 
 
 
 
 
Total other expense
(1,023
)
 
—

 
 
 
(1,023
)
Net loss and comprehensive loss
$
(14,065
)
 
$
2,752

 
 
 
$
(11,313
)
 
 
 
 
 
 
 
 
Net loss per share applicable to common stockholders—basic and diluted
$
(0.71
)
 
 
 
 
 
$
(0.57
)
 
 
 
 
 
 
 
 
Weighted-average number of common shares used in net loss per share applicable to common stockholders—basic and diluted
19,756

 
 
 
 
 
19,756


























ELEVEN BIOTHERAPEUTICS, INC.
UNAUDITED CONDENSED PRO FORMA STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
FOR THE YEAR ENDED DECEMBER 31, 2015
($, in thousands, except per share amounts)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pro Forma
 
 
 
 
 
 
 
 
 
 
 
Historical
 
Adjustments
 
Notes
 
Pro Forma
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Collaboration revenue
$
490

 
 
 
 
 
$
490

Other revenue
500

 
 
 
 
 
500

 
 
 
 
 
Total revenue
990

 
—

 
 
 
990

Operating expenses:
 
 
 
 
 
 
 
 
Research and development
26,336

 
(5,384
)
 
(a)
 
20,952

 
General and administrative
9,850

 
 
 
 
 
9,850

 
 
 
 
 
Total operating expenses
36,186

 
(5,384
)
 
 
 
30,802

Loss from operations
(35,196
)
 
5,384

 
 
 
(29,812
)
Other income (expense):
 
 
 
 
 
 
 
 
Other income, net
3,139

 
 
 
 
 
3,139

 
Interest expense, net
(1,395
)
 
 
 
 
 
(1,395
)
 
 
 
 
 
Total other expense
1,744

 
—

 
 
 
1,744

Net loss and comprehensive loss
$
(33,452
)
 
$
5,384

 
 
 
$
(28,068
)
 
 
 
 
 
 
 
 
Net loss per share applicable to common stockholders—basic and diluted
$
(1.76
)
 
 
 
 
 
$
(1.48
)
 
 
 
 
 
 
 
 
Weighted-average number of common shares used in net loss per share applicable to common stockholders—basic and diluted
18,993

 
 
 
 
 
18,993





























ELEVEN BIOTHERAPEUTICS, INC.
UNAUDITED CONDENSED PRO FORMA BALANCE SHEET
AS OF JUNE 30, 2016
($, in thousands, except share and per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pro Forma
 
 
 
 
 
 
 
 
 
 
 
 
Historical
 
Adjustments
 
Notes
 
Pro Forma
Assets
 
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
8,484

 
$
29,900

 
(b)
 
$
38,384

 
Prepaid expenses and other current assets
 
350

 
(38
)
 
(a)
 
312

 
 
 
 
 
Total current assets
 
8,834

 
29,862

 
 
 
38,696

Property and equipment, net
 
314

 
 
 
 
 
314

Restricted cash
 
119

 
 
 
 
 
119

Other assets
 
—

 
 
 
 
 
—

Total assets
 
$
9,267

 
$
29,862

 
 
 
$
39,129

Liabilities and stockholders' equity
 
 
 
 
 
 
 
 
Current liabilities
 
 
 
 
 
 
 
 
 
Accounts payable
 
$
1,855

 
(232
)
 
(a)
 
$
1,623

 
Accrued expenses
 
1,153

 
(114
)
 
(a)
 
1,039

 
Notes payable, current portion
 
—

 
 
 
 
 
—

 
Deferred revenue, current portion
 
—

 
 
 
 
 
—

 
 
 
 
 
Total current liabilities
 
3,008

 
(346
)
 
 
 
2,662

Other Liabilities
 
73

 
 
 
 
 
73

Accrued interest
 
—

 
 
 
 
 
—

Notes payable, net of current portion
 
—

 
 
 
 
 
—

Warrant liability
 
13

 
 
 
 
 
13

Commitments and contingencies
 
 
 
 
 
 
 
 
Stockholders' equity
 
 
 
 
 
 
 
 
 
Common stock, $0.001 par value; 200,000,000 shares authorized at
June 30, 2016 and December 31, 2015, respectively, and 20,005,771 and 19,619,124 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively
 
20

 
 
 
 
 
20

 
Additional paid-in capital
 
145,420

 
 
 
 
 
145,420

 
Accumulated deficit
 
(139,267
)
 
30,208

 
 
 
(109,059
)
Total stockholders' equity
 
6,173

 
30,208

 
 
 
36,381

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities and stockholders' equity
 
$
9,267

 
$
29,862

 
 
 
$
39,129







(a)
To eliminate the direct research and development expenses, prepaid expenses, accounts payable and accrued expenses associated with EBI-031. We have not reflected employee and contractor-related costs, costs associated with our platform and facility expenses, including depreciation or other indirect costs, as a pro forma adjustment as these costs are deployed across multiple product programs under research and development and are not directly related to EBI-031.

(b)
To record the up-front license fee of $7.5 million and the first development milestone payment of $22.5 million (minus the exclusivity fee of $0.1 million) as a non-recurring one-time payment under the License Agreement, and presented as an opening balance sheet pro forma adjustment of $29.9 million, that was receivable at the time the License Agreement became effective. The License Agreement includes payments of an upfront license fee of $7.5 million payable within 30 days after achievement of specified regulatory, development and commercial milestones with respect to up to two unrelated indications. Specifically, an aggregate amount of up to $197.5 million is payable to the Company for the achievement of specified milestones with respect to the first indication: $72.5 million in development milestones, $50.0 million in regulatory milestones and $75.0 million with respect to the first indication: $72.5 million in development milestones, $50.0 million in regulatory milestones and $75.0 million in commercialization milestones. The first development milestone in the amount of $22.5 million is payable as a result of the IND application for EBI-031 which became effective July 7, 2016. Additional amounts of up to $65.0 million are payable upon the achievement of specified development and regulatory milestones in a second indication.