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Organization and Business Activities
6 Months Ended
Jun. 30, 2018
Organization and Business Activities  
Organization and Business Activities

 

1.Organization and Business Activities

 

Nabriva Therapeutics plc (“Nabriva Ireland”), together with its wholly owned and consolidated subsidiaries, Nabriva Therapeutics GmbH (“Nabriva Austria”), Nabriva Therapeutics US, Inc., Nabriva Therapeutics Ireland DAC, and Nabriva Therapeutics One DAC (In Voluntary Liquidation) (collectively, “Nabriva”, the “Nabriva Group” or the “Company”) is a clinical stage biopharmaceutical company engaged in the research and development of novel anti-infective agents to treat serious infections, with a focus on the pleuromutilin class of antibiotics. The Company’s headquarters are located at 25-28 North Wall Quay, Dublin, Ireland.

 

On June 23, 2017, Nabriva Therapeutics plc, a public limited company organized under the laws of Ireland, or Nabriva Ireland, became the successor issuer to Nabriva Therapeutics AG, a stock corporation (Aktiengesellschaft) organized under the laws of Austria, or Nabriva Austria, for certain purposes under both the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, or the Exchange Act. Such succession occurred following the conclusion of a tender offer related to the exchange of American Depositary Shares and common shares of Nabriva Austria for ordinary shares of Nabriva Ireland, which resulted in Nabriva Ireland, a new Irish holding company, becoming the ultimate holding company of Nabriva Austria (the predecessor registrant and former ultimate holding company) and its subsidiaries, which we refer to as the Redomiciliation Transaction. On October 19, 2017, Nabriva Austria was converted into a limited liability company under Austrian law and renamed Nabriva Therapeutics GmbH.

 

On July 23, 2018, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”),with Zavante, a  biopharmaceutical company focused on developing CONTEPO (fosfomycin for injection) to improve the outcomes of hospitalized patients (the “Acquisition”). The Acquisition is discussed in further detail in Note 11 – “Subsequent Events” below.

 

Liquidity

 

Since its inception, the Company has incurred net losses and generated negative cash flows from its operations. To date, it has financed its operations through the sale of equity securities, convertible debt financings and research and development support from governmental grants and loans. As of June 30, 2018, the Company had cash, cash equivalents and short-term investments of $75.5 million.

 

The Company follows the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 205-40, Presentation of Financial Statements - Going Concern (“ASC 205-40”), which requires management to assess the Company’s ability to continue as a going concern for one year after the date the financial statements are issued.

 

As of the date of this filing , management assessed the Company’s ability to continue as a going concern and determined that it expects that its existing cash, cash equivalents and short-term investments, together with the net proceeds from the Company’s July 2018 Public Offering (as defined below), as well as anticipated near-term milestone payments under its license agreement with Sinovant Sciences, Ltd. and anticipated research premiums from the Austrian government for its qualified 2017 research and development expenditures, will be sufficient to enable the Company to fund its operating expenses and capital expenditure requirements into the first quarter of 2020, subject to a successful commercial launch in the United States of lefamulin for CABP and CONTEPO for cUTI in 2019. The Company has based this estimate on assumptions that may prove to be wrong, and the Company could use its capital resources sooner than it currently expects.

 

The Company’s expenses will increase if it suffers any regulatory delays or is required to conduct additional clinical trials to satisfy regulatory requirements. If the Company obtains marketing approval for lefamulin, CONTEPO or any other product candidate that it develops, it expects to incur significant commercialization expenses related to product sales, marketing, distribution and manufacturing.  The Company will continue to invest in critical pre-commercialization and supply chain activities prior to potentially receiving marketing approval and making lefamulin and CONTEPO available to patients.

 

The Company expects to seek additional funding in future periods for purposes of investment in its commercial and medical affairs organization as well as investing in its supply chain, including building active pharmaceutical ingredient safety stock for the commercial supply of lefamulin and CONTEPO, in an effort to enhance the potential commercial launch of lefamulin and CONTEPO.

 

In March 2018, the Company entered into a Controlled Equity OfferingSM Sales Agreement (the “ATM Agreement”), with Cantor Fitzgerald & Co. (“Cantor”), pursuant to which, from time to time, the Company may offer and sell its ordinary shares having aggregate gross proceeds of up to $50.0 million through Cantor. As of June 30, 2018, the Company has issued and sold an aggregate of 4,243,096 ordinary shares under the ATM Agreement, for gross proceeds of $22.8 million, and net proceeds of $22.2 million, after deducting commissions. No ordinary shares have been issued and sold under the ATM agreement since June 30, 2018.

 

On July 31, 2018, the Company completed the underwritten public offering of 18,181,818 ordinary shares at a public offering price of $2.75 per share, resulting in gross proceeds of $50.0 million and net proceeds to the Company of $46.1 million, after deducting underwriting discounts and commissions and offering expenses (the “Public Offering”).