Interim report January – June 2017

OUR THREE LARGEST BRANDS ARE DEVELOPING WELL

"Kerasal Nail® reached a market share of 29%, while at the same time, we have expanded distribution for both Dermoplast® and New Skin®. Enrolment for the MOB-015 study has taken longer than expected but is accelerating after corrective measures have been implemented," says Peter Wolpert, CEO Moberg Pharma.

*The comparative figures include a capital gain in Q2 2016 of SEK 41.1 million from the divestment of the Jointflex®, Fergon® and Vanquish® brands

** Excluding capital gain                     

SIGNIFICANT EVENTS DURING THE SECOND QUARTER

• Extended distribution for Dermoplast® via Walmart and CVS
• Sara Brandt elected as new Board member
• Redemptions of stock option schemes increased the number of shares and votes by 28,920
  

SIGNIFICANT EVENTS AFTER THE END OF THE QUARTER

• Successful results from the clinical trial for Kerasal Nail®/ Emtrix®
  

CONFERENCE CALL

CEO Peter Wolpert will present the report at a telephone conference today August 8, 2017 at 3:00 p.m. CET. Telephone: SE +46-8-566 426 95 US: +1 646 502 51 20

ABOUT THIS INFORMATION

Moberg Pharma discloses the information provided herein pursuant to the Securities markets Act and/or the Financial Instruments Trading Act. The information was submitted for publication at 8:00 am (CET) on August 8th, 2017.

STATEMENT FROM THE CEO

After a year of significant acquisitions, direct sales in the United States represent about 90% of our total sales. We are aggressively investing in our 3 largest brands, accounting for the bulk of the company's earnings, with positive initial response to our expanded growth plans. Meanwhile, our pipeline progresses with two Phase 3 programs whose revenue potential exceeds that of our current portfolio by far. Enrolment for the MOB-015 study has taken longer than expected but is accelerating after several corrective measures have been implemented. We are also taking the commercialization plans for MOB-015 to the next level.

During the second quarter, sales increased by 91% to SEK 136 million, of which 2% was organic growth. EBITDA[1] was strengthened by SEK 18 million to SEK 10 million. Marketing efforts are seasonal, peaking during the second quarter (55%[2]  of sales) and contributing to sales and profitability going forward. We expect stronger cash flow in the second half of the year following the seasonality of our business, as well as the release of a one-off item of SEK 18 million.

Sales for both New Skin® and Dermoplast® are developing according to plan and the two brands are now fully integrated into business operations where they are now, next to Kerasal Nail®, responsible for an increasing proportion of our turnover and profitability. The initial response on the new marketing campaigns for New Skin® are highly promising and contributed with 27% growth[3] in sales to consumers.

We are in the middle of the high season for Kerasal Nail®, whose market share continues to grow to 29%[4], thanks to, among other things, a refined marketing strategy that includes strong television advertising and impactful in-store messaging. According to a recently published clinical trial, Kerasal Nail®/Emtrix® are providing noticeable effects on both nail fungus and nail psoriasis after only one week of treatment. The positive study results will enable stronger claims in all markets in the future and the results for nail psoriasis are very interesting as there are currently no treatment options for these patients.

After the product acquisitions in the United States, distributor sales represent about 10% and a declining share of our total sales. However, we have good profitability in these markets and see a significant long-term potential for our portfolio in markets outside of the United States. The launch in Japan is going according to expectations and the retail network is being expanded. It is too early to draw any far-reaching conclusions about these developments, but the signals we are receiving are positive. In China, however, local regulations are restricting the effective marketing of our current product and, in the short term, we are therefore dampening our expectations. For MOB-015, China remains a highly interesting market with considerable potential.

Enrolment for the two Phase 3 studies of MOB-015 has taken longer than expected. We have taken a number of measures to speed up the process and are now on the right track, however enrolment will likely not be completed this year with somewhat higher costs as a result. Nevertheless, our assessment is that overall consequences are limited.

During the second quarter, we provided our input on the Indian Phase 3 study application for BUPI to our partner Cadila Pharmaceuticals. Submission preparations by Cadila are in the final stages.

Over the next 12 months, I will be based at our office in New Jersey, USA, but with regular presence at our head office in Stockholm. The purpose is to spend time working closely with our American team, existing and potential partners in the United States and to intensify interaction with American investors. It is an advantage to be able to work with the commercialization preparations for MOB-015 on site in the United States, which will become the most important market for this product. I very much look forward to this and the additional opportunities we can create for the company through an increased presence in the United States.  

Peter Wolpert, CEO Moberg Pharma

[1] Exclusive of capital gain in Q2 2016 of SEK 41.1 million

[2] Selling expenses excluding depreciation/amortization of product rights

[3] During Q2 2017 compared with the previous year, Top 5 Customer Combined Point of Sale Data.

[4] U.S. MULO,  last 52 weeks ending June 10 2017, SymphonyIRI

FOR FURTHER INFORMATION, PLEASE CONTACT

Peter Wolpert, CEO, tel. +46 (0)8-522 307 00, peter.wolpert@mobergpharma.se
Anna Ljung, CFO, tel. +46 (0)8-522 307 01, anna.ljung@mobergpharma.se    

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