Biofrontera Inc. Reports Second Quarter 2024 Financial Results and Provides a Business Update
Woburn, MA, Aug. 14, 2024 (GLOBE NEWSWIRE) — Biofrontera Inc. (NASDAQ:BFRI) (the “Company”), a biopharmaceutical company specializing in the commercialization of dermatologic products, today reported financial results for the three and six months ended June 30, 2024 and provided a business update.
Highlights from the second quarter of 2024 and subsequent weeks included the following:
- Total revenues for the second quarter of 2024 were $7.8 million, a 34% increase from the same period of the prior year
- Cash and cash equivalents were $4.4 million as of June 30, 2024, compared with $1.3 million on December 31, 2023
- Biofrontera announced the launch of a new, FDA-approved red-light source, the RhodoLED® XL lamp in June and installed several lamps by June 30th, 2024
- Took control of all clinical trials relating to Ameluz® in the US, allowing for more effective cost management and direct oversight of trial efficiency
- Biofrontera raised an additional $8.0M in May 2024 from the exercise of warrants and has since paid down all outstanding debt
Hermann Luebbert, Chief Executive Officer and Chairman of Biofrontera Inc., stated, “This was a very exciting period for us as we got our sales and marketing efforts in full swing during the first half of the year. Additionally, on June 10th we launched the commercial distribution of the RhodoLED XL and I am pleased to say that we shipped the first three machines within 1 week of launch. The RhodoLED XL is approved by the FDA in combination with Ameluz®.”
“On June 1st, under the amended Ameluz License and Supply Agreement, we took control of all clinical trials relating to Ameluz® in the US, allowing direct interaction with participating clinical centers. The reduced transfer price will allow us to finance R&D activities and continue our commercial growth trajectory, while reducing our overall costs,” concluded Prof. Luebbert
Second Quarter Financial Results
Total revenues for the second quarter of 2024 were $7.8 million compared with $5.8 million for the second quarter of 2023. The increase is due in part to a catch-up from lower sales in 1Q driven by reimbursement challenges stemming from the Change Healthcare cyber security event.
Total operating expenses were $12.9 million for the second quarter of 2024 compared with $14.5 million for the second quarter of 2023. Cost of revenues was $4.3 million for the second quarter of 2024 compared with $2.9 million for the prior-year quarter, with the increase driven by increased sales. Selling, general and administrative expenses were $7.9 million for the second quarter of 2024 compared with $11.5 million for the second quarter of 2023. The decrease was primarily driven by our continued effort to control cost and lower legal expenses compared to the same period in 2023.
The net loss for the second quarter of 2024 was $257 thousand, compared with a net loss of $9.8 million, for the prior-year quarter. The decrease in the net loss is attributed to lower selling, general, and administrative costs as well as changes in non-cash P&L items including the fair value of warrants and investments in related parties.
Adjusted EBITDA for the second quarter of 2024 was negative $4.7 million compared with negative $7.9 million for the second quarter of 2023, reflecting our lower selling, general, and administrative costs. We look at Adjusted EBITDA, a non-GAAP financial measure, as a better indication of ongoing operations and this measurement is defined as net income or loss excluding interest income and expense, income taxes, depreciation and amortization, and certain other non-recurring or non-cash items.
Please refer to the table below which presents a GAAP to non- GAAP reconciliation of Adjusted EBITDA for the second quarters of 2024 and 2023.
Six Month Financial Results
Total revenues were $15.8 million for the first half of 2024 compared with $14.6 million for the first half of 2023. This 8.2% increase was primarily driven by continued penetration of the photodynamic therapy and cryotherapy AK market segments.
Total operating expenses were $26.3 million for the first half of 2024 compared with $28.8 million for the first half of 2023. Cost of revenues increased slightly from the prior year to $8.5 million for the first six months of 2024 compared to $7.5 million for the first half of 2023. Selling, general and administrative expenses decreased to $17.2 million compared to $21.4 million in the prior year. The decrease was primarily driven by our continued effort to control cost and lower legal expenses compared to the same period in 2023.The net loss for the first half of 2024 was $10.7 million, compared with a net loss of $17.3 million for the first half of 2023.
Adjusted EBITDA was negative $9.3 million for the first half of 2024 compared with negative $11.9 million for the first half of 2023.
Conference Call Details
Conference call: Thursday, August 15, 2024 at 10:00 AM ET
Toll Free: 1-877-877-1275 (U.S. toll-free)
International: 1-412-858-5202
Webcast: https://event.choruscall.com/mediaframe/webcast.html?webcastid=bU2HFqrt
About Biofrontera Inc.
Biofrontera Inc. is a U.S.-based biopharmaceutical company commercializing a portfolio of pharmaceutical products for the treatment of dermatological conditions with a focus on photodynamic therapy (PDT) and topical antibiotics. The Company’s licensed products are used for the treatment of actinic keratoses, which are pre-cancerous skin lesions, as well as impetigo, a bacterial skin infection. For more information, visit www.biofrontera-us.com and follow Biofrontera on LinkedIn and Twitter.
Contacts Investor Relations
Andrew Barwicki
1-516-662-9461
ir@bfri.com
Forward-Looking Statements
Certain statements in this press release may constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements relating to the Company’s revenue guidance, business and marketing strategy, revenue growth, sales force productivity, growth strategy, liquidity and cash flow, potential to expand the label of Ameluz®, available market opportunities for Ameluz®, ongoing clinical trials, educational outreach efforts, and other statements that are not historical facts. The words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential”, “target”, “goal”, “assume”, “would”, “could” or similar words are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We have based these forward-looking statements on our current expectations and projections about future events; nevertheless, actual results or events could differ materially from the plans, intentions and expectations disclosed in, or implied by, the forward-looking statements we make. These risks and uncertainties, many of which are beyond our control, include, but are not limited to, our reliance on sales of products we license from other companies as our sole source of revenue; the success of our competitors in developing generic topical dermatological products that successfully compete with our licensed products; the success of our principal licensed product, Ameluz®; the ability of the Company’s licensors to establish and maintain relationships with contract manufacturers that are able to supply the Company with enough of the licensed products to meet our demand; the ability of our licensors or their manufacturing partners to supply the licensed products that we market in sufficient quantities and at acceptable quality and cost levels, and to fully comply with current good manufacturing practice or other applicable manufacturing regulations; the ability of our licensors to successfully defend or enforce patents related to our licensed products; the availability of insurance coverage and medical expense reimbursement for our licensed products; the impact of legislative and regulatory changes; competition from other pharmaceutical and medical device companies and existing treatments, such as simple curettage and cryotherapy; the Company’s ability to achieve and sustain profitability; the Company’s ability to obtain additional financing as needed to implement its growth strategy; the Company’s ability to retain and hire key personnel; and other factors that may be disclosed in the Company’s filings with the Securities and Exchange Commission (“SEC”), which can be obtained on the SEC website at www.sec.gov. Readers are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date on which they are made and reflect management’s current estimates, projections, expectations and beliefs. The Company does not undertake to update any such forward-looking statements and expressly disclaims any duty to update the information contained in this press release, except as required by law.
(Tables follow)
BIOFRONTERA INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except par value and share amounts)
| June 30, 2024 | December 31, 2023 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 4,379 | $ | 1,343 | ||||
| Investment, related party | 10 | 78 | ||||||
| Accounts receivable, net | 3,504 | 5,162 | ||||||
| Inventories, net | 3,946 | 10,908 | ||||||
| Prepaid expenses and other current assets | 473 | 425 | ||||||
| Other assets, related party | 5,159 | 5,159 | ||||||
| Total current assets | 17,471 | 23,075 | ||||||
| Property and equipment, net | 101 | 134 | ||||||
| Operating lease right-of-use assets | 1,230 | 1,612 | ||||||
| Intangible asset, net | 2,448 | 2,629 | ||||||
| Other assets | 324 | 482 | ||||||
| Total assets | $ | 21,574 | $ | 27,932 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | 2,413 | 3,308 | ||||||
| Accounts payable, related parties | 2,265 | 5,698 | ||||||
| Operating lease liabilities | 701 | 691 | ||||||
| Accrued expenses and other current liabilities | 3,593 | 4,487 | ||||||
| Short term debt | 296 | 3,904 | ||||||
| Total current liabilities | 9,268 | 18,088 | ||||||
| Long-term liabilities: | ||||||||
| Warrant liabilities | 921 | 4,210 | ||||||
| Operating lease liabilities, non-current | 443 | 804 | ||||||
| Other liabilities | 31 | 37 | ||||||
| Total liabilities | 10,663 | 23,139 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Series B Convertible Preferred stock, $0.001 par value, 20,000,000 shares authorized, no Series B-1, 4,806 Series B-2 and 7,998 Series B-3 shares issued and outstanding as of June 30, 2024 and no shares issued and outstanding as of December 31, 2023 | – | – | ||||||
| Common stock, $0.001 par value, 35,000,000 shares authorized; 5,094,184 and 1,517,628 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively | 5 | 2 | ||||||
| Additional paid-in capital | 121,250 | 104,441 | ||||||
| Accumulated deficit | (110,344 | ) | (99,650 | ) | ||||
| Total stockholders’ equity | 10,911 | 4,793 | ||||||
| Total liabilities and stockholders’ equity | $ | 21,574 | $ | 27,932 | ||||
BIOFRONTERA INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts and number of shares)
(Unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Product revenues, net | $ | 7,831 | $ | 5,830 | $ | 15,732 | $ | 14,544 | ||||||||
| Revenues, related party | 8 | 18 | 18 | 36 | ||||||||||||
| Total revenues, net | 7,839 | 5,848 | 15,750 | 14,580 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Cost of revenues, related party | 4,092 | 2,772 | 8,038 | 7,319 | ||||||||||||
| Cost of revenues, other | 250 | 116 | 421 | 167 | ||||||||||||
| Selling, general and administrative | 7,915 | 11,456 | 17,163 | 21,254 | ||||||||||||
| Selling, general and administrative, related party | 32 | 92 | 29 | 119 | ||||||||||||
| Research and development | 621 | 11 | 637 | 11 | ||||||||||||
| Change in fair value of contingent consideration | – | 100 | – | (100 | ) | |||||||||||
| Total operating expenses | 12,910 | 14,547 | 26,288 | 28,770 | ||||||||||||
| Loss from operations | (5,071 | ) | (8,699 | ) | (10,538 | ) | (14,190 | ) | ||||||||
| Other income (expense) | ||||||||||||||||
| Change in fair value of warrants | 5,438 | 375 | 2,009 | 1,403 | ||||||||||||
| Change in fair value of investment, related party | (14 | ) | (1,482 | ) | (11 | ) | (4,424 | ) | ||||||||
| Loss on debt extinguishment | – | – | (316 | ) | – | |||||||||||
| Interest expense, net | (596 | ) | (79 | ) | (2,003 | ) | (114 | ) | ||||||||
| Other income, net | 6 | 62 | 186 | 30 | ||||||||||||
| Total other income (expense) | 4,834 | (1,124 | ) | (135 | ) | (3,105 | ) | |||||||||
| Loss before income taxes | (237 | ) | (9,823 | ) | (10,673 | ) | (17,295 | ) | ||||||||
| Income tax expense | 20 | 14 | 21 | 20 | ||||||||||||
| Net loss | $ | (257 | ) | $ | (9,837 | ) | $ | (10,694 | ) | $ | (17,315 | ) | ||||
| Loss per common share: | ||||||||||||||||
| Basic and diluted | $ | (0.05 | ) | $ | (7.23 | ) | $ | (2.45 | ) | $ | (12.73 | ) | ||||
| Weighted-average common shares outstanding: | ||||||||||||||||
| Basic and diluted | 5,091,353 | 1,360,739 | 4,357,474 | 1,359,894 | ||||||||||||
BIOFRONTERA INC.
GAAP TO NON-GAAP ADJUSTED EBITDA RECONCILIAITION
(In thousands, except per share amounts and number of shares)
(Unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net loss | $ | (257 | ) | $ | (9,837 | ) | $ | (10,694 | ) | $ | (17,315 | ) | ||||
| Interest expense, net | 596 | 79 | 2,003 | 114 | ||||||||||||
| Income tax expenses | 20 | 14 | 21 | 20 | ||||||||||||
| Depreciation and amortization | 130 | 253 | 258 | 518 | ||||||||||||
| EBITDA | 489 | (9,491 | ) | (8,412 | ) | (16,663 | ) | |||||||||
| Loss on debt extinguishment | – | – | 316 | – | ||||||||||||
| Change in fair value of contingent consideration | – | 100 | – | (100 | ) | |||||||||||
| Change in fair value of warrant liabilities | (5,438 | ) | (375 | ) | (2,009 | ) | (1,403 | ) | ||||||||
| Change in fair value of investment, related party | 14 | 1,482 | 11 | 4,424 | ||||||||||||
| Legal settlement expenses | – | 107 | – | 1,225 | ||||||||||||
| Stock based compensation | 204 | 259 | 432 | 610 | ||||||||||||
| Expensed issuance costs | – | – | 354 | – | ||||||||||||
| Adjusted EBITDA | $ | (4,731 | ) | $ | (7,918 | ) | $ | (9,308 | ) | $ | (11,907 | ) | ||||
| Adjusted EBITDA margin | -60.3 | % | -135.4 | % | -59.1 | % | -81.7 | % | ||||||||
