InVivo Therapeutics Reports 2016 First Quarter Financial Results and Business Update

CAMBRIDGE, Mass.--(BUSINESS WIRE)--InVivo Therapeutics Holdings Corp. (NVIV) today reported financial results for the quarter ended March 31, 2016.

Mark Perrin, InVivo’s Chief Executive Officer and Chairman, said, “In the first quarter, we reached significant milestones that have clarified our path to commercialization and increased the likelihood of approval for the Neuro-Spinal Scaffold™ for acute thoracic spinal cord injury. We established a measure of success for the INSPIRE study when we received approval for an amendment that defined the Objective Performance Criterion (OPC) as 25% or more of the patients in the study demonstrating an improvement of at least one ASIA Impairment Scale (AIS) grade by six months post-implantation. Four of the first seven patients in follow-up have converted to date, with one conversion occurring in the first quarter. This 57% rate of conversion exceeds the natural history rate of less than 16% and the OPC threshold of 25%. We now only need one additional patient with an AIS conversion to meet the OPC. In addition to the progress in the clinic, we also successfully raised over $30 million in gross proceeds in a financing in March. We project our funds will last us through the end of 2017, by which time we expect to have filed a Humanitarian Device Exemption (HDE) application for approval of the Neuro-Spinal Scaffold™.”

Financial Results

For the quarter ended March 31, 2016, the company reported a net loss of approximately $6,623,000 or $.24 per diluted share, compared to a net loss of $15,830,000 or $.64 per diluted share, for the quarter ended March 31, 2015. The 2016 results were adversely impacted by a loss in the derivative warrant liability (a non-cash item) of $1,047,000 and the 2015 results were negatively impacted by $10,286,000 in the derivative warrant liability. Excluding the impact of the derivative warrant liability, the quarters ended March 2016 and March 2015 earnings loss per diluted share were $.20 and $.22 respectively.

The company ended the quarter with $45,767,000 of cash and cash equivalents. During the first quarter the company received $29.9 million in net proceeds from the March 2016 public offering

Adjusted net loss and adjusted net loss per share are non-GAAP financial measures that exclude the items noted. A reconciliation of these measures to the comparable GAAP measure is included with the tables contained in this release. The company believes a presentation of these non-GAAP measures provides useful information to investors to better understand the company’s operations, on a period-to-period comparable basis, with financial amounts both including and excluding these identified items.

About InVivo Therapeutics

InVivo Therapeutics Holdings Corp. is a research and clinical-stage biomaterials and biotechnology company with a focus on treatment of spinal cord injuries. The company was founded in 2005 with proprietary technology co-invented by Robert Langer, Sc.D., Professor at Massachusetts Institute of Technology, and Joseph P. Vacanti, M.D., who then was at Boston Children’s Hospital and who now is affiliated with Massachusetts General Hospital. In 2011, the company earned the David S. Apple Award from the American Spinal Injury Association for its outstanding contribution to spinal cord injury medicine. In 2015, the company’s investigational Neuro-Spinal Scaffold received the 2015 Becker’s Healthcare Spine Device Award. The publicly-traded company is headquartered in Cambridge, MA. For more details, visit www.invivotherapeutics.com.

Safe Harbor Statement

Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements within the meaning of the federal securities laws. These statements can be identified by words such as "believe," "anticipate," "intend," "estimate," "will," "may," "should," "expect," “designed to,” “potentially,” and similar expressions, and include statements regarding the safety and effectiveness of the Neuro-Spinal Scaffold, progress toward achievement of OPC for The INSPIRE Study, projections of cash reserves, the timing of the submission of the Humanitarian Device Exemption (HDE) and the likelihood of approval . Any forward-looking statements contained herein are based on current expectations, and are subject to a number of risks and uncertainties. Factors that could cause actual future results to differ materially from current expectations include, but are not limited to, risks and uncertainties relating to the company’s ability to successfully open additional clinical sites for enrollment and to enroll additional patients; the timing of the Institutional Review Board process; the company’s ability to achieve the OPC on a timely basis, or at all; the company’s ability to obtain FDA approval; ; the company’s ability to commercialize its products; the company’s ability to develop, market and sell products based on its technology; the expected benefits and efficacy of the company’s products and technology in connection with the treatment of spinal cord injuries; the likelihood that current funds are sufficient to continue the company’s operations through the end of 2017; the availability of substantial additional funding for the company to continue its operations and to conduct research and development, clinical studies and future product commercialization; and other risks associated with the company’s business, research, product development, regulatory approval, marketing and distribution plans and strategies identified and described in more detail in the company’s Annual Report on Form 10-K for the year ended December 31, 2015, and its other filings with the SEC, including the company’s Form 10-Qs and current reports on Form 8-K. The company does not undertake to update these forward-looking statements

InVivo Therapeutics Holdings Corp. Consolidated Balance Sheets (In thousands, except share and per-share data) (Unaudited)
	As of
	March 31, 2016			December 31, 2015
ASSETS:
Current assets:
Cash and cash equivalents	$	45,767		$	20,194
Restricted cash		361			361
Prepaid expenses and other current assets		617			184
Total current assets		46,745			20,739
Property, equipment and leasehold improvements, net		846			938
Other assets		108			115
Total assets	$	47,699		$	21,792
LIABILITIES AND STOCKHOLDERS’ EQUITY:
Current liabilities:
Accounts payable	$	438		$	521
Loan payable, current portion		403			395
Derivative warrant liability		2,954			1,907
Deferred rent, current portion		122			115
Accrued expenses		871			374
Total current liabilities		4,788			3,312
Loan payable, net current portion		1,171			1,275
Deferred rent, net current portion		242			276
Total liabilities		6,201			4,863
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.00001 par value, authorized 50,000,000 shares; issued and outstanding
31,905,834 and 27,555,948 shares at March 31, 2016 and December 31, 2015,
respectively.		1			1
Additional paid-in capital		181,689			150,497
Accumulated deficit		(140,192	)		(133,569	)
Total stockholders’ equity		41,498			16,929
Total liabilities and stockholders’ equity	$	47,699		$	21,792

InVivo Therapeutics Holdings Corp. Consolidated Statements of Operations (In thousands, except share and per share data) (Unaudited)
	Three Months Ended March 31,
		2016			2015
Operating expenses:
Research and development	$	2,568		$	2,303
General and administrative		2,999			3,208
Total operating expenses		5,567			5,511
Operating loss		(5,567	)		(5,511	)
Other income (expense):
Interest income		54			1
Interest expense		(63	)		(34	)
Derivatives gain (loss)		(1,047	)		(10,286	)
Other income (expense), net		(1,056	)		(10,319	)
Net income (loss)	$	(6,623	)	$	(15,830	)
Net income (loss) per share, basic and
diluted	$	(0.24	)	$	(0.64	)
Weighted average number of common
shares outstanding, basic and diluted		28,171,606			24.909.876

Reconciliation of GAAP to non-GAAP measures
InVivo Therapeutics Holdings Corp.
(In thousands, except share and per share data)
	Three Months Ended
	March 31,
	2016	2015
Reported GAAP net income (loss)	(6,623)	(15,830)
Add Back: Derivative Loss	1,047	10,286
	(5,576)	(5,544)
Reported GAAP net loss per diluted share	(0.24)	(0.64)
Derivative loss per diluted share	0.04	0.42
Adjusted net loss per diluted share	(0.20)	(0.22)