MONTREAL, QUEBEC–(Marketwired – March 15, 2018) – Knight Therapeutics Inc. (TSX:GUD) (“Knight”), a leading Canadian specialty pharmaceutical company, today reported financial results for its fourth quarter and year ended December 31, 2017. All dollar amounts are in thousands except for share and per share amounts. All currencies are Canadian unless otherwise specified.

2017 Highlights

Financial Results

  • Revenues were $8,634, an increase of $2,694 or 45% over prior year
  • Net income was $17,244, a decrease of $1,316 or 7% versus prior year
  • Cash flows from operations at $23,457, an increase of $8,719 or 59% over prior year


  • Announced the commercialization of Movantik® in Canada
  • Submitted Iluvien® for approval for the treatment of diabetic macular edema to Health Canada, and received a Notice of Non-Compliance from Health Canada related to the submission subsequent to year end
  • Submitted Probuphine® for approval for the treatment of opioid drug dependence to Health Canada

Strategic Lending and Investments

  • Issued additional loans of US$16,303 to Synergy CHC Corp (“Synergy”) and 60º Pharmaceuticals LLC (“60P”)
  • Received a total of US$19,283 on early repayment of strategic loans from Apicore Inc. and Pro Bono Bio plc.
  • Amended loan with Crescita Therapeutics Inc. (“Crescita”) resulting in an early repayment of $2,488
  • Received additional 1,577,363 common shares of Medimetriks Pharmaceuticals Inc. (“Medimetriks”) initially valued at US$2,453
  • Received dividends of $4,984 from Medison Biotech (1995) Ltd. (“Medison”)
  • Received distributions of $8,083 from strategic fund investments and realized a gain of $2,077
  • Realized gain of $1,457 on disposal of common shares of Merus Labs International Inc. upon the close of its acquisition by Norgine B.V.

Key Subsequent Events

  • Submitted Netildex™ for approval for the treatment of inflammatory ocular conditions of the anterior segment of the eye to Health Canada
  • Received US$22,757 from Medimetriks including the early payment of principal of US$20,000, interest and fees
  • Received US$4,460 as a partial repayment of the 60P loan

“We are pleased to report that 2017 marked a pivotal year for Knight’s simple yet meaningful mission to make people better through the products we sell. In 2017, we launched our first commercial prescription pharmaceutical in Canada,” said Jonathan Ross Goodman, CEO of Knight. “While we continue to advance our pipeline, building Canada’s leading specialty pharmaceutical company is a marathon, not a sprint, and will take time. We continue to view our balance sheet as a significant competitive advantage and remain confident that our patience and focus on securing the rights to innovative products at fair prices will pay healthy dividends in the future.”

As at December 31, 2017, Knight had over $765,000 in cash, cash equivalents and marketable securities. From this strong cash position, Knight will continue to pursue business and corporate development opportunities.

Financial Results

  Q4-17 Q4-16 Change   2017 2016 Change  
  $1   %2   $1   %2  
Revenues 2,544 1,845 699   38 % 8,634 5,940 2,694   45 %
Gross margin 2,056 1,372 684   50 % 7,049 4,390 2,659   61 %
Operating expenses 3,266 3,692 426   12 % 14,326 11,789 (2,537 ) 22 %
Interest income 7,783 6,099 1,684   28 % 26,300 24,414 1,886   8 %
Share of net income of associate 341 38 303   797 % 854 2,793 (1,939 ) 69 %
Net income 7,145 7,939 (794 ) 10 % 17,244 18,560 (1,316 ) 7 %
Basic earnings per share 0.05 0.06 (0.01 ) 17 % 0.12 0.15 (0.03 ) 20 %
1 A positive variance represents a positive impact to net income and a negative variance represents a negative impact to net income
2 Percentage change is presented in absolute values

Revenue and gross margin: Increase in 2017 is due to addition and growth of Movantik® and an increase in Impavido® sales.

Operating expenses: Increase in the year is explained by commercial activities including promotion of Movantik®, and an increase in the number of employees as Knight expands commercialization and prepares to launch new products in Canada.

Interest income: Increase in 2017 is driven by a higher balance of cash and marketable securities, increasing interest rates, and higher interest accretion related to strategic loans.

Share of net income of associate: Decrease in 2017 is due to Medison’s lower net income mainly attributable to increases in marketing and selling expenses linked to new product launches as well as to an increase in the amortization of fair value adjustments recorded by Knight.

Product Updates

According to IQVIA data, Movantik® sales in Canada grew by 68% in 2017 and were $936. In December 2016, Knight entered into an agreement with AstraZeneca for the rights to Movantik® in Canada and Israel under which Knight is responsible for all commercial, regulatory and certain supply chain activities. Movantik® is the first once-daily oral peripherally-acting mu-opioid receptor antagonist for the treatment of opioid-induced constipation in adult patients with non-cancer pain who have had an inadequate response to laxative(s).

Knight has submitted three products for approval by Health Canada approval since the start of 2017. Probuphine® is a subdermal implant designed to deliver buprenorphine continuously for six months for the treatment of opioid drug dependence, promoting patient compliance and retention. Iluvien® is a sustained release intravitreal implant for the treatment of diabetic macular edema. Netildex™ is a fixed combination of netilmicin and dexamethasone for the treatment of inflammatory ocular conditions of the anterior segment of the eye, in presence or at risk of bacterial infection. If approved, the launch of the Iluvien®, Probuphine® and Netildex™ will be key to the continued expansion of our commercial presence in Canada. Subsequent to year end, Knight received a Notice of Non-Compliance from Health Canada regarding its submission for Iluvien. Knight plans to respond to Health Canada’s issues within the prescribed 90-day window.

Strategic Lending and Investment Updates 

On August 9, 2017, Knight issued an additional three-year secured loan of US$10,000 with an annual interest rate of 10.5% to Synergy. As part of the transaction, Knight will receive a success fee upon maturity of the loan.

On August 14, 2017, Knight amended its loan with Crescita. The amendment resulted in an early repayment of $2,488 reducing the principal balance to $4,100. Additionally, Knight agreed to amend the collateral on the loan with the release of a letter of credit in exchange for a general security interest over Crescita’s assets. The interest rate of 9% per annum and maturity date of January 22, 2022 remain unchanged. On March 12, 2018, Knight subscribed for 754,716 shares of Crescita for $400 following the exercise of rights received as part of a Crescita rights offering. As at March 14, 2018, Knight owns a total of 2,834,689 common shares of Crescita representing approximately 13.5% of its common shares oustanding.

During 2017, Knight issued an additional US$6,303 under its loan agreement with 60P. As at December 31, 2017, Knight had issued a total of US$9,145 to 60P at an interest rate of 15% per annum with a maturity date of December 31, 2020. On February 8, 2018, 60P repaid US$4,460 of the outstanding loan amount. In addition, pursuant to its loan agreements with Medimetriks, Knight received an additional 1,577,363 common shares of Medimetriks in 2017, increasing its ownership to 15.6% on a fully diluted basis as at December 31, 2017. On March 7, 2018, Knight received an early repayment from Medimetriks for principal of US$20,000 and interest and fees.

Conference Call Notice 

Knight will host a conference call and audio webcast to discuss its fourth quarter and year end results today at 8:30 am ET. Knight cordially invites all interested parties to participate in this call.

Date: Thursday, March 15, 2018
Time: 8:30 a.m. EST
Telephone: 1-877-223-4471 or 647-788-4922
Webcast: or
This is a listen-only audio webcast. Media Player is required to listen to the broadcast.
Replay: An archived replay will be available for 30 days at

About Knight Therapeutics Inc. 

Knight Therapeutics Inc., headquartered in Montreal, Canada, is a specialty pharmaceutical company focused on acquiring or in-licensing innovative pharmaceutical products for the Canadian and select international markets. Knight Therapeutics Inc.’s shares trade on TSX under the symbol GUD. For more information about Knight Therapeutics Inc., please visit the company’s web site at or

Forward-Looking Statement

This document contains forward-looking statements for Knight Therapeutics Inc. and its subsidiaries. These forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. Knight Therapeutics Inc. considers the assumptions on which these forward-looking statements are based to be reasonable at the time they were prepared, but cautions the reader that these assumptions regarding future events, many of which are beyond the control of Knight Therapeutics Inc. and its subsidiaries, may ultimately prove to be incorrect. Factors and risks, which could cause actual results to differ materially from current expectations are discussed in Knight Therapeutics Inc.’s Annual Report and in Knight Therapeutics Inc.’s Annual Information Form for the year ended December 31, 2017. Knight Therapeutics Inc. disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information or future events, except as required by law.

[In thousands of Canadian dollars]
As at December 31, 2017 2016
Cash and cash equivalents 496,460 514,942
Marketable securities 232,573 221,108
Trade and other receivables 9,176 6,440
Inventories 1,224 790
Other current financial assets 58,848 51,789
Income taxes receivable 792 4,683
Total current assets 799,073 799,752
Marketable securities 36,000
Property and equipment 633 32
Intangible assets 12,576 14,153
Other financial assets 76,988 90,643
Investment in associate 75,983 80,113
Deferred income tax assets 4,730 6,077
Total assets 1,005,983 990,770
Accounts payable and accrued liabilities 5,025 3,207
Income taxes payable 7,599 5,659
Other balances payable 1,354 537
Deferred other income 282 355
Total current liabilities 14,260 9,758
Deferred other income 167 417
Other balances payable 348 877
Total liabilities 14,775 11,052
Shareholders’ equity    
Share capital 761,490 760,447
Warrants 785 785
Contributed surplus 12,196 9,469
Accumulated other comprehensive income 20,907 30,431
Retained earnings 195,830 178,586
Total shareholders’ equity 991,208 979,718
Total liabilities and shareholders’ equity 1,005,983 990,770


[In thousands of Canadian dollars, except for share and per share amounts]  
  2017   2016  
Revenues 8,634   5,940  
Cost of goods sold 1,585   1,550  
Gross margin 7,049   4,390  
Selling and marketing 3,378   532  
General and administrative 8,198   9,302  
Research and development 2,750   1,955  
  (7,277 ) (7,399 )
Depreciation of property and equipment 8   18  
Amortization of intangible assets 1,621   419  
Interest income (26,300 ) (24,414 )
Other income (1,527 ) (3,894 )
Net gain on financial assets (6,734 ) (1,659 )
Impairment on financial assets 1,621    
Share of net income of associate (854 ) (2,793 )
Foreign exchange loss 3,689   1,451  
Income before income taxes 21,199   23,473  
Income tax expense        
Current 1,897   4,190  
Deferred 2,058   723  
Net income for the year 17,244   18,560  
Attributable to shareholders of the Company        
Basic earnings per share 0.12   0.15  
Diluted earnings per share 0.12   0.15  
Weighted average number of common shares outstanding        
Basic 142,763,730   120,723,270  
Diluted 143,416,666   121,263,522  


[In thousands of Canadian dollars]  
  2017   2016  
Net income for the year 17,244   18,560  
Adjustments reconciling net income to operating cash flows:        
  Deferred tax 2,058   723  
  Share-based compensation expense 3,038   3,640  
  Depreciation and amortization 1,629   437  
  Accretion of interest (5,382 ) (6,201 )
  Realized gain on financial assets (4,421 ) (2,569 )
  Unrealized (gain) loss on financial assets (2,313 ) 910  
  Impairment on financial assets 1,621    
  Foreign exchange loss 3,689   1,451  
  Share of net income from associate (854 ) (2,793 )
  Other income (563 ) (1,274 )
  Deferred other income (323 ) 479  
  15,423   13,363  
Changes in non-cash working capital related to operations 3,050   (3,462 )
Dividends from associate 4,984   4,837  
Cash inflow from operating activities 23,457   14,738  
Purchase of marketable securities (314,358 ) (535,685 )
Purchase of intangibles   (9,853 )
Purchase of property and equipment (126 ) (7 )
Issuance of loans receivables (20,112 ) (43,274 )
Purchase of equities (2,939 ) (16,371 )
Investment in funds (21,314 ) (16,503 )
Proceeds from sale of marketable securities 259,067   544,812  
Proceeds from repayments of loans receivable 38,835   11,324  
Proceeds from disposal of equities 12,872   9,572  
Proceeds from distribution of funds 8,083   4,610  
Proceeds from disposal of derivatives   2,157  
Cash outflow from investing activities (39,992 ) (49,218 )
Proceeds from share issuance, net of costs   313,574  
Proceeds from exercise of stock options 551    
Proceeds from contributions to share purchase plan 195   105  
Issuance of share purchase loans   (350 )
Cash inflow from financing activities 746   313,329  
(Decrease) increase in cash during the year (15,789 ) 278,849  
Cash and cash equivalents, beginning of the year 514,942   237,481  
Net foreign exchange difference (2,693 ) (1,388 )
Cash and cash equivalents, end of the year 496,460   514,942  
Marketable securities, end of the year 268,573   221,108  
Cash, cash equivalents and marketable securities, end of the year 765,033   736,050