MONTREAL, May 10, 2018 — Knight Therapeutics Inc. (TSX:GUD) (“Knight”), a leading Canadian specialty pharmaceutical company, today reported financial results for its first quarter ended March 31, 2018. All dollar amounts are in thousands except for share and per share amounts. All currencies are Canadian unless otherwise specified.

Q1 2018 Highlights 


  • Revenues were $3,154, an increase of $1,404 or 80% over prior period
  • Net income was $6,909, an increase of $862 or 14% over prior period
  • Cash flows from operations at $6,864, an increase of $2,628 or 62% over prior period
  • Cash, cash equivalents and marketable securities of $802,425 as at March 31, 2018


  • Submitted Netildex™ for approval to Health Canada
  • Entered into an exclusive Canadian licensing agreement with Ardelyx to commercialize tenapanor

Strategic Lending and Investments

  • Received US$22,757 from Medimetriks Pharmaceuticals Inc. (“Medimetriks”) for partial loan repayment, interest and fees
  • Received US$4,460 as a partial repayment of the 60° Pharmaceuticals LLC (“60P”) loan
  • Acquired an additional 754,716 common shares of Crescita Therapeutics Inc. (“Crescita”) through a rights offering at $0.53 per share
  • Exercised option to convert $500 debenture of Antibe Therapeutics Inc. into 2,489,889 common shares

Key Subsequent Events

  • Received regulatory approval from Health Canada for Probuphine™
  • Amended loan with 60P and committed to loan an additional amount of up to US$2,100

“This past quarter we continued on our path to building a leading specialty pharmaceutical company. We licensed tenapanor, submitted Netildex™ and received regulatory approval for Probuphine™”, said Jonathan Ross Goodman, CEO of Knight. “In the meantime, we continue to leverage our balance sheet for GUD returns as evidenced by repayments received from Medimetriks and 60P.”

Select Financial Results
  Q1-18 Q1-17 $1   %2  
Revenues 3,154 1,750 1,404   80 %
Gross margin 2,320 1,462 858   59 %
Operating expenses 3,373 3,247 (126 ) 4 %
Interest income 5,288 5,860 (572 ) 10 %
Share of net income of associate 503 319 184   58 %
Net income 6,909 6,047 862   14 %
Basic earnings per share 0.05 0.04 0.01   25 %

A positive variance represents a positive impact to net income and a negative variance represents a negative impact to net income
Percentage change is presented in absolute values

Revenue and gross margin: Increase is mainly attributable to timing of sales orders for Impavido® and increase in Movantik® sales. According to IQVIA data, Movantik® sales in Canada were $301 for the three-month period ended March 31, 2018 versus $168 for the same period last year.

Operating expenses: Increase in the year is explained by commercial activities including promotion of Movantik®, offset by a reduction in general and administrative expenses mainly related to lower stock based compensation expense. 

Interest income: Interest income is driven by the sum of interest income and interest accretion. Interest income (excluding accretion) for Q1-18 was $5,288, an increase of 10% or $506 compared to Q1-17 driven by an increase in the average cash, cash equivalents and marketable securities balances and an increase in interest rates, offset by a lower average loan balance. As a result of the company's adoption of IFRS 9, there was no significant interest accretion in Q1-18 compared to $1,073 in prior period.

Net income: Net income for the quarter was driven by the above-mentioned items as well as: (i) other income of $1,351 (Q1-17: $308) due to the early repayment of fees on the Medimetriks loan, (ii) a net gain on revaluation of financial assets measured at fair value through profit or loss of $541 (Q1-17: nil), and (iii) a foreign exchange gain of $2,597 (Q1-17: loss of $243) from the relative gains on certain U.S. dollar denominated financial assets as Canadian dollar weakened.

Product Updates

On February 15, 2018, Health Canada accepted Knight's New Drug Submission for Netildex™ for review. 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.

On March 13, 2018, Knight received a Notice of Non-Compliance regarding its submission for Iluvien® and will respond to Health Canada's issues within the prescribed 90-day window. Iluvien® is a sustained release intravitreal implant for the treatment of diabetic macular edema.

On March 16, 2018, Knight entered into an exclusive licensing agreement with Ardelyx to commercialize tenapanor in Canada. Tenapanor is a first-in-class small molecule treatment that has completed Phase 3 development for   IBS-C and is being evaluated in a second Phase 3 study for hyperphosphatemia. Knight expects to submit tenapanor to Health Canada in 2019.

On April 18, 2018, Probuphine™ was approved by Health Canada for the treatment of opioid drug dependence. Probuphine™ is a subdermal implant designed to deliver buprenorphine continuously for six months following a single treatment, promoting patient compliance and retention. Knight expects to launch Probuphine™ by the end of 2018.

Strategic Lending Update 

On April 24, 2018, Knight amended its loan agreement with 60P and committed to lend an additional amount of up to US$2,100, at an interest rate of 15%, to support the regulatory approval and commercialization of tafenoquine. As consideration for the amendment, 60P committed to pay Knight an additional US$3,000 plus annual interest of 9% on April 23, 2023 (“60P Commitment”).  Under the terms of the 60P Commitment, Knight has the right to convert the 60P Commitment into common shares of 60P at a pre-determined exercise price at any time prior to the maturity date. Furthermore, 60P and Knight will enter into an exclusive license agreement granting Knight the right to commercialize tafenoquine in Latin America.

Conference Call Notice 

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

Date: Thursday, May 10, 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.


Knight Therapeutics Inc.
Samira Sakhia
President and Chief Financial Officer
T: 514-678-8930
F: 514-481-4116

[In thousands of Canadian dollars]
As at March 31, 2018 December 31, 2017
Cash and cash equivalents 583,408 496,460
Marketable securities 183,017 232,573
Trade and other receivables 10,046 9,176
Inventories 994 1,224
Other current financial assets 25,167 58,848
Income taxes receivable 819 792
Total current assets 803,451 799,073
Marketable securities 36,000 36,000
Property and equipment 675 633
Intangible assets 15,906 12,576
Other financial assets 79,669 76,988
Investment in associate 77,697 75,983
Deferred income tax assets 3,455 4,730
Total assets 1,016,853 1,005,983
Accounts payable and accrued liabilities 4,592 5,025
Income taxes payable 7,962 7,599
Other balances payable 1,394 1,354
Deferred other income 251 282
Total current liabilities 14,199 14,260
Deferred other income 104 167
Other balances payable 1,067 348
Total liabilities 15,370 14,775
Shareholders' equity    
Share capital 761,546 761,490
Warrants 785 785
Contributed surplus 12,741 12,196
Accumulated other comprehensive income 11,459 20,907
Retained earnings 214,952 195,830
Total shareholders' equity 1,001,483 991,208
Total liabilities and shareholders' equity 1,016,853 1,005,983

[In thousands of Canadian dollars, except for share and per share amounts]
  Three months ended March 31,
  2018   2017  
Revenues 3,154   1,750  
Cost of goods sold 834   288  
Gross margin 2,320   1,462  
Selling and marketing 789   363  
General and administrative 2,095   2,468  
Research and development 489   416  
  (1,053 ) (1,785 )
Depreciation of property and equipment 16      
Amortization of intangible assets 441   326  
Interest income (5,288 ) (5,860 )
Other income (1,351 ) (308 )
Net gain on financial assets –    (3,375 )
Net gain on financial assets measured at fair value through profit or loss (541 )    
Share of net income of associate (503 ) (319 )
Foreign exchange (gain) loss (2,597 ) 243  
Income before income taxes 8,770   7,508  
Income tax expense    
Current 641   480  
Deferred 1,220   981  
Net income for the period 6,909   6,047  
Attributable to shareholders of the Company  
Basic earnings per share 0.05   0.04  
Diluted earnings per share .05   0.04  
Weighted average number of common shares outstanding  
Basic 142,813,358   142,720,536  
Diluted 143,220,006   143,526,773  

[In thousands of Canadian dollars]
    Three-months ended March 31,
    2018   2017  
Net income for the period   6,909   6,047  
Adjustments reconciling net income to operating cash flows:      
Deferred tax   1,220   981  
Share-based compensation expense   545   846  
Depreciation and amortization   457   326  
Accretion of interest   –    (1,078 )
Realized gain on financial assets   –    (976 )
Unrealized gain on financial assets   (541 ) (2,399 )
Foreign exchange (gain) loss   (2,597 ) 204   
Share of net income of associate   (503 ) (319 )
Other income   –    (155 )
Deferred other income   (94 ) (146 )
    5,396   3,331  
Changes in non-cash working capital related to operations   1,468   905  
Cash inflow from operating activities   6,864   4,236  
Purchase of marketable securities   (50,755 ) (44,291 )
Purchase of intangible   (3,000 )    
Purchase of property and equipment   (42 )    
Purchase of equities   (400 ) (2,819 )
Investment in funds   (4,277 ) (4,141 )
Proceeds on maturity of marketable securities   101,318   20,486  
Proceeds from repayments of loans receivable   33,440   28,058  
Proceeds from disposal of equities       709  
Proceeds from distribution of funds   343   2,154  
Cash inflow from investing activities   76,627   156  
Proceeds from exercise of stock options       345  
Proceeds from contributions to share purchase plan   49   43  
Cash inflow from financing activities   49   388  
Increase in cash during the period   83,540   4,780  
Cash and cash equivalents, beginning of the period   496,460   514,942  
Net foreign exchange difference   3,408   (200 )
Cash and cash equivalents, end of the period   583,408   519,522  
Marketable securities, end of the period   219,017   244,256  
Cash, cash equivalents and marketable securities, end of the period   802,425   763,778  

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