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partners while maintaining an uninterrupted level of service and supply. The
company today provides the second COVID-19 Oslo Stock Exchange notification to
ensure updated and transparent stakeholder information.
“The pandemic continues to bring tremendous hardship on those affected by the
virus; families, communities and business. The Photocure team expresses its
sincere gratitude to the many healthcare professionals around the world
providing lifesaving care and support. Our main priority is to ensure safe
operations and an uninterrupted supply of Hexvix[®]/Cysview[®] while maintaining
business in this new uncharted business and healthcare environment. Bladder
cancer treatments are a prioritized procedure for the healthcare systems, but we
must expect short-term postponements as resources are reallocated to prepare for
the exponentially growing number of COVID-19 patients in the coming weeks and
months,” says Daniel Schneider, President & Chief Executive Officer of
Photocure.
Photocure has adapted a framework for disclosure of COVID-19 related
information*, suggesting several topics for a risk and effect assessment,
including the following:
· COVID-19 impact on financial condition and results of operations.
Photocure comment: Bladder cancer treatments are prioritized procedures for the
healthcare systems, but Photocure expects restricted access to hospitals. Short
-term postponements of procedures and cystoscope installations will be
temporarily slowed. Hospitals are reallocating health care providers and
resources to handle the increase of COVID-19 patients. The long-term outlook
remains strong, but the visibility, especially in the U.S. remains limited for
the coming weeks and months.
· COVID-19 impact on capital and financial resources, including overall
liquidity position and outlook.
Photocure comment: The company had a cash position of NOK 123 million at the end
of March 2020 and carries no interest-bearing debt. Cost saving exercises are
being implemented to reduce cash burn through the restricted access period. In
addition, the company is pursuing various governmental subsidies and programs to
further help bridge this short-term period. Postponements of procedures will
affect the short-term kit shipments, impacting the working capital, but
Photocure has a solid financial position.
· COVID-19 impact on balance sheet and the ability to timely account for those
assets.
Photocure comment: The company expects the COVID-19 situation to have short-term
impact on the balance sheet, but an extended and profound virus situation in the
U.S. with a major and lasting impact on the business environment, may challenge
booked values.
· COVID-19 impact on impairments, increases in allowances for credit losses,
restructuring charges, other expenses, or changes in accounting judgments that
have had or are reasonably likely to have a material impact on the financial
statements.
Photocure comment: The company expects the COVID-19 situation to have impact on
the short-term financial statements, but an extended and profound virus
situation in the U.S., with a major and lasting impact on the business
environment, may affect the financial statements.
· COVID-19 impact on circumstances such as remote work arrangements adversely
affecting the ability to maintain operations, including financial reporting
systems, internal control over financial reporting and disclosure controls and
procedures.
Photocure comment: The company has implemented remote work arrangements across
its locations and is fully operational. All functions are designed to
accommodate remote work and no disruptions are expected. The main priority of
the organization is the health and welfare of all Photocure employees and
stakeholders. Business and travel policies which supported work from home and
social distancing were implemented prior to governmental orders. Where access to
hospitals and clinics is restricted because of the situation, Photocure’s sales
force maintains contact as needed through remote channels in order to guarantee
optimal service and support.
· COVID-19 impact on implementing business continuity plans.
Photocure comment: In light of the seriousness of the current COVID-19 global
health care crisis, the evolving circumstances require a different way of
working between Photocure and the health care providers. In a changing
environment, the company will continue to adapt to any new way of working to
provide our partners with uninterrupted service in treating patients with
bladder cancer. The company intends to keep the lines of communications open and
plans to offer a variety of means to keep Blue Light Cystoscopy with Cysview in
the forefront of patient care.
· COVID-19 impact on the demand for products or services.
Photocure comment: Bladder cancer treatments are prioritized procedures for the
healthcare systems, but the company expects short-term postponements, especially
in the low and medium risk patient category, as resources are reallocated to
prepare for the exponentially growing number of COVID-19 patients. In addition,
the opening of new accounts and placement of new scopes will be affected in the
short-term. The long-term outlook remains strong, but the visibility, especially
in the U.S. will stay low for the coming weeks and months.
· COVID-19 impact on supply chain.
Photocure comment: The company has increased the inventory of
Hexvix[®]/Cysview[®] to accommodate the estimated procedures through the first
quarter of 2021 and production remains at full capacity and on schedule. The
international distribution lines are uninterrupted and the inventory levels of
kits at partners and hospitals remain satisfactory.
· COVID-19 impact on human capital resources and productivity.
Photocure comment: The company has a highly specialized workforce committed to
improving patients’ lives. The majority of their work requires interaction with
healthcare providers. In the short-term, many institutions are restricting
access to protect patients, providers and suppliers from contracting COVID-19.
Photocure supports any employees willing to volunteer their medical expertise to
the communities in which they reside.
The U.S. sales team is supporting customers remotely and dedicating
administrative time to develop business plans to accelerate recovery after the
quarantine measures are lifted. Training sessions and virtual educational events
with leading urologists are also being organized and executed.
· COVID-19 impact on ability to operate and achieve business goals following
travel restrictions and border closures.
Photocure comment: Border closures do not affect the company´s national and
regional sales force. However, in many cases, hospital restrictions prohibit
supplier sales representatives from entry into the buildings. The long-term
outlook remains strong, but short-term business development initiatives will be
limited in the coming weeks following the travel restrictions and social
distancing measures.
“Photocure has a cash position of NOK 123 million at the end of March 2020 and
carries no interest-bearing debt. We have a strong underlying sales momentum in
the U.S when returning to a normalized business environment, providing a solid
platform for long-term growth. Short term business development and operations
will be affected by this unprecedented crisis in various ways, but we remain
confident in the significant commercial opportunities in the U.S. and reiterate
our long-term ambitions”, Schneider concludes.
*Division of Corporation Finance Securities and Exchange Commission CF
Disclosure Guidance: Topic No. 9. Date: March 25, 2020.
All trademarks mentioned in this release are protected by law and are registered
trademarks of Photocure ASA
This press release may contain product details and information which are not
valid, or a product is not accessible, in your country. Please be aware that
Photocure does not take any responsibility for accessing such information which
may not comply with any legal process, regulation, registration or usage in the
country of your origin.
For further information, please contact:
Dan Schneider
President and CEO
Photocure ASA
Tel: + 1-609 759-6515
Email: ds@photocure.com
Erik Dahl
Chief Financial Officer
Tel: +47 450 55 000
Email: ed@photocure.no
About Photocure ASA
Photocure: The Bladder Cancer Company delivers transformative solutions to
improve the lives of bladder cancer patients. Our unique technology, making
cancer cells glow bright pink, has led to better health outcomes for patients
worldwide. Photocure is headquartered in Oslo, Norway and listed on the Oslo
Stock Exchange (OSE: PHO). For more information, please visit us at
www.photocure.com, www.hexvix.com, www.cysview.com
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