UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO SECTION
13a-16
OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of August,
Commission File Number:
001-36815
(Exact Name of Registrant as Specified in Its Charter)
Tuborg Boulevard 12
DK-2900
Hellerup Denmark
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of
Form 20-F
or Form 40-F.
Form 20-F ☒ Form
40-F ☐
Indicate by check mark if the registrant is submitting the
Form 6-K
in paper as permitted by Regulation S-T
Rule 101(b)(1): ☐ Indicate by check mark if the registrant is submitting the
Form 6-K
in paper as permitted by Regulation S-T
Rule 101(b)(7): ☐ INCORPORATION BY REFERENCE
This report on
Form 6-K
shall be deemed to be incorporated by reference into the registration statements on Form S-8
(Registration Numbers 333-228576,
333-203040,
333-210810,
333-211512,
333-213412,
333-214843,
333-216883,
333-254101,
and 333-261550)
and Form F-3
(Registration Numbers 333-209336,
333-211511,
333-216882,
333-223134,
333-225284,
and 333-256571)
of Ascendis Pharma A/S (the “Company”) (including any prospectuses forming a part of such registration statements) and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished. Information Contained in this Form
6-K
Report Financial Statements
This report contains the Company’s Unaudited Condensed Consolidated Interim Financial Statements as of June 30, 2022, including Management’s Discussion and Analysis of Financial Condition and Results of Operations for the period presented therein.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Ascendis Pharma A/S | ||||||
Date: August 10, 2022 |
By: |
/s/ Michael Wolff Jensen | ||||
Michael Wolff Jensen | ||||||
Senior Vice President, Chief Legal Officer | ||||||
ASCENDIS PHARMA A/S
INDEX TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Page |
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F-2 |
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F-3 |
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F-4 |
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F-5 |
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F-6 |
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F-1
Unaudited Condensed Consolidated Interim Statements of Profit or Loss
and Comprehensive Income / (Loss) for Three and Six Months Ended June 30
Three Months Ended June 30 |
Six Months Ended June 30 |
|||||||||||||||||||
Notes |
2022 |
2021 |
2022 |
2021 |
||||||||||||||||
(EUR’000) |
(EUR’000) |
|||||||||||||||||||
Statement of Profit or Loss |
||||||||||||||||||||
Revenue |
5 |
|||||||||||||||||||
Cost of sales |
||||||||||||||||||||
Gross profit / (loss) |
||||||||||||||||||||
Research and development costs |
||||||||||||||||||||
Selling, general and administrative expenses |
||||||||||||||||||||
Operating profit / (loss) |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||
Share of profit / (loss) of associate |
( |
) | ( |
) | ( |
) | ||||||||||||||
Finance income |
||||||||||||||||||||
Finance expenses |
||||||||||||||||||||
Profit / (loss) before tax |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||
Tax on profit / (loss) for the period |
( |
) | ||||||||||||||||||
Net profit / (loss) for the period |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||
Attributable to owners of the Company |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
Basic and diluted earnings / (loss) per share |
€( |
) | €( |
) | €( |
) | €( |
) | ||||||||||||
Number of shares used for calculation (basic and diluted) (1) |
||||||||||||||||||||
(EUR’000) |
(EUR’000) |
|||||||||||||||||||
Statement of Comprehensive Income |
||||||||||||||||||||
Net profit / (loss) for the period |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||
Other comprehensive income / (loss) |
||||||||||||||||||||
Items that may be reclassified subsequently to profit or loss: |
||||||||||||||||||||
Exchange differences on translating foreign operations |
( |
) | ( |
) | ||||||||||||||||
Other comprehensive income / (loss) for the period, net of tax |
( |
) |
( |
) |
||||||||||||||||
Total comprehensive income / (loss) for the period, net of tax |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||
Attributable to owners of the Company |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
(1) |
As of June 30, 2022, a total of warrants outstanding, each carrying the right to subscribe for one ordinary share, and convertible senior notes which can potentially be converted into ordinary shares, can potentially dilute earnings per share in the future but have not been included in the calculation of diluted earnings per share because they are antidilutive for the periods presented. Similarly, a total of warrants outstanding as of June 30, 2021, are also considered antidilutive for the periods presented and have not been included in the calculation. The weighted average number of shares takes into account the weighted average effect of changes in treasury shares during the period. |
F-2
Unaudited Condensed Consolidated Interim Statements of Financial Position
Notes |
June 30, 2022 |
December 31, 2021 |
||||||||||
(EUR’000) |
||||||||||||
| Assets |
||||||||||||
| Non-current assets |
||||||||||||
| Intangible assets |
||||||||||||
| Property, plant and equipment |
||||||||||||
| Investment in associate |
||||||||||||
| Other receivables |
10 |
|||||||||||
| Marketable securities |
10 |
|||||||||||
| |
|
|
|
|||||||||
| |
|
|
|
|||||||||
| Current assets |
||||||||||||
| Inventories |
||||||||||||
| Trade receivables |
10 |
|||||||||||
| Income tax receivables |
||||||||||||
| Other receivables |
10 |
|||||||||||
| Prepayments |
||||||||||||
| Marketable securities |
10 |
|||||||||||
| Cash and cash equivalents |
10 |
|||||||||||
| |
|
|
|
|||||||||
| |
|
|
|
|||||||||
| Total assets |
||||||||||||
| |
|
|
|
|||||||||
| Equity and liabilities |
||||||||||||
| Equity |
||||||||||||
| Share capital |
8 |
|||||||||||
| Distributable equity |
||||||||||||
| |
|
|
|
|||||||||
| |
|
|
|
|||||||||
| Non-current liabilities |
||||||||||||
| Borrowings |
10 |
|||||||||||
| Derivative liabilities |
10 |
|||||||||||
| Contract liabilities |
||||||||||||
| |
|
|
|
|||||||||
| |
|
|
|
|||||||||
| Current liabilities |
||||||||||||
| Borrowings |
10 |
|||||||||||
| Contract liabilities |
||||||||||||
| Trade payables and accrued expenses |
10 |
|||||||||||
| Other liabilities |
||||||||||||
| Income taxes payable |
||||||||||||
| Provisions |
||||||||||||
| |
|
|
|
|||||||||
| |
|
|
|
|||||||||
| Total liabilities |
||||||||||||
| |
|
|
|
|||||||||
| Total equity and liabilities |
||||||||||||
| |
|
|
|
|||||||||
F-3
Unaudited Condensed Consolidated Interim Statements of Changes in Equity
Distributable Equity |
||||||||||||||||||||||||||||
Share Capital |
Share Premium |
Treasury Shares |
Foreign Currency Translation Reserve |
Share-based Payment Reserve |
Accumulated Deficit |
Total |
||||||||||||||||||||||
(EUR’000) |
||||||||||||||||||||||||||||
| Equity at January 1, 2022 |
( |
) |
( |
) |
||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net profit / (loss) for the period |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||
| Other comprehensive income / (loss), net of tax |
— |
— |
— |
( |
) |
— |
— |
( |
) | |||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total comprehensive income / (loss) |
— |
— |
— |
( |
) |
— |
( |
) |
( |
) | ||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Transactions with Owners |
||||||||||||||||||||||||||||
| Share-based payment (Note 7) |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
| Acquisition of treasury shares (Note 9) |
— |
— |
( |
) |
— |
— |
— |
( |
) | |||||||||||||||||||
| Capital increase |
— |
— |
— |
— |
||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Equity at June 30, 2022 |
( |
) |
( |
) |
||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Distributable Equity |
||||||||||||||||||||||||||||
Share Capital |
Share Premium |
Treasury Shares |
Foreign Currency Translation Reserve |
Share-based Payment Reserve |
Accumulated Deficit |
Total |
||||||||||||||||||||||
(EUR’000) |
||||||||||||||||||||||||||||
| Equity at January 1, 2021 |
( |
) |
( |
) |
||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net profit / (loss) for the period |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||
| Other comprehensive income / (loss), net of tax |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total comprehensive income / (loss) |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Transactions with Owners |
— |
|||||||||||||||||||||||||||
| Share-based payment (Note 7) |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
| Capital increase |
— |
— |
— |
— |
||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Equity at June 30, 2021 |
( |
) |
||||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
F-
4
Unaudited Condensed Consolidated Interim Cash Flow Statements for the
Six Months Ended June 30
Six Months Ended June 30, |
||||||||
2022 |
2021 |
|||||||
(EUR’000) |
||||||||
| Operating activities |
||||||||
| Net profit / (loss) for the period |
( |
) |
( |
) | ||||
| Reversal of finance income |
( |
) |
( |
) | ||||
| Reversal of finance expenses |
||||||||
| Reversal of gain and loss on disposal of property, plant and equipment |
||||||||
| Reversal of tax charge |
( |
) | ||||||
| Increase / (decrease) in provisions |
||||||||
| Adjustments for non-cash items: |
||||||||
| Non-cash consideration relating to revenue |
( |
) |
( |
) | ||||
| Share of profit / (loss) of associate |
( |
) | ||||||
| Share-based payment |
||||||||
| Depreciation |
||||||||
| Amortization |
||||||||
| Changes in working capital: |
||||||||
| Inventories |
( |
) |
||||||
| Receivables |
( |
) |
( |
) | ||||
| Prepayments |
( |
) |
( |
) | ||||
| Contract liabilities (deferred income) |
( |
) |
( |
) | ||||
| Trade payables, accrued expenses and other payables |
||||||||
| |
|
|
|
|||||
| Cash flows generated from / (used in) operations |
( |
) |
( |
) | ||||
| Finance income received |
||||||||
| Finance expenses paid |
( |
) |
( |
) | ||||
| Income taxes received / (paid) |
( |
) |
( |
) | ||||
| |
|
|
|
|||||
| Cash flows from / (used in) operating activities |
( |
) |
( |
) | ||||
| |
|
|
|
|||||
| Investing activities |
||||||||
| Investment in associate |
( |
) | ||||||
| Acquisition of property, plant and equipment |
( |
) |
( |
) | ||||
| Reimbursement from acquisition of property, plant and equipment |
||||||||
| Development expenditures (software) |
( |
) | ||||||
| Purchase of marketable securities |
( |
) |
( |
) | ||||
| Settlement of marketable securities |
||||||||
| |
|
|
|
|||||
| Cash flows from / (used in) investing activities |
( |
) | ||||||
| |
|
|
|
|||||
| Financing activities |
||||||||
| Payment of principal portion of lease liabilities |
( |
) |
( |
) | ||||
| Net proceeds from convertible senior notes |
||||||||
| Proceeds from exercise of warrants |
||||||||
| Acquisition of treasury shares, net of transaction costs |
( |
) |
||||||
| |
|
|
|
|||||
| Cash flows from / (used in) financing activities |
||||||||
| |
|
|
|
|||||
| Increase / (decrease) in cash and cash equivalents |
( |
) | ||||||
| |
|
|
|
|||||
| Cash and cash equivalents at January 1 |
||||||||
| Effect of exchange rate changes on balances held in foreign currencies |
||||||||
| |
|
|
|
|||||
| Cash and cash equivalents at June 30 |
||||||||
| |
|
|
|
|||||
| Cash and cash equivalents include: |
||||||||
| Bank deposits |
||||||||
| Short-term marketable securities |
||||||||
| |
|
|
|
|||||
| Cash and cash equivalents at June 30 |
||||||||
| |
|
|
|
|||||
F-
5
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
Note 1—General Information
Ascendis Pharma A/S, together with its subsidiaries, is applying its innovative TransCon technologies to build a leading, fully integrated, global biopharmaceutical company. Ascendis Pharma A/S was incorporated in 2006 and is headquartered in Hellerup, Denmark. Unless the context otherwise requires, references to the “Company,” “we,” “us,” and “our”, refer to Ascendis Pharma A/S and its subsidiaries.
The address of the Company’s registered office is Tuborg Boulevard 12,
DK-2900,
Hellerup, Denmark. On February 2, 2015, the Company completed an initial public offering which resulted in the listing of American Depositary Shares (“ADSs”), representing the Company’s ordinary shares, under the symbol “ASND” in the United States on The Nasdaq Global Select Market.
The Company’s Board of Directors approved these unaudited condensed consolidated interim financial statements on August 10, 2022.
Note 2—Summary of Significant Accounting Policies
Basis of Preparation
The unaudited condensed consolidated interim financial statements of the Company are prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting.” Certain information and disclosures normally included in the annual consolidated financial statements prepared in accordance with International Financial Reporting Standards (“IFRS”) have been condensed or omitted. Accordingly, these unaudited condensed consolidated interim financial statements should be read in conjunction with the Company’s audited annual consolidated financial statements for the year ended December 31, 2021, and accompanying notes, which have been prepared in accordance with IFRS as issued by the International Accounting Standards Board (the “IASB”) and as adopted by the European Union (the “EU”).
The accounting policies applied are consistent with those of the previous financial year. A description of
the
accounting policies is provided in the Accounting Policies section of the audited consolidated financial statements as of and for the year ended December 31, 2021. In addition, the accounting policy for convertible senior notes and derivative liabilities, applied for the first time in this reporting period, is described below. The preparation of financial statements in conformity with IFRS requires the use of certain significant accounting estimates and requires management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the unaudited condensed consolidated interim financial statements are disclosed in Note 3, “Significant Accounting Judgements and Estimates”.
Convertible Senior Notes and Derivative Liabilities
Convertible senior notes (“convertible notes”) are separated into a financial liability and an embedded derivative component based on the terms and conditions of the contract. The embedded derivative component is accounted for separately if this is not deemed closely related to the financial liability.
The convertible notes include an embedded equity conversion option which is not deemed closely related to the financial liability, and is therefore initially recognized and measured separately at fair value as a derivative liability based on the stated terms upon issuance of the convertible notes. The conversion option is classified as a foreign currency conversion option which is not convertible into a fixed number of shares for a fixed amount of cash. Accordingly, the conversion option is recognized and measured as a derivative liability at fair value through profit or loss, with any subsequent remeasurement gains or losses recognized as part of financial income or expenses.
In addition, the convertible notes include a redemption option, which entitle the Company to redeem the notes at a cash amount equal to the principal amount of the convertible notes, plus accrued and unpaid interest. The redemption option is closely related to the financial liability, and therefore is not separately accounted for. The initial carrying amount of the financial liability component including the redemption option is the residual amount of the proceeds, net of allocated transaction costs, after separating the derivative component.
Transaction costs are apportioned between the financial liability and derivative component based on the allocation of proceeds when the instrument is initially recognized. Transaction costs apportioned to the financial liability component form part of the effective interest and are amortized over the expected lifetime of the liability. Transaction costs allocated to the derivative component are expensed as incurred.
The financial liability is subsequently measured at amortized cost until it is extinguished on conversion, optional redemption or upon repayment at maturity. The financial liability is presented as part of borrowings on the statement of financial position.
F-
6
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
New International Financial Reporting Standards Not Yet Effective
The IASB has issued a number of new or amended standards, which have not yet become effective or have not yet been adopted by the EU. Therefore, these new standards have not been incorporated in these unaudited condensed consolidated interim financial statements.
Amendments to IAS 1, “Classification of Liabilities as Current or
Non-current”
In January 2020, the IASB issued amendments to paragraphs 69 to 76 of IAS 1, “Presentation of Financial Statements”, to specify the requirements for classifying liabilities as current or
non-current.
The amendments clarify: | • | What is meant by a right to defer settlement; |
| • | That a right to defer must exist at the end of the reporting period; |
| • | That classification is unaffected by the likelihood that an entity will exercise its deferral right; and |
| • | That only if an embedded derivative in a convertible liability is itself an equity instrument would the terms of a liability not impact its classification. |
If approved by the EU, the amendments are effective for annual reporting periods beginning on or after January 1, 202399.0 million and €102.0 million, respectively.
3
, and must be applied retrospectively. The amendments are expected to require the convertible notes (presented as part of borrowings on the statement of financial position) and derivative liabilities, both
presented as non-current
liabilities at June 30, 2022, to be presented as current liabilities. On June 30, 2022, the carrying amount of convertible notes and derivative liabilities were €The consolidated financial statements are not expected to be affected by other new or amended standards.
Note 3—Significant Accounting Judgements and Estimates
In the application of the Company’s accounting policies, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. Judgements, estimates and assumptions applied are based on historical experience and other factors that are relevant, and which are available at the reporting date. Uncertainty concerning estimates and assumptions could result in outcomes, that require a material adjustment to assets and liabilities in future periods.
The unaudited condensed consolidated interim financial statements do not include all disclosures for significant accounting judgements, estimates and assumptions, that are required in the annual consolidated financial statements, and therefore, should be read in conjunction with the Company’s audited consolidated financial statements as of and for the year ended December 31, 2021.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized prospectively. While the application of critical accounting estimates is subject to material estimation uncertainties, management’s ongoing revisions of critical accounting estimates and underlying assumptions have not revealed any material impact in any of the periods presented in the unaudited condensed consolidated interim financial statements.
Other than as set out below, there have been no other changes to the application of significant accounting judgements, or estimation uncertainties regarding accounting estimates compared to December 31, 2021.
Valuation of Embedded Derivatives
The foreign currency conversion option, embedded in the convertible notes, is accounted for separately as a derivative liability at fair value through profit or loss.
Fair value cannot be measured based on quoted prices in active markets or other observable inputs, and accordingly, derivative liabilities are measured by using the Black-Scholes option pricing model. Subjective judgements and assumptions, which are subject to estimation uncertainties, need to be exercised in determining the appropriate unobservable input to the valuation model (Level 3 in the fair value hierarchy). These inputs include volatility of the Company’s share price for a historic period, reflecting the assumption that the historical volatility is indicative of a period similar to the expected lifetime of the option.
Changes in assumptions relating to these factors could affect the reported fair value of derivative liabilities.
F-
7
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
Note 4—Significant Events in the Reporting Period
COVID-19
Pandemic The
COVID-19
pandemic has affected countries where we are operating, where we have planned or have ongoing clinical trials, and where we rely on third-parties to manufacture preclinical, clinical and commercial supply. COVID-19
did not have a direct material impact on the unaudited condensed consolidated interim financial statements. Conflict in the Region Surrounding Ukraine and Russia
The ongoing conflict in the region surrounding Ukraine and Russia has impacted our ability to continue clinical trial activities in those countries. The conflict did not have a direct material impact on the unaudited condensed consolidated interim financial statements.
Leases
In February 2022, the Company entered into a facility lease in Germany with an enforceable lease term of 15 years , which is expected to commence in 2025. Subject to changes in terms and conditions and development in interest rates, an initial lease liability and corresponding asset of €55.2 million is expected to be recognized at the commencement date.
right-of-use
Convertible Senior Notes Offering
In March 2022, the Company issued an aggregate principal amount of $575.0 million of fixed rate 2.25 % convertible notes. The net proceeds from the offering were $557.9 million (€503.3 million), after deducting the initial purchasers’ discounts and commissions and offering expenses.
Further details are disclosed in Note 10, “Financial Assets and Financial Liabilities”.
Acquisition of Treasury Shares
The Company used $116.7 million (€105.3 million) of the net proceeds from the offering of the convertible notes to repurchase 1,000,000 ADSs representing the Company’s ordinary shares. Total holding of treasury shares is disclosed in Note 9, “Treasury Shares”.
F-
8
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
Note 5—Revenue
Revenue from commercial sale of products relates to sale of SKYTROFA30 days from the transaction date. SKYTROFA (lonapegsomatropin-tcgd) was approved by the U.S. Food and Drug Administration in August 2021, and the Company began shipping products to commercial customers in the fourth quarter of 2021.
®
(lonapegsomatropin-tcgd) on the U.S. market, which is sold to specialty pharmacies and specialty distributors (“commercial customers”). Customer payment terms are typically Other revenue is generated primarily from three license agreements, which were entered into in 2018. The licenses grant VISEN Pharmaceuticals exclusive rights to develop and commercialize TransCon hGH, TransCon PTH and TransCon CNP in Greater China.
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
(EUR’000) |
(EUR’000) |
|||||||||||||||
| Revenue from external customers |
||||||||||||||||
| Commercial sale of products |
||||||||||||||||
| Rendering of services |
||||||||||||||||
| Sale of clinical supply |
||||||||||||||||
| Licenses |
||||||||||||||||
| |
|
|
|
|
|
|
|
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| Total revenue from external customers |
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| |
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|
|
|
|||||||||
| Attributable to |
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| Commercial customers |
||||||||||||||||
| Collaboration partners and license agreements (1) |
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| |
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|
|||||||||
| Total revenue from external customers |
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| |
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|
|
|
|
|
|||||||||
| Specified by timing of recognition |
||||||||||||||||
| Recognized over time |
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| Recognized at a point in time |
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| |
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|
|||||||||
| Total revenue from external customers |
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| |
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|
|||||||||
| Revenue by geographical location |
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| Europe |
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| North America |
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| China |
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| |
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| Total revenue from external customers |
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| |
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|
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(1) |
For the three months ended June 30, 2022 and 2021, and for the six month ended June 30, 2022 and 2021, “Total revenue” includes recognition of previously deferred revenue/internal profit from associate of € million and € million, and of € million and € million respectively. |
F-
9
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
Note 6—Segment Information
The Company is managed and operated as one business unit. No separate business areas or separate business units have been identified in relation to product candidates or geographical markets. Accordingly, no additional information on business segments or geographical areas is disclosed.
Note 7—Share-based Payment
As an incentive to the Executive Board, employees, members of the Board of Directors and select consultants, Ascendis Pharma A/S has established warrant programs and, since December 2021, a Restricted Stock Unit program (“RSU program”), which are equity-settled share-based payment transactions.
Share-based Compensation Costs
Share-based compensation costs are determined using the grant date fair value of warrants and Restricted Stock Units (“RSUs”) granted and are recognized over the vesting period as research and development costs, selling, general and administrative expenses, or cost of sales. For the three and six months ended June 30, 2022 and 2021, share-based compensation costs recognized in the unaudited condensed consolidated interim statement of profit or loss were €16.8 million and €16.3 million, respectively, and €36.8 million and €39.4 million, respectively.
Restricted Stock Unit Program
RSUs are granted by the Board of Directors in accordance with authorizations given to it by the shareholders of Ascendis Pharma A/S to the Executive Board, select employees and members of the Board of Directors
(“RSU-holders”)
in accordance with the Company’s RSU program adopted in December 2021. In addition, RSUs may be granted to select consultants. One RSU represents a right for the RSU-holder
to receive one ADS of Ascendis Pharma A/S upon vesting if the vesting conditions are met, or waived by the Board of Directors at its discretion. All RSUs are hedged by treasury shares that have been repurchased in the market. Upon vesting, the Company may at its sole discretion choose to make a cash settlement instead of delivering ADSs.
RSU Activity
The following table specifies the number of RSUs granted, and outstanding RSUs at June 30, 2022:
Total RSUs |
||||
| Outstanding at January 1, 2022 |
||||
| |
|
|||
| Granted during the period |
||||
| Settled during the period |
||||
| Transferred during the period |
||||
| Forfeited during the period |
( |
) | ||
| |
|
|||
| Outstanding at June 30, 2022 |
||||
| |
|
|||
| Specified by vesting date |
||||
| December, 2022 |
||||
| December, 2023 |
||||
| December, 2024 |
||||
| |
|
|||
| Outstanding at June 30, 2022 |
||||
| |
|
|||
The fair value of RSUs at the date of grant was €123.46 for the year ended December 31, 2021, which was the first date of granting RSUs.
Warrant program
Warrants are granted by the Board of Directors in accordance with authorizations given to it by the shareholders of Ascendis Pharma A/S to all employees, members of the Board of Directors and select consultants (“warrantholders”). Each warrant carries the right to subscribe for one ordinary share of a nominal value of DKK 1 . The exercise price is fixed at the fair market value of the Company’s ordinary shares at the time of grant as determined by the Board of Directors. Vested warrants may be exercised in two or four annual exercise periods.
F-
10
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
Warrant Activity
The following table specifies the warrant activity during the six months ended June 30, 2022:
Total Warrants |
Weighted Average Exercise Price EUR |
|||||||
| Outstanding at January 1, 2022 |
||||||||
| |
|
|
|
|||||
| Granted during the period |
||||||||
| Exercised during the period |
( |
) |
||||||
| Forfeited during the period |
( |
) |
||||||
| |
|
|
|
|||||
| Outstanding at June 30, 2022 |
||||||||
| |
|
|
|
|||||
| Vested at June 30, 2022 |
||||||||
| |
|
|
|
|||||
The exercise prices of outstanding warrants under the Company’s warrant programs range from €6.48 to €145.5 depending on the grant dates.
Note 8—Share Capital
The share capital of Ascendis Pharma A/S consists of 56,965,058 fully paid shares at a nominal value of DKK 1 , all in the same share class.
Note 9—Treasury Shares
The holding of treasury shares is specified below:
Nominal values |
Holding |
Holding in % of total outstanding shares |
||||||||||
(EUR’000) |
(Number) |
|||||||||||
| Treasury shares |
||||||||||||
| At January 1, 2022 |
% | |||||||||||
| Acquired from third-parties |
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| |
|
|
|
|
|
|||||||
| At June 30, 2022 |
% | |||||||||||
| |
|
|
|
|
|
|||||||
F-
11
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
Note 10—Financial Assets and Financial Liabilities
Financial assets and liabilities comprise the following:
June 30, 2022 |
December 31, 2021 |
|||||||
(EUR’000) |
||||||||
| Financial assets by category |
||||||||
| Trade receivables |
||||||||
| Other receivables (excluding VAT receivables) |
||||||||
| Marketable securities |
||||||||
| Cash and cash equivalents |
||||||||
| |
|
|
|
|||||
| Financial assets measured at amortized cost |
||||||||
| |
|
|
|
|||||
| Total financial assets |
||||||||
| |
|
|
|
|||||
| Classified in the statement of financial position |
||||||||
| Non-current assets |
||||||||
| Current assets |
||||||||
| |
|
|
|
|||||
| Total financial assets |
||||||||
| |
|
|
|
|||||
June 30, 2022 |
December 31, 2021 |
|||||||
(EUR’000) |
||||||||
| Financial liabilities by category |
||||||||
| Borrowings |
||||||||
| Convertible senior notes |
||||||||
| Lease liabilities |
||||||||
| Trade payables and accrued expenses |
||||||||
| |
|
|
|
|||||
| Financial liabilities measured at amortized cost |
||||||||
| |
|
|
|
|||||
| Derivative liabilities |
||||||||
| |
|
|
|
|||||
| Financial liabilities measured at fair value through profit or loss |
||||||||
| |
|
|
|
|||||
| Total financial liabilities |
||||||||
| |
|
|
|
|||||
| Classified in the statement of financial position |
||||||||
| Non-current liabilities |
||||||||
| Current liabilities |
||||||||
| |
|
|
|
|||||
| Total financial liabilities |
||||||||
| |
|
|
|
|||||
F-12
Notes to the Unaudited Condensed Consolidated Interim Financial Statements
Marketable Securities
Marketable securities are measured at amortized cost, and fair values are determined based on quoted market prices. (Level 1 in the fair value hierarchy).
The composition of the portfolio is specified in the following table:
June 30, 2022 |
December 31, 2021 |
|||||||||||||||
Carrying amount |
Fair value |
Carrying amount |
Fair value |
|||||||||||||
(EUR’000) |
||||||||||||||||
| Marketable securities |
||||||||||||||||
| U.S. Government bonds |
||||||||||||||||
| Commercial papers |
||||||||||||||||
| Corporate bonds |
||||||||||||||||
| Agency bonds |
||||||||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Total marketable securities |
||||||||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Classified based on maturity profiles |
||||||||||||||||
| Non-current assets |
||||||||||||||||
| Current assets |
||||||||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Total marketable securities |
||||||||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Specified by rate structure |
||||||||||||||||
| Fixed rate |
||||||||||||||||
| Floating rate |
||||||||||||||||
| Zero-coupon |
||||||||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Total marketable securities |
||||||||||||||||