MONTREAL, QUEBEC--(Marketwired - Aug 11, 2016) - Knight Therapeutics Inc. (TSX:GUD) ("Knight" or the "Company"), a leading Canadian specialty pharmaceutical company, today reported financial results for its second quarter ended June 30, 2016.

All figures are in thousands of Canadian dollars except for share and per share amounts.

Key Events in Second Quarter 2016

  • Announced and completed a bought deal at $8.00 per common share for gross proceeds of $230,000 including over-allotment exercise.

  • Received a Notice of Deficiency from Health Canada for ATryn®.

  • Entered into a distribution agreement with EMPA Healthcare LLC to commercialize Neuragen® in the United Arab Emirates and Kuwait.

Key Events Subsequent to the Quarter Ended June 30, 2016

  • Acquired 11,470,920 common shares of Pediapharm Inc. in exchange for 221,126 common shares and 221,126 four-year warrants of Knight with an exercise price of $10.00.

  • Entered into a distribution agreement with S.I.F.I - Società Industria Farmaceutica Italiana S.p.A. to commercialize NETILDEX™ in Canada.

  • Entered into a licencing and distribution agreement with 3D Signatures Inc. ("3D Signatures") and Plicit Capital Corp. ("Plicit"). Knight also committed to a minimum equity investment of $1,000 pursuant to a business combination and public listing transaction between 3D Signatures and Plicit.

  • Expanded distribution agreement with Ember Therapeutics Inc. ("Ember") to include the territories of Romania and the Caribbean and acquired the rights to two newly-acquired Ember products: Migralex™ and RHY/Vavelta®.

Financial Results Reported in Thousands of Canadian Dollars

For the quarter ended June 30, 2016, the Company reported revenues of $1,135 and net income of $4,446. As at June 30, 2016, the Company had $638,423 in cash, cash equivalents and marketable securities, total shareholders' equity of $861,965 and 132,480,708 common shares outstanding.

"This past quarter marked our 4th successful equity-raise in 28 months all at increasing valuations," said Jonathan Ross Goodman, President and CEO of Knight Therapeutics Inc. "We hope to demonstrate that we are as GUD at commercializing innovative pharmaceuticals that touch people's lives as we are at raising money. To this end, we have deployed or committed over $300 million since our founding in low risk, fair return opportunities that will improve the health of Canadians and help build Knight into Canada's leading specialty pharma company."

Conference Call Notice

Knight will host a conference call to discuss its second quarter results today at 8:30 am ET. Investors and other interested parties may call 1-877-223-4471 (Operator Assisted Toll-Free) or 647-788-4922 (local or international).

A taped replay of the conference call will be available from today at 11:30 am ET until Sunday, September 11, 2016 at 11:59 pm ET. To access the replay, please call 1-800-585-8367 or 416-621-4642 and use access code 10254484.

Notice of Third Quarter 2016 Results

Knight expects to release its third quarter 2016 financial results on the morning of Thursday, November 10, 2016. Knight expects to hold a conference call at 8:30 am ET on the morning of the release. All interested parties are cordially invited to attend. Investors and other interested parties may call 1-877-223-4471 (Operator Assisted Toll-Free) or 647-788-4922 (local or international).

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 www.gud-knight.com or www.sedar.com.

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, 2015. 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.

INTERIM CONSOLIDATED BALANCE SHEETS

[Unaudited] [In thousands of Canadian dollars]

As atJune 30, 2016 December 31, 2015
ASSETS
Current
Cash and cash equivalents363,713 237,481
Marketable securities274,710 233,726
Trade and other receivables4,505 2,994
Inventories833 1,460
Other current financial assets36,763 23,588
Income taxes receivable146 231
Total current assets680,670 499,480
Property and equipment - 18
Intangible assets5,956 3,320
Other financial assets95,076 62,616
Investment in associate81,393 81,027
Deferred income tax assets4,904 2,527
Total assets867,999 648,988
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities1,289 2,416
Income taxes payable4,745 4,031
Deferred other income - 293
Total current liabilities6,0346,740
Deferred income tax liabilities - 186
Total liabilities6,034 6,926
Shareholders' equity
Share capital662,702 439,148
Warrants161 161
Contributed surplus7,712 6,772
Accumulated other comprehensive income26,441 35,955
Retained earnings164,949 160,026
Total shareholders' equity861,965 642,062
Total liabilities and shareholders' equity867,999 648,988

INTERIM CONSOLIDATED STATEMENTS OF INCOME

[Unaudited] [In thousands of Canadian dollars, except for share and per share amounts]

Three-months ended
June 30		 Six-months ended
June 30
2016 20152016 2015
Revenues1,135 3332,203 580
Cost of goods sold535 272781 358
Gross margin600 611,422 222
Expenses
Selling and marketing154 -168 -
General and administrative2,055 2,4464,234 5,123
Research and development524 301807 635
(2,133) (2,686 )(3,787) (5,536 )
Depreciation of property and equipment10 718 15
Amortization of intangible assets122 21163 42
Interest income(6,124) (3,596 )(10,940) (7,562 )
Other income(354) (525 )(1,453) (966 )
Net gain on financial assets(783) (6,495 )(2,512) (14,024 )
Purchase gain on business combination--- (550 )
Gain on settlement of loan receivable- (358 )- (358 )
Share of net income of associate(805)-(1,659) -
Foreign exchange loss (gain)357 5924,127 (3,818 )
Income before income taxes5,444 7,6688,469 21,685
Income tax expense (recovery)578 (1,053 )3,119 (1,053 )
Deferred income tax expense420 201427 402
Net income for the period4,446 8,5204,923 22,336
Attributable to shareholders of the Company
Basic earnings per share0.04 0.090.05 0.24
Diluted earnings per share0.04 0.090.05 0.24
Weighted average number of common shares outstanding
Basic112,681,825 93,089,609108,078,434 92,816,245
Diluted113,112,999 93,222,325108,410,280 93,028,011

INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

[Unaudited] [In thousands of Canadian dollars]

Three-months ended
June 30		 Six-months ended
June 30
2016 20152016 2015
Net income for the period4,446 8,5204,923 22,336
Realized gain reclassified to statement of income net of tax of $1 and $65 for the three and six-month period ended June 30, 2016 (net of tax of $810 and $1,300 for the three and six-month period ended June 30, 2015)(6) (5,206 )(416) (8,050 )
Other comprehensive income (loss) to be reclassified to income or loss in subsequent periods:
Unrealized gain on available-for-sale financial instruments net of tax of $75 and $147 for the three and six-month period ended June 30, 2016 (net of tax of $72 and $404 for the three and six-month period ended June 30, 2015)2,127 8982,548 3,000
Unrealized (loss) gain on translating financial statements of foreign operations(668) (2,065 )(11,646) 10,852
Other comprehensive income (loss) for the period1,453 (6,373 )(9,514) 5,802
Total comprehensive income (loss) for the period5,899 2,147(4,591) 28,138

INTERIM CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

[Unaudited] [In thousands of Canadian dollars]

NotesShare
capital		WarrantsContributed
surplus		Accumulated
other
comprehensive
income		Retained
earnings		Total
shareholders'
equity
Balance as at January 1, 2015341,065-2,1009,967125,859478,991
Net income for the period - - - - 22,33622,336
Realized gain reclassified to statement of income, net of tax of $1,300 - - - (8,050 ) -(8,050)
Change in fair value of available-for-sale financial instruments, net of deferred tax of $404 - - - 3,000 -3,000
Change in unrealized gain on translating financial statements of foreign operations - - - 10,852 -10,852
Comprehensive income - 5,802 22,33628,138
Share-based compensation expense - - 2,865 - -2,865
Issuance of shares upon financing, net of costs and deferred tax of $2,200 14,573 - - - -14,573
Issuance of shares upon exercise of stock options 1,487 - (553 ) - -934
Issuance of warrants - 161 - - -161
Exercise of compensation warrants 930 - (295 ) - -635
Issuance of shares under share purchase plan 42 - - - -42
Balance as at June 30, 2015358,0971614,11715,769148,195526,339
Balance as at January 1, 2016439,1481616,77235,955160,026642,062
Net income for the period - - - - 4,9234,923
Realized gain reclassified to statement of income, net of tax for $65 - - - (416 ) -(416)
Change in fair value of available-for-sale financial instruments, net of deferred tax of $147 2,5482,548
Change in unrealized loss on translating financial statements of foreign operations - - - (11,646 ) -(11,646)
Comprehensive income (loss) - - (9,514 ) 4,923(4,591)
Share-based compensation expense - - 1,883 - -1,883
Issuance of shares upon bought deal, net of costs and deferred tax of $3,080 221,631 - - - -221,631
Issuance of shares to associate 2,073 - (943 ) - -1,130
Share purchase loans (200 ) - - - -(200)
Issuance of shares under share purchase plan 50 - - -50
Balance as at June 30, 2016662,7021617,71226,441164,949861,965

INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS

[Unaudited] [In thousands of Canadian dollars]

Six-month period ended June 30
2016 2015
OPERATING ACTIVITIES
Net income for the period4,923 22,336
Adjustments reconciling net income to operating cash flows:
Deferred tax427 403
Share-based compensation expense1,883 2,865
Depreciation and amortization181 57
Accretion of interest(2,846) (2,220 )
Realized gain on sale of other financial assets(142) (13,799 )
Unrealized gain on financial assets(2,370) (225 )
Gain on settlement of loan receivable - (358 )
Foreign exchange loss (gain)4,127 (4,146 )
Purchase gain on business combination - (550 )
Share of net income from associate(1,659) -
Changes in non-cash working capital related to operations963 (5,376 )
Deferred other income(293) (709 )
Cash inflow (outflow) from operating activities5,194 (1,722 )
INVESTING ACTIVITIES
Purchase of marketable securities(283,125) (383,578 )
Purchase of financial assets(5,423) (2,356 )
Purchase of intangibles(2,924) -
Investment in funds(9,225) (8,295 )
Issuance of loans receivable(37,449) (31,347 )
Proceeds from repayments of loans receivable2,023 10,028
Proceeds from disposal of financial assets4,026 29,242
Proceeds from sale of marketable securities234,104 420,691
Dividend income from associate2,423 -
Consideration paid on business combination - (1,750 )
Cash (outflow) inflow from investing activities(95,570) 32,635
FINANCING ACTIVITIES
Issuance of shares upon bought deal218,552 -
Proceeds from exercise of compensation warrants - 635
Proceeds from exercise of an over-allotment option - 12,424
Share option plan - 934
Share purchase plan50 42
Share purchase loans(200) -
Cost related to prior period share issuance - (207 )
Cash inflow from financing activities218,402 13,828
Increase in cash during the period128,026 44,741
Cash and cash equivalents, beginning of the period237,481 283,445
Net foreign exchange difference(1,794) 861
Cash and cash equivalents, end of the period363,713 329,047
Supplemental cash flow information:
Interest received6,821 4,991
Income taxes paid2,334 2,068