MIRA INFORM REPORT

 

 

Report Date :

02.07.2014   

 

IDENTIFICATION DETAILS

 

Name :

ALCOBRA LTD.

 

 

Registered Office :

2 Weizman Street, Amot Investment Building Tel Aviv  6423902

 

 

Country :

Israel

 

 

Financials (as on) :

31.03.2014

 

 

Date of Incorporation :

07.02.2008

 

 

Legal Form :

Private Limited Company

 

 

Line of Business :

Subject is a Biopharmaceutical company, focused on the development and commercialization an oral drug (MDX), to treat ADHD and other cognitive dysfunctions including Fragile X Syndrome

 

 

No. of Employees

09

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Status :

Moderate

Payment Behaviour :

Slow but correct

Litigation :

Clear

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – March 31, 2014

 

Country Name

Previous Rating

(31.12.2013)

Current Rating

(31.03.2014)

Israel

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low Risk

 

A2

Moderate Low Risk

 

B1

Moderate Risk

 

B2

Moderate High Risk

 

C1

High Risk

 

C2

Very High Risk

 

D

 

 


 

ISRAEL ECONOMIC OVERVIEW

 

Israel has a technologically advanced market economy. Cut diamonds, high-technology equipment, and pharmaceuticals are among the leading exports. Its major imports include crude oil, grains, raw materials, and military equipment. Israel usually posts sizable trade deficits, which are covered by tourism and other service exports, as well as significant foreign investment inflows. Between 2004 and 2011, growth averaged nearly 5% per year, led by exports. The global financial crisis of 2008-09 spurred a brief recession in Israel, but the country entered the crisis with solid fundamentals, following years of prudent fiscal policy and a resilient banking sector. In 2010, Israel formally acceded to the OECD. Israel's economy also has weathered the Arab Spring because strong trade ties outside the Middle East have insulated the economy from spillover effects. The economy has recovered better than most advanced, comparably sized economies, but slowing demand domestically and internationally, and a strong shekel, have reduced forecasts for the next decade to the 3% level. Natural gas fields discovered off Israel's coast since 2009 have brightened Israel's energy security outlook. The Tamar and Leviathan fields were some of the world's largest offshore natural gas finds this past decade. The massive Leviathan field is not due to come online until 2018, but production from Tamar provided a one percentage point boost to Israel's GDP in 2013 and is expected to contribute 0.5% growth in 2014. In mid-2011, public protests arose around income inequality and rising housing and commodity prices. Israel's income inequality and poverty rates are among the highest of OECD countries and there is a broad perception among the public that a small number of "tycoons" have a cartel-like grip over the major parts of the economy. The government formed committees to address some of the grievances but has maintained that it will not engage in deficit spending to satisfy populist demands. In May 2013 the Israeli government, in a politically difficult process, passed an austerity budget to reign in the deficit and restore confidence in the government's fiscal position. Over the long term, Israel faces structural issues, including low labor participation rates for its fastest growing social segments - the ultra-orthodox and Arab-Israeli communities. Also, Israel's progressive, globally competitive, knowledge-based technology sector employs only 9% of the workforce, with the rest employed in manufacturing and services - sectors which face downward wage pressures from global competition

 

Source : CIA


Company name and address

 

ALCOBRA LTD.

 

Telephone         972 72 220 46 61

Fax                   972 72 220 46 64

Email:               debbie@alcobra-pharma.com

 

2 Weizman Street, Amot Investment Building

Tel Aviv            6423902 Israel

 

 

HISTORY & LEGAL FORMATION

 

Originally established as a private limited company, incorporated as per file

No. 51-409899-5 on the 07.02.2008.

 

Following a successful IPO, in May 2013 subject converted to a public limited company (keeping same registration No.), and issued shares on the NASDAQ (NASDAQ:ADHD).

 

 

SHARE CAPITAL

 

Authorized share capital NIS 500,000.00 divided into -

50,000,000 ordinary shares of NIS 0.01 each,

of which  13,636,709shares amounting to NIS 136,367.09 were issued.

 

 

SHAREHOLDERS

 

1.         Dr. Dalia Megiddo, 21%,

2.         Udi Gilboa, 20%,

3.         HADASIT MEDICAL RESEARCH SERVICES & DEVELOPMENT LTD., 6%, a public limited company traded on the Tel Aviv Stock Exchange, controlled (37%) by the HADASSA MEDICINAL ORGANIZATION,

4.         KNOLL CAPITAL MANAGEMENT, 5%, of the USA,

5.         Austin W. Marxe, David M. Greenhouse and Adam C. Stettner (together), 5%,

6.         Shares are also traded on the NASDAQ Capital Market.

 

 

DIRECTORS

 

1.         Howard B. Rosen, Chairman,

2.         Dr. Yaron Daniely, President and General Manager,

3.         Ehud (Udi) Gilboa, CFO,

4.         Daniel E. Geffken,

5.         Dr. Hadas Gelander,

6.         Dr. Dalia Megiddo,

7.         Ori Mor,

8.         Dr. Aharon Schwartz.

 

 

BUSINESS

 

A Biopharmaceutical company, focused on the development and commercialization an oral drug (MDX), to treat ADHD and other cognitive dysfunctions including Fragile X Syndrome.

 

Subject is still in development stages,

 

Subject received 'Orphan Drug Designation' for the active ingredient in MDX for the treatment of Fragile X Syndrome in the United States (see more in CHARACTER).

 

Operating from rented premises in 2 Weizman Street, Amot Investment Building (9th floor), Tel Aviv (to where subject moved from 65 Rothschild Ave., Tel Aviv), and from a subsidiary in the USA.

 

Having 9 employees.

 

 

MEANS

 

Consolidated B/S:

                                          US$ (thousands)

                                         31.03.2014   31.12.2013

ASSETS

Current assets

Cash and cash equivalents        10,392  22,095

Short term deposits                   34,033  28,008

Other current assets                       991       115

                                                45,416  50,218

 

PP&E (net)                                    94        57

Other non-current assets                93        49

               187      106

                                                45,603     50,324

                                                =======   =======

 

LIABILITIES

Current liabilities            3,346                1,636

Equity                           42,257              48,688

                                    45,603              50,324

                                    =======          =======

 

 

Subject raised US$ 25 million in its May 2013 IPO.

 

In October 2013 subject raised US$ 33 million issuing shares on the NASDAQ.

 

Subject invested in R&D US$ 7,066,000 in 2013 US$ 818,000 in 2012 and

US$ 1,822,000 in 2011.

 

Current market value US$ 232.1 million.

 

There are no charges registered on the company's assets.

 

 

REVENUES

 

Consolidated Statement of Comprehensive Loss

US$ (thousands)

Year ended 31.12

2013     2012     2011

R&D expenses, net       7,066    818       1,822

General expenses          3,224    683       2,084

 

Net comprehensive loss            10,548  1,579    3,929

 

Net loss                        10,548  1,579    4,109

                                    ======            ======            =======

 

2014 first 3 months R&D expenses were US$ 5,522,000, making a net comprehensive loss of US$ 7,757,000 and a net loss of US$ 7,766,000.

 

 

OTHER COMPANIES

 

ALCOBRA, INC., 100% subject's US agent.

 

 

BANKERS

 

Bank data not forthcoming.

 

 

CHARACTER AND REPUTATION

 

Nothing unfavorable leaned.

 

As a/m subject is still in development stages.

 

Subject has initiated a 'Phase 3' clinical trial in the United States for the use of MDX to treat ADHD in adults.

 

The 'Orphan Drug Designation' provides a seven year term of market exclusivity upon final FDA approval, as well as positions a company to be able to

leverage a wide range of financial and regulatory benefits, including government grants for conducting clinical trials, waiver of expensive FDA

user fees for the potential submission of a New Drug Application,

 

Israel is considered one of the leading countries in the world in terms of investment in the Life Science and Biotechnology industry. In 2008 Israel was ranked 4th in investments in Biotechnology/GDP, while being among the leaders in the areas of investments and patents in Medical Device and Bio-Pharma fields.

During 2008 total of US$ 87 million were given to local Life Science firms by the Chief Scientist Office.

 

There are over 900 bio-med companies in Israel, as of 2013, according to the Israeli Advanced Technologies Industries (IATI), some 650 of which are medical devices and some 250 engaged in biotech. One third of the companies were established during the last 5 years. Out of the 900 companies, some 65 companies are publicly traded, the rest are private.

In 2012, around US$ 500 million were invested in bio-med companies, which is over 20% higher than in 2011.

 

 

SUMMARY

 

Notwithstanding being still in development stages, considering the successful 2 capital raises and B/S, considered good for trade engagements.

 

Note: Since February 2013 Israel Post has started using a new area code method of 7 digits (the old method of 5 digits is no longer valid).

 

 


 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.60.13

UK Pound

1

Rs.102.83

Euro

1

Rs.82.28

 

INFORMATION DETAILS

 

Analysis Done by :

SUM

 

 

Report Prepared by :

NIS

 

               

RATING EXPLANATIONS

 

RATING

STATUS

PROPOSED CREDIT LINE

 

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

 

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

 

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

 

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

 

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

 

Small

 

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

 

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

Credit not recommended

 

--

NB

New Business

--

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                  Payment record (10%)

Credit history (10%)                   Market trend (10%)                                Operational size (10%)

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.