Company Quick10K Filing
Quick10K
Foamix Pharmaceuticals
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$2.99 54 $163
10-Q 2019-03-31 Quarter: 2019-03-31
10-K 2018-12-31 Annual: 2018-12-31
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
20-F 2016-12-31 Annual: 2016-12-31
20-F 2015-12-31 Annual: 2015-12-31
8-K 2019-05-08 Earnings, Regulation FD, Exhibits
8-K 2019-04-11 Officers, Shareholder Vote, Exhibits
8-K 2019-01-24 Officers, Regulation FD, Exhibits
8-K 2019-01-24 Officers, Regulation FD, Exhibits
8-K 2019-01-03 Officers
8-K 2018-11-19 Officers, Exhibits
8-K 2018-11-07 Earnings, Regulation FD, Other Events, Exhibits
8-K 2018-10-01 Regulation FD, Exhibits
8-K 2018-09-18 Enter Agreement, Exhibits
8-K 2018-09-12 Regulation FD, Other Events, Exhibits
8-K 2018-06-27 Regulation FD, Exhibits
8-K 2018-05-14 Shareholder Vote
8-K 2018-05-09 Earnings, Exhibits
8-K 2018-05-07 Regulation FD, Exhibits
8-K 2018-04-16 Enter Agreement, Exhibits
8-K 2018-03-29 Other Events
8-K 2018-01-29 Other Events
8-K 2018-01-08 Regulation FD, Exhibits
8-K 2018-01-04 Other Events, Exhibits
8-K 2018-01-03 Officers, Other Events, Exhibits
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MSBF MSB Financial 90
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SSBP SSB Bancorp 0
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FOMX 2019-03-31
Part I - Financial Information
Item 1. Condensed Consolidated Financial Statements
Note 1 - Nature of Operations and Basis of Presentation:
Note 2 - Significant Accounting Policies:
Note 3 - Fair Value Presentation
Note 4 - Marketable Securities
Note 5 - Share Capital:
Note 6 - Commitments
Note 7 - Entity-Wide Disclosure:
Note 8 - Subsequent Events:
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-3.1 exhibit_3-1.htm
EX-10.1 exhibit_10-1.htm
EX-10.2 exhibit_10-2.htm
EX-10.3 exhibit_10-3.htm
EX-10.4 exhibit_10-4.htm
EX-10.5 exhibit_10-5.htm
EX-31.1 exhibit_31-1.htm
EX-31.2 exhibit_31-2.htm
EX-32.1 exhibit_32-1.htm
EX-32.2 exhibit_32-2.htm

Foamix Pharmaceuticals Earnings 2019-03-31

FOMX 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

10-Q 1 zk1922986.htm 10-Q


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2019

OR

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For transition period from __________ to __________

Commission file number: 001-36621

Foamix Pharmaceuticals Ltd.
(Exact name of registrant as specified in its charter)

Israel
Not Applicable
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)

2 Holzman Street, Weizmann Science Park
Rehovot, Israel
7670402
(Address of principal executive offices)
(Zip Code)
 
+972-8-9316233
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Ordinary Shares, par value NIS 0.16 per share
FOMX
Nasdaq Global Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes           No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted  pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes           No
 


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 
Large accelerated filer
 
Accelerated filer
 
Non-accelerated filer
 
Smaller reporting company
 
Emerging growth company
     

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes           No

The total number of shares outstanding of the registrant’s Ordinary Shares, par value NIS 0.16 per share, as of April 29, 2019, was 54,425,724.
 
2

 
TABLE OF CONTENTS

PART I
FINANCIAL INFORMATION
 
 
5
   
F - 2
   
F - 4
   
F - 5
    Statements of changes in shareholders' equity  F - 6
   
F - 7
   
F - 8
 
6
 
16
16
PART II
OTHER INFORMATION
 
 
16
16
 
17
17
17
17
 
18
 
3

 
DEFINITIONS

In this quarterly report on Form 10-Q, unless otherwise indicated, all references to the “company,” “we,” “us,” “our” and “Foamix” refer to Foamix Pharmaceuticals Ltd. and its subsidiary, Foamix Pharmaceuticals Inc., a Delaware corporation.

References to the “Companies Law” are to Israel’s Companies Law, 5759-1999, as currently amended;

References to the “Exchange Act” are to the Securities Exchange Act of 1934, as amended;

References to the “FDA” are to the U.S. Food and Drug Administration;

References to “Nasdaq” are to the Nasdaq Global Stock Market;

References to “Ordinary Shares” are to our ordinary shares, par value of NIS 0.16 per share;

References to the “SEC” are to the United States Securities and Exchange Commission;

References to the “Securities Act” are to the Securities Act of 1933, as amended; and

References to “U.S. dollars” and “$” are to currency of the United States of America, and references to “NIS” are to New Israeli Shekels.
 
4

 
PART I - FINANCIAL INFORMATION

ITEM 1. Condensed Consolidated Financial Statements
 
FOAMIX PHARMACEUTICALS LTD.

UNAUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
AS OF MARCH 31, 2019
 
5

 
FOAMIX PHARMACEUTICALS LTD.

UNAUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
 
AS OF MARCH 31, 2019
 
TABLE OF CONTENTS
 
 
Page
   
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
 
F-2 - F-3
F-4
F-5
F-6
F-7
F-8 - F-16
 
The amounts are stated in US dollars in thousands (except for share data)


 
FOAMIX PHARMACEUTICALS LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
 (U.S. dollars in thousands, except per share data)
(Unaudited)
 
    March 31     December 31  
    2019     2018  
A s s e t s
           
CURRENT ASSETS:
           
Cash and cash equivalents
 
$
18,994
   
$
27,868
 
Restricted cash
   
250
     
250
 
Short term bank deposits
   
24,155
     
24,047
 
Investment in marketable securities (Note 4)
   
39,122
     
46,669
 
Restricted investment in marketable securities (Note 4)
   
276
     
268
 
Accounts receivable:
               
Trade
   
1,168
     
1,066
 
Other
   
1,209
     
999
 
TOTAL  CURRENT ASSETS
   
85,174
     
101,167
 
                 
NON-CURRENT ASSETS:
               
Investment in marketable securities (Note 4)
   
-
     
150
 
Restricted investment in marketable securities (Note 4)
   
137
     
133
 
Property and equipment, net
   
2,297
     
2,235
 
Operating lease right of use assets (Note 6)
   
1,934
     
-
 
Other
   
17
     
46
 
TOTAL  NON-CURRENT ASSETS
   
4,385
     
2,564
 
                 
TOTAL  ASSETS
 
$
89,559
   
$
103,731
 
 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F - 2

FOAMIX PHARMACEUTICALS LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
 (U.S. dollars in thousands, except per share data)
(Unaudited)
 
    March 31     December 31  
    2019     2018  
Liabilities and shareholders’ equity
           
CURRENT LIABILITIES:
           
Accounts payable and accruals:
           
Trade
 
$
5,657
   
$
6,327
 
Operating lease liabilities (Note 6)
   
914
     
-
 
     Other
   
2,859
     
4,141
 
TOTAL  CURRENT LIABILITIES
   
9,430
     
10,468
 
                 
LONG-TERM LIABILITIES:
               
Liability for employee severance benefits
   
397
     
367
 
Operating lease liabilities (Note 6)
   
1,023
     
-
 
Other liabilities
   
714
     
714
 
TOTAL  LONG-TERM LIABILITIES
   
2,134
     
1,081
 
TOTAL  LIABILITIES
   
11,564
     
11,549
 
COMMITMENTS (Note 6)
               
SHAREHOLDERS' EQUITY:
               
Ordinary Shares, NIS 0.16 par value - authorized: 90,000,000 Ordinary Shares as of March 31, 2019 and December 31, 2018; issued and outstanding: 54,419,323 and 54,351,140 Ordinary Shares as of March 31, 2019 and December 31, 2018, respectively
   
2,334
     
2,331
 
Additional paid-in capital
   
306,266
     
305,303
 
Accumulated deficit
   
(230,613
)
   
(215,409
)
Accumulated other comprehensive income (loss)
   
8
     
(43
)
TOTAL  SHAREHOLDERS' EQUITY
   
77,995
     
92,182
 
TOTAL  LIABILITIES AND SHAREHOLDERS’ EQUITY
 
$
89,559
   
$
103,731
 
 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
 
F - 3

FOAMIX PHARMACEUTICALS LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (U.S. dollars in thousands, except per share data)
(Unaudited)
 
     
Three months ended
 
     
March 31
 
     
2019
     
2018
 
                 
REVENUES (Note 7)
 
$
308
   
$
906
 
                 
OPERATING EXPENSES:
               
Research and development
   
10,848
     
22,825
 
Selling, general and administrative
   
5,344
     
3,801
 
TOTAL OPERATING EXPENSES
   
16,192
     
26,626
 
OPERATING LOSS
   
15,884
     
25,720
 
FINANCE INCOME, net
   
(504
)
   
(73
)
LOSS BEFORE INCOME TAX
   
15,380
     
25,647
 
INCOME TAX
   
(176
)
   
330
 
NET LOSS FOR THE PERIOD
 
$
15,204
   
$
25,977
 
                 
LOSS PER SHARE BASIC AND DILUTED
 
$
0.28
   
$
0.69
 
                 
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING USED IN COMPUTATION
OF BASIC AND DILUTED LOSS PER SHARE IN THOUSANDS
   
54,370
     
37,541
 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F - 4

FOAMIX PHARMACEUTICALS LTD.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
 (U.S. dollars in thousands)
(Unaudited)
 
     
Three months ended
 
     
March 31
 
     
2019
     
2018
 
                 
NET LOSS
 
$
15,204
   
$
25,977
 
OTHER COMPREHENSIVE LOSS (INCOME):
               
Net unrealized losses (gains) from marketable securities
   
(36
)
   
15
 
Losses on marketable securities reclassified into net loss
   
-
     
(1
)
Net unrealized losses (gains) on derivative financial instruments
   
(15
)
   
14
 
Gains on derivative financial instruments reclassified into net loss
   
-
     
6
 
TOTAL OTHER COMPREHENSIVE LOSS (INCOME)
   
(51
)
   
34
 
TOTAL COMPREHENSIVE LOSS
 
$
15,153
   
$
26,011
 
 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F - 5

 
FOAMIX PHARMACEUTICALS LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(U.S. dollars in thousands, except share data)
(Unaudited)
 
   
Ordinary
shares
   
Additional paid-in capital
   
Accumulated deficit
   
Accumulated
other comprehensive Income (loss)
   
Total
 
   
Number of shares
   
Amounts
   
Amounts
 
BALANCE AT JANUARY 1, 2018
   
37,498,128
   
$
1,576
   
$
208,364
   
$
(141,281
)
 
$
(58
)
 
$
68,601
 
 Impact of initial adoption of new accounting standards, as previously reported
                           
35
     
(35
)
   
-
 
CHANGES DURING THE PERIOD:
                                               
Comprehensive loss
   
-
     
-
     
-
     
(25,977
)
   
(34
)
   
(26,011
)
Exercise of restricted share units
   
53,383
     
2
     
(2
)
   
-
     
-
     
-
 
Share-based compensation (Note 5)
   
-
     
-
     
1,754
     
-
     
-
     
1,754
 
BALANCE AT MARCH 31, 2018
   
37,551,511
     
1,578
     
210,116
     
(167,223
)
   
(127
)
   
44,344
 
                                                 
BALANCE AT JANUARY 1, 2019
   
54,351,140
   
$
2,331
   
$
305,303
   
$
(215,409
)
 
$
(43
)
 
$
92,182
 
CHANGES DURING THE PERIOD:
                                               
Comprehensive income (loss)
   
-
     
-
     
-
     
(15,204
)
   
51
     
(15,153
)
Exercise of options and restricted share units
   
68,183
     
3
     
13
     
-
     
-
     
16
 
Share-based compensation (Note 5)
   
-
     
-
     
950
     
-
     
-
     
950
 
BALANCE AT MARCH 31, 2019
   
54,419,323
   
$
2,334
   
$
306,266
   
$
(230,613
)
 
$
8
   
$
77,995
 
 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
 
F - 6

FOAMIX PHARMACEUTICALS LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
(Unaudited)
 
    Three months ended  
    March 31  
    2019     2018  
             
CASH FLOWS FROM OPERATING ACTIVITIES:
           
Net Loss
 
$
(15,204
)
 
$
(25,977
)
Adjustments required to reconcile net loss to net cash used in
operating activities:
               
Depreciation and amortization
   
76
     
86
 
Loss from disposal of fixed assets
   
-
     
36
 
Changes in marketable securities and bank deposits, net
   
(264
)
   
(40
)
Changes in accrued liability for employee severance benefits,
net of retirement fund profit
   
30
     
(35
)
Share-based compensation
   
950
     
1,754
 
Non-cash finance expenses (income), net
   
23
     
1
 
Changes in operating asset and liabilities:
               
Decrease (increase) in trade and other receivables
   
(300
)
   
487
 
Decrease in other non-current assets
   
(4
)
   
-
 
Increase (Decrease) in accounts payable and accruals
   
(1,949
)
   
495
 
Net cash used in operating activities
   
(16,642
)
   
(23,193
)
CASH FLOWS FROM INVESTING ACTIVITIES:
               
Purchase of fixed assets
   
(138
)
   
(122
)
Investment in bank deposits
   
(8,000
)
   
(8,500
)
Investment in marketable securities
   
-
     
(1,012
)
Proceeds from sale and maturity of marketable securities and
bank deposits
   
15,877
     
29,642
 
Net cash provided by investing activities
   
7,739
     
20,008
 
CASH FLOWS FROM FINANCING ACTIVITIES:
               
Proceeds from exercise of options
   
16
     
-
 
Net cash provided by financing activities
   
16
     
-
 
 DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH
   
(8,887
)
   
(3,185
)
EFFECT OF EXCHANGE RATE ON CASH, CASH EQUIVALENTS AND RESTRICTED CASH
   
13
     
(1
)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF THE PERIOD
   
28,118
     
16,206
 
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF THE PERIOD
 
$
19,244
   
$
13,020
 
Cash and cash equivalents
 
$
18,994
   
$
12,770
 
Restricted cash
   
250
     
250
 
                 
TOTAL CASH, CASH EQUIVALENTS AND RESTRICTED CASH SHOWN IN STATEMENT OF CASH FLOWS
 
$
19,244
   
$
13,020
 
SUPPLEMENTARY INFORMATION ON INVESTING AND FINANCING ACTIVITIES NOT INVOLVING CASH FLOWS -
               
Property and equipment purchases included in accounts payable and accruals
   
-
   
$
4
 
       Cashless exercise of RSU's
 
$
3
   
$
2
 
                 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
               
Interest received
 
$
307
   
$
384
 
Additions to operating lease right of use assets and liabilities
 
$
736
     
-
 
 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F - 7

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(U.S. dollars in thousands, except share and per share amounts)

NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION:

a.
Nature of operations

Foamix Pharmaceuticals Ltd. (hereinafter “Foamix”) is an Israeli company incorporated in 2003.
Foamix’s shares are publicly traded on the NASDAQ under the symbol “FOMX”, since its initial public offering (“IPO”) in September, 2014.

Foamix is a late clinical-stage specialty pharmaceutical company focused on developing and commercializing its proprietary topical drug candidates for dermatological therapy. Foamix lead product candidate, FMX101 (4% minocycline foam), is being developed for the treatment of moderate-to-severe acne. An additional product candidate, FMX103 (1.5% minocycline foam), is being developed for the treatment of moderate-to-severe papulopustular rosacea. Both product candidates are novel topical foam formulations of the antibiotic minocycline and were developed using Molecule Stabilizing Technology, a proprietary foam platform designed to optimize the topical delivery of minocycline, an active pharmaceutical ingredient, or API, that is currently available only in oral form despite its prevalent use in dermatology.

Foamix also licensed its technology under development and licensing agreements to various pharmaceutical companies for development of certain products combining Foamix's foam technology with the licensee’s proprietary drugs.

In May 2014, Foamix incorporated a wholly-owned Subsidiary in the United States of America - Foamix Pharmaceuticals Inc. (hereinafter the "Subsidiary"). The Subsidiary was incorporated to assist Foamix with regard to marketing, regulatory affairs and business development relating its products and technology.

Since incorporation through March 31, 2019, Foamix and its subsidiary (hereinafter “the Company”) incurred losses and negative cash flows from operations mainly attributable to its development efforts and has an accumulated deficit of $230,613. The Company has financed its operations mainly through the issuance of shares through private and public financing rounds, convertible loans and payments received under development and licensing agreements. The Company's cash and investments as of as of the issuance date of these financial statements, will allow the Company to fund its operating plan through at least the next 12 months. However, the Company expects to continue to incur significant research and development and other expenses related to its ongoing operations and in order to continue its future operations, the Company will need to obtain additional funding until becoming profitable. If the Company is unable to obtain such funding it will need to curtail or cease operations.

b.
Basis of presentation

The unaudited interim condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP") for interim financial statements. Accordingly, they do not contain all information and notes required by U.S. GAAP for annual financial statements. In the opinion of management, these unaudited condensed consolidated interim financial statements reflect all adjustments, which include normal recurring adjustments, necessary for a fair statement of the Company’s consolidated financial position as of March 31, 2019, the consolidated results of operations and comprehensive loss, changes in shareholders equity and cash flows for the three-month periods ended March 31, 2019 and 2018.

These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s annual financial statements for the year ended December 31, 2018. The condensedconsolidated balance sheet data as of December 31, 2018 was derived from the audited consolidated financial statements for the year ended December 31, 2018, included in Form 10K, but does not include all disclosures required by U.S. GAAP for annual financial statements.
 
The results for the three-month periods ended March 31, 2019 are not necessarily indicative of the results expected for the year ending December 31, 2019.
 
F - 8

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(U.S. dollars in thousands, except share and per share amounts)
 
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:

a.
Principles of consolidation
 
The consolidated financial statements include the accounts of Foamix and its subsidiary. Intercompany balances and transactions including profits from intercompany sales not yet realized outside the Company, have been eliminated upon consolidation.
 
b.
Fair value measurement
 
Fair value is based on the price that would be received from the sale of an asset or that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, the guidance establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described as follows:
 
Level 1:
Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.
 
Level 2 Observable prices that are based on inputs not quoted on active markets, but corroborated by market data or active market data of similar or identical assets or liabilities.
 
Level 3:
Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.
 
In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value.
 
c.
Loss per share

Net loss per share, basic and diluted, is computed on the basis of the net loss for the period divided by the weighted average number of Ordinary shares outstanding during the period. Diluted net loss per share is based upon the weighted average number of Ordinary shares and of Ordinary share equivalents outstanding when dilutive. Ordinary share equivalents include outstanding stock options and warrants which are included under the treasury share method when dilutive.
 
F - 9

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(U.S. dollars in thousands, except share and per share amounts)
 
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (continued):

The following share options, restricted share units (“RSUs”) and warrants were excluded from the calculation of diluted net loss per ordinary share because their effect would have been anti-dilutive for the periods presented (share data):

   
Three months ended
March 31
 
   
2019
   
2018
 
Outstanding share options and RSUs
   
5,895,973
     
4,728,610
 
Warrants
   
-
     
1,394,558
 

d.
Newly issued and recently adopted accounting pronouncements:

Accounting pronouncements adopted in period:

1)
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which supersedes the existing guidance for lease accounting, Leases (Topic 840). The new standard requires lessees to record assets and liabilities on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement.
 
The Company adopted the standard as of January 1, 2019 on a modified retrospective basis and did not restate comparative periods. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to carryforward the historical lease classification and not separate lease and non-lease components for the leases. The Company recognizes the lease payments in the consolidated statements of Operations on a straight-line basis over the lease period.
 
The adoption of the standard resulted in recognition of $1,357 of lease assets and lease liabilities as of January 1, 2019 on the Company’s consolidated balance sheets.
 
2)
In June 2018, the FASB issued ASU No. 2018-07, Compensation-Stock Compensation (Topic 718) Improvements to Nonemployee Share-based Payments. This ASU was issued to simplify the accounting for share-based transactions by expanding the scope of Topic 718 from only being applicable to share-based payments to employees to also include share-based payment transactions for acquiring goods and services from nonemployees. As a result, nonemployee share-based transactions will be measured by estimating the fair value of the equity instruments at the grant date, taking into consideration the probability of satisfying performance conditions. This standard, adopted as of January 1, 2019, had no material impact on the Company’s consolidated financial statements. 
F - 10

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(U.S. dollars in thousands, except share and per share amounts)
 
NOTE 3 - FAIR VALUE PRESENTATION
 
The Company’s assets and liabilities that are measured at fair value as of March 31, 2019 and December 31, 2018, are classified in the tables below in one of the three categories described in note 2b above:
 
   
March 31, 2019
 
   
Level 1
   
Level 2
   
Total
 
Marketable securities
 
$
1,001
   
$
38,534
   
$
39,535
 
Currency options designated as hedging instruments (current asset)
   
-
   
$
12
   
$
12
 
                         
   
December 31, 2018
 
   
Level 1
   
Level 2
   
Total
 
Marketable securities
 
$
991
   
$
46,229
   
$
47,220
 
Currency options designated as hedging instruments (current liability)
   
-
   
$
(3
)
 
$
(3
)
 
The Company’s debt securities are traded in markets that are not considered to be active, but are valued based on quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. Accordingly, these assets are categorized as Level 2.

Foreign exchange risk management

The Company purchases and writes non-functional currency options in order to hedge the currency exposure on the Company’s cash flow. The currency hedged items are denominated in New Israeli Shekels (NIS). The purchasing and writing of options is part of a comprehensive currency hedging strategy with respect to salary and rent expenses denominated in NIS. These transactions are at zero cost for periods of up to one year. The counterparties to the derivatives are major banks in Israel. As of March 31, 2019, the total hedged amount was NIS 6.5 million.

The derivative asset, in the amount of $12 as of March 31, 2019, qualifies as hedge accounting.

As of March 31, 2019, the Company has a lien in the amount of $276 on the Company’s marketable securities and a lien in the amount $250 on the Company’s checking account, in respect of bank guarantees granted in order to secure the hedging transactions.

NOTE 4 - MARKETABLE SECURITIES

Marketable securities as of March 31, 2019, and December 31, 2018 consist mainly of debt and mutual funds securities. The debt securities are classified as available-for-sale and are recorded at fair value. Changes in fair value, net of taxes (if applicable), are reflected in other comprehensive loss. Realized gains and losses on sales of the securities, as well as premium or discount amortization, are included in the consolidated statement of operations as finance income or expenses.

As of January 1, 2018, following the adoption of ASU No. 2016-01, Financial Instruments—Overall (Subtopic 825-10), equity securities with readily determinable fair value are measured at fair value. The changes in the fair value of equity investments are recognized through net income. Adoption of the standard was applied through a cumulative one-time adjustment of $35 to the accumulated deficit.

F - 11

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(U.S. dollars in thousands, except share and per share amounts)
 
NOTE 4 - MARKETABLE SECURITIES (continued):

The following table sets forth the Company’s marketable securities:
 
     
March 31
     
December 31
 
     
2019
     
2018
 
Israeli mutual funds
 
$
1,001
   
$
991
 
Certificates of deposit
   
2,086
     
2,773
 
U.S Government and agency bonds
   
20,694
     
25,215
 
U.S Treasury bills
   
15,754
     
18,241
 
Total
 
$
39,535
   
$
47,220
 

As of March 31, 2019 and December 31, 2018 the fair value, cost and gross unrealized holding gains and losses of the marketable securities owned by the Company were as follows:
 
    March 31, 2019  
   
Fair
value
   
Cost or
amortized cost
   
Gross unrealized
holding losses
   
Gross unrealized
holding gains
 
Certificates of deposit
 
$
2,086
   
$
2,092
   
$
6
   
$
-
 
U.S Government and agency bonds
   
20,694
     
20,693
     
3
     
4
 
U.S Treasury bills
   
15,754
     
15,753
     
-
     
1
 
Total
 
$
38,534
   
$
38,538
   
$
9
   
$
5
 

       
   
December 31, 2018
 
   
Fair
value
   
Cost or
amortized cost
   
Gross unrealized
holding loss
   
Gross unrealized
holding gains
 
Certificates of deposit
 
$
2,773
   
$
2,790
   
$
17
   
$
-
 
U.S Government and agency bonds
   
25,215
     
25,236
     
22
     
1
 
U.S Treasury bills
   
18,241
     
18,243
     
3
     
1
 
Total
 
$
46,229
   
$
46,269
   
$
42
   
$
2
 
    
As of March 31, 2019, the unrealized losses attributed to the Company’s marketable securities were primarily due to credit spreads and interest rate movements. The Company has considered factors regarding other than temporary impaired securities and determined that there are no securities with impairment that is other than temporary as of March 31, 2019 and December 31, 2018.
 
As of March 31, 2019, and December 31, 2018 the Company’s debt securities had the following maturity dates:
 
     
Market value
 
     
March 31
     
December 31,
 
     
2019
     
2018
 
Due within one year
 
$
38,534
   
$
46,079
 
1 to 2 years
   
-
     
150
 
Total
 
$
38,534
   
$
46,229
 

F - 12

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(U.S. dollars in thousands, except share and per share amounts)

NOTE 4 - MARKETABLE SECURITIES (continued):
 
During the three months ended March 31, 2019 and March 31, 2018 the Company received proceeds of $7,877 and $7,689 upon sale and maturity of marketable securities.
 
$413 and $401 of the Company’s marketable securities were restricted as of March 31, 2019, and December 31, 2018, respectively, due to a lien in respect of bank guarantees granted to secure hedging transaction and the Company’s rent agreements. Refer to note 6 and note 3.

NOTE 5 - SHARE CAPITAL:

Share-based compensation
 
In May 2015, the Company's board of directors approved a new option plan (the "Plan") replacing the previous plan approved in 2009. The Plan included a pool of 2,690,694 ordinary shares for grant to Company employees, consultants, directors and other service providers. During the years ended December 31, 2016 and December 31, 2017, the Board of Directors approved an accumulated increase of 2,900,000 ordinary shares to the plan. As of March 31, 2019, 27,990 shares remain available for grant under the Plan. On April 10, 2019 the Company’s shareholders approved a new equity incentive plan which included a pool of an additional 6,000,000 shares in addition to the shares remaining available for grant under the 2015 plan, See note 8.
 
In the three months ended March 31, 2019 and 2018, the Company granted options as follows:

   
Three months ended March 31, 2019
 
   
Award
amount
   
Exercise
price range
 
Vesting
period
 
Expiration
 
Employees:
                   
Options
   
897,736
   
$
3.56-$3.81
 
4 years
 
10 years
 
RSUs
   
274,628
     
-
 
4 years
   
-
 


   
Three month ended March 31, 2018
 
   
Award
amount
   
Exercise
price range
 
Vesting
period
 
Expiration
 
Employees:
                   
Options
   
488,843
   
$
6.35-$6.40
 
4 years
 
10 years
 
RSUs
   
103,448
     
-
 
4 years
   
-
 
 
The fair value of options and RSUs granted to employees during the three months ended March 31, 2019, and the three months ended March 31, 2018 was $2,736 and $2,305 respectively.

F - 13

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(U.S. dollars in thousands, except share and per share amounts)

NOTE 5 - SHARE CAPITAL (continued):
 
The fair value of RSUs granted to employees is based on the share price on grant date and was computed using the Black-Scholes model. The underlying data used for computing the fair value of the options are as follows:
 
   
Three months ended
March 31
 
   
2019
   
2018
 
Value of ordinary share
 
$
3.32-$3.83
   
$
5.99
 
Dividend yield
   
0
%
   
0
%
Expected volatility
   
61.2%-61.4
%
   
62.1
%
Risk-free interest rate
   
2.55%-2.62
%
   
2.75
%
Expected term
 
6 years
   
6 years
 
 
The following table illustrates the effect of share-based compensation on the statements of operations:
 
     
Three months ended
March 31
 
     
2019
     
2018
 
Research and development expenses
 
$
354
   
$
891
 
Selling, general and administrative
   
596
     
863
 
Total
 
$
950
   
$
1,754
 
 
NOTE 6 – COMMITMENTS
 
Operating lease agreements

The Company leases office space for its headquarters and research and development facilities in Israel and the United States under several lease agreements. The lease agreement for the facilities in Israel are linked to the Israeli CPI and due to expire in December 2020.

The lease agreement in the United States was due to expire during March 2019. On March 13, 2019, the Company signed an amendment to the original lease agreement. The amendment includes an extension of the lease period of the 10,000 square feet currently leased under the original agreement (the "Current Space") and an addition of 4,639 square feet (the "Additional Space”). The Company will enter the Additional Space following a period of preparation by the lessor which is expected to be competed no later than August 1, 2019 (the "Commencement Date").

On March 13, 2019, pursuant to the extension of the lease on the Current Space, the Company recognized an additional right of use asset and liability in the amount of $713. The Additional Space is considered a new lease agreement and will be recognized only on Commencement Date. As of March 31, 2019, the expected right of use asset and liability of the Additional Space to be recognized on the Commencement Date is $333.

In July 2017, the Company has entered into operating lease agreements in connection with a number of vehicles. The lease periods are generally for three years and the payments are linked to the Israeli CPI. To secure the terms of the lease agreements, the Company has made certain prepayments to the leasing company, representing approximately three months of lease payments. These amounts have been recorded as part of the operating lease right to use assets.

F - 14

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(U.S. dollars in thousands, except share and per share amounts)

NOTE 6 – COMMITMENTS (continued):
 
Operating lease costs for the three months ended March 31, 2019, are as follows:
 
     
Three months ended March 31
 
     
2019 
 
Office lease expenses
 
$
182
 
Vehicles lease expenses
 
$
25
 

Cash paid for amounts included in the measurement of lease liabilities are as follows:
 
     
Three months ended March 31
 
     
2019 
 
Office lease
 
$
201
 
Vehicles lease
 
$
36
 

Supplemental information related to leases are as follows:

   
March 31
 
   
2019
 
Operating lease right-of-use assets
 
$
1,934
 
Operating lease liabilities
 
$
1,937
 
Weighted average remaining lease term
 
2.4 years
 
Weighted average discount rate
   
5.54
%

Maturities of lease liabilities are as follows:
 
2019
 
$
695
 
2020
   
954
 
2021
   
279
 
2022
   
150
 
Total lease payments
 
$
2,078
 
Less imputed interest
 
$
(141
)
Total lease liability
 
$
1,937
 

The Company has a lien in the amount of $137 on the Company’s marketable securities in respect of bank guarantees granted in order to secure the lease agreements.

The Company elected the alternative modified transition method and included the following table previously disclosed.

Future minimum lease commitments under non-cancelable operating lease agreements as of December 31, 2018 were as follows:
 
2019
 
$
746
 
2020
   
682
 
2021 and thereafter
   
21
 
Total
 
$
1,449
 

F - 15

FOAMIX PHARMACEUTICALS LTD.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(U.S. dollars in thousands, except share and per share amounts)
 
NOTE 7 - ENTITY-WIDE DISCLOSURE:

a.
Net revenues by geographic area were as follows:
 
     
Three months ended
March 31
 
     
2019
     
2018
 
United States
 
$
-
   
$
62
 
Denmark
   
308
     
-
 
Germany
   
-
     
844
 
Total revenues
 
$
308
   
$
906
 

b.
Customers exceeding 10% of revenues:

In each of the three months ended March 31, 2019 and March 31, 2018 the Company had one customer exceeding over 10% of total revenues. Revenues from the customers were $308 and $844 during the three months ending March 31, 2019, and March 31, 2018, respectively.
 
c.
Net revenues by type of payment:
 
     
Three months ended
March 31
 
     
2019
     
2018
 
Development service payments
 
$
-
   
$
62
 
Royalties
   
308
     
844
 
Total revenues
 
$
308
   
$
906
 
 
NOTE 8 - SUBSEQUENT EVENTS:
 
On April 10, 2019, the Company’s shareholder approved the following: (i) a new employee incentive plan including an additional pool of 6,ooo,ooo shares for grant; (ii) an employee share purchase plan with a pool of 5,400,000 shares for purchase; and (iii) an increase to the Company’s authorized shares of 45,000,000 shares NIS 0.16 per share.

 
F - 16
 

 
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with (i) our condensed consolidated financial statements and the notes thereto included elsewhere in this quarterly report on Form 10-Q (ii) our audited consolidated financial statements and related notes and management’s discussion and analysis of financial condition and results of operations included in our annual report on Form 10-K for the year ended December 31, 2018 filed with the SEC on February 28, 2019. This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Exchange Act. These statements are often identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “will,” “would” or the negative or plural of these words or similar expressions or variations. Such forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified herein, and those referred in the section titled “Risk Factors”, set forth in Part II, Item 1A of this quarterly report on Form 10-Q, if any, and in our other SEC filings. Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to our management. These statements, like all statements in this report, speak only as of the date of this quarterly report on Form 10-Q (unless another date is indicated), and, except as required by law, we undertake no obligation to update or revise these statements in light of future developments.

Company Overview

We are a late clinical-stage specialty pharmaceutical company focused on developing and commercializing our proprietary, innovative and differentiated topical drug candidates for dermatological therapy. Our lead product candidate, FMX101 (4% minocycline foam), is being developed for the treatment of moderate-to-severe acne and our second product candidate, FMX103 (1.5% minocycline foam), is being developed for the treatment of moderate-to-severe papulopustular rosacea. Both product candidates are novel topical foam formulations of the antibiotic minocycline and were developed using our Molecule Stabilizing Technology, a proprietary foam platform designed to optimize the topical delivery of minocycline, an active pharmaceutical ingredient, or API, that is currently available only in oral form despite its prevalent use in dermatology.

We announced positive top-line results from both of our Phase III clinical trials for each of FMX101 and FMX103 in the second half of 2018. We submitted our new drug application, or NDA, to the FDA, for FMX101 in December 2018, and expect to submit an NDA for FMX103 in mid-2019. In March 2019, we announced that the FDA accepted our NDA for FMX101 for review, with a targeted Prescription Drug User Fee Act, or PDUFA, action date of October 20, 2019. We cannot provide any assurances or predict with any certainty the schedule for which we will, if at all, receive approval from the FDA with respect to FMX101 or FMX103. See “–Key Developments” below. Despite the considerable U.S. market opportunities for acne and rosacea, we believe these markets are currently underserved and commonly treated by oral prescription products such as minocycline and doxycycline and various non-minocycline topical therapies. If approved, we believe FMX101 and FMX103 have the potential to provide first-in-class topical treatments for millions of people who suffer from their respective indications.

Our corporate strategy is to develop and solidify a commercial presence in acne and rosacea by obtaining FDA approval for, and launching our lead product candidates, FMX101 and FMX103, in the United States. We may also enter into partnerships with third parties to reach other geographic territories or therapeutic fields through their respective sales forces and infrastructure. Following these near-term goals, we intend to grow beyond these indications into other dermatological indications, and to diversify our product and commercial development beyond minocycline and the tetracycline class of antibiotics. We are currently developing additional foam and other topical products for acne, rosacea and other dermatology indications in vehicle platforms designed to enhance delivery of their respective APIs. We are also evaluating diversifying into synergistic technologies and specialties either on our own or through partnerships.

6

 
FMX101 is a product candidate containing micronized minocycline hydrochloride, an antibiotic in the tetracycline class, in a 4% concentration for the treatment of moderate-to-severe acne vulgaris. The active pharmaceutical ingredient is suspended in our Molecule Stabilizing Technology foam vehicle, an elegant, light-feeling topical foam that is easily spread across wide areas of the skin. In September 2018, we announced our third Phase III clinical trial of FMX101 (Study FX2017-22) met both of its co-primary endpoints, demonstrating a statistically significant reduction in the number of inflammatory lesions and a statistically significant improvement in patients’ Investigator’s Global Assessment, or IGA, scores, a metric commonly used to measure efficacy in acne trials. These positive results followed the results from our initial two Phase III clinical trials of FMX101 that we announced in 2017, where both co-primary endpoints were met in one trial (Study FX2014-05) and one of the two co-primary endpoints showed statistical significance in the other trial (Study FX2014-04). We embarked on our third Phase III trial (Study FX2017-22) following a Type B meeting with the FDA in which the FDA confirmed that replicating the results of Study FX2014-05 would likely support an efficacy claim for FMX101. In addition to the positive Study FX2017-22 efficacy results, very few safety adverse events (and no treatment-related serious adverse events) were observed both in Study FX2017-22 and in the 40-week open label safety portion of Studies FX2014-04 and FX20410-05 that we concluded in January 2018.

FMX103 is a product candidate also containing micronized minocycline hydrochloride suspended in our Molecule Stabilizing Technology vehicle, at a lower 1.5% concentration, for the treatment of moderate-to-severe papulopustular rosacea. In November 2018, we announced that both of our Phase III clinical trials for FMX103 (Studies FX2016-11 and FX2016-12) met each of their co-primary endpoints, demonstrating a statistically significant reduction in inflammatory lesion counts and IGA treatment success of approximately 50% from baseline. There were no treatment-related serious adverse events, very few reported adverse events and positive user-experience reports overall in these Phase III clinical trials as well as in the 40-week open label safety extension (Study FX2016-13) that was recently completed in February 2019.

We developed FMX101 and FMX103 using our proprietary Molecule Stabilizing Technology foam-based technology platform that was optimized for delivery of minocycline hydrochloride, a characteristically unstable small molecule, through the skin. We are currently developing in-house a pipeline of other innovative products to enhance our minocycline platform, including FCD105, a product candidate for the treatment of acne vulgaris that combines minocycline with a retinoid and which we anticipate evaluating in a Phase II clinical trial (Study FX2016-40) beginning in mid-2019. We are also currently reviewing potential acquisitions of pipeline products at various stages of development that could be incorporated into our vehicle for optimized delivery.

In addition, we have other proprietary delivery technologies in development that enable topical delivery of other APIs, each having unique pharmacological features and characteristics designed to keep the API stable when delivered and directed to the target site. We are conducting research and are in the early stages of in-house development of FMX110, a topical gel formulation of doxycycline hyclate for the treatment of papulopustular rosacea, and FMX109, a non-tetracycline acne product candidate that contains a combination of nicotinamide and a retinoid for the treatment of moderate-to-severe acne vulgaris. We believe our foam and other topical delivery platforms may offer significant advantages over alternative delivery options and are suitable for multiple application sites across a range of conditions.

In addition to our in-house development projects, we have entered into development and license agreements relating to our technology with various pharmaceutical companies, most notably with LEO Pharma A/S, or LEO, who assumed a license agreement we initially entered into with Bayer HealthCare AG, or Bayer.  In 2015, Bayer received FDA approval for Finacea® Foam (15% azelaic acid), or Finacea, a prescription foam product for the treatment of rosacea, which utilizes an emulsion-based proprietary foam platform that we licensed to them that is different from our surfactant-free foam platform that supports our lead product candidates. Bayer began selling Finacea in the United States in the third quarter of 2015, and in September 2018, LEO acquired Finacea from Bayer and assumed all rights and responsibilities under our initial license agreement with Bayer. Together with LEO, we are litigating against several generic pharmaceutical companies for alleged infringement of certain of our patents following the generic companies’ submission of abbreviated new drug applications with the FDA, seeking approval to manufacture and sell generic versions of Finacea. We recently settled our litigation against Perrigo FINCO UK Limited Partnership, or Perrigo, but our litigation against two other companies, Teva Pharmaceuticals USA, Inc. and Taro Pharmaceutical Industries, Ltd. and its affiliates, remains ongoing.

7


We have also out-licensed other foam technology platforms to other third parties to develop branded pharmaceutical products containing different APIs for potential commercialization that are in the early stages of development.
 
We continue to be an “emerging growth company,” as defined in Section 2(a) of the Securities Act and as modified by the JOBS Act. As such, we are eligible to, and take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not “emerging growth companies,” such as not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002. We will remain an emerging growth company until the earliest of: (i) the last day of our fiscal year during which we have total annual gross revenues of at least $1.07 billion; (ii) the last day of our fiscal year following the fifth anniversary of the closing of our initial public offering, specifically, December 31, 2019; (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt; or (iv) the date on which we are deemed to be a “large accelerated filer” under the Exchange Act with at least $700 million of equity securities held by non-affiliates.

We are also currently a “smaller reporting company,” as defined in Rule 12b-2 of the Exchange Act.  In the event we are still a smaller reporting company when we cease being an emerging growth company, we will be able to continue to take advantage of certain reduced or scaled disclosure requirements, for as long as we continue to have smaller reporting company status.

Key Developments

Below is a summary of selected key developments affecting our business that have occurred since December 31, 2018:

·
On January 23, 2019, Ms. Sharon Barbari was appointed as a member of our board of directors. Dr. Dalia Megiddo resigned from our board of directors, effective April 10, 2019, the date of our annual general meeting.

·
On March 7, 2019, we announced that the FDA accepted for review our NDA for FMX101 and set October 20, 2019 as the targeted PDUFA action date. In April, the FDA conducted a pre-approval inspection of our U.S. offices in conjunction with its review of our NDA for FMX101 and made some minor inspectional observations that are being addressed, which we do not believe will adversely impact the FDA’s review of our NDA for FMX101. We are seeking approval of FMX101 for the treatment of inflammatory lesions of non-nodular moderate-to-severe acne vulgaris in patients nine years of age and older. Our NDA submission includes the previously-communicated results from our two Phase III trials, Studies FX2014-05 and FX2017-22, and also incorporates information on chemistry manufacturing and controls, and data from non-clinical toxicology studies on FMX101.

·
On April 2, 2019, we announced that, together with LEO Pharma, we have settled the Hatch-Waxman litigation with Perrigo, relating to Finacea® Foam.
 
·
Our partner, LEO, recently informed us that batches of Finacea produced by the contract manufacturer have failed to meet the required specifications for the finished product. As a result, LEO has not been able to deliver the same quantity of Finacea for sale, which has decreased the royalty payments from LEO to us for sales of Finacea.  In the three months ended March 31, 2019, our total revenue decreased by $598 thousand or 66% to $308 thousand compared to $906 thousand in the three months ended March 31, 2018. LEO has informed us that they are working diligently to address the issue in order to be able to produce sufficient supply of the finished product to meet the demand for Finacea in the market. This supply chain issue for Finacea is not related to the manufacturing, production or supply of any of our products, including FMX101 and FMX103.
8

 
Revenues
 
To date, we have not generated any revenues from sales of FMX101, FMX103 or any of our other product candidates. We will not commercially launch FMX101 or our other product candidates in the United States or generate any revenues from sales of any of our product candidates until after obtaining marketing approval, which we do not expect before the end of 2019. Our ability to generate revenues from sales will depend on the successful commercialization of FMX101, FMX103 and our other product candidates.

As of March 31, 2019, we generated cumulative revenues of approximately $32.0 million under development and license agreements, of which approximately $18.4 million were development service payments, approximately $3.1 million were contingent payments and $10.5 million were royalty payments. The royalties were paid in relation to Finacea, the prescription foam product that we developed in collaboration with Bayer. In the three months ended March 31, 2019, we received (or became entitled to receive) royalty payments in an amount of $0.3 million. We may become entitled to additional contingent payments, subject to achievement of the applicable clinical results by our other licensees. In light of the current phase of development under these agreements, we do not expect to receive significant payments in the near term, if at all.
 
Cost of Revenues

There was no cost of revenues for the three months ended March 31, 2019 and 2018, as revenues consist almost entirely of royalties, which do not bear related cost of revenue.

We do not expect substantial changes in cost of revenue unless and until we obtain regulatory approval for our lead product candidates and begin serial production of such products, whether internally or through third party manufacturers, at which point we expect our cost of revenues to grow along with the growth of our sales and inventory needs.

Operating Expenses

Research and development expenses

Research and development activities are, and will continue to be, central to our business. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. We expect to incur significant research and development costs in the foreseeable future assuming our pipeline products progress into clinical trials. However, we do not believe that it is possible at this time to accurately project total program-specific expenses to reach commercialization. There are numerous factors associated with the successful commercialization of any of our product candidates, including future trial design and various regulatory requirements, many of which cannot be determined with accuracy at this time based on our stage of development. Additionally, future commercial and regulatory factors beyond our control will affect our clinical development programs and plans.

Our research and development expenses relate primarily to the development of FMX101 and FMX103. From January 1, 2007 until March 31, 2019, we cumulatively spent approximately $180.2 million on research and development of FMX101, FMX103 and our other product candidates. Our total research and development expenses for the three-month periods ended March 31, 2019 and 2018 were approximately $10.8 and $22.8 million, respectively. We charge all research and development expenses to operations as they are incurred. We expect research and development expenses to lessen in the near term due to the completion of our Phase III clinical trials for FMX101 and FMX103.
 
9

 
The successful development of our product candidates is highly uncertain. While we have a filed an NDA for FMX101 and expect to file one for FMX103, we cannot provide any assurances or predict with any certainty the schedule on which we will, if at all, receive approval from the FDA with respect to either of FMX101 and FMX103. As such, at this time, we cannot reasonably estimate or know the nature, timing and costs of the efforts that will be necessary to complete the remainder of the development of our technology for additional indications. This uncertainty is due to numerous risks and variables associated with developing products, including the uncertainty of:
 
·
the scope, rate of progress and expense of our research and development activities;
 
·
preclinical results;
 
·
clinical trial results;
 
·
the terms and timing of regulatory approvals; and
 
·
our ability to file, prosecute, obtain, maintain, defend and enforce patents and other intellectual property rights and the expense of filing, prosecuting, obtaining, maintaining, defending and enforcing patents and other intellectual property rights;

A change in the outcome of any of these variables with respect to the development of our product candidates could result in a significant change in the costs and timing associated with their development. For example, if the FDA or foreign regulatory authority were to require us to conduct preclinical studies and clinical trials beyond those which we currently anticipate for the completion of clinical development of our product candidates, or if we experience significant delays in enrollment in any clinical trials, we could be required to expend significant additional time and financial resources on the completion of the clinical development.

Research and development expenses consist primarily of:
 
·
employee-related expenses, including salaries, benefits and related expenses, including share-based compensation expenses;
 
·
expenses incurred under agreements with third parties, including subcontractors, suppliers and consultants that conduct regulatory activities, clinical trials and preclinical studies;
 
·
expenses incurred to acquire, develop and manufacture clinical trial materials;
 
·
facilities, depreciation and other expenses, which include direct and allocated expenses for rent and maintenance of facilities, insurance, and other operating costs; and
 
·
other costs associated with preclinical and clinical activities and regulatory operations.

Selling, general and administrative expenses

Our selling, general and administrative expenses consist principally of:
 
·
employee-related expenses, including salaries, benefits and related expenses, including share-based compensation expenses;
 
·
costs associated with market research and business development activities in preparation for future marketing and sales, including activities intended to select the most promising product candidates for further development and commercialization;
 
·
legal and professional fees for auditors and other consulting expenses not related to research and development activities or to market research or business development activities;
 
·
cost of office space, communication and office expenses;
 
·
information technology expenses;
 
·
depreciation of tangible fixed assets related to our general and administrative activities or to our market research and business development activities; and
 
·
costs associated with filing, prosecuting, obtaining and maintaining patents and other intellectual property.

As part of our growth strategy, we have begun building up our dedicated U.S. marketing and business development team and infrastructure, and we intend to further increase such U.S. infrastructure, as well as expand our marketing effort to new markets. We therefore expect selling and marketing expenses to increase in absolute terms as a percentage of our revenues. Our total selling, general and administrative expenses for the three months ended March 31, 2019 and 2018 were approximately $5.3 and $3.8 million, respectively.

Our ability to commercialize FMX101 and FMX103 successfully, if approved, is highly uncertain and depends on a number of factors, including market adoption of our product candidates by physicians and patients, market access uncertainty, our ability to scale to the market opportunity and the existence of existing and future products that may compete with ours. As such, at this time, we cannot reasonably estimate or know the nature, timing and costs of the efforts that will be necessary for successful commercialization of our product candidates, if approved.

10

 
Financial Income

Financial income consists primarily of gains from interest earned from our bank deposits and financial income on our marketable securities.

Taxes on Income

We have yet to generate taxable income in Israel, as we have historically incurred operating losses resulting in carry forward tax losses totaling approximately $146.7 million as of December 31, 2018. During 2018, we incurred a carry forward tax loss in our U.S. subsidiary, Foamix Pharmaceuticals Inc., of $0.4 million. We anticipate that we will be able to carry forward these tax losses to future tax years. Accordingly, we do not expect to pay taxes in the applicable jurisdiction until we have taxable income after the full utilization of our carry-forward tax losses in that jurisdiction. We provided a full valuation allowance with respect to the deferred tax assets related to these carry-forward losses.
 
Comparison of the Three-Month Periods Ended March 31, 2019 and 2018

Revenues

          Our total revenues decreased by $0.6 million, or 66%, to $0.3 million in the three months ended March 31, 2019, from $0.9 in the three months ended March 31, 2018. The decrease is due to the failure of LEO’s contract manufacturer of Finacea to meet the required specifications for the finished product, which resulted in the inability of LEO to deliver the same quantity of Finacea for sale, which in turn decreased our royalty payments. LEO has informed us that they are working diligently to address the issue in order to be able to produce sufficient supply of the finished product to meet the demand for Finacea in the market. This supply chain issue for Finacea is not related to the manufacturing, production or supply of any of our products, including FMX101 and FMX103.

Cost of revenues

There was no cost of revenues for the three-month periods ended March 31, 2019 and 2018, as revenues consist almost entirely of royalties, which bear no related cost of revenue.

Research and development expenses
 
Our research and development expenses for the three months ended March 31, 2019 were $10.8 million, representing a decrease of $12.0 million, or 52.6%, compared to $22.8 million for the three months ended March 31, 2018. The decrease in research and development expenses resulted primarily from a decrease of $13.8 million in clinical trial expenses due to the completion of FMX101 and FMX103 clinical trials, offset by an increase of $0.6 million in payroll and payroll-related expenses due to an increase in headcount and salaries, and $0.6 million increase in consulting expenses.
 
Selling, general and administrative expenses

Our general and administrative expenses for the three months ended March 31, 2019 were $5.3 million, representing an increase of $1.5 million, or 39.4%, compared to $3.8 million for the three months ended March 31, 2018. The increase in selling, general and administrative expenses resulted primarily from an increase of $1.4 million in expenses mostly relating to pre-commercialization activities and market research.
 
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Operating loss

As a result of the foregoing, our operating loss for the three months ended March 31, 2019 was $15.9 million, compared to an operating loss of $25.7 million for the three months ended March 31, 2018, a decrease of $9.8 million, or 38.1%.

Finance income

In the three-month periods ended March 31, 2019 and 2018, our financial income included mostly gains from marketable securities and interest earned on our bank deposits.

The finance expenses (income) by cash and non-cash components are as follows:

   
Three months ended March 31,
 
   
2019
   
2018
 
   
(in thousands of U.S. dollars)
 
Interest on bank deposits
 
$
(179
)
 
$
(57
)
Gain from marketable securities, net
   
(357
)
   
(106
)
Total income
   
(536
)
   
(163
)
Less:
               
Other expenses
   
4
     
3
 
Foreign exchange loss, net
   
28
     
87
 
Total expenses
   
32
     
90
 
Finance income, net
 
$
(504
)
 
$
(73
)

Taxes on income

During the three-month periods ended March 31, 2019 and 2018, we incurred tax income of $176,000 and tax expenses of $330,000, respectively. The tax income recognized during the three months ended March 31, 2019 relates to the reversal a provision for uncertain tax positions.

Net Loss

Our net loss for the three months ended March 31, 2019 was $15.2 million, compared to $26.0 million for the three months ended March 31, 2018, a decrease of $10.8 million, or 42%.

Liquidity

Since our inception, we have incurred losses from operations and negative cash flows from our operations. For the three months ended March 31, 2019 we incurred a net loss of $15.2 million, which included $16.6 million used for operating activities. For the three months ended March 31, 2018 we incurred a net loss of $26.0 million, which included $23.2 million used for operating activities.

As of March 31, 2019, and March 31, 2018, we had a working capital surplus of $75.7 million and $38.4 million, respectively, and an accumulated deficit of $230.6 million and $167.2 million, respectively.

Our principal source of liquidity as of March 31, 2019 consisted of cash and investments of $82.9 million.

On April 13, 2018, we entered into a Securities Purchase Agreement with OrbiMed Partners Master Fund Limited, or OrbiMed, pursuant to which we agreed to issue and sell, in a registered offering under an effective shelf registration statement, an aggregate of 2,940,000 Ordinary Shares, at a purchase price equivalent to $5.50 per share, for aggregate net proceeds of approximately $16.1 million, after deducting offering expenses. The closing of the issuance and sale of these securities took place on April 16, 2018.

On September 18, 2018, we completed an additional follow-on offering under our effective shelf registration statement in which we sold 11,670,000 Ordinary Shares at a price of $6.00 per share, raising net proceeds, after expenses and underwriter commissions, of approximately $65.6 million. After the closing of the offering, the underwriters exercised an option to purchase 1,750,500 additional Ordinary Shares at the per share price of the offering. The proceeds from the exercise of the option, net of expenses and underwriter commissions, were approximately $9.8 million, bringing the total net proceeds from the offering to approximately $75.4 million.

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We anticipate that with our existing cash and investments we will be able to fund our planned operating expenses and capital expenditure requirements through mid-2020. These planned expenses include: (a) pre-commercialization and launch preparations for FMX101, assuming we receive regulatory approval, (b) full development and filing of an NDA for FMX103, which we expect to submit in mid-2019, and (c) certain pipeline development activities. We expect we will need additional funding to support our operating expenses and capital requirements for the second half of 2020 and beyond, including with regard to the commercialization of any of our product candidates if they are granted regulatory approval, and to fund our internal and external research and development efforts. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect.

Capital Resources

Overview

To date, we have financed our operations through private and public placements of our Ordinary Shares, convertible loans and through fees, cost reimbursements and royalties received from our licensees.

From inception through March 31, 2019 we have received net cash proceeds of approximately $280.1 million from the issuance of Ordinary Shares, preferred shares, exercise of options and warrants and from convertible loans.

Cash flows

The following table summarizes our statement of cash flows for the three-month periods ended March 31, 2019 and 2018:

   
Three months ended March 31,
 
   
2019
   
2018
 
   
(in thousands of U.S. dollars)
 
Net cash (used in) / provided by:
           
Operating activities
 
$
(16,642
)
 
$
(23,193
)
Investing activities
   
7,739
     
20,008
 
Financing activities
   
16
     
-
 

Net cash used in operating activities

The use of cash in all periods resulted primarily from our net losses adjusted for non-cash charges and measurements and changes in components of working capital. Adjustments to net income for non-cash items mainly include depreciation and amortization and share-based compensation.

Net cash used in operating activities was $16.6 million in the three months ended March 31, 2019, compared to $23.2 million in the three months ended March 31, 2018. The decrease was attributable primarily to the decrease in activity related to clinical trials.

Net cash provided by investing activities

Net cash provided by investing activities was $7.7 million in the three months ended March 31, 2019, compared to $20.0 million in the three months ended March 31, 2018. The decrease in investing activities was attributable primarily to a decrease in proceeds from the sale and maturity of marketable securities and bank deposits.

Net cash provided by financing activities

There was $16,000 provided by financing activities in the three months ended March 31, 2019, compared to none in the three months ended March 31, 2018. The increase was attributable to proceeds from exercise of options.

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Cash and funding sources

The table below summarizes our main sources of financing for the three-month periods ended March 31, 2019 and 2018:

   
Proceeds from our underwritten public offerings(1)
   
Proceeds from our direct public offerings
   
Proceeds from issuance of Ordinary Shares
   
Payments from licensees
   
Total
 
Three months ended March 31, 2019
   
-
      -      
16,000
     
206,000
     
222,000
 
Three months ended March 31, 2018
   
-
      -      
-
     
989,000
     
989,000
 
___________________________
(1) Net of issuance costs.

Our sources of financing in the three months ended March 31, 2019 totaled $222,000 and consisted mainly of payments from licensees.

Our sources of financing in the three months ended March 31, 2018 totaled $989,000 and consisted of payments from licensees.

We have no ongoing material financial commitments (such as lines of credit) that may affect our liquidity over the next five years.

Funding requirements

We anticipate that with our existing cash and investments we will be able to fund our planned operating expenses and capital expenditure requirements through mid-2020. These planned expenses include: (a) full development and filing of an NDA for FMX103, which we expect to submit in mid-2019, (b) certain pipeline development activities, and (c) any pre-commercialization and launch preparations for FMX101 in anticipation of possible regulatory approval. We expect we will need additional funding to support our operating expenses and capital requirements for 2020 and beyond, including with regard to the commercialization of our product candidates and to fund our internal and external research and development efforts. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect.

Our present and future funding requirements will depend on many factors, including, inter alia:
 
·
the progress, timing and completion of preclinical testing and clinical trials for pipeline product candidates;
 
·
selling, marketing and patent-related activities undertaken in connection with the anticipated commercialization of FMX101, FMX103 and any other product candidates, as well as costs involved in the development of an effective sales and marketing organization;
 
·
the time and costs involved in obtaining regulatory approval for FMX101, FMX103 and our other pipeline product candidates and any delays we may encounter as a result of evolving regulatory requirements or adverse results with respect to any of these products;
 
·
the number of potential new products we identify and decide to develop;
 
·
the costs involved in filing and prosecuting patent applications and obtaining, maintaining and enforcing patents or defending against claims or infringements raised by third parties, and license royalties or other amounts we may be required to pay to obtain rights to third party intellectual property rights; and
 
·
the amount of revenues, if any, we may derive either directly or in the form of royalty payments from future sales of FMX101, FMX103 and any other pipeline product that is commercialized.
 
14


 
Our operating plan may change as a result of many factors currently unknown to us, and any such change may affect our funding requirements. We have never before launched a product commercially, and the costs involved in such commercial launch may exceed our expectations. We may therefore need to seek additional capital sooner than planned, through public or private equity or debt financings or other sources, such as strategic collaborations or additional license arrangements. Such financings may result in dilution to shareholders, imposition of debt covenants and repayment obligations or other restrictions that may affect our business.

For more information as to the risks associated with our future funding needs, see “Part I, Item 1A—Risk Factors—Risks Related to Our Business and Industry—We will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product development, other operations or commercialization efforts” in our Annual Report on Form 10-K for the year ended December 31, 2018, as filed with the SEC on February 28, 2019.

Our capital expenditures for the three-month periods ended March 31, 2019 and 2018 amounted to $138,000 and $122,000, respectively. During the three months ended March 31, 2019, these expenditures were primarily related to laboratory equipment and leasehold improvements.

Off-Balance Sheet Arrangements

As of March 31, 2019, we did not have any off-balance sheet arrangements.

Contractual Obligations

In March 2019 we signed an amendment to our current lease agreement for our executive offices in the United States which are located in Bridgewater, New Jersey. Pursuant to the amendment we will lease a total of approximately 15,000 square feet of office space for 36 months following a preparation period by the lessor, expected to end August 1, 2019.

Critical Accounting Policies and Significant Judgments and Estimates

We prepare our consolidated financial statements in accordance with generally accepted accounting principles in the United States. The preparation of consolidated financial statements also requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ significantly from the estimates made by our management. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected.

While our significant accounting policies are more fully described in Note 2–“Significant Accounting Policies,” to the consolidated financial statements included in “Item 8—Financial Statements and Supplementary Data” of our Annual Report on Form 10-K for the year ended December 31, 2018, as filed with the SEC on February 28, 2019, and in Note 2, “Significant Accounting Policies,” in the accompanying notes to our  unaudited condensed consolidated financial statements, we believe that the following accounting policies are the most critical to assist shareholders and investors reading the consolidated financial statements in fully understanding and evaluating our financial condition and results of operations. These policies relate to the more significant areas involving management’s judgments and estimates and they require our most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

Clinical trial accruals

Clinical trial costs are charged to research and development expense as incurred. We accrue for expenses resulting from obligations under contracts with clinical research organizations, or CROs. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided. Our objective is to reflect the appropriate trial expense in the consolidated financial statements by matching the appropriate expenses with the period in which services and efforts are expended. In the event advance payments are made to a CRO, the payments will be recorded as other assets, which will be recognized as expenses as services are rendered. The CRO contracts generally include pass-through fees including, but not limited to, regulatory expenses, investigator fees, travel costs and other miscellaneous costs. We estimate our clinical accruals based on reports from and discussion with clinical personnel and the CRO as to the progress or state of completion of the trials. We estimate accrued expenses as of each balance sheet date in the consolidated financial statements based on the facts and circumstances known at that time. Our clinical trial accrual is dependent, in part, upon the receipt of timely and accurate reporting from the CROs.

15


Recently Issued Accounting Pronouncements

For a discussion of certain recently issued accounting pronouncements, refer to Note 2, “Significant Accounting Policies,” in the accompanying notes to the condensed consolidated financial statements.

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

As a “smaller reporting company,” as defined by Item 10 of Regulation S-K, we are not required to provide quantitative or qualitative disclosures about market risk.

ITEM 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company's management, including its chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act and regulations promulgated thereunder) as of March 31, 2019. Based on such evaluation, those officers have concluded that, as of March 31, 2019, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the three months ended March 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings
 
From time to time, we may become involved in litigation or other legal proceedings relating to claims that we consider to be arising from the ordinary course of our business. There are currently no claims or actions pending against us that, in the opinion of our management, are likely to have a material effect on our business.

ITEM 1A. Risk Factors

There have been no material changes from the risk factors disclosed in “Part I, Item 1A—Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2018, as filed with the SEC on February 28, 2019.
 
16

 
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

ITEM 3. Defaults Upon Senior Securities

Not applicable.

ITEM 4. Mine Safety Disclosures

Not applicable.

ITEM 5. Other Information

On May 6, 2019, the Company entered into amendments to the offer letter agreement with Mutya Harsch, the Company’s Chief Legal Officer, and to the employment agreement with Ilan Hadar, the Company’s Chief Financial Officer.

The amendment to Ms. Harsch’s offer letter agreement provides that if her employment is terminated by the Company without “cause,” or she terminates her employment with “good reason,” within the six month period before, or the twelve month period after a “change of control” (each as defined in the offer letter amendment), she will be entitled to receive a change of control payment equal to (1) twelve months of her then current base salary and (2) a reimbursement of her COBRA premiums until the earlier of (a) the first anniversary of her date of termination of employment or (b) the date on which she becomes covered under another employer’s medical plan. In addition, in the event of such a termination, all of Ms. Harsch’s unvested share options and restricted share units will become fully vested.

The amendment to Mr. Hadar’s employment agreement provides that if the employee’s employment is terminated by the Company without “cause” or by the employee for “good reason” within the six month period before, or the twelve month period after a “change of control” (each as defined in the amendments to the employment agreements), (1) the employees will be entitled to receive a payment equal to eighteen months of the employee’s then current salary and (2) all of the employee’s unvested share options and restricted share units will become fully vested.

The foregoing descriptions of the amendments do not purport to be complete and are qualified in their entirety by reference to the amendment to the offer letter and the amendment to the employment agreement, which are attached to this Quarterly Report on Form 10-Q as Exhibit 10.2 and 10.3, respectively, and are incorporated herein by reference.
 
17


ITEM 6. Exhibits

Exhibit Number
 
Description Of Document
 
Form
 
SEC File No.
 
Exhibit
 
Filing Date
 
Filed Herewith
                 
X
                 
X
                 
X
                 
X
                 
X
                 
X
                 
X
                 
X
                 
X
                 
X
101.INS
 
XBRL Instance Document
                 
X
101.SCH
 
XBRL Taxonomy Extension Schema Document
                 
X
101.CAL
 
XBRL Taxonomy Extension Calculation Linkbase Document
                 
X
101.DEF
 
XBRL Taxonomy Extension Definition Document
                 
X
101.LAB
 
XBRL Taxonomy Extension Label Document
                 
X
101.PRE
 
XBRL Taxonomy Presentation Linkbase Document
                 
X

# Indicates management contract or compensatory plan.
* These certifications are being furnished solely to accompany this quarterly report pursuant to 18 U.S.C. Section 1350, and are not being filed for purposes of Section 18 of the Exchange Act, as amended, and are not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
 
18

 
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
  FOAMIX PHARMACEUTICALS LTD.  
       
Date: May 7, 2019
By:
/s/ David Domzalski
 
   
David Domzalski
 
   
Chief Executive Officer
(Principal Executive Officer)
 
       
Date: May 7, 2019
By:
/s/ Ilan Hadar
 
   
Ilan Hadar
 
   
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
 
 
 
19