NewAmsterdam Pharma Co N.V. (NASDAQ:NAMS), a pharmaceutical company, announced today that it will restate its previously issued financial statements for the years ended December 31, 2022, and 2021, as well as for each of the three years in the period ended December 31, 2022. This decision was made after the Audit Committee of the company's Board of Directors, in consultation with management and the independent registered public accounting firm, found errors in the calculation of the net loss per ordinary share.
The company, which is based in Naarden, The Netherlands, identified that the weighted average number of ordinary shares outstanding was incorrectly reported as the actual number of shares outstanding at the end of each period. Consequently, this led to an inaccurate reporting of the company's net loss per ordinary share in the affected financial statements.
The errors are confined to the financial statements prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. These statements were included in NewAmsterdam Pharma's Annual Report on Form 20-F for the year ended December 31, 2022.
Notably, the consolidated financial statements as of December 31, 2023, and for the three-year period ending on that date, which were prepared in accordance with U.S. generally accepted accounting principles and included in the company's Annual Report on Form 10-K, did not contain these errors.
The company has communicated the issues disclosed to its independent registered public accounting firm, Deloitte Accountants B.V. As a corrective measure, NewAmsterdam Pharma intends to file an amendment to the 2022 Annual Report to restate the affected financial statements. This filing will be made with the Securities and Exchange Commission as soon as practicable.
In other recent news, NewAmsterdam Pharma Co NV has been making significant strides in its clinical trials. The pharmaceutical company reported successful outcomes from its Phase 3 BROOKLYN clinical trial, which showed a substantial reduction in low-density lipoprotein cholesterol in patients with heterozygous familial hypercholesterolemia. The drug obicetrapib, evaluated in the trial, demonstrated a significant ability to reduce LDL-C levels.
NewAmsterdam Pharma has also announced the appointment of Mark C. McKenna and Wouter Joustra to its Board of Directors, a strategic move as the company prepares for pivotal Phase 3 data readouts from ongoing clinical trials. This development comes on the heels of analyst endorsements. Piper Sandler reiterated its Overweight rating on the company, maintaining a positive outlook on its prospects. Similarly, TD Cowen reaffirmed a Buy rating on NewAmsterdam's shares, reflecting the firm's confidence in obicetrapib's clinical profile and its potential to improve patients' health outcomes.
InvestingPro Insights
In light of NewAmsterdam Pharma's (NASDAQ:NAMS) announcement regarding the restatement of its financial statements, investors may find additional context from recent financial metrics and analyst insights valuable. According to InvestingPro data, NAMS currently has a market capitalization of $1.73 billion USD, reflecting the market's current valuation of the company despite the reported accounting errors.
InvestingPro Tips highlight that NAMS holds more cash than debt on its balance sheet, which could provide financial flexibility as the company navigates through this restatement process. Additionally, the company's liquid assets exceed short-term obligations, potentially offering a buffer during this period of financial recalibration.
However, it's important to note that NAMS is not currently profitable, with a negative P/E ratio of -8.63 for the last twelve months as of Q2 2024. This aligns with another InvestingPro Tip indicating that analysts do not anticipate the company will be profitable this year.
Despite these challenges, NAMS has shown strong market performance, with a one-year price total return of 153.73% as of the latest data. This suggests that investors have been optimistic about the company's prospects, even in the face of current profitability concerns.
For those seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for NAMS, providing a deeper dive into the company's financial health and market position.
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