GlobeNewswire Inc | Aug 16, 2021 04:01PM EDT

August 16, 2021

Net revenue for second quarter of 2021 increased 89% year-over-year to $17.8 million, a quarterly record

Rolling NDA submission for CUTX-101 for the treatment of Menkes disease expected to begin in the second half of 2021

On track to report top-line results from registration-enabling study of cosibelimab in metastatic cutaneous squamous cell carcinoma by year-end 2021

NEW YORK, Aug. 16, 2021 (GLOBE NEWSWIRE) -- Fortress Biotech, Inc. (NASDAQ: FBIO) (Fortress), an innovative biopharmaceutical company focused on acquiring, developing and commercializing or monetizing promising biopharmaceutical products and product candidates cost-effectively, today announced financial results and recent corporate highlights for the second quarter ended June 30, 2021.

Lindsay A. Rosenwald, M.D., Fortress Chairman, President and Chief Executive Officer, said, We generated significant sales momentum in the second quarter, recording quarterly record net revenues of $17.8 million, an 89% increase year-over-year. We also successfully acquired and recently launched QBREXZA to further expand our portfolio of marketed products, as well as in-licensed Dotinurad, DFD-29, and a novel CAR T technology, which enhance our robust pipeline of drug candidates. In addition, we presented compelling clinical data for CAEL-101 for the treatment of AL amyloidosis and MB-106 for relapsed or refractory B-cell non-Hodgkin lymphomas (B-NHL) and chronic lymphocytic leukemia (CLL) at the European Hematology Association 2021 Virtual Congress (EHA2021). Looking ahead, we anticipate several additional regulatory and clinical catalysts throughout the remainder of 2021, including the availability of pivotal data from cosibelimab for the treatment of metastatic cutaneous squamous cell carcinoma. We also expect to begin the rolling New Drug Application (NDA) submission for CUTX-101 for the treatment of Menkes disease in the second half of 2021.

Dr. Rosenwald continued, We have an expanding portfolio of seven marketed dermatology products and more than 25 product candidates across our partner companies, including 18 clinical programs and 24 clinical trials, of which four are pivotal clinical trials, and up to four more could potentially be pivotal soon. Our diversified business model is supported by a world-class business development team. Fortress and our partner companies are well-positioned to achieve an array of milestones over the next year and into the future with the objective of providing new treatment options to patients in need, while creating significant long-term value for our shareholders.

Recent Corporate Highlights1

Marketed Dermatology Products and Product Candidates

-- Our seven dermatology products are marketed by our partner company, Journey Medical Corporation (Journey). -- Our products generated net revenues of $15.3 million for the second quarter of 2021, compared to second quarter 2020 net revenues of $9.4 million. -- In July 2021, Journey completed its final closing under the Cumulative Convertible Class A Preferred Stock Offering (the Preferred Offering). In connection with the Preferred Offering, Journey issued an aggregate of 750,680 preferred shares at a price of $25.00 per share, and after deducting commissions, fees and expenses, for a total of approximately $16.8 million in net proceeds across the various closings. -- In June 2021, Journey entered into a definitive agreement with Dr. Reddys Laboratories Ltd. to develop and commercialize DFD-29 (modified release minocycline capsules) for the treatment of rosacea. Journey and Dr. Reddys Laboratories Ltd. intend to conduct two Phase 3 clinical trials to assess the efficacy, safety and tolerability of DFD-29 for regulatory approval. -- In May 2021, Journey acquired and recently launched its seventh prescription dermatology product, QBREXZA. -- In April 2021, Journey entered into an agreement with East West Bank (EWB) in which EWB provided a $7.5 million working capital line of credit. -- Journey intends to launch one additional prescription product in the second half of this year.

CUTX-101 (Copper Histidinate for Menkes disease)

-- We intend to begin the rolling submission of the NDA for CUTX-101 to the U.S. Food and Drug Administration (FDA) in the second half of 2021. -- CUTX-101 was sourced by Fortress and is currently in development at our partner company, Cyprium Therapeutics, Inc.

CAEL-101 (Light Chain Fibril-reactive Monoclonal Antibody for AL Amyloidosis)

-- Caelum Biosciences, Inc. (Caelum) has two ongoing Phase 3 studies of CAEL-101 for AL amyloidosis. -- Caelum formed a collaboration with Alexion Pharmaceuticals, Inc. (Alexion) in 2019, which included an option to acquire Caelum. AstraZeneca completed its acquisition of Alexion on July 21, 2021. The period during which AstraZeneca/Alexion must now decide whether or not to exercise their option to purchase Caelum expires in January 2022. Fortress would receive approximately 43 percent of the proceeds from a potential AstraZeneca transaction. -- In June 2021, we announced that CAEL-101 clinical data were presented at EHA2021. The data, presented in two e-posters, strengthen the safety and tolerability profile of CAEL-101 to further support the dose selection for the ongoing Phase 3 study, and suggest possible cardiac and renal response. -- Also in June 2021, the FDA granted Fast Track designation to CAEL-101 for the treatment of light chain AL amyloidosis. -- CAEL-101 was sourced by Fortress and is currently in development at Caelum Biosciences, Inc., a company founded by Fortress in 2017 and in which Fortress maintains a minority position.

Cosibelimab (formerly CK-301, an anti-PD-L1 antibody)

-- The registration-enabling study in metastatic cutaneous squamous cell carcinoma is fully enrolled and we are on track to report top-line results by year-end 2021. Upon a successful outcome, Checkpoint Therapeutics, Inc. (Checkpoint) intends to submit a Biologics License Application (BLA) for cosibelimab in 2022, followed shortly thereafter by a Marketing Authorization Application submission in Europe. With a potentially favorable safety profile versus anti-PD-1 therapy and a plan to commercialize at a substantially lower price, we believe cosibelimab has the potential to be a market disruptive product in the $25 billion and growing PD-(L)1 class. -- A Phase 3 registration-enabling trial is planned to begin in first-line metastatic non-small cell lung cancer (NSCLC) in the second half of 2021. -- Cosibelimab was sourced by Fortress and is currently in development at our partner company, Checkpoint.

Olafertinib (formerly CK-101, a third-generation epidermal growth factor receptor (EGFR) inhibitor)

-- During the second quarter, we had productive interactions with the FDA regarding our development program for olafertinib (formerly CK-101), our third-generation EGFR inhibitor being evaluated by our partner in an ongoing double-blind, randomized Phase 3 study in China. We intend to utilize the Phase 3 study, if successful, to support an NDA submission for olafertinib as a potential first-line treatment for patients with NSCLC whose tumors have certain types of EGFR mutations. -- Olafertinib was sourced by Fortress and is currently in development at our partner company, Checkpoint.

MB-106 (CD20-targeted CAR T Cell Therapy)

-- In May 2021, we announced that the FDA approved Mustang Bio Inc.s (Mustang Bio) Investigational New Drug (IND) application to initiate a multicenter Phase 1/2 clinical trial investigating the safety and efficacy of MB-106, a CD20-targeted CAR T for relapsed or refractory B-NHL and CLL. -- In June 2021, we announced that MB-106 CD20-targeted CAR T data were presented at EHA2021. Dr. Mazyar Shadman of Fred Hutchinson Cancer Research Center presented updated interim data from the ongoing Phase 1/2 clinical trial for B-NHL and CLL, which showed a favorable safety profile and compelling clinical activity, with a 93% overall response rate and 67% complete response rate in patients treated with the modified cell manufacturing process. -- Also in June 2021, we hosted a key opinion leader webinar featuring a presentation from Dr. Shadman, who discussed interim results from the ongoing Phase 1/2 clinical trial investigating the safety and efficacy of MB-106 CD20-targeted CAR T for B-NHL and CLL. A replay of the webinar can be found here. -- MB-106 was sourced by Fortress and is currently in development at our partner company, Mustang Bio.

MB-107 and MB-207 (Lentiviral Gene Therapies for X-linked Severe Combined Immunodeficiency (XSCID))

-- Earlier this month, we announced that the European Medicines Agency (EMA) granted Priority Medicines (PRIME) designation to MB-107, a lentiviral gene therapy for the treatment of XSCID in newly diagnosed infants, also known as bubble boy disease. -- Later this quarter, we expect to enroll the first patient in the MB-107 pivotal multicenter Phase 2 clinical trial under Mustang Bios IND and to file an IND for our pivotal multicenter Phase 2 clinical trial of MB-207. -- MB-107 and MB-207 were sourced by Fortress and are currently in development at our partner company, Mustang Bio.

MB-101 (IL13R2-targeted CAR T Cell Therapy)

-- In May 2021, we announced that the first patient was dosed at City of Hope in a clinical trial to establish the safety and feasibility of administering MB-101 (autologous IL13R2-targeted CAR T cells) to patients with leptomeningeal brain tumors (e.g., glioblastoma, ependymoma or medulloblastoma). -- MB-101 was sourced by Fortress and is currently in development at our partner company, Mustang Bio.

Novel CAR T Technology

-- In August 2021, we announced an exclusive license agreement with Mayo Clinic for a novel technology that may be able to transform the administration of CAR T therapies and has the potential to be used as an off-the-shelf therapy. -- The novel CAR T technology was sourced by Fortress and is currently in development at our partner company, Mustang Bio.

Dotinurad (Urate Transporter (URAT1) Inhibitor)

-- In May 2021, we announced an exclusive license agreement with Fuji Yakuhin Co. Ltd. to develop Dotinurad in North America, Europe, United Kingdom and Canada. Dotinurad is a potential best-in-class urate transporter (URAT1) inhibitor for gout and possibly other hyperuricemic indications, including chronic kidney disease and heart failure. Dotinurad (URECE tablet) was approved in Japan in 2020 as a once-daily oral therapy for gout and hyperuricemia. Dotinurad was efficacious and well-tolerated in more than 500 Japanese patients treated for up to 58 weeks in Phase 3 clinical trials. -- Dotinurad was sourced by Fortress and is currently in development at our partner company, FBIO Acquisition Corp. VIII.

Financial Results:

To assist our stockholders in understanding our company, we have prepared non-GAAP financial results for the three months ended June 30, 2021 and 2020. These results exclude the operations of our three public partner companies: Avenue, Checkpoint and Mustang Bio. The goal in providing these non-GAAP financial metrics is to highlight the financial results of Fortress core operations, which are comprised of our commercial-stage business, our privately held development-stage entities, as well as our business development and finance functions.

-- As of June 30, 2021, Fortress consolidated cash, cash equivalents and restricted cash totaled $276.6 million, compared to $235.0 million as of December 31, 2020, an increase of $41.6 million year-to-date. -- On a GAAP basis, Fortress net revenue totaled $17.8 million for the second quarter of 2021, which included $15.3 million in net revenue generated from our marketed dermatology products. This compares to net revenue totaling $9.5 million for the second quarter of 2020, which included $9.4 million in net revenue generated from our marketed dermatology products. -- On a GAAP basis, consolidated research and development expenses, including license acquisitions of $11.0 million, were $33.8 million for the second quarter of 2021, compared to consolidated research and development expenses, including license acquisitions of $1.6 million, totaling $17.3 million for the second quarter of 2020. On a non-GAAP basis, research and development expenses including license acquisitions of $10.0 million, were $14.5 million for the second quarter of 2021, compared to research and development expenses, including license acquisitions of $0.3 million, totaling $4.8 million for second quarter of 2020. -- On a GAAP basis, consolidated selling, general and administrative expenses were $19.4 million for the second quarter of 2021, compared to $14.5 million for the second quarter of 2020. On a non-GAAP basis, consolidated selling, general and administrative expenses were $14.9 million, of which $7.6 million is attributed to Journey, for the second quarter of 2021, compared to $10.4 million, of which $4.7 million is attributed to Journey, for the second quarter of 2020. -- On a GAAP basis, consolidated net loss attributable to common stockholders was $3.5 million, or $0.04 per share, for the second quarter of 2021, compared to consolidated net loss attributable to common stockholders of $13.3 million, or $0.19 per share for the second quarter of 2020. -- Fortress non-GAAP loss attributable to common stockholders was $14.1 million, which includes $10 million related to Journeys acquisition of DFD-29 and excludes the change in fair value of Fortress investment in Caelum, or $0.17 per share, for the second quarter of 2021, compared to Fortress non-GAAP loss attributable to common stockholders of $3.7 million, or $0.05 per share, for the second quarter of 2020. -- The tables below have more information.

Use of Non-GAAP Measures:

In addition to the GAAP financial measures as presented in our Form 10-Q that will be filed with the Securities and Exchange Commission (SEC) on August 16, 2021, the Company has, in this press release, included certain non-GAAP measurements. The non-GAAP net income (loss) attributable to common stockholders is defined by the Company as GAAP net income (loss) attributable to common stockholders, less net losses attributable to common stockholders from our public partner companies Avenue, Checkpoint and Mustang Bio. In addition, the Company has also provided a Fortress non-GAAP loss attributable to common stockholders which is a modified EBITDA calculation that starts with the non-GAAP income (loss) attributable to common stockholders and removes stock-based compensation expense, non-cash interest expense, amortization of licenses and debt discount, changes in fair values of investment, changes in fair value of derivative liability, Qbrexza inventory step-up and depreciation expense.

Management believes use of these non-GAAP measures provide meaningful supplemental information regarding the Company's performance because (i) it allows for greater transparency with respect to key measures used by management in its financial and operational decision-making, (ii) it excludes the impact of non-cash or, when specified, non-recurring items that are not directly attributable to the Company's core operating performance and that may obscure trends in the Company's core operating performance and (iii) it is used by institutional investors and the analyst community to help analyze the Company's results. However, non-GAAP income (loss) attributable to common stockholders and any other non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Further, non-GAAP financial measures used by the Company and the manner in which they are calculated may differ from the non-GAAP financial measures or the calculations of the same non-GAAP financial measures used by other companies, including the Company's competitors.

The tables below provide a reconciliation from GAAP to non-GAAP measures:

For the three months ended June For the six months ended June 30, 30,($ inthousandsexcept for 2021 2020 2021 2020 share andper shareamounts)Net lossattributable $ (3,535 ) $ (13,314 ) $ (12,357 ) $ (25,684 ) to commonstockholdersNet lossattributableto common (215 ) (431 ) (440 ) (718 ) stockholders- Avenue^1Net lossattributableto common (1,711 ) (1,045 ) (2,869 ) (1,798 ) stockholders- Checkpoint^2Net lossattributableto common (2,496 ) (3,732 ) (5,414 ) (7,332 ) stockholders- MustangBio^3Non-GAAP netincome(loss) $ 887 $ (8,106 ) $ (3,634 ) $ (15,836 ) attributableto commonstockholdersStock based 2,921 1,844 4,811 3,584 compensationNon-cash 497 1,713 707 2,482 interestAmortization 741 355 1,325 710 of licensesAmortizationof debt 595 390 903 878 discountDepreciation 137 151 278 305 Increase infair value (25,005 ) - (30,918 ) - ofinvestment^4Change infair valueof 3,925 - 344 - derivativeliabilities^5Qbrexzainventory 1,238 - 1,238 - step-up^6Fortressnon-GAAPloss $ (14,064 ) $ (3,653 ) $ (24,946 ) $ (7,877 ) attributableto commonstockholders Per commonshare - basic anddiluted:Net income(loss)attributable $ (0.04 ) $ (0.19 ) $ (0.15 ) $ (0.39 ) to commonstockholders(GAAP)Non-GAAP netincome(loss) $ 0.01 $ (0.12 ) $ (0.04 ) $ (0.24 ) attributableto commonstockholdersFortressnon-GAAPloss $ (0.17 ) $ (0.05 ) $ (0.31 ) $ (0.12 ) attributableto commonstockholders Weightedaveragecommonshares 80,962,994 68,550,494 80,907,671 66,023,367 outstanding- basic anddiluted



-- Avenue net loss from their external SEC report for the three months ended June 30, 2021 and 2020 of $0.9 million and $1.9 million, respectively, net of non-controlling interest of $0.7 million and $1.4 million, respectively. Avenue net loss from their external SEC report for the six months ended June 30, 2021 and 2020 of $2.0 million and $3.1 million, respectively, net of non-controlling interest of $1.5 million and $2.4 million, respectively. -- Checkpoint net loss from their external SEC report of $9.1 million net of non-controlling interest of $7.1 million, MSA fee to Fortress of $0.1 million and financing fee to Fortress of $0.3 million for the quarter ended June 30, 2021; and net loss of $4.6 million net of non-controlling interest of $3.4 million, less MSA fee to Fortress of $0.1 million and financing fee to Fortress of $0.1 million for the quarter ended June 30, 2020. Checkpoint net loss from their external SEC report of $15.6 million net of non-controlling interest of $11.6 million, MSA fee to Fortress of $0.1 million and financing fee to Fortress of $0.9 million for the six months ended June 30, 2021; and net loss of $7.9 million net of non-controlling interest of $5.8 million, less MSA fee to Fortress of $0.3 million and financing fee to Fortress of $0.1 million for the six months ended June 30, 2020. -- Mustang Bio net loss from their external SEC report of $14.4 million net of non-controlling interest of $11.3 million, MSA fee to Fortress of $0.1 million and financing fee to Fortress of $0.4 million for the quarter ended June 30, 2021; and net loss of $14.6 million net of non-controlling interest of $9.7 million, MSA fee to Fortress of $0.1 million and financing fee to Fortress of $1.0 million for the quarter ended June 30, 2020. Mustang Bio net loss from their external SEC report of $29.3 million net of non-controlling interest of $22.1 million, MSA fee to Fortress of $0.3 million and financing fee to Fortress of $1.6 million for the six months ended June 30, 2021; and net loss of $26.5 million net of non-controlling interest of $17.7 million, MSA fee to Fortress of $0.3 million and financing fee to Fortress of $1.1 million for the six months ended June 30, 2020. -- Increase in fair value of investment in Caelum Biosciences for the quarter and six months ended June 30, 2021. -- Increase in fair value of derivative liabilities of Journey Medical Corporation for the quarter and six months ended June 30, 2021. -- Step-up related to FV of Qbrexza inventory sold and recorded in COGS for the quarter and six months ended June 30, 2021.

Reconciliation to non-GAAP research and development and selling, general and administrative costs:

For the quarter ended For the six months June 30, ended June 30,($ in thousands) 2021 2020 2021 2020 Research and development $ 33,834 $ 17,273 $ 53,988 $ 32,390 ^1Less: Research and development 328 1,219 586 1,916 AvenueResearch and development 7,198 3,029 11,411 5,664 CheckpointResearch and development 11,840 9,771 23,395 19,023 Mustang Bio ^2Non-GAAP research and $ 14,468 $ 3,254 $ 18,596 $ 5,787 development costs Selling, general and $ 19,382 $ 14,456 $ 36,924 $ 29,975 administrativeLess: Selling, general and 623 684 1,366 1,261 administrative AvenueSelling, general andadministrative 1,736 1,496 3,350 3,049 Checkpoint ^3Selling, general andadministrative Mustang 2,086 1,917 4,296 3,685 Bio ^4Non-GAAP selling,general and $ 14,937 $ 10,359 $ 27,912 $ 21,980 administrative costs



-- Includes Research and development expense and Research and development - licenses acquired expense for the quarter and six month ended June 30, 2021 and 2020, respectively. -- Excludes $0.1 million and $0.1 million of Fortress MSA expense for the quarter ended June 30, 2021 and 2020, respectively and $0.1 million and $0.1 million for the six months ended June 30, 2021 and 2020, respectively. -- Excludes $0.1 million of Fortress MSA expense and $0.3 million Fortress financing fee for the quarter ended June 30, 2021; and $0.1 million of Fortress MSA expense and $0.1 million Fortress financing fee for the quarter ended June 30, 2020. Excludes $0.3 million of Fortress MSA expense and $0.9 million Fortress financing fee for the six months ended June 30, 2021; and $0.3 million of Fortress MSA expense and $0.1 million Fortress financing fee for the six months ended June 30, 2020. -- Excludes $0.1 million of Fortress MSA expense and $0.4 million Fortress financing fee for the quarter ended June 30, 2021; and $0.1 million of Fortress MSA expense and $1.0 million Fortress financing fee for the quarter ended June 30, 2020. Excludes $0.1 million of Fortress MSA expense and $1.6 million Fortress financing fee for the six months ended June 30, 2021; and $0.1 million of Fortress MSA expense and $1.1 million Fortress financing fee for the six months ended June 30, 2020.

About Fortress Biotech Fortress Biotech, Inc. (Fortress) is an innovative biopharmaceutical company that was ranked in Deloittes 2019 and 2020 Technology Fast 500, annual rankings of the fastest-growing North American companies in the technology, media, telecommunications, life sciences and energy tech sectors, based on percentages of fiscal year revenue growth over three-year periods. Fortress is focused on acquiring, developing and commercializing high-potential marketed and development-stage drugs and drug candidates. The company has seven marketed prescription pharmaceutical products and over 25 programs in development at Fortress, at its majority-owned and majority-controlled partners and at partners it founded and in which it holds significant minority ownership positions. Such product candidates span six large-market areas, including oncology, rare diseases and gene therapy, which allow it to create value for shareholders. Fortress advances its diversified pipeline through a streamlined operating structure that fosters efficient drug development. The Fortress model is driven by a world-class business development team that is focused on leveraging its significant biopharmaceutical industry expertise to further expand the companys portfolio of product opportunities. Fortress has established partnerships with some of the worlds leading academic research institutions and biopharmaceutical companies to maximize each opportunity to its full potential, including Alexion Pharmaceuticals, Inc., AstraZeneca, City of Hope, Fred Hutchinson Cancer Research Center, St. Jude Childrens Research Hospital, Nationwide Childrens Hospital and Sentynl Therapeutics, Inc. For more information, visit www.fortressbiotech.com.

Forward-Looking StatementsThis press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. As used below and throughout this press release, the words we, us and our may refer to Fortress individually or together with one or more partner companies, as dictated by context. Such statements include, but are not limited to, any statements relating to our growth strategy and product development programs and any other statements that are not historical facts. Forward-looking statements are based on managements current expectations and are subject to risks and uncertainties that could negatively affect our business, operating results, financial condition and stock price. Factors that could cause actual results to differ materially from those currently anticipated include: risks relating to our growth strategy; our ability to obtain, perform under and maintain financing and strategic agreements and relationships; risks relating to the results of research and development activities; uncertainties relating to preclinical and clinical testing; risks relating to the timing of starting and completing clinical trials; our dependence on third-party suppliers; risks relating to the COVID-19 outbreak and its potential impact on our employees and consultants ability to complete work in a timely manner and on our ability to obtain additional financing on favorable terms or at all; our ability to attract, integrate and retain key personnel; the early stage of products under development; our need for substantial additional funds; government regulation; patent and intellectual property matters; competition; as well as other risks described in our SEC filings. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations or any changes in events, conditions or circumstances on which any such statement is based, except as may be required by law, and we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The information contained herein is intended to be reviewed in its totality, and any stipulations, conditions or provisos that apply to a given piece of information in one part of this press release should be read as applying mutatis mutandis to every other instance of such information appearing herein.

Company Contacts:Jaclyn Jaffe and Bill BegienFortress Biotech, Inc.(781) 652-4500ir@fortressbiotech.com

Investor Relations Contact:Daniel FerryLifeSci Advisors, LLC(617) 430-7576daniel@lifesciadvisors.com

Media Relations Contact:Tony Plohoros6 Degrees(908) 591-2839tplohoros@6degreespr.com

FORTRESS BIOTECH, INC. AND SUBSIDIARIESCondensed Consolidated Balance Sheets ($ in thousands except for share and per share amounts)

June30, December31, 2021 2020 (Unaudited) ASSETS Current assets Cash and cash equivalents $ 274,992 $ 233,351 Accounts receivable, net 26,193 23,928 Inventory 14,315 1,404 Other receivables - related party 842 744 Prepaid expenses and other current assets 4,003 6,723 Total current assets 320,345 266,150 Property and equipment, net 13,126 11,923 Operating lease right-of-use asset, net 19,731 20,487 Restricted cash 1,645 1,645 Long-term investment, at fair value 48,484 17,566 Intangible asset, net 13,701 14,629 Other assets 1,126 1,013 Total assets $ 418,158 $ 333,413 LIABILITIES AND STOCKHOLDERS? EQUITY Current liabilities Accounts payable and accrued expenses $ 59,906 $ 45,389 Deferred revenue 4,800 ? Operating lease liabilities, short-term 2,035 1,849 Partner company installment payments - licenses,short-term (net of imputed interest of $639 and 3,861 4,522 $778 at June 30, 2021 and December 31, 2020,respectively)Total current liabilities 70,602 51,760 Notes payable, long-term (net of debt discountof $7,737 and $8,323 at June30,2021 and 52,263 51,677 December31,2020, respectively)Operating lease liabilities, long-term 21,906 22,891 Partner company installment payments - licenses,long-term (net of imputed interest of $565 and 6,435 8,137 $863 at June 30, 2021 and December 31, 2020,respectively)Partner company convertible preferred shares(net of debt discount of $1,824 at 12,508 ? June30,2021)Partner company derivative warrant liabilities 4,287 ? Other long-term liabilities 1,856 1,949 Total liabilities 169,857 136,414 Commitments and contingencies Stockholders? equity Cumulative redeemable perpetual preferred stock,$.001 par value, 15,000,000 authorized,5,000,000 designated Series A shares, 3,427,138shares issued and outstanding as of 3 3 June30,2021 and December31,2020,respectively, liquidation value of $25.00 pershareCommon stock, $.001 par value, 170,000,000shares authorized, 97,495,244 shares issued andoutstanding as of June30,2021; 150,000,000 97 95 shares authorized, 94,877,492 shares issued andoutstanding as of December31,2021,respectivelyCommon stock issuable, 78,671 and 0 shares as ofJune30,2021 and December31,2020, 263 ? respectivelyAdditional paid-in-capital 603,035 583,000 Accumulated deficit (495,117 ) (482,760 )Total stockholders' equity attributed to the 108,281 100,338 Company Non-controlling interests 140,020 96,661 Total stockholders' equity 248,301 196,999 Total liabilities and stockholders' equity $ 418,158 $ 333,413

FORTRESS BIOTECH, INC. AND SUBSIDIARIESCondensed Consolidated Statements of Operations ($ in thousands except for share and per share amounts)(Unaudited)

Three Months Ended June30, Six Months Ended June30, 2021 2020 2021 2020 Revenue Product $ 15,288 $ 9,415 $ 26,007 $ 21,361 revenue, netCollaboration 2,400 ? 3,200 ? revenueRevenue - 155 42 223 1,014 related partyNet revenue 17,843 9,457 29,430 22,375 Operating expensesCost of goodssold - product 7,484 3,124 11,392 6,934 revenueResearch and 22,831 15,703 42,859 30,570 developmentResearch anddevelopment - 11,003 1,570 11,129 1,820 licensesacquiredSelling,general and 19,382 14,456 36,924 29,975 administrativeTotal operating 60,700 34,853 102,304 69,299 expensesLoss from (42,857 ) (25,396 ) (72,874 ) (46,924 ) operations Other income (expense)Interest income 146 336 373 963 Interestexpense and (2,760 ) (3,059 ) (4,949 ) (6,184 ) financing feeChange in fairvalue of 25,005 ? 30,918 ? investmentsChange in fairvalue of (3,925 ) (344 ) (3,925 ) (386 ) derivativeliabilityTotal otherincome 18,466 (3,067 ) 22,417 (5,607 ) (expense)Net loss (24,391 ) (28,463 ) (50,457 ) (52,531 ) Less: net lossattributable to 20,856 15,149 38,100 26,847 non-controllinginterestsNet lossattributable to $ (3,535 ) $ (13,314 ) $ (12,357 ) $ (25,684 ) commonstockholders Net loss percommon share - $ (0.30 ) $ (0.42 ) $ (0.62 ) $ (0.80 ) basic anddilutedNet loss percommon shareattributable tonon - $ (0.26 ) $ (0.22 ) $ (0.47 ) $ (0.41 ) controllinginterests -basic anddilutedNet loss percommon shareattributable tocommon $ (0.04 ) $ (0.19 ) $ (0.15 ) $ (0.39 ) stockholders -basic anddiluted Weightedaverage commonshares 80,962,994 68,550,494 80,907,671 66,023,367 outstanding -basic anddiluted



1 Includes product candidates in development at Fortress, majority-owned and controlled partners and partners in which Fortress holds significant minority ownership positions. As used herein, the words we, us and our may refer to Fortress individually or together with our affiliates and partners, as dictated by context.