UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16

Under the Securities Exchange Act of 1934

For the Month of November 2019

001-36345

(Commission File Number)

GALMED PHARMACEUTICALS LTD.

(Exact name of Registrant as specified in its charter)

16 Tiomkin St.

Tel Aviv 6578317, Israel

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover

Form 20-F or Form 40-F.

Form 20-F  x   Form 40-F  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by

Regulation S-T Rule 101(b)(1): ____

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by

Regulation S-T Rule 101(b)(7): ____

This Form 6-K contains the quarterly report of Galmed Pharmaceuticals Ltd. (the “Company”), which includes the Company’s unaudited consolidated financial statements for the three and nine months ended September 30, 2019, together with related information and certain other information. The Company is not subject to the requirements to file quarterly or certain other reports under Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended. The Company does not undertake to file or cause to be filed any such reports in the future, except to the extent required by law.

On November 6, 2019, the Company issued a press release announcing the filing of its financial results for the three and nine months ended September 30, 2019 with the Securities and Exchange Commission. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

This Form 6-K and the text under the heading “Financial Summary - Third Quarter 2019 vs. Third Quarter 2018” in Exhibit 99.1 is incorporated by reference into the Company’s Registration Statement on Form S-8 (Registration No. 333-206292 and 333-227441) and the Company’s Registration Statement on Form F-3 (Registration No. 333-223923). 

FINANCIAL INFORMATION

Financial Statements

The accompanying notes are an integral part of the interim consolidated financial statements.

The accompanying notes are an integral part of the interim consolidated financial statements.

The accompanying notes are an integral part of the interim consolidated financial statements.

 (*) Less than 1 thousand $.

The accompanying notes are an integral part of the interim consolidated financial statements.

The accompanying notes are an integral part of the interim consolidated financial statements.

Note 1 - Basis of presentation

Galmed Pharmaceuticals Ltd. (the “Company”) is a clinical-stage biopharmaceutical company primarily focused on the development of therapeutics for the treatment of liver diseases. The Company was incorporated in Israel on July 31, 2013 and commenced operations on February 2, 2014. The Company holds a wholly-owned subsidiary, Galmed International Ltd., which was incorporated in Malta. Galmed International Ltd. previously held a wholly-owned subsidiary, Galmed Medical Research Ltd., which was incorporated in Israel, and had been an inactive company since 2015 and was liquidated during the first quarter of 2019. The Company also holds a wholly-owned subsidiary, Galmed Research and Development Ltd., which was incorporated in Israel.

These unaudited interim consolidated financial statements have been prepared as of September 30, 2019 and for the three and nine months period then ended. Accordingly, certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. These unaudited interim consolidated financial statements should be read in conjunction with the audited financial statements and the accompanying notes of the Company for the year ended December 31, 2018 that are included in the Company's Annual Report on Form 20-F, filed with the Securities and Exchange Commission on March 13, 2019 (the "Annual Report"). The results of operations presented are not necessarily indicative of the results to be expected for the year ending December 31, 2019.

Note 2 - Summary of significant accounting policies

The significant accounting policies that have been applied in the preparation of the unaudited consolidated interim financial statements are identical to those that were applied in preparation of the Company’s most recent annual financial statements in connection with its Annual Report on Form 20-F except for the adoption of Accounting Standards Update (‘ASU”) 2016-02.

In February 2016, the Financial Accounting Standards Board issued ASU 2016-02, Leases (Topic 842). This ASU requires entities that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by leases with lease terms of more than 12 months. The Company adopted this ASU effective January 1, 2019 using the modified retrospective application, applying the new standard to leases in place as of the adoption date. Prior periods have not been adjusted.

Recently issued accounting pronouncements

In May 2019, the FASB issued ASU 2019-05—Financial Instruments—Credit Losses (Topic 326): Targeted Transition Relief. The amendments in ASU No. 2019-05 provide an option to irrevocably elect the fair value option, on an instrument-by-instrument basis, for eligible financial assets measured on an amortized cost basis upon adoption of the credit losses standard. The ASU is effective for the Company beginning on January 1, 2020.

Note 3 - Stockholders' Equity

Management’s Discussion and Analysis of Financial Condition and Results of Operations

All references to “we,” “us,” “our,” “the Company” and “our Company”, in this Form 6-K are to Galmed Pharmaceuticals Ltd. and its subsidiaries, unless the context otherwise requires. All references to “shares” or “ordinary shares” are to our ordinary shares, NIS 0.01 nominal par value per share. All references to “Israel” are to the State of Israel. “U.S. GAAP” means the generally accepted accounting principles of the United States. Unless otherwise stated, all of our financial information presented in this Form 6-K has been prepared in accordance with U.S. GAAP. Any discrepancies in any table between totals and sums of the amounts and percentages listed are due to rounding. Unless otherwise indicated, or the context otherwise requires, references in this Form 6-K to financial and operational data for a particular year refer to the fiscal year of our company ended December 31 of that year.

Our reporting currency and financial currency is the U.S. dollar. In this Form 6-K, “NIS” means New Israeli Shekel, and “$,” “US$” and “U.S. dollars” mean United States dollars.

Cautionary Note Regarding Forward-Looking Statements

This Form 6-K contains forward-looking statements about our expectations, beliefs or intentions regarding, among other things, our product development efforts, business, financial condition, results of operations, strategies or prospects. In addition, from time to time, we or our representatives have made or may make forward-looking statements, orally or in writing. Forward-looking statements can be identified by the use of forward-looking words such as “believe,” “expect,” “intend,” “plan,” “may,” “should,” “anticipate,” “could,” “might,” “seek,” “target,” “will,” “project,” “forecast,” “continue” or their negatives or variations of these words or other comparable words or by the fact that these statements do not relate strictly to historical matters. These forward-looking statements may be included in, among other things, various filings made by us with the SEC, press releases or oral statements made by or with the approval of one of our authorized executive officers. Forward-looking statements relate to anticipated or expected events, activities, trends or results as of the date they are made. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties that could cause our actual results to differ materially from any future results expressed or implied by the forward-looking statements. Many factors could cause our actual activities or results to differ materially from the activities and results anticipated in forward-looking statements, including, but not limited to, the factors summarized below:

We believe these forward-looking statements are reasonable; however, these statements are only current predictions and are subject to known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from those anticipated by the forward-looking statements. We discuss many of these risks in our Annual Report on Form 20-F for the year ended December 31, 2018 filed with the SEC on March 13, 2019 in greater detail under the heading “Risk Factors” and elsewhere in the Annual Report and this Form 6-K. Given these uncertainties, you should not rely upon forward-looking statements as predictions of future events. 

All forward-looking statements attributable to us or persons acting on our behalf speak only as of the date hereof and are expressly qualified in their entirety by the cautionary statements included in this report. We undertake no obligations to update or revise forward-looking statements to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. In evaluating forward-looking statements, you should consider these risks and uncertainties.

Overview

We are a clinical-stage biopharmaceutical company focused on the development of Aramchol, a liver targeted stearoyl-coenzyme A desaturase-1, or SCD1, modulator, first in class, novel, oral therapy for the treatment of NASH for variable populations. In September 2019, we initiated our Phase 3/4 pivotal ARMOR Study to evaluate the efficacy and safety of Aramchol in subjects with NASH and fibrosis.

Financial Overview

To date, we have funded our operations primarily through proceeds from private placements and public offerings. At September 30, 2019, we had current assets of $80.6 million, which includes cash and cash equivalents of $18.3 million, short-term deposits of $20.4 million and marketable debt securities of $41.0 million. This compares with current assets of $90.4 million at December 31, 2018, which consisted of cash and cash equivalents of $24.2 million, short-term deposits of $6.1 million and marketable debt securities of $60.0 million. Although we provide no assurance, we believe that such existing funds will be sufficient to continue our business and operations as currently conducted for more than 12 months from the date of issuance of this Form 6-K. However, we will continue to incur operating losses, which may be substantial over the next several years, and we may need to obtain additional funds to further develop our research and development programs.

Revenues

We have entered into a license agreement with Samil Pharma. Co., Ltd., or the Samil Agreement, for the commercialization of Aramchol in Korea. Under the terms of the Samil Agreement, we have received upfront and milestone payments of $3.6 million, and may be eligible to receive up to approximately $4.5 million in additional payments for development and regulatory milestones for Aramchol in the licensed territories.

During 2018, when we determined that the achievement of our first milestone was probable, we included the variable consideration of $1.5 million as a part of the transaction price allocated to the combined performance obligation including the delivery of the license and completion of the ARREST study. We will re-evaluate the transaction price in each reporting period when events whose outcomes are resolved or other changes in circumstances occur that would indicate it is appropriate to recognize variable consideration as revenue.

Costs and Operating Expenses

Our current costs and operating expenses consist of two components: (i) research and development expenses; and (ii) general and administrative expenses.

Research and Development Expenses

Our research and development expenses consist primarily of outsourced development expenses, salaries and related personnel expenses and fees paid to external service providers, patent-related legal fees, costs of pre-clinical studies and clinical trials and drug and laboratory supplies. We account for all research and development expenses as they are incurred. We expect our research and development expense to remain our primary expense in the near future as we continue to develop Aramchol. Increases or decreases in research and development expenditures are primarily attributable to the number and/or duration of the pre-clinical and clinical studies that we conduct.

We expect that a substantial amount of our research and development expense in the future will be incurred in support of our current and anticipated pre-clinical and clinical development projects. Due to the inherently unpredictable nature of pre-clinical and clinical development studies, we are unable to estimate with any certainty the costs we will incur in the continued development of Aramchol for NASH and other indications in our pipeline for potential partnering and/or commercialization. Clinical development timelines, the probability of success and development costs can differ materially from expectations. We currently expect to continue testing Aramchol in pre-clinical studies for toxicology, safety and efficacy, and to conduct additional clinical trials for Aramchol.

While we are currently focused on advancing Aramchol's development, our future research and development expenses will depend on the clinical success of Aramchol, as well as ongoing assessments of Aramchol’s commercial potential. As we obtain results from clinical trials, we may elect to discontinue or delay clinical trials for our product candidate in certain indications in order to focus our resources on more promising indications for such product candidate. Completion of clinical trials may take several years or more, but the length of time generally varies according to the type, complexity, novelty and intended use of a product candidate.

We expect our research and development expenses to increase in the future from current levels as we continue to advance our clinical product development and, potentially, the in-licensing of additional product candidates.

The lengthy process of completing clinical trials and seeking regulatory approval for Aramchol requires the expenditure of substantial resources. Any failure or delay in completing clinical trials, or in obtaining regulatory approvals, could cause a delay in generating product revenue and cause our research and development expenses to increase and, in turn, have a material adverse effect on our operations. Because of the factors set forth above, we are not able to estimate with any certainty when we would recognize any net cash inflows from our projects. 

General and Administrative Expenses

General and administrative expenses consist primarily of compensation for employees in executive and operational roles, including finance/accounting, legal and other operating positions in connection with our activities. Our other significant general and administrative expenses include non-cash stock-based compensation costs and facilities costs (including the rental expense for our offices in Tel Aviv, Israel), professional fees for outside accounting and legal services, travel costs, investors relations, insurance premiums and depreciation. 

Financial Income, Net

Our financial income consists of interest income from marketable securities and our financial expense consists of fees associated with banking activities and losses from realization of marketable securities.

Results of Operations

The table below provides our results of operations for the three and nine months ended September 30, 2019 as compared to the three and nine months ended September 30, 2018.

Revenue

During the three and nine months ended September 30, 2019, we had no licensing revenue, as compared to approximately $1.5 million and $2.0 million respectively, for three and nine months ended September 30, 2018. The revenue in 2018 resulted from the recognition of the $1.5 million milestone payment received and the amortization of the up-front payments under the license agreement with Samil Pharm.

Research and Development Expenses

Our research and development expenses amounted to approximately $4.1 million and approximately $10.8 million during the three and nine months ended September 30, 2019, respectively, representing an increase of approximately $2.4 million, or 141%, and approximately $5.2 million, or 93%, respectively, compared to approximately $1.7 million and approximately $5.6 million for the comparable period in 2018.

The increase during the three and nine months ended September 30, 2019 primarily resulted from an increase in clinical and pre-clinical studies and drug development expenses in an amount of approximately $2.1 million and $4.0 million, respectively, related to continuing preparations of the ARMOR trial.

General and Administrative Expenses

Our general and administrative expenses amounted to approximately $1.0 million and approximately $2.9 million during the three and nine months ended September 30, 2019, respectively, representing a decrease of approximately $0.01 million, or 3%, and approximately $0.1 million, or 3%, respectively, compared to approximately $1.0 million and approximately $3.0 million for the comparable period in 2018.

Operating Loss

As a result of the foregoing, for the three and nine months ended September 30, 2019, our operating loss was approximately $5.0 million and approximately $13.7 million, respectively, representing an increase of $3.8 million, or 317%, and an increase of $7.2 million, or 111%, respectively, as compared to approximately $1.2 million and approximately $6.5 million for the comparable period in 2018.

Financial Income, Net

Our financial income, net amounted to approximately $0.5 million and approximately $1.6 million during the three and nine months ended September 30, 2019, respectively, compared to $0.3 million and $0.4 million for the comparable period in 2018.

The increase during the three and nine months ended September 30, 2019 primarily resulted from an increase in interest income from marketable debt securities and short-term deposits, as compared to such expenses for the comparable period in 2018.

Net Loss

As a result of the foregoing, for the three and nine months ended September 30, 2019 and 2018, our net loss was approximately $4.5 million and approximately $12.2 million, respectively, representing an increase of $3.5 million, or 350%, and an increase of $6.0 million, or 97%, respectively, as compared to approximately $1.0 million and approximately $6.2 million for the comparable period in 2018.

Liquidity and Capital Resources

To date, we have funded our operations primarily through proceeds from private placements and public offerings.  Under our existing “at the market” equity offering program, or the ATM offering, as of the date hereof, we may sell, from time to time, up to approximately $32.0 million of additional ordinary shares.

We have incurred substantial losses since our inception. As of September 30, 2019, we had an accumulated deficit of approximately $98.7 million and positive working capital (current assets less current liabilities) of approximately $77.0 million. We expect that operating losses will continue for the foreseeable future.

As of September 30, 2019, we had cash and cash equivalents of approximately $18.3 million, short-term deposits of approximately $20.4 million and marketable securities of approximately $41.0 million invested in accordance with our investment policy, totaling approximately $79.7 million, as compared to approximately $24.2 million, $6.1 million and $60.0 million as of December 31, 2018, totaling approximately $90.2 million. The decrease is mainly attributable to our $10.9 million negative cash flow from operations during the nine months ended September 30, 2019.

We had negative cash flow from operating activities of approximately $10.9 million for the nine months ended September 30, 2019, as compared to negative cash flow from operating activities of approximately $6.8 million for the nine months ended September 30, 2018. The negative cash flow from operating activities for the nine months ended September 30, 2019 is mainly attributable to our net loss of approximately $12.2 million, partially offset by non-cash stock-based compensation expenses of approximately $1.5 million.

We had positive cash flow from investing activities of approximately $4.9 million for the nine months ended September 30, 2019, as compared to negative cash flow from investing activities of approximately $60.3 million for the nine months ended September 30, 2018. The positive cash flow from investing activities for the nine months ended September 30, 2019 was primarily due to the net sale of marketable securities, partially offset by an investment in short-term deposits.

We had positive cash flow from financing activities of approximately $0.1 million for the nine months ended September 30, 2019, as compared to positive cash flow from financing activities of approximately $80.1 million for the nine months ended September 30, 2018. The positive cash flow from financing activities for the nine months ended September 30, 2019 was due to the proceeds from exercise of options.

Although there can be no assurance, we believe that our existing cash resources will be sufficient to fund our projected cash requirements for more than 12 months from the date of issuance of this Form 6-K.

Our future capital requirements will depend on many other factors, including: 

Until we can generate significant recurring revenues, we expect to satisfy our future cash needs through the net proceeds from equity financings (such as the ATM Offering) or by out-licensing applications of Aramchol. We cannot be certain that additional funding will be available to us on acceptable terms, if at all. If funds are not available, we may be required to delay, reduce the scope of or eliminate research or development plans for, or commercialization efforts with respect to, one or more applications of Aramchol. This may raise substantial doubts about the Company’s ability to continue as a going concern.

Trend Information

We are a development stage company, and it is not possible for us to predict with any degree of accuracy the outcome of our research, development or commercialization efforts. As such, it is not possible for us to predict with any degree of accuracy any significant trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on our net sales or revenues, income from continuing operations, profitability, liquidity or capital resources, or that would cause financial information to not necessarily be indicative of future operating results or financial condition. However, to the extent possible, certain trends, uncertainties, demands, commitments and events are in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.

Controls and Procedures

As a “foreign private issuer”, we are only required to conduct the evaluations required by Rules 13a-15(b) and 13a-15(d) of the Exchange Act as of the end of each fiscal year and therefore have elected not to provide disclosure regarding such evaluations at this time.

EXHIBIT INDEX

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.

Exhibit 99.1

Galmed Pharmaceuticals Provides Business Update and Reports Third Quarter 2019 Financial Results

- Conference Call and Webcast Today at 8:30 a.m. EST / 5:30 a.m. PST -

TEL AVIV, Israel, November 6, 2019 - Galmed Pharmaceuticals Ltd. (Nasdaq: GLMD) (“Galmed” or the “Company”), a clinical-stage biopharmaceutical company focused on the development of Aramchol, a liver targeted, oral SCD1 modulator currently in a Phase 3/4 clinical trial for the treatment of nonalcoholic steatohepatitis ("NASH") and fibrosis provides today a business update and reports financial results for the three and nine months ended September 30, 2019. The Company will host a conference call and webcast at 08:30 ET today.

Business Development

During the past quarter, the Company announced the initiation of its Phase 3/4 ARMOR, a double-blind, placebo-controlled, global study, to evaluate the efficacy and safety of Aramchol in subjects with NASH and fibrosis. The study is designed to consist of two parts. In the first part (Histology-Based) 1200 subjects will be treated with Aramchol or matching placebo for 52 weeks. The Histology-Based data will serve as the basis for the submission of a marketing authorization application under regulatory provisions of accelerated/conditional approval. In the second part (clinically-based), all subjects will continue with the same treatment assignment until study completion to confirm clinical efficacy.

The ARMOR study will be conducted in approximately 185 sites in the U.S., Europe, Latin America and Asia and the Company aims to complete enrollment by the second quarter of 2021 and report top-line results by the fourth quarter of 2022.

Financial Summary - Third Quarter 2019 vs. Third Quarter 2018:

Conference Call & Webcast:

Wednesday, November 6^th @ 8:30am Eastern Time.

Replay Dial-In Numbers

About Aramchol and Non-alcoholic Steatohepatitis (NASH)

Aramchol (arachidyl amido cholanoic acid) is a novel fatty acid bile acid conjugate, inducing beneficial modulation of intra-hepatic lipid metabolism. Aramchol's ability to modulate hepatic lipid metabolism was discovered and validated in animal models, demonstrating downregulation of the three key pathologies of NASH: steatosis, inflammation and fibrosis. The effect of Aramchol on fibrosis is mediated by downregulation of steatosis and directly on human collagen producing cells. Aramchol has been granted Fast Track designation status by the FDA for the treatment of NASH.

NASH is an emerging world crisis impacting an estimated 3% to 5% of the U.S. population and an estimated 2% to 4% globally. It is the fastest growing cause of liver cancer and liver transplant in the U.S. due to the rise in obesity. NASH is the progressive form of non-alcoholic fatty liver disease that can lead to cardiovascular disease, cirrhosis and liver-related mortality.

About Galmed Pharmaceuticals Ltd.

Galmed Pharmaceuticals Ltd. is a clinical stage drug development biopharmaceutical company for liver, metabolic and inflammatory diseases. Our lead compound, Aramchol™, a backbone drug candidate for the treatment of NASH and fibrosis is currently in a Phase 3/4 registrational study.

Forward-Looking Statements:

This press release may include forward-looking statements. Forward-looking statements may include, but are not limited to, statements relating to Galmed's objectives, plans and strategies, as well as statements, other than historical facts, that address activities, events or developments that Galmed intends, expects, projects, believes or anticipates will or may occur in the future. These statements are often characterized by terminology such as "believes," "hopes," "may," "anticipates," "should," "intends," "plans," "will," "expects," "estimates," "projects," "positioned," "strategy" and similar expressions and are based on assumptions and assessments made in light of management's experience and perception of historical trends, current conditions, expected future developments and other factors believed to be appropriate. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statements. Many factors could cause Galmed's actual activities or results to differ materially from the activities and results anticipated in forward-looking statements, including, but not limited to, the following: the timing and cost of Galmed's planned pivotal Phase 3/4 ARMOR trial, or the ARMOR Study; completion and receiving favorable results of the ARMOR Study for Aramchol or any other pre-clinical or clinical trial; regulatory action with respect to Aramchol by the FDA or the EMA; the commercial launch and future sales of Aramchol or any other future products or product candidates; Galmed's ability to comply with all applicable post-market regulatory requirements for Aramchol in the countries in which it seeks to market the product; Galmed's ability to achieve favorable pricing for Aramchol; Galmed's expectations regarding the commercial market for NASH patients; third-party payor reimbursement for Aramchol; Galmed's estimates regarding anticipated capital requirements and Galmed's needs for additional financing; market adoption of Aramchol by physicians and patients; the timing, cost or other aspects of the commercial launch of Aramchol; the development and approval of the use of Aramchol for additional indications or in combination therapy; and Galmed's expectations regarding licensing, acquisitions and strategic operations. More detailed information about the risks and uncertainties affecting Galmed is contained under the heading "Risk Factors" included in Galmed's most recent Annual Report on Form 20-F filed with the SEC on March 13, 2019, and in other filings that Galmed has made and may make with the SEC in the future. The forward-looking statements contained in this press release are made as of the date of this press release and reflect Galmed's current views with respect to future events, and Galmed does not undertake and specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.  

CONTACT:

Guy Nehemya, Chief Operating Officer

Galmed Pharmaceuticals Ltd.

Guy@galmedpharma.com

GALMED PHARMACEUTICALS LTD.

Consolidated Balance Sheets

U.S. Dollars in thousands, except share data and per share data

GALMED PHARMACEUTICALS LTD.

Consolidated Statements of Operations (Unaudited)

U.S. Dollars in thousands, except share data and per share data

GALMED PHARMACEUTICALS LTD.

Consolidated Statements of Cash Flows (Unaudited)

U.S. Dollars in thousands