Neos Therapeutics Reports First Quarter 2020 Financial Results
11 Maggio 2020 - 10:01PM
Neos Therapeutics, Inc. (Nasdaq: NEOS), a commercial-stage
pharmaceutical company developing and manufacturing central nervous
system-focused products, today reported financial results for the
first quarter ended March 31, 2020 and announced that it is
reducing its cost structure by decreasing its workforce by
approximately 25 percent.
“Since late 2018, we have been steadfast in
taking action to better position Neos for long-term profitability
and growth. Today, we have made the difficult but necessary
decision to reduce headcount across the organization to streamline
costs and further strengthen our long-term outlook as we adjust to
a rapidly changing economic environment and the recent impact on
our business as a result of the COVID-19 pandemic. We believe this
decision will ensure and accelerate our path to profitability,
enable further investment in our pipeline candidate, NT0502, for
the treatment of sialorrhea and strengthen our ability to acquire
on-market product opportunities to leverage our commercial
organization. We acknowledge this decision impacts many talented
employees, and I would like to personally thank them for their
contributions to Neos and their dedication to the patients we
serve,” said Jerry McLaughlin, President and Chief Executive
Officer.
The reduction in force announced today, affects
approximately 50 employees, or 25 percent of the Company’s
workforce. Following these changes, the Company will have
approximately 45 (of the previous 75) sales territories, which
represent approximately 80 percent of its current prescriber base
for its Attention Deficit Hyperactivity Disorder (ADHD) business.
The Company plans to deploy alternative sales and marketing efforts
toward many of the remaining 20 percent of current prescribers.
ADHD Commercial Franchise
- Increased net revenue per
pack by over 21 percent year-over-year: Neos reported
growth in net revenue per pack for its two core commercial ADHD
products, Adzenys XR-ODT® and Cotempla XR-ODT®, for the three
months ended March 31, 2020 compared to the same period in 2019.
Blended net revenue per pack for the first quarter of 2020 was $128
compared to $106 for the first quarter of 2019, an increase of
nearly 21 percent. These results reflect the continued execution of
the Company’s strategic shift in its ADHD business towards more
profitable business channels and market segments.
- Neos RxConnect patient
support program continued to expand and is expected to reach 1,000
participating pharmacies in 2Q 2020: During the first
quarter of 2020, the Company continued to substantially expand the
number of participating pharmacies in the Neos RxConnect network.
As of May 1, 2020, the network included approximately 800
pharmacies, compared to approximately 500 as of the end of 2019. In
addition, the Company has come to an agreement with another large,
regional grocery store chain that will increase the number of
participating pharmacies to greater than 1,000 by the end of the
second quarter of 2020. The Company believes the Neos RxConnect
patient support program will continue to play an increasingly
important role in the growth of the Company’s ADHD business by
providing affordable and predicable access to Neos ADHD medications
to patients while eliminating many of the hassles that deter health
care providers from prescribing medications that they consider most
appropriate for their patients.
Development Pipeline
- Announced issuance of new
U.S. Methods of Use Patent for N-desethyloxybutynin: The
Company announced in April 2020 that the United States Patent and
Trademark Office (USPTO) issued U.S. Patent No. 10,610,507, which
is directed to methods of treating sialorrhea by administering
N-desethyloxybutynin, the active pharmaceutical ingredient in
NT0502. NT0502 is currently in clinical development for the
treatment of sialorrhea in patients with neurological conditions.
The patent, licensed to Neos Therapeutics, is not expected to
expire before November 2032.
- NT0502 Phase 1 single ascending and multiple ascending
dose trial to begin in second half of 2020: The Company
plans to initiate a Phase 1 clinical trial for NT0502, for the
treatment of sialorrhea in patients with neurological conditions,
in the second half of 2020. The multi-part study will include
single ascending and multiple ascending dose cohorts.
Financial Highlights and Select First
Quarter 2020 Financial Results
- For the first quarter of 2020, net
loss was $8.0 million, compared to $7.6 million in the first
quarter of 2019.
- Total product revenues were $14.5
million for the three months ended March 31, 2020, compared to
$14.6 million for the same period in 2019.
|
Q1 2020 |
Q1 2019 |
Adzenys XR-ODT |
$4.2MM |
$6.7MM |
Cotempla XR-ODT |
$8.1MM |
$5.8MM |
Adzenys ER |
$0.2MM |
$0.1MM |
Generic Tussionex |
$2.0MM |
$2.0MM |
Total |
$14.5MM |
$14.6MM |
- Gross profit was $8.1 million for
the three months ended March 31, 2020, compared to a gross profit
of $8.2 million for the same period in 2019.
- Research and development expenses
were $2.0 million for the three months ended March 31, 2020,
compared to $3.2 million for the same period in 2019.
- Selling and marketing expenses were
$7.6 million for the three months ended March 31, 2020, compared to
$7.1 million for the same period in 2019.
- General and administrative expenses
were $4.4 million for the three months ended March 31, 2020,
compared to $3.8 million for the same period in 2019.
- At March 31, 2020, the Company held
$31.9 million in cash and cash equivalents and short-term
investments.
- On May 6, 2020 the Company
announced that it had amended its debt facility with Deerfield to
defer $5.0 million of the $15.0 million of principal due to
Deerfield on May 11, 2020. The Company will instead pay the
$5.0 million over eight equal monthly installments beginning on
September 11, 2020 and ending on April 11, 2021.
Conference Call Details Neos
management will host a conference call and live audio webcast to
discuss these results and provide a company update at 5:00 p.m. EDT
today. The live call may be accessed by dialing (877) 388-8985 for
domestic calls, or +1 (562) 912-2654 for international callers, and
referencing conference ID number 1099917. A live audio webcast for
the conference call will be available on the Investor Relations
page of the Company’s website at http://investors.neostx.com/.
Following the conclusion of the call, the webcast will be available
for replay for 30 days.
About Neos TherapeuticsNeos
Therapeutics, Inc. (NASDAQ: NEOS) is a commercial-stage
pharmaceutical company developing and manufacturing central nervous
system (CNS)-focused products. The Company markets Adzenys
XR-ODT® (amphetamine) extended-release orally disintegrating
tablets (see Full Prescribing Information,
including Boxed WARNING), Cotempla XR-ODT® (methylphenidate)
extended-release orally disintegrating tablets
(see Full Prescribing Information, including
Boxed WARNING), and Adzenys-ER® (amphetamine) extended-release
oral suspension (see Full Prescribing
Information, including Boxed WARNING), all for the
treatment of ADHD. The Company also has a development candidate,
NT0502, for the treatment of sialorrhea in patients with
neurological conditions. Additional information about Neos is
available at www.neostx.com.
Forward-Looking Statements Any
statements in this press release about future expectations, plans
and prospects for the Company, including statements about the
Company’s strategy, future operations, commercial products,
clinical development of its therapeutic candidates, plans for
potential future product candidates, financial condition and
outlook, and other statements containing the words “anticipate,”
“believe,” “estimate,” “expect,” “intend,” “may,” “plan,”
“predict,” “project,” “suggest,” “target,” “potential,” “will,”
“would,” “could,” “should,” “continue,” and similar expressions,
constitute forward-looking statements within the meaning of The
Private Securities Litigation Reform Act of 1995. Actual results
may differ materially from those indicated by such forward-looking
statements as a result of various important factors, including: the
impact of COVID-19 on prescriptions for the Company’s products and
on the Company’s business, revenues, results of operations and
financial condition, the net sales, profitability, and growth of
the Company’s commercial products, the Company’s future expansion
of the Neos RxConnect network; the status, timing, costs, results
and interpretation of the Company’s clinical trials or any future
trials, including whether the Company will initiate a Phase 1
ascending dose study of NT0502 in the second half of 2020; the
uncertainties inherent in conducting clinical trials; expectations
for regulatory interactions, submissions and approvals; the
financial condition and outlook for the Company, including whether
the Company will continue to make progress towards its goal of
achieving operational profitability; availability of funding
sufficient for the Company’s foreseeable and unforeseeable
operating expenses and capital expenditure requirements;
uncertainties related to the Company’s intellectual property,
including the expected expiration of the methods of use patent for
N-desethyloxybutynin; other matters that could affect the
availability or commercial potential of the Company’s commercial
products or therapeutic candidates; and other factors discussed in
the Risk Factors set forth in the Company’s Annual Report on Form
10-K and Quarterly Reports on Form 10-Q filed with the Securities
and Exchange Commission (SEC) and in other filings the Company
makes with the SEC from time to time. In addition, the
forward-looking statements included in this press release represent
the Company’s views only as of the date hereof. The Company
anticipates that subsequent events and developments may cause the
Company’s views to change. However, while the Company may elect to
update these forward-looking statements at some point in the
future, it specifically disclaims any obligation to do so, except
as may be required by law.
Neos Therapeutics, Inc. and
SubsidiariesCONDENSED CONSOLIDATED BALANCE SHEETS(In
thousands, except share and per share data)(unaudited)
|
March 31, |
|
December 31, |
|
2020 |
|
2019 |
ASSETS |
|
|
|
|
|
Current Assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
27,858 |
|
|
$ |
16,830 |
|
Short-term investments |
|
3,992 |
|
|
|
8,064 |
|
Accounts receivable, net of allowances for chargebacks and cash
discounts of $3,295 and $4,848 at March 31, 2020 and December 31,
2019, respectively |
|
20,782 |
|
|
|
26,563 |
|
Inventories, net |
|
10,218 |
|
|
|
11,010 |
|
Prepaid expenses and other current assets |
|
2,904 |
|
|
|
4,092 |
|
Total current assets |
|
65,754 |
|
|
|
66,559 |
|
|
|
|
|
|
|
Property and equipment,
net |
|
7,014 |
|
|
|
7,345 |
|
Operating lease right-of-use
assets |
|
2,920 |
|
|
|
3,044 |
|
Intangible assets, net |
|
12,139 |
|
|
|
12,543 |
|
Other assets |
|
1,266 |
|
|
|
1,382 |
|
Total assets |
$ |
89,093 |
|
|
$ |
90,873 |
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' DEFICIT |
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities: |
|
|
|
|
|
Accounts payable |
$ |
13,033 |
|
|
$ |
6,650 |
|
Accrued expenses |
|
30,556 |
|
|
|
40,188 |
|
Current portion of operating lease liabilities |
|
707 |
|
|
|
681 |
|
Short-term line of credit |
|
8,569 |
|
|
|
— |
|
Current portion of long-term debt |
|
15,534 |
|
|
|
15,836 |
|
Total current liabilities |
|
68,399 |
|
|
|
63,355 |
|
|
|
|
|
|
|
Long-Term Liabilities: |
|
|
|
|
|
Long-term debt, net of current portion |
|
29,422 |
|
|
|
29,099 |
|
Operating lease liabilities |
|
3,067 |
|
|
|
3,254 |
|
Derivative liability |
|
1,231 |
|
|
|
1,135 |
|
Other long-term liabilities |
|
154 |
|
|
|
160 |
|
Total long-term liabilities |
|
33,874 |
|
|
|
33,648 |
|
|
|
|
|
|
|
Stockholders' (Deficit)
Equity: |
|
|
|
|
|
Preferred stock, $0.001 par
value, 5,000,000 shares authorized, no shares issued or outstanding
at March 31, 2020 and December 31, 2019 |
|
— |
|
|
|
— |
|
Common stock, $0.001 par
value, 100,000,000 shares authorized at March 31, 2020
and December 31, 2019; 49,777,756 and 49,743,955 shares
issued and outstanding, respectively, at March 31, 2020;
49,766,472 and 49,732,671 shares issued and outstanding,
respectively, at December 31, 2019 |
|
50 |
|
|
|
50 |
|
Treasury stock, at cost,
33,801 shares at March 31, 2020 and
December 31, 2019 |
|
(352 |
) |
|
|
(352 |
) |
Additional paid-in capital |
|
328,956 |
|
|
|
328,056 |
|
Accumulated deficit |
|
(341,835 |
) |
|
|
(333,885 |
) |
Accumulated other comprehensive income |
|
1 |
|
|
|
1 |
|
Total stockholders' deficit |
|
(13,180 |
) |
|
|
(6,130 |
) |
Total liabilities and stockholders' deficit |
$ |
89,093 |
|
|
$ |
90,873 |
|
Neos Therapeutics, Inc. and
SubsidiariesCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(In thousands, except share and per share
data)(unaudited)
|
Three Months Ended |
|
March 31, |
|
2020 |
|
2019 |
Revenues: |
|
|
|
|
|
Net product sales |
$ |
14,493 |
|
|
$ |
14,634 |
|
|
|
|
|
|
|
Cost of goods sold |
|
6,389 |
|
|
|
6,396 |
|
Gross profit |
|
8,104 |
|
|
|
8,238 |
|
|
|
|
|
|
|
Research and development
expenses |
|
2,035 |
|
|
|
3,197 |
|
Selling and marketing
expenses |
|
7,592 |
|
|
|
7,069 |
|
General and administrative
expenses |
|
4,365 |
|
|
|
3,793 |
|
|
|
|
|
|
|
Loss from operations |
|
(5,888 |
) |
|
|
(5,821 |
) |
|
|
|
|
|
|
Interest expense |
|
(2,037 |
) |
|
|
(2,115 |
) |
Other (expense) income,
net |
|
(25 |
) |
|
|
336 |
|
|
|
|
|
|
|
Net loss |
$ |
(7,950 |
) |
|
$ |
(7,600 |
) |
|
|
|
|
|
|
Weighted average common shares
outstanding used to compute net loss per share, basic and
diluted |
|
49,736,125 |
|
|
|
49,703,563 |
|
|
|
|
|
|
|
Net loss per share of
common stock, basic and diluted |
$ |
(0.16 |
) |
|
$ |
(0.15 |
) |
Contacts:
Richard EisenstadtChief Financial OfficerNeos Therapeutics(972)
408‑1389reisenstadt@neostx.com
Sarah McCabeStern Investor Relations, Inc.(212)
362‑1200sarah.mccabe@sternir.com
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