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Cumberland Pharmaceuticals Reports Third Quarter & Year To Date 2016 Financial Results
As of
QUARTER HIGHLIGHTS:
- Launched Ethyol®, an
FDA approved cytoprotective drug and Cumberland's first oncology product, inthe United States . - Initiated a fourth ifetroban clinical program, with
FDA clearance for an IND - to develop Portaban™ for the treatment of portal hypertension. - Welcomed
Caroline Young , former president of theNashville Health Care Council , to the Company's Board of Directors.
"We have been busy putting the pieces in place to build our sales momentum while expanding our clinical pipeline and maintaining a strong financial position," said
RECENT DEVELOPMENTS:
Ethyol®
Cumberland launched Ethyol® (amifostine) for Injection in
This is the first product to be licensed by Cumberland from Clinigen Group plc under the
Portaban™
Cumberland announced its fourth clinical development program for ifetroban to develop Portaban™, an oral form of ifetroban, for the treatment of portal hypertension associated with liver disease. Portal hypertension, a complication of liver cirrhosis, is an increase in the blood pressure within the portal venous system. This increased pressure in the portal veins may lead to the development of large, swollen veins which can rupture and bleed, resulting in potentially life-threatening complications. Preclinical studies have shown that ifetroban can reduce portal pressure, inflammation, and fibrosis in multiple models of liver injury.
The
FINANCIAL RESULTS:
Net Revenue: For the three months ended
For the nine months ended
Operating Expenses: Total operating expenses for the three months ended
Earnings: Net income for the third quarter of 2016 was
Balance Sheet: At
Conference Call and Webcast
A conference call and live
About
Cumberland is developing Hepatoren® (ifetroban) Injection for the treatment of Hepatorenal Syndrome, Boxaban® (ifetroban) Oral Capsule for the treatment of Aspirin-Exacerbated Respiratory Disease, Vasculan™ (ifetroban) Oral Capsule for the treatment of systemic sclerosis, and Portaban™, for the treatment of portal hypertension.
Cumberland is dedicated to providing innovative products that improve quality of care for patients. For more information on Cumberland's approved products, including full prescribing information, please visit the individual product websites, links to which can be found on the Company's website www.cumberlandpharma.com.
About Acetadote® (acetylcysteine) Injection
Acetadote, administered intravenously within 8 to 10 hours after ingestion of a potentially hepatotoxic quantity of acetaminophen, is indicated to prevent or lessen hepatic injury. Used in the emergency department, Acetadote is approved in
About Caldolor® (ibuprofen) Injection
Caldolor is indicated in adults and pediatric patients for the management of mild to moderate pain and management of moderate to severe pain as an adjunct to opioid analgesics, as well as the reduction of fever. It was the first
About Kristalose® (lactulose) Oral Solution
Kristalose is indicated for the treatment of acute and chronic constipation. It is a unique, proprietary, crystalline form of lactulose, with no restrictions on length of therapy or patient age. Initial dosing may produce flatulence and intestinal cramps, which are usually transient. Excessive dosage can lead to diarrhea with potential complications such as loss of fluids, hypokalemia, and hypernatremia. Nausea and vomiting have been reported. Use with caution in diabetics. Kristalose is contraindicated in patients who require a low-galactose diet. Elderly, debilitated patients who receive lactulose for more than six months should have serum electrolytes (potassium, chloride, carbon dioxide) measured periodically. For full prescribing information, visit www.kristalose.com.
About Omeclamox®-Pak (omeprazole, clarithromycin, amoxicillin)
Omeprazole is an antisecretory drug, which works by decreasing the amount of acid the stomach produces. Clarithromycin and amoxicillin are antibacterial drugs, which inhibit the growth of bacteria allowing the stomach lining to heal. Omeclamox-Pak is contraindicated in patients with a history of hypersensitivity to omeprazole, any macrolide antibiotic or penicillin. The safety and effectiveness of Omeclamox-Pak in the pediatric population has not yet been established. Omeclamox-Pak was approved by the
About Vaprisol® (conivaptan hydrochloride) Injection
Vaprisol is an intravenous treatment for hyponatremia used in the critical care setting. Hyponatremia is an electrolyte disturbance in which sodium ion concentration in blood plasma is lower than normal. This can be associated with a variety of critical care conditions including congestive heart failure, liver failure, kidney failure and pneumonia.
The product is a vasopressin receptor antagonist that raises serum sodium levels and promotes free water secretion. Vaprisol was approved by the
About Ethyol® (amifostine) Injection
Ethyol is indicated to reduce the cumulative renal toxicity associated with repeated administration of cisplatin in patients with advanced ovarian cancer. It is indicated to reduce the incidence of moderate to severe xerostomia in patients undergoing post-operative radiation treatment for head and neck cancer, where the radiation port includes a substantial portion of the parotid glands.
About Cumberland Emerging Technologies (CET)
Forward-Looking Statements
This announcement contains forward-looking statements, which are subject to certain risks and reflect Cumberland's current views on future events based on what it believes are reasonable assumptions. No assurance can be given that these events will occur. As with any business, all phases of Cumberland's operations are subject to factors outside of its control, and any one or combination of these factors could materially affect Cumberland's results of operations.
These factors include market conditions, competition, an inability of manufacturers to produce Cumberland's products on a timely basis or failure of manufacturers to comply with regulations applicable to pharmaceutical manufacturers, maintaining an effective sales and marketing infrastructure and other factors discussed in the Company's most recent Form 10-K and subsequent 10-Q's as filed with the
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
|
| ||||||
ASSETS |
|||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
35,546,244 |
$ |
38,203,059 |
|||
Marketable securities |
14,600,404 |
14,564,115 |
|||||
Accounts receivable, net of allowances |
6,672,300 |
6,077,120 |
|||||
Inventories |
4,983,227 |
4,270,143 |
|||||
Other current assets |
5,160,817 |
3,997,637 |
|||||
Total current assets |
66,962,992 |
67,112,074 |
|||||
Property and equipment, net |
482,591 |
536,450 |
|||||
Intangible assets, net |
21,172,570 |
21,168,596 |
|||||
Other assets |
2,456,118 |
3,101,839 |
|||||
Total assets |
$ |
91,074,271 |
$ |
91,918,959 |
|||
LIABILITIES AND EQUITY |
|||||||
Current liabilities: |
|||||||
Accounts payable |
$ |
6,658,196 |
$ |
2,877,479 |
|||
Other current liabilities |
5,027,735 |
9,534,268 |
|||||
Total current liabilities |
11,685,931 |
12,411,747 |
|||||
Revolving line of credit |
3,700,000 |
1,700,000 |
|||||
Other long-term liabilities |
1,265,725 |
987,429 |
|||||
Total liabilities |
16,651,656 |
15,099,176 |
|||||
Commitments and contingencies |
|||||||
Equity: |
|||||||
Shareholders' equity: |
|||||||
Common stock—no par value; 100,000,000 shares authorized; 16,195,631 and 16,379,501 shares issued and outstanding as of |
55,175,133 |
57,338,294 |
|||||
Retained earnings |
19,354,625 |
19,549,614 |
|||||
Total shareholders' equity |
74,529,758 |
76,887,908 |
|||||
Noncontrolling interests |
(107,143) |
(68,125) |
|||||
Total equity |
74,422,615 |
76,819,783 |
|||||
Total liabilities and equity |
$ |
91,074,271 |
$ |
91,918,959 |
Condensed Consolidated Statements of Operations and Comprehensive Income (loss) (Unaudited) | |||||||||||||||
Three months ended |
Nine months ended | ||||||||||||||
2016 |
2015 |
2016 |
2015 | ||||||||||||
Net revenues |
$ |
8,791,753 |
$ |
7,885,048 |
$ |
23,944,120 |
$ |
25,481,563 |
|||||||
Costs and expenses: |
|||||||||||||||
Cost of products sold |
1,973,948 |
980,176 |
4,353,148 |
3,379,018 |
|||||||||||
Selling and marketing |
3,614,714 |
3,608,828 |
10,585,955 |
10,645,229 |
|||||||||||
Research and development |
644,662 |
757,442 |
2,029,914 |
3,444,524 |
|||||||||||
General and administrative |
1,865,575 |
1,794,279 |
5,817,943 |
5,591,982 |
|||||||||||
Amortization |
562,722 |
473,439 |
1,632,920 |
1,471,879 |
|||||||||||
Total costs and expenses |
8,661,621 |
7,614,164 |
24,419,880 |
24,532,632 |
|||||||||||
Operating income (loss) |
130,132 |
270,884 |
(475,760) |
948,931 |
|||||||||||
Interest income |
51,636 |
64,072 |
160,248 |
178,320 |
|||||||||||
Interest expense |
(29,088) |
(19,815) |
(77,777) |
(53,854) |
|||||||||||
Income (loss) before income taxes |
152,680 |
315,141 |
(393,289) |
1,073,397 |
|||||||||||
Income tax (expense) benefit |
(57,192) |
(193,439) |
159,282 |
(530,885) |
|||||||||||
Net income (loss) |
95,488 |
121,702 |
(234,007) |
542,512 |
|||||||||||
Net loss at subsidiary attributable to noncontrolling interests |
10,678 |
4,911 |
39,018 |
37,780 |
|||||||||||
Net income (loss) attributable to common shareholders |
$ |
106,166 |
$ |
126,613 |
$ |
(194,989) |
$ |
580,292 |
|||||||
Earnings (loss) per share attributable to common shareholders |
|||||||||||||||
- basic |
$ |
0.01 |
$ |
0.01 |
$ |
(0.01) |
$ |
0.03 |
|||||||
- diluted |
$ |
0.01 |
$ |
0.01 |
$ |
(0.01) |
$ |
0.03 |
|||||||
Weighted-average shares outstanding |
|||||||||||||||
- basic |
16,217,442 |
16,604,682 |
16,268,579 |
16,811,360 |
|||||||||||
- diluted |
16,504,568 |
16,996,376 |
16,268,579 |
17,193,854 |
|||||||||||
Comprehensive income (loss) attributable to common shareholders |
106,166 |
126,613 |
$ |
(194,989) |
$ |
580,292 |
|||||||||
Net loss at subsidiary attributable to noncontrolling interests |
10,678 |
4,911 |
39,018 |
37,780 |
|||||||||||
Total comprehensive income (loss) |
$ |
95,488 |
$ |
121,702 |
$ |
(234,007) |
$ |
542,512 |
|||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) | |||||||
Nine months ended | |||||||
2016 |
2015 | ||||||
Cash flows from operating activities: |
|||||||
Net income (loss) |
$ |
(234,007) |
$ |
542,512 |
|||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
|||||||
Depreciation and amortization expense |
1,785,057 |
1,677,906 |
|||||
Deferred tax benefit |
662,689 |
43,991 |
|||||
Share-based compensation |
623,504 |
426,651 |
|||||
Excess tax expense (benefit) derived from exercise of stock options |
907,270 |
(470,584) |
|||||
Noncash interest expense |
61,224 |
33,001 |
|||||
Noncash investment gains |
(69,140) |
(80,321) |
|||||
Net changes in assets and liabilities affecting operating activities: |
|||||||
Accounts receivable |
(595,180) |
(293,665) |
|||||
Inventory |
(713,084) |
1,394,280 |
|||||
Other current assets and other assets |
(1,241,372) |
(239,484) |
|||||
Accounts payable and other current liabilities |
(1,705,007) |
1,457,656 |
|||||
Other long-term liabilities |
267,730 |
61,553 |
|||||
Net cash (used in) provided by operating activities |
(250,316) |
4,553,496 |
|||||
Cash flows from investing activities: |
|||||||
Additions to property and equipment |
(98,275) |
(96,768) |
|||||
Purchases of marketable securities |
(3,643,894) |
(5,201,240) |
|||||
Proceeds from sale of marketable securities |
3,676,745 |
5,684,149 |
|||||
Additions to intangible assets |
(1,554,410) |
(2,392,477) |
|||||
Net cash used in investing activities |
(1,619,834) |
(2,006,336) |
|||||
Cash flows from financing activities: |
|||||||
Net borrowings on line of credit |
2,000,000 |
1,700,000 |
|||||
Exercise of stock options |
— |
21,366 |
|||||
Excess tax (expense) benefit derived from exercise of stock options |
(907,270) |
470,584 |
|||||
Cash settlement of contingent consideration |
— |
(1,618,983) |
|||||
Repurchase of common shares |
(1,879,395) |
(4,669,873) |
|||||
Net cash used in financing activities |
(786,665) |
(4,096,906) |
|||||
Net decrease in cash and cash equivalents |
(2,656,815) |
(1,549,746) |
|||||
Cash and cash equivalents at beginning of period |
38,203,059 |
39,866,037 |
|||||
Cash and cash equivalents at end of period |
$ |
35,546,244 |
$ |
38,316,291 |
Reconciliation of Net Income (Loss) Attributable to Common Shareholders to Adjusted Earnings and Adjusted Diluted Earnings Per Share (Unaudited) | ||||||||||||||||
Three months ended |
Three months ended | |||||||||||||||
Earnings impact |
Earnings per share impact |
Earnings impact |
Earnings per share impact | |||||||||||||
Net income attributable to common shareholders |
$ |
106,166 |
$ |
0.01 |
$ |
126,613 |
$ |
0.01 |
||||||||
Less: Net loss at subsidiary attributable to noncontrolling interests |
10,678 |
— |
4,911 |
— |
||||||||||||
Net income |
95,488 |
0.01 |
121,702 |
0.01 |
||||||||||||
Adjustments to net income |
||||||||||||||||
Income tax expense |
57,192 |
— |
193,439 |
0.01 |
||||||||||||
Depreciation and amortization expense |
613,620 |
0.04 |
534,904 |
0.03 |
||||||||||||
Share-based compensation (a) |
215,278 |
0.01 |
(122,952) |
(0.01) |
||||||||||||
Interest income |
(51,636) |
— |
(64,072) |
— |
||||||||||||
Interest expense |
29,088 |
— |
19,815 |
— |
||||||||||||
Adjusted Earnings and Adjusted Diluted Earnings Per Share |
$ |
959,030 |
$ |
0.06 |
$ |
682,836 |
$ |
0.04 |
||||||||
Diluted weighted-average common shares outstanding: |
16,504,568 |
16,996,376 |
The Company provided the above adjusted supplemental financial performance measures, which are considered "non-GAAP" financial measures under applicable
Because these supplemental financial measures exclude the effect of items that will increase or decrease the Company's reported results of operations, management strongly encourages investors to review the Company's consolidated financial statements and publicly filed reports in their entirety. A reconciliation of the supplemental financial measures to the most directly comparable GAAP financial measures is included in the tables accompanying this release.
Cumberland's management believes these supplemental financial performance measures are important as they are used by management, along with financial measures in accordance with GAAP, to evaluate the Company's operating performance. In addition, Cumberland believes that they will be used by certain investors to measure the Company's operating results. Management believes that presenting these supplemental measures provides useful information about the Company's underlying performance across reporting periods on a consistent basis by excluding items that Cumberland does not believe are indicative of its core business performance or reflect long-term strategic activities. Certain of these items are not settled through cash payments and include: depreciation, amortization, share-based compensation expense and income taxes. Cumberland utilizes its net operating loss carryforwards to pay minimal income taxes. In addition, the use of these financial measures provides greater transparency to investors of supplemental information used by management in its financial and operational decision-making, including the evaluation of the Company's operating performance.
The Company defines these supplemental financial measures as follows:
- Adjusted Earnings: net income adjusted for the impact of income taxes, depreciation and amortization expense, share-based compensation expense and other income and interest expense.
(a) Represents the share-based compensation of Cumberland.
(b) Represents Cumberland's fee paid to theFDA in connection with a request for expanded pediatric labeling for Caldolor.
(c) Represents Cumberland's reduction in contingent liabilities as the result of a reduction in the cost of the Vaprisol acquisition.
- Adjusted Diluted Earnings Per Share: Adjusted Earnings divided by diluted weighted-average common shares outstanding.
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