ANI Pharmaceuticals Reports First Quarter 2022 Results; Provides Purified Cortrophin® Gel Net Revenue Guidance and Full-Year 2022 Total Company Net Revenue Guidance of $295 Million to $315 Million
ANI Pharmaceuticals reported first quarter 2022 net revenues of $64.5 million, a 17.6% increase from Q1 2021. However, the company faced a net loss of $(20.1) million, equating to a diluted GAAP loss per share of $(1.27). Adjusted non-GAAP EBITDA was $4.3 million. The company provided revenue guidance for Cortrophin Gel of $35 million to $40 million and total net revenue guidance of $295 million to $315 million for 2022. Strong physician demand for Cortrophin Gel has resulted in over 250 new cases initiated. ANI's ongoing R&D efforts led to several new product launches and six new ANDA applications.
- Net revenues increased 17.6% to $64.5 million compared to Q1 2021.
- Cortrophin Gel revenue guidance set at $35 million to $40 million for 2022.
- Over 250 new patient cases for Cortrophin Gel initiated since launch.
- Successful launch of several new products with an estimated annualized sales of approximately $240 million.
- Retention of leadership position in Competitive Generic Therapies with six new ANDA filings.
- Net loss of $(20.1) million in Q1 2022 compared to a net income of $0.1 million in Q1 2021.
- Adjusted non-GAAP EBITDA decreased to $4.3 million from $18.9 million in Q1 2021.
- Significant increase in operating expenses by 63% to $83.7 million, affecting profitability.
-- First quarter net revenues of
-- First quarter adjusted non-GAAP EBITDA of
-- Provides Purified Cortrophin® Gel (Cortrophin Gel) 2022 Net Revenue guidance of
-- Strong physician demand for Cortrophin Gel resulting in over 250 new cases initiated from more than 125 unique prescribers coupled with expanded market access leading to over 100 million lives covered on formulary --
-- With robust R&D engine in place, launched several new products, including Misoprostol Tablets, Rifabutin Capsules, and Bisoprolol Tablets; filed six new ANDA applications; retained position as market leader in Competitive Generic Therapies --
-- Appointed
“During the first quarter, we launched Cortrophin Gel, the lead asset in our Rare Disease business, and can now offer patients suffering from certain chronic autoimmune conditions a choice in ACTH therapy. We are pleased with the increasing trajectory of patients enrolled and the strong execution of our commercial team. Driven by the Cortrophin Gel launch, we are increasing our full-year net revenue guidance and continuing to invest to bring this therapy to patients in need,” said
“In this quarter, we also saw the benefits of having Novitium, a world-class R&D engine, after the acquisition was fully closed in November last year. We successfully launched several products totaling approximately
First Quarter 2022 Financial Highlights:
-
Net revenues were
$64.5 million $54.5 million -
GAAP net loss was
$(20.1) million $(1.27) -
Adjusted non-GAAP EBITDA was
$4.3 million $18.9 million -
Adjusted non-GAAP diluted loss per share was
$(0.12) $1.04 -
Cash and cash equivalents were
$76.9 million $131.6 million $299.3 million March 31, 2022 .
Cortrophin Gel Launch Progress:
On
Key highlights of the launch progress include:
-
Launch Trajectory: Over 250 new patient cases have been initiated since the launch on
January 24 , with steady growth in the number of new patient cases per week. Since launch, the average time from new case initiation to patient dispense has significantly improved, leading to a steady increase of patients on Cortrophin Gel. The Company’s market access efforts to date have led to formulary coverage for Cortrophin Gel for over 100 million lives. -
Physician Interest: The ANI Rare Disease team has generated significant awareness of and interest in Cortrophin Gel among physicians. Over 125 unique prescribers have initiated new cases for Cortrophin Gel therapy, and of these, approximately
25% have enrolled more than one patient. Initial enrollments are distributed relatively evenly across targeted specialties of rheumatology, neurology and nephrology. -
Strong Execution: The Company’s dedicated and experienced Rare Disease sales team has already reached approximately
50% of targeted prescribers. In addition, the Company continues to invest significantly in marketing and market access with cross-functional teams engaging key stakeholders. Our patient services organization remains focused on establishing expanded access to Cortrophin Gel for patients and their caregivers throughout the treatment journey.
Novitium Integration Update:
On
Key updates of the integration include:
- Focus on R&D Excellence: The R&D engine continues to deliver with six new ANDA filings and several limited competition new product launches in the first quarter. In addition, the Company retained its leadership in Competitive Generic Therapy (CGT) approvals. Most recently, ANI received CGT approval and associated 180 days of exclusivity for betaine anyhydrous solution. The Company remains focused on strengthening the product pipeline to increase sustainability of the generics business.
- Commercial Integration: The commercial team has fully integrated and executed several new product launches successfully, strengthened relationships with key customers, and captured organizational synergies.
- Operational Synergies: The Company has captured synergies in key areas such as Procurement, Distribution, and Manufacturing Operations. The Company will increase efforts in this area to drive cost-competitiveness.
First Quarter 2022 Financial Results |
|||||||
| Three Months Ended | |||||||
| Products and Services |
|
|
|||||
| (in thousands) | 2022 |
2021 |
|||||
| Sales of generic pharmaceutical products | $ | 49,107 |
$ | 32,988 |
|||
| Sales of established brand pharmaceutical products | 8,452 |
7,517 |
|||||
| Sales of rare disease pharmaceutical products | 1,292 |
— |
|||||
| Sales of contract manufactured products | 2,904 |
2,573 |
|||||
| Royalties from licensing agreements | 1,903 |
11,210 |
|||||
| Product development services | 566 |
158 |
|||||
| Other | 253 |
75 |
|||||
| Total net revenues | $ | 64,477 |
$ | 54,521 |
|||
Net revenues for generic pharmaceutical products were
Net revenues for branded pharmaceutical products were
Contract manufacturing revenues were
Royalty and other revenues were
Net revenues of rare disease pharmaceutical products were
Operating expenses increased by
Cost of sales, excluding depreciation and amortization, increased by
Research and development expenses were
Selling, general and administrative expenses increased to
Depreciation and amortization expense was
Net loss for the first quarter of 2022 was
Adjusted non-GAAP diluted loss per share was
For reconciliations of adjusted non-GAAP EBITDA and adjusted non-GAAP diluted (loss)/earnings per share to the most directly comparable GAAP financial measure, please see Table 3 and Table 4, respectively.
Liquidity
As of
2022 GUIDANCE
ANI is initiating guidance on Cortrophin Gel specific Net Revenue, total Company Net Revenue, total Company adjusted non-GAAP EBITDA, and total Company adjusted non-GAAP Diluted Earnings per Share, and is reiterating its previous guidance on total Company research and development expense and Cortrophin Gel Selling, General and Administrative expense. The following summarizes 2022 guidance:
- Net Revenue between
- Research and Development expense between
- Adjusted non-GAAP EBITDA between
- Adjusted non-GAAP Diluted Earnings per Share between
Purified Cortrophin Gel specific measures:
- Net Revenue between
- Direct Selling, General and Administrative expenses between
In addition, we currently anticipate between 16.9 and 17.0 million shares outstanding and an effective tax rate of approximately
Conference Call
As previously announced, ANI management will host its first quarter 2022 conference call as follows:
Date |
|
|
Time |
|
|
Toll free ( |
866-342-8591 |
|
Global |
203-518-9822 |
|
Webcast (live and replay) section |
www.anipharmaceuticals.com, under the “Investors” |
A replay of the conference call will be available within two hours of the call’s completion and will remain accessible for one week by dialing 800-753-4606 and entering access code 5146584.
Non-GAAP Financial Measures
Adjusted non-GAAP EBITDA
ANI’s management considers adjusted non-GAAP EBITDA to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by non-cash stock-based compensation and differences in capital structures, tax structures, capital investment cycles, ages of related assets, and compensation structures among otherwise comparable companies. Management uses adjusted non-GAAP EBITDA when analyzing Company performance.
Adjusted non-GAAP EBITDA is defined as net (loss)/income, excluding tax expense or benefit, interest expense, (net), other expense, (net), depreciation, amortization, the excess of fair value over cost of acquired inventory, non-cash stock-based compensation expense, Novitium transaction expenses, Cortrophin Gel pre-launch charges, contingent consideration fair value adjustment, and certain other items that vary in frequency and impact on ANI’s results of operations. Adjusted non-GAAP EBITDA should be considered in addition to, but not in lieu of, net income or loss reported under GAAP. A reconciliation of adjusted non-GAAP EBITDA to the most directly comparable GAAP financial measure is provided below.
ANI is not providing a reconciliation for the forward-looking full year 2022 adjusted EBITDA guidance because it does not currently have sufficient information to accurately estimate all of the variables and individual adjustments for such reconciliation, including “with” and “without” tax provision information. As such, ANI’s management cannot estimate on a forward-looking basis without unreasonable effort the impact these variables and individual adjustments will have on its reported results.
Adjusted non-GAAP Net (Loss)/Income
ANI’s management considers adjusted non-GAAP net (loss)/income to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation, non-cash interest expense, depreciation and amortization, Cortrophin Gel pre-launch charges, Novitium transaction expenses, contingent consideration fair value adjustment, and certain other items that vary in frequency and impact on ANI’s results of operations. Management uses adjusted non-GAAP net (loss)/income when analyzing Company performance.
Adjusted non-GAAP net (loss)/income is defined as net (loss)/income, plus the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation expense, Novitium transaction expenses, non-cash interest expense, depreciation and amortization expense, Cortrophin Gel pre-launch charges, contingent consideration fair value adjustment, and certain other items that vary in frequency and impact on ANI’s results of operations, less the tax impact of these adjustments calculated using an estimated statutory tax rate. Management will continually analyze this metric and may include additional adjustments in the calculation in order to provide further understanding of ANI’s results. Adjusted non-GAAP net (loss)/income should be considered in addition to, but not in lieu of, net (loss)/income reported under GAAP. A reconciliation of adjusted non-GAAP net (loss)/income to the most directly comparable GAAP financial measure is provided below.
Adjusted non-GAAP Diluted (Loss)/Earnings per Share
ANI’s management considers adjusted non-GAAP diluted (loss)/earnings per share to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation, non-cash interest expense, depreciation and amortization, Cortrophin Gel pre-launch charges, Novitium transaction expenses, contingent consideration fair value adjustment, and certain other items that vary in frequency and impact on ANI’s results of operations. Management uses adjusted non-GAAP diluted (loss)/earnings per share when analyzing Company performance.
Adjusted non-GAAP diluted (loss)/earnings per share is defined as adjusted non-GAAP net (loss)/income, as defined above, divided by the diluted weighted average shares outstanding during the period. Management will continually analyze this metric and may include additional adjustments in the calculation in order to provide further understanding of ANI’s results. Adjusted non-GAAP diluted (loss)/earnings per share should be considered in addition to, but not in lieu of, diluted earnings or loss per share reported under GAAP. A reconciliation of adjusted non-GAAP diluted (loss)/earnings per share to the most directly comparable GAAP financial measure is provided below.
About ANI
Forward-Looking Statements
To the extent any statements made in this release relate to information that is not historical, these are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements regarding 2022 Financial Guidance, statements about the Company’s corporate strategy, future operations, products, financial performance, financial position, operating results and prospects, including plans for sustainable growth, and other statements that are not historical in nature, particularly those that utilize terminology such as “anticipates,” “will,” “expects,” “plans,” “potential,” “future,” “believes,” “intends,” “continue,” other words of similar meaning, derivations of such words and the use of future dates.
Uncertainties and risks may cause the Company’s actual results to be materially different than those expressed in or implied by such forward-looking statements. Uncertainties and risks include, but are not limited to, the costs involved in commercializing Cortrophin Gel, the ability to maintain regulatory approval of the product and maintain sufficiency of the product, the ability to obtain reimbursement from third-party payors for this product, evolving government legislation, the opinions and views of key opinion leaders and physicians who treat patients with chronic diseases and who may prescribe Cortrophin Gel, ANI’s ability to generate projected net product revenue and gain market share on the timeline expected, actions taken by competitors in response to a new market entrant; the ability of the Company to successfully maintain manufacturing capabilities and adequate commercial quantities of Cortrophin Gel at acceptable costs and quality levels; broad acceptance of Cortrophin Gel by physicians, patients and the healthcare community; the acceptance of pricing and placement of Cortrophin Gel on payers’ formularies; risks the Company may face with respect to importing raw materials; the use of single source suppliers and the time it may take to validate and qualify another supplier, if necessary; manufacturing difficulties or delays, ANI’s reliance on third parties over which it may not always have full control, increased competition and strategies employed by competitors; the ability to realize benefits anticipated from acquisitions; costs and regulatory requirements relating to contract manufacturing arrangements; delays or failure in obtaining product approvals from the
More detailed information on these and additional factors that could affect the Company’s actual results are described in the Company’s filings with the
For more details, visit www.cortrophin.com.
Table 1: US GAAP Statement of Operations |
|||||||||
(unaudited, in thousands, except per share amounts) |
|||||||||
| Three Months Ended |
|||||||||
|
2022 |
|
|
2021 |
|
||||
| Net Revenues | $ |
64,477 |
|
$ |
54,521 |
|
|||
| Operating Expenses: | |||||||||
| Cost of sales (excl. depreciation | |||||||||
| and amortization) |
|
34,271 |
|
|
19,985 |
|
|||
| Research and development |
|
5,274 |
|
|
2,968 |
|
|||
| Selling, general, and administrative |
|
28,817 |
|
|
17,587 |
|
|||
| Depreciation and amortization |
|
14,557 |
|
|
10,898 |
|
|||
| Contingent consideration fair value adjustment |
|
753 |
|
|
- |
|
|||
| Purified Cortrophin Gel pre-launch charges |
|
- |
|
|
38 |
|
|||
Total Operating Expenses |
|
83,672 |
|
|
51,476 |
|
|||
Operating (Loss)/Income |
|
(19,195 |
) |
|
3,045 |
|
|||
| Other Expense, Net | |||||||||
Interest expense, net |
|
(6,613 |
) |
|
(2,454 |
) |
|||
| Other expense, net |
|
(89 |
) |
|
(515 |
) |
|||
| (Loss)/Income Before Benefit for Income Taxes |
|
(25,897 |
) |
|
76 |
|
|||
| Benefit for income taxes |
|
5,767 |
|
|
10 |
|
|||
| Net (Loss)/Income | $ |
(20,130 |
) |
$ |
86 |
|
|||
| Dividends on Series A Convertible Preferred Stock |
|
(405 |
) |
|
- |
|
|||
| Net (Loss)/Income Allocated to Common Shares | $ |
(20,535 |
) |
$ |
86 |
|
|||
| Basic and Diluted (Loss)/Earnings Per Share: | |||||||||
| Basic (Loss)/Earnings Per Share | $ |
(1.27 |
) |
$ |
0.01 |
|
|||
| Diluted (Loss)/Earnings Per Share | $ |
(1.27 |
) |
$ |
0.01 |
|
|||
| Basic Weighted-Average Shares Outstanding |
|
16,137 |
|
|
12,004 |
|
|||
| Diluted Weighted-Average Shares Outstanding |
|
16,137 |
|
|
12,017 |
|
|||
| Table 2: US GAAP Balance Sheets | ||||||||||
| (uaudited, in thousands) | ||||||||||
2022 |
2021 |
|||||||||
| Current Assets | ||||||||||
| Cash and cash equivalents | $ |
76,911 |
|
$ |
100,300 |
|
||||
| Accounts receivable, net |
|
131,625 |
|
|
128,526 |
|
||||
| Inventories, net |
|
83,155 |
|
|
81,693 |
|
||||
| Prepaid income taxes |
|
1,982 |
|
|
3,667 |
|
||||
| Prepaid expenses and other current assets |
|
7,726 |
|
|
7,589 |
|
||||
| Total Current Assets |
|
301,399 |
|
|
321,775 |
|
||||
| Non-current Assets | ||||||||||
| Property and equipment |
|
77,677 |
|
|
75,627 |
|
||||
| Accumulated depreciation |
|
(24,964 |
) |
|
(22,956 |
) |
||||
| Property and equipment, net |
|
52,713 |
|
|
52,671 |
|
||||
| Restricted cash |
|
5,000 |
|
|
5,001 |
|
||||
Deferred tax assets, net of deferred tax liabilities and valuation allowance |
|
73,539 |
|
|
67,936 |
|
||||
| Intangible assets, net |
|
281,573 |
|
|
294,122 |
|
||||
|
28,188 |
|
|
27,888 |
|
|||||
| Derivatives and other non-current assets |
|
2,434 |
|
|
2,205 |
|
||||
| Total Assets | $ |
744,846 |
|
$ |
771,598 |
|
||||
| Current Liabilities | ||||||||||
| Current debt, net of deferred financing costs | $ |
850 |
|
$ |
850 |
|
||||
| Accounts payable |
|
22,059 |
|
|
22,967 |
|
||||
| Accrued royalties |
|
4,998 |
|
|
6,225 |
|
||||
| Accrued compensation and related expenses |
|
3,265 |
|
|
8,522 |
|
||||
| Accrued government rebates |
|
4,557 |
|
|
5,492 |
|
||||
| Returned goods reserve |
|
35,554 |
|
|
35,831 |
|
||||
| Deferred revenue |
|
116 |
|
|
87 |
|
||||
| Accrued expenses and other |
|
8,133 |
|
|
7,563 |
|
||||
| Total Current Liabilities |
|
79,532 |
|
|
87,537 |
|
||||
| Non-current Liabilities | ||||||||||
| Non-current debt, net of deferred financing costs and current component |
|
286,307 |
|
|
286,520 |
|
||||
| Non-current contingent consideration |
|
32,053 |
|
|
31,000 |
|
||||
| Derivatives and other non-current liabilities |
|
860 |
|
|
7,801 |
|
||||
| Total Liabilities |
|
398,752 |
|
|
412,858 |
|
||||
| Mezzanine Equity | ||||||||||
| Convertible preferred stock, Series A |
|
24,850 |
|
|
24,850 |
|
||||
| Stockholders' Equity | ||||||||||
| Common stock |
|
1 |
|
|
1 |
|
||||
|
(4,253 |
) |
|
(3,135 |
) |
|||||
| Additional paid-in capital |
|
391,084 |
|
|
387,844 |
|
||||
| Accumulated deficit |
|
(68,300 |
) |
|
(47,765 |
) |
||||
| Accumulated other comprehensive income/(loss), net of tax |
|
2,712 |
|
|
(3,055 |
) |
||||
| Total Stockholders' Equity |
|
321,244 |
|
|
333,890 |
|
||||
| Total Liabilities, Mezzanine Equity, and Stockholders' Equity | $ |
744,846 |
|
$ |
771,598 |
|
||||
| Table 3: Adjusted non-GAAP EBITDA Calculation and US GAAP to Non-GAAP Reconciliation | ||||||||||||||||||||||||||||||
| (unaudited, in thousands) | ||||||||||||||||||||||||||||||
Reconciliation of certain adjusted non-GAAP accounts: |
||||||||||||||||||||||||||||||
Cost of sales (excl. depreciation and amortization) |
Selling, general, and administrative expenses |
Research and development expenses |
||||||||||||||||||||||||||||
Three Months Ended
|
Three Months Ended
|
Three Months Ended
|
Three Months Ended
|
|||||||||||||||||||||||||||
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|||||||
| Net (Loss)/Income | $ |
(20,130 |
) |
$ |
86 |
|
As reported: | $ |
34,271 |
|
$ |
19,985 |
|
$ |
28,817 |
|
$ |
17,587 |
|
$ |
5,274 |
|
$ |
2,968 |
|
|||||
| Add/(Subtract): | ||||||||||||||||||||||||||||||
| Interest expense, net |
|
6,613 |
|
|
2,454 |
|
||||||||||||||||||||||||
| Other expense/(income), net |
|
89 |
|
|
515 |
|
||||||||||||||||||||||||
| Benefit for income taxes |
|
(5,767 |
) |
|
(10 |
) |
||||||||||||||||||||||||
| Depreciation and amortization |
|
14,557 |
|
|
10,898 |
|
||||||||||||||||||||||||
| Contingent consideration fair value adjustment |
|
753 |
|
|
- |
|
||||||||||||||||||||||||
| Cortrophin pre-launch charges and sales & marketing expenses(1) |
|
- |
|
|
141 |
|
Cortrophin pre-launch charges and sales & marketing expenses(1) |
|
- |
|
|
(103 |
) |
|||||||||||||||||
| Stock-based compensation |
|
3,237 |
|
|
1,869 |
|
Stock-based compensation |
|
(145 |
) |
|
(4 |
) |
|
(2,839 |
) |
|
(1,746 |
) |
|
(253 |
) |
|
(119 |
) |
|||||
| Excess of fair value over cost of acquired inventory |
|
3,829 |
|
|
- |
|
Excess of fair value over cost of acquired inventory |
|
(3,829 |
) |
||||||||||||||||||||
| Novitium transaction expenses |
|
1,092 |
|
|
2,943 |
|
Novitium transaction expenses |
|
(1,092 |
) |
|
(2,943 |
) |
|||||||||||||||||
| Adjusted non-GAAP EBITDA | $ |
4,273 |
|
$ |
18,896 |
|
As adjusted: | $ |
30,297 |
|
$ |
19,981 |
|
$ |
24,886 |
|
$ |
12,795 |
|
$ |
5,021 |
|
$ |
2,849 |
|
|||||
| (1) Beginning in 2022, we no longer adjust for "Cortrophin pre-launch charges and sales and marketing expenses" in arriving at Adjusted non-GAAP EBTIDA and Adjusted non-GAAP Net (Loss)/Income. | ||||||||||||||||||||||||||||||
| Table 4: Adjusted non-GAAP Net (Loss)/Income and Adjusted non-GAAP Diluted (Loss)/Earnings per Share Reconciliation | |||||||||
| (unaudited, in thousands, except per share amounts) | |||||||||
| Three Months Ended |
|||||||||
|
2022 |
|
|
2021 |
|
||||
| Net (Loss)/Income | $ |
(20,535 |
) |
$ |
86 |
|
|||
| Add/(Subtract): | |||||||||
| Non-cash interest expense |
|
953 |
|
|
546 |
|
|||
| Depreciation and amortization expense |
|
14,557 |
|
|
10,898 |
|
|||
| Contingent consideration fair value adjustment |
|
753 |
|
||||||
| Cortrophin pre-launch charges and sales & marketing expenses(1) |
|
- |
|
|
141 |
|
|||
| Stock-based compensation |
|
3,237 |
|
|
1,869 |
|
|||
| Excess of fair value over cost of acquired inventory |
|
3,829 |
|
|
- |
|
|||
| Novitium transaction expenses |
|
1,092 |
|
|
2,943 |
|
|||
| Less: | |||||||||
| Estimated tax impact of adjustments (calc. at |
|
(5,861 |
) |
|
(3,935 |
) |
|||
| Adjusted non-GAAP Net (Loss)/Income | $ |
(1,975 |
) |
$ |
12,548 |
|
|||
| Diluted Weighted-Average | |||||||||
| Shares Outstanding |
|
16,137 |
|
|
12,017 |
|
|||
| Adjusted Diluted Weighted-Average | |||||||||
| Shares Outstanding |
|
16,137 |
|
|
12,017 |
|
|||
| Adjusted non-GAAP | |||||||||
| Diluted (Loss)/Earnings per Share | $ |
(0.12 |
) |
$ |
1.04 |
|
|||
| (1) Beginning in 2022, we no longer adjust for "Cortrophin pre-launch charges and sales and marketing expenses" in arriving at Adjusted non-GAAP EBTIDA and Adjusted non-GAAP Net (Loss)/Income. | |||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20220510005388/en/
Investors
212-452-2793
lwilson@insitecony.com
Source:
FAQ
What were ANI Pharmaceuticals' financial results for Q1 2022?
What is the 2022 revenue guidance for Cortrophin Gel?
How many new patient cases of Cortrophin Gel have been initiated?
What is the adjusted non-GAAP EBITDA for Q1 2022?
What factors contributed to the net loss in Q1 2022?
