Opiant Pharmaceuticals Announces Second Quarter and First Half 2022 Financial Results and Provides Corporate Update

Rhea-AI Summary

Opiant Pharmaceuticals (NASDAQ: OPNT) reported Q2 2022 revenues of $3.9 million, a decline from $11.3 million in Q2 2021, attributing $2.3 million to NARCAN® sales through Emergent BioSolutions (EBS). Opiant issued a default notice to EBS for underpayment of royalties, claiming $9.1 million is owed. R&D expenses surged to $7.9 million, up from $3.1 million year-over-year. The net loss for Q2 2022 was approximately $11.8 million, marking a substantial decline from a net income in Q2 2021. Opiant maintains a strong financial position with $40.2 million in cash as of June 30, 2022, and continues development of OPNT003 for opioid overdose.

Positive

• Completion of NDA for OPNT003 expected in H2 2022.
• Received $2.1 million funding from BARDA for OPNT003.
• U.S. Patent Office issued a Notice of Allowance for OPNT003 patent.

Negative

• Q2 2022 revenues declined to $3.9 million from $11.3 million in Q2 2021.
• Net loss of approximately $11.8 million in Q2 2022 compared to a net income in Q2 2021.
• Increased R&D expenses to $7.9 million from $3.1 million year-over-year.

SANTA MONICA, Calif., Aug. 11, 2022 (GLOBE NEWSWIRE) -- Opiant Pharmaceuticals, Inc. (“Opiant”) (NASDAQ: OPNT), a specialty pharmaceutical company developing medicines to treat addictions and drug overdose, today reported financial results for the three months and six months ended June 30, 2022, and provided a corporate update. Recent highlights include:

Pipeline Update

• Rolling New Drug Application (NDA) submission for OPNT003, nasal nalmefene for opioid overdose remains on track, with completion expected in the second half of 2022
  
  
• Announced that the United States (U.S.) Patent and Trademark Office has issued a Notice of Allowance for U.S. patent with claims covering OPNT003 for opioid overdose
  
  
• Enrollment and dosing on track in 300-patient Phase 2 study for OPNT002, nasal naltrexone, for Alcohol Use Disorder (AUD); data expected in H1 2023
  

Finance Update

• Q2 revenues of $3.9 million; $2.3 million of revenue was attributable to the sales of NARCAN^® Nasal Spray from Opiant’s License Agreement with Emergent BioSolutions, Inc. (EBS)
  
  
  • EBS communicated that royalties from U.S. NARCAN^® sales were calculated using a 2% rate, despite Q2 2022 U.S. net sales having been greater than 70% of Q3 2021 thus requiring higher rates
    
    
  • Opiant delivered to EBS a default notice of material breach of its License Agreement for failure to pay the royalty rate set out in the License Agreement
    
    
• Announced $2.1 million funding awarded under its contract with the Biomedical Advanced Research and Development Authority (BARDA) for OPNT003 nasal nalmefene
  
  
• Approximately $40.2 million in cash and cash equivalents, as of June 30, 2022
  

Commenting, Roger Crystal, M.D., President and Chief Executive Officer of Opiant, said:

“At Opiant, we feel a strong sense of urgency to meet the need for new treatment options for opioid overdose, driven largely by fentanyl and other very potent illicit synthetic opioids, which are doing so much harm in our communities. We are on track to complete our NDA this year, and believe that OPNT003, nasal nalmefene, is particularly well suited to help confront this national overdose crisis. The value of OPNT003 was further validated by the allowance of our patent application by the USPTO. By year-end, we also anticipate completing enrollment in the Phase 2 study evaluating OPNT002 for the treatment of Alcohol Use Disorder, with data expected during the first half of next year. I am excited by the progress we have made and look forward to advancing our mission to deliver medicines to better treat addiction and drug overdose.”

David O’Toole, Chief Financial Officer of Opiant, said:

“Looking ahead, we are prudently managing expenses while maintaining our good financial position with multiple value creating catalysts expected over the next 12 months. With that said, we intend to pursue all avenues to ensure the terms of the NARCAN^® licensing agreement are appropriately enforced.”

Financial Results for the Three Months Ended June 30, 2022

For the three months ended June 30, 2022, Opiant recorded approximately $3.9 million in revenue, compared to approximately $11.3 million during the corresponding period of 2021. For the three months ended June 30, 2022, the Company recorded approximately $2.3 million of revenue from its license agreement with Emergent BioSolutions, Inc. (EBS) for the sale of NARCAN^®, and $1.6 million from grant and contract revenue, compared to approximately $9.3 million and $1.9 million respectively in the same period of 2021. Second quarter 2022 sales of NARCAN^® were approximately $101.5 million, as reported by EBS.

For the three months ended June 30, 2022, general and administrative (G&A) expenses were approximately $4.0 million, as compared to approximately $2.7 million in the comparable period in 2021. Personnel and non-cash stock-based compensation expense increased by $1.3 million.

Research and development (R&D) expenses for the three months ended June 30, 2022, increased by $4.8 million to $7.9 million, from $3.1 million for the three months ended June 30, 2021. External development expense increased by $3.9 million primarily due to increased activity on our lead product candidate, OPNT003, nasal nalmefene, for opioid overdose, and personnel and non-cash stock-based compensation expense increased by $0.9 million.

Sales and marketing (S&M) expenses for the three months ended June 30, 2022, were approximately $2.8 million, as compared to approximately $1.0 million in the comparable period in 2021. Personnel and non-cash stock-based compensation expense increased by $1.1 million and external third party spend related to pre-commercial activities increased by $0.7 million.

Royalty expense for the three months ended June 30, 2022, was approximately $0.5 million, compared to $2.1 million in the comparable period in 2021.

During the three months ended June 30, 2022, interest expense was $0.4 million compared to $0.5 million during the three months ended June 30, 2021. Interest expense is all related to the Company’s convertible debt.

Net loss for the three months ended June 30, 2022, was approximately $11.8 million, or a loss of $2.31 per basic share and diluted share, compared to net income of approximately $1.7 million, or $0.39 per basic and $0.31 per diluted share, for the comparable period of 2021.

On August 10, 2022, Opiant delivered a Default Notice to EBS under section 10.3 of its License Agreement. The Default Notice put EBS on notice it had materially breached one or more of its obligations under the License Agreement. Opiant stated cause for breach based upon the royalty report EBS provided Opiant for the quarter ended June 30, 2022. The EBS royalty report confirmed U.S. net NARCAN^® sales during the second quarter were greater than 70% of the U.S. net NARCAN^® sales in the third quarter 2021. As provided under the License Agreement, the Generic Reduction Clause would not apply and Opiant should have been entitled to the higher tiered royalty rate structure. However, EBS arbitrarily applied a 2% rate, disregarding the terms of the License Agreement, and resulting in a royalty payment of approximately $2.3 million. Opiant believes that it is due approximately $9.1 million, a significantly higher royalty payment. The Default Notice allows EBS sixty days to meet its obligations under the License Agreement and pay the correct amount owed. If EBS fails do so, Opiant intends to vigorously pursue all remedies aimed at ensuring EBS complies with the existing License Agreement. The License Agreement was originally between LightLake Therapeutics Inc. and Adapt Pharma Limited, which Opiant and EBS are successors to, respectively.

Financial Results for the Six Months Ended June 30, 2022

For the six months ended June 30, 2022, Opiant recorded approximately $8.4 million of revenue, compared to $17.6 million during the corresponding period of 2021. For the six months ended June 30, 2022, Opiant recognized $4.5 million of revenue from its license agreement with EBS and $3.8 million from grant and contract revenue. This compares to $13.6 million and $4.0 million, respectively, for the same period in 2021. First half 2022 sales of NARCAN^® were approximately $194.6 million, as reported by EBS.

For the six months ended June 30, 2022, G&A expenses were approximately $8.3 million, compared to $5.4 million in 2021. Personnel and non-cash stock-based compensation increased by $2.4 million along with a net increase of approximately $0.5 million associated with legal and other fees for the six months ended June 30, 2022, compared to the six months ended June 30, 2021.

R&D expenses during the six months ended June 30, 2022, increased by $9.5 million to $16.7 million, compared to $7.2 million for the six months ended June 30, 2021. The increase was primarily due to increased activity by $7.8 million on our lead product candidate, OPNT003, nasal nalmefene, and to personnel and non-cash stock-based compensation expense of $1.7 million.

S&M expenses for the six months ended June 30, 2022, increased by $3.5 million to $5.5 million from $2.0 million for the six months ended June 30, 2021. Personnel and non-cash stock-based compensation expense increased by $2.0 million, and external third party spend related to pre-commercial activities increased by $1.5 million.

Royalty expense for the six months ended June 30, 2022, was approximately $0.9 million, compared to approximately $3.1 million for the comparable period of 2021. The decrease of $2.2 million is attributable to the decrease in net revenue recorded from sales of NARCAN^® by EBS.

Net loss for the six months ended June 30, 2022, was approximately $24.0 million, or a loss of $4.74 per basic and diluted share, compared to net loss of approximately $1.2 million, or a loss of $0.27 per basic and diluted share, for the comparable period of 2021.

As of June 30, 2022, Opiant had $40.2 million in cash and cash equivalents.

In August, Opiant announced that the Biomedical Advanced Research and Development Authority (BARDA) has awarded an additional approximately $2.1 million to support OPNT003, nasal nalmefene. The funding is primarily directed toward the preparation and filing of a New Drug Application for OPNT003 to the Food and Drug Administration.

Awards from BARDA for up to $10.8 million, combined with a $7.4 million grant Opiant received from the National Institute on Drug Abuse, support the clinical development and U.S. regulatory submission of OPNT003. The contract with BARDA will also potentially allow for the development of OPNT003 as a medical countermeasure in a chemical attack using weaponized synthetic opioids as well as reverse opioid overdoses in the community.

BARDA is part of the Office of the Assistant Secretary for Preparedness and Response within the U.S. Department of Health and Human Services. This project has been funded in whole or in part with federal funds from the Department of Health and Human Services; Office of the Assistant Secretary for Preparedness and Response; Biomedical Advanced Research and Development Authority, under Contract No. HHSO100201800029C.

Conference Call Details:
Thursday, August 11th at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time
Toll Free:	1-877-407-0792
International:	1-201-689-8263
Conference ID:	13730815
Webcast:	http://ir.opiant.com/

About Opiant Pharmaceuticals, Inc.
Opiant Pharmaceuticals, Inc., the company that developed NARCAN^® Nasal Spray, is building a leading franchise of new medicines to combat addictions and drug overdose. For more information visit: www.opiant.com.

Forward-Looking Statements
This press release contains forward-looking statements. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, implied or inferred by these forward-looking statements, and among other things, submit a New Drug Application in the second half of 2022. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "would," "expects," "plans," "intends," "anticipates," "believes," "estimates," "predicts," "projects," "potential," or "continue" or the negative of such terms and other comparable terminology. These statements are only predictions based on our current expectations and projections about future events. You should not place undue reliance on these statements. Actual events or results may differ materially. In evaluating these statements, you should specifically consider various factors. Additional factors that could materially affect actual results can be found in our Form 10-K for the year ended December 31, 2021, and our Form 10-Q for the quarter ended June 30, 2022, filed with the Securities and Exchange Commission on March 4, 2022, and August 11, 2022, respectively, including under the caption titled "Risk Factors."  These and other factors may cause our actual results to differ materially from any forward-looking statement. We undertake no obligation to update any of the forward-looking statements after the date of this press release to conform those statements to reflect the occurrence of unanticipated events, except as required by applicable law.

Investor Relations Contacts:

Ben Atkins
VP of Corporate Communications and Investor Relations
Batkins@opiant.com
(310) 598-5410

Opiant Pharmaceuticals, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except shares and per share amounts)
			As of June 30				As of December 31,
			2022				2021
Assets			(unaudited)
	Current Assets
		Cash & cash equivalents	$	40,173			$	37,854
		Marketable securities		-			$	15,015
		Accounts receivable		2,336				13,327
		Unbilled receivable		1,637				-
		Prepaid and other current assets		3,612				2,963
		Total Current Assets		47,758				69,159
	Other Assets
		Property and equipment, net		71				78
		Right of use assets - operating leases		733				1,000
		Patents and patent applications, net		11				12
		Other non-current assets		251				179
		Total Assets	$	48,824			$	70,428
Liabilities and stockholders' equity
	Current Liabilities
		Accounts payable and accrued expenses	$	3,102			$	3,370
		Accrued salaries & wages		1,226				202
		Royalty payable		440				2,920
		Deferred revenue		-				17
		Operating leases		227				338
		Total Current Liabilities		4,995				6,847
	Long-Term Liabilities
		Operating leases - long term		523				673
		Convertible debt - net of unamortized discount		13,710				16,069
		Total Long-Term Liabilities		14,233				16,742
		Total Liabilities		19,228				23,589
	Stockholders' equity
	Common stock, $0.001 par value, 200,000,000 shares
		authorized, 5,122,575 and 4,909,846 shares
		issued and outstanding at June 30, 2022 and
		December 31, 2021, respectively		5				4
	Additional paid-in-capital			115,439				108,570
	Accumulated other comprehensive loss			(243	)			(55	)
	Accumulated deficit			(85,605	)			(61,680	)
		Total stockholders' equity		29,596				46,839
		Total liabilities and stockholders' equity	$	48,824			$	70,428

Opiant Pharmaceuticals Inc.
Condensed Consolidated Statements of Operations
(in thousands, except shares and per share amounts)
			Three months ended				Three months ended				Six months ended				Six months ended
			June 30				June 30				June 30				June 30
			2022				2021				2022				2021
			(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Revenues
	Royalty revenue		$	2,326			$	9,314			$	4,520			$	13,648
	Grant and contract revenue			1,568				1,945				3,845				3,998
		Total Revenue		3,894				11,259				8,365				17,646
Operating expenses
	General and administrative			4,011				2,733				8,343				5,380
	Research and development			7,916				3,150				16,739				7,238
	Sales & marketing			2,816				1,023				5,493				2,020
	Royalty expense			517				2,107				943				3,086
		Total expenses		15,260				9,013				31,518				17,724
Income (loss) from operations				(11,366	)			2,246				(23,153	)			(78	)
Other income (expense)
	Interest income			63				4				68				7
	Interest expense			(401	)			(542	)			(822	)			(1,079	)
	Loss on foreign exchange							(24	)			16				(10	)
		Total other income (expense)		(338	)			(562	)			(738	)			(1,082	)
Income (loss) before provision for income taxes				(11,704	)			1,684				(23,891	)			(1,160	)
	Income tax expense			(33	)			-				(33	)			-
Net income (loss)			$	(11,737	)		$	1,684			$	(23,924	)		$	(1,160	)
Other comprehensive income (loss):
	Foreign currency translationadjustment			(161	)			(5	)			(188	)			8
Comprehensive income (loss)			$	(11,898	)		$	1,679			$	(24,112	)		$	(1,152	)
Net income (loss) per common share
	Basic		$	(2.31	)		$	0.39			$	(4.74	)		$	(0.27	)
	Diluted		$	(2.31	)		$	0.31			$	(4.74	)		$	(0.27	)
Weighted-average common shares outstanding:
	Basic			5,087,647				4,332,601				5,051,814				4,308,027
	Diluted			5,087,647				5,427,831				5,051,814				4,308,027

FAQ

What were Opiant's earnings results for Q2 2022?

Opiant reported Q2 2022 revenues of $3.9 million, down from $11.3 million in Q2 2021, with a net loss of approximately $11.8 million.

What is the status of Opiant's OPNT003 drug development?

Opiant is on track to complete the New Drug Application (NDA) for OPNT003 in the second half of 2022.

How much cash does Opiant have as of June 30, 2022?

Opiant reported approximately $40.2 million in cash and cash equivalents as of June 30, 2022.

What funding did Opiant receive recently?

Opiant was awarded approximately $2.1 million from BARDA for the development of OPNT003.

What issues has Opiant raised with Emergent BioSolutions regarding NARCAN®?

Opiant issued a default notice to EBS for underpayment of royalties, claiming they are owed approximately $9.1 million.