Results Driven by 73% Growth in
Revenue
Sucampo Pharmaceuticals, Inc. (Sucampo) (NASDAQ:SCMP), a global
biopharmaceutical company, today reported consolidated financial
results for the third quarter ended September 30, 2016. The
company also highlighted important corporate updates.
Summary of Results |
Q3-16 |
% Increase / (Decrease)over Q3-15 |
Revenue |
$57.9M |
|
73 |
% |
Net Income GAAP |
$8.1M |
|
12 |
% |
EPS GAAP – diluted |
$ |
0.19 |
|
|
19 |
% |
EBITDA |
$35.6M |
|
197 |
% |
Adjusted Net Income |
$12.4M |
|
58 |
% |
Adjusted EPS – diluted |
$ |
0.28 |
|
|
68 |
% |
Adjusted EBITDA |
$28.8M |
|
97 |
% |
Key Updates
- Recently completed a settlement and license agreement with Dr.
Reddy’s Laboratories, Ltd. and certain of its affiliates (Dr.
Reddy’s) that resolves patent litigation in the United States
related to Sucampo’s AMITIZA (lubiprostone) 8 mcg and 24 mcg soft
gelatin capsules. The agreement provides for an entry date
more than six years from today’s date and profit sharing on product
sales by Dr. Reddy’s.
- A phase 3 trial of AMITIZA in pediatric functional constipation
in children six to seventeen years of age did not achieve its
primary endpoint of overall spontaneous bowel movement (SBM)
response. However, the trial did show a trend in favor of
lubiprostone for the primary endpoint, and achieved statistical
significance in some secondary endpoints, notably overall SBM
frequency, straining, and stool consistency. Clinical
development of AMITIZA with a sprinkle formulation and phase three
trials in adults and children six months to less than six years of
age using the sprinkle formulation will continue as
planned.
- Increased adjusted 2016 guidance as follows: revenue guidance
to $220-225 million, adjusted net income guidance to $50-55
million, adjusted EPS guidance to $1.20-1.25, and adjusted EBITDA
guidance to $110-115 million.
“We are very excited that we have achieved
another significant quarter of strong financial results, driven by
solid global performance of our flagship brand, AMITIZA.
Additionally, we continued to make significant progress on many
important areas of our business, including the resolution of our
patent litigation with Dr. Reddy’s Laboratories that affords us
greater certainty on the significant future value of the AMITIZA
franchise, ” said Peter Greenleaf, Chairman and Chief Executive
Officer of Sucampo. “Looking forward to the remainder of 2016
and throughout 2017, we will be focused on the execution of our
base business, next steps in our phase three program for AMITIZA in
pediatric functional constipation and development of a sprinkle
formulation, and completion of strategic transactions to further
boost growth and diversify our company.”
For the three months ended September 30, 2016,
Sucampo reported year-over-year total revenue growth of 73% to
$57.9 million. Product sales revenue increased to $31.6
million, representing 186% year-over-year growth, and product
royalty revenue grew 7% year-over-year to $20.8 million. Revenue
for the quarter included an additional $13.3 million because of the
R-Tech Ueno acquisition. Excluding this additional revenue from the
acquisition, base revenue grew by 33%.
Sucampo reported a GAAP net income of $8.1
million, or $0.19 per diluted share during the third quarter of
2016 compared to GAAP net income of $7.2 million, or $0.16 per
diluted share, during the third quarter of 2015, an increase of 12%
and 19% respectively. On an adjusted basis, Sucampo reported
net income of $12.4 million, or $0.28 per diluted share, during the
third quarter of 2016, compared to net income of $7.8 million, or
$0.17 per diluted shares, during the third quarter of 2015, an
increase year-over-year of 58% and 68% respectively.
Third Quarter 2016 Operational
Review
AMITIZA
Corporate
- Sucampo Pharmaceuticals, Inc., together with certain of its
affiliates and Takeda Pharmaceutical Company Limited (Takeda) and
certain of its affiliates, have entered into a settlement and
license agreement with Dr. Reddy’s and certain of its affiliates
that resolves patent litigation in the United States related to
AMITIZA 8 mcg and 24 mcg soft gelatin capsules.Under the
terms of the settlement and license agreement, Sucampo is granting
Dr. Reddy’s a non-exclusive license to market a generic version of
lubiprostone in the United States beginning more than six years
from today’s date, or earlier under certain circumstances.
Dr. Reddy’s would pay to Sucampo a share of net profits of generic
lubiprostone products sold during the term of the agreement, which
decreases over time and ends when all of the related patents have
expired. Dr. Reddy’s may elect to purchase generic
lubiprostone products from Sucampo under the terms of a
manufacturing and supply agreement at a negotiated price.Sucampo,
Takeda and Dr. Reddy’s have agreed to dismiss with prejudice the
patent litigation filed in the U.S. District Court for the Southern
District of New Jersey.
United States
- AMITIZA total prescriptions were 374,194 in the third quarter
of 2016, as reported by IMS, a decrease of 1.4% compared to the
third quarter of 2015. For the first nine months of 2016, AMITIZA
total prescriptions were 1,103,778, an increase of 2% compared to
the first nine months of 2015. Net sales of AMITIZA,
reported by Takeda Pharmaceuticals U.S.A., Inc. (Takeda) for
royalty calculation purposes, increased 7% to $108.8 million for
the third quarter of 2016, compared to $101.7 million in the same
period of 2015. Royalty revenue was $20.8 million compared to
$19.3 million, an increase of 7%. Also included in third quarter
revenue are Takeda AMITIZA sales from R-Tech Ueno of $10.9
million.
Global Markets
- In Japan, Sucampo's revenue from sales of AMITIZA to Mylan N.V.
was $17.4 million for the third quarter of 2016, compared to $10.3
million in the same period of 2015, an increase of 69%.
Unit volume as reported by Mylan grew more than 40% through the
first nine months of 2016 compared to the first nine months of
2015, to 89.3 million units versus 62 million units in 2015.
Research and Development
- A phase 3 trial of AMITIZA in pediatric functional constipation
in children six to seventeen years of age did not achieve its
primary endpoint of overall spontaneous bowel movement (SBM)
response. However, the trial did show a trend in favor of
lubiprostone for the primary endpoint, and achieved statistical
significance in some secondary endpoints, notably overall SBM
frequency, straining, and stool consistency. In this study,
tolerability of lubiprostone was consistent with the safety profile
in adults. Sucampo will first review these results with the U.S.
Food and Drug Administration and then will announce next steps at
the completion of this review. Sucampo intends to initiate
enrollment in its clinical development program of the sprinkle
formulation of AMITZA in adults by the end of 2016 as
planned. After completion of this sprinkle formulation
program in adults, a further consultation with the FDA so as to
better determine the doses and endpoints that should be studied in
the younger pediatric population will follow, aiming at initiation
of a phase three program in children 6 months to six years of age
using the sprinkle formulation in mid 2017.
- Following a detailed review of the program, Sucampo has made
the decision to discontinue development of RTU-1096, a compound in
its vascular adhesion protein (VAP-1) inhibitor program.
Third Quarter 2016 Financial
Review
- On a GAAP basis, Sucampo reported net income of $8.1 million
and a diluted EPS of $0.19 during the third quarter of 2016,
compared to net income of $7.2 million and diluted EPS of $0.16 in
the same period in 2015. Adjusted net income was $12.4 million, or
$0.28 per diluted share, during the third quarter of 2016, compared
to net income of $7.8 million, or $0.17 per diluted
share.
- EBITDA was $35.6 million for the third quarter of 2016 compared
to EBITDA of $11.9 million for the same period in 2015, an increase
of 196%. Adjusted EBITDA, defined as net income before interest,
taxes, depreciation, amortization, stock-based compensation
expense, restructuring and intangible impairment, was $28.8 million
for the third quarter of 2016 compared to $14.6 million in the same
period in 2015, an increase of 97%.
- Total revenues were $57.9 million for the third quarter of 2016
compared to $33.4 million in the same period in 2015, an increase
of $24.4 million or 73%. The increase was primarily due to
the inclusion of R-Tech Ueno results and increased royalty related
revenues from Takeda.
- Cost of goods sold were $15.6 million for the third quarter of
2016 compared to $5.3 million for the same period in 2015, an
increase of $10.3 million or 195%. The increase was primarily
due to the inclusion of R-Tech Ueno results, acquired intangible
asset amortization and increased product sales. Excluding
intangible asset amortization of $6.7 million, cost of goods sold
was $8.9 million.
- Gross margin, calculated as product sales revenue less cost of
goods sold as a percentage of product sales revenue, was 50.6% for
the third quarter of 2016, compared to 52.0% for the same period in
2015, a decrease of 3%. The decrease was primarily due to
intangible asset amortization. Excluding the intangible asset
amortization, gross margin was 71.8%, an increase of 38%. This
increase is due to the inclusion of R-Tech Ueno results and the
realization of the economics resulting from the
acquisition.
- Research and development expenses were $10.0 million for the
third quarter of 2016 compared to $8.4 million for the same period
of 2015, an increase of $1.6 million or 19%. The increase was
primarily due to increased spending on lubiprostone pediatric
studies, as well as the inclusion of R-Tech Ueno.
- In connection with the discountinuation of the VAP-1 Inhibitor
development program, the Company has impaired the related in
process research and development assets and recognized a one time
non-cash write-down of $7.3 million in the third quarter of 2016,
compared to $0.0 for the prior year period. The Company has
adjusted for this one time charge in the results from
operations.
- General and administrative expenses were $11.1 million for the
third quarter of 2016 compared to $7.8 million for the same period
of 2015, an increase of $3.3 million or 42%. The increase was
primarily due to legal costs associated with the Dr. Reddy’s
settlement, RTU intregration costs, restructuring related costs and
the inclusion of RTU.
- Selling and marketing expenses were $0.7 million for the third
quarter of 2016 compared to $0.4 million for the same period of
2015. Fluctuation was due to the inclusion on R-Tech Ueno related
commercial activities.
- Included in other income during the quarter is a one-time gain
of $9.3 million related to the termination of a loan from the Japan
Agency for Medical Research & Development (AMED) for
development of unoprostone, which was discontinued in early
2015.
- The effective tax rate for the third quarter of 2016 was 47.8%,
compared to 37.5% in the same period of 2015. The increase in the
tax rate is primarily due to the treatment of non-U.S. income.
Certain prior year non-GAAP amounts have
been reclassified for consistency with the current period- adjusted
presentation. These reclassifications had no effect on the reported
results of operations. A reconciliation of
adjusted Net Income to GAAP Net Income and adjusted EBITDA to net
income, the most directly comparable GAAP financial measure, is
included in the tables below.
Consolidated Statements of Operations and Comprehensive
Income (unaudited) |
(in thousands,
except per share data) |
Three months ended September 30, |
|
2016 |
2015 |
Adjusted
Non-GAAP Income |
|
|
GAAP net
income |
|
8,092 |
|
|
7,205 |
|
Amortization
Intangibles |
|
6,672 |
|
|
- |
|
Intangible
Impairment |
|
7,286 |
|
|
- |
|
Legal Settlement |
|
(9,260 |
) |
|
- |
|
Restructuring
Costs |
|
208 |
|
|
- |
|
Acquisition Related
Expenses |
|
605 |
|
|
943 |
|
Amortization of
Financing Costs |
|
875 |
|
|
- |
|
Tax Effect of
Adjustments |
|
(2,107 |
) |
|
(313 |
) |
Adjusted Net
Income |
|
12,371 |
|
|
7,835 |
|
|
|
|
Adjusted Net Income Per
Share: |
|
|
Diluted |
$ |
0.28 |
|
$ |
0.17 |
|
|
|
|
|
|
|
|
2016 |
|
|
2015 |
|
EBITDA |
|
|
GAAP net
income |
|
8,092 |
|
|
7,236 |
|
Income Tax
Provision |
|
7,410 |
|
|
4,327 |
|
Interest income |
|
(31 |
) |
|
(30 |
) |
Interest payable |
|
5,899 |
|
|
243 |
|
Depreciation |
|
223 |
|
|
201 |
|
Amortization of
Acquired Intangibles |
|
6,672 |
|
|
- |
|
|
|
|
Intangible
Impairment |
|
7,286 |
|
|
- |
|
EBITDA |
|
35,551 |
|
|
11,977 |
|
Non-GAAP
Adjustments |
|
|
Share Based
Compensation Expense |
|
1,722 |
|
|
1,718 |
|
Restructuring
Costs |
|
208 |
|
|
- |
|
Acquisition Related
Expenses |
|
605 |
|
|
943 |
|
Legal settlement |
|
(9,260 |
) |
|
- |
|
Adjusted
EBITDA |
|
28,826 |
|
|
14,638 |
|
|
Cash, Cash Equivalents, Restricted Cash
and Marketable Securities
- At September 30, 2016, cash, cash equivalents, restricted cash
and investments were $153.7 million compared to $163.5 million at
December 31, 2015. This change is primarily due to payments of the
outstanding notes and related interest, offset by an increase in
cash flow from operating activities. At September 30, 2016
and December 31, 2015, notes payable were $218.7 million and $252.4
million, respectively, including current portions of $21.7 million
and $39.1 million, respectively. The change in the overall note
payable balance is due to debt repayments made during 2016.
Sucampo’s net debt position at September 30, 2016 is $65 million,
compared to $88.9 million at December 31, 2015.
Geographic Sales
- Company revenues by product type and geographic location for
the three months ended September 30, 2016 and 2015 were as
follows
|
|
|
Three months ended September 30,
2016 |
|
Three months ended September 30,
2015 |
(In
thousands) |
|
USA |
|
Japan |
|
Rest of theWorld |
|
Total |
|
USA |
|
Japan |
|
Rest of theWorld |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMITIZA Product
sales |
|
10,919 |
|
17,422 |
|
792 |
|
29,133 |
|
- |
|
10,286 |
|
- |
|
10,286 |
AMITIZA Royalty |
|
20,770 |
|
- |
|
- |
|
20,770 |
|
19,327 |
|
- |
|
- |
|
19,327 |
Rescula Product
Sales |
|
21 |
|
2,400 |
|
- |
|
2,421 |
|
736 |
|
- |
|
- |
|
736 |
Total |
|
31,710 |
|
19,822 |
|
792 |
|
52,324 |
|
20,063 |
|
10,286 |
|
- |
|
30,349 |
|
Guidance
Sucampo today raised its earnings guidance for
the full year ending December 31, 2016. Sucampo now expects total
revenue of $220.0 million to $225.0 million, adjusted net income of
$50.0 million to $55.0 million, adjusted EPS of $1.20 to $1.25, and
adjusted EBITDA of $110.0 million to $115.0 million. Adjusted net
income guidance excludes amortization of acquired intangibles of
approximately $17.6 million, restructuring related costs of $1.9
million, debt financing related costs of $3.5 million, CPP option
related expenses of $7.5 million, amortization of the remaining
inventory step-up costs of approximately $8.9 million, intangible
asset impairment expense of $7.3 million and one time gains
associated with a legal settlement of $9.3 million. Adjusted EBITDA
guidance excludes stock option related expenses of $7.3 million,
one time restructuring related costs of $1.9 million and CPP option
related expenses of $7.5 million. Guidance includes a one-time
$10.0 million milestone in the fourth quarter of 2016 related to
the achievement of sales milestone from Mylan related to sales of
AMITIZA in Japan.
See the table below for a comparison of the
Company's previous 2016 guidance to the updated 2016 guidance:
Measure |
Previous 2016 Guidance |
Updated 2016 Guidance |
Total Revenue |
$195.0 million to $205.0 million |
$220.0 million to $225.0 million |
Adjusted Net Income |
$45.0 million to $50.0 million |
$50.0 million to $55.0 million |
Adjusted EPS |
$0.97 to $1.07 |
$1.20 to $1.25 |
Adjusted EBITDA |
$100.0 million to $105.0 million |
$110.0 million to $115.0 million |
Sucampo is also providing preliminary earnings
guidance for the full year ending December 31, 2017. Sucampo
expects total revenue of $220.0 million to $230.0 million, adjusted
net income of $75.0 million to $85.0 million, and adjusted EBITDA
of $145.0 million to $155.0 million. Adjusted net income guidance
excludes amortization of acquired intangibles of approximately
$22.58 million and debt financing related costs of $3.1
million. Adjusted EBITDA guidance excludes stock option
related costs of $6.0 million.
Non-GAAP Financial Measures
This press release contains non-GAAP earnings
and adjusted EBITDA as listed in the first table above, which is
GAAP net income before interest, tax, depreciation, amortization,
stock option expense and intangible impairment. Sucampo believes
that this non-GAAP measure of financial results provides useful
information to management and investors relating to its results of
operations. Sucampo's management uses this non-GAAP measure to
compare Sucampo's performance to that of prior periods for trend
analyses, and for budgeting and planning purposes, as management
believes this provides a more comparable measure of our continuing
business, as it adjusts for special items that are not reflective
of the normal earnings of our business. Sucampo believes that the
use of non-GAAP financial measures provides an additional tool for
investors to use in evaluating ongoing operating results and trends
and in comparing the Sucampo's financial measures with other
companies in its industry, many of which present similar non-GAAP
financial measures to investors, and that it allows for greater
transparency with respect to key metrics used by management in its
financial and operational decision-making.
Adjusted EBITDA provides us with an
understanding of one aspect of earnings before the impact of
investing and financing charges, income taxes and special
items. Adjusted EBITDA may be useful to an investor in
evaluating our operating performance and liquidity because this
measure is widely used by investors to measure a company’s
operating performance without regard to items excluded from the
calculation of such measure, which can vary substantially from
company to company. In addition, this is a financial measure
that is used by rating agencies, lenders and other parties to
evaluate credit worthiness. Finally, this measure is used by
management for various purposes, including as a measure of
performance of our operating entities and as a basis for strategic
planning and forecasting.
Management of the company does not consider
non-GAAP measures in isolation or as an alternative to financial
measures determined in accordance with GAAP. The principal
limitation of non-GAAP financial measures is that they exclude
significant expenses that are required by GAAP to be recorded in
the Sucampo's financial statements. In order to compensate for
these limitations, management presents non-GAAP financial measures
together with GAAP results. Non-GAAP measures should be considered
in addition to results and guidance prepared in accordance with
GAAP, but should not be considered a substitute for, or superior
to, GAAP results. Reconciliation tables of the most comparable GAAP
financial measure to the non-GAAP financial measure used in this
press release are included with the financial tables at the end of
this release. Sucampo urges investors to review the reconciliation
and not to rely on any single financial measure to evaluate the
Sucampo's business. In addition, other companies, including
companies in our industry, may calculate similarly named non-GAAP
measures differently than we do, which limits their usefulness in
comparing our financial results with theirs.
Company to Host Conference Call
Today
Sucampo will host a conference call and webcast today,
Wednesday, November 9, 2016 at 8:30 am ET.Conference call and
Webcast participation details are as follows:Dial-in number:
888-636-8238 (domestic) or 484-747-6635 (international)Passcode:
94640075Webcast link:
http://www.sucampo.com/investors/events-presentations/
Conference call replay:Dates: Starting at 11:30 AM ET, November
9, 2016 a replay of the teleconference and webcast will be
available Dial-in number: 855-859-2056 (domestic) or 404-537-3406
(international)Passcode: 94640075Webcast link:
http://www.sucampo.com/investors/events-presentations/; then click
‘Archived Events’
About AMITIZA®
(lubiprostone)
AMITIZA (lubiprostone) is a chloride channel
activator that acts locally in the small intestine. By increasing
intestinal fluid secretion, lubiprostone increases motility in the
intestine, thereby facilitating the passage of stool and
alleviating symptoms associated with CIC. Lubiprostone, via
activation of apical CIC-2 channels in intestinal epithelial cells,
bypasses the antisecretory action of opiates that results from
suppression of secretomotor neuron excitability. Activation of
CIC-2 by lubiprostone has also been shown to stimulate recovery of
mucosal barrier function and reduce intestinal permeability via the
restoration of tight junction protein complexes in ex vivo studies
of ischemic porcine intestine.
AMITIZA (24 mcg twice daily) is indicated in the
U.S. and Israel for the treatment of adults with CIC and
opioid-induced constipation (OIC) with chronic, non-cancer pain.
AMITIZA (8 mcg twice daily) is also approved in the U.S. and Israel
for irritable bowel syndrome with constipation (IBS-C) in women 18
years of age and older. In Japan, AMITIZA (24 mcg twice daily) is
indicated for the treatment of chronic constipation (excluding
constipation caused by organic diseases). In Canada, AMITIZA (24
mcg twice daily) is indicated for the treatment of CIC in adults.
In the U.K., AMITIZA (24 mcg twice daily) is indicated for the
treatment of CIC and associated symptoms in adults, when response
to diet and other non-pharmacological measures (e.g. educational
measures, physical activity) are inappropriate. In Switzerland,
AMITIZA (24 mcg twice daily) is indicated for the treatment of CIC
in adults and for the treatment of OIC and associated signs and
symptoms such as stool consistency, straining, constipation
severity, abdominal discomfort, and abdominal bloating in adults
with chronic, non-cancer pain. The efficacy of AMITIZA for the
treatment of OIC in patients taking opioids of the diphenylheptane
class, such as methadone, has not been established.
About RESCULA®
Unoprostone isopropyl 0.12% (trade named
RESCULA) first received marketing authorization in 1994 in Japan
for the treatment of glaucoma and ocular hypertension.
RESCULA is marketed in Japan by Santen Pharmaceutical Co., Ltd.
(Santen). We acquired RESCULA as part of the acquisition of
R-Tech Ueno in 2015.
About Sucampo Pharmaceuticals,
Inc.
Sucampo Pharmaceuticals, Inc. is focused on the
development and commercialization of medicines that meet major
unmet medical needs of patients worldwide. Sucampo has two marketed
products – AMITIZA, its lead product, and RESCULA. A global
company, Sucampo is headquartered in Rockville, Maryland, and has
operations in Japan, Switzerland and the U.K. For more information,
please visit www.sucampo.com.
The Sucampo logo and the tagline, The Science of
Innovation, are registered trademarks of Sucampo AG. AMITIZA is a
registered trademark of Sucampo AG.
Follow us on Twitter (@Sucampo_Pharma). Follow
us on LinkedIn (Sucampo Pharmaceuticals).
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Sucampo Forward-Looking
Statement
This press release contains "forward-looking
statements" as that term is defined in the Private Securities
Litigation Reform Act of 1995. These statements are based on
management's current expectations and involve risks and
uncertainties, which may cause results to differ materially from
those set forth in the statements. The forward-looking statements
may include statements regarding financial results, product
development, and other statements that are not historical facts.
The following factors, among others, could cause actual results to
differ from those set forth in the forward-looking statements: the
impact of pharmaceutical industry regulation and health care
legislation; Sucampo's ability to accurately predict future market
conditions; dependence on the effectiveness of Sucampo's patents
and other protections for innovative products; the effects of
competitive products on Sucampo’s products; and the exposure to
litigation and/or regulatory actions.
No forward-looking statement can be guaranteed
and actual results may differ materially from those projected.
Sucampo undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events, or otherwise. Forward-looking statements in this
press release should be evaluated together with the many
uncertainties that affect Sucampo's business, particularly those
mentioned in the risk factors and cautionary statements in
Sucampo's most recent Form 10-K as filed with the Securities and
Exchange Commission on March 11, 2016, as amended, as well as its
filings with the Securities and Exchange Commission on Forms 8-K
and 10-Q since the filing of the Form 10-K, all of which Sucampo
incorporates by reference.
Sucampo Pharmaceuticals, Inc. |
Consolidated Statements of Operations and Comprehensive
Income (unaudited) |
(in
thousands, except per share data) |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Revenues: |
|
|
|
|
|
|
|
Product royalty revenue |
$ |
20,771 |
|
|
$ |
19,328 |
|
|
$ |
56,222 |
|
|
$ |
51,209 |
|
Product sales revenue |
|
31,554 |
|
|
|
11,022 |
|
|
|
86,538 |
|
|
|
36,678 |
|
Research and development
revenue |
|
3,172 |
|
|
|
2,714 |
|
|
|
9,971 |
|
|
|
7,468 |
|
Contract and collaboration
revenue |
|
2,376 |
|
|
|
384 |
|
|
|
4,301 |
|
|
|
2,457 |
|
Total revenues |
|
57,873 |
|
|
|
33,448 |
|
|
|
157,032 |
|
|
|
97,812 |
|
|
|
|
|
|
|
|
|
Costs and
expenses: |
|
|
|
|
|
|
|
Costs of goods sold |
|
15,586 |
|
|
|
5,286 |
|
|
|
59,278 |
|
|
|
18,656 |
|
Research and development |
|
9,976 |
|
|
|
8,368 |
|
|
|
35,580 |
|
|
|
22,285 |
|
Impairment of in-process research
and development |
|
7,286 |
|
|
|
- |
|
|
|
7,286 |
|
|
|
- |
|
General and administrative |
|
11,061 |
|
|
|
7,752 |
|
|
|
32,411 |
|
|
|
22,363 |
|
Selling and marketing |
|
696 |
|
|
|
385 |
|
|
|
2,094 |
|
|
|
1,617 |
|
Total costs and expenses |
|
44,605 |
|
|
|
21,791 |
|
|
|
136,649 |
|
|
|
64,921 |
|
|
|
|
|
|
|
|
|
Income from
operations |
|
13,268 |
|
|
|
11,657 |
|
|
|
20,383 |
|
|
|
32,891 |
|
Non-operating income
(expense): |
|
|
|
|
|
|
|
Interest income |
|
31 |
|
|
|
62 |
|
|
|
67 |
|
|
|
155 |
|
Interest expense |
|
(5,899 |
) |
|
|
(243 |
) |
|
|
(18,141 |
) |
|
|
(784 |
) |
Other income, net |
|
8,102 |
|
|
|
87 |
|
|
|
5,216 |
|
|
|
1,947 |
|
Total non-operating income
(expense), net |
|
2,234 |
|
|
|
(94 |
) |
|
|
(12,858 |
) |
|
|
1,318 |
|
|
|
|
|
|
|
|
|
Income before income
taxes |
|
15,502 |
|
|
|
11,563 |
|
|
|
7,525 |
|
|
|
34,209 |
|
Income tax
provision |
|
(7,410 |
) |
|
|
(4,327 |
) |
|
|
(4,321 |
) |
|
|
(10,989 |
) |
Net income |
$ |
8,092 |
|
|
$ |
7,236 |
|
|
$ |
3,203 |
|
|
$ |
23,220 |
|
|
|
|
|
|
|
|
|
Net income per
share: |
|
|
|
|
|
|
|
Basic |
$ |
0.19 |
|
|
$ |
0.16 |
|
|
$ |
0.08 |
|
|
$ |
0.52 |
|
Diluted |
$ |
0.19 |
|
|
$ |
0.16 |
|
|
$ |
0.07 |
|
|
$ |
0.51 |
|
Weighted average common
shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
42,813 |
|
|
|
44,731 |
|
|
|
42,704 |
|
|
|
45,576 |
|
Diluted |
|
43,443 |
|
|
|
46,309 |
|
|
|
43,334 |
|
|
|
45,939 |
|
|
|
|
|
|
|
|
|
Comprehensive
income |
|
|
|
|
|
|
|
Net income |
$ |
8,092 |
|
|
$ |
7,236 |
|
|
$ |
3,203 |
|
|
$ |
23,220 |
|
Other comprehensive
income (expense): |
|
|
|
|
|
|
|
Unrealized gain on pension benefit
obligation |
|
12 |
|
|
|
57 |
|
|
|
37 |
|
|
|
38 |
|
Unrealized gain (loss) on
investments, net of tax effect |
|
- |
|
|
|
(6 |
) |
|
|
- |
|
|
|
6 |
|
Foreign currency translation
gain |
|
4,635 |
|
|
|
264 |
|
|
|
40,890 |
|
|
|
102 |
|
Comprehensive income |
$ |
12,739 |
|
|
$ |
7,551 |
|
|
$ |
44,130 |
|
|
$ |
23,366 |
|
|
Sucampo Pharmaceuticals, Inc. |
Consolidated Balance Sheets (unaudited) |
(in
thousands, except share and per share data) |
|
September 30, |
|
December 31, |
|
2016 |
|
2015 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
128,465 |
|
|
$ |
108,284 |
|
Product royalties receivable |
|
20,771 |
|
|
|
22,792 |
|
Accounts receivable, net |
|
20,684 |
|
|
|
22,759 |
|
Restricted cash |
|
25,213 |
|
|
|
55,218 |
|
Inventories |
|
24,202 |
|
|
|
33,121 |
|
Prepaid expenses and other current
assets |
|
18,146 |
|
|
|
9,186 |
|
Total current assets |
|
237,481 |
|
|
|
251,360 |
|
Property and equipment,
net |
|
6,563 |
|
|
|
6,393 |
|
Intangible assets |
|
134,886 |
|
|
|
130,315 |
|
Goodwill |
|
73,022 |
|
|
|
60,937 |
|
In-process research and
development |
|
- |
|
|
|
6,171 |
|
Deferred charge,
non-current |
|
1,400 |
|
|
|
1,400 |
|
Convertible note
receivable |
|
5,182 |
|
|
|
- |
|
Other assets |
|
1,030 |
|
|
|
605 |
|
Total assets |
$ |
459,564 |
|
|
$ |
457,181 |
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts payable |
$ |
7,869 |
|
|
$ |
11,213 |
|
Accrued expenses |
|
14,380 |
|
|
|
10,886 |
|
Collaboration obligation |
|
1,438 |
|
|
|
5,623 |
|
Income tax payable |
|
16,587 |
|
|
|
6,507 |
|
Notes payable, current |
|
21,730 |
|
|
|
39,083 |
|
Other current liabilities |
|
4,805 |
|
|
|
14,815 |
|
Total current liabilities |
|
66,809 |
|
|
|
88,127 |
|
|
|
|
|
Notes payable,
non-current |
|
196,984 |
|
|
|
213,277 |
|
Deferred revenue,
non-current |
|
913 |
|
|
|
1,088 |
|
Deferred tax liability,
net |
|
41,757 |
|
|
|
52,497 |
|
Other liabilities |
|
8,291 |
|
|
|
15,743 |
|
Total liabilities |
|
314,754 |
|
|
|
370,732 |
|
|
|
|
|
|
|
|
|
Preferred stock, $0.01
par value; 5,000,000 shares authorized at September 30, 2016 and
December 31, 2015; no shares issued and outstanding at September
30, 2016 and December 31, 2015 |
|
- |
|
|
|
- |
|
Class A common stock,
$0.01 par value; 270,000,000 shares authorized at September 30,
2016 and December 31, 2015; 45,828,775 and 45,509,150 shares issued
and outstanding at September 30, 2016 and December 31, 2015,
respectively |
|
458 |
|
|
|
455 |
|
Class B common stock,
$0.01 par value; 75,000,000 shares authorized at September 30, 2016
and December 31, 2015; no shares issued and outstanding at
September 30, 2016 and December 31, 2015 |
|
- |
|
|
|
- |
|
Additional paid-in
capital |
|
113,440 |
|
|
|
99,212 |
|
Accumulated other
comprehensive income |
|
54,339 |
|
|
|
13,412 |
|
Treasury stock, at
cost; 3,009,942 shares at September 30, 2016 and December 31,
2015 |
|
(46,269 |
) |
|
|
(46,269 |
) |
Retained earnings |
|
22,842 |
|
|
|
19,639 |
|
Total stockholders' equity |
|
144,810 |
|
|
|
86,449 |
|
Total liabilities and stockholders'
equity |
$ |
459,564 |
|
|
$ |
457,181 |
|
Contact:
Sucampo Pharmaceuticals, Inc.
Silvia Taylor
Senior Vice President, Investor Relations and Corporate Affairs
1-240-223-3718
staylor@sucampo.com
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