Neos Therapeutics Reports Fourth Quarter and Full Year 2016 Financial Results
March 14 2017 - 7:00AM
Neos Therapeutics, Inc. (NASDAQ:NEOS), a pharmaceutical company
focused on developing, manufacturing and commercializing innovative
extended-release (XR) products using its proprietary
modified-release drug delivery and orally disintegrating tablet
(ODT) technology platforms, today reported financial results for
the fourth quarter and full year ended December 31, 2016 and
provided a business update.
“The strong prescription growth of Adzenys
XR-ODT speaks to the growing demand for this first ever extended
release ODT treatment option for patients with ADHD, and the
success of our launch. Some encouraging trends include
approximately 75% of all new prescriptions are coming from patient
switches from another ADHD medication and we are seeing utilization
across the spectrum of ADHD patients, from pediatric to adolescents
and adults,” said Vipin K. Garg, Ph.D., President and CEO of Neos
Therapeutics. “We are pleased to have recently completed a
successful public offering and believe that these additional funds
will be instrumental as we prepare for the potential launch of two
additional patient-friendly ADHD products in the second half of
this year. If approved, Cotempla XR-ODT, our methylphenidate XR-ODT
and NT-0201, our amphetamine oral suspension will be launched
utilizing our existing sales force and commercial infrastructure
and will complement Adzenys XR-ODT. We have a PDUFA goal date of
June 19, 2017 for Cotempla XR-ODT and a PDUFA goal date of
September 15, 2017 for NT-0201.”
Adzenys XR-ODT™ Commercial
Highlights
- Since the launch in May 2016 through December 31, 2016, the
cumulative total number of prescriptions filled for Adzenys XR-ODT,
as reported by IMS, were 30,339, including 20,330 for the three
months ended December 2016. Monthly prescriptions increased
approximately 20% per month during the three months ended December
31, 2016.
- Through March 3, 2017, the cumulative total number of
prescriptions filled for Adzenys XR-ODT, as reported by IMS, were
49,630.
- The number of prescribers of Adzenys XR-ODT continued to grow
since launch and as of December 31, 2016, 4,038 health care
providers had written prescriptions for the product. As of February
17, 2017, that number had increased to 5,132.
- Patients switching from another ADHD medication accounted for
approximately 75% of all new Adzenys XR-ODT prescriptions, as
reported by IMS as of week ended February 24, 2017.
- As of the week ended February 24, 2017, as reported by IMS, 63%
of all new Adzenys XR-ODT prescriptions were for pediatric patients
and 37% were for adult patients, indicating a broad appeal of
Adzenys XR-ODT in all patient types.
- As of March 2017, new-to-market blocks have now been lifted by
all of the major commercial accounts for Adzenys XR-ODT.
Key Recent Accomplishments and
Anticipated Milestones for 2017
- In February 2017, the Company announced the pricing of an
underwritten public offering of 5,000,000 shares of its common
stock at a public offering price of $5.00 per share, before
underwriting discounts and commissions. The underwriters for this
offering elected to exercise in full their option to purchase an
additional 750,000 shares of common stock at the public offering
price, less the underwriting discounts and commissions. Net
proceeds from this offering were approximately $26.8 million.
- In February 2017, the Company closed on a capital lease line of
up to $5 million to finance its capital expenditures for the 2017
fiscal year.
- In December 2016, Neos resubmitted a New Drug Application (NDA)
for Cotempla XR-ODT, the Company’s methylphenidate extended-release
ODT product, following the completion of a bioequivalence bridging
study. The Prescription Drug User Fee Act (PDUFA) goal date is June
19, 2017. If approved, the Company anticipates a launch in the fall
of 2017.
- In November 2016, the Company submitted a NDA for NT-0201, the
Company’s amphetamine XR liquid suspension. The PDUFA date for this
product candidate is September 15, 2017. If approved, the Company
anticipates a launch in the fourth quarter of 2017.
Select Financial Results for the Fourth
Quarter Ended December 31, 2016
- Total product revenues were $3.5 million for the three months
ended December 31, 2016, compared to $1.7 million for the same
period in 2015. This includes product revenue associated with
dispensed patient prescriptions of Adzenys XR-ODT of $2.2 million
and $1.3 million of product revenue for generic Tussionex.
- Cost of goods sold for the three months ended December 31, 2016
was $4.0 million, compared to $1.8 million for the same period of
2015. The increase was due to the product and production
costs associated with the Company’s products.
- Research and development expenses for the three months ended
December 31, 2016 were $3.6 million, compared to $2.7 million for
the same period in 2015.
- Selling and marketing expenses were $9.7 million for the three
months ended December 31, 2016, compared to $3.3 million for the
same period in 2015. The increased expense was due to
commercial sales organization and other selling costs associated
with the commercialization of Adzenys XR-ODT.
- General and administrative expenses for the three months ended
December 31, 2016 were $3.0 million, compared to $2.2 million for
the same period in 2015. The increase was principally due to costs
associated with operating as a public company.
- The Company reported a net loss of $18.4 million in the three
months ended December 31, 2016, compared to $9.1 million for the
same period in 2015.
Select Financial Results for the Fiscal
Year Ended December 31, 2016
- Total product revenues were $9.2 million for the year ended
December 31, 2016, an increase of $5.4 million or 141.4% from $3.8
million for the year ended December 31, 2015. Included in
product revenues is $2.9 million of net sales of dispensed patient
prescriptions of Adzenys XR-ODT, which was launched May 16,
2016.
- Cost of goods sold were $11.4 million for the year ended
December 31, 2016, an increase of approximately $5.5 million or
92.9% from $5.9 million for the year ended December 31, 2015. The
increase was primarily due to product and production costs
associated with increased unit sales of the Company’s products as
well as product and regulatory fees associated with Adzenys
XR-ODT.
- Research and development expenses were $12.2 million for the
year ended December 31, 2016, an increase of approximately $0.5
million or 4.4%, from the $11.7 million for the year ended December
31, 2015. This increase was primarily due to increased costs of
clinical studies for the Company’s product candidates, partially
offset by a net decrease in FDA filing fees.
- Selling and marketing expenses were $49.3 million for the year
ended December 31, 2016, an increase of approximately $43.6 million
or 769.0%, from the $5.7 million for the year ended December 31,
2015. The increase was due to commercial sales organization,
marketing and advertising, training and patient assistance program
administrative costs associated with the launch and
commercialization of Adzenys XR-ODT.
- General and administrative expenses were $12.6 million for the
year ended December 31, 2016, an increase of $5.5 million or 78.4%,
from the $7.1 million for the year ended December 31, 2015. The
increase was principally due to a full year of costs associated
with operating as a public company as well as a $1.3 million
increase in compensation related to share-based payments.
- The Company reported a net loss of $83.3 million in the year
ended December 31, 2016, compared to $30.8 million for the same
period in 2015.
- At December 31, 2016, the Company’s cash, cash equivalents and
short-term investments amounted to $39.8 million.
Conference Call Details Neos
management will host a conference call and live audio webcast to
discuss results and provide a company update at 8:30 a.m. ET 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 78990180. 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/.
About Neos Therapeutics
Neos Therapeutics, Inc. is a pharmaceutical
company focused on developing, manufacturing and commercializing
products utilizing its proprietary modified-release drug delivery
technology platforms. Adzenys XR-ODTTM, indicated for the treatment
of ADHD in patients 6 years of age and older, is the first approved
product using the Company’s extended-release (XR)-orally
disintegrating tablet (ODT) technology platform. Neos, which is
initially focusing on the treatment of ADHD, has filed New Drug
Applications with the U.S. Food and Drug Administration for two
other branded product candidates that are XR medications in ODT or
oral suspension dosage forms. In addition, Neos manufactures and
markets its generic equivalent of the branded product Tussionex®,
an XR oral suspension of hydrocodone and chlorpheniramine indicated
for the relief of cough and upper respiratory symptoms of a
cold.1
1Tussionex® is a registered trademark of
the UCB Group of Companies.
Forward-Looking Statements This
press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of
1995, including statements concerning the commercialization of
Adzenys XR-ODTTM, the regulatory submissions, including PDUFA
review periods and approvals, marketing plans and timing and the
therapeutic potential of Cotempla XR-ODT and NT-0201.
Forward-looking statements generally relate to future events or our
future financial or operating performance. In some cases, you can
identify forward-looking statements because they contain words such
as “may,” “will,” “should,” “expects,” “plans,” “anticipates,”
“could,” “intends,” “target,” “projects,” “contemplates,”
“believes,” “estimates,” “predicts,” “potential” or “continue” or
the negative of these words or other similar terms or expressions
that concern our expectations, strategy, plans or intentions. These
forward-looking statements reflect our current views about our
expectations, strategy, plans, prospects or intentions, which are
based on the information currently available to us and on
assumptions we have made. Although we believe that our plans,
intentions, expectations, strategies and prospects as reflected in
or suggested by those forward-looking statements are reasonable, we
can give no assurance that the plans, intentions, expectations or
strategies will be attained or achieved. Furthermore, actual
results may differ materially from those described in the
forward-looking statements and will be affected by a variety of
risks and factors that are beyond our control including, without
limitation, our ability to successfully obtain regulatory approval
of our Cotempla XR-ODT and NT-0201 product candidates, the
timing of such approval, our ability to market and sell our
product candidates and other risks set forth under the
caption “Risk Factors” in our most recently filed Annual Report on
Form 10-K as updated by our subsequently filed
other SEC filings, including our Quarterly
Report(s) on Form 10-Q. We assume no obligation to update
any forward-looking statements contained in this document as a
result of new information, future events or otherwise.
Neos Therapeutics, Inc. and
Subsidiaries |
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) |
|
|
|
|
|
|
|
|
|
|
In
thousands, except share and per share data |
|
December 31, 2016 |
|
|
|
December 31, 2015 |
ASSETS |
|
|
|
|
|
|
Current Assets: |
|
|
|
|
|
|
Cash and
cash equivalents |
$ |
24,352 |
|
|
$ |
90,763 |
|
|
Short-term investments |
|
15,430 |
|
|
|
- |
|
|
Accounts
receivable, net of allowances of $950 and $1,039, respectively |
|
6,135 |
|
|
|
3,903 |
|
|
Inventories |
|
5,767 |
|
|
|
2,520 |
|
|
Deferred
contract sales organization fees |
|
720 |
|
|
|
- |
|
|
Other
current assets |
|
2,865 |
|
|
|
1,058 |
|
|
Total current assets |
|
55,269 |
|
|
|
98,244 |
|
|
Property and equipment,
net |
|
7,076 |
|
|
|
5,124 |
|
|
Intangible assets,
net |
|
15,579 |
|
|
|
16,672 |
|
|
Other assets |
|
2,218 |
|
|
|
2,470 |
|
|
Total assets |
$ |
80,142 |
|
|
$ |
122,510 |
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY (DEFICIT) |
|
|
|
|
|
|
Current
Liabilities: |
|
|
|
|
|
|
Accounts
payable |
$ |
7,798 |
|
|
$ |
4,824 |
|
|
Accrued
expenses |
|
5,264 |
|
|
|
3,141 |
|
|
Deferred
revenue |
|
3,662 |
|
|
|
- |
|
|
Current
portion of long-term debt |
|
4,921 |
|
|
|
7,973 |
|
|
Total current liabilities |
|
21,645 |
|
|
|
15,938 |
|
|
Long-Term
Liabilities: |
|
|
|
|
|
|
Long-term debt,
net of current portion |
|
58,599 |
|
|
|
26,271 |
|
|
Earnout
liability |
|
232 |
|
|
|
214 |
|
|
Deferred
gain on leaseback |
|
40 |
|
|
|
547 |
|
|
Deferred
rent |
|
1,174 |
|
|
|
1,166 |
|
|
Total long-term liabilities |
|
60,045 |
|
|
|
28,198 |
|
|
Stockholders' Equity
(Deficit): |
|
|
|
|
|
|
Preferred stock, $0.001 par value, 5,000,000 shares authorized, no
shares issued or outstanding at December 31, 2016 and December 31,
2015 |
|
- |
|
|
|
- |
|
|
Common
stock, $0.001 par value, 100,000,000 authorized at December
31, 2016 and December 31, 2015; 16,079,902 and 16,060,996
issued and outstanding at December 31, 2016
respectively; 16,025,155 and 16,015,958 issued and outstanding at
December 31, 2015, respectively |
|
16 |
|
|
|
16 |
|
|
Treasury
stock, at cost, 18,906 shares at December 31 2016; 9,197
shares at December 31, 2015 |
|
(232 |
) |
|
|
(171 |
) |
|
Additional
paid-in capital |
|
198,787 |
|
|
|
195,314 |
|
|
Accumulated
deficit |
|
(200,118 |
) |
|
|
(116,785 |
) |
|
Accumulated
other comprehensive loss |
|
(1 |
) |
|
|
- |
|
|
Total stockholders' equity
(deficit) |
|
(1,548 |
) |
|
|
78,374 |
|
|
Total liabilities and stockholders’ equity
(deficit) |
$ |
80,142 |
|
|
$ |
122,510 |
|
|
|
|
|
|
|
|
|
Neos Therapeutics, Inc. and
Subsidiaries |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) |
|
|
|
For the Three Months Ended December
31, |
|
|
Year Ended
December 31, |
|
In
thousands, except share and per share amounts |
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
|
2015 |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
product sales |
|
$ |
3,503 |
|
|
$ |
1,659 |
|
|
$ |
9,154 |
|
|
|
$ |
3,792 |
|
|
Cost of goods sold |
|
|
4,019 |
|
|
|
1,842 |
|
|
|
11,437 |
|
|
|
|
5,929 |
|
|
Gross loss |
|
|
(516 |
) |
|
|
(183 |
) |
|
|
(2,283 |
) |
|
|
|
(2,137 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development |
|
|
3,603 |
|
|
|
2,743 |
|
|
|
12,207 |
|
|
|
|
11,691 |
|
|
Selling and marketing
expenses |
|
|
9,661 |
|
|
|
3,302 |
|
|
|
49,291 |
|
|
|
|
5,672 |
|
|
General and
administrative expenses |
|
|
3,025 |
|
|
|
2,187 |
|
|
|
12,625 |
|
|
|
|
7,078 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(16,805 |
) |
|
|
(8,415 |
) |
|
|
(76,406 |
) |
|
|
|
(26,578 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(2,191 |
) |
|
|
(1,036 |
) |
|
|
(6,937 |
) |
|
|
|
(3,721 |
) |
|
Loss on debt
extinguishment |
|
|
- |
|
|
|
- |
|
|
|
(1,187 |
) |
|
|
|
- |
|
|
Other income, net |
|
|
499 |
|
|
|
208 |
|
|
|
1,215 |
|
|
|
|
831 |
|
|
Change in fair value of
earnout and warrant liabilities |
|
|
123 |
|
|
|
139 |
|
|
|
(18 |
) |
|
|
|
(1,313 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss |
|
$ |
(18,374 |
) |
|
$ |
(9,104 |
) |
|
$ |
(83,333 |
) |
|
|
$ |
(30,781 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock
accretion to redemption value |
|
|
- |
|
|
|
|
- |
|
|
- |
|
|
|
|
(1,169 |
) |
|
Preferred stock
dividends |
|
|
- |
|
|
|
|
- |
|
|
- |
|
|
|
|
(1,221 |
) |
|
Net loss attributable to common stock |
|
$ |
(18,374 |
) |
|
$ |
(9,104 |
) |
|
$ |
(83,333 |
) |
|
|
$ |
(33,171 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares outstanding used to compute net loss per share, basic and
diluted |
|
|
16,062,285 |
|
|
|
15,933,315 |
|
|
|
16,052,390 |
|
|
|
|
7,581,881 |
|
|
Net loss per
share of common stock, basic and diluted |
|
$ |
(1.14 |
) |
|
$ |
(0.57 |
) |
|
$ |
(5.19 |
) |
|
|
$ |
(4.38 |
) |
|
Contacts:
Richard Eisenstadt
Chief Financial Officer
Neos Therapeutics
(972) 408-1389
reisenstadt@neostx.com
Sarah McCabe
Stern Investor Relations, Inc.
(212) 362-1200
sarah@sternir.com
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