Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN), a specialty
pharmaceutical company focused on developing and commercializing
products for the treatment of central nervous system (CNS)
diseases, today reported financial results for first quarter 2017
and associated company developments.
Commercial Update
First quarter 2017 product prescriptions for Trokendi XR® and
Oxtellar XR®, as reported by IMS, totaled 134,855, a 17.1% increase
over the first quarter of 2016.
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Prescriptions |
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Q1 2017 |
|
Q1 2016 |
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Change % |
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Trokendi XR |
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101,695 |
|
86,227 |
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17.9 |
% |
Oxtellar XR |
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33,160 |
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28,913 |
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14.7 |
% |
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Total |
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134,855 |
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115,140 |
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17.1 |
% |
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Source: IMS |
Net product sales for the first quarter of 2017 were $56.4
million, a 31.2% increase over $43.0 million in the same period the
prior year.
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Net Product Sales ($mil.) |
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Q1 2017 |
|
Q1 2016 |
|
Change % |
|
|
|
|
|
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Trokendi XR |
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$42.0 |
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$32.3 |
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30.0 |
% |
Oxtellar XR |
|
$14.4 |
|
$10.7 |
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34.6 |
% |
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Total |
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$56.4 |
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$43.0 |
|
31.2 |
% |
Consistent with historical patterns, product prescriptions and
net product sales for the first quarter of 2017 for Trokendi XR and
Oxtellar XR were impacted by the continued shift of patients to
high deductible and high co-pay plans. Lower wholesaler and
pharmacy inventory levels during the first quarter of 2017,
compared to the fourth quarter of 2016, had the effect of reducing
net product sales by approximately $5 million in the first quarter
of 2017.
Trokendi XR Migraine Launch
After receiving final approval from the Food and Drug
Administration (FDA) in April 2017, the Company launched Trokendi
XR as a new treatment for prophylaxis of migraine headache in
adults and adolescents 12 years and older.
While it is still early in the launch, for the first three weeks
post launch, IMS prescription data for Trokendi XR show a strong
upward trend in total and new prescriptions. During the three week
period post launch, total prescriptions were 26,472 compared to
24,109 in the three weeks prior to launch, representing a 10%
increase. Similarly, for the same three week period post launch,
new prescriptions were 12,978 compared to 10,898 in the three weeks
prior to launch, representing a 19% increase. Consistent with these
early data, feedback from our sales force indicates that physicians
are very receptive to the new indication and appreciate the unique
benefits that Trokendi XR brings to migraine patients.
“We are excited about the launch of Trokendi XR in migraine, and
are very encouraged by the early IMS prescription data. We continue
to believe that the migraine indication should allow us to realize
the full potential of Trokendi XR,” said Jack Khattar, President
and CEO of Supernus Pharmaceuticals. "Trokendi XR, with its novel
formulation, provides full 24 hour coverage for patients with
smooth pharmacokinetics compared to immediate-release topiramate
products, making it an important new prophylactic treatment option
for adult and adolescent patients suffering from migraine
headache.”
Progress of Product Pipeline
Enrollment continues in both Phase III trials for SPN-810,
currently in development for Impulsive Aggression in patients aged
6 to 12 years who have ADHD. Protocol revisions to improve patient
retention during the screening period and programs to drive patient
enrollment for the Phase III trials are having a positive impact.
We expect enrollment to continue through 2017.
Regarding SPN-812, currently in development for patients aged 6
to 12 years with ADHD, the Company continues to plan to initiate
Phase III clinical testing during the second half of 2017. The
Company is on track to meet with the FDA in the second quarter of
2017 for an end-of-Phase II meeting.
“We look forward to discussing further with the FDA our Phase
IIb clinical trial results and the design of our Phase III program
for SPN-812,” said Jack Khattar. “We remain focused on advancing
SPN-812 as a novel highly effective and well tolerated
non-stimulant for the treatment of ADHD.”
Operating Expenses
Research and development expenses in the first quarter of 2017
were $9.6 million, as compared to $10.6 million in the same quarter
last year. This decrease is primarily due to the completion of
enrollment in the Phase IIb trial for SPN-812, which occurred in
the third quarter of 2016.
Selling, general and administrative expenses in the first
quarter of 2017 were $28.2 million, as compared to $25.2 million in
the same quarter last year. The increase is due to marketing
program development, sample production, and other activities
related to preparing for the launch of the migraine headache
indication for Trokendi XR, which occurred in April 2017.
Operating Income and Earnings Per Share
Operating income in the first quarter of 2017 was $16.8 million,
a 160.8% increase over $6.4 million in the same period the prior
year. This improvement in operating income is primarily due to
increased net product sales.
Diluted earnings per share for the first quarter of 2017 were
$0.19 compared to $0.08 in the same period last year, an increase
of 138% over the prior year. Diluted earnings per share for the
first quarter of 2017 includes an effective tax rate of 36.5%, as
compared to an effective tax rate of 4.0% during the first quarter
of 2016.
Weighted-average diluted common shares outstanding were
approximately 52.8 million in the first quarter of 2017, as
compared to approximately 51.2 million in the same period the prior
year.
Capital Resources
As of March 31, 2017, the Company had $176.3 million in cash,
cash equivalents, marketable securities, and long term marketable
securities, as compared to $165.5 million at December 31, 2016.
As of May 8, 2017, approximately $1.6 million of the
Company’s six year, $90 million notes remain outstanding. During
the second quarter of 2017, the Company initiated the process of
calling the remaining outstanding principal balance of its six year
notes and expects that process to be completed in the quarter.
Financial Guidance
For full year 2017, the Company reiterates its expectation for
net product sales, R&D expenses and operating income as set
forth below:
- Net product sales in the range of $265 million to $275
million.
- Research and development expense of approximately $55
million.
- Operating income in the range of $75 million to $80 million.
Full year 2017 operating income includes approximately $5 million
of non-cash royalty revenue.
Conference Call Details
The Company will hold a conference call hosted by Jack Khattar,
President and Chief Executive Officer, and Greg Patrick, Vice
President and Chief Financial Officer, to discuss these results at
9:00 a.m. ET, on Wednesday, May 10, 2017. An accompanying webcast
also will be provided.
Please refer to the information below for conference call
dial-in information and webcast registration. Callers should dial
in approximately 10 minutes prior to the start of the call.
Conference
dial-in: |
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(877)
288-1043 |
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International
dial-in: |
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(970)
315-0267 |
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Conference ID: |
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9981751 |
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Conference Call
Name: |
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Supernus
Pharmaceuticals First Quarter 2017 Earnings Conference Call |
Following the live call, a replay will be available on the
Company's website, www.supernus.com, under ‘Investors’.
About Supernus Pharmaceuticals, Inc.
Supernus Pharmaceuticals, Inc. is a specialty pharmaceutical
company focused on developing and commercializing products for the
treatment of central nervous system diseases. The Company currently
markets Trokendi XR® (extended-release topiramate) for treatment of
migraine and epilepsy and Oxtellar XR® (extended-release
oxcarbazepine) for treatment of epilepsy. The Company is also
developing several product candidates to address large market
opportunities in psychiatry, including SPN-810 for the treatment of
Impulsive Aggression in ADHD patients and SPN-812 for the treatment
of ADHD.
Forward-Looking Statements:
This press release includes forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements do not convey historical information, but
relate to predicted or potential future events that are based upon
management's current expectations. These statements are subject to
risks and uncertainties that could cause actual results to differ
materially from those expressed or implied by such statements. In
addition to the factors mentioned in this press release, such risks
and uncertainties include, but are not limited to, the Company’s
ability to sustain and increase its profitability; the Company’s
ability to raise sufficient capital to fully implement its
corporate strategy; the implementation of the Company’s corporate
strategy; the Company’s future financial performance and projected
expenditures; the Company’s ability to increase the number of
prescriptions written for each of its products; the Company’s
ability to increase its net revenue; the Company’s ability to enter
into future collaborations with pharmaceutical companies and
academic institutions or to obtain funding from government
agencies; the Company’s product research and development
activities, including the timing and progress of the Company’s
clinical trials, and projected expenditures; the Company’s ability
to receive, and the timing of any receipt of, regulatory approvals
to develop and commercialize the Company’s product candidates; the
Company’s ability to protect its intellectual property and operate
its business without infringing upon the intellectual property
rights of others; the Company’s expectations regarding federal,
state and foreign regulatory requirements; the therapeutic
benefits, effectiveness and safety of the Company’s product
candidates; the accuracy of the Company’s estimates of the size and
characteristics of the markets that may be addressed by its product
candidates; the Company’s ability to increase its manufacturing
capabilities for its products and product candidates; the Company’s
projected markets and growth in markets; the Company’s product
formulations and patient needs and potential funding sources; the
Company’s staffing needs; and other risk factors set forth from
time to time in the Company’s SEC filings made pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934, as amended. The
Company undertakes no obligation to update the information in this
press release to reflect events or circumstances after the date
hereof or to reflect the occurrence of anticipated or unanticipated
events.
Supernus Pharmaceuticals, Inc. |
Consolidated Balance Sheets |
(in thousands) |
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|
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March 31, 2017 |
|
December 31, 2016 |
|
|
(unaudited) |
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|
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Cash, cash equivalents
and marketable securities |
|
$ |
87,132 |
|
$ |
90,121 |
Accounts receivable,
net |
|
|
38,885 |
|
|
41,527 |
Inventories, net |
|
|
19,167 |
|
|
16,801 |
Prepaid expenses and
other current assets |
|
|
4,573 |
|
|
2,955 |
Total
current assets |
|
|
149,757 |
|
|
151,404 |
|
|
|
|
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|
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Long term marketable
securities |
|
|
89,163 |
|
|
75,410 |
Property and equipment,
net |
|
|
4,342 |
|
|
4,344 |
Deferred legal
fees |
|
|
11,331 |
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|
19,860 |
Intangible assets,
net |
|
|
29,450 |
|
|
16,490 |
Other non-current
assets |
|
|
350 |
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|
331 |
Deferred income
tax |
|
|
37,863 |
|
|
41,729 |
|
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Total assets |
|
$ |
322,256 |
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$ |
309,568 |
|
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Accounts payable |
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$ |
5,056 |
|
$ |
8,055 |
Accrued sales
deductions |
|
|
43,450 |
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|
41,943 |
Accrued expenses |
|
|
26,890 |
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|
27,427 |
Accrued income taxes
payable |
|
|
1,675 |
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7 |
Non-recourse liability
related to sale of future royalties, current portion |
|
|
4,645 |
|
|
3,101 |
Deferred licensing
revenue |
|
|
287 |
|
|
209 |
Total
current liabilities |
|
|
82,003 |
|
|
80,742 |
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|
|
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|
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Deferred licensing
revenue, net of current portion |
|
|
1,365 |
|
|
1,501 |
Convertible notes,
net |
|
|
3,310 |
|
|
4,165 |
Non-recourse liability
related to sale of future royalties, long term |
|
|
25,555 |
|
|
27,289 |
Other non-current
liabilities |
|
|
3,936 |
|
|
4,002 |
Derivative
liabilities |
|
|
23 |
|
|
114 |
Total liabilities |
|
|
116,192 |
|
|
117,813 |
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Total stockholders'
equity |
|
|
206,064 |
|
|
191,755 |
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Total liabilities and
stockholders' equity |
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$ |
322,256 |
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$ |
309,568 |
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Supernus Pharmaceuticals, Inc. |
Consolidated Statements of Operations |
(in thousands, except share and per share
data) |
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Three Months Ended March 31, |
|
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2017 |
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2016 |
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(unaudited) |
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Revenue |
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Net
product sales |
|
$ |
56,369 |
|
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$ |
43,025 |
|
Royalty
revenue |
|
|
1,149 |
|
|
|
1,119 |
|
Licensing
revenue |
|
|
58 |
|
|
|
50 |
|
|
|
|
|
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Total
revenue |
|
|
57,576 |
|
|
|
44,194 |
|
|
|
|
|
|
|
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Costs and expenses |
|
|
|
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|
|
Cost of
product sales |
|
|
2,949 |
|
|
|
2,035 |
|
Research
and development |
|
|
9,601 |
|
|
|
10,562 |
|
Selling,
general and administrative |
|
|
28,238 |
|
|
|
25,160 |
|
|
|
|
|
|
|
|
Total costs and
expenses |
|
|
40,788 |
|
|
|
37,757 |
|
|
|
|
|
|
|
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Operating income |
|
|
16,788 |
|
|
|
6,437 |
|
Other income
(expense) |
|
|
|
|
|
|
Interest
income |
|
|
531 |
|
|
|
327 |
|
Interest
expense |
|
|
(90 |
) |
|
|
(179 |
) |
Interest
expense-nonrecourse |
|
|
|
|
|
|
liability
related to sale of future royalties |
|
|
(959 |
) |
|
|
(1,279 |
) |
Changes
in fair value of derivative liabilities |
|
|
54 |
|
|
|
101 |
|
Loss on
extinguishment of debt |
|
|
(101 |
) |
|
|
(382 |
) |
|
|
|
|
|
|
|
Total other
expense |
|
|
(565 |
) |
|
|
(1,412 |
) |
|
|
|
|
|
|
|
Earnings before income
taxes |
|
|
16,223 |
|
|
|
5,025 |
|
|
|
|
|
|
|
|
Income
tax expense |
|
|
5,926 |
|
|
|
200 |
|
|
|
|
|
|
|
|
Net income |
|
$ |
10,297 |
|
|
$ |
4,825 |
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
Income per common
share: |
|
|
|
|
|
|
Basic |
|
$ |
0.21 |
|
|
$ |
0.10 |
|
Diluted |
|
$ |
0.19 |
|
|
$ |
0.08 |
|
|
|
|
|
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|
Weighted-average number
of common shares outstanding: |
|
|
|
|
|
|
Basic |
|
|
50,158,634 |
|
|
|
49,240,099 |
|
Diluted |
|
|
52,764,442 |
|
|
|
51,152,072 |
|
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|
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|
CONTACTS:
Jack A. Khattar, President and CEO
Gregory S. Patrick, Vice President and CFO
Supernus Pharmaceuticals, Inc.
Tel: (301) 838-2591
or
INVESTOR CONTACT:
Peter Vozzo
Westwicke Partners
Office: (443) 213-0505
Mobile: (443) 377-4767
Email: peter.vozzo@westwicke.com
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