-- First quarter 2021 net revenues of $54.5
million; net income of $0.1 million and diluted earnings per share
of $0.01 --
-- First quarter adjusted non-GAAP EBITDA of
$18.9 million and adjusted non-GAAP diluted earnings per share of
$1.04 --
-- Cortrophin® Gel sNDA re-filing on track for
Q2 2021 submission --
-- Strengthened R&D engine and enhanced
generics and CDMO business through pending acquisition of Novitium
Pharma--
-- Expanded branded products portfolio through
April 1 acquisition of Sandoz Inc. NDAs --
-- Strengthened leadership team through key
appointments --
ANI Pharmaceuticals, Inc. (“ANI” or the “Company”)
(NASDAQ: ANIP) today announced business highlights and financial
results for the three months ended March 31, 2021.
First Quarter and Recent Business Highlights:
- Continued efforts to assemble a robust re-filing package for
Cortrophin® Gel in preparation for second-quarter 2021 submission
to the U.S. Food and Drug Administration (“FDA”).
- Signed a definitive agreement to acquire Novitium Pharma LLC
(“Novitium”), a privately held, New Jersey-based high-growth
pharmaceutical company. The transaction is expected to close in the
second half of this year, pending Federal Trade Commission (“FTC”)
clearance and shareholder approval of the equity issuances for the
transaction. Upon close, Novitium will diversify ANI’s commercial
portfolio, add a proven best-in-class R&D engine, enhance our
North American manufacturing footprint, and yield compelling
financial benefits.
- Acquired the new drug applications (“NDAs”) for OXISTAT®
Lotion, VEREGEN® Ointment, and Pandel® Cream and the abbreviated
new drug application (“ANDA”) for ApexiCon® E Cream from Sandoz
Inc. Collectively, these dermatology products generated net
revenues of $13.2 million in 2020. Strengthened leadership team
with the addition of key pharmaceutical executives: Christopher K.
Mutz as Chief Commercial Officer and Head of Rare Diseases and Ori
Gutwerg as Senior Vice President of Generics.
- Received inaugural ratings from the two major rating agencies,
Moody’s and S&P. Moody’s assigned a B2 rating with a stable
outlook, and S&P Global Ratings assigned a B+ rating with a
positive outlook.
First Quarter 2021 Financial Highlights:
- Net revenues were $54.5 million compared to $49.8 million in Q1
2020.
- GAAP net income was $0.1 million, and diluted GAAP earnings per
share was $0.01.
- Adjusted non-GAAP EBITDA was $18.9 million.
- Adjusted non-GAAP diluted earnings per share was $1.04.
Cash and cash equivalents were $25.1 million, net accounts
receivable was $91.9 million, and face value of debt was $184.6
million as of March 31, 2021.
“During the first quarter, we made excellent progress on our
stated goal of building a sustainable biopharma company well
positioned for growth and serving patients in need. Our dedicated
Cortrophin technical team is finalizing our sNDA file for
resubmission, and Chris has made strong additions to the commercial
team to ensure that we are prepared for a successful launch. The
pending Novitium acquisition and product acquisitions from Sandoz
represent significant steps toward our goals and are aligned with
our four pillars for accelerating growth. Since we signed the
Novitium deal in March, Novitium has launched several products,
including limited competition opportunities such as Gx Famotidine
solution, and continues to build momentum in advance of officially
joining the ANI family. At the same time, our operational and
commercial teams have seamlessly transitioned the Sandoz product
assets into the ANI portfolio,” stated Nikhil Lalwani, President
and CEO.
“Similar to many of our industry peers, we have seen a
combination of pandemic-related and seasonal factors that have
contributed to softness in prescription levels. Despite these
challenges, we are at an inflection point, and I believe that the
Novitium transaction and sizable market opportunity for Cortrophin
have the potential to be transformational for ANI. We remain
focused on the work to be done to unlock value for all of our
stakeholders and to continue to serve patients in need,” concluded
Lalwani.
“We continue to make good progress on our Term Loan B in support
of the Novitium transaction, and receiving our inaugural ratings
from Moody’s and S&P represents another milestone in the
maturation of the Company,” stated Stephen Carey, CFO.
First Quarter 2021 Financial Results
Net Revenues
(in thousands)
Three Months Ended March March
31,
2021
2020
Generic pharmaceutical products
$
32,988
$
37,495
Branded pharmaceutical products
7,517
9,157
Contract manufacturing
2,573
1,974
Royalty and other income
11,443
1,148
Total net revenues
$
54,521
$
49,774
Net revenues for generic pharmaceutical products were $33.0
million during the three months ended March 31, 2021, a decrease of
12.0% compared to $37.5 million for the same period in 2020. Based
upon an analysis of IQVIA/IMS data, during the three months ended
March 31, 2021, the total market for generic prescriptions in the
United States declined approximately 9% when compared to the three
months ended March 31, 2020. We believe that this overall decline
in prescription activity is principally due to the COVID-19
pandemic, and it negatively impacted the market for many of our
generic pharmaceutical products. From a product perspective, the
net decrease was driven by declines in sales of Ezetimibe
Simvastatin, Methazolamide, Miglustat, and Diphenoxylate, somewhat
tempered by increased revenues from sales of Paliperidone ER and
Erythromycin Ethylsuccinate (“EES”).
Net revenues for branded pharmaceutical products were $7.5
million during the three months ended March 31, 2021, a decrease of
17.9% compared to $9.2 million for the same period in 2020. The
decrease primarily reflects lower unit sales of Inderal XL and
InnoPran XL, tempered by increased sales of Casodex and Inderal
LA.
Contract manufacturing revenues were $2.6 million during the
three months ended March 31, 2021, an increase of 30.3% compared to
$2.0 million for the same period in 2020, due to an increased
volume of orders from contract manufacturing customers in the
period.
Royalty and other revenues were $11.4 million during the three
months ended March 31, 2021, an increase of $10.3 million from $1.1
million for the same period in 2020, primarily due to the
recognition of royalties due ANI for patent rights related to Kite
Pharma, Inc.’s oncology product, YESCARTA®.
Operating expenses decreased to $51.5 million for the three
months ended March 31, 2021, from $57.6 million in the prior year
period.
Cost of sales, excluding depreciation and amortization,
decreased by $1.8 million to $20.0 million in the first quarter of
2021, primarily as a result of the non-recurrence of $2.7 million
in cost of sales representing the excess of fair value over cost
for inventory acquired in the Amerigen acquisition and subsequently
sold during the three months ended March 31, 2020.
Research and development expenses decreased to $3.0 million in
the first quarter of 2021, a decrease of 53.2% from $6.3 million in
the first quarter of 2020, primarily due to the non-recurrence of
the $3.8 million in-process research and development expense from
the Amerigen acquisition in the first quarter 2020.
Selling, general and administrative expenses rose by $3.9
million in the first quarter of 2021 to $17.6 million compared to
$13.7 million in the comparable quarter in 2020. The increase
primarily reflects $2.9 million of transaction expenses related to
the pending Novitium acquisition incurred during the three months
ended March 31, 2021, increased pharmacovigilance compliance costs
in continued support of the expansion of our commercial portfolio,
and increased legal, insurance, and other professional fees.
Depreciation and amortization decreased by $0.3 million in the
first quarter of 2021 to $10.9 million compared to $11.2 million in
the comparable quarter in 2020.
Net income for the first quarter of 2021 was $0.1 million as
compared to net loss of $7.0 million in the prior year period.
Diluted earnings per share for the three months ended March 31,
2021 was $0.01, compared to diluted loss per share of $0.59 in the
prior year period.
Adjusted non-GAAP diluted earnings per share was $1.04 in the
first quarter of 2021 and 2020.
For reconciliations of adjusted non-GAAP EBITDA and adjusted
non-GAAP diluted earnings per share to the most directly comparable
GAAP financial measure, please see Table 3 and Table 4,
respectively.
Liquidity
As of March 31, 2021, the Company had $25.1 million in
unrestricted cash and cash equivalents plus $91.9 million in net
accounts receivable. The Company had $184.6 million (face value) in
outstanding debt as of March 31, 2021.
Conference Call
As previously announced, ANI Pharmaceuticals management will
host its first quarter 2021 conference call as follows:
Date
Friday, May 7, 2021
Time
8:30 a.m. ET
Toll free (U.S.)
(866) 518-6930
Webcast (live and replay)
www.anipharmaceuticals.com, under the
“Investors” section
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 800-934-5153 and entering access code 5412658.
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 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,
expense from acquired in-process research and development, Novitium
transaction expenses, Cortrophin pre-launch charges, asset
impairments, 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.
Adjusted non-GAAP Net Income
ANI’s management considers adjusted non-GAAP net 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 pre-launch charges, acquired in-process research and
development (“IPR&D”) expense, Novitium transaction expenses,
asset impairments, and certain other items that vary in frequency
and impact on ANI’s results of operations. Management uses adjusted
non-GAAP net income when analyzing Company performance.
Adjusted non-GAAP net income is defined as net 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,
expense from acquired in-process research and development,
Cortrophin pre-launch charges, asset impairments, 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 income should be considered in
addition to, but not in lieu of, net income reported under GAAP. A
reconciliation of adjusted non-GAAP net income to the most directly
comparable GAAP financial measure is provided below.
Adjusted non-GAAP Diluted Earnings per Share
ANI’s management considers adjusted non-GAAP diluted 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 pre-launch charges, acquired IPR&D expense, Novitium
transaction expenses, asset impairments, and certain other items
that vary in frequency and impact on ANI’s results of operations.
Management uses adjusted non-GAAP diluted earnings per share when
analyzing Company performance.
Adjusted non-GAAP diluted earnings per share is defined as
adjusted non-GAAP net 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
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 earnings per share to
the most directly comparable GAAP financial measure is provided
below.
About ANI
ANI Pharmaceuticals, Inc. is an integrated specialty
pharmaceutical company focused on delivering value to our customers
by developing, manufacturing, and marketing high quality branded
and generic prescription pharmaceuticals. We focus on niche and
high barrier to entry opportunities including controlled
substances, oncology products (anti-cancer), hormones and steroids,
and complex formulations. For more information, please visit our
website www.anipharmaceuticals.com.
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 about the Company’s corporate strategy, the pending
acquisition of Novitium and anticipated benefits and results of
such acquisition, future operations, products, financial position,
operating results and prospects, including plans for growth, the
Company’s pipeline or potential markets therefor, plans for
existing ANDAs, timing for resubmission of a sNDA for Cortrophin
Gel and commercialization plans, 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 risk that the Company may not be able
to obtain the requisite approvals or satisfy other closing
conditions to complete the Novitium acquisition, 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; 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 U.S. Food and Drug
Administration; general business and economic conditions, including
the ongoing impact of the COVID-19 pandemic; market trends for our
products; regulatory environment and changes; and regulatory and
other approvals relating to product development and
manufacturing.
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 Securities and Exchange Commission,
including its most recent Annual Report on Form 10-K and quarterly
reports on Form 10-Q. All forward-looking statements in this news
release speak only as of the date of this news release and are
based on the Company’s current beliefs, assumptions, and
expectations. Except as required by law, the Company undertakes no
obligation to update or revise any forward-looking statement,
whether as a result of new information, future events or
otherwise.
Additional Information about the Proposed Novitium
Transaction and Where to Find It
In connection with the proposed acquisition of Novitium (the
“Merger”) and the issuances of equity contemplated thereby and in
the accompanying PIPE transaction (collectively, the “Proposed
Transactions”) described in a separate press release issued today
and related SEC filing, the Company has filed a proxy statement on
Schedule 14A with the SEC to obtain the approval of ANI
shareholders for such equity issuances as required by the Nasdaq
listing standards. Additionally, the Company plans to file other
relevant materials with the SEC in connection with the Proposed
Transactions. This release is not a substitute for the proxy
statement or any other document relating to the Proposed
Transactions which the Company may file with the SEC. The
definitive proxy statement has been sent or given to the
stockholders of the Company and contains important information
about the Proposed Transactions. INVESTORS IN AND SECURITY HOLDERS
OF THE COMPANY ARE URGED TO READ THE PROXY STATEMENT AND ANY OTHER
RELEVANT DOCUMENTS THAT HAVE BEEN FILED OR FURNISHED OR WILL BE
FILED OR WILL BE FURNISHED WITH THE SEC, AS WELL AS ANY AMENDMENTS
OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY
BEFORE MAKING ANY VOTING OR INVESTMENT DECISION WITH RESPECT TO THE
PROPOSED TRANSACTIONS BECAUSE THEY CONTAIN OR WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE MERGER, RELATED MATTERS AND THE
PARTIES TO THE MERGER. The materials filed by the Company with the
SEC may be obtained free of charge at the SEC’s website at
www.sec.gov or by contacting the investor relations department of
the Company.
Participants in the Solicitation
This press release does not constitute a solicitation of a proxy
from any stockholder with respect to the Proposed Transactions.
However, the Company and its directors and executive officers may
be deemed to be participants in the solicitation of proxies from
Company stockholders in connection with the Proposed Transactions.
Investors and security holders may obtain more detailed information
regarding the names, affiliations and interests of the Company’s
executive officers and directors in the solicitation by reading the
Company’s Annual Report on Form 10-K for the fiscal year ended
March 31, 2020, the Company’s definitive proxy statement on
Schedule 14A for the 2021 Annual Meeting of Stockholders and the
other relevant materials filed with the SEC in connection with the
Proposed Transactions. Additional information concerning the
interests of the Company’s participants in the solicitation, which
may, in some cases, be different than those of the Company’s
stockholders generally, is set forth in the proxy statement
relating to the Proposed Transactions. You may obtain free copies
of these documents as described in the preceding paragraph filed,
with or furnished to the SEC. All such documents, when filed or
furnished, are available free of charge at the SEC’s website at
www.sec.gov or by contacting the investor relations department of
the Company.
Financial Tables Follow
ANI Pharmaceuticals, Inc. and Subsidiaries Table
1: US GAAP Statement of Operations (unaudited, in thousands,
except per share amounts)
Three Months Ended March
31,
2021
2020
Net Revenues
$
54,521
$
49,774
Operating Expenses: Cost of sales (excl. depreciation and
amortization)
19,985
21,804
Research and development
2,968
6,344
Selling, general, and administrative
17,587
13,683
Depreciation and amortization
10,898
11,183
Cortrophin pre-launch charges
38
4,602
Total Operating Expenses
51,476
57,616
Operating Income/(Loss)
3,045
(7,842
)
Other Expense, Net Interest expense, net
(2,454
)
(2,032
)
Other (expense)/income, net
(515
)
10
Income/(Loss) Before Benefit for Income Taxes
76
(9,864
)
Benefit for income taxes
10
2,853
Net Income/(Loss)
$
86
$
(7,011
)
Earnings/(Loss) Per Share Basic Earnings/(Loss) Per
Share
$
0.01
$
(0.59
)
Diluted Earnings/(Loss) Per Share
$
0.01
$
(0.59
)
Basic Weighted-Average Shares Outstanding
12,004
11,902
Diluted Weighted-Average Shares Outstanding
12,017
11,902
ANI Pharmaceuticals, Inc. and Subsidiaries Table
2: US GAAP Balance Sheets (uaudited, in thousands)
March 31,2021 December 31,2020 Current Assets
Cash and cash equivalents
$
25,073
$
7,864
Accounts receivable, net
91,876
95,793
Inventories, net
59,927
60,803
Prepaid expenses and other current assets
5,922
5,861
Total Current Assets
182,798
170,321
Property and equipment
59,541
58,797
Accumulated depreciation
(18,774
)
(17,528
)
Property and equipment, net
40,767
41,269
Restricted cash
5,000
5,003
Deferred tax assets, net of deferred tax liabilities and valuation
allowance
52,006
51,704
Intangible assets, net
178,859
188,511
Goodwill
3,580
3,580
Other non-current assets
833
802
Total Assets
$
463,843
$
461,190
Current Liabilities Current debt, net of deferred financing
costs
$
14,438
$
13,243
Accounts payable
13,769
11,261
Accrued expenses and other
2,381
2,456
Accrued royalties
5,310
6,407
Accrued compensation and related expenses
5,533
6,231
Current income taxes payable, net
3,659
3,906
Accrued government rebates
8,672
7,826
Returned goods reserve
28,944
27,155
Deferred revenue
62
80
Total Current Liabilities
82,768
78,565
Non-current debt, net of deferred financing costs and
current borrowing component
168,985
172,443
Derivatives and other non-current liabilities
8,378
14,482
Total Liabilities
260,131
265,490
Stockholders' Equity Common stock
1
1
Treasury stock
(2,594
)
(2,246
)
Additional paid-in capital
216,223
214,354
Accumulated deficit
(4,886
)
(4,972
)
Accumulated other comprehensive loss, net of tax
(5,032
)
(11,437
)
Total Stockholders' Equity
203,712
195,700
Total Liabilities and Stockholders' Equity
$
463,843
$
461,190
ANI Pharmaceuticals, Inc. and
Subsidiaries
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 March
31,
Three Months Ended March
31,
Three Months Ended March
31,
Three Months Ended March
31,
2021
2020
2021
2020
2021
2020
2021
2020
Net Income/(Loss)
$
86
$
(7,011
)
As reported:
$
19,985
$
21,804
$
17,587
$
13,683
$
2,968
$
6,344
Add/(Subtract): Interest expense, net
2,454
2,032
Other expense/(income), net
515
(10
)
Benefit for income taxes
(10
)
(2,853
)
Depreciation and amortization
10,898
11,183
Cortrophin pre-launch charges and sales & marketing expenses
141
4,602
(103
)
Stock-based compensation
1,869
2,424
(4
)
(30
)
(1,746
)
(2,199
)
(119
)
(195
)
Acquired IPR&D expense
-
3,784
(3,784
)
Asset impairments(1)
-
752
(700
)
(52
)
Excess of fair value over cost of acquired inventory
-
2,651
(2,651
)
Novitium transaction expenses
2,943
-
(2,943
)
Adjusted non-GAAP EBITDA
$
18,896
$
17,554
As adjusted:
$
19,981
$
18,423
$
12,795
$
11,432
$
2,849
$
2,365
(1) Asset Impairments comprised of finished goods inventory reserve
for Bretylium and accounts receivable reserve due to customer
bankruptcy, tempered by modest recovery of previously reserved
inventory related to market exits.
ANI Pharmaceuticals,
Inc. and Subsidiaries Table 4: Adjusted non-GAAP Net Income
and Adjusted non-GAAP Diluted Earnings per Share Reconciliation
(unaudited, in thousands, except per share amounts)
Three
Months Ended March 31,
2021
2020
Net Income/(Loss)
$
86
$
(7,011
)
Add/(Subtract): Non-cash interest expense
546
157
Depreciation and amortization expense
10,898
11,183
Cortrophin pre-launch charges and sales & marketing expenses
141
4,602
Acquired IPR&D expense
-
3,784
Stock-based compensation
1,869
2,424
Excess of fair value over cost of acquired inventory
-
2,651
Asset Impairments(1)
-
752
Novitium transaction expenses
2,943
-
Less: Estimated tax impact of adjustments (calc. at 24%)
(3,935
)
(6,133
)
Adjusted non-GAAP Net Income
$
12,548
$
12,409
Diluted Weighted-Average Shares Outstanding
12,017
11,902
Adjusted Diluted Weighted-Average Shares Outstanding
12,017
11,945
Adjusted non-GAAP Diluted Earnings per Share
$
1.04
$
1.04
(1) Asset Impairments comprised of finished goods inventory
reserve for Bretylium and accounts receivable reserve due to
customer bankruptcy, tempered by modest recovery of previously
reserved inventory related to market exits.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210507005105/en/
Investor Relations: Lisa M. Wilson, In-Site Communications, Inc.
T: 212-452-2793 E: lwilson@insitecony.com
ANI Pharmaceuticals (NASDAQ:ANIP)
Historical Stock Chart
From Mar 2024 to Apr 2024
ANI Pharmaceuticals (NASDAQ:ANIP)
Historical Stock Chart
From Apr 2023 to Apr 2024