CINGAL Drives Strong International
Viscosupplement Revenue Growth
Achieves Solid Bottom Line Performance with
$0.53 Diluted EPS
Anika Therapeutics, Inc. (NASDAQ: ANIK), a global, integrated
orthopedic and regenerative medicines company specializing in
therapeutics based on its proprietary hyaluronic acid (“HA”)
technology, today reported financial results for the third quarter
ended September 30, 2018, and provided an update on its business
progress in the period.
“Anika delivered solid financial results in the third quarter,
while continuing to take important steps to accelerate revenue
growth in 2019 and beyond,” said Joseph Darling, President and
Chief Executive Officer of Anika Therapeutics. “We are encouraged
by the continued advances we are making across our deep pipeline
and diverse commercial portfolio. During the quarter, CINGAL end
user demand in Canada and Europe remained strong, and we were
pleased to add four new distribution partners to further expand our
commercial reach in Europe, Asia and South America. Focused
international expansion efforts enabled us to realize a 31%
year-over-year increase in international Viscosupplement revenue
while we continued to generate strong earnings and cash flow. As we
prepare to discuss the pathway for U.S. regulatory approval for
CINGAL with the U.S. Food and Drug Administration in the first
quarter of 2019, we believe Anika is well-positioned to transform
into a global commercial company increasingly capable of generating
significant value for our patients and shareholders.”
Third Quarter Financial Results
- Total revenue for the third quarter of
2018 was $26.8 million, compared to $27.2 million for the third
quarter of 2017. The year-over-year decline was due primarily to
the impact from the voluntary recall of HYALOFAST, HYALOGRAFT-C,
and HYALOMATRIX announced in May 2018.
- Global Viscosupplement revenue
increased 2% year-over-year for the third quarter of 2018, while
international Viscosupplement revenue increased 31% during the same
period. The increases were primarily due to the growth of CINGAL in
international markets, as well as the continued global expansion of
Viscosupplement products overall.
- Total operating expenses for the third
quarter of 2018 were $18.2 million, compared to $16.9 million for
the third quarter of 2017. The increase in total operating expenses
was due primarily to higher production costs and increased
personnel and professional costs.
- Net income for the third quarter of
2018 increased to $7.6 million, or $0.53 per diluted share,
compared to $6.9 million, or $0.46 per diluted share, for the third
quarter of 2017. The increase in net income was due primarily to
the reduction in R&D expenses as a result of the completion of
the CINGAL 16-02 study and lower income tax expenses in 2018.
Recent Business Highlights
- Continued to work with external
regulatory and legal experts to seek regulatory approval of CINGAL
in the U.S. market. Anika plans to meet with the U.S. Food and Drug
Administration (FDA) in the first quarter of 2019 and is developing
multiple strategies to enable the company to move forward
expeditiously once it has received guidance from the FDA regarding
the pathway for CINGAL.
- Advanced the Company’s product pipeline
with the completion of preclinical development activities for its
regenerative therapy for rotator cuff repair.
- Strengthened Anika’s international
product distribution network and expanded the Company’s commercial
reach with four new distribution partners in Europe, Asia and South
America.
- Continued to evaluate potential
partnership opportunities for the Company’s expansive product
pipeline as part of the ongoing work on its 5-year strategic
plan.
- Convened an international distributor
meeting at the Company’s European headquarters to align key growth
objectives and market approach strategies for 2019.
- Appointed Cheryl Blanchard, Ph.D., and
Susan Vogt as new independent members of the Company’s Board of
Directors.
Full Year 2018 Revised Corporate OutlookBased on
currently available information, the Company anticipates full year
product revenue to be approximately 3% below prior year. The
Company continues to expect that it will resume the shipment of
products that were the subject of the previously-disclosed
voluntary recall by the end of this year. Total operating expenses
are now expected to be reduced to the high $80 million range for
the full year of 2018 as a result of successful cost control
initiatives.
Conference Call InformationAnika’s management will hold a
conference call and webcast to discuss its financial results and
business highlights today, Wednesday, October 24 at 5:00 pm ET. The
conference call can be accessed by dialing 1-855-468-0611
(toll-free domestic) or 1-484-756-4332 (international). A live
audio webcast will be available in the "Investor Relations" section
of Anika’s website, www.anikatherapeutics.com. An accompanying
slide presentation may also be accessed via the Anika website. A
replay of the webcast will be available on Anika’s website
approximately two hours after the completion of the event.
About Anika Therapeutics, Inc.Anika Therapeutics, Inc.
(NASDAQ: ANIK) is a global, integrated orthopedic and regenerative
medicines company based in Bedford, Massachusetts. Anika is
committed to improving the lives of patients with degenerative
orthopedic diseases and traumatic conditions with clinically
meaningful therapies along the continuum of care, from palliative
pain management to regenerative tissue repair. The Company has over
two decades of global expertise developing, manufacturing, and
commercializing more than 20 products based on its proprietary
hyaluronic acid (HA) technology. Anika's orthopedic medicine
portfolio includes ORTHOVISC®, MONOVISC®, and CINGAL®, which
alleviate pain and restore joint function by replenishing depleted
HA, and HYALOFAST, a solid HA-based scaffold to aid cartilage
repair and regeneration. For more information about Anika, please
visit www.anikatherapeutics.com.
Forward-Looking StatementsThe statements made in the last
sentence of the second paragraph of this press release and in the
Section captioned “Full Year 2018 Corporate Outlook,” which are not
statements of historical fact, are forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. These statements include, but are not limited to, those
relating to the Company’s expected meeting with the U.S. Food and
Drug Administration during the first quarter of 2019, the Company’s
full-year 2018 product revenue and operating expense projections,
and the Company’s expectations related to shipment of products
previously subject to the voluntary recall. These statements are
based upon the current beliefs and expectations of the Company’s
management and are subject to significant risks, uncertainties, and
other factors. The Company’s actual results could differ materially
from any anticipated future results, performance, or achievements
described in the forward-looking statements as a result of a number
of factors including, but not limited to, (i) the Company’s ability
to successfully commence and/or complete clinical trials of its
products on a timely basis or at all; (ii) the Company’s ability to
obtain pre-clinical or clinical data to support domestic and
international pre-market approval applications, 510(k)
applications, or new drug applications, or to timely file and
receive FDA or other regulatory approvals or clearances of its
products; (iii) that such approvals will not be obtained in a
timely manner or without the need for additional clinical trials,
other testing or regulatory submissions, as applicable; (iv) the
Company’s research and product development efforts and their
relative success, including whether we have any meaningful sales of
any new products resulting from such efforts; (v) the cost
effectiveness and efficiency of the Company’s clinical studies,
manufacturing operations, and production planning; (vi) the
strength of the economies in which the Company operates or will be
operating, as well as the political stability of any of those
geographic areas; (vii) future determinations by the Company to
allocate resources to products and in directions not presently
contemplated; (viii) the Company’s ability to successfully
commercialize its products, in the U.S. and abroad; (ix) the
Company’s ability to provide an adequate and timely supply of its
products to its customers; and (x) the Company’s ability to achieve
its growth targets. Additional factors and risks are described in
the Company’s periodic reports filed with the Securities and
Exchange Commission, and they are available on the SEC’s website at
www.sec.gov. Forward-looking statements are made based on
information available to the Company on the date of this press
release, and the Company assumes no obligation to update the
information contained in this press release.
Anika
Therapeutics, Inc. and SubsidiariesConsolidated Statements
of Operations(in thousands, except per share
data)(unaudited)
For the Three Months Ended September
30, For the Nine Months Ended September 30, 2018
2017 2018 2017 Product revenue $ 26,781 $
27,178 $ 78,581 $ 78,899 Licensing, milestone and contract revenue
6 6 18 5,133 Total revenue 26,787
27,184 78,599 84,032 Operating expenses: Cost of product
revenue 8,282 6,250 24,279 18,648 Research and development 4,232
5,842 14,126 14,521 Selling, general and administrative
5,700 4,823 28,207 14,862 Total operating
expenses 18,214 16,915 66,612 48,031
Income from operations 8,573 10,269 11,987 36,001 Interest and
other income, net 522 261 907 335
Income before income taxes 9,095 10,530 12,894 36,336 Provision for
income taxes 1,496 3,643 1,890 12,587
Net income $ 7,599 $ 6,887 $ 11,004 $ 23,749 Basic net
income per share: Net income $ 0.53 $ 0.47 $ 0.76 $ 1.63 Basic
weighted average common shares outstanding 14,237 14,579 14,524
14,572 Diluted net income per share: Net income $ 0.53 $ 0.46 $
0.74 $ 1.58 Diluted weighted average common shares outstanding
14,377 15,115 14,820 15,065
Anika Therapeutics,
Inc. and SubsidiariesConsolidated Balance Sheets(in
thousands, except per share data)(unaudited)
ASSETS September 30,2018
December 31,2017 Current assets: Cash, cash
equivalents and investments $ 149,011 $ 157,256 Accounts
receivable, net 20,771 23,825 Inventories, net 23,828 22,035
Prepaid expenses and other current assets 1,981
3,211 Total current assets 195,591 206,327 Property
and equipment, net 55,041 56,183
Other long-term assets
1,109 1,254 Intangible assets, net 9,564 10,635 Goodwill
7,959 8,218 Total assets $ 269,264 $
282,617
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities: Accounts payable $ 2,462 $ 6,747 Accrued
expenses and other current liabilities 6,843
6,326 Total current liabilities 9,305
13,073 Other long-term liabilities 574 660 Deferred tax
liability 4,120 5,393 Commitments and contingencies Stockholders’
equity: Preferred stock, $0.01 par value - - Common stock, $0.01
par value 142 147 Additional paid-in-capital 49,836 68,617
Accumulated other comprehensive loss (5,228 ) (4,784 ) Retained
earnings 210,515 199,511 Total
stockholders’ equity 255,265 263,491
Total liabilities and stockholders’ equity $ 269,264 $
282,617
Anika Therapeutics, Inc. and
SubsidiariesSupplemental Financial Data
Revenue by Product Line and Product Gross
Margin(in thousands, except percentages)(unaudited)
For the Three Months Ended September 30, For the
Nine Months Ended September 30, Product Line:
2018 % 2017
% 2018 % 2017
% Orthobiologics $ 24,097 90 % $ 23,990 88 % $ 69,778
88 % $ 68,686 87 % Surgical 1,191 4 % 1,765 7 % 3,700 5 % 4,395 6 %
Dermal 80 1 % 358 1 % 163 1 % 1,235 2 % Other 1,413
5 % 1,065 4 % 4,940
6 % 4,583 5 % Product Revenue $ 26,781
100 % $ 27,178 100 % $ 78,581
100 % $ 78,899 100 % Product Gross
Profit $ 18,499 $ 20,928 $ 54,302 $ 60,251 Product Gross Margin 69%
77% 69% 76%
Product Revenue by Geographic Region(in
thousands, except percentages)(unaudited)
For the Three Months Ended September 30, For the
Nine Months Ended September 30, 2018
% 2017 % 2018
% 2017 %
Geographic
Region: United States $ 21,695 81 % $ 22,227 82 % $ 63,377 81 %
$ 63,507 81 % Europe 3,132 12 % 2,832 10 % 9,021 11 % 9,743 12 %
Other 1,954 7 % 2,119 8 %
6,183 8 % 5,649 7 % Product Revenue $
26,781 100 % $ 27,178 100
% $ 78,581 100 % $ 78,899
100 %
View source
version on businesswire.com: https://www.businesswire.com/news/home/20181024005631/en/
Anika Therapeutics, Inc.Joseph Darling, 781-457-9000President
& CEOorSylvia Cheung, 781-457-9000CFO
Anika Therapeutics (NASDAQ:ANIK)
Historical Stock Chart
From Mar 2024 to Apr 2024
Anika Therapeutics (NASDAQ:ANIK)
Historical Stock Chart
From Apr 2023 to Apr 2024