TherapeuticsMD Announces Full Year 2022 Financial Results and Provides Update on Business Model Transition
April 07 2023 - 4:01PM
Business Wire
TherapeuticsMD, Inc. (“TherapeuticsMD” or the “Company”)
(NASDAQ: TXMD), a company that owns rights to pharmaceutical
royalties, today reported financial results for the full year ended
December 31, 2022.
“As a result of the transaction with Mayne Pharma Group Limited
(ASX: MYX) (“Mayne Pharma”) that closed at year-end, in which
TherapeuticsMD granted Mayne Pharma an exclusive license to
commercialize TherapeuticsMD’s products in the United States, we
repaid our debt, redeemed our outstanding preferred stock,
eliminated our commercial and manufacturing infrastructure, and
downsized our remaining operations,” said Marlan D. Walker, Chief
Executive Officer of TherapeuticsMD. “We look forward to continuing
to streamline our operations as we complete the transition to a
virtual business model that collects royalties from Mayne Pharma
and our other licensees. We also intend to explore other strategic
pathways to create value for TherapeuticsMD shareholders,” said Mr.
Walker.
Net Income (Loss) from Continuing Operations
- Net income from continuing operations was $1.1 million for the
year ended December 31, 2022, or $0.12 per basic share, compared to
a net loss of $79.3 million, or $9.96 per basic share, for 2021.
The increase in net income was a result of an increase in license
revenue due to the Mayne Pharma transaction.
License Revenues from Continuing Operations
- License revenues from continuing operations, which are revenues
from continuing operations related to license agreements, were
$70.0 million for the year ended December 31, 2022, compared to
$2.6 million for 2021. The increase in license revenues was a
result of the allocation of the initial upfront payment and
guaranteed minimum royalties from Mayne Pharma.
Total Operating Expenses from Continuing Operations
- Total operating expenses from continuing operations for 2022
were $67.4 million compared to $80.7 million for 2021. Total
operating expenses from continuing operations for 2022 included
$9.5 million of restructuring expenses.
Discontinued Operations
- Discontinued operations, which include the Company’s commercial
operations related to the sale of ANNOVERA®, IMVEXXY®, BIJUVA®, and
prescription prenatal vitamin products sold under the BocaGreenMD®
and vitaMedMD® brands, which are now licensed to Mayne Pharma,
resulted in product revenues of $80.7 million for the year ended
December 31, 2022, compared to $84.4 million for the same period in
2021. Net income from discontinued operations was $110.9 million
for the year ended December 31, 2022, compared to a net loss of
$93.1 million for 2021.
Balance Sheet
- As of December 31, 2022, the Company’s cash on hand totaled
$38.1 million compared with $64.9 million as of December 31,
2021.
- As of December 31, 2022, the Company had no indebtedness for
borrowed money, compared to $188.3 million as of December 31,
2021.
Full Year 2022 Financial Results
Corporate Updates
In connection with the previously announced transaction with
Mayne Pharma, TherapeuticsMD has significantly reduced its
operating expenses. The termination of certain members of the
Company’s executive management team and all other employees was
completed by December 31, 2022. Severance obligations for all
employees other than executive officers were paid in full during
the first quarter of 2023, and severance obligations for terminated
executive officers will be paid in accordance with their employment
agreements and separation agreements as previously disclosed. As of
December 31, 2022, the Company employed one full-time employee
primarily engaged in an executive position. The Company engaged
external consultants, including certain former members of its
management team, to support TXMD’s relationship with current
partners and assist with certain financial, legal, and regulatory
matters, and the continued wind-down of historical business
operations.
Total consideration paid to TherapeuticsMD for the transaction
with Mayne Pharma that closed on December 30, 2022, included an
upfront cash payment of $140.0 million for the license grant and
sale of certain assets, plus an additional approximately $13.1
million for the acquisition of net working capital and prepaid
royalties, which is subject to customary adjustments. In addition,
TherapeuticsMD is eligible to receive up to $30.0 million in
milestone payments as well as royalties on net sales of between
7.5% and 8.0%, for a period of 20 years, with minimum annual
royalties of $3.0 million per year for 12 years, adjusted for
inflation at an annual rate of 3%, subject to certain further
adjustments. The approximately $1.0 million in prepaid royalties
paid at closing will reduce the first four quarterly royalty
payments that would have otherwise been payable to
TherapeuticsMD.
The Company used a portion of the proceeds to repay all
obligations under the Company’s Financing Agreement with Sixth
Street Specialty Lending, Inc. In addition, the Company also
redeemed all 29,000 outstanding shares of its Series A Preferred
Stock at a purchase price of $1,333 per share and paid certain
affiliates of Rubric Capital Management LP (“Rubric”) approximately
$3.0 million as a make-whole payment pursuant to the subscription
agreements previously entered into between the Company and
Rubric.
Forward-Looking Statements
This press release by TherapeuticsMD, Inc. may contain
forward-looking statements. Forward-looking statements may include,
but are not limited to, statements relating to TherapeuticsMD’s
objectives, plans and strategies as well as statements, other than
historical facts, that address activities, events or developments
that the company intends, expects, projects, believes or
anticipates will or may occur in the future. These statements are
often characterized by terminology such as “believes,” “hopes,”
“may,” “anticipates,” “should,” “intends,” “plans,” “will,”
“expects,” “estimates,” “projects,” “positioned,” “strategy” and
similar expressions and are based on assumptions and assessments
made in light of management’s experience and perception of
historical trends, current conditions, expected future developments
and other factors believed to be appropriate. Forward-looking
statements in this press release are made as of the date of this
press release, and the company undertakes no duty to update or
revise any such statements, whether as a result of new information,
future events or otherwise. Forward-looking statements are not
guarantees of future performance and are subject to risks and
uncertainties, many of which are outside of the company’s control.
Important factors that could cause actual results, developments and
business decisions to differ materially from forward-looking
statements are described in the sections titled “Risk Factors” 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, as well as reports on Form 8-K, and include
the following: whether Mayne Pharma will be successful at
commercializing the products that it licensed and acquired from
TherapeuticsMD; whether the company is successful in winding down
its operations and the costs associated therewith, including the
company’s ability to obtain any additional financing necessary
therefor and the any adjustments to the net working capital
purchased as part of the Mayne Pharma transaction; whether the
company is successful in identifying strategic pathways to create
additional shareholder value; the company’s ability to remain
listed on Nasdaq; the impact of product liability lawsuits; the
impact of leadership transitions; and the volatility of the trading
price of the company’s common stock.
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version on businesswire.com: https://www.businesswire.com/news/home/20230407005027/en/
Marlan D. Walker Chief Executive Officer 561-961-1900
Lisa M. Wilson In-Site Communications, Inc. 212-452-2793
lwilson@insitecony.com
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