Eton Pharmaceuticals, Inc (“Eton” or “the Company”) (Nasdaq: ETON),
an innovative pharmaceutical company focused on developing and
commercializing treatments for rare diseases, today reported
financial results for the quarter ended March 31, 2023.
“We are pleased to announce exceptional first quarter results.
ALKINDI SPRINKLE® and Carglumic Acid both delivered record revenue
and tremendous growth, aided by the onboarding of our newly
expanded sales force. Both products are positioned for continued
growth through the rest of the year and beyond, plus we are adding
the launch of Betaine Anhydrous which should further boost our
growth,” said Sean Brynjelsen, CEO of Eton Pharmaceuticals. “With
our strong cash position and expectation to reach profitability in
the near future, we are in a prime position to continue
opportunistically expanding our rare disease portfolio.”
First Quarter and Recent Business
Highlights
Ninth straight quarter of sequential growth in product
sales and royalty revenue. Eton reported first quarter
2023 product sales and royalty revenue of $5.3 million,
representing 144% growth over the prior year period and 52% growth
over the fourth quarter of 2022.
Record sales of Carglumic Acid. The company
continues to see strong demand for the product from patients and
prescribers. The first quarter results benefited from key account
conversions that the company believes are a direct result of its
expanded sales team.
Record sales of ALKINDI SPRINKLE. ALKINDI
SPRINKLE also saw strong revenue and patient growth during the
first quarter of 2023. During the quarter, Eton launched a new
direct to consumer campaign and implemented initiatives to further
increase its engagement with the adrenal insufficiency
community.
Launch of Betaine Anhydrous. This week, Eton
announced the launch of Betaine Anhydrous. Betaine Anhydrous shares
a prescriber base with Carglumic Acid, and both products are
expected to benefit from the co-promotion and increased
interactions with metabolic geneticists.
Acquired rare disease product candidate ET-600.
During the quarter, Eton acquired ET-600, an innovative product
candidate under development for a rare pediatric endocrinology
condition. If approved, ET-600 would address a significant unmet
need and have the same prescriber base as ALKINDI SPRINKLE. The
Company expects to file a New Drug Application for the product in
2024.
First Quarter Financial Results
Net Revenue: Net revenues for the first quarter
of 2023 were $5.3 million compared with $2.2 million in the prior
year period. In both periods, revenue was comprised entirely of
product sales and royalties, and the increase was driven primarily
by growth in ALKINDI SPRINKLE and Carglumic Acid.
Gross Profit: Gross profit for the first
quarter of 2023 was $3.3 million compared with $1.3 million in the
prior year period.
Research and Development (R&D) Expenses:
R&D expenses for the first quarter of 2023 were $0.5 million
compared to $1.6 million in the prior year period. The decrease in
R&D expenses was due primarily to a $0.5 million one-time
development milestone payment made in the first quarter of
2022.
General and Administrative (G&A) Expenses:
G&A expenses for the first quarter of 2023 were $5.3 million
compared to $4.8 million in the prior year period. The increase in
G&A expenses was due primarily to incremental employee-related
expenses associated with our sales force expansion. $0.9 million of
first quarter 2023 G&A expenses were non-cash.
Net Income: Net loss for the first quarter of
2023 was $2.7 million or $0.10 per basic and diluted share compared
to a net loss of $5.3 million or $0.21 per diluted share in the
prior year period.
Cash Position: As of March 31, 2023, the
Company had cash and cash equivalents of $14.7 million.
Conference Call and Webcast Information
As previously announced, Eton Pharmaceuticals will host its
first quarter 2023 conference call as follows:
Date: |
Thursday, May
11, 2023 |
Time: |
4:30 p.m. ET (3:30 p.m. CT) |
Register (Audio Only): |
Click Here |
The webcast can be accessed under “Events & Presentations”
in the Investors section of the Company’s website at
https://ir.etonpharma.com. The webcast will be archived and made
available for replay on the Company’s website approximately two
hours after the call and will be available for 30 days.
Forward-Looking Statements
Statements contained in this press release regarding matters
that are not historical facts are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995, including statements associated with the expected ability
of Eton to undertake certain activities and accomplish certain
goals and objectives. These statements include but are not limited
to statements regarding Eton’s business strategy, Eton’s plans to
develop and commercialize its product candidates, the safety and
efficacy of Eton’s product candidates, Eton’s plans and expected
timing with respect to regulatory filings and approvals, and the
size and growth potential of the markets for Eton’s product
candidates. Because such statements are subject to risks and
uncertainties, actual results may differ materially from those
expressed or implied by such forward-looking statements. Words such
as "believes," "anticipates," "plans," "expects," "intends,"
"will," "goal," "potential" and similar expressions are intended to
identify forward-looking statements. These forward-looking
statements are based upon Eton’s current expectations and involve
assumptions that may never materialize or may prove to be
incorrect. Actual results and the timing of events could differ
materially from those anticipated in such forward-looking
statements as a result of various risks and uncertainties, which
include, without limitation, risks associated with the process of
discovering, developing and commercializing drugs that are safe and
effective for use as human therapeutics, and in the endeavor of
building a business around such drugs. These and other risks
concerning Eton’s development programs and financial position are
described in additional detail in Eton’s filings with the
Securities and Exchange Commission. All forward-looking statements
contained in this press release speak only as of the date on which
they were made. Eton undertakes no obligation to update such
statements to reflect events that occur or circumstances that exist
after the date on which they were
made.About Eton
Pharmaceuticals
Eton Pharmaceuticals, Inc. is an innovative pharmaceutical
company focused on developing and commercializing treatments for
rare diseases. The Company currently has three FDA approved
products in ALKINDI SPRINKLE®, Carglumic Acid tablets, and Betaine
Anhydrous for oral solution, and four late-stage pipeline
candidates under development with dehydrated alcohol injection,
ZENEO® hydrocortisone autoinjector, ET-400, and ET-600. In
addition, the Company receives royalties on three FDA-approved
products and is entitled to receive milestone payments on other
products. For more information, please visit our website
at www.etonpharma.com.
Investor Relations:Lisa M. Wilson, In-Site
Communications, Inc.T: 212-452-2793E: lwilson@insitecony.com
Eton Pharmaceuticals, Inc. |
|
Condensed Statements of Operations |
|
(In thousands, except per share amounts) |
|
(Unaudited) |
|
|
|
For the three months ended |
|
|
|
March 31, |
|
|
March 31, |
|
|
|
2023 |
|
|
2022 |
|
Revenues: |
|
|
|
|
|
|
|
|
Licensing revenue |
|
$ |
— |
|
|
$ |
— |
|
Product sales and
royalties |
|
|
5,304 |
|
|
|
2,176 |
|
Total net
revenues |
|
|
5,304 |
|
|
|
2,176 |
|
|
|
|
|
|
|
|
|
|
Cost of
sales: |
|
|
|
|
|
|
|
|
Licensing revenue |
|
|
— |
|
|
|
— |
|
Product sales and
royalties |
|
|
1,958 |
|
|
|
849 |
|
Total cost of
sales |
|
|
1,958 |
|
|
|
849 |
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
|
3,346 |
|
|
|
1,327 |
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Research and development |
|
|
535 |
|
|
|
1,618 |
|
General and
administrative |
|
|
5,345 |
|
|
|
4,796 |
|
Total operating
expenses |
|
|
5,880 |
|
|
|
6,414 |
|
|
|
|
|
|
|
|
|
|
(Loss) income from
operations |
|
|
(2,534 |
) |
|
|
(5,087 |
) |
|
|
|
|
|
|
|
|
|
Other (expense)
income: |
|
|
|
|
|
|
|
|
Interest and other expense,
net |
|
|
(126 |
) |
|
|
(243 |
) |
|
|
|
|
|
|
|
|
|
(Loss) income before
income tax expense |
|
|
(2,660 |
) |
|
|
(5,330 |
) |
|
|
|
|
|
|
|
|
|
Income tax expense |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
Net (loss)
income |
|
$ |
(2,660 |
) |
|
$ |
(5,330 |
) |
Net (loss) income per
share, basic and diluted |
|
$ |
(0.10 |
) |
|
$ |
(0.21 |
) |
Weighted average number of
common shares outstanding, basic and diluted |
|
|
25,525 |
|
|
|
25,301 |
|
Eton Pharmaceuticals, Inc. |
|
Condensed Balance Sheets |
|
(in thousands, except share and per share
amounts) |
|
|
|
|
|
March 31, 2023 |
|
|
December 31, 2022 |
|
|
|
(Unaudited) |
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
14,708 |
|
|
$ |
16,305 |
|
Accounts receivable, net |
|
|
2,874 |
|
|
|
1,852 |
|
Inventories |
|
|
437 |
|
|
|
557 |
|
Prepaid expenses and other
current assets |
|
|
1,099 |
|
|
|
1,290 |
|
Total current
assets |
|
|
19,118 |
|
|
|
20,004 |
|
|
|
|
|
|
|
|
|
|
Property and equipment,
net |
|
|
56 |
|
|
|
72 |
|
Intangible assets, net |
|
|
4,573 |
|
|
|
4,754 |
|
Operating lease right-of-use
assets, net |
|
|
169 |
|
|
|
188 |
|
Other long-term assets,
net |
|
|
12 |
|
|
|
12 |
|
Total
assets |
|
$ |
23,928 |
|
|
$ |
25,030 |
|
|
|
|
|
|
|
|
|
|
Liabilities and
stockholders’ equity |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
1,233 |
|
|
$ |
1,766 |
|
Current portion of long-term
debt |
|
|
1,339 |
|
|
|
1,033 |
|
Accrued liabilities |
|
|
4,922 |
|
|
|
3,662 |
|
Total current
liabilities |
|
|
7,494 |
|
|
|
6,461 |
|
|
|
|
|
|
|
|
|
|
Long-term debt, net of
discount and including accrued fees |
|
|
5,107 |
|
|
|
5,384 |
|
Operating lease liabilities,
net of current portion |
|
|
86 |
|
|
|
107 |
|
|
|
|
|
|
|
|
|
|
Total
liabilities |
|
|
12,687 |
|
|
|
11,952 |
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies (Note 11) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’
equity |
|
|
|
|
|
|
|
|
Common stock, $0.001 par
value; 50,000,000 shares authorized; 25,504,378 and 25,353,119
shares issued and outstanding at March 31, 2023 and December 31,
2022, respectively |
|
|
26 |
|
|
|
25 |
|
Additional paid-in
capital |
|
|
117,009 |
|
|
|
116,187 |
|
Accumulated deficit |
|
|
(105,794 |
) |
|
|
(103,134 |
) |
Total stockholders’
equity |
|
|
11,241 |
|
|
|
13,078 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders’ equity |
|
$ |
23,928 |
|
|
$ |
25,030 |
|
Eton Pharmaceuticals, Inc. |
|
Condensed Statements of Cash Flows |
|
(In thousands) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Three months ended |
|
|
|
March 31, 2023 |
|
|
March 31, 2022 |
|
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(2,660 |
) |
|
$ |
(5,330 |
) |
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net
loss to net cash (used in) provided by operating activities: |
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
872 |
|
|
|
1,083 |
|
Depreciation and
amortization |
|
|
213 |
|
|
|
181 |
|
Debt discount
amortization |
|
|
29 |
|
|
|
36 |
|
Changes in operating assets
and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(1,022 |
) |
|
|
4,675 |
|
Inventories |
|
|
120 |
|
|
|
40 |
|
Prepaid expenses and other
assets |
|
|
191 |
|
|
|
961 |
|
Accounts payable |
|
|
(530 |
) |
|
|
(393 |
) |
Accrued liabilities |
|
|
1,239 |
|
|
|
(30 |
) |
Net cash (used in)
provided by operating activities |
|
|
(1,548 |
) |
|
|
1,223 |
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities |
|
|
|
|
|
|
|
|
Purchases of property and
equipment |
|
|
— |
|
|
|
(15 |
) |
Net cash used in
investing activities |
|
|
— |
|
|
|
(15 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities |
|
|
|
|
|
|
|
|
Repayment of long-term
debt |
|
|
— |
|
|
|
(385 |
) |
Proceeds from employee stock
purchase plan and stock option exercises |
|
|
132 |
|
|
|
— |
|
Payment of tax withholding
related to net share settlement of stock option exercises |
|
|
(181 |
) |
|
|
|
|
Net cash used in
financing activities |
|
|
(49 |
) |
|
|
(385 |
) |
|
|
|
|
|
|
|
|
|
Change in cash and
cash equivalents |
|
|
(1,597 |
) |
|
|
823 |
|
Cash and cash equivalents at
beginning of period |
|
|
16,305 |
|
|
|
14,406 |
|
Cash and cash equivalents at
end of period |
|
$ |
14,708 |
|
|
$ |
15,229 |
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of cash flow information |
|
|
|
|
|
|
|
|
Cash paid for interest |
|
$ |
216 |
|
|
$ |
215 |
|
Cash paid for income
taxes |
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of non-cash investing activities: |
|
|
|
|
|
|
|
|
Payable for product license
fee |
|
$ |
— |
|
|
$ |
750 |
|
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