Toronto Stock Exchange Symbol: DND MISSISSAUGA, ON, May 4, 2012
/CNW/ - Cipher Pharmaceuticals Inc. today announced its financial
and operational results for the three months ended March 31, 2012
("Q1 2012"). Q1 2012 Summary -- Achieved quarterly revenue of $1.8
million, a 168% increase over Q1 2011. -- Net income in Q1 2012 was
$0.1 million, compared with a loss of $1.1 million in Q1 2011. --
Received a US$1.0 million sales milestone for Lipofen®. -- Durela™
(extended-release tramadol) was launched in March 2012 by Cipher's
Canadian partner, Medical Futures Inc. -- Cash increased for the
third consecutive quarter to $10.1 million, compared with $9.6
million as at December 31, 2011. "Revenue grew strongly in the
first quarter based on Lipofen's performance and early
contributions from ConZipä, which was recently launched in the
U.S.," said Larry Andrews, President and CEO of Cipher. "In
addition, with the launch of Durelaä in Canada, we now have
multiple royalty revenue streams contributing to our results as we
await U.S. regulatory approval for CIP-ISOTRETINOIN, our promising
product for the treatment of acne." Financial Review Net revenue in
Q1 2012 was $1.8 million, an increase of 168% compared with $0.7
million in Q1 2011. Revenue from Lipofen® increased to $1.4 million
during Q1 2012 compared with $0.6 million in Q1 2011, reflecting a
strong performance by our U.S. partner, Kowa Pharmaceuticals, and
the achievement of a contractual net sales milestone, which
contributed $0.5 million in revenue for the quarter. Revenue
from ConZipä was $0.3 million in Q1 2012. No revenue was
recognized in Q1 of the prior year as the product was launched in
Q3 2011. Revenue from Durelaä was not significant during Q1 2012 as
the product was only launched in mid-March 2012. Research and
Development expense during Q1 2012 was $0.5 million, the same as
incurred in Q1 2011. Operating, General and Administrative expenses
for Q1 2012 declined to $1.0 million, compared to $1.2 million in
Q1 2011. Net income in Q1 2012 was $0.1 million, or $0.01 per
share, compared to a net loss of $1.1 million, or $0.05 per share,
in Q1 2011. The Company's financial position remained solid at
quarter end. As at March 31, 2012, Cipher had cash of $10.1
million, compared with $9.6 million as at December 31, 2011.
Product Update Lipofen® During Q1 2012, Lipofen® monthly
prescriptions increased solidly relative to the prior quarter based
on Kowa's increased promotional effort and a new managed care
client contract. Lipofen® achieved record sales performance for the
quarter, with royalty revenue 65% higher than the prior year and
26% higher than Q4 2011. During the first quarter, Cipher received
a US$1.0 million milestone payment from Kowa. Cipher's 50% share of
the milestone is reflected in its financial results for Q1 2012.
This one-time milestone, which was based on sales performance over
the trailing 12-month period, reflected steadily increasing new
prescriptions during the fourth quarter and Q1 2012. CIP-TRAMADOL
ER (ConZip™/Durela™) Cipher's extended-release tramadol was
launched in the U.S. by Vertical Pharmaceuticals in September 2011
under the trade name ConZip™. Vertical's dedicated sales force
comprises 60 representatives, with plans for further expansion in
2012. Product sales to date have been encouraging and the
Company expects solid growth in 2012 as U.S. physicians gain more
experience with the product and Vertical expands its coverage.
During Q3 2011, Cipher received Health Canada approval for
CIP-TRAMADOL ER and also completed a Canadian distribution and
supply agreement with Medical Futures. Medical Futures launched the
product in March 2012 under the trade name Durela™, with a
dedicated sales force comprising approximately 22 representatives.
CIP-ISOTRETINOIN Cipher's New Drug Application for CIP-ISOTRETINOIN
is currently under review by the FDA with a target action date
under PDUFA of May 29, 2012. Pre-commercial activities are
underway with Ranbaxy Pharmaceuticals, the Company's U.S. partner,
for a possible launch in Q4 2012. When CIP-ISOTRETINOIN is
commercialized, Cipher expects that it will have the potential to
generate significant revenue for the Company. Cipher completed a
New Drug Submission to Health Canada in Q4 2011. This was
accepted for review in Q1 2012, and a response from Health Canada
is expected in Q1 2013. Once approved, Cipher plans to market
the product in Canada on its own. New Products and Out-Licensing
Activities Cipher is actively pursuing out-licensing discussions
for its current products in other territories and is seeking late
to commercial stage product candidates to complement its Canadian
commercialization plans for CIP-ISOTRETINOIN. Notice of Conference
Call Cipher will hold a conference call today, May 4, 2012, at 8:30
a.m (ET) to discuss its financial results and other corporate
developments. To access the conference call by telephone, dial
647-427-7450 or 1-888-231-8191. A live audio webcast of the
call will be available at www.cipherpharma.com. The webcast will be
archived for 90 days. About Cipher Pharmaceuticals Inc. Cipher
Pharmaceuticals is a growing specialty pharmaceutical company that
commercializes novel formulations of successful, currently marketed
molecules. Cipher's strategy is to in-license clearly
differentiated products, advance them through the clinical
development and regulatory approval stages, and out-license to
international marketing partners. The Company's first product
is a fenofibrate formulation marketed in the United States as
Lipofen®. Cipher's second product, an extended-release tramadol, is
marketed in the United States as ConZip™ and is marketed in Canada
as Durela™. Cipher's New Drug Application for its third
product, a novel formulation of the acne treatment isotretinoin, is
currently being reviewed by the FDA and Health Canada. For more
information, please visit www.cipherpharma.com. Forward-Looking
Statements Statements made in this news release, other than those
concerning historical financial information, may be forward-looking
and therefore subject to various risks and uncertainties. The words
"may", "will", "could", "should", "would", "suspect", "outlook",
"believe", "plan", "anticipate", "estimate", "expect", "intend",
"forecast", "objective", "hope" and "continue" (or the negative
thereof), and words and expressions of similar import, are intended
to identify forward-looking statements. Certain material factors or
assumptions are applied in making forward-looking statements and
actual results may differ materially from those expressed or
implied in such statements. Factors that could cause results
to vary include those identified in the Company's Annual
Information Form and other filings with Canadian securities
regulatory authorities. These factors include, but are not limited
to losses; the applicability of patents and proprietary technology;
possible patent litigation; approval of products in the Company's
pipeline; marketing of products; meeting projected drug development
timelines and goals; product liability and insurance; dependence on
strategic partnerships and licensees; concentration of the
Company's revenue; substantial competition and rapid technological
change in the pharmaceutical industry; the publication of negative
results of clinical trials of the Company's products; the ability
to access capital; the ability to attract and retain key personnel;
changes in government regulation or regulatory approval processes;
dependence on contract research organizations; third party
reimbursement; the success of the Company's strategic investments;
the achievement of development goals and time frames; the
possibility of shareholder dilution; market price volatility of
securities; and the existence of significant shareholders. All
forward-looking statements presented herein should be considered in
conjunction with such filings. Except as required by Canadian
securities laws, the Company does not undertake to update any
forward-looking statements; such statements speak only as of the
date made. Cipher Pharmaceuticals Inc. Balance Sheets As at March
31, 2012 and December 31, 2011 (in thousands of Canadian dollars-
unaudited) March 31, December 31, 2012 2011 $ $ ASSETS Current
assets Cash 10,113 9,636 Accounts receivable 1,937 1,782 Prepaid
expenses and other assets 180 272 12,230 11,690 Property and
equipment, net 28 25 Intangible assets, net 2,719 2,944 14,977
14,659 LIABILITIES Current liabilities Accounts payable and accrued
liabilities 2,212 1,912 Current portion of deferred revenue 875 917
3,087 2,829 Deferred revenue 2,177 2,330 5,264 5,159 SHAREHOLDERS'
EQUITY Share capital 50,211 50,172 Contributed surplus 33,081
33,032 Deficit (73,579) (73,704) 9,713 9,500 14,977 14,659
Cipher Pharmaceuticals Inc. Statements of Operations and
Comprehensive Income (Loss) Three month periods ended March 31,
2012 and 2011 (in thousands of Canadian dollars, except per share
data - unaudited) March 31, March 31, 2012 2011 $ $ Revenues
Licensing revenue 1,811 675 Expenses Research and development 471
547 Operating, general and administrative 1,016 1,177 Amortization
of intangible assets 225 59 Interest income (26) (23) 1,686 1,760
Income (loss) and comprehensive income (loss) for 125 (1,085) the
period Basic and diluted earnings (loss) pershare 0.01 (0.05)
Cipher Pharmaceuticals Inc. Statements of Changes in Equity Three
month periods ended March 31, 2012 and 2011 (in thousands of
Canadian dollars - unaudited) Total Share Contributed Shareholders'
Capital Surplus Deficit Equity $ $ $ $ Balance, January 1, 50,172
33,032 (73,704) 9,500 2012 Income and comprehensive income - - 125
125 for the period Shares issued under the share purchase 39 - - 39
plan Share-based compensation - stock - 49 - 49 option plan
Balance, March 31, 50,211 33,081 (73,579) 9,713 2012 Balance,
January 1, 49,977 32,890 (71,393) 11,474 2011 Loss and
comprehensive - - (1,085) (1,085) loss for the period Share-based
compensation - stock - 28 - 28 option plan Balance, March 31,
49,977 32,918 (72,478) 10,417 2011 Cipher Pharmaceuticals
Inc. Statements of CashFlows Three month periods ended March 31,
2012 and 2011 (in thousands of Canadiandollars - unaudited) March
31, March 31, 2012 2011 $ $ Cash provided by(used in) Operating
activities Income (loss) for the period 125 (1,085) Items not
affecting cash: Depreciation of property and equipment 7 13
Amortization of intangible assets 225 59 Share-based compensation -
share purchase 6 - plan Share-based compensation - stock option
plan 49 28 412 (985) Changes in non-cash operating items: Accounts
receivable (155) 216 Prepaid expenses and other assets 92 100
Accounts payable and accrued liabilities 300 (364) Deferred revenue
(195) (144) Net cash generated from (used in) operating 454 (1,177)
activities Investing activities Purchase of property and equipment
(10) (4) Net cash generated from(used in) investing (10) (4)
activities Financing activities Proceeds from shares issued under
the share 33 - purchase plan Increase (Decrease) in cash 477
(1,181) Cash, beginningof period 9,636 10,328 Cash, end of period
10,113 9,147 Cipher Pharmaceuticals Inc. CONTACT: Craig
ArmitageInvestor RelationsThe Equicom Group(416) 815-0700 ext
278(416) 815-0080 faxcarmitage@equicomgroup.comLarry
AndrewsPresident and CEOCipher Pharmaceuticals(905) 602-5840 ext
324(905) 602-0628 faxlandrews@cipherpharma.com
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