Pacira Pharmaceuticals, Inc. Reports Second Quarter 2017 Financial Results
-- EXPAREL® Net Product Sales Up 6% Year-Over-Year --
-- Full-year EXPAREL net product sales guidance of
-- Conference Call Today at
“We are pleased to report another quarter of solid EXPAREL growth and remain on track to deliver our full-year financial guidance,” said
Recent Highlights
- Phase 4 study of EXPAREL in TKA published in
The Journal of Arthroplasty . InJuly 2017 , results from the company’s Phase 4 study of EXPAREL® (bupivacaine liposome injectable suspension) in patients undergoing total knee arthroplasty, or TKA, were published inThe Journal of Arthroplasty . The study compared EXPAREL admixed with bupivacaine HCl versus bupivacaine HCl alone. EXPAREL achieved statistical significance for its co-primary endpoints of opioid reduction and postsurgical pain, demonstrating a 78 percent reduction in opioid consumption from zero to 48 hours after surgery (18.7 mg versus 84.9 mg in the bupivacaine group; p=0.0048) and a reduction in pain scores from 12 to 48 hours after surgery (180.8 versus 209.3 in the bupivacaine group; p=0.0381). EXPAREL also achieved statistical significance for the study’s key secondary endpoints related to opioid reduction. - sNDA resubmission remains on track. In
July 2017 , the company reported topline results from two Phase 3 studies evaluating EXPAREL as a single-dose nerve block for prolonged regional analgesia and believes data from these two studies will satisfy the questions previously raised by theU.S. Food and Drug Administration (FDA ) in a complete response letter. The company expects to resubmit its supplemental New Drug Application, or sNDA, to theFDA later this year, seeking expansion of the EXPAREL label to include administration via nerve block. The sNDA will be based on two highly significant pivotal efficacy studies (the company’s original lower extremity study in femoral nerve block and the recently completed upper extremity study in brachial plexus block), safety and pharmacokinetic data through 120 days, and data from other peripheral nerve block comparator studies. Mark Froimson , MD joins Board of Directors. InJune 2017 ,Mark I. Froimson , M.D. was appointed to the company’s board of directors. Dr. Froimson is currently serving as the President of theAmerican Association of Hip and Knee Surgeons (AAHKS). Previously, he was the Executive Vice President and Chief Clinical Officer ofTrinity Health , a major national non-profit Catholic healthcare system comprising 93 hospitals in 22 states.
Second Quarter 2017 Financial Results
- EXPAREL net product sales were
$69.8 million in the second quarter of 2017, a 6% increase over the$65.8 million reported for the second quarter of 2016.
- Total revenues were
$70.9 million in the second quarter of 2017, a 2% increase over the$69.6 million reported for the second quarter of 2016.
- Total operating expenses were
$86.7 million in the second quarter of 2017, compared to$76.1 million in the second quarter of 2016.
- In the second quarter of 2017, the Company recorded a non-recurring charge of
$5.0 million related to the discontinuation of DepoCyt(e), including$0.5 million for DepoCyt(e)-related inventory (recorded in cost of goods sold) and$4.5 million for other exit costs. During the second quarter of 2017 and 2016, DepoCyt(e) revenue represented approximately 1% and 4% of total revenues, respectively.
- GAAP net loss was
$19.7 million , or$(0.49) per share (basic and diluted), in the second quarter of 2017, compared to a GAAP net loss of$8.0 million , or$(0.21) per share (basic and diluted), in the second quarter of 2016.
- Non-GAAP net loss was
$4.4 million , or$(0.11) per share (basic and diluted) in the second quarter of 2017, compared to non-GAAP net income of$7.9 million , or$0.21 per share (basic) and$0.19 per share (diluted), in the second quarter of 2016.
- Pacira ended the second quarter of 2017 with cash, cash equivalents and short-term investments (“cash”) of
$382.4 million .
- Pacira had 40.2 million basic weighted average shares of common stock outstanding in the second quarter of 2017.
2017 Outlook
Pacira reiterated its full year 2017 financial guidance as follows:
- EXPAREL net product sales of
$290 million to $310 million .
- Non-GAAP gross margins of approximately 70%.
- Non-GAAP research and development (R&D) expense of
$50 million to $60 million .
- Non-GAAP selling, general and administrative (SG&A) expense of
$145 million to $155 million .
- Stock-based compensation of
$30 million to $35 million .
See “Non-GAAP Financial Information” and “Reconciliations of GAAP to Non-GAAP 2017 Financial Guidance” below.
Today’s Conference Call and Webcast Reminder
The Pacira management team will host a conference call to discuss the company’s financial results and recent developments today,
A replay of the call will be available approximately two hours after the completion of the call and can be accessed by dialing 1-855-859-2056 (domestic) or 1-404-537-3406 (international) and providing the Conference ID 46683453. The replay of the call will be available for two weeks from the date of the live call.
The live, listen-only webcast of the conference call can also be accessed by visiting the “Investors & Media” section of the company’s website at investor.pacira.com. A replay of the webcast will be archived on the Pacira website for two weeks following the call.
Non-GAAP Financial Information
This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), such as non-GAAP net income (loss), non-GAAP cost of goods sold, non-GAAP gross margins, non-GAAP research and development (R&D) and non-GAAP selling, general and administrative (SG&A) expenses, because such measures exclude stock-based compensation, amortization of debt discount, loss on early extinguishment of debt, a contract termination fee with
About Pacira
About EXPAREL®
EXPAREL (bupivacaine liposome injectable suspension) is currently indicated for single-dose infiltration into the surgical site to produce postsurgical analgesia. The product combines bupivacaine with DepoFoam®, a proven product delivery technology that delivers medication over a desired time period. EXPAREL represents the first and only multivesicular liposome local anesthetic that can be utilized in the peri- or postsurgical setting. By utilizing the DepoFoam platform, a single dose of EXPAREL delivers bupivacaine over time, providing significant reductions in cumulative pain score with up to a 45 percent decrease in opioid consumption; the clinical benefit of the opioid reduction was not demonstrated. Additional information is available at www.EXPAREL.com.
Important Safety Information
EXPAREL is contraindicated in obstetrical paracervical block anesthesia. EXPAREL has not been studied for use in patients younger than 18 years of age. Non-bupivacaine-based local anesthetics, including lidocaine, may cause an immediate release of bupivacaine from EXPAREL if administered together locally. The administration of EXPAREL may follow the administration of lidocaine after a delay of 20 minutes or more. Other formulations of bupivacaine should not be administered within 96 hours following administration of EXPAREL. Monitoring of cardiovascular and neurological status, as well as vital signs should be performed during and after injection of EXPAREL as with other local anesthetic products. Because amide-type local anesthetics, such as bupivacaine, are metabolized by the liver, EXPAREL should be used cautiously in patients with hepatic disease. Patients with severe hepatic disease, because of their inability to metabolize local anesthetics normally, are at a greater risk of developing toxic plasma concentrations. In clinical trials, the most common adverse reactions (incidence greater-than or equal to 10%) following EXPAREL administration were nausea, constipation, and vomiting.
Please see the full Prescribing Information for more details available at http://www.exparel.com/pdf/EXPAREL_Prescribing_Information.pdf.
Forward Looking Statements
Any statements in this press release about the company’s future expectations, plans, outlook and prospects, and other statements containing the words “believes,” “anticipates,” “plans,” “estimates,” “expects,” “intends,” “may” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including risks relating to: the success of the Company's sales and manufacturing efforts in support of the commercialization of EXPAREL; the rate and degree of market acceptance of EXPAREL and the company’s other products; the size and growth of the potential markets for EXPAREL and the company’s ability to serve those markets; the company’s plans to expand the use of EXPAREL to additional indications and opportunities, and the timing and success of any related clinical trials; the related timing and success of
(Tables to Follow)
| Pacira Pharmaceuticals, Inc. | |||||||
| Condensed Consolidated Balance Sheets | |||||||
| (in thousands) | |||||||
| (unaudited) | |||||||
| June 30, 2017 |
December 31, 2016 |
||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash, cash equivalents and short-term investments | $ | 382,442 | $ | 172,597 | |||
| Accounts receivable, net | 27,467 | 29,937 | |||||
| Inventories, net | 33,602 | 31,278 | |||||
| Prepaid expenses and other current assets | 7,480 | 9,277 | |||||
| Total current assets | 450,991 | 243,089 | |||||
| Fixed assets, net | 103,239 | 101,016 | |||||
| Goodwill | 50,943 | 46,737 | |||||
| Other assets | 572 | 624 | |||||
| Total assets | $ | 605,745 | $ | 391,466 | |||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 10,392 | $ | 7,511 | |||
| Accrued expenses | 46,755 | 37,261 | |||||
| Convertible senior notes (1) | 319 | — | |||||
| Income taxes payable | 44 | 66 | |||||
| Total current liabilities | 57,510 | 44,838 | |||||
| Convertible senior notes (2) | 269,328 | 108,738 | |||||
| Other liabilities | 17,859 | 18,914 | |||||
| Total stockholders’ equity | 261,048 | 218,976 | |||||
| Total liabilities and stockholders’ equity | $ | 605,745 | $ | 391,466 | |||
(1)
(2) At June 30, 2017,
| Pacira Pharmaceuticals, Inc. | |||||||||||||||
| Consolidated Statements of Operations | |||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||
| (unaudited) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, | June 30, | ||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||
| Net product sales: | |||||||||||||||
| EXPAREL | $ | 69,773 | $ | 65,753 | $ | 137,474 | $ | 129,505 | |||||||
| DepoCyt(e) and other product sales | 366 | 1,934 | 1,090 | 2,684 | |||||||||||
| Total net product sales | 70,139 | 67,687 | 138,564 | 132,189 | |||||||||||
| Collaborative licensing and milestone revenue | 130 | 1,356 | 336 | 1,713 | |||||||||||
| Royalty revenue | 665 | 597 | 1,317 | 1,212 | |||||||||||
| Total revenues | 70,934 | 69,640 | 140,217 | 135,114 | |||||||||||
| Operating expenses: | |||||||||||||||
| Cost of goods sold | 23,811 | 23,053 | 48,392 | 43,331 | |||||||||||
| Research and development | 18,856 | 9,362 | 35,487 | 18,855 | |||||||||||
| Selling, general and administrative | 39,552 | 43,669 | 81,672 | 81,626 | |||||||||||
| Product discontinuation | 4,495 | — | 4,495 | — | |||||||||||
| Total operating expenses | 86,714 | 76,084 | 170,046 | 143,812 | |||||||||||
| Loss from operations | (15,780 | ) | (6,444 | ) | (29,829 | ) | (8,698 | ) | |||||||
| Other (expense) income: | |||||||||||||||
| Interest income | 1,224 | 324 | 1,738 | 576 | |||||||||||
| Interest expense | (5,226 | ) | (1,733 | ) | (7,815 | ) | (3,601 | ) | |||||||
| Loss on early extinguishment of debt (1) | (11 | ) | — | (3,732 | ) | — | |||||||||
| Other, net | 80 | (47 | ) | 89 | 1 | ||||||||||
| Total other expense, net | (3,933 | ) | (1,456 | ) | (9,720 | ) | (3,024 | ) | |||||||
| Loss before income taxes | (19,713 | ) | (7,900 | ) | (39,549 | ) | (11,722 | ) | |||||||
| Income tax expense | (30 | ) | (58 | ) | (60 | ) | (90 | ) | |||||||
| Net loss | $ | (19,743 | ) | $ | (7,958 | ) | $ | (39,609 | ) | $ | (11,812 | ) | |||
| Net loss per share: | |||||||||||||||
| Basic and diluted net loss per common share | $ | (0.49 | ) | $ | (0.21 | ) | $ | (1.01 | ) | $ | (0.32 | ) | |||
| Weighted average common shares outstanding: | |||||||||||||||
| Basic and diluted | 40,160 | 37,181 | 39,079 | 37,101 | |||||||||||
(1) Amount relates to the loss on early extinguishment from our repurchase of
| Pacira Pharmaceuticals, Inc. | |||||||||||||||
| Reconciliation of GAAP to Non-GAAP Financial Information | |||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||
| (unaudited) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, | June 30, | ||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||
| GAAP net loss | $ | (19,743 | ) | $ | (7,958 | ) | $ | (39,609 | ) | $ | (11,812 | ) | |||
| Non-GAAP adjustments: | |||||||||||||||
| Stock-based compensation | 7,345 | 7,665 | 14,744 | 16,155 | |||||||||||
| Loss on early extinguishment of debt | 11 | — | 3,732 | — | |||||||||||
| Amortization of debt discount | 2,951 | 1,022 | 4,362 | 2,044 | |||||||||||
| CrossLink contract termination fee | — | 7,184 | — | 7,184 | |||||||||||
| Product discontinuation costs | 5,002 | — | 5,002 | — | |||||||||||
| Total Non-GAAP adjustments | 15,309 | 15,871 | 27,840 | 25,383 | |||||||||||
| Non-GAAP net income (loss) | $ | (4,434 | ) | $ | 7,913 | $ | (11,769 | ) | $ | 13,571 | |||||
| GAAP basic and diluted net loss per common share | $ | (0.49 | ) | $ | (0.21 | ) | $ | (1.01 | ) | $ | (0.32 | ) | |||
| Non-GAAP basic net income (loss) per common share | $ | (0.11 | ) | $ | 0.21 | $ | (0.30 | ) | $ | 0.37 | |||||
| Non-GAAP diluted net income (loss) per common share | $ | (0.11 | ) | $ | 0.19 | $ | (0.30 | ) | $ | 0.33 | |||||
| Weighted average common shares outstanding - basic | 40,160 | 37,181 | 39,079 | 37,101 | |||||||||||
| Weighted average common shares outstanding - diluted | 40,160 | 40,841 | 39,079 | 40,992 | |||||||||||
| Cost of goods sold reconciliation: | |||||||||||||||
| GAAP cost of goods sold | $ | 23,811 | $ | 23,053 | $ | 48,392 | $ | 43,331 | |||||||
| Stock-based compensation | (1,395 | ) | (1,610 | ) | (2,770 | ) | (3,159 | ) | |||||||
| Product discontinuation inventory | (507 | ) | — | (507 | ) | — | |||||||||
| Non-GAAP cost of goods sold | $ | 21,909 | $ | 21,443 | $ | 45,115 | $ | 40,172 | |||||||
| Research and development reconciliation: | |||||||||||||||
| GAAP research and development | $ | 18,856 | $ | 9,362 | $ | 35,487 | $ | 18,855 | |||||||
| Stock-based compensation | (647 | ) | (1,015 | ) | (1,304 | ) | (1,908 | ) | |||||||
| Non-GAAP research and development | $ | 18,209 | $ | 8,347 | $ | 34,183 | $ | 16,947 | |||||||
| Selling, general and administrative reconciliation: | |||||||||||||||
| GAAP selling, general and administrative | $ | 39,552 | $ | 43,669 | $ | 81,672 | $ | 81,626 | |||||||
| Stock-based compensation | (5,303 | ) | (5,040 | ) | (10,670 | ) | (11,088 | ) | |||||||
| CrossLink contract termination fee | — | (7,184 | ) | — | (7,184 | ) | |||||||||
| Non-GAAP selling, general and administrative | $ | 34,249 | $ | 31,445 | $ | 71,002 | $ | 63,354 | |||||||
| Product discontinuation reconciliation: | |||||||||||||||
| GAAP product discontinuation | $ | 4,495 | $ | — | $ | 4,495 | $ | — | |||||||
| Product discontinuation costs | (4,495 | ) | — | (4,495 | ) | — | |||||||||
| Non-GAAP product discontinuation | $ | — | $ | — | $ | — | $ | — | |||||||
| Pacira Pharmaceuticals, Inc. | ||||||
| Reconciliation of GAAP to Non-GAAP 2017 Financial Guidance | ||||||
| (dollars in millions) | ||||||
| GAAP to Non-GAAP Guidance | GAAP | Stock-Based Compensation and Other |
Non-GAAP | |||
| EXPAREL net product sales | $290 to $310 | — | — | |||
| Gross margin | Approx. 68% | Approx. 2% (1) | Approx. 70% | |||
| Research and development expense | $52 to $64 | $2 to $4 | $50 to $60 | |||
| Selling, general and administrative expense | $167 to $180 | $22 to $25 | $145 to $155 | |||
| Stock-based compensation | $30 to $35 | — | — | |||
(1) GAAP to Non-GAAP reconciliation for gross margins includes the impact of a
Investor Contact:Susan Mesco , (973) 451-4030 susan.mesco@pacira.com Media Contact: Coyne Public RelationsAlyssa Schneider , (973) 588-2270 aschneider@coynepr.com