Neos Therapeutics Reports Third Quarter 2020 Financial Results
“During the third quarter, we saw Neos ADHD prescription volumes and the overall ADHD market begin to rebound from the profound impact of the COVID-19 pandemic in the second quarter of 2020, with continued prescription volume strength for the adult segment and a gradual recovery of the pediatric segment. We are pleased with the market rebound, and I am happy to report that, compared to the second quarter, third quarter prescription growth for Neos’ ADHD medications was nearly double the overall ADHD market,” said
ADHD Commercial Portfolio
- Neos brands outperforming the ADHD market: During the third quarter of 2020, the ADHD market saw sequential growth of 4.1% following the immediate and elongated impact of the ongoing COVID-19 pandemic, which began during the second quarter of 2020. Over this same period, Neos brands outperformed the overall market, with Adzenys XR-ODT growing by 9.9% and Cotempla XR-ODT growing by 6.5%.
- Neos RxConnect program continues to support prescription growth: During the third quarter of 2020, Neos commercial ADHD prescriptions filled through the Neos RxConnect pharmacy network grew sequentially by 17.7% and made up more than 40% of total Neos prescriptions filled. The program, which aims to simplify the process of gaining access to Neos ADHD medicines for both patients and healthcare providers, continues to be a key long-term growth driver for the Neos ADHD franchise.
- New strategy targeting adults with ADHD driving Adzenys XR-ODT growth: During the third quarter of 2020, Neos deployed new strategies for Adzenys XR-ODT focused on adults with ADHD. As a result, adult prescriptions for Adzenys XR-ODT grew sequentially by 10.7%. Overall ADHD market adult prescriptions grew by 4.1% during this same time period.
- NT0502 Phase 1 single ascending and multiple ascending dose trial plans to initiate in 1H2021: The Company now plans to initiate a Phase 1 clinical trial for NT0502, for the treatment of sialorrhea in patients with neurological conditions in the first half of 2021. The multi-part study includes single ascending and multiple ascending dose cohorts.
Financial Highlights and Select Third Quarter 2020 Financial Results
- Total product revenues were
$12.5 millionfor the three months ended September 30, 2020, compared to $17.5 millionfor the three months ended September 30, 2019.
|Q3 2020||Q3 2019||% Change
* Adzenys ER revenue was negligible in Q3 2020.
- Gross profit was
$7.4 millionfor the three months ended September 30, 2020, compared to a gross profit of $11.1 millionfor the same period in 2019.
- Research and development expenses were
$1.3 millionfor the three months ended September 30, 2020, compared to $1.6 millionfor the same period in 2019.
- Selling and marketing expenses were
$4.8 millionfor the three months ended September 30, 2020, compared to $7.1 millionfor the same period in 2019.
- General and administrative expenses were
$4.1 millionfor the three months ended September 30, 2020, compared to $2.8 millionfor the same period in 2019.
- For the third quarter of 2020, net loss was
$4.9 million, or ( $0.10) per share, compared to $2.1 million, or ( $0.04) per share, in the third quarter of 2019. Loss from operations was $2.9 millionfor the three months ended September 30, 2020, compared to $0.4 millionfor the same period in 2019.
September 30, 2020, the Company held $12.7 millionin cash and cash equivalents.
Conference Call Details
Neos management will host a conference call and live audio webcast to discuss these results and provide a company update at
Any statements in this press release about future expectations, plans and prospects for the Company, including statements about the Company’s strategy, future operations, commercial products, clinical development of its therapeutic candidates, plans for potential future product candidates, financial condition and outlook, and other statements containing the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “suggest,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” 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: the impact of COVID-19 on prescriptions for the Company’s products and on the Company’s business, revenues, results of operations and financial condition, including whether ADHD prescription volumes and the overall ADHD market are beginning to rebound from the impact of COVID-19; the net sales, profitability, and growth of the Company’s commercial products; the Neos RxConnect network, including whether it will continue to be a key long-term growth driver for the Neos ADHD franchise; the status, timing, costs, results and interpretation of the Company’s clinical trials or any future trials, including whether the Company will initiate a Phase 1 single ascending and multiple ascending dose study of NT0502 in the first half of 2021; the uncertainties inherent in conducting clinical trials; expectations for regulatory interactions, submissions and approvals; the financial condition and outlook for the Company, including whether the Company is on track to becoming operational cash flow positive and to maximize the financial contribution of the ADHD franchise over the next several years; availability of funding sufficient for the Company’s foreseeable and unforeseeable operating expenses and capital expenditure requirements; uncertainties related to the Company’s intellectual property; other matters that could affect the availability or commercial potential of the Company’s commercial products or therapeutic candidates; and other factors discussed in the Risk Factors set forth in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
|Cash and cash equivalents||$||12,744||$||16,830|
|Accounts receivable, net of allowances for chargebacks and cash discounts of
|Prepaid expenses and other current assets||2,443||4,092|
|Total current assets||44,009||66,559|
|Property and equipment, net||5,824||7,345|
|Operating lease right-of-use assets||2,655||3,044|
|Intangible assets, net||11,074||12,543|
|LIABILITIES AND STOCKHOLDERS' DEFICIT|
|Current portion of operating lease liabilities||693||681|
|Short-term line of credit||7,320||—|
|Current portion of long-term debt||19,472||15,836|
|Total current liabilities||67,161||63,355|
|Long-term debt, net of current portion||13,720||29,099|
|Operating lease liabilities||2,741||3,254|
|Other long-term liabilities||58||160|
|Total long-term liabilities||17,975||33,648|
|Additional paid-in capital||332,004||328,056|
|Accumulated other comprehensive income||—||1|
|Total stockholders' deficit||(20,552||)||(6,130||)|
|Total liabilities and stockholders' deficit||$||64,584||$||90,873|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
|Three Months Ended||Nine Months Ended|
|Net product sales||$||12,535||$||17,540||$||40,161||$||47,817|
|Cost of goods sold||5,120||6,447||17,387||17,942|
|Research and development expenses||1,310||1,551||4,668||6,757|
|Selling and marketing expenses||4,844||7,125||17,650||21,463|
|General and administrative expenses||4,177||2,850||12,135||10,355|
|Loss from operations||(2,916||)||(433||)||(11,679||)||(8,700||)|
|Other income (expense), net||12||251||(557||)||1,257|
|Loss before income taxes||(4,909||)||(2,051||)||(18,367||)||(13,414||)|
|Income tax expense||2||—||2||—|
|Weighted average common shares outstanding used to compute net loss per share, basic and diluted||49,755,094||49,730,755||49,747,076||49,720,780|
|Net loss per share of common stock, basic and diluted||$||(0.10||)||$||(0.04||)||$||(0.37||)||$||(0.27||)|
Chief Financial Officer
Stern Investor Relations, Inc.
Source: Neos Therapeutics, Inc.