neos_Current_Folio_8K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 8‑K


CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 13, 2020


NEOS THERAPEUTICS, INC.

(Exact name of registrant as specified in its charter)


Delaware

(State or other jurisdiction of incorporation)

 

 

 

001‑37508

    

27‑0395455

(Commission File No.)

 

(IRS Employer Identification No.)

 


2940 N. Highway 360

Grand Prairie, TX 75050

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (972) 408‑1300

Not applicable

(Former name or former address, if changed since last report.)


Check the appropriate box below if the Form 8‑K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a‑12 under the Exchange Act (17 CFR 240.14a‑12)

Pre-commencement communications pursuant to Rule 14d‑2(b) under the Exchange Act (17 CFR 240.14d‑2(b))

Pre-commencement communications pursuant to Rule 13e‑4(c) under the Exchange Act (17 CFR 240.13e‑4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

 

 

 

 

 

 

 

 

 

Title of each class

    

Trading Symbol(s)

    

Name of each exchange on which registered

Common stock, par value $0.001 per share

 

NEOS

 

The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b‑2 of the Securities Exchange Act of 1934 (§240.12b‑2 of this chapter).  Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

 

 

 

 

 

Item 2.02.            Results of Operations and Financial Condition.

The information under this caption and contained in the press release attached hereto as Exhibit 99.1 is furnished by Neos Therapeutics, Inc. (the “Company”) in accordance with Securities Exchange Commission Release No. 33‑8216. This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act whether made before or after the date of this Current Report, except as shall be expressly set forth by specific reference in such a filing.

On March 13, 2020, the Company issued a press release announcing its financial results for the quarter and fiscal year ended December 31, 2019.  A copy of the press release is furnished hereto as Exhibit 99.1 and incorporated herein by reference.

Item 9.01.            Financial Statements and Exhibits.

(d)              Exhibits

 

 

 

Number

    

Description

 

 

 

99.1

 

Press Release dated March 13, 2020

 

EXHIBIT INDEX

 

 

 

Exhibit

 

 

Number

    

Description

 

 

 

99.1

 

Press Release dated March 13, 2020

 

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

NEOS THERAPEUTICS, INC.

 

 

 

 

 

 

Date: March 13, 2020

By:

/s/ Richard Eisenstadt

 

 

Richard Eisenstadt

 

 

Chief Financial Officer

 

3

neos_Ex99_1

Exhibit 99.1

Neos Therapeutics Reports Fourth Quarter and Year-End 2019 Financial Results

— Full year 2019  net revenues increased by 29% and operating loss decreased by $33M —

— Neos RxConnect rapidly expanded with ~500 pharmacies in network at year-end —

— NT0502 Phase 1 ascending dose trial initiation planned in 2H20 following top-line PK data —

— Company to host conference call today at 8:30am ET —

DALLAS and FORT WORTH, Texas, March 13, 2020 — Neos Therapeutics, Inc. (Nasdaq: NEOS), a commercial-stage pharmaceutical company developing and manufacturing central nervous system-focused products, today reported financial results for the fourth quarter and fiscal year ended December 31, 2019 and provided a business update.

“We made tremendous strides in 2019, following the reset of our commercial strategy for our ADHD portfolio, which resulted in an improvement to the financial foundation of the company. In particular, we realized a 29% increase in net revenues for the full year of 2019 compared to 2018 and through our focus on operational productivity and expense management, we reduced our operating loss by approximately $33 million compared to 2018. During the year, we established and rapidly grew our proprietary Neos RxConnect patient support program to approximately 500 pharmacies. As we look forward, we are confident in the outlook for 2020 and beyond,” said Jerry McLaughlin, president and chief executive officer. “We are also extremely pleased to now have top-line results from the NT0502 Phase 1 pilot pharmacokinetic study, and we plan to initiate an ascending dose study in the second half of the year. We believe NT0502 has the potential to address a significantly underserved patient population of individuals struggling with chronic sialorrhea, otherwise known as excessive drooling, across numerous debilitating CNS disorders.”

ADHD Commercial Franchise

·

Increased net revenue per pack by over 30 percent: Neos reported growth in net product sales and net revenue per pack for its two core commercial attention deficit hyperactivity disorder (ADHD) products, Adzenys XR-ODT® and Cotempla XR-ODT®, for the three months ended December 31, 2019 compared to the same period in 2018.

 

 

 

 

 

 

 

 

 

 

 

 

Net Revenue per Pack

 

 

 

Q4 2019

 

Q4 2018

 

% Change

 

Adzenys XR-ODT

 

$

128

 

$

97

 

32

%

Cotempla XR-ODT

 

$

126

 

$

95

 

33

%

 

·

Strong growth in Neos RxConnect patient support program: During the fourth quarter of 2019, the company substantially expanded the number of participating pharmacies in the Neos RxConnect network to approximately 500 pharmacies, including one regional pharmacy chain, as of December 31, 2019. In mid-March, the company added a second regional pharmacy chain with approximately 250 pharmacies to the network, and it remains in active discussions with a number of other regional pharmacies strategically aligned in Neos territories.

·

Planned 2Q 2020 commercial launch of ADHD portfolio in Puerto Rico: Neos recently entered into an agreement with a third-party to commercialize Neos’ ADHD portfolio in Puerto Rico. The commercial launch is anticipated to occur in the second quarter of 2020.

Advancing Clinical Pipeline

·

Phase 1 pilot pharmacokinetic top-line data for NT0502: The company has completed a Phase 1 pilot study evaluating the pharmacokinetic profile of multiple formulations of NT0502 in 30 healthy adult volunteers. The top-line data confirms a formulation for further clinical development.  

·

NT0502 Phase 1 ascending dose trial to begin in second half of 2020: The company plans to initiate a Phase 1 clinical trial of NT0502 in the second half of 2020. The multi-part study will include single ascending and multiple ascending dose cohorts.

Financial Highlights and Select Financial Results

·

For the fourth quarter of 2019, net loss narrowed to $3.5 million, down from $9.3 million in the fourth quarter of 2018, reflecting the evolution of the commercial strategy and the company’s focus on both operational productivity and expense management.

·

Total product revenues were $16.8 million for the three months ended December 31, 2019, compared to $15.4 million for the same period in 2018. For the fiscal year ended December 31, 2019, total product revenues were $64.6 million, compared to $50.0 million for the fiscal year ended December 31, 2018.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fourth Quarter

 

Fiscal Year

 

    

2019

    

2018

    

% Change

 

    

2019

    

2018

    

% Change

 

Adzenys XR-ODT

 

$

8.5MM

 

$

8.1MM

 

4.9

%

 

$

31.2MM

 

$

26.6MM

 

17.3

%

Cotempla XR-ODT

 

$

6.1MM

 

$

6.1MM

 

0

%

 

$

25.6MM

 

$

19.0MM

 

34.7

%

Adzenys ER

 

$

0.3MM

 

$

*

 

*

 

 

$

0.8MM

 

$

*

 

*

 

Generic Tussionex

 

$

1.9MM

 

$

1.4MM

 

35.7

%

 

$

7.0MM

 

$

4.3MM

 

62.8

%

Total

 

$

16.8MM

 

$

15.4MM

 

9.1

%

 

$

64.6MM

 

$

50.0MM

 

29.2

%


*Adzenys ER revenue was negligible in Q4 and fiscal year 2018.

·

Gross profit was  $9.7 million for the three months ended December 31, 2019, compared to $7.6 million for the same period in 2018. For the fiscal year ended December 31, 2019, gross profit was  $39.5 million, compared to  $23.1 million for the fiscal year ended December 31, 2018.

·

Research and development expenses were $1.8 million for the three months ended December 31, 2019, compared to  $2.4 million for the same period in 2018. For the fiscal year ended December 31, 2019,  research and development expenses were  $8.6 million, compared to $8.5 million for the fiscal year ended December 31, 2018.

·

Selling and marketing expenses were $6.7 million for the three months ended December 31, 2019, compared to $9.1 million for the same period in 2018. For the fiscal year ended December 31, 2019, selling and marketing expenses were $28.1 million, compared to  $44.1 million for the fiscal year ended December 31, 2018.

·

General and administrative expenses were $2.9 million for the three months ended December 31, 2019, compared to $3.3 million for the same period in 2018. For the fiscal year ended December 31, 2019, general and administrative expenses were $13.2 million, compared to  $13.9 million for the fiscal year ended December 31, 2018.

·

Net loss for the three months ended December 31, 2019 was  $3.5 million, or $0.07 per share, compared to a net loss of $9.3 million, or $0.23 per share, for the same period in 2018. For the fiscal year ended December 31, 2019, net loss was  $16.9 million, or $0.34 per share, compared to a net loss of $51.7 million, or $1.60 per share for the fiscal year ended December 31, 2018.

·

At December 31, 2019, the company held $24.9 million in cash and cash equivalents and short-term investments.

Conference Call Details

Neos management will host a conference call and live audio webcast to discuss results and provide a Company update at 8:30 a.m. ET today. The live call may be accessed by dialing (877) 388‑8985 for domestic calls, or +1 (562) 912‑2654 for international callers, and referencing conference ID number 5454889. A live audio webcast for the conference call

will be available on the Investor Relations page of the Company’s website at http://investors.neostx.com/. Following the conclusion of the call, the webcast will be available for replay for 30 days.

About Neos Therapeutics

Neos Therapeutics, Inc. (NASDAQ: NEOS) is a commercial-stage pharmaceutical company utilizing its novel microparticle delivery technology to develop and manufacture central nervous system (CNS)-focused products. Adzenys XR-ODT® (amphetamine) extended-release orally disintegrating tablets (see Full Prescribing Information, including Boxed WARNING), Cotempla XR-ODT® (methylphenidate) extended-release orally disintegrating tablets (see Full Prescribing Information, including Boxed WARNING), and Adzenys-ER® (amphetamine) extended-release oral suspension (see Full Prescribing Information, including Boxed WARNING), all for the treatment of ADHD, are three approved products utilizing the Company’s novel microparticle delivery technology. Additional information about Neos is available at www.neostx.com.

Forward-Looking Statements

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 net sales, profitability, and growth of the Company’s commercial products, including the Company’s confidence in the outlook for 2020 and beyond, the Company’s future expansion of the Neos RxConnect network and the expected launch of the Company’s ADHD products in Puerto Rico; 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 ascending dose study of NT0502 in the second half of 2020 and whether NT0502 has the potential to address a significantly underserved patient population; the uncertainties inherent in conducting clinical trials, including whether the Phase 1 pilot study of NT0502 confirms a formulation for further clinical development; expectations for regulatory interactions, submissions and approvals; the financial condition and outlook for the Company, including whether the Company will continue to make progress towards its goal of achieving operational profitability; 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 Securities and Exchange Commission (SEC) and in other filings the Company makes with the SEC from time to time. In addition, the forward-looking statements included in this press release represent the Company’s views only as of the date hereof. The Company anticipates that subsequent events and developments may cause the Company’s views to change. However, while the Company may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so, except as may be required by law.

Neos Therapeutics, Inc. and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

(unaudited)

 

 

 

 

 

 

 

 

    

December 31, 

    

December 31, 

 

 

2019

 

2018

ASSETS

 

 

  

 

 

  

Current Assets:

 

 

  

 

 

  

Cash and cash equivalents

 

$

16,830

 

$

46,478

Short-term investments

 

 

8,064

 

 

 —

Accounts receivable, net of allowances for chargebacks and cash discounts of $4,848 and $1,865 at December 31, 2019 and 2018, respectively

 

 

26,563

 

 

27,801

Inventories

 

 

11,010

 

 

10,367

Prepaid expenses and other current assets

 

 

4,092

 

 

4,032

Total current assets

 

 

66,559

 

 

88,678

 

 

 

 

 

 

 

Property and equipment, net

 

 

7,345

 

 

7,914

Operating lease right-of-use assets

 

 

3,044

 

 

 —

Intangible assets, net

 

 

12,543

 

 

14,616

Other assets

 

 

1,382

 

 

149

Total assets

 

$

90,873

 

$

111,357

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY

 

 

  

 

 

  

 

 

 

 

 

 

 

Current Liabilities:

 

 

  

 

 

  

Accounts payable

 

$

6,650

 

$

12,730

Accrued expenses

 

 

40,188

 

 

35,818

Current portion of operating lease liabilities

 

 

681

 

 

 —

Current portion of long-term debt

 

 

15,836

 

 

8,557

Total current liabilities

 

 

63,355

 

 

57,105

 

 

 

 

 

 

 

Long-Term Liabilities:

 

 

  

 

 

  

Long-term debt, net of current portion

 

 

29,099

 

 

43,217

Operating lease liabilities

 

 

3,254

 

 

 —

Derivative liability

 

 

1,135

 

 

2,017

Deferred rent

 

 

 —

 

 

989

Other long-term liabilities

 

 

160

 

 

184

Total long-term liabilities

 

 

33,648

 

 

46,407

 

 

 

 

 

 

 

Stockholders' (Deficit) Equity:

 

 

  

 

 

  

Preferred stock, $0.001 par value, 5,000,000 shares authorized, no shares issued or outstanding at December 31, 2019 and 2018

 

 

 —

 

 

 —

Common stock, $0.001 par value, 100,000,000 shares authorized at December 31, 2019 and 2018; 49,766,472 and 49,732,671 shares issued and outstanding, respectively, at December 31, 2019; 49,710,104 and 49,676,303 shares issued and outstanding, respectively, at December 31, 2018

 

 

50

 

 

50

Treasury stock, at cost, 33,801 shares at December 31, 2019 and 2018

 

 

(352)

 

 

(352)

Additional paid-in capital

 

 

328,056

 

 

325,130

Accumulated deficit

 

 

(333,885)

 

 

(316,983)

Accumulated other comprehensive income

 

 

 1

 

 

 —

Total stockholders' (deficit) equity

 

 

(6,130)

 

 

7,845

Total liabilities and stockholders' (deficit) equity

 

$

90,873

 

$

111,357

 

Neos Therapeutics, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Year Ended

 

 

December 31, 

 

December 31, 

 

    

2019

    

2018

    

2019

    

2018

Revenues:

 

 

  

 

 

  

 

 

  

 

 

  

Net product sales

 

$

16,832

 

$

15,393

 

$

64,649

 

$

49,988

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

 

 

7,181

 

 

7,763

 

 

25,123

 

 

26,928

Gross profit

 

 

9,651

 

 

7,630

 

 

39,526

 

 

23,060

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development expenses

 

 

1,825

 

 

2,399

 

 

8,582

 

 

8,508

Selling and marketing expenses

 

 

6,659

 

 

9,140

 

 

28,122

 

 

44,133

General and administrative expenses

 

 

2,882

 

 

3,327

 

 

13,237

 

 

13,915

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

 

(1,715)

 

 

(7,236)

 

 

(10,415)

 

 

(43,496)

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(2,038)

 

 

(2,262)

 

 

(8,009)

 

 

(8,974)

Other income, net

 

 

276

 

 

161

 

 

1,533

 

 

795

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before income taxes

 

 

(3,477)

 

 

(9,337)

 

 

(16,891)

 

 

(51,675)

Income tax expense (benefit)

 

 

11

 

 

 —

 

 

11

 

 

 —

Net loss

 

$

(3,488)

 

$

(9,337)

 

$

(16,902)

 

$

(51,675)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding used to compute net loss per share, basic and diluted

 

 

49,732,654

 

 

41,415,358

 

 

49,723,772

 

 

32,288,555

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share of common stock, basic and diluted

 

$

(0.07)

 

$

(0.23)

 

$

(0.34)

 

$

(1.60)

 

Contacts:

Richard Eisenstadt

Chief Financial Officer

Neos Therapeutics, Inc.

(972) 408‑1389

reisenstadt@neostx.com 

 

Sarah McCabe

Stern Investor Relations, Inc.

(212) 362‑1200

sarah.mccabe@sternir.com