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8-K - 8-K - Pacira BioSciences, Inc.a15-10327_18k.htm

Exhibit 99.1

 

NEWS RELEASE

 

FOR IMMEDIATE RELEASE

 

Pacira Pharmaceuticals, Inc. Reports First Quarter EXPAREL Revenues of $56.0 Million and First Quarter 2015 Financial Results

 

EXPAREL® Net Sales up 63% from Prior Year Period —

— Conference Call Today at 9 a.m. ET —

 

PARSIPPANY, N.J., April 30, 2015 — Pacira Pharmaceuticals, Inc. (NASDAQ: PCRX) today provided updates on EXPAREL® (bupivacaine liposome injectable suspension) for postsurgical pain in the United States and announced consolidated financial results for the first quarter ended March 31, 2015.

 

“With just a two percent market share of the approximately 42 million addressable procedures for the current infiltration indication, we remain confident in the long-term outlook for EXPAREL,” said Dave Stack, president, chief executive officer and chairman of Pacira. “We believe EXPAREL provides a non-opioid alternative for pain management in the midst of the opioid abuse epidemic, in which millions of Americans become long-term users every year after being introduced to opioids in the acute care postsurgical environment. We look forward to continuing our steady commercial efforts in 2015 for this important product, and are looking toward expanding the base business by working with the FDA to achieve approval for a nerve block indication and by moving forward with a Phase 3 clinical trial for the oral surgery indication for EXPAREL.”

 

Recent Developments

 

·                  Complete Response Letter: In March, Pacira announced receipt of a Complete Response Letter (CRL) from the U.S. Food and Drug Administration (FDA) following a review of its supplemental New Drug Application (sNDA) for the use of EXPAREL in nerve block to provide postsurgical analgesia.

 

·                  Studies Continue to Demonstrate Health Economic Benefits of Using EXPAREL in Knee and Hip Surgeries: An analysis of 2,248 patients undergoing total hip and knee replacement surgery was presented at the American Academy of Orthopedic Surgeons (AAOS) annual meeting. Patients receiving periarticular injections (PAI) of EXPAREL vs. PAI of bupivacaine HCl, with or without ketorolac, and morphine reported significantly lower pain scores, were more likely to report “zero pain” during their hospital stay, experienced improved satisfaction and were associated with an average cost savings of $1,246 per patient (approximately $1.5 million in overall hospital savings).

 



 

·                  Data Shows Significant Reductions in Opioid Consumption in TAP infiltration procedures: Study results evaluating patients who received either bupivacaine HCl or EXPAREL infiltrated into the transversus abdominis plane (TAP) following robotic assisted hysterectomy were presented at the annual meeting of the International Anesthesia Research Society (IARS). According to the data, EXPAREL patients experienced significantly decreased opioid intake, reduced incidence of nausea and vomiting and lower maximal pain intensity at the time points assessed (0-24 hours, 24-48 hours and 48-72 hours).

 

·                  Subpoena: In April, Pacira announced that it received a subpoena from the U.S. Department of Justice, U.S. Attorney’s Office for the District of New Jersey, requiring the production of a broad range of documents pertaining to marketing and promotional practices related to the product EXPAREL. Pacira intends to cooperate with the government’s investigation.

 

First Quarter 2015 Financial Results

 

·                  EXPAREL net product revenues were $56.0 million in the first quarter of 2015, compared to $34.4 million in the first quarter of 2014.

 

·                  Total revenues were $58.3 million in the first quarter of 2015, compared to $36.7 million in the first quarter of 2014.

 

·                  Total operating expenses were $55.0 million in the first quarter of 2015, compared to $45.9 million in the first quarter of 2014.

 

·                  GAAP net income was $1.3 million, or $0.03 per share (basic and diluted), in the first quarter of 2015, compared to a GAAP net loss of ($11.5) million, or ($0.34) per share (basic and diluted), in the first quarter of 2014.

 

·                  Non-GAAP net income was $9.8 million, or $0.27 per share (basic) and $0.23 per share (diluted), in the first quarter of 2015, compared to a non-GAAP net loss of ($6.5) million, or ($0.19) per share (basic and diluted), in the first quarter of 2014.

 

·                  Pacira ended the first quarter of 2015 with cash and cash equivalents, short-term investments and long-term investments (“cash”) of $174.8 million.

 

·                  Pacira had 36.2 million basic and 41.8 million diluted weighted average shares of common stock outstanding in the first quarter of 2015.

 



 

2015 Outlook

 

Given the current lack of visibility on EXPAREL sales resulting from the combined impact of recent regulatory developments and the government investigation, Pacira is suspending full year 2015 guidance for EXPAREL revenues and non-GAAP product gross margins.

 

Excluding stock-based compensation, Pacira expects the following non-GAAP operating expenses for 2015:

 

·                  Research and development (R&D) expense of $25 million to $30 million.

·                  Selling, general and administrative (SG&A) expense of $115 million to $125 million.

 

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, Thursday, April 30, 2015, at 9 a.m. ET. The call can be accessed by dialing 1-877-845-0779 (domestic) or 1-720-545-0035 (international) ten minutes prior to the start of the call and providing the Conference ID 83470502.

 

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 83470502. 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), non-GAAP net income (loss), because such measures exclude stock-based compensation and amortization of debt discount. These measures supplement our financial results prepared in accordance with GAAP. Pacira management uses these measures to better analyze its financial results and to help make managerial decisions. In management’s opinion, these non-GAAP measures are useful to investors and other users of our financial statements by providing greater transparency into the operating performance at Pacira. Such measures should not be deemed to be an alternative to GAAP requirements or a measure of liquidity for Pacira. Non-GAAP net income (loss) measures are also unlikely to be comparable with non-GAAP disclosures released by other companies. See a reconciliation of non-GAAP net income (loss) to GAAP net loss below.

 

The range of R&D and SG&A expenditure outlook for 2015 are non-GAAP financial measures because they exclude stock-based compensation charges. Such measures should not be deemed to be an alternative to GAAP requirements or a measure of liquidity for Pacira. Non-GAAP financial measures are also unlikely to be comparable with non-GAAP disclosures released by other companies.

 



 

About Pacira

 

Pacira Pharmaceuticals, Inc. (NASDAQ: PCRX) is a specialty pharmaceutical company focused on the clinical and commercial development of new products that meet the needs of acute care practitioners and their patients. The company’s flagship product, EXPAREL® (bupivacaine liposome injectable suspension), indicated for single-dose infiltration into the surgical site to produce postsurgical analgesia, was commercially launched in the United States in April 2012. EXPAREL and two other products have successfully utilized DepoFoam®, a unique and proprietary product delivery technology that encapsulates drugs without altering their molecular structure, and releases them over a desired period of time. Additional information about Pacira is available at www.pacira.com.

 

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 our future expectations, plans, outlook and prospects, including statements about expected non-GAAP operating expenses, and other statements containing the words “believes,” “anticipates,” “plans,” “estimates,” “expects,” 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 our sales and manufacturing efforts in support of the commercialization of EXPAREL; the rate and degree of market acceptance of EXPAREL; the size and growth of the potential markets for EXPAREL and our ability to serve those markets; our plans to expand the use of EXPAREL to additional indications, including nerve block, oral surgery and chronic pain, as well as pediatrics; the related timing and success of a United States Food and Drug Administration supplemental New Drug Application; the adverse effects and impacts of FDA warning letters; the outcome of the U.S. Department of Justice inquiry; our plans to evaluate, develop and pursue additional DepoFoam-based product candidates; clinical studies in support of an existing or potential DepoFoam-based product; our plans to continue to manufacture and provide support services for our commercial partners who have licensed DepoCyt(e); our commercialization and marketing capabilities; our and Patheon UK Limited’s ability to successfully and timely construct dedicated EXPAREL manufacturing suites; and other factors discussed in the “Risk Factors” of our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2014, and in other filings that we periodically make with the SEC. In addition, the forward-looking statements included in this press release represent our views as of the date of this press release. Important factors could cause our actual results to differ materially from those indicated or implied by forward-looking statements, and as such we anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

 

Company Contact:

 

Pacira Pharmaceuticals, Inc.

Jessica Cho, (973) 254-3574

 

Media Contact:

 

Pure Communications, Inc.

Susan Heins, (864) 286-9597

 

(Tables Follow)

 



 

Pacira Pharmaceuticals, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands)

 

 

 

March 31,

 

December 31,

 

 

 

2015

 

2014

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents, restricted cash and short-term investments

 

$

154,886

 

$

158,167

 

Accounts receivable, net

 

24,511

 

22,366

 

Inventories, net

 

36,264

 

29,263

 

Prepaid expenses and other current assets

 

4,089

 

4,461

 

Total current assets

 

219,750

 

214,257

 

Long-term investments

 

19,938

 

24,431

 

Fixed assets, net

 

67,206

 

60,632

 

Goodwill

 

25,381

 

23,761

 

Intangibles, net

 

323

 

403

 

Other assets

 

2,432

 

2,588

 

Total assets

 

$

335,030

 

$

326,072

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

5,565

 

$

6,758

 

Accrued expenses

 

25,296

 

28,311

 

Convertible senior notes (*)

 

104,135

 

103,100

 

Current portion of royalty interest obligation

 

 

276

 

Current portion of deferred revenue

 

1,426

 

1,426

 

Income taxes payable

 

31

 

139

 

Total current liabilities

 

136,453

 

140,010

 

Deferred revenue

 

9,152

 

9,508

 

Other liabilities

 

5,404

 

5,409

 

Total stockholders’ equity

 

184,021

 

171,145

 

Total liabilities and stockholders’ equity

 

$

335,030

 

$

326,072

 

 


( * ) The convertible senior notes are contractually due in 2019. However, because of certain conditions that were met during the three months ended March 31, 2015, the note holders can convert any time during the quarter ended June 30, 2015.

 



 

Pacira Pharmaceuticals, Inc.

Consolidated Statements of Operations

(unaudited)

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2015

 

2014

 

Revenues:

 

 

 

 

 

EXPAREL net product sales

 

$

55,951

 

$

34,401

 

DepoCyt(e) net product sales

 

1,135

 

1,341

 

Collaborative licensing and development revenue

 

356

 

252

 

Royalty revenue

 

874

 

668

 

Total revenues

 

58,316

 

36,662

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Cost of goods sold

 

17,580

 

18,127

 

Research and development

 

5,967

 

5,204

 

Selling, general and administrative

 

31,428

 

22,589

 

Total operating expenses

 

54,975

 

45,920

 

Income (loss) from operations

 

3,341

 

(9,258

)

 

 

 

 

 

 

Other (expense) income:

 

 

 

 

 

Interest income

 

155

 

42

 

Interest expense

 

(1,996

)

(2,107

)

Royalty interest obligation

 

(71

)

(120

)

Other, net

 

(117

)

(34

)

Total other expense, net

 

(2,029

)

(2,219

)

Income (loss) before income taxes

 

1,312

 

(11,477

)

Income tax expense

 

(52

)

 

Net income (loss)

 

$

1,260

 

$

(11,477

)

Net income (loss) per share:

 

 

 

 

 

Basic and diluted net income (loss) per common share

 

$

0.03

 

$

(0.34

)

Weighted average common shares outstanding:

 

 

 

 

 

Basic

 

36,235

 

33,711

 

Diluted

 

41,779

 

33,711

 

 



 

Pacira Pharmaceuticals, Inc.

Reconciliation of GAAP to Non-GAAP Financial Information

(unaudited)

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2015

 

2014

 

 

 

 

 

 

 

GAAP net income (loss)

 

$

1,260

 

$

(11,477

)

 

 

 

 

 

 

Non-GAAP adjustments:

 

 

 

 

 

Stock-based compensation

 

7,517

 

3,975

 

Non-cash debt discount amortization

 

1,035

 

1,035

 

Total Non-GAAP adjustments

 

8,552

 

5,010

 

 

 

 

 

 

 

Non-GAAP net income (loss)

 

$

9,812

 

$

(6,467

)

 

 

 

 

 

 

GAAP basic and diluted net income (loss) per common share

 

$

0.03

 

$

(0.34

)

 

 

 

 

 

 

Non-GAAP basic net income (loss) per common share

 

$

0.27

 

$

(0.19

)

Non-GAAP diluted net income (loss) per common share

 

$

0.23

 

$

(0.19

)

 

 

 

 

 

 

Weighted average common shares outstanding - basic

 

36,235

 

33,711

 

Weighted average common shares outstanding - diluted

 

41,779

 

33,711

 

 

 

 

 

 

 

Cost of goods sold reconciliation:

 

 

 

 

 

GAAP cost of goods sold

 

$

17,580

 

$

18,127

 

Stock-based compensation expense

 

(1,103

)

(494

)

Non-GAAP cost of goods sold

 

$

16,477

 

$

17,633

 

 

 

 

 

 

 

Research and development reconciliation:

 

 

 

 

 

GAAP research and development

 

$

5,967

 

$

5,204

 

Stock-based compensation expense

 

(1,510

)

(1,577

)

Non-GAAP research and development

 

$

4,457

 

$

3,627

 

 

 

 

 

 

 

Selling, general and administrative reconciliation:

 

 

 

 

 

GAAP selling, general and administrative

 

$

31,428

 

$

22,589

 

Stock-based compensation expense

 

(4,904

)

(1,904

)

Non-GAAP selling, general and administrative

 

$

26,524

 

$

20,685