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| 8-K - ANIKA THERAPEUTICS, INC. 8-K - Anika Therapeutics, Inc. | a51705116.htm |
Exhibit 99.1
Anika Reports Third Quarter 2017 Financial Results
Completed
Enrollment in CINGAL Phase III Clinical Trial;
Advancement
of Regenerative Medicine Pipeline;
MONOVISC
Revenue Increased 50% Year-over-Year
BEDFORD, Mass.--(BUSINESS WIRE)--October 25, 2017--Anika Therapeutics, Inc. (NASDAQ: ANIK), a global, integrated orthopedic medicines company specializing in therapeutics based on its proprietary hyaluronic acid (“HA”) technology, today reported financial results for the third quarter ended September 30, 2017, along with business progress in the period.
“Anika made significant progress on multiple fronts executing its long-term growth strategy, highlighted by the early completion of enrollment in the CINGAL® Phase III trial, regulatory clearances for the expansion of MONOVISC® into India, Australia, and Taiwan, pipeline advancements and the bolstering of our executive and commercial leadership team,” said Charles H. Sherwood, Ph.D., Chief Executive Officer. “MONOVISC continued to gain worldwide market share in the third quarter as physicians continue to migrate towards single-injection solutions, resulting in MONOVISC revenue growth of 50% year-over-year for the quarter. Additionally, we advanced our regenerative medicine pipeline with the submission of a 510(k) application to the U.S. Food and Drug Administration for our injectable HA-based bone repair treatment, a promising new opportunity gaining attention in the orthopedic space.”
Third Quarter Financial Results
- Total revenue for the third quarter of 2017 increased 5% year-over-year to $27.2 million, compared to $25.8 million for the third quarter of 2016.
- Worldwide Orthobiologics revenue grew 7% year-over-year in the third quarter of 2017. The main driver of this product revenue growth was an increase in global MONOVISC revenue of 50% year-over-year in the third quarter of 2017, which was partially offset by the continued decline in ORTHOVISC® revenue in the same period, mirroring the industry shift from multiple- to single-injection therapies.
- International Orthobiologics revenue increased 10% year-over-year for the third quarter of 2017, due primarily to the global expansion of MONOVISC, as well as the growth of CINGAL. Domestically, ORTHOVISC and MONOVISC continue to maintain a combined market-leading position.
- Total operating expenses for the third quarter of 2017 were $16.9 million, compared to $12.1 million for the third quarter of 2016. The increase in total operating expenses was due primarily to higher research and development investments required to advance the Company’s growing pipeline towards regulatory approvals, and the expansion of the commercial team in anticipation of those product launches.
- Net income for the third quarter of 2017 was $6.9 million, or $0.46 per diluted share, compared to $9.0 million, or $0.59 per diluted share, for the third quarter of 2016. The decline in net income was due primarily to the planned increase in operating expenses previously discussed.
Recent Business Highlights
The Company made key commercial,
operational, pipeline, and financial advancements, including:
- Completing enrollment well ahead of schedule in the second pivotal Phase III trial evaluating CINGAL, the Company’s novel HA-corticosteroid combination viscosupplement for the treatment of symptoms associated with osteoarthritis (OA) of the knee. The Phase III trial, which will evaluate 576 patients with mild to moderate knee osteoarthritis, is designed to evaluate the safety of CINGAL as well as its effectiveness in improving pain, function, and quality of life measures over a 26-week period, in comparison to MONOVISC and triamcinolone hexacetonide. Enrollment was completed well ahead of internal estimates largely due to physician and patient interest, and enthusiasm surrounding the immediate and durable joint relief possible with CINGAL.
- Receiving regulatory approval for MONOVISC in India, Australia and Taiwan for the treatment of pain associated with osteoarthritis of all synovial joints. Sales in those countries are expected to begin in the fourth quarter of 2017.
- Advancing Anika’s regenerative medicine pipeline with the submission of a 510(k) application to the U.S. Food and Drug Administration for its injectable HA-based bone repair treatment. This treatment provides an injectable, self-setting, osteoconductive bone graft substitute that resorbs and is replaced by the growth of new bone during the healing process.
- Publishing data demonstrating the efficacy and safety of HYALOFAST® in combination with autologous adult mesenchymal stem cells for the treatment of cartilage lesions on the knee in the peer-reviewed journal Knee Surgery Sports Traumatology Arthroscopy.
- Strengthening the Company’s executive leadership team with the appointments of Joseph Darling as President, Steven Chartier as Vice President of Regulatory and Clinical Affairs, and the anticipated appointment of Thomas Finnerty as Chief Human Resources Officer on October 30.
- Continued progress towards full consolidation of the Company’s global manufacturing operations at Anika’s Bedford, Massachusetts corporate headquarters.
Conference Call Information
Anika’s management will hold a
conference call and webcast to discuss its financial results and
business highlights tomorrow, Thursday, October 26th at 9:00
am ET. The conference call can be accessed by dialing 1-855-468-0611
(toll-free domestic) or 1-484-756-4332 (international). A live audio
webcast will be available in the "Investor Relations" section of Anika’s
website, www.anikatherapeutics.com. An accompanying slide
presentation may also be accessed via the Anika website. A replay of the
webcast will be available on Anika’s website approximately two hours
after the completion of the event.
About Anika Therapeutics, Inc.
Anika Therapeutics,
Inc. (NASDAQ: ANIK) is a global, integrated orthopedic medicines company
based in Bedford, Massachusetts. Anika is committed to improving the
lives of patients with degenerative orthopedic diseases and traumatic
conditions with clinically meaningful therapies along the continuum of
care, from palliative pain management to regenerative cartilage repair.
The Company has over two decades of global expertise developing,
manufacturing, and commercializing more than 20 products based on its
proprietary hyaluronic acid (HA) technology. Anika's orthopedic medicine
portfolio includes ORTHOVISC, MONOVISC, and CINGAL, which alleviate pain
and restore joint function by replenishing depleted HA, and HYALOFAST, a
solid HA-based scaffold to aid cartilage repair and regeneration. For
more information about Anika, please visit www.anikatherapeutics.com.
Forward-Looking Statements
The statements made in the last
sentence of the second bullet point and in the fifth bullet point in the
section captioned “Recent Business Highlights” of this press release,
which are not statements of historical fact, are forward-looking
statements within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. These statements include, but are not limited to,
those relating to sales expectations with regard to the Company’s
MONOVISC product and to the Company’s appointment of personnel. These
statements are based upon the current beliefs and expectations of the
Company’s management and are subject to significant risks,
uncertainties, and other factors. The Company’s actual results could
differ materially from any anticipated future results, performance, or
achievements described in the forward-looking statements as a result of
a number of factors including, but not limited to, (i) the Company’s
ability to successfully commence and/or complete clinical trials of its
products on a timely basis or at all; (ii) the Company’s ability to
obtain pre-clinical or clinical data to support domestic and
international pre-market approval applications, 510(k) applications, or
new drug applications, or to timely file and receive FDA or other
regulatory approvals or clearances of its products; (iii) that such
approvals will not be obtained in a timely manner or without the need
for additional clinical trials, other testing or regulatory submissions,
as applicable; (iv) the Company’s research and product development
efforts and their relative success, including whether we have any
meaningful sales of any new products resulting from such efforts; (v)
the cost effectiveness and efficiency of the Company’s clinical studies,
manufacturing operations, and production planning; (vi) the strength of
the economies in which the Company operates or will be operating, as
well as the political stability of any of those geographic areas; (vii)
future determinations by the Company to allocate resources to products
and in directions not presently contemplated; (viii) the Company’s
ability to successfully commercialize its products, in the U.S. and
abroad; (ix) the Company’s ability to provide an adequate and timely
supply of its products to its customers; and (x) the Company’s ability
to achieve its growth targets. Additional factors and risks are
described in the Company’s periodic reports filed with the Securities
and Exchange Commission, and they are available on the SEC’s website at www.sec.gov.
Forward-looking statements are made based on information available to
the Company on the date of this press release, and the Company assumes
no obligation to update the information contained in this press release.
| Anika Therapeutics, Inc. and Subsidiaries | |||||||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||||||
| (in thousands, except per share data) | |||||||||||||||||||
| (unaudited) | |||||||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||||||
| Product revenue | $ | 27,178 | $ | 25,783 | $ | 78,899 | $ | 74,636 | |||||||||||
| Licensing, milestone and contract revenue | 6 | 6 | 5,133 | 17 | |||||||||||||||
| Total revenue | 27,184 | 25,789 | 84,032 | 74,653 | |||||||||||||||
| Operating expenses: | |||||||||||||||||||
| Cost of product revenue | 6,250 | 4,998 | 18,648 | 16,488 | |||||||||||||||
| Research and development | 5,842 | 2,822 | 14,521 | 7,773 | |||||||||||||||
| Selling, general and administrative | 4,823 | 4,280 | 14,862 | 12,525 | |||||||||||||||
| Total operating expenses | 16,915 | 12,100 | 48,031 | 36,786 | |||||||||||||||
| Income from operations | 10,269 | 13,689 | 36,001 | 37,867 | |||||||||||||||
| Interest income, net | 261 | 93 | 335 | 214 | |||||||||||||||
| Income before income taxes | 10,530 | 13,782 | 36,336 | 38,081 | |||||||||||||||
| Provision for income taxes | 3,643 | 4,830 | 12,587 | 13,619 | |||||||||||||||
| Net income | $ | 6,887 | $ | 8,952 | $ | 23,749 | $ | 24,462 | |||||||||||
| Basic net income per share: | |||||||||||||||||||
| Net income | $ | 0.47 | $ | 0.61 | $ | 1.63 | $ | 1.66 | |||||||||||
| Basic weighted average common shares outstanding | 14,579 | 14,625 | 14,572 | 14,726 | |||||||||||||||
| Diluted net income per share: | |||||||||||||||||||
| Net income | $ | 0.46 | $ | 0.59 | $ | 1.58 | $ | 1.61 | |||||||||||
| Diluted weighted average common shares outstanding | 15,115 | 15,077 | 15,065 | 15,163 | |||||||||||||||
| Anika Therapeutics, Inc. and Subsidiaries | |||||||||||||||||||
| Condensed Consolidated Balance Sheets | |||||||||||||||||||
| (in thousands, except per share data) | |||||||||||||||||||
| (unaudited) | |||||||||||||||||||
| September 30, | December 31, | ||||||||||||||||||
| ASSETS | 2017 | 2016 | |||||||||||||||||
| Current assets: | |||||||||||||||||||
| Cash and cash equivalents | $ | 126,960 | $ | 104,261 | |||||||||||||||
| Investments | 25,750 | 20,500 | |||||||||||||||||
| Accounts receivable, net of reserves of $217 and $194 at September 31, 2017 and December 31, 2016, respectively | 23,804 | 27,598 | |||||||||||||||||
| Inventories, net | 20,252 | 15,983 | |||||||||||||||||
| Prepaid expenses and other current assets | 2,268 | 2,098 | |||||||||||||||||
| Total current assets | 199,034 | 170,440 | |||||||||||||||||
| Property and equipment, net | 53,973 | 52,296 | |||||||||||||||||
| Other long-term assets | 1,283 | 69 | |||||||||||||||||
| Intangible assets, net | 10,738 | 10,227 | |||||||||||||||||
| Goodwill | 8,104 | 7,214 | |||||||||||||||||
| Total assets | $ | 273,132 | $ | 240,246 | |||||||||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||||
| Current liabilities: | |||||||||||||||||||
| Accounts payable | $ | 5,189 | $ | 2,303 | |||||||||||||||
| Accrued expenses and other current liabilities | 6,516 | 6,496 | |||||||||||||||||
| Total current liabilities | 11,705 | 8,799 | |||||||||||||||||
| Other long-term liabilities | 545 | 2,126 | |||||||||||||||||
| Deferred tax liability | 7,593 | 6,548 | |||||||||||||||||
| Commitments and contingencies | |||||||||||||||||||
| Stockholders’ equity: | |||||||||||||||||||
| Preferred stock, $0.01 par value; 1,250 shares authorized, no shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively | - | - | |||||||||||||||||
| Common stock, $0.01 par value; 60,000 shares authorized, 14,662 and 14,627 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively | 146 | 146 | |||||||||||||||||
| Additional paid-in-capital | 66,746 | 61,735 | |||||||||||||||||
| Accumulated other comprehensive loss | (5,047 | ) | (7,317 | ) | |||||||||||||||
| Retained earnings | 191,444 | 168,209 | |||||||||||||||||
|
Total stockholders’ equity |
253,289 | 222,773 | |||||||||||||||||
| Total liabilities and stockholders’ equity | $ | 273,132 | $ | 240,246 | |||||||||||||||
| Anika Therapeutics, Inc. and Subsidiaries | |||||||||||||||||||||||||||||
| Supplemental Financial Data | |||||||||||||||||||||||||||||
| Revenue by Product Line and Product Gross Margin | |||||||||||||||||||||||||||||
| (in thousands, except percentages) | |||||||||||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||||||||||||
| Product Line: | 2017 | % | 2016 | % | 2017 | % | 2016 | % | |||||||||||||||||||||
| Orthobiologics | $ | 23,990 | 88 | % | $ | 22,428 | 87 | % | $ | 68,686 | 87 | % | $ | 65,319 | 88 | % | |||||||||||||
| Surgical | 1,765 | 7 | % | 1,173 | 5 | % | 4,395 | 6 | % | 3,924 | 5 | % | |||||||||||||||||
| Dermal | 358 | 1 | % | 594 | 2 | % | 1,235 | 2 | % | 1,558 | 2 | % | |||||||||||||||||
| Other | 1,065 | 4 | % | 1,588 | 6 | % | 4,583 | 5 | % | 3,835 | 5 | % | |||||||||||||||||
| Product Revenue | $ | 27,178 | 100 | % | $ | 25,783 | 100 | % | $ | 78,899 | 100 | % | $ | 74,636 | 100 | % | |||||||||||||
| Product Gross Profit | $ | 20,928 | $ | 20,785 | $ | 60,251 | $ | 58,148 | |||||||||||||||||||||
| Product Gross Margin |
77% |
|
81% |
|
76% |
|
78% |
|
|||||||||||||||||||||
| Product Revenue by Geographic Region | |||||||||||||||||||||||||||||
| (in thousands, except percentages) | |||||||||||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||||||||||||
| 2017 | % | 2016 | % | 2017 | % | 2016 | % | ||||||||||||||||||||||
| Geographic Region: | |||||||||||||||||||||||||||||
| United States | $ | 22,227 | 82 | % | $ | 21,126 | 82 | % | $ | 63,507 | 81 | % | $ | 61,032 | 82 | % | |||||||||||||
| Europe | 2,832 | 10 | % | 2,703 | 10 | % | 9,743 | 12 | % | 8,240 | 11 | % | |||||||||||||||||
| Other | 2,119 | 8 | % | 1,954 | 8 | % | 5,649 | 7 | % | 5,364 | 7 | % | |||||||||||||||||
| Product Revenue | $ | 27,178 | 100 | % | $ | 25,783 | 100 | % | $ | 78,899 | 100 | % | $ | 74,636 | 100 | % | |||||||||||||
CONTACT:
Anika Therapeutics, Inc.
Charles H. Sherwood, Ph.D., CEO
Sylvia
Cheung, CFO
Tel: 781-457-9000